Prime Minister Ilie Bolojan presented, on Friday, in a press conference, the main measures taken in the 100 days since taking office as prime minister.
Ilie Bolojan has been leading the Government since July 23 when he took the oath in front of the president at the Cotroceni Palace.
The Prime Minister stated that he took the necessary and absolutely essential measures to regain Romania's financial credibility.
At the same time, Bolojan says, the Government avoided insolvency, amid deficits of 9% and overspending of over 30 billion euros. "It was a first step towards regaining trust in Romania," the Prime Minister said.
Ilie Bolojan also spoke about what needs to be done in the next 100 days. According to the Prime Minister, there are two constants that no government can avoid: collecting revenues and limiting, reducing operating expenses.
"Only in this way will we have balanced budgets and be able to finance investments. It's no use raising taxes if the collected money doesn't enter the state budget," says Bolojan.
The Prime Minister says that it is necessary "to complete the digitalization of the National Agency for Fiscal Administration (ANAF) and Customs, to firmly combat tax evasion, to ensure that transfer payments allow for serious tax payments in Romania, and to combat undeclared work."
Regarding the reform of local administration, Bolojan states that it is a necessity and an urgency: "It needs to be more efficient because we can no longer support the positions we currently have. Reducing positions is a necessity, and I hope this will be put into practice in the near future."
Additionally, Ilie Bolojan believes that it is necessary to ensure energy security and explained that there is a production deficit in Romania. To address this, work on hydroelectric power plants, which are in an advanced state, and thermal power plants, where work is lagging, must be completed.
Spotmedia presented, in LIVE TEXT format, the most important statements of Prime Minister Ilie Bolojan
- One hundred days have passed since this government took the oath. We took on this responsibility against the backdrop of a budget crisis. We took the necessary and absolutely essential measures to regain Romania's financial credibility. Rating agencies have confirmed that we have done what is necessary, and it was a first step towards regaining trust in Romania and regaining the trust of our citizens by telling them the truth.
- We avoided insolvency, amid deficits of 9% and overspending of over 30 billion euros. It was a first step towards regaining trust in Romania.
- I hope the measures in Package 2 will be validated by the Constitutional Court. It was not austerity but measures of responsibility.
- We had to limit and reduce public spending, and the measures adopted to cap salaries and reduce bonuses were an absolutely necessary first step that must be continued.
- We reorganized investments to be able to continue and stay within financial limits. We had significant overcommitments in all areas. Through the measures adopted, these investments are largely continued.
- We renegotiated the PNRR program, where we were in a deadlock, we renegotiated the milestones to avoid losing funding.
- We negotiated a significant amount in the SAFE program for Romania to be able to cover defense expenses, as well as finance important infrastructure investments such as the highway sections in Moldova.
- We prepared the local administration reform package that we have not managed to finalize, but it needs to be done to have an administration that includes decentralization and simplification. However, reducing expenses is a chapter that cannot be excluded from the reform. They are in very advanced stages, and we can no longer afford to remain in this situation.
- What we need to do in the next 100 days. There are two constants that no government can avoid: collecting revenues and limiting, reducing operating expenses. Only in this way will we have balanced budgets and be able to finance investments. Raising taxes is useless if the collected money does not enter the state budget.
- We need to complete the digitalization of the National Agency for Fiscal Administration (ANAF) and Customs, firmly combat tax evasion, ensure that transfer payments allow for serious tax payments in Romania, and combat undeclared work.
- It is necessary to keep public spending under control and reduce it. Therefore, reforming local administration is a necessity and an urgency. It needs to be more efficient because we can no longer support the positions we currently have. Reducing positions is a necessity, and I hope this will be put into practice in the near future.
- To have a responsible administration, the amounts from transfers must be directly proportional to the degree of collection of local taxes. Merging and consolidating decentralized authorities, agencies, and services is necessary.
- Prohibiting the cumulation of pension with salary is an important element that needs to be implemented. We are about to find the constitutional formula to put it into practice.
- We need to ensure energy security. We have a production deficit in Romania, and for this, we need to complete the hydroelectric plants that are in an advanced state and the thermal power plants where work is lagging. Work began in Iernut in 2016. If we do not correct what is happening there, we cannot expect to finish in 2026, ten years after we started.
- Supporting nuclear projects, especially the area near Cernavodă, and accelerating the work. We need an energy mix in the coming years that ensures competitive energy in Romania.
- The coal strategy is something we need to close in the immediate future. Because we have not respected the decarbonization milestone, we have two options: either maintain production in the Jiu Valley but that means a total restructuring of CE Oltenia to prevent it from being parasitized, or give up coal production. I support the first option, but we cannot continue as we are today.
- We have many areas where we import some products. In the pharmaceutical sector, over 95% is important. In some sectors such as animal feed or chocolate, we have very few local producers. We need to directly contact major producers and offer support for relocating production to our country.
- An important issue is discouraging unjustified granting of sick leave, with an annual cost of over one billion euros. I am not referring to those with valid reasons for sick leave, but to holiday bridges. Any form of unjustified sick leave must be stopped.
Questions:
When will Package 3 be adopted?
- If there was only one party, certain decisions would be made more quickly. Perhaps we could have done more if we were more coherent and supportive among ourselves. As for the administration, things are resolved. Next week we will have a final decision, and the sooner other aspects related to central administration and the other points I presented are clarified, I believe a Package 3 can be adopted as soon as possible this month. The sooner it is adopted, the better.
Will we see in Package 3 the ban on combining pension and salary in the public sector and the reduction of early retirement?
- Yes
Where is the fairness when you cut funds from mothers, pensioners, and students and borrow for the military?
- You cannot have free services if the system is not funded. With 6.3 million contributors and 16 million beneficiaries, the system cannot function. Trying to overlay these measures on defending the country and ensuring a secure border in Eastern Europe has a cost. This formula, through which we can benefit from a credit designed by the EU with interest rates five times lower than the market, repayable over 40 years, would have been a mistake not to access. Mixing up the data has nothing to do with reality, but with ideological approaches.
The US State Department report shows an overwhelming perception of widespread corruption. What measures do you have in mind?
- Evidently, if we have only partially collected taxes and duties, if we have tax evasion sometimes on a large scale, this can only be done by people who tolerate these things within the system. So with people who, in one form or another, directly or indirectly, are involved in various corruption schemes. And any measure leading to simplification, digitization, will systemically reduce these possibilities. And where administrative measures have no effect, the prosecutors and institutions competent to hunt down such people must do their duty, and I will support them. Corruption is still a social cost that does not help us, we should not be told by someone else, but we should find it ourselves every day, and sometimes Romanians find it. But this is an action that must be carried out systematically on several levels, and each authority responsible in a field must do its duty.
How much will subsidies to parties be reduced?
- Subsidies are established through the budget, when the budget comes, they will be set for next year. For this year, we will have another adjustment and maybe we can reach a consensus that in the last month, for example, subsidies will no longer be granted, which means a 10% reduction. I believe that political parties in Romania can function with lower subsidies from the state budget; I support this approach. When you are in a period of restrictions, cost reductions, everyone, including political parties, parliamentarians, and all those who have behaved in a certain way, have had certain normal amounts in previous years, they must be part of this effort, and I am convinced that a solution will be reached to come up with an additional correction compared to what has been done so far.