September 26, 2014
Elina Zagou, Judicial, County Court Katerini, Greece
Fotis Zygoulis, Head of the Independent Planning and Design Department of the Municipality of Heraklion Attica, doctoral candidate at the University of Athens +302132000118, Greece
Email: firstname.lastname@example.org, email@example.com
Greece in the year 2014 is now in the seventh year of recessionary economic cycle, which causes adverse effects on the social, economic and political spectrum. The crisis served as a catalyst for structural reforms, especially for countries like Greece, which signed agreements on international and European aid that posed as a prerequisite a number of radical changes concerning the organisation and functioning of public administration.
The current financial crisis exposed the weaknesses of the Greek political system regarding patron-client system. The dominance of the patronage system characterized during the previous years both the recruitment of public servants and the public administration’s attitude towards society and economy.
Greece’s economy in the last 40 years was based on excessive consumption, external and internal public borrowing. While European funding had been channeled primarily to consumption, without taking into account the needed investments, the country’s economic development and infrastructure, the improvement of good governance, the state was overloaded with an army of public servants. An unequal distribution of public administration’s structures emerged which resulted in a wastage of public expenditure, loans increasement, a huge debt and a gradually reduced efficiency of the public sector.
The peculiarity of the Greek public sector is the large size and exorbitant public expenditure on wages, but also the low efficiency along with extremely low quality services to citizens. However, the efforts of Greece since the end of 1990 to introduce the Economic Monetary Union reflected in quantitative restrictions on employment policy in public administration. Recruitment had been diminished, and in many cases the replacement of the outgoing staff was limited to one to three or one to five (although these measures were not applied across the whole public sector, applied unevenly and in some cases gradually abandoned).
Since 2009, due to the Fiscal Memorandum with Troika, there was applied a strict replacement staff rule in the public, (one to five). The Medium Term Financial Strategy Government Program extended this rule for the years 2012-2015 and “strengthened” in one to ten in 2011.
In the recent years an attempt was made to adapt to the Troika. So there has been a beginning of a series of serious reforms leaded by the Ministry of Administrative Reform, in order to evaluate both the structure and staff of the Public Service in order to remove structures that have nothing to offer to society or coexisting with other sharing the same powers and lastly to evaluate the public administration’s personnel . Also in the framework of the Memorandum with Troika, traditional public structures have been abolished under the ‘mobility’ project in order to fill positions of government, which were in an emergency state.
The economic and administrative restructuring project in Greece involves the following steps:
Reduction of the operating costs of central government by 200 million
Reduction of public investment program by 400 million euros.
Introduction of the rule 1:10 concerning the recruitment in public interest’s enterprises
Reduction of staff salaries in the public sector by 22 per cent
Reduction of 150,000 civil servants
But the crisis has worsened the economic situation of civil servants with the upcoming reduction of the average wage and the number of salaried personnel by the state budget. The simultaneous reduction of the amount of earnings made unattractive the public sector to the existing personnel. The moreover wider obsolescence of human resources, inevitably led to a drop in morale and a reduction of the employee productivity, while it is often associated with increased incidences of corruption.
The unemployment rate in Greece and in the EU (2000–2012)
European Union (27 countries) Greece
Source: [Eurostat, „Unemployment statistics‟,
The proposals which have been implemented during the last six years concern: Management by objectives – Suspension and recruitment limitation – Meritocracy in the selection and promotion – Motivation Productivity – Enhancing mobility – Simplified pay system – single payroll – Redesign education systems for public officials.
Greek financial crisis is a window of opportunity to promote reforms. The decrease of the average wage and the number of salaried by the state budget is the main priority in the period of last three years. Cutting salaries (average more than 35percent), while the number of salaried by the state budget has been reduced by 9.9% (76,408 persons) in relation to 2010 has leaded to a massive exodus of Greek public servants to retirement.
The reduction of the number of civil servants in Greece was not accompanied by radical changes related to the modernization of HR management. The lack of goal setting, performance measurement indicators and the continued patronage of the State with regard to the appointment of heads of organisational units in Greek government has canceled the practice of this kind of numerical and quantitative limitations operations and has not contributed to an improvement of the quality of services offered by Greek civil servants.
The effects of reduction of the salaries of civil servants in the Greek economy Greek economy has been described in the OECD report entitled: Fairly Sharing the Social Impact of the Crisis in Greece 2014 which clearly shows that the salaries of civil servants by 2010 were incomparably higher than those of their colleagues in the private sector contributing thereby to great inequality among workers. However the salaries of civil servants channeled mostly to private consumption. For this reason, the reduction of the salaries of civil servants affected both the corresponding reduction in private sector wages and general economic cycle.
The ongoing crisis has dramatically affected all structural deficits that characterize the Greek public administration. The decision-making system, structures for implementation and monitoring of public policies which, because of their systemic nature, may be considered as “standing weaknesses” of the entire framework for the organization and the functioning of public administration. Problems such as poor utilization and misallocation of human resources, the absence of modern methods, techniques and tools administration and lack of the public sector coordination led to the current disease situation of the state.
The problem of the Greek Public Sector neither is determined nor is based only on the size which can be solved only through a reduction in staff or salaries of public employees. The hot task today is to upgrade the quality of services provided to citizens and businesses through a rationalization of structures. The administrative burden of the operation of the Greek public bureaucracy is seriously affecting the economic growth more than the reduction of salaries of Greek civil servants.
Fournier, J.-M. and I. Koske (2012), “Less Income Inequality and More Growth – Are they Compatible? Part 7. The Drivers of Labour Earnings Inequality – An Analysis Based on Conditional and Unconditional Quantile Regressions”, OECD Economics Department Working Papers, No. 930, Figure 11.
OECD (2012), Economic Policy Reforms 2012 – Going for growth, Greece-country note, February 2012.
OECD (2011), Greece: Review of the Central Administration, OECD Public Governance Reviews, OECD Publishing,
OECD, (2012a) Public Sector Compensation in times of austerity, OECD Publishing, Paris
OECD (2012c), Greece: Review of the Central Administration (Greek version): OECD Public Governance Reviews, OECD Publishing, http://dx.doi.org/10.1787/9789264179158-el
OECD, 2012d, Developing Human Resource Management Strategies to Support Strategic Agility in the Public Sector
Ministry of Administrative Reform and E-Governance: National Strategy for Public Administration Reform 2014-2016
Unofficial Translation of the OECD report on the Greek Central Administration (2011) from the National Alumni Association of Schools of Public Administration and Local Government
Effects of restrictive policies on public services Athens 2013 Social Multicenter ADEDI
“Local Government: Economic Status of Municipalities, The Impact on human resources of the Municipalities’ Social Multicenter ADEDI 2014
“A new strategy for the management of human resources in public administration” P. KATSIMARDOU Buas INERP 2012
“Crisis and Reforms in public administration” Anthi Karagiannis, 2012 European Centre of Excellence, Jean Monnet Program
Karkatsoulis P. (2012) Administrative reform is necessary and feasible!, Paper presented at a panel discussion organized by ELIAMEP, Kantor and the Citizens’ Movement and Transparency International, Athens, April 3rd, 2012