Romania's Bolojan pushes salary restructuring law to parliament despite street protests, Brussels demands compensatory measures
Romania's caretaker Prime Minister Ilie Bolojan announced on July 21 he would submit a public-sector salary restructuring law to parliament next week despite ongoing street protests; the new pay grid freezes salaries of higher-paid public workers until lower-paid colleagues catch up; Brussels is demanding 12.1 billion lei in compensatory measures to offset the fiscal cost
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Summary
Romania's caretaker Prime Minister Ilie Bolojan announced on July 21 he would submit a public-sector salary restructuring bill to parliament next week, calling MPs back from their summer recess for a vote. The law creates a new pay grid that freezes wages for public workers currently above the grid until lower-paid colleagues reach the same level. A provision raising elected officials' pay added political friction and drew specific criticism from protesters. The European Commission has asked for 12.1 billion Romanian lei in compensatory measures to offset the law's net fiscal cost before signing off on Romania's EU fiscal consolidation plan.
Why it matters
Romania has been under EU excessive-deficit proceedings and the Brussels demand for compensatory measures signals the Commission is treating the salary reform as a partial fiscal loosening that needs offsetting. Bolojan is caretaker PM, which limits his political capital, and the combination of pay cuts for some workers alongside higher dignitary pay makes the bill politically volatile ahead of elections.
What to watch
Whether parliament votes the law through in the recalled session; whether the EU accepts or rejects the compensatory measures Romania proposes; and whether protests escalate beyond Bucharest.