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Greece braces for key vote on fresh austerity measures Greece braces for key vote on fresh austerity measures
(about 1 hour later)
Greek Prime Minister Antonis Samaras has pleaded with politicians to vote through a fresh round of austerity measures crucial to securing the country's next round of financial aid. Greek Prime Minister Antonis Samaras has pleaded with politicians to vote through a fresh round of austerity measures crucial to securing the country's next round of bailout funds.
Parliament will vote later on 13.5bn euros ($17.3bn; £10.5bn) of spending cuts, which include tax increases and cuts to pensions. Parliament will vote later on 13.5bn euros ($17.3bn; £10.5bn) of measures, including tax rises and pension cuts.
"We have to save the country from catastrophe," Mr Samaras said. Greek unions are planning to mass outside parliament in protest.
Without the aid, Mr Samaras says Greece will run out of money by 15 November. Mr Samaras said without the bailout aid, the country would run out of money by 15 November and face "catastrophe".
The fresh package of spending cuts - Greece's fourth in three years - includes a two-year increase in the retirement age from the current average of 65; salary and pension cuts and another round of tax increases. The fresh package of austerity measures - Greece's fourth in three years - is meant to close Greece's budget deficit, lower its huge debt burden and make its economy more competitive.
Strikes It includes a two-year increase in the retirement age from the current average of 65, as well as salary cuts and labour market reforms including cuts to holiday benefits, notice periods and severance pay.
The vote on these cuts will be followed by a second vote this Sunday on Greece's revised budget for 2013. Workers fear this will just make it easier and cheaper for them to be fired at a time when unemployment has already soared to 25% and a five-year recession means there are few job prospects.
A positive vote on both the austerity measures and the budget is required for Greece to secure 31.5bn euros in fresh loans from the European Union (EU) and the International Monetary Fund (IMF). The unions have staged what they described as the "mother of all strikes" - a 48-hour walkout which culminates on Wednesday evening with protests outside parliament in Athens.
The third major strike in just two months has brought public transport to a halt and shut schools, banks and government buildings.
Alexis Tsipras, leader of the left-wing opposition party Syriza, said: "The bailout policies are completely catastrophic, outrageously absurd, and an utter failure.
"Let's not kid ourselves. The bailouts can no longer be acceptable, not even under the toughest blackmail," he told the Efimerida Syntakton newspaper.
Tight vote
Wednesday's vote on the cuts will be followed by a second vote this Sunday on Greece's revised budget for 2013.
A positive vote on both is required for Greece to secure 31.5bn euros in fresh loans from the European Union (EU) and the International Monetary Fund (IMF).
Mr Samaras has said without this money, which will be used largely to recapitalise the country's banks, the country will be bankrupt by the middle of the month.Mr Samaras has said without this money, which will be used largely to recapitalise the country's banks, the country will be bankrupt by the middle of the month.
The prospect of further cuts has enraged Greece's two biggest labour unions, representing half the four million-strong workforce, which started what they described as the "mother of all strikes" on Tuesday. However, the Democratic Left Party, which is the junior member of the three-party governing coalition, is refusing to back the austerity package.
The 48-hour strike, the third major walkout in just two months, has bought public transport across Greece to a halt. The second biggest coalition party, the socialist Pasok, is also facing a rebellion by some of its MPs.
Despite the opposition, analysts are optimistic the fresh cuts will be approved.Despite the opposition, analysts are optimistic the fresh cuts will be approved.
"There is some uncertainty, but the likelihood is that the measures will be passed by a narrow majority," said IHS Global Insight economist Diego Iscaro. Mr Samaras is believed to have the support of about 154 votes in the 300-seat parliament, assuming there are no more defections.