Romania’s Govt To Freeze Pensions In 2011

Romania’s Government will not increase pensions in 2011 and will eliminate the 13th salary, vacation bonuses and heating subsidies, according to an additional letter of intent to the stand-by agreement with the International Monetary Fund, obtained by MEDIAFAX.

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The Government also pledged to revise the Labor Code and the laws regulating the labor market, including those regarding salary negotiations.

By implementing these measures, the Executive estimates it will save revenues of at least 0.2% of the gross domestic product.

The Government also said that the provisions regarding pension adjustment will be implemented starting 2012. It also pledged to increase the level of contribution to the mandatory private pension system (Pillar II) to 3% next year, from 2.5% currently.

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