Romania Fin Min: Political Changes Justify Compensatory Payments To State Co Managers

Romania’s Finance Minister Sebastian Vladescu on Thursday said that theoretically, the managers of state-owned companies operating in the public sector should get compensatory payments only as a form of protection, when discharged from office after a new governing power takes helm.

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"I don't think they (managers in the public sector, e.n.) should get compensatory payments or be replaced whenever a new ruling power takes office. If these payments represent a form of protection, then, I totally agree," said Vldescu, when asked to voice his standpoint with respect to compensatory salaries and payments granted to the managers of state-owned companies.

When asked to comment on the salaries paid to the staff of state-owned investment fund Fondul Proprietatea and state-owned lender Eximbank, Vladescu said the bank is not subordinated to the Finance Ministry.

Vladescu added, however, that the salaries of the managers of state-owned companies should not be a secret to anybody.

Late December 2009, Fondul Proprietatea said the fund's new head Ionut Popescu requested his contract contain no clauses regarding compensatory payment in case of early termination.

In addition, Popescu demanded his salary will not exceed the one paid to former general manager Daniela Lulache.

The Fund also said at that time the other two members of the fund's administration board, namely Cristian Busu and Valeria Nistor, were to receive salaries lower by some 25% compared with their predecessors.

Fondul Proprietatea is run by two boards as of May 2008. The supervisory board comprises seven members, while the administration board, which also has executive powers, includes three members.

Fondul Proprietatea was set up in 2005 to compensate Romanians whose properties were seized during communism.

Romania's Finance Ministry holds about 61% of Fondul Proprietatea's shares, while the remaining shares are distributed among private stockholders. The fund owns shares in nearly 90 companies, including Transgaz, Transelectrica, Alro, Romgaz and several power distributors.

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