Romania's Chamber of Deputies adopted on Tuesday, October 14, as the decision-making chamber, a bill that increases the benchmark used for calculating social benefits, such as unemployment benefit, from RON 500 to RON 1,200 in three years, G4media.ro reported.

The Parliament sent the law to president Klaus Iohannis for promulgation.

According to the report adopted by the Labor Commission, the increase will be gradual over the next three years: to RON 780 in January 2021, RON 990 in January 2022, and RON 1,200 in January 2023.

Afterward, the benchmark will be indexed with the inflation rate.

The law's initiator calculated the budgetary impact in a single year at RON 10.4 bln (EUR 2.14 bln) annually or 0.99% of GDP (2019).

The Government estimated an annual budgetary impact of RON 856 million (EUR 176 mln) per month.

Given that the Parliament voted for a staged increase, the budgetary impact would be about 0.4% of GDP in the first year (2021), according to the bill's initiator, MP Adrian Dohotaru.

The Government issued a negative opinion on the bill, saying that the initiators did not provide the financing source to increase social benefits.

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andrei@romania-insider.com