How much do party programs cost the budget? The answer could be a useful guide for voters, as it will show whether a party running for power is prudently abiding by European financial discipline rules, which are returning from 2024, or whether it is turning away from them.

Billionaire ads demonstrate a “normality” that doesn’t exist. As Bank of Greece Governor Yannis Sturnaras explained in an interview last week in Imerissia, Greece is an over-indebted country that must return to a primary surplus of 2% of GDP in order to have sustainable debt. while it is still in investment grade. “We do not have the financial capacity to issue all these campaign statements,” the head of the central bank said.

The parties bidding on the announcements also seem to be oblivious to the fact that in the coming years there will be no repeat of the “little miracles” of 2022 with a strong recovery from the energy crisis and even higher inflation, savings in income and debt. and led to a small primary budget surplus. Financial conditions will become difficult and interest rates will be high.

However, to this simple and fundamental question about the cost of programs and how it will be covered, there are no generally accepted answers from the two main parties claiming power. None of them provided a list of proposed measures and their cost over a four-year period. A list, for example, like the one that contains the budget every year, with support measures against the pandemic or energy costs or other interventions that no one disputes.

New Democracy, which supports a proposal to control the cost of party programs by an independent body, has announced, at least through Deputy Minister Theodoros Skilakakis, a series of interventions, most of which cost €9.4bn over four years. -year period and an average of 2.350 billion per year.

There are no official figures for SYRIZA, only the unofficial cost of the measures announced by its President Alexis Tsipras at TIF in 2022, which is 9.3 billion for 2023 (not four years), according to his own calculations. SYRIZA itself claims that these expenses will be capped at €5.6bn, as it will tax excess profits, mainly from energy companies, which will bring it €3.7bn. Except that the windfall will not repeat every year, so the value will inevitably return to the €9.3bn range.

Also, this list of SYRIZA spending does not include the announcement of an increase in health care spending to 7.5% of GDP (or 7%, according to the latest statement by Al. Tsipras) in the amount of 4.7 billion euros (or 3.7 billion euros, respectively) and education by 5%. GDP worth 4.3 billion euros, according to the calculations of the current government.

The government understandably adds these amounts to the cost of the SYRIZA 2023 activities and amounts to a total of €19.7 billion for this year and the corresponding amounts for subsequent years, so that the total cost of the program is €83 billion. for a four year period. The truth is that SYRIZA states in its program that increasing health spending to 7%-7.5% of GDP is the ultimate goal, and therefore it can be assumed that this will be done gradually and that in any case the program will be implemented. taking into account the fiscal potential of the Greek economy”.

If the party of the current official opposition means that it will implement its program taking into account the fiscal possibilities of the Greek economy, it should erase it and rewrite it from the very beginning, since these possibilities leave no room for measures greater than 0.3. % of GDP, about 600 million euros, at least according to the Stability Program.

Who are the programs aimed at?

New Democracy is trying to send a message of support for middle-income groups as well as financial accountability with its program, while SYRIZA is betting on accuracy checks, wage increases and social policies while keeping its meters free.

However, the favorite targets of both sides are civil servants and pensioners. N.D. promises a new list of salaries of civil servants worth 500 million euros, indexation of salaries of civil servants SYRIZA almost three times more expensive than 1.3 billion euros. For pensioners, the government undertakes to give increases provided for by law, i.е. equal to the average rate of inflation and GDP growth, which is estimated at 1.1 billion euros in 2026. SYRIZA promises more than double the amount: retroactively in 3 installments (for a total cost of 2.5 billion euros and an annual cost of 830 million euros), a 13th pension worth 830 million euros, a pension increase of 600 million euros (the government says that the cost will be 1.1 billion euros, given that personal differences will not be taken into account, as announced by SYRIZA).

The meeting point of the two sides is also the abolition of the sham tax.

Other measures by the current government are of relatively limited cost, although more and more new provisions are being added where we thought the announcements were over. On the contrary, SYRIZA still has two boulders: a €1.5bn reduction in the excise tax on fuels (the government says the cost is €2bn) and a €960m VAT cut on food (the government says 1. 5 billion euros). billion euros). The government has repeatedly opposed these measures, arguing that the benefit will be largely lost to the supply chain and not to the consumer, and that the measure is not targeted as it benefits rich and poor alike.

“I understand that in the run-up to the elections, many people say things that will not be implemented, because if we correctly assess what is being said, we will go far beyond any fiscal space,” Mr. Sturnaras commented in an interview. Imericia was approached last week with a clear warning about excess benefits.

The new Stability Pact is estimated to definitely require primary surpluses of 2% of GDP, if not higher than 2.3%-2.4% of GDP. The stability program presented by the government, with no new measures other than 500 million euros for new salaries for civil servants and an increase in pensions, which is already provided for by law (and which ND includes in its announcements), leads to a budget surplus of 2-2.3% of GDP . ND measures barely “fit”. and certainly not SYRIZA. Even if they were capped at 5.6 billion euros, they would send us back to the primary deficit, which completely eliminates any prospect of debt sustainability.