Alt. FinMin: ‘Urgent need forcing us to collect money’

Mayors of largest municipalities, most regional authorities — sans ones controlled by SYRIZA — say they’ll ignore decision, take matter to the courts

 

The alternate finance minister on Tuesday referred to “an urgent need that forces us to collect money”, in comments to board members of a union representing the country’s municipalities.

The statement by the minister, Dimitris Mardas, comes in the wake of severe criticism of a government plan – outlined in a direct ministerial decision instead of tabled legislation via Parliament – to force practically state entities to keep their reserves in the central bank instead of commercial banks.

The decision was lambasted as a form of “internal obligatory lending” towards the cash-strapped general government by other organizations, including municipalities, regional governments, hospitals, universities and others.

Even more ominously, Mardas referred to a “hole” of 552 million euros in the General Accounting Office.

In a bid to allay growing and unabated criticism, moreover, Mardas told mayors — via a teleconference link — that the “borrowing will be short term” and that their municipalities can still withdraw cash – but under 10 percent of their reserves – to meeting obligations.

In order to access their “reserved reserves”, he mentioned that municipalities must now submit a written request and wait … two days.

When the leftist government announced the measure it said the reason was not to tap into the reserves because its coffers were nearing empty, but because the central bank offered a higher interest rate…

The measure has been sharply denounced by the mayors of the country’s largest municipalities and all the opposition parties.

Later in the day, the mayors of Greece’s largest municipalities and most regional governors — sans the ones from the ruling SYRIZA party — would ignore the order and take the matter to the courts.

The issue of bypassing Parliament was also raised as fundamentally unconstitutional.