Romanian governors evade pension reform

Negocieri purtate de liderii primelor doua partide parlamentare, PSD si PNL, pentru formarea unui guvern, in Bucuresti, vineri, 19 noiembrie 2021. Inquam Photos / Ilona Andrei

Romania’s ministries of defence and internal affairs reportedly avoided endorsing the memorandum of inter-institutional collaboration aimed to „reduce spending on special pensions”, a milestone included in the National Recovery and Resilience Plan (PNRR). They returned the document drafted by the Ministry of Labour for setting grounds for inter-institutional cooperation unsigned, Profit.ro reported.

The memorandum envisages protocols among the Ministry of Labour, the National House of Public Pensions and the ministries and institutions whose staff are entitled to special pensions.

The so-called „military pensions” account for the largest part of the pensions paid from the central government budget to former state employees that do not contribute proportionally to the public pension system.

According to milestone 215 under PNRR, by the end of the fourth quarter of 2022, „necessary steps must be taken to complete the legislative framework for reducing spending on special pensions”. Separately, the Government must enforce a new pension law in the first half of next year – another mission that at this moment seems impossible due to the lack of agreement among the three ruling partners.

Within Component 8 of the PNRR, namely „Fiscal reform and the reform of the public pension system”, reform no. 6 refers to the „Reform of the public pension system”. This reform aims to meet the following milestones and targets: – Milestone 214: „Entry into force of the new law on the pension system” and Milestone 215: „Entry into force of the legislative framework for the reduction of special pension expenditures” (allowances and pensions established and paid based on special laws).

In order to fulfil these obligations, the Ministry of Labor and Social Solidarity promoted a Memorandum aimed at establishing the institutional premises necessary to meet milestone 215.

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