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Romanian Govt Rejects Rail Co CFR Marfa’s 2011 Budget Over Forecast Losses

Romania's Government on Wednesday approved the budgets of several state-run companies, but rejected that of rail cargo carrier CFR Marfa, with Prime Minister Emil Boc arguing that a budget's first draft shouldn't forecast losses, but at most zero profit.
Romanian Govt Rejects Rail Co CFR Marfa's 2011 Budget Over Forecast Losses
Radu Bostan
16 feb. 2011, 20:38, English

Transport Minister Anca Boagiu explained the budget pointing to CFR Marfa’s long outstanding debts to the state budget, plus interest and penalties for overdue payment. The prime minister replied that he is aware of the company’s arrears and asked Boagiu to revise CFR Marfa’s budget and present it again, together with a restructuring program, people close to the matter told MEDIAFAX.

On Tuesday, CFR Marfa’s management and its workers’ union signed the collective labor contract for 2011, which provides protection for the employees to be made redundant as the company is restructured.

Union leader Iulian Mantescu said about 6,000 railway employees risk losing their jobs in March and April under the Government’s restructuring plans and unions are determined to use all their powers to prevent that. According to him, Romania’s railway system currently employs 56,000 people with an average net salary of 1,600 lei (EUR1=RON4.2584) per month in 2010 and collective work contracts expired on January 31.

The Government plans to sell a minority stake in CFR Marfa by end-2011, according to the country’s draft letter of intent agreed with the International Monetary Fund. The company will be fully privatized when market conditions allow it, the document said.

CFR Marfa reported 3.5% wider losses to 354.2 million lei (EUR1=RON4.2584) in 2010, despite a 4% increase in operations. Its rolling stock includes over 42,000 freight cars and more than 900 engines.