BUCHAREST, Romania — Romania plans to cut over 53,000 public jobs as part of a package of austerity measures aimed at reining in the budget deficit, officials said on Thursday.
Prime Minister Emil Boc has long criticized various public institutions, which he said are oversized and inefficient. The number of government employees performing similar jobs varies widely between similar sized communities, he said as the government adopted an emergency ordinance to regulate the number of people employed by local institutions.
The cuts are the latest in a series of austerity measures announced by the government, which is struggling to cope with a budget deficit exacerbated by the global recession. On Thursday, the sales tax jumped from 19 percent to 24 percent and new taxes were introduced for people who own more than one property.
All public sector wages were also reduced 25 percent starting July 1.
A 25 percent cut in wages and the increase in VAT came into practice a day before the International Monetary Fund meets to conduct the fourth review of Romania’s loan of euro20 billion ($24.65 billion) from the IMF, the World bank and the EU. The IMF board will decide whether to disburse an installment of about euro900 million ($1.1 billion).
IMF mission chief Jeffrey Franks said earlier this year Romanian authorities must gradually reduce the number of public workers, which grew by 250,000 people in the boom period of 2006-2008 to about 1.4 million.
Romania has about 5.5 million retirees and only about 4.3 million employees – from which about 1.36 million are public sector workers, out of a population of about 21 million.
Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Romania to cut 53,000 government jobs

BUCHAREST, Romania — Romania plans to cut over 53,000 public jobs as part of a package of austerity measures aimed at reining in the budget deficit, officials said on Thursday.
Prime Minister Emil Boc has long criticized various public institutions, which he said are oversized and inefficient. The number of government employees performing similar jobs varies widely between similar sized communities, he said as the government adopted an emergency ordinance to regulate the number of people employed by local institutions.
The cuts are the latest in a series of austerity measures announced by the government, which is struggling to cope with a budget deficit exacerbated by the global recession. On Thursday, the sales tax jumped from 19 percent to 24 percent and new taxes were introduced for people who own more than one property.
All public sector wages were also reduced 25 percent starting July 1.
A 25 percent cut in wages and the increase in VAT came into practice a day before the International Monetary Fund meets to conduct the fourth review of Romania’s loan of euro20 billion ($24.65 billion) from the IMF, the World bank and the EU. The IMF board will decide whether to disburse an installment of about euro900 million ($1.1 billion).
IMF mission chief Jeffrey Franks said earlier this year Romanian authorities must gradually reduce the number of public workers, which grew by 250,000 people in the boom period of 2006-2008 to about 1.4 million.
Romania has about 5.5 million retirees and only about 4.3 million employees – from which about 1.36 million are public sector workers, out of a population of about 21 million.
Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Read the article on Forbes

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