Greece hit by strikes as workers vent fury over cuts and tax rises

Public transport workers, taxi drivers, teachers and air traffic controllers walked out yesterday, causing widespread disruption.

The action came a day after the government announced yet another round of spending cuts, including plans to suspend 30,000 civil servants as it scrambles to keep international bail-out payments flowing and soothe global market fears that Greece will default.

Without continued payments from a 110 billion euro (£96bn) programme of rescue loans from eurozone countries and the International Monetary Fund, the heavily indebted eurozone member will run out of cash by mid-October.

Athens has lagged behind savings and revenue targets set in its bail-out agreement, angering international debt inspectors who threatened to halt the loans – as the country heads for a fourth year of recession with rising unemployment.

The inspectors are due back in Athens next week to complete a review on whether Greece has done enough to be granted the next eight billion euro (£7bn) instalment of the bail-out loans.

“The situation is extremely critical, I would say dangerous,” Finance Minister Evangelos Venizelos told the country’s president, Karolos Papoulias, during a meeting to brief him on the latest developments. “There is a sense of nervousness among the larger eurozone members... that is affecting us.”

Venizelos, who heads to Washington today to attend the annual International Monetary Fund meeting and meet IMF head Christine Lagarde, said Greece was also being affected by problems in other eurozone countries.

“Unfortunately the eurozone at this moment falls short of the political and institutional level required” to deal with the crisis, he said.

But he also stressed it was up to Greeks to pull themselves out of the crisis.

“If we want to save the country ... we must keep our heads down and work,” he said. “Because the miracle needed to save the country is in our hands. What is needed is work, work, work.”

With all forms of public transport, including the metro, buses, trams, trains and taxis on strike, Athenians struggled through traffic-clogged streets to make their way to work on what was designated World Car-free Day.

Air traffic controllers walked off the job for three hours in the afternoon, forcing airlines to cancel or reschedule dozens of international and domestic flights.

Schoolteachers were also on strike and students planned a demonstration in central Athens.

“We’ve already had one round of firings, and now they will have another,” Yiannis Vlachos, head of a railway workers’ union in northern Greece, said during a demonstration.

“This has got to a critical point for our operations, since we cannot make the slightest compromise for passenger safety.”

Under intense pressure to meet fiscal targets, the government on Wednesday said it would cut monthly pensions by 20 per cent above a 1,200 euro (£1,051) threshold, while retirees aged under 55 will lose 40 per cent of their pensions above 1,000 euros (£875).

The tax-free annual income limit will be cut to 5,000 euro (£4,380) from 8,000 euro (£7,000) as of this year, while the number of civil servants to be suspended on partial pay will rise to 30,000 by the end of this year, from 20,000 planned initially.

After a year of forced idleness on 60 per cent of their basic salaries, these workers will either be shifted to other state jobs or fired – despite having been hired with lifetime job guarantees.