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Parliamentary questions
11 May 2012
E-002666/2012
Answer given by Mr Rehn on behalf of the Commission

The Commission would refer the Honourable Member to its reply to Written Question E‑000616/2012(1).

The decision on the composition of fiscal adjustment is the decision of the Greek Government and the Greek Parliament, not of the Commission, the IMF and ECB. The role of these institutions in the context of the adjustment programme is first and foremost to advise, and to ensure that the measures that will be adopted are credible, consistent and well quantified and to monitor their implementation.

Cuts to military spending(2) have been a prominent part of the fiscal adjustment in Greece since the beginning of the Programme. According to Eurostat data(3), military spending in Greece declined from 4.0 % in 2000, to 3.4 % in 2009 and 2.2 % of GDP in 2010. Cuts in spending have also taken place in 2011 and further cuts to military spending are expected in the context of the additional fiscal adjustment envisaged for 2012-14. According to the latest update of the MoU(4), the fiscal measures that are necessary to reduce the deficit in 2013 and 2014 should focus on defence spending without prejudice to the defence capability of the country, but should also cover pensions and social transfers(5); restructuring of central and local administrations, and a further rationalization of pharmaceutical spending and operational expenditures of hospitals.

Spending on social protection (pensions, family allowances, unemployment benefits etc.) and healthcare amounted to 24 % of GDP in 2010. Given the size of this spending in total government expenditure and the sharp increase in entitlement spending in the run-up to the crisis, these expenditure components also need to make a substantial contribution to the fiscal consolidation.

(1)http://www.europarl.europa.eu/QP-WEB/home.jsp
(2)(both to procurement, ordinary spending by the Ministry of Defence and staff, including for example the number of entries in the military academy)
(3)COFOG database.
(4)See annex to the Commission services' compliance report: http://ec.europa.eu/economy_finance/publications/occasional_paper/2012/pdf/ocp94_en.pdf
(5)(in a manner that will preserve basic social protection)

OJ C 240 E, 21/08/2013
Last updated: 14 June 2012Legal notice