Romanian Union Leaders Say Spending Cut Measures Will Be Applied Until Dec 31, 2010

Cartel Alfa union federation leader Bogdan Hossu said Sunday, at the end of the meeting, that he proposed to the head of state several alternative solutions to the recent spending cut measures. Hossu stressed that he proposed to reduce social security contributions and to stop transferring 0.5 percentage points of employees' social security contributions from the public pension system (Pillar I) to the mandatory private pension system (Pillar II). He pointed out that this would save EUR400 million and bring additional revenues to the National Pension House, which could further help no longer reduce public pensions.

According to Hossu, a crisis body consisting of unionists and representatives of employers, Government and political parties will be set up in order to analyze recent spending cut measures and to seek alternative solutions. Hossu added the crisis body will convene Tuesday for the first time in order to discuss unionists' demands and stressed that unions will decide whether or not to discard planned protests depending on the outcome of talks.

The union leader underscored that he also called for a new round of talks on the minimum salary, which, he deemed an important factor in the fight against tax evasion.

As regards layoffs in the public sector, Hossu said he urged the setting up of a committee to analyze the program of layoff measures, as well as their criteria and application. He also said unionists requested that any reduction in the salary fund be discussed with them, for each and every field of activity.

Hossu went on saying that labor legislation will be amended with respect to taxation clauses and that copyright will be taxed like any other income.

The meeting held Sunday at the presidential palace, at unionists' request, was attended by representatives of the country's five large union federations, namely, the National Union Confederation "Cartel Alfa", the National Confederation of Free Romanian Unions - "Fratia", the Confederation of Democratic Romanian Unions, the National Union Bloc and the National Union Confederation "Meridian", as well as by representatives of union federations in education and public administration.

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.

Basescu said Romania is forced to drastically cut public spending to avoid raising its main taxes and called on unions to assume their part of the responsibility for the allotting of funds in public institutions.

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