Romania's government to settle urgent budget rectification at Friday cabinet meeting

Urgent funds before Friday's cabinet meeting

Prime Minister Luca Niculescu said on Thursday, 29 October, that the urgent budget rectification would be settled at the cabinet meeting on Friday, 30 October. He reached the decision after talks with PSD leader Sorin Grindeanu and Finance Minister Alexandru Nazare, and he made the announcement at an event in Bucharest for a new hospital built with European funds. That hospital is due to come under the management of the Marius Nasta institute, which hosted the event. Sources cited by Digi24 say the first package could cover urgent needs in health and public order, including unpaid salaries at the Ministry of Internal Affairs and overdue subsidies for farmers. Niculescu put the principle plainly:

“Neither medical staff nor Romanian patients should face difficulties in accessing care and treatment.”

Health needs and the cost of underfunding

Health Minister Alexandru Rogobete said on Monday, 26 October, that the health system needs between 10.5 and 11 billion lei to operate until the end of the year. Half of that sum is meant for programmes, medicines, pharmacy payments and other medical services, according to the minister, and the rest covers sick leave. Sources cited by Digi24 indicate Rogobete put the first emergencies at about 11 billion lei. In the week of 19 October, ambulance services and emergency units received an additional 150 million lei, which the minister said eased financial pressure on units. Niculescu rejected the idea that the money is a cost:

“The funds allocated to health, building hospitals, developing medical services and training health staff must not be considered expenses.”

He added that the social costs of underfunding include patients' suffering, a growing number of chronic patients, lives that cannot be saved and staff leaving the profession early. He also cited an OECD study published last year that puts per-capita health spending at about half the European average.

Where the money would come from

Sources cited by Digi24 say the money would not come from the state's reserve fund. Instead, it would be drawn from the 10% of each ministry's budget that was blocked at the start of the year, during Ilie Bolojan's government, for emergencies. Because those funds are not directly at the disposal of the Finance Ministry, moving them requires an emergency ordinance of the government. Sources cited by Gândul, as reported by Ziare.com, list ministry arrears running into tens of billions of lei, including 7 billion lei in electricity and gas compensation and 10 billion lei in ministry operating costs until year-end. The same list puts unpaid sick leave and magistrates' back pay at 5 billion lei each, PNRR project payments at 8 to 10 billion lei and VAT refunds to firms at 5 to 6 billion lei.

Energy and gas compensation7

Ministry operating costs10

Unpaid sick leave5

Magistrates' back pay5

Ministry of Development projects4.8

Pfizer litigation obligations4

Energy and gas compensation

7 billion lei

Ministry operating costs

10 billion lei

Unpaid sick leave

5 billion lei

Magistrates' back pay

5 billion lei

Ministry of Development projects

4.8 billion lei

Pfizer litigation obligations

4 billion lei

Data from the article text

Political friction over the figures

Political sources cited by Adevărul say the PSD leadership has calculated a gap of at least 35 billion lei, caused by unpaid invoices left by the Bolojan government. According to the same sources, Grindeanu asked Nazare not to present any rectification until he publishes the exact budget figures. Sources cited by Digi24 add that PSD accepted Nazare presenting a full assessment after the first rectification, at Grindeanu's request. PNL disputes the arrears estimates. PNL vice president Alexandru Muraru posted on Facebook accusing PSD of delaying the rectification and of letting the presidency and the premier stay silent:

“Practically the government is led from the PSD headquarters. Luca Niculescu and Nicușor Dan are mere spectators.”

What comes next

Sources cited by Digi24 say Finance Minister Alexandru Nazare is due to present the country's public finances on Friday, although the approval of the rectification on that day is not confirmed. The Finance Ministry reported a deficit of 78 billion lei for the first nine months of the year. Earlier in the week, Niculescu presented the government's priorities of financial discipline and economic recovery to central bank governor Mugur Isărescu. A second, broader rectification is expected in mid-November, and the government must also prepare the budget for next year.