• cadtm-201504-greekdebtaudit

last modified April 6, 2015 by facilitfsm


Greece
4 April 2015: a landmark in the search for the truth about the Greek debt

For the first time in Europe a committee for an audit of the debt (with citizens’ participation) was set up under the auspices of a parliament. On Saturday 4 April the president of the Hellenic parliament Zoe Konstantopoulou opened the first official session creating a debt audit committee , also called committee for the truth about the debt.

by Eric Toussaint

6 April 2015

Zoe Konstantopoulou read the decree establishing the said committee consisting of Greek and foreign members and defined its essential mission, namely identifying what part of the Greek debt is illegal, illegitimate, odious or unsustainable, in other words establishing the truth about the Greek debt, providing their findings to the Hellenic parliament, the European parliament, to the national parliaments of the EU member States as well as to the Greek and international public opinion. Zoe K. recalled the suffering imposed on the Greek people by the creditors’ demands.

Next the President of the Republic, Prokopis Pavlopoulos, made a substantial speech supporting this major initiative. Prime Minister Alexis Tsipras and some ten other ministers were also present.

The President of the Hellenic parliament invited MEP Sofia Sakorafa to take the floor. She recounted the five year trial of all those who demand an audit of the debt so as to radically reduce it have been involved in. 
Éric Toussaint, Scientific Coordinator of the international team within the committee summed up some of the questions for which the auditing committee will seek answers as it investigates the Greek debt.

The following ministers spoke up in turn: the Defence Minister Panos Kammenos (who is also President of the party of Independent Greeks); the Minister for Administrative Reforms George Katrougalos; the Minister of state for the struggle against corruption Panayotis Nikoloudis; the Minister of justice Nikos Paraskevopoulos; the Minister for European affairs Nikos Chountis; deputy defence Minister Costas Isychos; Finance Minister Yannis Varoufakis; the deputy Minister for culture Nikos Xydakis; the Minister of Infrastructure, Transport and Networks Christos Spirtzis.

The head of the Parliamentary Budget Office Panagiotis Liargkovas and the head of the Parliamentary Scientific Service Professor Pliakos also spoke. 
All mentioned essential elements for a successful auditing of the Greek debt, and all committed their ministries or departments to actively supporting the project.

Afterwards three members of the auditing committee took the floor, namely Cephas Lumina, former United Nations Independent Expert on the effects of foreign debt on the full enjoyment of all human rights; Margot Salomon, Director of the Centre for the Study of Human Rights at the London School of Economics, and Maria Lucia Fattorelli, former member of the committee auditing the debt of Ecuador and Coordinator of the Citizen Debt Audit-Brazil.

The whole session, that lasted from 2 p.m. to 7.45 p.m., was broadcast live on the Hellenic parliament television channel, which is steadily winning more viewers in the country. 
The audit committee will continue its investigation on Sunday, Monday and Tuesday. 
The Sunday session started with jurist Georges Kasamatis’ intervention. It was broadcast by the Hellenic parliament television channel: http://www.hellenicparliament.gr/En... https://parltv.live.grnet.gr/webtv/

Eric Toussaint’s speech 4th April 2015 – Hellenic parliament

The Committee will audit the Greek debt in the coming months, aimed at finding out whether part of the Greek public debt is illegitimate, illegal, odious or unsustainable.

Without claiming to be exhaustive, one can propose the following definitions:

  1. Illegitimate public debt : debt that was contracted by a government without considering the public interest, a debt contracted in favour of a privileged minority.
  2. Illegal debt : debt contracted in violation of the current legal or constitutional system.
  3. Odious public debt : granted on conditions that violate fondamental human rights (the social, economic, cultural, civic, and political rights of the people).
  4. Unsustainable public debt : debt that can only be paid back with dire consequences for the people such as a dramatic degradation of their living conditions, of access to health care or education, an increase in unemployment.

In short, debt that undermines basic human rights.

In other words, an unsustainable debt is a debt whose repayment makes it impossible for governments to guarantee to the population fundamental human rights (good public health system, good public educational system, good social protection system, decent wages and pensions, etc.)

Paragraph 9 of Article 7 of Regulation No 472/2013 of the European Parliament and of the Council of 21 May 2013 (which strongly undermines the sovereignty of the member States that have to implement adjustment policies) maintains that States subject to structural adjustment should carry out a complete audit of public debt in order to explain why indebtedness increased so sharply and to identify any irregularities. Here is the text in full: “A Member State subject to a macroeconomic adjustment programme shall carry out a comprehensive audit of its public finances in order, inter alia, to assess the reasons that led to the building up of excessive levels of debt as well as to track any possible irregularity”. |1|

Citizen participation is fundamental to a rigorous and independent audit process.

Here are some key questions that could be tackled by auditing the Greek debt.

Greek debt was at 113% of GDP in 2009 before the onset of the Greek crisis and the intervention by the IMF and the European institutions involved in the Memorandum reached 175% of GDP in 2014. How could we explain that? Are there irregularities in the huge increase of the debt?

The audit will analyse the legality and legitimacy of the so-called bail-out process.

Is it in conformity with European treaties (especially Article 125 of the Treaty on the Functioning of the EU, which prohibits EU countries from taking on the financial engagements of another EU country)?

Did it comply with normal EU decision making procedure?

Did the public lenders in 2010 (the 14 EU countries that granted Greece €53 billion of loans, the IMF, the ECB, the European Commission etc.) respect the full consent of the borrower, Greece, or was Greece acting under coercion?

Did these creditors impose one-sided conditions such as excessive interest rates on the loans? |2|
Did the 14 EU member States that each granted Greece a bilateral loan respect their own laws and constitutions, as well as those of Greece?

Another purpose is to audit the actions of the IMF. We know that at the IMF Executive Board meeting of 9 May 2010 several members of the IMF Executive Board (the Brazilian, the Swiss, the Argentine, the Indian, the Chinese members) had expressed considerable reservations regarding the loan granted by the IMF, pointing out, among other things, that Greece would not be able to repay it due to the policies that were being imposed on the country |3| . See the revelations made by The Wall Street Journal: http://blogs.wsj.com/economics/2013... See also:http://greece.greekreporter.com/201...

Recently, Paulo Nogueira Batista, one of the IMF’s executive directors, claims that all IMF board members knew that the loan was actually intended to save the French and German banks not Greece. |4| the revelations made by The Wall Street Journal: http://blogs.wsj.com/economics/2013... See also: http://greece.greekreporter.com/201...

Philippe Legrain, advisor to the President of the European Commission José Manuel Barroso in 2010 when the Troikagranted its loan, specifies that ‘IMF decision makers were overruled by the IMF Managing Director of the time, Dominique Strauss-Kahn, who was then running for the French presidency and consequently wanted to prevent French banks from facing losses. Similarly German banks had persuaded Angela Merkel that it would be terrible if ever they should lose money. So the Eurozone governments decided to pretend that Greece was only facing temporary problems.’ They had to bypass ‘an essential principle in the Maastricht Treaty, namely the no-bail out clause. The loans to Athens were not intended to save Greece but the French and German banks that had been foolish enough to grant loans to an insolvent State.’

Private European banks were thus replaced by the Troika as Greece’s main creditor as from late 2010.

Did the ECB has respected its mandate?

The audit must also evaluate whether the strict conditions imposed on Greece by the Troika in exchange for the loans it received has respected their international human rights obligations - such as the right to health care, to education, housing, social security, to a fair wage, and also freedom of association and collective bargaining.

These rights are protected by a range of conventions or other instruments at international and European level, such as the Charter of Fundamental Rights of the European Union, the European Convention on Human Rights, the European Social Charter, the two UN Human Rights Covenants, the UN Charter, the UN Convention on the Rights of the Child, the UN Convention on the Rights of Persons with Disabilities, and also the basic conventions of the International Labour Organisation (ILO).

The audit will need to verify whether, as provided for in Regulation (EU) No. 472/2013 of the European Parliament and the Council of 21 May, 2013, mentioned above, “The draft macroeconomic adjustment programme… fully observe[s] Article 152 TFEU and Article 28 of the Charter of Fundamental Rights of the European Union.” The audit must also verify whether the following passage of the Regulation is adhered to: “The budgetary consolidation efforts set out in the macroeconomic adjustment programme shall take into account the need to ensure sufficient means for fundamental policies, such as education and health care.” It must also be determined whether the following fundamental principle of the Regulation has been applied: “Article 9 of the Treaty on the Functioning of the European Union (TFEU) provides that, in defining and implementing its policies and activities, the Union is to take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion, and a high level of education, training and protection of human health.”

There are also 3 conditions proposed to define an odious debt

  • lack of consent;
  • lack of benefit to the population;
  • awareness of the lenders.

Conclusions: The Committee will audit the Greek debt in the coming months, aimed at finding out whether part of the Greek public debt is illegitimate, illegal, odious or unsustainable.

notes articles:

|1http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32013R0472

|2| The interest rates imposed in 2010-201 were between 4% and 5.5%. In 2012 they were, after protests (including from the Irish government who was also asked to pay high interest in 2010), reduced to 1%. Lowering the rate was a tacit acknowledgement by the 14 States that the interest rates were too high.

|3| See the revelations made by The Wall Street Journal: http://blogs.wsj.com/economics/2013/10/07/imf-document-excerpts-disagreements-revealed/ See also: http://greece.greekreporter.com/2013/10/08/secret-imf-report-shows-greek-bailout-worries/

|4http://www.marianne.net/on-renfloue-grece-sauver-les-banques-francaises-allemandes-100231807.html

Grèce
4 avril 2015 : Journée historique pour la recherche de la vérité sur la dette grecque

Pour la première fois en Europe un comité d’audit de la dette (avec participation citoyenne) a été mis en place sous les auspices d’un parlement. 
Le samedi 4 avril, la présidente du parlement grec, Zoe Konstantopoulou, a ouvert la séance officielle de création du comité d’audit de la dette, appelé aussi comité de la vérité sur la dette.

par Eric Toussaint

5 avril 2015

Zoe Konstantopoulou a lu le décret de création de ce comité composé de membres grecs et étrangers et en a défini la mission fondamentale : identifier la partie illégale, illégitime, odieuse ou insoutenable de la dette, en d’autres mots établir la vérité sur dette grecque, faire connaître les résultats au parlement grec, au parlement européen, aux parlements nationaux des Etats membres de l’Union européenne ainsi qu’à l’opinion publique grecque et internationale. Zoe K. A rappelé les souffrances du peuple grec causées par les politiques liées au remboursement de la dette et dictées par les créanciers.

Ensuite, le président de la république, Prokopis Pavlopoulos, a prononcé un discours de fond en apportant son soutien à cette importante initiative. Du gouvernement étaient présents Alexis Tsipras, le premier ministre, et une dizaine de ministres.

La présidente du parlement a invité à prendre la parole l’eurodéputée Sofia Sakorafa qui a rappelé le parcours de 5 années de ceux et celles qui demandaient un audit de la dette afin d’obtenir une réduction radicale de celle-ci.

Éric Toussaint, coordinateur scientifique de l’équipe internationale qui fait partie du comité d’audit a résumé partiellement les questions auxquelles le comité d’audit répondra en réalisant son enquète sur la dette grecque.

Une dizaine de ministres ont ensuite pris la parole dans l’ordre suivant : le ministre de la défense, Panos Kammenos (qui est également président du parti des Grecs indépendants) ; le ministre de la Réforme administrative, George Katrougalos ; le ministre d’État pour la lutte contre la corruption, Panayotis Nikoloudis ; le ministre de la justice, Nikos Paraskevopoulos ; le ministre aux affaires européennes, Nikos Chountis ; le vice-ministre de la défense nationale, Costas Isychos ; le ministre des finances, Yannis Varoufakis ; le vice-ministre de la culture, Nikos Xydakis ; le ministre des infrastructures, des transports et des communications, Christos Spirtzis ; le chef de l’office du contrôle du budget du parlement ; le chef du service scientifique du parlement, le professeur Pliakos. Tous ont apporté des éléments fondamentaux pour la réalisation de l’audit de la dette grecque et tous ont affirmé que leur ministère ou leur service allait activement apporter un soutien actif à sa réalisation.

Ensuite ont pris la parole 3 membres du comité d’audit : Cephas Lumina, ex-rapporteur spécial des Nations Unies sur les effets de la dette sur l’exercice des droits humains ; Margot Salomon, directrice du centre juridique de la London School of Economics et Maria Lucia Fattorelli, ex-membre du comité d’audit de la dette de l’Equateur et présidente de l’audit citoyen du Brésil.

L’ensemble de cette séance qui a commencé à midi et s’est terminée à 19h45 a été retransmise en direct par la chaîne de télévision du parlement grec qui gagne de plus en plus d’audience dans le pays.

Dimanche, lundi et mardi, se poursuivent les travaux du comité d’audit.

La session du dimanche est en cours, elle a commencé avec l’intervention du juriste Georges Kasamatis. Elle est retransmise par la chaîne du parlement : http://www.hellenicparliament.gr/En...
https://parltv.live.grnet.gr/webtv/


notes articles:

|1http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32013R0472

|2| The interest rates imposed in 2010-201 were between 4% and 5.5%. In 2012 they were, after protests (including from the Irish government who was also asked to pay high interest in 2010), reduced to 1%. Lowering the rate was a tacit acknowledgement by the 14 States that the interest rates were too high.

|3| See the revelations made by The Wall Street Journal : http://blogs.wsj.com/economics/2013/10/07/imf-document-excerpts-disagreements-revealed/ See also : http://greece.greekreporter.com/2013/10/08/secret-imf-report-shows-greek-bailout-worries/

|4http://www.marianne.net/on-renfloue-grece-sauver-les-banques-francaises-allemandes-100231807.html


Grecia
4 de abril 2015: Jornada histórica para la búsqueda de la verdad sobre la deuda griega

Por primera vez en Europa un comité de auditoría de la deuda (con participación ciudadana) ha sido convocado bajo los auspicios de un parlamento.

El sábado cuatro de abril, la presidenta del Parlamento griego, Zoe Konstanstopoulou, abrió la sesión oficial de creación del comité de auditoría de la deuda, llamado también comité de la verdad sobre la deuda.

por Eric Toussaint

5 de abril de 2015

Zoe Konstatopoulou leyó el decreto de creación de este comité compuesto de miembros griegos y extranjeros y definió su misión fundamental: identificar la parte ilegal, ilegítima, odiosa o insostenible de la deuda, en otras palabras establecer la verdad sobre la deuda griega, hacer conocer sus resultados al Parlamento griego, al Parlamento Europeo, a los parlamentos nacionales de los Estados miembros de la Unión Europea, así como a la opinión pública griega e internacional. Z. Konstantopoulou recordó el sufrimiento del pueblo griego causado por las políticas ligadas al rembolso de la deuda y dictadas por los acreedores.

A continuación, el presidente de la República, Prokopis Pavlopoulos, pronunció un discurso de fondo dando su apoyo a esta importante iniciativa. Por parte del gobierno estaban presentes Alexis Tsipras, el primer ministro, y una decena de ministros.

La presidenta del Parlamento invitó a la eurodiputada Sofía Sakorafa a tomar la palabra. Recordó el recorrido de cinco años de aquellos que piden la auditoría de la deuda para obtener una reducción radical de ésta.

Eric Toussaint, coordinador científico del equipo internacional del comité de auditoría, resumió una parte de las cuestiones a las cuales el comité responderá en su investigación de la deuda griega.

Los ministros tomaron a continuación la palabra en el orden siguiente: el Ministro de Defensa, Panos Kammenos (que es también el presidente del partido de los Griegos Independientes); el Ministro de Reforma Administrativa, Georgios Katrougalos; el Ministro de Estado para la lucha contra la Corrupción, Panayotis Nikoloudis; el Ministro de Justicia, Nikos Paraskevopoulos; el Ministro de Asuntos Europeos, Nikos Chountis; el Viceministro de Defensa Nacional, Costa Isychos; el Ministro de Finanzas, Yannis Varoufakis; el Viceministro de Cultura, Nikos Xydakis; el Ministro de Infraestructuras, de Transportes y Comunicaciones, Christos Spirtzis.

El jefe de la Oficina de control del Presupuesto del Parlamento, y el jefe del servicio científico del Parlamento, el profesor Pliakos, intervinieron igualmente.

Todos aportaron elementos fundamentales para la realización de la auditoría de la deuda griega y todos afirmaron que su ministerio o su departamento aportarían un apoyo activo a su realización.

A continuación tomaron la palabra tres miembros del comité de auditoría : Cephas Lumina, antiguo ponente especial de las Naciones Unidas sobre los efectos de la deuda en el ejercicio de los Derechos Humanos ; Margot Salomon, directora del centro jurídico de la London School of Economics, y Maria Lucia Fattorelli, antiguo miembro del comité de auditoría de la deuda de Ecuador y presidente de la auditoría ciudadana en Brasil.

La sesión completa, que se desarrollón de 12 a 19:45, fue retransmitida en directo por la cadena de televisión del Parlamento Griego que gana cada vez más audiencia en el país.

Domingo, lunes y martes continúan los trabajos del comité de auditoría. Vease:http://www.hellenicparliament.gr/En...
https://parltv.live.grnet.gr/webtv/
Lunes 6 de Abril, hablaran los ministros: P. Lazanis, R. Antonopoulou, N. Valavani,...

Eric Toussaint’s speech 4th April 2015 – Hellenic parliament

The Committee will audit the Greek debt in the coming months, aimed at finding out whether part of the Greek public debt is illegitimate, illegal, odious or unsustainable.

Without claiming to be exhaustive, one can propose the following definitions:

  1. Illegitimate public debt : debt that was contracted by a government without considering the public interest, a debt contracted in favour of a privileged minority.
  2. Illegal debt : debt contracted in violation of the current legal or constitutional system.
  3. Odious public debt : granted on conditions that violate fondamental human rights (the social, economic, cultural, civic, and political rights of the people).
  4. Unsustainable public debt : debt that can only be paid back with dire consequences for the people such as a dramatic degradation of their living conditions, of access to health care or education, an increase in unemployment.

In short, debt that undermines basic human rights.

In other words, an unsustainable debt is a debt whose repayment makes it impossible for governments to guarantee to the population fundamental human rights (good public health system, good public educational system, good social protection system, decent wages and pensions, etc.)

Paragraph 9 of Article 7 of Regulation No 472/2013 of the European Parliament and of the Council of 21 May 2013 (which strongly undermines the sovereignty of the member States that have to implement adjustment policies) maintains that States subject to structural adjustment should carry out a complete audit of public debt in order to explain why indebtedness increased so sharply and to identify any irregularities. Here is the text in full: “A Member State subject to a macroeconomic adjustment programme shall carry out a comprehensive audit of its public finances in order, inter alia, to assess the reasons that led to the building up of excessive levels of debt as well as to track any possible irregularity”. |1|

Citizen participation is fundamental to a rigorous and independent audit process.

Here are some key questions that could be tackled by auditing the Greek debt.

Greek debt was at 113% of GDP in 2009 before the onset of the Greek crisis and the intervention by the IMF and the European institutions involved in the Memorandum reached 175% of GDP in 2014. How could we explain that? Are there irregularities in the huge increase of the debt?

The audit will analyse the legality and legitimacy of the so-called bail-out process.

Is it in conformity with European treaties (especially Article 125 of the Treaty on the Functioning of the EU, which prohibits EU countries from taking on the financial engagements of another EU country)?

Did it comply with normal EU decision making procedure?

Did the public lenders in 2010 (the 14 EU countries that granted Greece €53 billion of loans, the IMF, the ECB, the European Commission etc.) respect the full consent of the borrower, Greece, or was Greece acting under coercion?

Did these creditors impose one-sided conditions such as excessive interest rates on the loans? |2|
Did the 14 EU member States that each granted Greece a bilateral loan respect their own laws and constitutions, as well as those of Greece?

Another purpose is to audit the actions of the IMF. We know that at the IMF Executive Board meeting of 9 May 2010 several members of the IMF Executive Board (the Brazilian, the Swiss, the Argentine, the Indian, the Chinese members) had expressed considerable reservations regarding the loan granted by the IMF, pointing out, among other things, that Greece would not be able to repay it due to the policies that were being imposed on the country |3| . See the revelations made by The Wall Street Journal: http://blogs.wsj.com/economics/2013... See also:http://greece.greekreporter.com/201...

Recently, Paulo Nogueira Batista, one of the IMF’s executive directors, claims that all IMF board members knew that the loan was actually intended to save the French and German banks not Greece. |4| the revelations made by The Wall Street Journal: http://blogs.wsj.com/economics/2013... See also: http://greece.greekreporter.com/201...

Philippe Legrain, advisor to the President of the European Commission José Manuel Barroso in 2010 when the Troikagranted its loan, specifies that ‘IMF decision makers were overruled by the IMF Managing Director of the time, Dominique Strauss-Kahn, who was then running for the French presidency and consequently wanted to prevent French banks from facing losses. Similarly German banks had persuaded Angela Merkel that it would be terrible if ever they should lose money. So the Eurozone governments decided to pretend that Greece was only facing temporary problems.’ They had to bypass ‘an essential principle in the Maastricht Treaty, namely the no-bail out clause. The loans to Athens were not intended to save Greece but the French and German banks that had been foolish enough to grant loans to an insolvent State.’

Private European banks were thus replaced by the Troika as Greece’s main creditor as from late 2010.

Did the ECB has respected its mandate?

The audit must also evaluate whether the strict conditions imposed on Greece by the Troika in exchange for the loans it received has respected their international human rights obligations - such as the right to health care, to education, housing, social security, to a fair wage, and also freedom of association and collective bargaining.

These rights are protected by a range of conventions or other instruments at international and European level, such as the Charter of Fundamental Rights of the European Union, the European Convention on Human Rights, the European Social Charter, the two UN Human Rights Covenants, the UN Charter, the UN Convention on the Rights of the Child, the UN Convention on the Rights of Persons with Disabilities, and also the basic conventions of the International Labour Organisation (ILO).

The audit will need to verify whether, as provided for in Regulation (EU) No. 472/2013 of the European Parliament and the Council of 21 May, 2013, mentioned above, “The draft macroeconomic adjustment programme… fully observe[s] Article 152 TFEU and Article 28 of the Charter of Fundamental Rights of the European Union.” The audit must also verify whether the following passage of the Regulation is adhered to: “The budgetary consolidation efforts set out in the macroeconomic adjustment programme shall take into account the need to ensure sufficient means for fundamental policies, such as education and health care.” It must also be determined whether the following fundamental principle of the Regulation has been applied: “Article 9 of the Treaty on the Functioning of the European Union (TFEU) provides that, in defining and implementing its policies and activities, the Union is to take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion, and a high level of education, training and protection of human health.”

There are also 3 conditions proposed to define an odious debt

  • lack of consent;
  • lack of benefit to the population;
  • awareness of the lenders.

Conclusions: The Committee will audit the Greek debt in the coming months, aimed at finding out whether part of the Greek public debt is illegitimate, illegal, odious or unsustainable.

notes articles:

|1http://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:32013R0472

|2| The interest rates imposed in 2010-201 were between 4% and 5.5%. In 2012 they were, after protests (including from the Irish government who was also asked to pay high interest in 2010), reduced to 1%. Lowering the rate was a tacit acknowledgement by the 14 States that the interest rates were too high.

|3| See the revelations made by The Wall Street Journal: http://blogs.wsj.com/economics/2013/10/07/imf-document-excerpts-disagreements-revealed/ See also: http://greece.greekreporter.com/2013/10/08/secret-imf-report-shows-greek-bailout-worries/

|4http://www.marianne.net/on-renfloue-grece-sauver-les-banques-francaises-allemandes-100231807.html


-- 

Eric Toussaint
www.cadtm.org
345 Avenue de l'Observatoire
4000 Liège
Belgique