Romania’s PSD returns to power after landslide victory

Romania’s PSD returns to power after landslide victory
By bne IntelliNews December 12, 2016

Romania’s centre-left Social Democratic Party (PSD) won a convincing victory in the general election on December 11, amid low turnout. The party does not have a majority by itself, but will be able to form a government with its ally, the Alliance of Liberals and Democrats (ALDE). 

It is still uncertain who the PSD’s nomination for the prime minister post will be as the party has made no firm announcement in this respect so far. After the final results are released, President Klaus Iohannis will start talks with every parliamentary party on the new prime minister. He has said he will not endorse a premier who has been investigated or convicted for corruption related offences. However, the strong performance of the PSD means the party could be emboldened to nominate its president Liviu Dragnea despite his conviction for voter manipulation. 

The PSD won 45.93% of the votes for the Chamber of Deputies, Romania’s lower house of parliament, and 46.11% of the votes for the Senate, according to preliminary results presented by the central electoral bureau (BEC) and quoted by Digi24.ro after 98.6% of the votes had been counted. ALDE has a further 5.64% of the vote for the Chamber of Deputies and 6.01% for the Senate.

The PSD was followed by the centre-right National Liberal Party (PNL) with 19.88% backing in the Chamber of Deputies and 20.27% in the Senate. In third place was the newly formed Save Romania Party (USR) with 8.53% support in the Senate and 8.46% in the Chamber of Deputies, followed by the Democratic Alliance of Hungarians in Romania (UDMR) – 6.30% in each of Romania’s two houses of parliament. The People's Movement Party (PMP), the party founded by former president Traian Basescu, got 5.34% of the votes for the Senate and 5.06% for the Chamber of Deputies.

Candidates for the top job

Following the announcement of the exit polls’ results, Dragnea gave ambiguous answers to reporters on the question of the country’s next leader, as speculation about the nominations for the prime minister post reached a frenzy. 

“I will respect and take into consideration the vote of the Romanians, the Constitution and the governing programme,” Dragnea said. “I am not going to make fun of today’s votes and not planning to give them as present to others, persons or institutions, and not to treat them with indifference,” Dragnea added.

ALDE leader Calin Popescu Tariceanu recently announced that the PSD and ALDE would make a joint nomination. However, it is unknown who that person would be, considering that current legislation forbids citizens with criminal convictions from serving as members of the government. Still, the Constitution does not put any restriction in this respect and Dragnea said after the vote he would respect the Constitution. Dragnea has ruled out the PSD accepting a nomination from another party for the post.

Former Prime Minister Victor Ponta recently told DCNews that the party could nominate Dragnea, former Finance and European Funds Minister Eugen Teodorovici or former Labour and Environment Minister Rovana Plumb for the post.

Bucharest’s PSD mayor Gabriela Firea wrote on her Facebook page that Dragnea is entitled to become prime minister. “The PSD’s historic victory is due to the Romanians who believe in our governing programme, but this document could have not existed without the involvement of the PSD leader and his team spirit,” she wrote.

Rage against corruption fades 

The PSD is returning to power one year after its government had to resign following mass protests in Romania’s capital and main cities triggered by citizens’ disgust and rage against corruption after a fire in a nightclub took the lives of 64 innocent young people.

The vote could also be an indication of Romanians’ declining interest in the country’s anti-corruption fight. Dragnea, who could be the party’s nomination for the prime minister post, has already received a two-year suspended sentence for voter manipulation and has been indicted for instigation to abuse of power and instigation to forgery. However, this did not affect the leader’s popularity in the election, and nor did the investigations into other PSD candidates such as Ponta and Craiova mayor Lia Olguta Vasilescu. Tariceanu is also being investigated by the National Anticorruption Directorate (DNA) for influence peddling and false testimony.

While thousands of people took the streets of Bucharest last year showing their readiness to do whatever it takes to fight the corrupt system, it seems people’s determination has started to fade. This was shown by the low turnout, which offered an advantage to the PSD, known for its ability to mobilise its loyal electorate to go to the polling stations. Only 39.49% of the electorate voted in the parliamentary elections.

At the same time, people’s interest might have become more focused on their personal gain rather than a common fight against corruption and a desire to implement reforms. In its election manifesto, the PSD promised further salary and pension increases and tax cuts. In a bid to maximise its popularity ahead of the elections, PSD MPs have drafted and voted in an ordinance envisaging salary hikes in the education and healthcare sectors. Also, a bill cutting more than 100 official fees was approved.

“Today, citizens voted for economic growth, for jobs, for more money into the pockets of Romanians,” Dragnea said after the release of exit polls. 

According to the PSD’s manifesto, the minimum gross wage will be raised to RON1,400 (€310.4) in 2017 and further to RON1,510 in 2018 and RON1,625 in 2019 before finally reaching RON1,750 in 2020. The PSD’s governing programme also envisages that the average gross salary will reach RON3,100 in 2017 and RON3,950 in 2020. Pensions are also expected to rise. In 2018, the PSD plans to cut social security contributions to 25% from the current 26.3%, cut the VAT rate to 18% and totally eliminate VAT on home sales.

Technocrats versus populists 

Preceded by probably one of the most apathetic and quiet electoral campaigns in Romania due to changes in the electoral legislation, the elections can be seen a battle between Romania’s largest party, the PSD with its well known candidates (some of whom are being investigated for corruption) and the current technocratic PM Dacian Ciolos. Although he neither joined a party nor ran in the elections, former European Commissioner Ciolos was supported in the elections by PNL and USR.

Ciolos and his cabinet of technocrats were appointed by both the right-wing and left-wing parties in November 2015 after the Ponta’s cabinet resigned amid mass protests. Ciolos accepted the PNL’s and USR’s support for another mandate, but tried most of the time to keep a neutral stance, and avoided getting involved in the electoral campaign. However, at the beginning of December he said he was “ready and committed” for another term in office and admitted that he was involved in the electoral race on the side of the PNL and USR. His decision might have come too late, as he did not manage to convince undecided voters to come out and cast their votes for one of the two parties supporting him.

During their short term, Ciolos and his cabinet focused on reforming the public administration. While the PSD approved a number of populist measures, such as salary hikes, aimed at increasing the party’s popularity, Ciolos did not hesitate to take the unpopular measure of sending the bill envisaging salary increases to the Constitutional Court.  

Whoever the new prime minister is, his or her government will have to tackle a series of issues including the expected rise in the budget deficit caused by increased spending. The Constitutional Court is expected to hold discussions on the constitutionality of the approved salary hikes in the education and healthcare sector, as well as on the cuts in more than 100 fees, on December 14. The ordinance was challenged through the Constitutional Court both by the government and the PNL.

The International Monetary Fund (IMF) resident representative for Romania and Bulgaria, Alejandro Hajdenberg, told Agerpres news agency last month that the salary hikes would result in a budget deficit of around 3.5% of GDP next year. The European Commission has forecast that Romania’s budget deficit will reach 3.2% next year.

While the results represent a huge victory and comeback for the PSD, they are also a confirmation of the declining support for the PNL. According to sources quoted by News.ro, PNL leader Alina Gorghiu and general secretary Ilie Bolojan told leaders of county branches that they plan to resign. However, their resignation was not accepted and the two leaders were asked to remain in their posts until the next party congress.

After the results of the exit polls were announced, Gorghoiu did not accept defeat and said her party’s project - a new term for Ciolos - is still valid.

“Any match is played until the end and the objective we have set, to obtain parliamentary majority for the Dacian Ciolos prime minister project, is still in the cards, it depends very much on the final results and the results of smaller parties,” she said.

The Liberals also obtained a disappointing score in the June local elections, after proposing and withdrawing a number of candidates for the Bucharest city hall. The party lacked charismatic leaders and its co-leader Vasile Blaga was recently indicted for influence peddling.

Meanwhile, the PSD benefitted from media support, and the party managed to avoid repeating past mistakes during the campaign. At the same time, the use of nationalist rhetoric brought the leftist party additional votes.

The USR’s result can be considered a success, considering the party was formed only a few months ago, following the local elections. The party, which was formed by NGO activists and business leaders, emerged from the Save Bucharest Association which performed very well in the local elections for the capital city. Its leader, Nicusor Dan, came second in the race for the Bucharest city hall mayor.

The nationalist United Romania Party (PRU) will not enter the parliament, according to the preliminary results.

 
 

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