Proposal For Examining Committee To Probe ELSTAT Scandal Approved

Greek lawmakers approved Thursday a proposal to set up an examining committee to assess whether the country΄s statistics service used methods that exaggerated the country΄s debt woes to justify the bloc΄s demands for austerity measures, according to Dow Jones Newswires.

The proposal was approved by majority and a 19-member committee will have completed its investigation by March 23, Philippos Petsalnikos, speaker of parliament, said.

The case is a bizarre twist in Greece΄s two-and-a-half-yearlong effort to firm up its economic data. In that time, the country repeatedly has revised upward its deficit and debt numbers, deepening a crisis touched off by gross underestimates in 2009. But this is the first time the country has been accused of inflating its woes.

After its election victory in October 2009, the incoming Socialist government revised that year΄s budget deficit to around 12% of gross domestic product–double what the previous government had claimed. A series of revisions over the following months raised it to 15.4%, spooking international markets and forcing Greece to seek a EUR110 billion ($145.7 billion) bailout in May 2010 from the European Union and the International Monetary Fund.

Under the terms of that aid, Greece overhauled its statistics service and made it an independent agency free from Greek government control.

Read more about the ELSTAT case and hear the testimony by clicking here

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