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 A first set of reforms that focused largely on tax hikes and
budget discipline triggered a rebellion in Syriza last week and
passed only thanks to votes from pro-EU opposition parties.
The bill that lawmakers voted on early Thursday covered rules for
dealing with failed banks and speeding up the justice system - two
more conditions set by the euro zone and IMF to open negotiations on
an 86 billion euro rescue loan.
The legislation easily passed with the backing of 230 votes in the
300-seat chamber, once again due to opposition support.
But 36 Syriza deputies - or almost a quarter of the party's 149
lawmakers - voted against the overall bill or abstained, though
significantly for Tsipras that was a smaller rebellion than the 39
deputies who defied him in last week's vote.
"We made tough choices, and I personally made difficult, responsible
choices. Today we must all redefine the possibilities ahead of us
given the new circumstances," Tsipras said in an appeal to
parliament to back the reforms.
"We chose a difficult compromise to avert the most extreme plans by
the most extreme circles in Europe."
Tsipras has publicly said he disagrees with measures demanded by
Greece's euro zone peers and the IMF for talks to proceed on a third
bailout to save the country from bankruptcy.
But after he made a U-turn by accepting a deal at the 11th hour to
keep his country in the euro, he told party hardliners to face
reality and back the package.
Even so, hardline Left Platform lawmakers from the Syriza party, who
opposed last week's bill, rejected this week's law as well and
complained about the length of the bill, which covered more than 900
pages.
Together with his coalition partners from the right-wing nationalist
Independent Greeks, Tsipras has 162 seats in the 300-seat
parliament.
Last week's rebellion cut his support to just 123 votes and
government officials have said elections are likely in September or
October once the package is agreed.
"We might go to elections, when this is needed," government
spokeswoman Olga Gerovasili earlier told local radio, adding that it
would not be helpful now as the country prepares to negotiate the
new bailout deal. "We are trying to bring the situation back to some
sort of normality," she said.
European Economic and Monetary Affairs Commissioner Pierre Moscovici
told reporters in Brussels he was confident the parliament would
adopt the bill. Creditor institutions were seeking to conclude talks
with Greece on a third bailout in the second half of August, he
said.
The government has said it hopes negotiations on the bailout deal
can start this week and be wrapped up by Aug. 20.
PROTEST RALLIES
In the first signs of a return to normal, Greek banks reopened on
Monday and Athens paid debts due to the European Central Bank and
International Monetary Fund. The ECB increased its emergency funding
by 900 million euros, the same amount it provided last week.
On Tuesday, Standard & Poor's upgraded Greece's sovereign credit
rating by two notches.
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But fresh austerity measures are hard to accept in a country whose
economy has contracted by a quarter during five years of crisis and
where unemployment is more than 25 percent. Rallies called by the
main public sector union ADEDY, the communist-affiliated party PAME
and anti-establishment groups drew several thousand people in front
of parliament.
Apart from some minor incidents, there was no repeat of the violence
seen at a rally last week, when masked youths hurled petrol bombs at
police as lawmakers were debating the first bailout bill.
With mistrust among euro zone countries still high despite the deal
struck last week to launch bailout talks, a senior German lawmaker
in Chancellor Angela Merkel's conservative party warned Greece it
would not get aid if it backtracked on reforms.
"We are keeping a close eye on whether Athens not only adopts the
reforms but also implements them," Gunther Krichbaum, chairman of
the German parliament's Europe committee, told the newspaper Bild.
"Greece must fulfill the conditions, otherwise the money cannot
flow."
The bill does not include pension reforms curbing early retirement
or increasing tax rates paid by farmers - a step strongly opposed by
the conservative New Democracy party and many Syriza deputies.
The fact that these measures were not included in the bill aroused
some media speculation that Athens was backtracking on reform
commitments. Finance Minister Euclid Tsakalotos told lawmakers
Greece had agreed with its lenders to deal with these issues during
bailout talks.
The bill adopts into Greek law new EU rules on dealing with failed
banks, imposing losses on shareholders and creditors of ailing
lenders before any taxpayers' money can be tapped in. It also
toughens law on foreclosures, though Tsipras pledged his government
would not allow banks to seize primary residences.
It also includes the reform of the judicial system, which is similar
to a law that Syriza had opposed before it came to power, and which
hardline Left Platform lawmakers particularly oppose.
Greece's creditors say the measure is needed to speed up court
proceedings and reduce their cost. Greek leftists say it violates
rights to a fair hearing and could favor creditors and hurt workers
in bankruptcy cases.
(Reporting by Karolina Tagaris, Costas Pitas and Angeliki Koutantou;
Writing by Deepa Babington; Editing by Ken Wills)
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