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| MEASURES, PROTESTS AND SOLUTIONS 12/05/2010 |
| (2010-05-12) |
| Last updated: 2010-05-13 13:51 EET |
Trade union members have said they will hold daily rallies and protests, and an indefinite all-out strike is scheduled for the end of this month that will bring the entire state sector to a halt. The most controversial measures planned by the government are the 25% reduction of the salary budget in the public sector, as well as the 15% reduction of pensions and social benefits which will come into force as of June 1st. After meeting trade unions and employers' associations, president Traian Basescu said that, for the time being, Romania could not adopt a better solution than the one agreed on with the IMF and the EU.
The meeting was boycotted by opposition parties, the Social Democratic Party, the National Liberal Party and the Conservative Party, which rejected the government’s severe measures and proposed instead several alternative solutions. The social-democrats are proposing a differentiated taxation and actions to relaunch the economy; the Liberals want the reduction of the cabinet to only 7 ministries and of subordinated agencies, as well as cuts in the budgets of institutions that cannot make investments.
The conservatives also call for an end to the purchase of goods and fixed assets in the administration and to investments that do not result in the creation of more jobs, as well as the restructuring and privatisation of under-performing state companies and the elimination of the minimum tax. President Basescu, however, believes that the opposition's solutions are not backed by figures. He drew attention to the fact that, without the agreement with international financial bodies, the budget deficit target of 6.8% of the GDP cannot be attained. Moreover, the president said, along with the approximately 3 billion euros that it will receive from the IMF by the end of the year, the government must borrow another 5 billion euros from the market to be able to pay salaries and pensions. Traian Basescu:
“I would like to ask politicians, the media, trade unions and the business environment, to tell me how could Romania borrow 11.7 billion euros to cover its deficit without an agreement with the Fund. It would mean an immediate stop, not reduction, to the payment of salaries and pensions.''
Bogdan Hossu is the head of the Cartel Alfa Trade Union Confederation. He also slammed the government's austerity measures. Bogdan Hossu:
''The reduction of the salary system planned by the government refers to the individual reduction of salaries, and not the reduction of the salary budget. Taxing meal vouchers will create problems for the economic sector. Not to mention that there are many other problems related to pensions.''
On the other hand, Cezar Coraci, the head of the employers' federations in the industrial sector, believes that the current economic situation calls for extremely tough measures, and that the political class must be responsible and show solidarity. Cezar Coraci:
''If the proposed measures are not be approved by the government, Parliament and then later by the IMF, the agreement with the Fund will indeed be temporarily suspended and it is very likely that Romania will not have money for salaries and pensions next month.”
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