State employee wages might return to level before 25 pc cut next year

Starting next year, state employee salaries might gradually go back to the level prior to the 25 per cent cut, Economy Minister Adriean Videanu says. “In 2011, the premises will be created for salaries to gradually return to the level prior to the 25 per cent cut,” Videanu stated. As of July 1, public employee salaries have been slashed by 25 per cent, in a bid by government to cut budgetary spending to stay within the budget deficit target of 6.8 per cent agreed with the International Monetary Fund (IMF).

Finance Minister Sebastian Vladescu Monday said the salary fund set for next year, correlated with 60,000 public sector jobs being cut, will allow for a pay increase of over 10 per cent whose distribution, based on the blanket system, is yet to be established.

In negotiations with the IMF, government pledged to curb the number of public sector jobs to 1.29 M by early next year, which will result in 70,000 state employee jobs being axed and a salary fund of RON 39 bln in 2011.

Videanu also said that for now a further IMF loan is out of question, ‘Gandul’ informs. Vladescu announced on Monday that the Executive does not hold a new agreement with the IMF necessary, yet, it would not rule out that alternative either, the need for it going to be examined later this year. “In my view, the need for a new agreement will likely be somewhat looked into at the end of the year, yet it will become a topic for discussion next year most likely, when we learn more exactly the macro economic parameters for 2011, when we know how things effectively evolved in 2010. We don’t take a fresh agreement into account, but we don’t rule it out either,” Vladescu stated.

Mediafax reports IMF delegates as calling on government to make sure the blanket pension law will go through Parliament by September 15, although the Executive insisted the deadline should be pushed back to September 30 at the soonest, given MPs only return from holiday early next month.

Nine O'Clock