Romanian Fin Min Threatens To Resign If Parliament Lowers Social Security Contributions

"You can't be a finance minister in the context in which budgets are off-balanced by laws that are not based on reality. We don't hide the money. If we had 120% more than we currently have, meaning 2% or 3% of the GDP, we would direct more money to the health sector or infrastructure," Vladescu said.

Vladescu added he will also resign if pensions are hiked, adding he also opposed pension increases back in 2004.

"If the Parliament approves these decisions, another finance minister will be needed to apply them, as I cannot work with a budget other than that we have at the moment," said Vladescu, adding he wants to make budget adjustments by applying the measures initially announced, namely freezing wages and laying off employees in the public sector.

Vladescu said the country will see an inflation increase which represents a great risk for Romania if these measures are not enforced.

The minister highlighted that nearly 100,000 employees in the public sector will be laid off in 2010.

Romania's Parliament commissions for labor and health Wednesday approved an amendment to the social security budget for 2010, according to which employees' and employers' social security contributions will be reduced, although the draft budget stipulated they would remain at last year's level.

According to the amendment approved by lawmakers in the commissions, the contribution quotas will be set at 21.8% for normal labor conditions, of which 9% will be paid by employees and 12.8% by employers, at 26.8% for particular labor conditions and at 31.8% for special labor conditions.

According to the social security draft budget, social security contributions should have been maintained at the last year's level, both for employers and employees.

Thus, social security contribution for normal labor conditions should have been of 31.3%, as in 2009, of which 10.5% were to be paid by employees and 20.8% by employers, social security contribution for particular labor conditions should have been kept at 36.3%, and that for special labor conditions at 41.3%.

At the moment, contributions paid by employers and employees are of 40.05% of the gross wage, although it should have dropped by 2%, from 39.5% to 37.5%, starting January 1, 2009.

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