Spending cuts proposed for 2009

In an effort to prove that Greece can cut public spending to deal with the economic crisis, Prime Minister Costas Karamanlis announced a 12 point program to cut government spending last week.
The plan is a response to the European Union call last week for the Greek Government to decrease its budget deficits and the emergency meeting held yesterday in Brussels of the leaders of all EU member countries to discuss the Union's response to the global financial crisis
Karamanlis stressed the need to eliminate wasteful public sector spending so that the Greek economy might weather the global economic crisis.
Karamanlis said that the global financial crisis was putting immense pressure on growth, employment and public finances.
He emphasized that this required the Greek government to increase spending to encourage economic growth and cater to the welfare needs of those impacted on most severely whilst also restricting overall spending to ensure financial stability in Greece.
The 12 point plan announced by Karamanlis made it clear that spending in some areas such as education and health would not be touched.
 Among the measures unveiled by the prime minister were a 10 percent cut in the budget of most ministries, an identical reduction in spending on contract workers and a ban on the hiring of any more permanent or temporary staff in the public sector.
Mirroring moves in other countries to limit the salaries of senior executives and managers,  Karamanlis also announced that officials in the public sector would not be able to earn more than 6,000 euros per month.
The plan also envisages a major rationalisation in  the number of government agencies within the next six months, major changes to the national pharmaceuticals benefit scheme in Greece and further measures to rein in tax evasion.
Sources said that apart from persuading European leaders that Greece is committed to reducing its burgeoning deficit at the leaders meeting in  Brussels, Karamanlis will be aiming to ensure that the European Commission does not impose any more measures on the country's economy and that the government is given as much time as possible to come out of the supervision under which Brussels has placed it.