Romania’s Govt To Seek Parl Confidence Vote For Pension, Wage Cut Laws

The draft laws will be submitted to Parliament after they are approved by the Economic and Social Economic Council.

Boc announced the decision Wednesday, after talks with ruling coalition representatives.

According to Boc, the Government expenditure cuts will not cause salaries and pensions to drop below the minimum rates of 600 lei (EUR1=RON4.1724), and RON350, respectively. The minimum guarantee income will be lowered and granted only to people facing financial duress.

Leaders of Romania's centrist coalition of democrat liberals and the Hungarian minority party met Wednesday morning at the Government's headquarters to discuss the country's letter of intent to the International Monetary Fund, which the Government will adopt later in the day.

Recession-hit Romania, which is relying on a EUR20 billion rescue loan from the IMF, EU and the World Bank, has pledged to take drastic measures to cut public spending and bring the budget deficit to below 6.8% of the GDP from 7.3% last year.

The measures include a 25% cut in public sector wages and a 15% cut in pensions and social welfare benefits, which prompted thousands of people to stage the biggest demonstration rally of the past 19 years outside the government building last week, hoping to pressure authorities into watering down their austerity plan.

Unions have promised to go on full-blown strike as of May 31, freezing public road and rail transport across the country, halting activity in schools, hospitals and public institutions.

The Government, which has been threatened with a no-confidence motion by opposition lawmakers, plans to adopt its austerity plan by seeking a confidence vote in Parliament.

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