The Minister of National Defence Mr. Nikolaos Panagiotopoulos delivered an answer, on Wednesday 6 October 2021, to a topical question submitted by the MP of the Communist Party in the constituency of Achaia Mr. Nikolaos Karathanasopoulos on the subject: “Discharge of 36 employees of the Hellenic Arms Industry in Aigio”.

During his first address, the Minister of National Defence stressed the following:

“Dear colleague,

I will try to make some things clear because I can answer by saying that it is absolutely absurd for the Ministry of National Defence to have say on the manner of management and administration of the Hellenic Defence Systems, while, typically, it is the company’s supervising body and practically its primary – if not its only – client. It is, indeed, a paradox of the manner of operation of the modern economy that a client can be held accountable for the manner in which the provider of the materiel operates! The owner of the company is the shareholder of the company, the Ministry of Finance and the manager of the company is its Board that makes the decisions which have to do with the company’s management based on their managerial rights.

One, reasonably, asks this question: “Whether a provider of defence materiel can survive in the modern market and with the developing competitiveness with only one client.” I would say that it is difficult anyway for this to happen, if the same client, continuously, submits orders and also buys the raw material. I do not know any restaurant which I can visit as client to order lunch and its owner can tell me: “Go and buy the ingredients, so you can eat”. This does not happen. It is, as you understand, an absurdity or an issue that the company should solve.

On 1 October, the Ministry of Finance (that is the shareholder and owner) announced an increase of the share Capital of the Hellenic Defence Systems by 29 million euros, to cover its needs, fifteen million for the payment of third parties, four million for the payment of salaries and ten millions for the procurement of raw material. At the same time, the Ministry of National Defence, in coordination with the Ministry of Finance is trying to do its best in order to submit some orders with which we can support the employment posts in the Hellenic Defence Systems since we are the only client.

So, the HAGS has scheduled the procedures provided by the legislation – which require time – in order to activate the following programmes with the Hellenic Defence Systems:

• Procurement of a thousand light guns FN MINIMI at a total estimated cost of approximately 10,9 million euros.

• Conversion of five hundred quick-change barrels machine guns at a total estimated cost of 2,132 million euros.

• Upgrade of 122 mm rockets at a total estimated cost of 87 million euros.

• Procurement of cartridges at a total estimated programme cost of 14 to 14,5 million euros. You know that the cartridges are not manufactured in Aigio, but in an other factory of the Hellenic Defence Systems.

The HAGS aims to make orders for the implementation of the aforementioned programmes of a total estimated cost of 115 million euros. The time schedules are mostly influenced by the procedures required for the award of the relevant contracts to Hellenic Defence Systems.

One more thing I think is important in our discussion: In this case, the conclusion of a contract between the Hellenic Defence Systems and the contractor regards the execution of a particular project. You are saying that it does not regard a project, but employees. These employees do not have any work relation with the Hellenic Defence Systems. They are the contractor’s personnel, they are hired under contract by the contractor and they are discharged at the end of the project. This is the reason why the possibility to renew the contract is related to the work relation between them and does not concern the Hellenic Defence Systems by any means, and the Ministry of National Defence.

As far as the question of changing the contracts of the employees into indefinite and constant, you know that it is not provided by the legislation. Temporary or permanent personnel is hired by the Hellenic Defence Systems via the hiring system of the Civil Service, and probably, since this system has slow procedures, in relation to the needs to be covered, this is why the solution of hiring personnel by contractor is preferred.

Everything else can be discussed over the second address, but these two things are enough I think. The HAGS does its best for the Hellenic Defence Systems to receive orders. But, apart from that, the Hellenic Defence Systems should solve their issues regarding the internal management of their personnel, as a company which is run by its administration, under the supervision of the Ministry of National Defence, yet also as a property of the Ministry of Finance, due to the composition of its shareholders”.

In his second address, Mr. Panagiotopoulos underscored:

“Dear Colleague,

The law that regulates hiring state employees can cause delays in the procedure, but it does not forbid hiring. For example, this applies to Hellenic Defence Industry – where there is much work and need – personnel hiring procedures are planned, in order for the company to respond to the requirements of the implementation of its work.

So, the point is, above all, that there must be a constant work flow that has to be implemented. In this context, in the Ministry of National Defence, we do our best and we always consider every possibility, in cooperation with the Ministry of Finance, to submit some orders and thus help the Hellenic Defence Systems to have job and to maintain their employment posts.

As far as the employment terms of rented workforce is concerned, this is regulated by internal decisions of the Administration of the Hellenic Defence Systems. I think that if there was a “surplus of work”, the problem they would mainly face, at this time, is to hire all the more employees. There is no such issue at present. But we have said, as Ministry of National Defence that an industry like the Hellenic Defence Systems, a pillar for the procurement of defence materiel in this country should be kept operational at any cost, and, of course, any privatization plans have been out of discussion.

Since you mentioned it, the “National Rifle” is a really great project which would be able – as I have publicly stated – to signal that the Hellenic Defence Systems started to follow a course of progress and rapid productivity. But it is also a project which we have announced, but we have not yet scheduled it for the near future. This is part of the whole programming of the upgrade of Armament Systems of the Armed Forces. But we have said that whenever it is needed, this will be fulfilled on terms of joint production and the new “National Rifle” will be produced in the factory of the Hellenic Defence Systems in Aigio where weapons are produced. Ammunition and caliber rounds are produced in other factories of the Hellenic Defence Systems.

So, the project of the “National Rifle” can be our future, yet it will not produce results immediately. It will not begin, as far as I may know, very soon. It is a mid-term programme, but it may be a solution.

In the meantime, our goal is to maintain the Hellenic Defence Systems at an operational condition and, thus, maintain also the need for personnel, who will work for the implementation of orders made by the Ministry of National Defence, in cooperation with the Ministry of Finance which consented to the financial “injection” to the Hellenic Defence Systems by raising the share capital, 29 million euros I referred to, given that there will be orders.

We want the Hellenic Defence Systems to be operational. This is a decision by this government and, therefore, we have to find a solution by providing the Hellenic Defence Systems a flow of orders that will keep their operation and the personnel employed in these programmes. There are the inevitable procedures by the Ministry of National Defence, for the programmes of the Hellenic Army General Staff to be proceeded and implements. From that on, if there are some idle periods of time, they are matters that should be regulated by the Administration of the company and the manner it employs its personnel, according to the administration rights. The company has its own administration. It is not ruled by the Minister of Defence, nor by the Ministry of Finances.

As an important element of the domestic Defence Industry, we think that the Hellenic Defence Systems should be kept operational or that the “National Rifle” is foreseen to have a promising future, but this will not happen in a day or in a week or two-three months. The “National Rifle” will be included in the whole planning. You know the priorities we have given over the last period to the big Armament programmes we are implementing; the “National Rifle” is among them.

We will do what we have to, in order to support the operation of the Hellenic Defence Industry, through a productive procedure, in which employees will be implementing orders and will work. And this is where the Ministry of Finance counts on in order to find – as I said already – the money for the purchase of the raw material and thus for the orders to be executed. The Ministry of National Defence also support the procedure in the manner I explained you.

Thank you.”