Greek parliament set to vote on second bailout reforms

GREEK legislators are set to vote on a second batch of reforms that must pass if Athens is to receive its third international bailout.

Yesterday’s vote is a key test of Prime Minister Alexis Tsipras’ authority after he suffered a major parliamentary rebellion on a cash-for-reforms deal last week, Al jazeera’s report.

A fifth of the MPs from his far left Syriza party voted against sweeping changes to Greece’s taxes, pensions and labour rules, with Tsipras forced to rely on the support of opposition legislators to get the law passed.

The prime minister said he had read all the “heroic declarations” from his critics about the path he should have taken, but insisted there was “no alternative solution”.

“I am aware of the responsibility I have taken in making a difficult compromise,” he told colleagues at a meeting on Tuesday.

Tsipras reshuffled his cabinet just before the weekend to fill the vacancies left by the legislators who were sacked after voting against the first wave of reforms. He made nine changes overall.

The second vote is less controversial than the first, with the legislators set to vote on measures including an European Union directives that guarantees bank deposits up to 100,000 euros ($108,000), as well as civil justice reforms designed to speed up legal proceedings and reduce their costs. 

The government is hoping for fewer dissidents in Wednesday’s vote, which otherwise could threaten Tsipras’ coalition government, forcing early elections.

Athens wants to see the deal hammered out by August 20, when it is due to pay $3.4bn to the European Central Bank (ECB).

The government was able to pay off billions in debt to the ECB and International Monetary Fund on Monday with about $7.8bn of emergency “bridge” funding, granted by the EU.

Tsipras received a boost on Tuesday when Standard & Poor’s raised its credit rating on Greece by two notches to CCC+ from CCC-, still in junk territory but a step in the right direction.

The credit rating agency said that the scenario of Athens defaulting on its debts was no longer inevitable in the coming year and thus the chances of Greece having to pull out of the euro were reduced, though still “high”.