Gov’t approves state budget for 2019

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The Government has approved on Friday the state budget for 2019.

The draft bill was not on the cabinet sitting scheduled for 12.00h, but Prime Minister Viorica Dancila announced it would be introduced on the additional list.

In the past week, the budget allocations have stirred much debate, with the mayors arguing they will have no development funds and UDMR requesting money for local administrations. Sources say ALDE also had objections to the draft bill during the negotiations conducted with PSD leader Liviu Dragnea.

PM Dancila said, before the sitting on Friday, that the draft bill has been intensely debated by all parties and its main pillars are health, education and public investments.

“We have also considered budget allocations to honour our obligations to foreign partners, such as the 2% of the GDP for Defence, in compliance with the commitments made by Romania with its NATO allies and the amounts for Romania’s presidency of the Council of the European Union,” Dancila said.

During the Government sitting were approved also the draft bill on the social security budget for 2019, the draft bill on capping certain indices within the fiscal-budgetary framework for 2019 and the Fiscal-budgetary strategy for 2019-2021.

PM Dancila said the Ministry for European Funds has a record budget of RON 2.3 billion. For the first time the GDP will exceed RON 1,000 and the budget deficit will be 2.55% of the GDP.

Main provisions of the state budget, according to PM Dancila:

  • The funding of wage and pension increases in the public system, the payment of social indemnities and support for economic stimulation policies;
  • Increase of the pension point by 15% as of September 1, 2019, from RON 1,100 to RON 1.265 and of the minimum pension by 10%, from RON 640 to RON 704;
  • Increase of the monthly guaranteed minimum wage to RON 2,080, to RON 2,350 for persons with higher education and at least one year experience, to RON 3,000 for people employed with companies operating 80% in the construction field;
  • Funding for health system will be by RON 6.1 billion higher than last year; Health Ministry will acquire this year 1,000 incubators;
  • Education will received by 48% more than last year, up to RON 30.8 billion;
  • 2019 will be the year of investments, 4.86% of the GDP, up by 45% against 2018 to RON 49.65 billion;
  • Transport Ministry will get funding by RON 6 billion higher, i.e. by 74.4% more than in 2018
  • Local budgets will have record allocations with total amounts from the state of RON 47.9 billion, i.e. 61.4% of the overall local budgets;
  • The collected income tax by the state budget will be 100% directed to the local budgets, i.e. RON 22.2 billion.

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