Greece: It’s the corruption, stupid!

Tuesday, August 23, 2011
By Paul Martin

Beneath the desperate debt crisis headlines, Jeff Randall finds a country mired in fraud and fiddling – and discovers its authorities are powerless to stop the rot.

By Jeff Randall

Tavros is a scruffy suburb in the south-western part of Athens, about three miles from the city centre. It is home to the kind of utilitarian office blocks that 1960s town planners thought were a good idea. Many of the buildings are scarred by graffiti and the side streets are strewn with litter.
On a stiflingly hot day, I come here to interview Petros Themelis, a finance ministry official, who runs a call centre that’s part of the Greek government’s battle against tax evaders. The idea is that public-spirited citizens ring up and snitch on those they suspect of tax dodging. This is the human factor in a much bigger war: Greece’s life‑or-death struggle with the Debt Beast.

The state’s accumulated borrowings are equal to about 160 per cent of national output. Greece cannot afford to service the interest, much less repay the capital. The country is, in effect, insolvent. Without the largesse of outsiders – many billions in bail-outs from the International Monetary Fund and the European Union – it would already have collapsed into bankruptcy.

In a last-ditch effort to stave off such an outcome, the Greek government is trying something new – well, new for Greece. It’s treating tax collection as a process that requires more rigour than passing round a church plate. There is much to shoot for: about €30 billion (£26.2 billion), or 12 per cent of GDP, are lost to tax cheats every year.

Mr Themelis’s team consists of three middle-aged men in casual shirts and chinos, manning phones and scribbling callers’ details into log books. The operation resembles a provincial bookmaker’s credit betting office – before computers.

The Rest…HERE

The Rest…HERE

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