Greece's highest court to rule on legality of referendum

Greece’s highest administrative court will rule on whether the country’s bailout referendum violates the constitution, amid growing concern that the hastily organised vote falls short of democratic standards.

With less than 48 hours until polling day on Sunday, the yes and no sides will stage large rallies in Athens on Friday evening. The prime minister, Alexis Tsipras, is expected to turn out at the no rally, having attacked his eurozone partners for trying to “blackmail” his country into accepting a bad deal.

Greeks are being asked whether to support an EU bailout deal that would grant the debt-stricken country money in exchange for spending cuts and further reform.

However, the bailout plan no longer exists, having lapsed on 30 June. Eurozone leaders have lined up to say that voting no means saying goodbye to Greece’s eurozone membership, but Greece’s radical left Syriza-led government insists a no vote would simply boost its negotiating hand.

Later on Friday, the council of state will determine whether the vote violates Greece’s constitution, which bans referendums on fiscal policy.

Europe’s top human rights body, the Council of Europe, has already said the vote falls short of international standards, because the poll was called at short notice and the questions asked are not clear. The Strasbourg-based organisation, which is not part of the European Union, recommends that voters should be sent “balanced campaign material” at least two weeks before a vote.

Instead Greeks will have had just eight days to decide on a question couched in jargon-heavy terms.

Europe’s top official in charge of the euro said the question being put to the Greek people was “neither factually nor legally correct”. Valdis Dombrovskis, a former prime minister of Latvia, but now the commissioner for the euro, told Die Welt newspaper that Sunday’s vote would send a political signal to Europe.

“A yes will mean that they want to work closely with the other eurozone countries to find a solution. A no would make the differences even more evident and a solution more complicated.”

The latest polls show that Greece is split down the middle, raising the prospect of a narrow win for either side pushing the country into deeper political turmoil. In one poll for Ethnos newspaper, the yes side have a narrow lead, with 44.8% of people ready to vote for the creditors’ proposals and 43.4% wanting to vote no, with 11.8% undecided.

Another poll commissioned by Bloomberg put no at 43%, compared with 42.5% for yes. That poll, conducted by the University of Macedonia, has a margin of error of 3%, suggesting that the result is too close to call.

European leaders have said that if Greece votes no, it will say goodbye to its place in the single currency. However, the country’s finance minister, Yanis Varoufakis, has said a no vote will kickstart negotiations.

Adding to the uncertainty, the International Monetary Fund, one of Greece’s three creditors, revealed on Thursday that Greece would need need €60bn (£42bn) of extra funds over the next three years and large-scale debt relief to create “a breathing space” for the economy.

Varoufakis, who has promised to resign if Greeks vote yes, said the government had been in discussions with its European creditors this week and that a deal was “in the offing”.

Speaking on RTÉ radio in Ireland, he said Syriza would be the only force capable of governing the country, even if the yes side won. If Greeks did approve the bailout plan, the government would sign on the dotted line, he promised.

Dombrovskis said it would be wrong to assume that a no vote would strengthen Greece’s negotiating hand.

“The opposite is the case. Following the closure of banks and the introduction of capital controls to attain financial stability again, it has become more complicated and more expensive. Greece is in a substantially worse situation than it was last week.”

As the two sides spar, Greece is fast running out of money, although it appears to have enough to cover €2bn worth of welfare and pension payments this week. Cash withdrawals have been limited to €60 (£43) a day.

In a TV interview broadcast on Thursday, Tsipras said the banks would open once there was a deal, predicting that that would happen within 48 hours of the referendum.

However, most observers think this unlikely unless the European Central Bank restarts the flow of emergency aid to Greek banks.

One senior banker told Reuters: “We might run out of banknotes by Tuesday if people keep taking out €60 a day.”