* ESM criticises payout proposal
* Greece plans parliamentary vote on pensions on Thursday
* Greek pensioners to protest against "ruse" measures
(Adds planned parliamentary vote, other details)
By Jan Strupczewski
BRUSSELS, Dec 14 Euro zone lenders put a
short-term debt relief deal for Greece on hold on Wednesday
after the Athens government proposed a one-off payout to
pensioners, the euro zone bailout fund ESM said.
Euro zone finance ministers agreed on Dec. 5 to grant Greece
short-term debt relief that would reduce its public debt by 20
percentage points of GDP by 2060.
But three days later, Greek Prime Minister Alexis Tsipras
said his government would spend 617 million euros in one-off
benefits for low-income pensioners ahead of Christmas because
Greece had exceeded its 2016 primary surplus target.
The Greek government has also annoyed its lenders by
deciding to continue a 30 percent discount on levels of
value-added tax charged on some Greek islands.
"Following recent proposals by the Greek government to spend
additional fiscal resources for pensions and VAT our governing
bodies have put their decisions temporarily on hold," a
spokesman for the ESM said.
"Institutions are currently assessing the impact of Greek
government decisions vis-a-vis the ESM programme commitments and
targets. (We) will then analyse the institutions' assessment and
subsequently decide how to proceed," the ESM spokesman said.
Greek government borrowing costs rose to one-month highs on
In a defiant response to the lenders' move, Athens said it
would hold a parliamentary vote on the pension payments on
Thursday in an effort to rally domestic support.
Greek pensioners, who have seen repeated cuts in their
pensions during seven years of recession as part of a
bailout-mandated austerity drive, have already snubbed the bonus
plan as a "ruse" and plan rallies in Athens on Thursday.
The ESM had already criticised the payout proposal on
Monday, but Tsipras was defiant in a speech the following day.
"When we exceed targets and revenue by sticking to the
programme, we will not seek anyone's permission to give this
money to those who need it most," he said.
The International Monetary Fund, which a group of countries
led by Germany hope will join the bailout programme to provide
greater credibility, says euro zone targets set for Greece are
too ambitious and assumptions on reform implementation too
The IMF insists that euro zone governments, which now own
most of Greece's debt, should grant it substantial debt relief
by extending maturities.
Germany and other euro zone countries say a discussion on
such a move can take place in 2018, once Greece completes its
bailout reforms. This would also move the politically sensitive
debt issue past German elections in the second half of 2017.
Tsipras is due to meet German Chancellor Angela Merkel in
Berlin this week.
(Additional reporting by John Geddie in London, Karolina
Tagaris and Michele Kambas in Athens and Gernot Heller in
Berlin; Editing by Gareth Jones)