Greece’s government plans to use its
holding in companies that are publicly traded to ensure
management caps wages in line with a law passed by parliament,
Finance Minister George Papaconstantinou said.

“While the government doesn’t legislate on the issue of
listed state companies, we intend over the next few days and
after the approval of the law, to send a letter, along with the
competent ministers, to the management of the specific public
enterprises where the state has a majority or a substantial
minority holding and invite them to take comparable action,”
Papaconstantinou said yesterday during the debate on the bill.

The minister said the state would exercise its rights at
shareholder meetings to deal with companies where “one-third of
the workforce have salaries above 100,000 euros ($133,150).”

The law approved early today provides a limit on monthly
salaries at state enterprises that aren’t publicly traded,
including many of the country’s public transport companies.
Workers there will also get a 10 percent cut if they earn more
than 1,800 euros a month. The reform will affect about 89
percent of workers at state companies where wage costs often
consume revenue, according to the government.

The bill already sets out pay-cuts at Agricultural Bank of
Greece SA, in which the state owns a 77 percent stake. Salaries
above 1,800 euros will be trimmed 10 percent, while a customer-
service bonus will also be abolished. The state also cancelled
plans to add another 700 staff at the bank.

Prime Minister George Papandreou has reduced government
spending and raised taxes, to meet the conditions attached to
receiving 110 billion euros of emergency loans from the European
Union and International Monetary Fund.

The Greek state holds majority stakes in the publicly
traded port operators at Piraeus and Thessaloniki, the water
utilities for Athens and Thessaloniki, as well as Public Power
Corp., which supplies electricity in the country of 11 million
people. Greece also owns 20 percent of Hellenic
Telecommunications Organization SA.

The state has minority stakes of around 34 percent in Opap
SA, Europe’s biggest publicly traded gambling company, Hellenic
Postbank SA, Attica Bank SA and Hellenic Petroleum SA.

To contact the reporter on this story:
Maria Petrakis in Athens at
mpetrakis@bloomberg.net

To contact the editor responsible for this story:
Angela Cullen at
acullen8@bloomberg.net