Romania’s government passes €1.1bn social package

Romania’s government passes €1.1bn social package
By bne IntelliNews May 24, 2022

Romania’s ruling coalition agreed on May 23 to launch a new package of social and economic measures under the broader Support for Romania scheme, estimated to cost the public budget €1.1bn.

According to past statements, the Support for Romania scheme is broader than implied by the ruling coalition’s statement of May 23 and will be financed from Romania’s funds left not used from the EU budget.

It was previously announced to cost €1.8bn in total.

Some social support was already passed by the government, including vouchers to low-income households and price corrections for the public infrastructure contracts aimed to unblock the projects.

The new package will come into force on July 1.

Among the measures included in the package and announced on May 23 is a facility allowing bank debtors to defer instalments for a period of nine months. The terms of the arrangement were not disclosed.

The ages in the public system will increase by 25% of the negative deviation from the Law on unitary pay for the employees in the public system, which was approved in the past but was constantly postponed.

Public pension recipients with monthly pensions of under RON2,000 (€400) will be extended a one-time RON700 payment.

The ruling coalition leaders also announced that the government will take steps to strengthen fiscal and public deficit commitments, by the reduction of budget expenditures by at least 10%, except for those with investments, salaries, pensions and social assistance.  There will be no hiring in the public system after July 1.

The absorption of the European funds under the operational programmes and the PNRR will be accelerated. In this regard, the coalition will conduct a monthly assessment of the state of absorption.

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