Threat of job cuts in public administration averted
With preparations for a new state budget plan for 2008 underway, the government announced its intention to reduce the number of jobs in central and local public administration. However, trade unions complain of a staff deficit in certain areas and have threatened protest action. In the end, the threatened protest action did not go ahead, as the number of posts in public administration was increased in the draft budget plan.
Context
In 2007, some 1.1 million posts were funded by state and local budgets, representing a 13.3% increase compared with 2005. If all of these positions had been filled, they would comprise about 30% of all employees in Romania. The number of posts financed by local budgets reached approximately 700,000 posts in 2007, which is 10% higher than in 2005; about 400,000 posts were funded by the state this year, which is 19% more than in 2005.
Government proposals
The preparation of the budget draft plan for 2008 has raised the issue of salary expenses. At the beginning of August 2007, the Minister for Labour, Family and Equal Opportunities, Paul Păcuraru, announced that he would be proposing a 10% reduction in the number of posts in central and local public administration. The minister mentioned that a ceiling on the total wage fund could be envisaged in the 2008 budget. This may increase flexibility regarding the total number of employees, as workers may be tempted to avail of the compensatory payments in the case of layoffs.
Romania’s Prime Minister, Călin Popescu-Tăriceanu, recently asked Minister Păcuraru along with the Minister of Economy and Finance, Varujan Vosganian, to justify the proposal to reduce the number of posts.
Meanwhile, representatives from the International Monetary Fund (IMF) commented that the salary increase in public administration has been very high in the last 10 years.
Trade union reaction
The National Federation of Trade Unions from Administration (Federaţia Naţională a Sindicatelor din Administraţie, FNSA), which represents public civil servants and contract-based employees in local public administration, was the first to express its strong concerns about the ‘aberrant intention’ of Minister Păcuraru. The trade unions complained about the lack of respect for legal regulations, including Romania’s Constitution, in relation to decentralisation, local autonomy and the deconcentration of public services, which in turn generates the need for more staff. According to the unions, the proposal to reduce salaries is in breach of the labour law. They requested that the minister carefully analyse the public administration system together with the federations.
The FNSA statement was followed by an open letter issued by the National Trade Union Confederation Cartel Alfa (Confederaţia Naţionala Sindicală Cartel Alfa, Cartel Alfa), to which FNSA is affiliated. In the letter, Cartel Alfa expressed its dissatisfaction with ‘the lack of coherence of the social and fiscal measures promoted by government’. For instance, Minister Păcuraru announced that he would support a pensions’ increase, the introduction of compulsory private pension schemes and the reduction of social contributions.
At the same time, the decision to eliminate the compensatory payments for employees who become redundant has been questioned, as it is thought to be in breach of Council Directive 98/59/EC on the approximation of the laws of the Member States relating to collective redundancies.
The Managing Committee of the Confederation of Civil Servants’ Trade Unions ‘Sed Lex’ (Alianţa Naţională a Sindicatelor Bugetarilor Sed-Lex, Alianţa Sed Lex), which has 343 affiliated unions and represents employees working in the public administration sector, meanwhile declared that the Minister for Labour had used incorrect data in relation to the number of employees. Moreover, although reference was initially made to all personnel in public administration, Minister Păcuraru now only expressed concern about the situation regarding local public administration.
Threat of strike action
In early September 2007, FNSA threatened a number of measures if a decision to reduce the number of employees and salaries in local public administration was taken. The trade union confederation proposed the following measures: a so-called ‘Japanese strike’ – or silent demonstration – on 14 September, followed by a warning strike on 21 September, and eventually by a general strike on 2 October, at the same time requesting the dismissal of the government for its incompetence.
The government has not initiated its proposed restructuring plans. In fact, in the budget draft plan for 2008, the number of posts to be financed in public administration has increased. As a result, the trade unions abandoned their plans for protest action.
Commentary
Taking into account these tensions, a number of alternatives were proposed at government level, focusing mainly on the vacant positions – of which there are over 100,000 at present and which are blocking public administration funds. A redistribution of jobs between entities might be a constructive move, given that some institutions are experiencing a shortage of personnel and have important functions. Such institutions include the National Institute of Pensions and other Social Insurance Rights (Casa Naţională de Pensii şi alte Drepturi de Asigurări Sociale, CNPAS), the Labour Inspectorate (Inspecţia Muncii, IM), the National Environmental Safeguard (Garda Naţională de Mediu, GNM) and the National Agency of Fiscal Administration (Agenţia Naţională de Administrare Fiscală, ANAF).
Luminiţa Chivu, Institute of National Economy, Romanian Academy