The Greek Finance Minister announced a pension increase from 2% to 2.5% from next January, as well as an increase in the minimum wage and salaries in the public sector.
The Greek government on Monday promised wage increases, including the minimum wage, and pensions to counter the high cost of living in a country where purchasing power is one of the lowest in the EU. “The government wants to prioritize issues such as demography, housing, climate change, but at the same time it has to deal with the demands of certain social groups,” Finance Minister Kostis Hadzidakis told a news conference.
Detailing a series of measures announced Saturday by Prime Minister Kyriakos Mitsotakis, the minister announced a rise in pensions from 2% to 2.5% from next January as well as an increase in the minimum wage and emoluments in the public sector. The Prime Minister, whose right-wing government is facing a drop in popularity, had announced Saturday in Thessaloniki (north) during a highly anticipated back-to-school speech the increase in the minimum wage from 830 euros currently to 950 euros by 2027.
Increases below inflation
In total, more than twenty measures must be adopted, including a one-point reduction in social security contributions and the exemption from taxation of empty apartments or houses, according to Kostis Hadzidakis. All the measures amount to nearly one billion euros, which are added to the initial budgetary expenditure forecasts of 2.8 billion euros for 2025, according to the government, which is counting on the green light from the European Commission soon to implement them.
The left-wing opposition Syriza criticised these announced increases “which do not cover inflation” (2.7% in July over a year) recalling that “real household income is falling rapidly”.
“Peanuts for retirees,” commented a columnist in the centre-left daily Ta Néa on Monday.
Despite continued growth in Greece in recent years (+2% in 2023) after a decade of crisis during which the country lost a quarter of its gross domestic product (GDP), the standard of living remains one of the lowest in the European Union. In 2023, the country had the second lowest GDP per capita in terms of purchasing power in the European Union while the average annual income reached only half the European average, according to Eurostat.
