Romania’s President Klaus Iohannis promulgates the new public sector salary law.
The recent political crisis in Bucharest has raised fears that the public sector salary law will be left aside for a while and its implementation delayed. Moreover, the removal of the Social-Democratic Cabinet headed by Sorin Grindeanu, who initiated the bill in the first place, and the prospects of its being replaced by a government of a different political colour had the pessimists believe that the law, benefiting a large part of the population, would be forgotten. However, everybody's fears were dispelled when it was announced that president Iohannis has promulgated the law.
A communiqué issued by the Presidential Administration reads that the head of state supports the need for a sustainable increase in the salaries of public employees, in order for their living standard to increase. The president has also stressed the fact that it is the responsibility of the parties that make up the ruling coalition - the Social Democratic Party and the Alliance of Liberals and Democrats - to ensure a balanced growth and to harmonise the income growth objective with that of maintaining Romania's macro-economic and budgetary stability. This law should solve the salary issues facing the public sector, but without causing other problems instead, the president also said. Any subsequent budget adjustments should be made in a transparent, credible and responsible manner, without affecting sectors of utmost importance for the development of Romania's economy, namely investments and infrastructure projects.
The business community is worried that the Executive will introduce additional taxes and fees for private businesses in order to secure the money needed to increase salaries in the public sector. Here is the president of the National Council of Small and Medium-Sized Enterprises Liviu Rogojinaru:
"As long as we don't know where the money comes from, as long as these salary increases are not based on a set of competence criteria, we are afraid that the Government, not knowing where to get the money from, will turn towards the private sector and will say: OK, let's levy some extra taxes and fees, because this is the only place that we can take money from without too much trouble."
There are trade union representatives who are not very happy with the new law either. The president of the Cartel Alfa Trade Union Confederation Bogdan Hossu has stated that the law will not solve, as it should, the salary gaps existing in the public sector, as there is no salary grid, for instance, for local public government employees.
The public salary law stipulates that over the coming five years, state employees' salaries will grow by more than 50% on average. State sector employees say that the law finally does them justice, all the more so as they were the first victims of the salary slashes operated in 2010, when the global economic crisis also spread to Romania.
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