Greek lawmakers have approved the 2013 budget involving fresh spending cuts, despite mass public street protests.
The budget was passed by 167 votes to 128. The move was a pre-condition for Athens to be granted a 31.5bn euro (£25bn; $40bn) EU/IMF loan necessary to stave off bankruptcy.
In Athens, more than 10,000 people protested outside the parliament.
The vote comes as eurozone finance ministers are due to discuss the Greece crisis at a meeting in Brussels.
Greek Prime Minister Antonis Samaras, who is due to attend the summit, earlier warned that without the new loan, Athens would start running out of money within days.
The problem that he faces is that it could take some weeks before the EU backs the new instalment, BBC Athens correspondent Mark Lowen reports. The measure will have to be approved first by some parliaments, including Germany’s.
“We are not responsible for the urgency – all those concerned have known the deadlines for a long time ”
Wolfgang SchaeubleGerman Finance Minister
The new Greek budget foresees a deepening of the worst recession of any country in modern history, our correspondent says.
The national economy is expected to shrink next year by 4.5% and public debt is likely to rise to 189% of GDP, almost double Greece’s national output. This year, public debt stood at 175%.
The head of Syriza, a left-wing opposition party, said the latest budget cuts would leave Greeks unable to afford essential goods this winter.
“This is why we say you are dangerous for this country,” Alexis Tspiras said, telling the government: “You are incapable of negotiating.”
As MPs inside parliament debated the budget late on Sunday, marchers outside brought the centre of the capital to a standstill.
Members of the Communist-affiliated Pame union, the private sector GSEE union and the public sector Adedy union had urged parliament to reject the budget.
But there was none of the violence seen last Wednesday when protesters attacked riot police with petrol bomb and the police responded by firing tear gas.
Measures in austerity package
- Retirement age up from 65 to 67
- A further round of pension cuts, of 5-15%
- Salary cuts, notably for police officers, soldiers, firefighters, professors, judges, justice officials; minimum wage also reduced
- Holiday benefits cut
- 35% cut to severance pay
- Redundancy notice reduced from six to four months
Evangelos Venizelos, whose socialist Pasok party is part of the governing coalition, warned European partners that any delay in pushing through the loan worked against Greece and the eurozone as a whole.
“The country is at its limits,” he said.
German Finance Minister Wolfgang Schaeuble said nobody opposed the next slice of loan funding, but the Greek government should have met the conditions for it months ago.
Former Greek MP, Elena Panaritis: “This just hurts the same people over and over again”
“We are not responsible for the urgency. All those concerned have known the deadlines for a long time,” Mr Schaeuble said in an interview with Die Welt newspaper.
The next tranche of bailout loans for Greece has been delayed for months, becoming as much a political symbol as a financial one, the BBC’s Chris Morris in Brussels reports.
Eurozone governments have not decided how they will pay for it, our correspondent says. So there are still plenty of questions surrounding Greece and the whole strategy of austerity-based reform.
A final report is still awaited from the main lenders – the European Comission, the IMF and the European Central Bank – on the progress of reforms Athens has signed up as part of the bailout deal.