Greek PM does not rule out early elections

Greek Prime Minister George Papandreou did not rule out yesterday that he could call early elections if his party is weakened in coming local elections and has trouble enacting a debt reform programme.

“I have no reason and no intention to go to national elections,” the prime minister told journalists from the main Greek television channels in a nationally televised interview.

“(But) if I see that there is deadlock in the country, there is no deadlock in democracy, the people has the power to decide,” he said.

“Everything will be taken into consideration.”

Mr Papandreou argued that local elections on November 7 and 14 are crucial to the country’s recovery from near-bankruptcy as local officials have additional powers under a new administrative system adopted earlier this year.

“The country needs stability more than ever,” he said.

“Never before have we voted for officials with such powers of intervention. I want a vote that will provide a push forward.”

The ruling party looks unlikely to wrest the main cities of Athens and Thessaloniki from the opposition conservatives, and polls show it could also lose the greater Athens region to a Socialist rebel.

Greece came close to default earlier this year and had to be rescued by the European Union and the International Monetary Fund with a massive loan.

It has had to adopt painful austerity measures to cut a runaway deficit and reduce a debt of around €300 billion.

Sweeping tax hikes and pay and pension cuts have sparked six general strikes this year and a wave of protests, some of them violent.

The European Union has indicated that more sacrifices may have to be made after the elections when EU data agency Eurostat is scheduled to release a revised estimate of the Greek deficit that takes indebted state companies into account.

But Papandreou insisted yesterday that the deficit targets would be met with taxes on the rich and better state management, not by new cuts on wages and pensions.

“There will be no new measures compromising salaries and pensions... I tell you where our red line lies.”

Mr Papandreou came to power in October last year and his Socialist party currently has a seven-seat majority in the 300-member Parliament.