The Romanian Senate passed on June 28 the bill aimed to regulate the so-called “special pensions”, namely those not financed from the public pay-as-you-go system, and make the system more financially sustainable and ethically fair.

The bill is a milestone under the national implementation of the European Union’s Resilience Facility (PNRR), relative to the third disbursement that the Government is preparing to ask the European Commission this autumn.

The bill was not backed by the opposition on the grounds that the provisions are so weak that even 20 years from now the special pensions will not be calculated based on recipients’ past contributions, and the retirement age for recipients will still be preferential.

On a more technical note, the budgetary impact of the special pensions on the budget – one of the targets inked in the PNRR – will not decrease significantly in the predictable future because the measures either have a marginal impact or are deferred for after 12 to 20 years. 

The bill prompted criticism from the magistrates (who see their benefits diminished, although gradually and not significantly), who are likely to refer it to the Constitutional Court. It also prompted criticism from the opposition, as the bill fails to enforce quickly fair principles for part of the “special pensions” recipients.

Prime Minister Marcel Ciolacu openly defended the “mild” impact of the bill, claiming that “otherwise key institutions such as the National Bank of Romania would stop functioning.” 

(Photo: Octav Ganea/ Inquam Photos)

iulian@romania-insider.com