Romania Ctrl Bker: Public Sector Too Overcrowded To Allow Decent Pay

The authorities have put off personnel restructuring for too long, thus leading to a harsh 25% pay cut for public employees, said Lucian Croitoru, adviser to central bank governor Mugur Isarescu.

"The occupancy level is the main issue and the payroll level will remain a problem until the excess workers are dealt with," Croitoru said on the sidelines of a seminar.

On the other hand, Romania needs to make a new budget revision to achieve its fiscal goals, Croitoru added.

Hundreds of employees at the finance and labor ministries staged nationwide protests over the last two days, demanding their wage bonuses be reinstated.

Romania had to implement a series of austerity measures this summer to keep the budget deficit in check and make sure its EUR20 billion aid package from the International Monetary Fund and other lenders stays on track.

The measures included slashing public wages by a quarter and raising the value added tax to 24% from 19% previously.

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