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Greece says ready to resume talks, bridge gap with creditors

A European Union flag (L) and a Greek national flag flutter as the ancient Parthenon temple is seen in the background in Athens June 1, 2015. REUTERS/Alkis Konstantinidis

ATHENS (Reuters) - Greece remains open to finding a deal with lenders and is prepared to bridge a budget gap as demanded by lenders but not by cutting pensions or raising taxes, the deputy prime minister said on Sunday after a breakdown in negotiations.

In a statement, Deputy Prime Minister Yannis Dragasakis said the Greek delegation remains ready to resume talks but blamed European lenders for insisting on pension cuts and value-added-tax hikes to close the projected budget gap.The comments came after the European Commission said on Sunday the talks between Greece and its euro zone and IMF creditors did not succeed, leaving the final decision on whether the country is going to default to euro zone finance ministers.

A Greek government official blamed the lenders for the impasse, saying the lenders' representatives at the talks said they were not authorized to negotiate further on the matter.

"Although during the leaders' meeting Greece was told to negotiate with the institutions, the institutions today said that they were not authorized to negotiate further," a Greek government official told Reuters.

The two sides had come to an agreement on a target for the 2015 budget gap, the official said. But the lenders estimated a fiscal gap of 2.6 percent of gross domestic product (GDP) for 2016 which the Greek side opposed since it estimated a gap of 2 percent of GDP, the official said.

Greece needs to secure a deal with its creditors within days if it is to avoid defaulting on a 1.6 billion euro ($1.80 billion) payment to the IMF at the end of the month.

(Reporting by Renee Maltezou; writing by Deepa Babington; editing by Susan Thomas)