The new Victor Ponta cabinet

Romanias parliament has given its vote of confidence over the action plan of the countrys brand new government.

Roxana Vasile, 12.03.2014, 13:54

Approved by Parliament a week ago, the third Ponta cabinet is now to implement the updated political platform on which the Chamber of Deputies and the Senate gave their vote of confidence. There are no big differences from the previous platform proposed after the 2012 legislative elections, despite the fact the Democratic Union of Ethnic Hungarians has replaced the National Liberal Party in the government.

For the next two years and a half, the new government, which also includes the Social Democrats, the Conservatives and the National Union for the Progress of Romania, will implement the same principles on which the 2014 budget is founded. The 16% flat tax rate will be maintained, and priorities will include the reduction of social security contributions and the introduction of a tax exemption for reinvested profits.

According to prime minister Victor Ponta, contributions paid by employers to social security funds will be slashed by 5%, the VAT will be lowered from 24% to 19%, and the VAT for basic foodstuffs will be further reduced. All these measures, however, will be taken only when the fiscal framework allows it. The prime minister also urged MPs to resist the temptation of taking populist measures this year. Victor Ponta:

“Let us not make the same mistake we all made in 2009 before the presidential elections, when we raised people’s expectations and made all kinds of promises before heading straight for disaster in 2010.”

The Liberal leader Crin Antonescu, however, sees the action programme of the third Ponta Cabinet as vague and election-driven:

“Even a statement of principles and intentions must contain very specific elements. We basically don’t know whether these measures can be implemented and when. They speak about some measures being taken when the fiscal framework allows it. I say they should then create a budgetary framework that allows the things they promised.”

The Liberals say, however, they will not table a motion of censure in the near future, unlike the Liberal Democrats, who have drawn up the content of such as a motion. The leader of the Liberal Democratic Party, Vasile Blaga:

“If you look at what the prime minister says, you see he promises few things this time. To do more, he says he needs more support. So instead of looking at the available resources and establishing his goals depending on these resources, in areas like investments and the reduction in social contributions and VAT reduction, he just says maybe.”

However, the Liberal Democrats don’t have the minimum required number of signatories to initiate the censure motion without the support of the Liberals, but the latter announced they would wait at least until May to make up their minds.