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 The coalition of Tsipras' leftist Syriza party and the right-wing
nationalist Independent Greeks has a majority of just three seats in
parliament, and pro-European opposition parties that voted for
Greece's latest bailout are publicly refusing him any help on the
toxic pension issue.
The overhaul, which must deliver savings worth 1 percent of gross
domestic product or 1.8 billion euros next year, is the most
sensitive of a raft of reforms demanded by the euro zone and the
International Monetary Fund in return for up to 85 billion euros in
aid in the country's third bailout since 2010.
Trade unions have staged two 24-hour general strikes against further
pension cuts and Tsipras has promised there will be no
across-the-board reduction in benefits for retirees.
Tsipras says most of the savings will be achieved by ending early
retirement under a law enacted last month, leaving about 600 million
euros more to be saved.
"Hell, there must be ways to find those 600 million euros. It's not
6 billion, it's 600 million," he said in a television interview this
week after critics said he would struggle to avoid a new round of
unpopular pension cuts.
Instead the government is proposing to increase social security
contributions, mostly by employers - a move the lenders warn would
deter job creation and set back economic recovery, setting the stage
for tough negotiations next month.
WARS OF WORDS
As the deadline approaches, Tsipras launched an attack on the IMF
this week, saying it was making unconstructive demands on both sides
and should make up its mind whether it wanted to stay in the Greek
program.
That in turn triggered another war of words with Germany, the
biggest European creditor, which insists the global lender must stay
in the program to enforce tough discipline and to reassure German
lawmakers.
Sources in Syriza say some deputies are unhappy at the prospect of a
reform that will entail merging the country's multiple underfunded
pension funds and reducing state subsidies to the system and is
bound to lead to lower benefits for many.
No one knows how many, if any, of the grumblers may refuse to back
the law.
Aides say Tsipras will negotiate hard with the lenders but
ultimately will face down any opposition in his own party and push
the pension reform through parliament so that Greece can start
negotiations with the euro zone on debt relief in March.
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Tsipras dismissed talk of a wider coalition in the state TV
interview, saying his 153 seats in parliament were more solid than
the 225-seat majority which had initially supported a 2011-12
interim government of technocrat Lucas Papademos, which crumbled
within six months.
Political sources say the prime minister has put out feelers to a
small opposition party, the Union of the Centre, which has hinted
its nine lawmakers might let the legislation pass.
Despite their tough public stance, other opposition parties could
well abstain or absent themselves in sufficient numbers to ensure
passage of the pension bill, the sources said.
"No one has an interest in having another election now," said a
senior political source, noting that the conservative New Democracy
is in disarray ahead of a leadership election next week, and the
center-left PASOK party is wary of taking any new responsibility for
unpopular austerity measures.
The source said that while his "central scenario" was that Tsipras
would ram the pension reform through, there was a risk that the
prime minister would decide to play for time, delaying any reform
until pressure mounted and the threat of another destabilizing Greek
crisis began to affect financial markets.
A source on the lenders' side said creditors could also play things
long to increase reform leverage over Greece and push back debt
relief talks until after sensitive regional elections in Germany and
a general election in Slovakia in March.
While Tsipras remains Greece's dominant politician, with no
challenger in sight, Athens is awash with rumors of an "ecumenical
government" combining technocrats with consensual politicians if he
loses his majority.
(Writing by Paul Taylor; editing by Ralph Boulton)
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