PM Bolojan: Measures taken so far, budgetary discilpine enough in maintaining budget deficit at 8.4pct in year-end

Prime minister Ilie Bolojan on Monday evening stated that the measures taken so far by the Government, while maintaining budgetary discipline and staying within the amounts allocated for each ministry, ensure a deficit of 8.4% at the end of the year.He was asked if Romania would still fall within the 8.4 deficit target agreed with the European Commission in the case in which the coalition was no longer able to make new decisions before the end of the year and was forced to maintained only the decision taken until now, close to October 1."With the measures we have taken so far, if we maintain budgetary discipline and stay within the amounts allocated for each ministry, we are within this figure at the end of the year," Ilie Bolojan told Digi 24 private television broadcaster on Monday evening.The prime minister emphasised, however, that Romania needs to continue to decrease state spending."But as I told you, whether we want it or not, we have to admit that we need to continue reducing our state spending, because there are still many places in public institutions, where the staff, whether we like it or not, is oversized, there are places where things can be done more efficiently, with lower costs, and all these places must be considered one by one and measures must be taken gradually, while also keeping in mind that spending reduction measures, when they are taken, do not have effects from one day to the next. We will see in two months, in three months, in four months, because laws need to be adopted, we need time for debate, we need decision-making transparency, we need publication, some measures are being contested and so on. You can see what is happening right now, the second package that was adopted is being challenged with the Constitutional Court and the Court is due to rule in the coming days, so all these spending cuts will be seen next year and we must continue to support them, in such a way as to balance our spending," Ili Bolojan stated.He underscored that the level of indebtedness will increase and conditions for development will no longer be created if spending is not cut further."Even though we have a lower level of indebtedness than other European countries, the growth of Romania's debt has been too fast, we have grown by almost 1% every quarter in recent years. (...) This means that, no matter what government we have, if we do not reduce these expenses, the interest rates will be higher and higher, because we will borrow more and more and we will end up in a situation where we will have no space to be anything but a payment agency, this government, and we will no longer be able to create conditions for development. That is why things are stable, but what we have done so far on the expense reduction component is not enough. On the tax component, we had to take these measures because otherwise in July we would have had serious financial stability problems, and also now, on the tax component, where we no longer have to take measures to increase taxes, we have to collect these taxes, everyone who has to pay must understand that they must contribute these taxes to the state budget, to fight against fraud, tax evasion," Bolojan explained.  He added that, at the moment, there were not any proposals for new tax or levy increases for next year, neither in the discussions within the governing coalition nor in negotiations with the European Commission.'At the moment, we do not have such proposals, neither in negotiations with the Commission nor in discussions within the Government or the coalition. But as I have said before, the issue is not raising taxes, but rather reducing our expenditures,' Ilie Bolojan clarified on Monday evening, on Digi 24 private television broadcaster, when asked whether, apart from the increase in local taxes due to come into force on 1 January 2026, other tax or levy hikes are being considered for next year.The head of the Executive explained that in 2026, the effects of the measures taken by the current government so far will become more evident.'The measures taken so far have certain effects, and in 2026 we will begin to see these effects more clearly. The cumulative effects should amount to over 2% of the Gross Domestic Product. That's why we aim for next year's deficit to be brought closer to 6%, so roughly 8.4 minus 2%, therefore under 6.5%, in order to gradually reduce the loans Romania is contracting, stabilise interest rates, and create budgetary space to support investment projects, so that our country can develop in the years to come,' Prime Minister Bolojan explained. (Photo: www.gov.ro)