Romanian President Says Benefits For Children, The Disabled Will Not Be Slashed

Asked to say if he agrees with unionists' proposal to force private sector companies to pay the price of crisis as well, Basescu stressed that companies in the private sector have already paid the price through a massive restructuring. He added the state managed reduce budget spending in 2009, only to a small extent.

The head of state also wondered whether higher taxes on companies, namely an increase in the flat tax and the value added tax to 20%, would guarantee higher revenues to the state budget.

The Government is considering taxing several social benefits, such as allowances for children or people with disabilities, by 15%, in an attempt to reduce budget spending, people close to the matter told MEDIAFAX Friday.

Dumitru Costin, leader of the National Trade Union Bloc, said Friday that, according to his "sources," the Government had decided to cut allowances for children by 15%.

Basescu said Thursday, after talks with International Monetary Fund officials, that pensions will decrease by 15% and salary funds in the public sector by 25%, which will also impact the minimum wage, adding subsidies will be drastically reduced.

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