Strikes and record unemployment as Greece passes austerity bill

A protester holds Greek, Spanish, Irish and flags during a demonstration in front of the parliament in Athens, Wednesday Nov. 7, 2012. Greeces fragile coalition government faces its toughest test so far when lawmakers vote later Wednesday on new painful austerity measures demanded to keep the country afloat, on the second day of a nationwide general strike. The 13.5 billion euro ($17.3 billion) package is expected to scrape through Parliament, following a hasty one-day debate. (AP Photo/Lefteris Pitarakis)

The Greek parliament passed a new round of austerity measures on Thursday, as work stoppages continued and newly released unemployment figured showed a record high of 25.4 per cent.

The austerity measures were a precondition for the next round of international aid for the struggling country - a 31.5-billion-euro instalment that hinges on the approval of the 2013 budget, which comes up for a vote on Sunday.

Hours after Greek lawmakers voted 153-128 for the package of spending cuts and tax increases, transport remained paralysed in Athens as the metro, suburban railway and taxis continued rolling 24-hour strikes, causing major traffic jams.

Meanwhile, the release of official unemployment figures from the state statistics agency ELSTAT showed a record high of 25.4 per cent for August, rising from 24.8 per cent in July and 18.4 per cent a year ago.

The worst affected was the 15-24 age group, with unemployment reaching 58 per cent, followed by the 35-44 age group at 41 per cent and the 25-34 age group with 32.9 per cent.

The unpopular budget cuts, worth 13.5 billion euros, were approved by lawmakers from only two of the three parties in the ruling coalition, with heavy dissent from within party ranks.

Seven lawmakers were expelled from the conservative New Democracy and socialist PASOK parties after failing to back the measures.

Parliament’s approval of the bill nevertheless represents a major political victory for Greek Prime Minister Antonis Samaras. Without the next round of bailout cash, the country will run out of money by November 16, the government has said.

Many Greeks fear the bill will deliver a further blow to the country’s fragile economy, which is about to enter a sixth year of recession.

The measures include additional pension and public-sector cuts and tax hikes, a two-year increase in the retirement age - to 67 - and legislation that will make it easier to sack civil servants. The law gives the government the right to cut the minimum wage, reduces the redundancy notice period and limits compensation for workers with more than 16 years of service.

The measure also gives shop owners the right to ask employees to work more flexible hours, paving the way for Sunday openings.