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| GOVERNMENTAL FORECASTS 06/03/2009 |
| (2009-03-06) |
| Last updated: 2009-03-07 16:01 EET |
High-income state-employees may not benefit from a salary increase in the forthcoming period, yet their incomes are not going to be on a downward trend, either. However, salaries in the low-income bracket in the public sector will rise, so that a balance can be achieved between various categories of employees. Romanian Prime Minister Emil Boc specified all that, also adding that the forthcoming law on the unique salary quota in the budgetary sector will regulate the system. Here is what Emil Boc said in an interview for Radio Romania:
"No salary will be subject to decrease in Romania once the unique salary quota has been adopted. In other words, the gained rights will be kept, but only until the required balance is achieved, from the standpoint of a fair salary system. Those with lower salaries will see a higher increase, as compared to those in the high and top income bracket; for some time, the latter’s salaries might face stagnation."
Until its completion, stipulated for late April, the unique salary quota draft law will be subject to debate for trade unions, owners’ associations and other structures of the civil society, as well as for all specialized ministries. The draft law might be included in the Parliament’s debate list in May. The law – the Prime Minister said – will introduce a set of principles and criteria providing the framework for each category of employees in keeping with their background, performances and importance of each profession. Emil Boc also explained that the absence of a unique salary quota in the budgetary sector made possible the emergence of the sector salary law, hence a series of major discrepancies between people paid from public money. In another development, the Romanian Prime Minister said a possible increase of the flat tax rate couldn’t make a feasible solution for Romania at the moment.
According to Boc, maintaining the flat tax at 16% turned out to be an income-generating tax rate for the state budget; also the flat tax foiled the underground economy, encouraging the business environment to pay its taxes and duties. For the time being at least, the government does not intend to extend the retirement age limit, Boc also told the public radio station. Previously the World Bank recommended the Romanian authorities to extend the retirement age limit, to reduce recent pension increases, and the stipulation of clear specifications regarding pensions’ indexation. The World Bank also said Bucharest officials will have to solve problems related to the workforce competitiveness, and the quality of management and monitoring processes.
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