Dear readers, good morning!
A total of €7bn was earmarked from disbursements under the third bailout programme to clear the Greek state’s overdue liabilities.
This was no mere government promise. Repayment of debts to private creditors was a condition for the creditors to disburse tranches. In 2016, 2017 and 2018, progress in clearing the liabilities was linked to specific disbursements by the European Stability Mechanism.
Years passed. The bailout programmes ended. The economy regained investment-grade status, and the government is right to highlight the progress made in public finances.
But we were left with unpaid bills.
According to the latest figures published by Euro2day.gr, the public sector’s overdue liabilities and outstanding tax refunds reached €3.88bn in September, up by €57m in a month.
Of that total, €1.367bn relates to debts owed by public hospitals, while €979m is in outstanding tax refunds. These are not homogeneous liabilities, nor are they all overdue. But they represent a significant backlog that continues to weigh on the state’s dealings with the economy.
And the problem is not just about the numbers. According to the European Payment Observatory’s 2025 annual report, Greek public authorities took an average of 73 days to pay their suppliers in 2024—the second-worst performance in the European Union.
Worse still, one in three Greek businesses reported problems caused by payment delays by public bodies. That was the highest such share in the EU.
What does this mean in practice? A business waiting to be paid by the state still has to meet its payroll, pay social security contributions and taxes, and settle its bills with suppliers. If it does not have enough cash, it must seek a loan. If it cannot borrow, it cuts back its operations.
The state delays payment, and the economy is left to finance that delay.
It is no coincidence that in the same European survey, 41% of Greek businesses said payment delays had adversely affected their investment or hiring plans. That figure covers payment delays overall, not just those by the state.
There is more. The European Commission has launched two infringement proceedings against Greece over payment practices at public hospitals. One concerns excessive delays. The other concerns practices under which suppliers were asked to waive their rights to interest and compensation in order to be paid immediately.
In other words, it was not enough that the state was late paying. In some cases, prompt payment was also tied to the creditor waiving legal claims.
Now let us reverse the roles. What happens when a citizen or a business is late paying what it owes the state? Interest, surcharges and, in certain circumstances, compulsory collection measures. And rightly so: the state expects people to meet their obligations. But compliance cannot be a one-way street.
Of course, late-payment interest is also provided for when the state is late paying in commercial transactions. But the point is to settle liabilities on time—not to force suppliers to claim what they are owed.
The government has announced new mechanisms to monitor arrears, including the “Consistency” platform. It is welcome. But let us not kid ourselves.
A problem that was not solved by bailout programmes, prior actions and billions in special disbursements will not be fixed simply by another online platform.
The causes of the continual build-up of new backlogs must be identified and addressed. There must be accountability for delays. And paying the state’s liabilities must stop being treated as an achievement rather than an obvious obligation.
Investment-grade status certifies the country’s creditworthiness. It does not certify that the state meets its obligations to those who provide it with goods and services.
We went through three bailout programmes to learn, among other things, that the state must pay what it owes. How many more years will it take us to put that into practice?