Gov’t passes budget plan; Parliament likely to sink it

Political strife aside, the budget plan still has some holes in it, as the central bank and the International Monetary Fund both expressed worries about inflationary pressures and the need to tighten wage and fiscal policies.
The budget draft allots the biggest share of funds to pensions and social assistance, which will draw in 11.9 percent of GDP, in excess of 30 percent more than the funding for this year. The growth will allow pensions to go from 416 RON in September 2007 to 580 RON in January 2008.
The boost does not affect the state budget negatively, as the money is coming from resources generated by rising incomes and economic growth, said Prime Minister Calin Popescu-Tariceanu when challenged with claims that the measure was purely populist.
Aside from focusing on pensions, the budget draft has education in its midst, as its funding was raised to 6 percent of the Gross Domestic Product (GDP), almost 30 percent more than this year. Funding for research also received a boost of 0.7 percent of the GDP, and so did health care, which will get about 4.5 percent of the GDP. Other priority directions for funding are infrastructure, rural development, regional development and innovation.

Ana-Maria David