Greece’s coalition government has been weakened as it pushed through another round of controversial EU-mandated reforms at the cost of losses to its parliamentary majority.
Prime minister Alexis Tsipras, re-elected for a second term in snap polls barely two months ago, saw his majority shrink to two seats in the 300-member House on Thursday after dissidents refused to endorse the measures.
“My patience has run its course,” said Stathis Panagoulis, an MP in Tsipras’ leftist Syriza party, before abstaining from the vote.
Nikos Nikolopoulos, a lawmaker with the Independent Greeks party Anel, the leftists’ junior partner in power, said the package of measures ran roughshod over all the government’s “red lines”. Both men were immediately expelled from the parties.
The expulsions underscored the difficulty of implementing policies set as the price of the debt-stricken country’s third international bailout. Earlier on Thursday, Tsipras’s once close ally and former government spokesman, Gavriel Sakellarides, made a statement saying he would resign as he could “no longer contribute to the realisation of the government’s policies”. He was automatically replaced by another MP.
After months of acrimonious talks with its partners, Athens was forced to accept harsh terms when it signed up to a €86bn (£60.3bn) financial lifeline allowing it to avoid a euro exit in July. Among the measures or “milestones” demanded by foreign lenders were tougher steps against mortgage holders who failed to honour loans, including seizure of homes.
The government had fought long and hard against the policy arguing it would result in thousands of society’s most vulnerable losing their primary residences at a time of acute social hardship. Under the multi-bill passed on Thursday, 25% of homeowners deemed to have low incomes or low home values will be offered protection against foreclosure – a far cry from the leftist-led government’s original promise to protect all Greeks from home repossessions.
“I refuse to throw onto the street borrowers fighting for their lives, leaving them at the mercy of banks,” Panagoulis, a veteran leftist, announced after the vote.
Creditors had insisted on the measure, saying the vast majority of those with mortgages in arrears were “strategic defaulters” whose actions harmed Greece’s highly indebted banking system.
The coalition’s U-turn elicited widespread condemnation from the political opposition which unanimously voted against the bill. Six years into its worst economic crisis in modern times, many are predicting Greece’s worst winter yet.
Addressing parliament, the social democrat Pasok leader Fofi Genimata accused the country’s first leftist administration of playing with fire. “Grexit is still in our courtyard and your policies are threatening to trigger social explosions,” she said.
The parliamentary debate had taken place against a backdrop of widespread consternation over the government’s decision to slap higher taxes on gambling and wine. But the EU economic affairs minister Pierre Moscovici congratulated Athens, calling the vote “another step forward for Greece”.
Passage of the multibill now unlocks €2bn in aid that the government has pledged to put into a parallel programme of relief measures.
Loans totalling €10bn that are essential to recapitalising Greek banks and revitalising the Greek economy are also expected to be released when Eurozone finance ministry officials gather on Friday.
