Romanian Unions Frown On Draft State Budget

Union leaders added the government should expect ample protests next year.

Cartel ALFA union federation leader Bogdan Hossu said Wednesday, after a talk on the state budget at the Finance Ministry, that the draft budget shows the government isn't keen on fighting tax evasion and keeps discriminating between public and private sector employees.

Hossu said the social security budget freezes pensions and only increases special pensions with about 4%, the inflation rate, which again spells discrimination toward people who worked and contributed to the system.

"Instead of increasing the pension point to the target of 45% of the gross average wage, it will decrease to 39% according to the draft budget," Hossu said.

Hossu also said the salary fund will decrease to RON0.7 billion, which translates into 80,000 job cuts next year, while the number of jobless people in the private sector is estimate to decrease by 90,000.

Romania's jobless arte is forecast at 6.8-6.9% for 2010.

National Union Bloc head Dumitru Costin said the state budget doesn't fix the country's major problems and said he is displeased the Health Ministry wants to introduce yet another tax, the co-payment system. He said it is abnormal for nearly five million people (Romania's active population) to contribute to a system that serves 20 million people and called on the Finance Ministry to find solutions.

Romania's Prime Minister-designate Emil Boc seeks a confidence vote in Parliament Wednesday for his 15-minister cabinet, which needs to push through next year's state budget and unlock further tranches of an IMF-led EUR20 billion loan the country relies on.

If the government secures a confidence vote it plans to hold a Cabinet meeting later in the day to approve the state budget, which it will then forward to the Parliament for approval.

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