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October 22, 2021
BUSINESS

Gov’t terminates the Infrastructure Development Programme

The money saved from restricting such programmes will be used to co-finance European projects.

The government decided to terminate the National Infrastructure Development Programme (PNDI) and will cancel the financing granted to the projects included in this programme for this year and in the future, Premier Victor Ponta announced in the TV show ‘20 Years After’ on Pro TV. “In each ministry and authority, we began terminating these dubious contracts. We completely stopped the famous PNDI, we totally cut its financing for this year and for the future too. This year, it was about RON 1 bln,” Ponta said. According to the PM, the money saved by stopping such programmes will be used to co-finance European projects, as the real situation of Romania’s absorption capacity is “much worse” than the optimism displayed so far. The programmes currently financed through PNDI will end in June, following negotiations with the IMF, and the Ministry of Regional Development and Tourism will propose starting July, for this programme, projects like the thermal rehabilitation of dwellings or the restoration of old town centers, Minister Eduard Helvig recently announced. Meanwhile, the premier hopes that the 1.5 pc growth target for this year remains realistic, admitting that even this figure is too small for the repayment of Romania’s debts. It is hard to believe that the “golden era” of past years will return, he warned.

Expenses from Reserve Fund get cut as well

Enforcing differentiated salary tax quotas, lowering the CAS paid by employers and instating a different VAT on agri-food products will have a negative impact on the state budget, which will be covered by cutting other expenses, also those from the Reserve Fund, PM Ponta announced. “By January 1, 2013 we want to enforce a three-step tax system: 16 pc for companies and medium-income individuals, while for those with very low incomes we will try to enact the two other quotas, of 12 pc and 8 pc. It will be – if you like – a social quota with a negative impact on the budget. But there will also be measures with positive impact for the budget. First, we will end, once and for all, the practice of using the Reserve Fund of the Government to finance various actions. We will not terminate it, but it will be used only for emergency situations, as provided by law, and not for financing own mayors and county council president every two months,” Ponta stated. As for social contributions, the premier explained that his government wants to lower by 5 pc the CAS paid by employers next year.

New level of royalties, starting June

By the end of June, the government will announce a new level of royalties paid by the energy sector, because Romania only earns 4 pc, while the average figure at EU level is above 20 pc. According to Ponta, the new level of royalties, which will be enforced subsequently, will be announced before the end of the current session of the Parliament. In a different move, the PM announced that the project of constructing reactors 3 and 4 of the Cernavoda NPP must go on. Although he personally cares very much about the position of environment NGOs, the energy independence of the country is essential, PM Ponta added.

Plans for Cupru Min

The new Executive analyses the possibility of transferring Cupru Min shares to the Alba County Council, which will attract from the European Union funds for environment investments in the company. Asked whether the decision will be made this year, the premier answered: “Absolutely yes.” The government also has strategies regarding the latest evolutions of the national currency’s exchange rate, as PM Ponta believes that the RON/EUR rate can be kept under control and the fluctuation will not have major influences for financial markets, according to talks he had with Central Bank Governor Mugur Isarescu.

Liviu Voinea, state secretary with the Ministry of Finance

Economy expert Liviu Voinea, who collaborates in drafting the economic programme of the new government, will be appointed as state secretary with the Ministry of Finance. Previously, rumors gave him as Minister of Finance in the Ponta Cabinet. On the other hand, the new president of the National Agency for Fiscal Administration (ANAF), appointed by the former Ungureanu government, will be kept in place if he meets the performance criteria, Ponta said.

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