ECONOMY FINANCE&BANKING

Gov’t approves 2019 State Budget Bill and Social Security Budget Bill

The government approved at Friday’s sitting the 2019 State Budget Bill and the 2019 Social Security Budget Bill, with the acts to be next referred to Parliament on the same day, Minister of Public Finance Eugen Teodorovici told a press conference at the Victoria Palace of Government.

“I am pleased to tell you that today the government of Romania approved the 2019 Budget Bill and, of course, the social security budget,” Teodorovici said, emphasizing also that the final version of the acts slightly differs from the version released on the website of the Ministry of Public Finance a few days ago, as a result of the debates held in the Economic and Social Council, of the opinion received from the Fiscal Council and the discussions with the four associative bodies.

“As a result of all these talks, several changes were operated in the government and you will see the final text we will post today for everybody to see what the final version of the draft budget the government is sending to Parliament today looks like. Next week, of course, we will set the timetable for the draft budget to be debated and then referred to the Parliament plenary,” said the Finance Minister.

Teodorovici reiterated that the draft budget is built on an economic growth of 5.5 pct, which means a Gross Domestic Product worth 1,022.5 billion, a gross average wage of 5,163 lei, and a number of 5,282 employees in the economy.

“In the first three years of governing of the current parliamentary majority, the GDP will grow by more than 33 pct to 1,022 billion lei, it’s the moment when Romania virtually tops the 1,000-bln lei threshold, which is extremely important and clearly shows that the economic measures set in place by the current government have produced the expected effect,” Teodorovici said.

The FinMin cautioned that the budget deficit set at 2.55 pct of GDP can be maintained only by the joint effort of the governing team.

“A particularly noteworthy aspect, this year’s budget deficit is set at 2.55 pct, as per the limits set forth in the Maastricht Treaty; the deficit can be maintained at the level proposed by the government, based on the analysis conducted by the Ministry of Public Finance, but this requires joint effort not only from the Ministry of Public Finance, but from the entire governing team, in order to cover four areas of reform and effectively direct the money exactly to the areas that need it,” Eugen Teodorovici explained.

 

FinMin Teodorovici: This year’s pension budget is on surplus of 0.2% of GDP

 

This year’s pension budget is on a surplus of 0.2% of GDP, indicating that Pillar I (mandatory state pension fund, ed. n.) may be taken to an area where it can become very attractive, Minister of Public Finance, Eugen Teodorovici told a Friday’s press conference held at Victoria Palace.

 

“This year’s pension budget is on a surplus, mainly as a result of a measure adopted in the past years, namely the transfer of contributions from the employer to the employee, and that today we can say that we have a plus of 0.2% of GDP, an important element. The measure of the transfer of contributions was, as I said, the measure that had the decisive effect in this change of situation, from a deficit in the past years to 18 billion lei today, We also said last year that the Pension I Pillar can even be taken to an area that we all want, and especially those who are going to retire, from which to make investments so that they become very much attractive,” Teodorovici said.

According to the data presented by the finance minister, the pension budget deficit was 1.95 of GDP in 2016, in 2017 by 1.6% of GDP, in 2018 by 0.5% of GDP, while for the year the pension budget has a surplus of 0.2% of GDP.

 

ANAF must collect in 2019 to budget 30% of GDP

 

The National Agency for Fiscal Administration (ANAF) has the obligation to bring 30% of GDP to the state budget this year, which means it will have a lot of work, Minister of Public Finance, Eugen Teodorovici announced on Friday at Victoria Palace.

“The budget revenues estimated for this year are 342.7 billion lei, by 53.1% higher than 2016. In order to ensure the budget revenues, we are considering an improvement in the way ANAF collects. This increase will be 6 billion lei. I would like to make a very important clarification for my colleagues in the system. ANAF’s level of income in GDP is calculated somewhere at 28%. It is an important increase compared to last year, but I want to say very clearly that the level that ANAF has to bring this year is 30%. The revenues taken into account in the drafting of the budget are up to 28% of GDP but 30% is ANAF’s obligation for this year,” Teodorovici said at a press conference, after the Government approved the draft 2019 State Budget Law.

He stressed that ANAF would have all his support, but he warned that he would not renounce any measure “to ensure what we said today.”

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