Athens News Agency: News in English, 07-06-07

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From: The Athens News Agency at <http://www.ana.gr/>

CONTENTS

[01] Gov't unveils bill on funds' investments, assets

[01] Gov't unveils bill on funds' investments, assets

According to Labour and Social Securities Minister Vassilis Magginas, who took over from Savvas Tsitouridis in late April, state-affiliated funds will be allowed to invest up to 23 percent of their accumulated assets in property, stocks/bonds and securities of companies listed on the Athens Stock Exchange, under certain conditions. Additionally, a provision in the draft bill will allow funds, for the first time ever, to invest in euro zone products, in co-financing schemes of Greek state projects, leasing of properties and public-private sector partnerships.

Beyond the 23-percent level, pension funds will be allowed to invest up to 3 percent of assets in fixed term accounts, up to 1 percent in structured bonds issued by the Greek state.

Among others, funds will be allowed to set up mutual funds, individually or in groups, as well as real estate holdings companies

Funds will also be free to lend interest-bearing loans to beneficiaries, contributors and even fund employees without the lending calculated as investments.

Additionally, a framework for the hiring of qualified investment and portfolio managers is laid out.

Under the draft bill, state-run funds will be given a five-year grace period to harmonise their portfolios with the aforementioned provisions. During the five-year period, however, funds will not be allowed to purchase Greek state structured bonds.

In unveiling the bill, Magginas, a veteran New Democracy cadre, also underlined that placement in commercial banks' structured bonds will be disallowed.

Opposition reaction

"The government cannot guarantee the future of pension funds because it has very serious responsibilities for the theft that these (funds) have experienced; nor can this bill act as a screen to cloak responsibilities and illegalities," top PASOK deputy Maria Damanaki said.

On the other hand, she said PASOK will comment on the substance of the draft bill's provisions when it comes to Parliament.

On its part, the Communist Party of Greece (KKE) charged that the draft bill was "merely another step towards promoting a gambling away of funds' assets and their exploitation in order to finance big capital's goals," a KKE press release read.

Finally, Coalition of the Left (Synaspismos) leader Alekos Alavanos criticised the draft bill as opening the way for "robbery, which until now was done illegally, to be carried out legally".

According to Alavanos, pension funds were called on to cover deficits, public debt and huge arms purchases, especially from the United States, while at the same time they were being surrendered to speculative gambling and support of large private enterprises.

ANA-MPA file photo of Labour Minister Vassilis Magginas.

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