Socialist wing of Greek coalition stands in way of austerity deal

City A.M. Reporter
TWO of Greece’s coalition parties stuck to a hard line against labour reforms demanded by the country’s lenders yesterday, blocking political agreement on a crucial austerity package.

The Democratic Left and Pasok Socialist parties in the fragile three-way coalition have repeatedly insisted they will not back controversial plans to cut wages, reduce severance payments and scrap automatic wage hikes.

Leaders of both parties refused to change their stance after the latest round of talks with Prime Minister Antonis Samaras yesterday – dashing hopes that the three leaders were close to sealing a deal on the austerity plan.

Samaras has been holding talks with coalition parties and the troika of European Commission, European Central Bank and International Monetary Fund over a €11.5bn package of spending cuts.