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Greek bailout: Alexis Tsipras 'to call snap elections' Greek bailout: Alexis Tsipras to 'step down and call snap elections'
(35 minutes later)
The Greek prime minister, Alexis Tsipras, is due to call snap elections on Thursday, sending voters back to the polls as early as next month, according to the state television broadcaster in Athens. The Greek prime minister, Alexis Tsipras, has decided to step down and call snap elections for 20 September, government officials said.
As the debt-crippled country received the first tranche of its new €86bn (£61bn) bailout, Tsipras was reportedly holding discussions in parliament with his closest aides and expected to make an announcement by early evening. As the debt-crippled country received the first tranche of its new €86bn (£61bn) bailout, Tsipras was set to make the formal announcement later on Thursday, government sources told Reuters..
The prime minister won parliamentary backing for the tough bailout programme last week despite a large-scale rebellion among members of his ruling left-wing Syriza party, nearly one-third of whose 149 MPs either voted against the deal or abstained. Syriza rules in a coalition with the right-wing, anti-austerity party Independent Greeks (Anel). Related: Greek PM to call snap elections next month - live updates
The revolt by hardliners angry at what they saw as a betrayal of the party’s pledge to fight austerity left Tsipras short of the 120 votes he would need – two-fifths of the 300-seat assembly – to survive a censure motion and he was widely expected to call a confidence vote this week or next. Once he submits his resignation the prime minister would be replaced by the president of Greece’s supreme court, Vassiliki Thanou-Christophilou – a vocal bailout opponent – who would oversee the elections as the head of a transitional government.
But government sources signalled he may now skip that step and go straight to the country, in an attempt to silence rebels and shore up support for the three-year bailout programme. This entails a radical overhaul of the Greek economy including further tax hikes, spending cuts and major reforms of health, welfare, pensions and taxation. Tsipras won parliamentary backing for the tough bailout programme last week by a comfortable margin despite a large-scale rebellion among members of his ruling leftwing Syriza party, nearly one-third of whose 149 MPs either voted against the deal or abstained. Syriza governs in a coalition with the rightwing, anti-austerity party Independent Greeks (Anel).
“Everything is possible,” an official told reporters when asked about possible early elections. The state broadcaster, ERT, predicted an announcement later on Thursday. The Greek constitution allows elections to be held at a month’s notice, making mid- or late September likely dates for a poll. The revolt by hardliners angry at what they view as a betrayal of the party’s pledge to fight austerity left Tsipras short of the 120 votes he would need – two-fifths of the 300-seat assembly – to survive a censure motion and he was widely expected to call a confidence vote this week or next.
Tsipras could also decide to wait until early October for the vote, by which time Greece’s creditors would have carried out their first review of the country’s progress in meeting the bailout conditions. They may have also come to a decision about debt relief - potentially a major electoral asset for the prime minister. He has now decided to skip that step, deciding instead to go straight to the country in an attempt to silence rebels and shore up public support for the draconian three-year bailout programme, which entails a radical overhaul of the Greek economy including further tax hikes, spending cuts and major reforms of health, welfare, pensions and taxation.
In either event, the president of Greece’s supreme court, Vassiliki Thanou-Christophilou, a vocal opponent of Greece’s bailouts, was expected to be appointed caretaker prime minister to oversee a transitional government. Tsipras appears to have calculated that it was better to call the elections early, before the effects of the new bailout measures – including further pension cuts, VAT increases and a “solidarity” tax on incomes – started to make themselves felt.
At the end of a bruising seven months of negotiations with Greece’s international creditors, the prime minister eventually signed up to a deal that many in his party see as a U-turn on the anti-austerity platform that saw it sweep to power in elections last January. Related: Greek bailout Q&A: What happens next?
Tsipras has insisted that accepting creditor demands for yet more tough reforms was the only way to ensure his country remains in the eurozone, which is a key demand among the electorate according to opinion polls. Some analysts had suggested he might wait until early October, by which time Greece’s creditors would have carried out their first review of the country’s progress in meeting the bailout conditions and perhaps come to a decision about debt relief – potentially a major electoral asset for the prime minister.
But Syriza is now thought to be likely to formally split. The leader of its dissident Left Platform, the former energy minister Panagiotis Lafazanis, last week announced he intended to form a new anti-bailout movement, accusing the government of capitulating to the “dictatorship of the eurozone”. Under Greece’s complex constitutional laws, President Prokopis Pavlopoulos cannot immediately call an election if Tsipras resigns, but must first consult the other major parties to see if they could form a government – a near impossibility given the current parliamentary arithmetic.
Analysts have suggested Tsipras has every interest in calling early elections, to sideline his hardliners, capitalise on the disarray of the centre-right and profit from his own popularity ratings, which for the moment remain strong. But that situation that may well change as the punishing effects of the latest rescue programme, including pension cuts and VAT increases, start to become apparent. At the end of a bruising seven months of negotiations with Greece’s international creditors, the prime minister eventually signed up to a deal that many in his party view as a U-turn on the anti-austerity platform that swept it to power in elections last January.
The country’s energy minister and close Tsipras adviser, Panos Skourletis, said on Thursday that the divisions within Syriza had to be dealt with one way or another. “The political landscape must clear up. We need to know whether the government has or does not have a majority,” he told ERT. Related: Greece crisis timeline: the rocky road to another bailout
Syriza is thought to be likely to call a party congress in September to resolve its internal differences, but Skourletis said Tsipras should try to move faster. “I would say elections first, then the party congress,” he said. Tsipras has insisted that accepting creditor demands for further tough reforms was the only way to ensure his country remains in the eurozone, which is a key demand among the electorate according to opinion polls.
An opinion poll last month put support for Syriza at 33.6%, making it by far the country’s most popular party – but not popular enough to govern without a coalition partner. No polls have been published since then, but Syriza insiders remain optimistic. Syriza is now thought likely to formally split. The leader of its dissident Left Platform, the former energy minister Panagiotis Lafazanis, announced last week he intended to form a new anti-bailout movement, accusing the government of capitulating to the “dictatorship of the eurozone”.
Dimitris Papadimoulis, a Syriza MEP, told Mega TV: “These elections, whenever they are announced by the government, will provide a stable governing solution. My feeling is that Syriza will have an absolute majority,.” The prime minister’s closest aides had said on Thursday that the divisions within Syriza had to be dealt with one way or another. The energy minister, Panos Skourletis, told state broadcaster ERT: “The political landscape must clear up. We need to know whether the government has or does not have a majority.”
The political uncertainty was taking its took its toll on markets, with the Athens Stock Exchange down 2.8% in afternoon trading. The party is now thought likely to call an extraordinary congress in September to resolve its internal differences.
Aanalyst Evangelos Sioutis, who is the head of equities at Guardian Trust Securities, said: “The Greek stock market is coming into a new circle of uncertainty while we are waiting for new elections to be announced. For the stock markets, it is a factor of uncertainty.” Recent opinion polls have put support for Syriza at around 33-34%, making it by far the country’s most popular party – but not popular enough to govern without a coalition partner. No polls have been published since then, but Syriza insiders remain optimistic.
Dimitris Papadimoulis, a Syriza MEP, told Mega TV: “These elections, whenever they are announced by the government, will provide a stable governing solution. My feeling is that Syriza will have an absolute majority.”
The political uncertainty was taking its toll on markets, with the Athens Stock Exchange down 2.8% in afternoon trading.
Analyst Evangelos Sioutis, who is the head of equities at Guardian Trust Securities, said: “The Greek stock market is coming into a new circle of uncertainty while we are waiting for new elections to be announced. For the stock markets, it is a factor of uncertainty.”