Scandal Erupts in Coalition Over Pension Law

A government dispute regarding pension funds has arisen. Finance Minister Marcel Boloș reportedly hasn’t approved the new law that would increase Romanian pensions due to a lack of funds, according to political sources. He is said to have urged the Prime Minister to find solutions. A discussion took place on this matter within the National Liberal Party (PNL) on Thursday morning. PNL leader Nicolae Ciucă stated that it’s crucial to clarify the actual sum after last night’s Ministry of Labor information indicated a budgetary impact of 55.6 billion lei, significantly higher than the Finance Ministry’s calculations. “The impact is 3% of GDP, which is a substantial sum, and we need to identify funding sources,” Ciucă stated.

According to sources, Marcel Boloș agreed to provide his approval for this law, but with conditions; the indexing should be based on income growth and revenue collection for each year. The Finance Minister argues that fiscal reform is necessary to ensure there are sufficient funds in the budget to cover the increased pensions.

Liberal Party members discussed the new pension law on Thursday morning at their headquarters, as it must be approved by the government and sent to Parliament. This law has been the subject of discussions with the World Bank and representatives of the European Commission, as it’s one of the key elements in Romania’s National Recovery and Resilience Plan (PNRR).

PNL and PSD had promised a new pension law to bring more equity to how the funds are distributed. However, the first disagreements have already arisen, primarily from the Finance Ministry. Marcel Boloș may not agree with this law because it would have too significant a budgetary impact, which would be challenging to support next year when there are already multiple budget deficit targets to meet.

“A clarification is needed because last night there was information from Simona Bucura-Oprescu that the impact is 55.6 billion lei, but the Finance Ministry’s figures differ, which is why we requested clarification to determine the actual sum. It’s a significant impact that we need to assume with concrete data and ensure sustainability for this decision,” said Ciucă at the PNL headquarters.

He added that different figures are being circulated. “This is what we want to clarify, whether everyone understands that we’re discussing different figures and whether this reality of the figures is included in the law’s rationale at the Ministry of Labor level,” Ciucă explained when asked about the fact that the World Bank calculations show the 55.6 billion lei figure to be the impact after pension recalculation, but the impact for 2023 is 30 billion lei.

Regarding the Labor Minister’s promise of a total 40% increase in pensions after recalculation and indexing, the PNL leader mentioned that he doesn’t want to make unsupported financial promises to the electorate.

When asked whether there are currently no funds available to guarantee a total 40% pension increase, Ciucă responded, “It’s impossible with a sum of 55.6 billion.”

40% pension increasecoalitionfinance ministerGDPMarcel BolosNational Recovery and Resilience Plannicolae ciucapension lawpensionspnlpsdscandalWorld Bank
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