Bucharest.

Cutting 25 percent off the public wages pool will not generate the savings Romania needs right now, and that is why cutting individual wages by 25 percent is needed, Finance Minister Sebastian Vladescu told a televised show, Romanian Agerpres news agency reports.

Cutting 25 percent off the public wages pool would fail to generate the savings we need now. We need savings of nearly 20 percent of the net wages pool. Such savings would require 25 percent of the gross wages pool, or else we lose revenues from the social security contributions attached to the pay cuts. Currently, there is no cut available that would mix staff cut with pay cuts because staff cuts now will not translate in savings. Under the current legislation, staff cuts entail diminishing wage spending, a rise in unemployment spending and a drop in social security revenues. We could consider a 40-percent staff cut, but that would be impossible as it would make many systems dysfunctional,’ Vladescu explained.

Read the article on Focus Information Agency (Bulgaria)

Romania: Cutting 25% off public wages pool will not generate needed savings, says minister

Bucharest.

Cutting 25 percent off the public wages pool will not generate the savings Romania needs right now, and that is why cutting individual wages by 25 percent is needed, Finance Minister Sebastian Vladescu told a televised show, Romanian Agerpres news agency reports.

Cutting 25 percent off the public wages pool would fail to generate the savings we need now. We need savings of nearly 20 percent of the net wages pool. Such savings would require 25 percent of the gross wages pool, or else we lose revenues from the social security contributions attached to the pay cuts. Currently, there is no cut available that would mix staff cut with pay cuts because staff cuts now will not translate in savings. Under the current legislation, staff cuts entail diminishing wage spending, a rise in unemployment spending and a drop in social security revenues. We could consider a 40-percent staff cut, but that would be impossible as it would make many systems dysfunctional,’ Vladescu explained.

Read the article on Focus Information Agency (Bulgaria)

Postat de pe data de 19 mai, 2010 in categoria România în lume. Poti urmari comentariile acestui articol prin RSS 2.0. Acest articol a fost vizualizat de 103 ori.

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