GREECE - Greek Prime Minister George Papandreou passed an overhaul of the pension system in a vote that tested the unity of his socialist government and prompted the second national strike in as many weeks.
The plan, which includes lower pension payments and delayed retirements, was carried with 159 votes to 137 against in the Athens parliament.
Papandreou, who expelled three members of his Pasok party for defying him in a May vote on austerity measures, managed to secure support from deputies even as some indicated they may oppose various articles that will be voted on individually today. A final vote on the bill will follow today.
"It is not the government or Pasok which will be at risk if things remain the same," Papandreou told the chamber before the vote. "Those who are at risk are Greek citizens. We are guaranteeing that the 20-year-olds and 30-year-olds of today will get a pension."
Papandreou committed to the pension overhaul to secure €110bn (US$135bn) in emergency loans from the European Union and the International Monetary Fund that allowed Greece to avert a default on its debt.
The pension vote follows passage in May of €30bn in austerity measures, including wage cuts and tax increases, that prompted the defection of the three socialist lawmakers.
Overhauling pension rules including curtailing early retirement and calculating payments over a longer period of employment will shore up Greece's public finances, the European Union has said.
Spending on pensions would reach 24% of GDP if left unchecked, twice the level of 2007. Concerns about Greece's future pension financing have played a part in the surge in the risk premium investors demand to buy Greek 10-year debt over comparable German bonds, the Organization for Economic Cooperation and Development said in a July 2009 report. That spread reached a euro-era record 973 basis points on May 7.
The People's Pension, Atlas Master Trust and The Cheviot Trust have been granted authorisation from The Pensions Regulator (TPR), taking the total number of authorised master trusts to 18.
Pension schemes have been warned they may now face a more challenging legal test if they wish to fix drafting errors.
The Greene King Pension Scheme has appointed XPS Pensions as its actuarial and investment adviser following a competitive tender process.
Professional Pensions has compiled a list charting the progress of master trust authorisation. View our list in full here...