They argue that cutting private-sector holiday allowances is among reforms necessary to boost competitiveness in the country. Those opposed say the cuts would deepen the country's recession, now in its fifth year.
'Razor's Edge'
Greece's efforts to win a second bailout from the troika have hung in the balance over the past three days as negotiations in Athens failed to clinch an agreement. Venizelos said on Feb. 4 the talks were on a "razor's edge."
Facing a 14.5 billion-euro bond payment on March 20 and general elections as soon as April, Papademos must heed international demands for greater austerity to complete the talks on a second aid package in time. Open questions involve how much more aid Greece needs, how much more austerity is required, and how to involve the European Central Bank in the private-sector creditor debt swap.
Guarantees from Greek political leaders such as Samaras, who leads in opinion polls, are key to securing the funds from the EU and IMF. International lenders want assurances that whoever wins the next election will stick to pledges made now to receive financing.
George Papandreou, the former prime minister who still leads the Pasok socialist party, the biggest in the Greek parliament, held talks with members after the meeting to discuss its response.
Extending Mandate
In a letter sent separately to Papademos, he proposed that Papademos's mandate be extended to boost confidence among lenders the pledges will be implemented. That is an option likely to be opposed by Samaras, who has called for elections as soon as the new financing is agreed.
The rescue blueprint includes a loss of more than 70 percent for bondholders in a voluntary debt exchange and loans that will probably exceed the 130 billion euros now on the table. A formal offer for the debt swap must be made by Feb. 13 to allow all procedures to be completed before the March 20 bond comes due.
"One thing is clear: the Greek drama continues to unfold," Joachim Fels, chief economist at Morgan Stanley, wrote in a note yesterday. "A really, really bad scenario for the euro area -- a Greek default and departure from the euro area -- simply cannot be excluded."