RO opposition preses Govt. to come up with 2021 budget planning

Romania's opposition Social Democratic Party (PSD) urges the Liberal Government to present a draft budget planning for 2021 and accuses it of planning tax hikes to be disclosed after the general elections on December 6.

PSD MP Oana Florea accused finance minister Florin Citu of hiding pension and wage cuts planned for next year, as well as an imminent agreement with the International Monetary Fund (IMF).

"Just like (former) president Traian Basescu and his prime minister Emil Boc, president Klaus Iohannis and finance minister Citu want an agreement with the IMF because they are not able to come up with a plan for economic recovery," Florea accused, quoted by Mediafax.

Citu has repeatedly denied such plans for an arrangement with the Fund, claiming that this year's public deficit is already financed, and next year's financing needs can also be covered without any tax hike. He assured most recently on October 27 that no tax hikes are in sight for the next year.

Citu also promised to disclose the National Liberal Party's "vision" of the fiscal policy to be pursued in the years up to 2023 - implying that this "vision" would be unveiled before the elections.

The wide public deficit this year (likely over 8% of GDP) and the uncertain recovery amid still unclear health outlook support some concerns related to Romania's public finance.

The rating agencies are expecting the new Government after elections to outline a clear and credible fiscal policy.

However, such a credible plan does not necessarily require sharp fiscal consolidation starting as of 2021 - but rather a credible strategy and steps toward pursuing it.

The centralization of the public institutions' IT systems into a sole Government's cloud system is such a step likely to yield tangible benefits in terms of higher budget revenues and lower expenditures.

(Photo: Oana Florea Facebook Page)