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Net public sector wage raise cost: 1.4 billion euros

Autor: Adelina Mihai

26.11.2010, 00:15 14

In order for net salaries to increase by 15%, another 100,000public sector employees should be made redundant, calculationsshow.

Will a state employee with a net salary of 1,000 RON at presentcollect a 1,150-RON net salary, 15% higher, as of January nextyear? Sources from the Finance ministry say yes, but ValentinMocanu, secretary of state within the Labour Ministry says theincrease refers to gross salaries.

However, other sources from the Finance Ministry say the stateneeds an additional 1.4 billion euros to boost the net salaries ofpublic sector employees, and it is very difficult to establishwhere this extra money will come from.

"We don't have information about the sources of funding forboosting net salaries by 15%," says Ionut Dumitru, chairman of theFiscal Council.

Dumitru Costin, leader of the National Trade Union Bloc, saysthis wage increase by 15% is already accepted by IMF experts andincluded in next year's budget, being based on macroeconomicprojections put together by experts.

For next year, the Government has allocated a budget of around9.3 billion euros (39 billion RON) for state employee salaries,with state institutions set to be left with 1.29 million employees,26,000 fewer than at the end of September.

Sources close to the Finance Ministry say this 15% increasewould only be possible by significantly raising the number ofredundancies in 2011 from the 15,000 announced.

Amid an average net salary of 500 euros of a public sectorworker, the state's overall costs amount to 1,000 euros, so for 1.4billion euros in savings to be made in order to allow salaries toincrease by 15%, another 115,000 public sector workers earning theaverage wage would have to be made redundant.

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