Greek Prime Minister Alexis Tsipras (L) meets with Jyrki Katainen
Athens - AFP
Greece's parliament adopted a controversial decree ordering all public institutions to hand over their cash reserves to the central bank to help Athens meet its financial obligations.
The decree was adopted by the ruling Syriza party and its junior partner ANEL by 156 votes in favour and 104 against in a noisy debate.
The decree says the reserves will be used to cover "the state's urgent needs, which amount to three billion euros over the next 15 days".
As talks bog down between Athens and its international creditors to unlock 7.2 billion euros ($7.7 billion) in bailout funds, the cash-strapped leftwing government last week moved to call in reserves, triggering a wave of anger.
The measure will require some 1,400 public institutions -- including hospitals and universities -- to hand over their reserves to help pay civil servants' wages and debt servicing costs.
It underlines the urgency of the cash crunch faced by Athens and heightened fears that Greece was lurching closer to defaulting on its debt and a potentially chaotic exit from the eurozone.
The government estimates the move will raise some 1.5 billion euros, but local media have put the figure at around 400 million euros.
Local authorities have complained bitter about the government decree, warning that the raid on their reserves could bring public services to a halt.
"It is unjust and unacceptable for the state to manage municipalities' funds," Giorgos Patoulis, who heads the Central Union of Municipalities, said last week during a meeting attended by deputy finance minister Dimitris Mardas.
But Mardas defended the government's move as "no more than a short-term loan by the state", adding that the funds would be reimbursed "according to the needs, within a period of 15 to 20 days".
Meanwhile in Riga on Friday, the eurozone's 19 finance ministers ended a meeting without a breakthrough towards unlocking bailout cash, with the threat of a messy exit by Greece from the euro still hanging in the balance.
Increasingly irate ministers are refusing to release any cash without a comprehensive list of reforms that the hard-left Syriza government has so far refused to accept.