The benchmark used for calculating individual pensions will increase by 14% as of September, under the budget revision draft published by the Ministry of Finance on August 14.

The Pension Law passed by the Social Democrats (now in opposition) last year provides a 40% increase.

The 14% increase will cost the budget RON 8.75 billion (EUR 1.8 bln, 0.8% of GDP) this year, Ziarul Financiar reported. 

The draft budget correction also shows that the budget deficit is projected to increase from 6.7% of GDP (the initial estimate) to 8.6% of GDP.

In the first draft budget for 2020, the Ministry of Finance estimated a budget deficit of 3.6% of GDP. Thus, the new deficit forecast is five percentage points of GDP above what was estimated in the draft budget for 2020.

editor@romania-insider.com

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