Greek PM says budget surplus tops forecast, allows spending

ATHENS (Reuters) - Greece's primary budget surplus has exceeded expectations and will allow the government to boost social spending on austerity-hit citizens, Prime Minister Antonis Samaras told a newspaper. The primary budget surplus for 2013, which excludes interest payments and other one-off items, has come in at over 1.5 billion euros (1.2 billion pounds), much higher than initial estimates and targets set by the debt-laden country's international lenders, the European Union and the International Monetary Fund. "The primary budget surplus is much higher than we had initially estimated ... I am telling you now that it exceeds 1.5 billion euros, three times as big as we initially calculated," Samaras said in an interview published in Sunday's edition of To Vima, which hit newsstands on Saturday evening. A primary surplus is a key condition set by the lenders to grant the country the additional debt relief it needs to make it sustainable. Under the terms of its 240 billion euro bailout, Greece was supposed to reach a surplus this year. But Athens says it reached a surplus as early as 2013, one year ahead of schedule. Back in October, the government estimated the full-year 2013 surplus at 344 million euros. Samaras reiterated on Saturday he would use that surplus to alleviate the plight of those hurt by austerity. "This means that we will refund a very large amount to society this year, for example to low-income pensioners and law enforcement officials," he told the newspaper. The bailout's terms allow Athens to retain and spend as it wishes 70 percent of any excess primary surplus above its targets. Samaras's fragile coalition government is trailing the anti-bailout leftist Syriza party in the polls and faces crucial, twin municipal and European elections in May. A bad showing in the vote could destabilise his government, which has a paper-thin three-seat majority in parliament. But EU officials warned last week that any estimate about the size of the expected surplus is premature until April, when the EU's statistics agency Eurostat will officially sign off on the country's budget figures. "It is very astonishing to have an opinion on the surplus that early in the year," a senior EU official told reporters on condition of anonymity. (Reporting by Harry Papachristou and Martin Santa; Editing by Kevin Liffey and David Evans)