Romania Can Pay Pensions, Wages Without IMF Loan – Liberal

Nicolaescu told a news conference in the northeastern city of Suceava that worries that the country can’t pay its public sector employees and people’s pensions without using IMF money are groundless and Romania could have coped with these expenses even if the country hadn’t signed a loan agreement with the Internationals Monetary Fund.

„We don’t need IMF money to pay minimal obligations such as wages and pensions,” said the former liberal minister, whose government steered clear of a bailout loan request in 2008.

Nicolaescu said taxpayer money collected to the state budget is enough to pay wages and pensions, but just not enough to make investments in infrastructure.

„We spend about 12-13% of collected taxpayer money to cover wages and pensions,” said Nicolaescu, adding people are being manipulated when they are told the country needs the bailout loan to pay their wages.

„What this government is doing is cynical,” the liberal leader said, adding liberals voted to oust this Cabinet and will continue to vote against any government that doesn’t take the measures the country needs.

Romania currently has a government with limited powers, which was ousted mid-October in a no-confidence vote in Parliament. The Parliament has since rejected a proposed government of economist Lucian Croitoru and liberals have vowed to vote against the future proposed cabinet of newly-designated Prime Minister Liviu Negoita.

Romania, which is struggling with a deep recession beside its ongoing political crisis, has a two-year standby agreement for an IMF-led EUR20 billion bailout loan, that also includes funds from the European Commission and the World Bank.

Romania received so far about EUR7 billion in IMF money and another EUR1.5 billion from the European Commission, but both institutions now put off further loan disbursements because of the country’s political uncertainty.