Romanian President Announces Pensions To Decrease By 15%, Public Sector Wage Fund By 25%

Basescu said pensions will fall by 15%, and the money allotted to public sector salaries will be reduced by 25%, which will also affect the minimum wage.

Basescu said minimum wages will not decrease below RON600 lei (EUR1=RON4.1833).

The head of state also said the Government will transfer EUR1.7 billion to the pension fund, adding that extra EUR500 million are needed to pay pensions at their current level. Basescu said the EUR500 million fund for pensions is not available and pensions must be reduced by 15% to keep the system sustainable.

The head of state also said subsidies will be drastically reduced and mentioned subsidies for heating. He also said unemployment aid will decrease by 15%.

The president said the money obtained after subsidy cuts will be allotted to those who really need financial help. He also pointed out Romania’s 16 social aid programs will be reanalyzed so that they do not become income sources to render work unnecessary.

The head of state said the difference between state budget revenues and expenditure needs to be covered by lowered spending in the public and social sectors. Basescu said the Government needs to amend the Labor Code in order to render workforce more flexible, and analyze taxation.