Romanian Govt Pledges To Peg Public Salaries To Private Sector, Cut Bonuses

Romania’s Government pledged, in the new letter of intent to the IMF, to provide fewer bonuses in the unitary wage law, as well as implement a system to correlate the salaries in the public sector with those in the private sector and set them according to each employee’s duties and skills.

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The technical memorandum included with the additional letter of intent to the agreement with the IMF contains an ample section on the public sector unitary wage law. It says the Government will carry out a study of the labor market, to make suer that public servants' pay is in line with current market conditions.

The Government has also promised it will not send the amended wage law to the Parliament without the approval of the IMF and European Commission. The amendments are to be adopted by the end of October.

The additional letter to the loan agreement with the IMF was adopted by the Government on Wednesday. The document was developed with the input of IMF experts following the Fund's evaluation mission to Bucharest, between July 26 and August 4, to release the six tranche of the loan, worth more than EUR900 million.

Romania and the IMF last year signed a EUR13 billion loan agreement, part of a larger EUR20 billion aid package that includes funds from the EU and other international lenders.

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