Greece to vote on social reforms on bailout talks deadline day

Ella Ide, John Hadoulis

Athens (AFP) - Greece is going ahead with reform measures in defiance of its bailout obligations, with Prime Minister Alexis Tsipras calling Tuesday for parliament to vote on a series of social reform bills at the end of the week.

The vote is scheduled to take place Friday, the same day as a controversial deadline imposed by Greece's eurozone partners at talks that collapsed in Brussels on Monday.

"We will not succumb to psychological blackmail," Tsipras said following a dramatic showdown in Brussels which saw his finance minister reject a deal which hinged on an extension to the country's unpopular fiscal programme.

"The Greek democracy does not threaten and is not threatened. It does not deal in ultimata. It negotiates as an equal in Europe," he said.

As a meeting of eurozone finance ministers broke up without an agreement Monday, Brussels told Athens it must agree to extend its reform programme by the end of the week or face a possible exit from the eurozone.

Tsipras said Wolfgang Schaeuble had "lost his cool" ahead of the meeting, after the German finance minister said he felt "sorry for the Greeks".

"With great respect and in friendship, I would like to tell him he should feel sorry for people walking with their heads bowed."

A follow-up bill to be presented later will tackle the "humanitarian crisis caused by the mistakes in the bailout recipe," he said.

- 'Life the noose' -

Tsipras' "social salvation" government has pledged to spend two billion euros over the next year to provide free food, electricity, accommodation and medical support to thousands of poor families.

"This is the debt we must repay first. We will not betray the Greek people's confidence," the PM said.

The European Union and the International Monetary Fund bailed out Greece in 2010, and again in 2012 to the tune of some 240 billion euros ($273 billion), plus a debt write-down worth more than 100 billion euros.

In return for the bailouts, the centre-right Greek government at the time agreed to a series of stinging austerity measures which Tsipras says are strangling the economy and which he has promised to ditch.

He insisted, however, that the radical left Syriza wants "to find a solution, not break with" Europe.

Tsipras accused Eurogroup head Jeroen Dijsselbloem of having taken off the table on Monday a draft agreement that Greece had been given by the EU's economic and financial affairs commissioner Pierre Moscovici.

The document, which Greece had been ready to sign, "alluded to the extension of the loan agreement and not the memorandum", the term used to describe the bailout obligations, he said.

The deal Dijsselbloem "replaced the first text with" was considered a huge step back by Athens, which refused to sign.

The social measures, which will be presented to deputies on Thursday, included "100 instalments to repay maturing debts to the state and social insurance funds," as well as measures for "workers, the unemployed and small and medium-sized businesses" which will "relaunch growth."

The measures will "lift the noose from the necks of millions of our fellow citizens, bring new income to state coffers and give the necessary development boost to the economy," Tsipras said.

Greek borrowing prices soared and the euro sank against the dollar hours after Athens turned Brussels down.

Finance Minister Yanis Varoufakis said however the different sides would find an agreement by Friday.