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Romania To Hike Pensions With Inflation Rate Not Depending On Avg Wage Under IMF Agreement – Sources

Romania will change the calculation of pensions and increase them depending on the annual inflation rate instead of the gross average wage, to balance its public pension fund on the medium and long term under the agreement with the International Monetary Fund, or IMF.
Romania To Hike Pensions With Inflation Rate Not Depending On Avg Wage Under IMF Agreement - Sources
25 mart. 2009, 10:04, English

Sources close to the negotiations between Romanian authorities and the IMF told MEDIAFAX the change will be introduced in the following years, but the change won’t have immediate effects as authorities aim to stabilize the public pension system in the long run.

Late January, the Romanian government decided pensions will increase 5% this year, 3% starting April and another 2% starting October. Also, the minimum social pension was set at 350 lei (EUR1=RON4.2924) in two stages, as of May and as of October.

Labor minister Marian Sarbu said at that time the 5% increase takes public pensions to 43.2% of the country’s gross average salary, instead of the 45% stipulated in the governing program.

Under the current system, pensions are calculated at the beginning of each year depending on the average gross salary for the respective year calculated by the country’s National Forecast Commission, or CNP. The commission’s mot recent forecast sees the average gross salary up 5.8% this year, to RON1,693.