FinMin admits document sent to EC, says tentative budget scenarios include freezing public sector wages, earlier enforcement of wage law Minister of Public Finance Eugen Teodorovici and Liberal Senator Florin Citu traded fire over the next state budget draft, following a document the Ministry of Public Finance sent to the EC listing a set of measures pondered in order to keep the budget deficit within the limit of 3 percent of GDP. Senator Florin Citu published a fragment of the document on his Facebook account, blaming the government that it plans to default on its promises. In reply, Finance Minister Teodorovici on Saturday told Digi24 TV channel that the document on the tentative freezing of public sector wages, presented by Liberal Senator Florin Citu, is public and was sent to the European Commission as a working document, as a variant to consider. According to the document sent to the European Commission and that was also posted by Liberal Senator Florin Citu on his Facebook page, the measures contemplated for drafting the 2019 budget blueprint include freezing wages in the public sector at the level of 2018 (the uniform wage law would no longer be applied) and keeping the value of holiday vouchers the same as in 2018, respectively at 1,450 lei / employee. Another possibility is to keep the average number of employees in the public sector the same as in 2018. Florin Citu posted on his Facebook page on Saturday that PSD and ALDE are thus no longer enforcing the unitary salary law and are admitting the failure of the governance programme. “PSD has betrayed and lied to Romanians. Romania in economic crisis – PSD introduces austerity measures in 2019. In a document remitted to the European Commission a few days ago, PSD+ALDE promise the freezing of public sector salaries in 2019 at the level registered in December 2018. PSD+ALDE are no longer enforcing the unitary salary law (thus admitting the failure of the governance programme and confirming me). This means salaries are cut by the equivalent of the inflation rate. Moreover, the interest rate hike will also cut the purchasing power even more,” the Liberal Senator said. Florin Citu also claims that the pensions law is a lie. “It’s clear that the pensions law is nothing but a lie. There isn’t money to enforce the unitary salary law and PSD+ALDE lie that they will double the pensions,” the PNL Senator writes. The document excerpt presented by the Liberal Senator points out that the Romanian Government is taking these measures “to ensure a cash deficit of 2.58 percent of GDP in 2019 and, implicitly, to correct the deviation from the medium-term objective (by lowering the structural balance from 3.17 percent of GDP in 2018 to 2.71 percent of GDP in 2019).” The Medium-term Objective (MTO) represents the budget deficit target of 3 percent that Romania committed itself to observing at the European Commission’s request. This target was established as a result of the imbalances registered by several countries during the recent economic crisis, its purpose being to maintain government expenditures as low as possible, especially during other economic crises. Last year, Romania registered a budget deficit of 2.96 percent of GDP last year, and the budget deficit was close to 3 percent in 2016 too. The Liberal added that, given the PSD-ALDE promise included in the document remitted to the European Commission, the ruling coalition will in fact cut salaries by the equivalent of the inflation rate. “This means salaries are being CUT by the equivalent of the inflation rate. Moreover, the hike of interest rates will lower the purchasing power even more. In the picture, the measures that PSD promises to take when forming the budget for 2019. It’s clear that the pensions law is nothing but a lie. There isn’t money to enforce the unitary salary law and PSD+ALDE are lying that they will double the pensions,” the PNL Senator explained. Florin Citu also announced that in the following days he will make public a report on the country’s economic situation. The public sector salary law was adopted by the House in early June 2017, during the Grindeanu Cabinet. Teodorovici: The authorities are also weighing in on enforcing the wage law ahead of term, by 2020 instead of 2022 In response, Teodorovici says that the authorities are also weighing in on enforcing the wage law ahead of term, by 2020 instead of 2022. “It is a document sent to the European Commission, a working document, so to say, a possible variant sent to the European Commission because this is the way the government has been working for years, and all member states are doing this: send the European Commission debates, scenarios, calculations for a final decision to be made one way or the other. In a few weeks we will table to the government the 2019 budget bill where the final version will be put on paper. This is a discussion, a scenario proposed by the Ministry of Finance, based on calculations, and there is even a proposal to apply the wage law not until 2022, but by 2020, just to clearly show that we are very sure of what we are doing, that we are not applying measures beyond the term of this government, ie 2020. Moreover, I must emphasize once again that the PSD-ALDE government has put into practice everything it promised. It didn’t cut the Romanians’ incomes,” Teodorovici explained. With regard to the possible freezing of public sector hiring, the Finance Minister said that freezing the number of employees in the central public administration is indeed a working scenario, as a way to resettle, restructure, render efficient the central public administration, because a long-term common sense observation is that a much more efficient administration is needed. “As an example I gave in previous interventions, I said that in the Ministry of Finance, support jobs are somewhere at 18 percent of the ministry’s personnel, and in other ministries they are somewhere at 30 percent…
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