27.5 C
August 15, 2022

Pensions’ Law – everybody is right

Once again, the Parliament has seen much unrest, this time over the Pensions’ Law. The Chamber of Deputies passed the Law on September 15, with 170 votes against 2, and 3 abstentions, in the absence of PSD and PNL legislators, who left the room before the vote. The Social-Democrat and Liberal opposition parties protested over the fact that the Law was passed without the quorum – i.e. the minimum number of deputies needed to validate a vote. And they were right, as video records proved that far less than 170 legislators attended the vote. The opposition accused House Speaker Roberta Anastase of committing a fraud. But the Speaker, too, is right when she says that nobody challenged the vote at the respective moment. It is true that opposition legislators were not present, except for a Liberal Deputy speaker. The heated debate led to accusations on both sides.

Eventually, bowing to the obvious, the Parliament submitted to vote on Tuesday a proposal to repeat the Pensions’ Law vote. As strange as this may seem, the MPs ruled – with 158 to just 33 – that the vote should not be repeated. As a consequence, the pension point stays at 39 pc of the average gross salary and the retirement age is raised to 65 for both men and women.

The idea behind Tuesday’s dispute was related to the sum allotted from the state budget for the pensions that will be paid in 2011 and the following years. The Law passed by Deputies last Wednesday sets the pension point (the index used for calculating pensions) at the same level as now, and gradually increases the age of retirement. In such conditions, PM Boc says the state should borrow no less than EUR 3 bln in 2010 alone, just to pay pensions. “In 2011, in the form adopted by the Parliament, we’ll need more than EUR 3 bln to pay pensions, as they are provided by the current Law. Had you opted for another variant (of the Law), we would have needed EUR 5 bln in 2011, resulting in a higher budget deficit.”

And he is right; the situation is far from reassuring, especially as each employee must sustain 1.5 pensioners.

On the other hand, the Opposition too is right. The September 15 vote was invalid. Before that, in 2008 (ahead legislative elections) the Parliament voted in unanimity (all political forces) in favour of raising the pension point to 45 pc of the average gross salary. Subsequently, they asked the government to keep increasing pensions as provided by the acting Law.

Also on Tuesday, President Traian Basescu came in Parliament to tell legislators that we must borrow EUR 5.7 bln in 2011 just to cover the budget deficit (of which EUR 3 bln for pensions). “Nobody wants to give us long-term loans,” Traian Basescu warned. And he is right. However, when he blames the situation either on the acting Cabinet, or the past one, led by Calin Popescu Tariceanu, he forgets that he was the president of the country during this whole interval, so it was him who sponsored the oscillating evolutions of the heads of government. It was him, as well, who insisted in 2008 that teachers’ salaries to be increased by 50 pc and said that the (evil) government of that time is the one that did not want to do it. Now, Traian Basescu pleads for moderation and realism when he asks political forces to change the way budgets are drafted and money is spent. Isn’t he rather late with this?

Summoned by the Parliament on Monday, to present the current state and evolutions of the Romanian economy, Premier Emil Boc used the opportunity to lash out at the former Liberal government led by ex-premier Calin Popescu Tariceanu. It is worth mentioning that, this time, it was Tariceanu who had the initiative to call the acting PM before the Legislative.

With too little to say in terms of achievements (as the loans from the IMF, WB, EC cannot be considered as such, even though the prime minister seems to believe so), Emil Boc focused his address on the negative performance of the previous Cabinet. He thus blamed the high deficit registered in 2008 on PNL, in the context of an economic growth by 8 pc, and said that former PM Calin Popescu Tariceanu is in no position to criticise the acting government. “Maybe it is up to someone to demand explanations for what is going on, but he is in no position to do it. Tariceanu has the pretext of asking us to pay the same salaries and pensions, but he forgets about the crisis,” Boc said. And he is right, at least partly. As the elections of autumn 2008 were getting near, the Liberal Cabinet made economic concessions to the benefit of the populist policies intensely promoted by the Social-Democrat and Democrat-Liberal opposition of the time. It spent money for its own political clientele, on bonuses, useless investments etc. The increase of pensions based on the average salary in the economy was such a hasty move, with repercussions in the present. The former Premier strongly rejected the accusations brought by Emil Boc. Tariceanu, too, is right. PM Boc delivered a politician’s speech. Tariceanu claims that the Boc Cabinet put to “good” use the money saved by the Liberal government, because Traian Basescu was re-elected president, salaries dropped and the VAT rose, as the Executive rules without a programme, he believes. Tariceanu said the government is “a small and orange vuvuzela” in the hands of Traian Basescu. In fact, nobody is leading Romania anymore, he accused.

All in all, perhaps the acting Cabinet’s “achievements” would be best described by a few blank sheets of paper, with the stinging humour specific to cartoonist Mihai Stanescu.

Even the former Finance minister Sebastian Vladescu – who was sacked during the latest Cabinet reshuffling – is right when he says that Premier Boc does not understand the economy very well. In his turn, the premier is right to criticise his former subaltern, for including various bonuses and the 13-th salary in the state budget, though he was well aware of the increasing economic problems, ever since the beginning of the year.

As one may notice, everybody is right. One way or another… This is also the source of the institutional, financial, legal and moral gridlock we are experiencing these years. It is impossible for everyone to be right and nobody to be wrong. Nobody takes responsibility and nobody is held accountable. Apparently, there are big gaps in the Romanian legislation. Such situations are unacceptable and generate the gridlock. Moreover, they perfectly define the Romanian irresponsibility. Until proven wrong.

Related posts

EY Romania study: 78% of Romanian Finance leads think they will be significantly involved in strategy development and executions over the next three years


Starcom Romania Study: Impact of the COVID-19 pandemic on women in Romania


Democracy’s vitality