Tensions among RO ruling coalition members depress fiscal consolidation hopes

The public deficit target set for this year will be revised upward in nominal terms by RON 2.5 bln, from RON 80 bln, prime minister Florin Citu announced after a new round of negotiations among the ruling coalition’s members.

The deficit to GDP ratio will, however, decrease as a result of larger GDP (pushed up by brighter recovery outlook and faster inflation as well), he added.

While Liberal leader Ludovic Orban announced that “it was agreed upon a budget draft to be backed by the Liberal party (PNL),” prime minister Citu assured that “there will be amendments”.

“It’s not in the ruling coalition where the resources are allocated,” PM Citu stated.

While the two Liberal leaders are fighting their electoral battle, the junior ruling parties are asking for more funds - apparently unsuccessfully, Hotnews.ro reported.

The development ministry headed by Cseke Attila (UDMR) asked for RON 4 bln more for the local development schemes PNDL. PM Citu reportedly said that RON 1.8 bln is all he can give. The transport minister Catalin Drula (USR PLUS) keeps asking for RON 3 bln more for motorways -while PM Citu says Drula’s ministry spent proportionally less compared to other parties in H1. Surprisingly, PM Citu and PNL leader Orban agreed that Drula’s ministry does not need more money.

The RON 3 bln to be allocated to local administrations through the prime minister’s reserve fund also stirred controversies because of the alleged discretionary (potentially politically biased) procedures used.

(Photo: George Calin/ Inquam Photos)