Government adopts the pension bill

The Government promises to increase pensions starting 2024

Bogdan Matei, 10.11.2023, 14:00

Most
of the five million pensioners in Romania are some of the poorest at European
Union level. The average pension in September stood at a little over 400 EUR,
the National Statistics Institute reports. Due to inflation, bills, food and
medicine have sky-rocketed, while pensioners’ spending power has gone down. Since
1990, all governments, irrespective of orientation or political ideology, have
promised to show more consideration for Romania’s elderly, and the current
Cabinet makes no exception, promising to become a champion of generosity, the
first to increase pensions twice in a single year. A new pension law was passed
by the Government on Thursday, not without a tough negotiation between the
Labor Ministry, controlled by the Social-Democrats, and the Finance Ministry,
controlled by the Liberals, the media notes. The Cabinet meeting was postponed
hours on end, as the Social-Democratic Party and the Liberal Party in the
ruling coalition worked with different numbers as to the impact the new bill
would have on the state budget. The Liberals said it would translate into 3% of
the GDP, much higher than the original estimates, while the Social-Democrats
claimed the coalition partners were mistaken. Finally, the two parties agreed
the increase would be implemented in two phases: one on January 1, when
pensions will go up by 13.8% for everyone, then a second phase on September 1, through
recalculation.

Labor Minister Simona Bucura-Oprescu says the recalculation will
help level out inequities between Romanians with different degrees of seniority
or between men and women. Overall, pensions will go up 40% by the end of 2024.
Prime Minister Marcel Ciolacu, the president of the Social-Democratic Party,
wants to fast-track the bill in Parliament so that it should be voted by
November 20 and take effect on January 1, 2024. Following Thursday’s meeting,
Finance Minister Marcel Boloș said increasing
pensions is a priority but also a responsibility for the government, which
should also ensure the country’s financial stability. Senate Speaker and Liberal
Party president Nicolae Ciucă, says that the
Liberals have always supported the increase of pensions, although in a
sustainable way. The media writes the pension bill was also discussed with
World Bank experts, and that negotiations were attended by both the Labor and
Finance ministers. From the opposition, USR has accused the ruling parties of defrauding the state
budget for two years, the consequences of which are visible today: the state
does not have the funds to sustain the pension law. (VP)