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| THE WEEK IN REVIEW 17-23/08/2009 |
| (2009-08-21) |
| Last updated: 2009-08-24 16:44 EET |
The parties making up the ruling coalition in Romania, the Social Democratic Party and the Liberal Democratic Party, agreed on Monday to a new set of 32 anti-crisis measures, due to come into force on September 1st. The measures are aimed at boosting the economy, raising revenues and cutting budget expenditure, as well as increasing monetary liquidities in the banking sector. The package includes measures such as: support for the SMEs in difficulty, the granting of loans for the renovation and refurbishing of houses, tax exemption for reinvested profits, extending the renewal program for old cars and also measures targeting legal persons.
The liberal opposition, economic analysts and the media are rather skeptical about the so called “new measures”, saying that a large proportion of them had been promised a long time ago and were supposed to be implemented early this year. They are also suggesting that some, though not many, of the measures have already been put into place, and that the government was not aware of this. Moreover, the coalition has failed to mention how much the implementation of this new package will cost the taxpayer, and where will the money come from. In August and September, Romania will get a ‘bonus’ from the IMF, that is, special withdrawal rights worth some 1.4 billion dollars. The measure is part of a larger program under which the IMF will supplement the member states’ liquidities by increasing hard currency reserves.
On Thursday, the Romanian Government announced the continuation of stakeholder negotiations on the draft law on the single payment system for state employees. The law is included in the loan agreement concluded with the IMF in spring, aimed at helping Romania overcome the economic crisis. The law intends to do away with large discrepancies in the payment system for state employees and also to reduce certain bonuses. The Prime Minister said that the optimum solutions would be discussed with all the stakeholders, before being promoted by the Government, which wants to assume responsibility for this law before parliament. Emil Boc:
“First and foremost this should be a fair law, a law that brings fairness into the payment system - and also a simple law, that everybody can understand. Also, it is equally important that it is passed and implemented within the established time frames.
Romania needs an effective education system, that looks forward to the future, not backwards to the past, said Romanian President Traian Basescu during a public debate on the education laws. The legislative package aimed at reforming education in Romania is a bone of contention among the ruling parties. The liberal democrats prefer the draft set forth by a presidential committee and would like the government to assume responsibility for it. On the other hand, the social democrats support the package drafted by their party colleague, Education Minister Ecaterina Andronescu, and call for Parliamentary debates on it.
One of the very few things we’ve been sure of this week is that many employees within town and city halls, local and county councils will be made redundant, to save money and reduce state budget expenditure. Finance and interior officials, as well as local administration representatives, have agreed that norms need to be developed on staffing, in order to readjust the number of state employees. The Romanian Finance Minister, Gheorghe Pogea:
“We intend to develop norms on staffing and cost standards that will show how many people should work in the public administration sector in order to provide quality services. What is certain is that the current number of employees in this system is too high, though I cannot give the exact figure. It is also a matter of certainty that cutting personnel expenditure will automatically trigger personnel downsizing.”
Early this week, Romanian policemen protested in the capital and in the big cities against the authorities’ decision to cut some of their compensatory payments, including rent payments for those posted to other localities. The presidency wanted to broker the conflict, but the talks were postponed, due to a lack of agreement between trade unions.
Three of the four Romanian football teams that played in the Europa League play offs on Thursday stand big chances of making it to the group stages. Steaua Bucharest beat Saint Patrick’s Athletic, 3 nil, FC Vaslui defeated AEK Athens 2 - 1 and CFR Cluj ended their match against FK Sarajevo with a draw. On the other hand, Dinamo Bucharest run the risk of being excluded from the European competitions for a few seasons, after the team’s supporters took to the pitch during the match played on home turf against Slovan Liberec. As a result, the referee was forced to put an end to the match before full-time.
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