The ministry was responding to accusations from opposition DISY vice chairman Averof Neophytou and government partner DIKO MP Nicolas Papadopoulos that the government had engaged in accounting “alchemy” to present a better picture of the economy.
Neophytou yesterday charged that the government had postponed certain 2010 payments for 2011 and showed 2012 revenues this year, suggesting the government lacked credibility.
The DISY official said farmers are complaining because they have not received their subsidies in time, for the first time in seven years, while police officers have not yet been paid their overtime.
Neophytou also claimed that contractors and other people who do business with the state also remain unpaid.
The country’s problems are not the fiscal deficits. “The country’s big problems are the credibility deficits created by this government,” Neophytou said.
In its written response, the finance ministry expressed its displeasure and regret at the insistence of “certain political forces to try and highlight inexistent accounting alchemy through inaccurate references and presentation of data in a completely misleading way.”
The ministry said the funds for the farmers’ subsidies had been released by the state but were not withdrawn by the relevant organisation, for “management reasons”.
This, the ministry said, does not affect the calculation of the 2010 public deficit in any way.
The ministry also rejected claims that it borrowed money from semi-government organisations and presented them as revenues.
“It is stressed once more that government borrowing does not affect the public deficit,” the statement said. “As we have already explained to the chairman of the House Finance Committee (Papadopoulos), based on the methodology of the European Statistical Service, ... borrowing from semi-government organisations is not taken into consideration when calculating the public deficit.”
And Papadopoulos’ claim that for the first time the government has borrowed money from the Game Fund and the Human Resources Development Authority (HRDA) is “untrue”, the ministry said.
“The committee chairman should have known that these organisations had always invested their surpluses in government bonds,” the ministry said.
At the end of 2007, the Game Fund had €4.0 million invested in government bonds while the HRDA had €14 million.
“As we have already said, these investments also do not affect the calculation of the public deficit in any way,” the ministry said.
The ministry said it was surprised by Papadopoulos’ suggestion that the public debt had gone up despite the public deficit remaining within the government’s target.
“He should have also known that the public deficit is financed through borrowing and inevitably, any deficit, either on target or not, can only raise the public debt,” the ministry said.
Greece got away with it for only so long!!!!
