Michalis Katrinis, an MP for PASOK–Movement for Change, described the swelling of private debt as “the epitome of government failure” during a debate on the relevant bill in the competent parliamentary committee. He said New Democracy had rejected sustainable repayment arrangements, left funds unchecked without protecting primary residences and relied solely on the out-of-court mechanism, leaving households and businesses to accumulate debt.
The MP for Ilia noted that private debt is approaching €240 billion. Arrears owed to the state rose by €10 billion in a year, while, citing the latest report from the Bank of Greece, he said non-performing loans stood at €79.2 billion.
He also said that just 4.9% of tax debts are covered by a repayment arrangement, while many of the 70,000 arrangements made through the out-of-court mechanism become non-performing again within 3–6 months. Only 23,000 tax debtors signed up to the 72-instalment scheme, against a government forecast of 1.5 million. More than 300,000 professionals, farmers and self-employed people remain unable to receive a pension because of their debts.
PASOK’s proposals
He stressed that the government had now adopted the 120-instalment plan that it had mocked when his party proposed it, following the “Waterloo” of the 72-instalment scheme. But the new plan carries an interest rate of 5.84% and excludes tax debts and liabilities for 2025 and 2026. He also criticised the absence of any requirement to reconcile and verify debts, with servicers only required to notify debtors, and of any obligation to provide information about enforcement actions and Land Registry entries. He called for seizures to be proportionate to borrowers’ actual ability to repay.
In this context, he set out PASOK’s proposals to protect primary residences under Law 3869/2010, with updated criteria, and to protect farmland as a person’s sole means of livelihood. He also referred to allowing borrowers to buy their loans before they are sold or resold to funds, finding a fair solution for guarantors, and sharing foreign-exchange risk on Swiss franc loans, with two-thirds borne by the bank and one-third by the borrower.
He also reiterated the proposal for 120 instalments for debts to the tax authorities and EFKA, at a low interest rate and with a 30% “haircut” provided the repayment arrangement is maintained. He called for existing active arrangements to be transferred, lapsed arrangements to be reinstated upon payment of one instalment, and debt settlement committees to be set up independently of banks and servicers. The committees would review refusals to restructure debts, propose solutions and require reasons to be given for rejections.
On fire-damaged loans backed by a state guarantee, he said the government was merely lifting time-based exclusions, without lowering interest rates or providing further write-offs of interest and surcharges, leaving the problem facing guarantors unresolved. He called for debts to be apportioned fairly to protect co-debtors and guarantors. “State support must not end in the financial ruin of those affected by fires,” Michalis Katrinis said.