The Greek payment deadlines ahead

Discussions between Greece and its creditors are due to restart. In the meantime, the pressure on Greece is increasing.   Here we take a look at the relevant deadlines ahead for the Greek State coffers.

Redemptions to official creditors

Ordinary State expenditures

Beyond repayments to official creditors, the Greek government also needs to meet its ordinary primary expenditures during the year, so it is useful to have an idea of what these are and how much they account for. According to the 2015 budget published in November 2014 (unfortunately available in Greek only) the ordinary primary expenditure at the State level is expected to be about 42 billion for the entire year. Total expenditures are expected to be 56 billion at the State level (see figures in the most recent the budget execution bulletin).

About 78% of the State ordinary primary expenditure is accounted for by payments of wages, salaries and pensions as well as of insurance, health care and social protections. An indicative monthly distribution of expenditures provided in the 2015 budget suggests that in March the government will need to pay about 1.5 billion in salaries and pensions and 1.3 billion in insurance, healthcare and social protection (with similar payments foreseen over the following months, see also Macropolishere). These are expenditure items that are not easy to avoid or reduce in the case of liquidity shortage, at least not without having a significant  social and economic impact.

According to a recent interview, finance minister Varoufakis suggested that the situation is not as rosy as previously thought:   “I can only say that we have money to pay salaries and pensions of public employees. […] For the rest we will see”. Kathimerini reported yesterday that the General Accounting Office has blocked any state expenditure not related to salaries and pensions. The same article reports a government official as saying that the budget has 4,772 expenditure categories – not salary-related – and that a review has allegedly saved about 180 million.

Recent analyses by Macropolis suggest that the government can rely on a number of sources in the very short term. Following two recent ministerial decisions, it could utilize cash reserves of 250 million euros from OPEKEPE, e organisation responsible for managing Common Agricultural Policy aid, and 114 million from the Hellenic Telecommunications and Post Commission (EETT). On top of that, the Bank of Greece’s financial accounts show that the profits for 2014 amount to 641 million euro which, according to Macropolis, were also transferred to the government at the end of February. Possibly, 500 million more could come from a fund in the Hellenic Financial Stability Facility which, according to recent news, could be drawn upon subject to a law amendment.

Altogether, this adds up to 1 billion, which could  be precious to Greece in the course of this month, but it does not seem to be a game changer if agreement is not struck.