Fresh News

Friday, 15 February

Speech by Prime Minister Viorica Dăncilă at the final vote on the drafts of the 2019 state budget law and the 2019 state social security budget in the joint session of the Chamber of Deputies and the Senate

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Dear President of the Romanian Senate,

Dear Speaker of the Chamber of Deputies,

Dear MPs,

Dear colleagues,

 

First, I want to thank you for your activity throughout the week, and the efforts you have made until late at night to debate the budget for this year.

Passing the budget is for both the Government and the Parliament the moment in which the main lines of action, priorities are established and it is to an equal extent the moment in which we convey this time to citizens, under the form of figures, not of political discourse what is happening in 2019.

It is a moment of truth for the Government I am leading and especially for me, the moment in which we can let the political statements totally outside this hall, and relying on figures and projects included in the draft budget, we can tell what 2019 will bring in the life of every citizen.

The budget reflects the current economic and social realities in Romania and also the political conception and the political programme of the Coalition that very clearly won the parliamentary elections in 2016.

The construction of the budget for 2019 is based on the fact that, following these years of uninterrupted economic growth, we have a bigger GDP, a bigger budget, and a decreasing public debt. At the same time, like any budget here or elsewhere, in the world, it cannot meet everybody’s expectations, it is a realist budget, and with development prospects for Romania.

First of all, as I have said it before, 2019 will be an year of investment. After two years of consistent increases of pensions and salaries, the most important preoccupation of the citizens is naturally with investment in transport infrastructure, in healthcare, kindergartens, schools, in agriculture and of course, in local development projects. Therefore, we took into account the voice of the citizens and we drew up a budget to meet these expectations.

We supplemented the investment budget by 15.7 billion lei compared to last year, 6 billion of which directly add to transport infrastructure budget. This year, we want to accelerate the works for express roads and motorways.

We will continue to complete the link segments on the Transylvania highways, but this year, we will kick off express road and motorway projects in both Moldova and the southern area of the country, in order to reduce development gaps. It is absolutely necessary to connect the western border with the Black Sea to put Romania on the map of the major trade routes to central and western Europe. But at the same time, it is necessary to bridge the development gaps in Moldova and the southern area of the country, because all Romanian citizens deserve a decent living.

Other good news is that this year, the European programmes will advance at full speed. We recovered the 2016 delays, we reached the European average as regards the rate of absoption and in 2019, many projects have already reached maturity, bringing more money for investment, in our country. All this European money is directed towards Romania’s development, the development of local communities and will contribute to the increase in the living standards of the Romanian citizens. We will fight for this European money because, as I said at the meetings with the EU representatives, Romania wants to be a state fully integrated in Europe, but at the same time, we want equal treatment for Romania. Equal treatment means including our country’s access to the EU’s development funds. We already have a good expertise in this financial exercise gained in previous years, everybody got familiar with these mechanisms, therefore, we have all we need to go beyond EU average as regards the absorption rate. This is one of the major objectives that I set as Prime Minister for this year.

 

Dear colleagues,

For this year, we prepared several governmental programmes to support the business sector, with special emphasis on Romanian companies and products. We want the development of the Romanian capital as this suffered in previous years, and we are going to strongly support it. We will equally continue to support and encourage new foreign investment, the Public Private Partnership law, creating huge opportunities in this respect.

In this field, we will have several governmental programmes: the Programme „ State aid to finance the investment projects”, Programme to support the SMEs – IMM Invest Romania, Setting up the Programme to finance investment for upgrading and developing spa towns, State aid scheme on backing film industry and other such measures to develop the Romanian capital.

Other important direction of investment is the national defence industry, where Romania has a huge potential. We are suppliers of components for many of the NATO partners, and I think that Romania has the opportunity to regain its position in this field by reinvigorating the profile industry.

We are already in the third year in which Romania observes its commitment to NATO partners and allocates 2 percent from GDP for Defence, money to be found of course in the investment for the defence industry development.

All in all, if we take into account also the increase in the EU funds aborption rate, Romania will benefit this year of overall investment of 50 billion lei – over 13 billion euros – which will give a strong impetus to the economic growth too.

The other two priority areas of the proposed budget are Healthcare and Education, as they have been all time during the Social –Democratic governments. This year, we have the biggest increase of education budget in all times, by nearly 47.8 percent more than last year, therefore, an addition of over 10 billion compared to 2018. As Prime Minister, I set a goal I am very fond of: until the end of my term of office, I want all schools in Romania to meet all of the conditions of the functioning authorization. As Prime Minister, but also as mother, I have this duty, and obligation so that our children can learn in the best conditions.

We will also have a substantial rise in the healthcare budget, with nearly 15. 3 percent more, respectively by 6. 5 billion lei more. Thus, the budget allocated to healthcare reaches 4. 8 percent of the GDP, which reconfirms the preoccupation of this Cabinet with increasing the quality of the medical act in Romania. Following the increase in doctors and nurses’ pay, it is high time that this year be the year of investment in medical infrastructure.

 

Dear MPs, dear colleagues,

 

I spoke about all these increases, and I am convinced that you alongside the citizens watching us, you are rightly asking yourself where the surplus will come from. The response is given by the good economic development of the country.

In the two years of the PSD-ALDE [Social Democratic Party - Alliance of Liberal and Democrats] government, Romania has witnessed spectacular economic growth, which has been reflected in substantial increases in the income of the population.

This year, we allocate 50 billion for investment, which will boost sound economic growth and that explains quite well, among other factors, why we are counting on a 5.5 percent increase in 2019.

Romania's GDP will exceed the 1,000 billion lei for the first time, a third more than when we took over government in December 2016.

Last year, we had an economic growth three times higher than the European average, and public sector wages and pensions increased as we promised! This year, net average earning will be 50 percent higher than in December 2016.

The revenues to state budget have reached an all-time high, even as the share of revenue collection in relation to gross domestic product is lower, which is normal when rates and taxes are cut and tax incentives are provided for the economy.

And in this respect, I would like to point out that this year will be the first time with a surplus in the pension budget; it will be for the first time when more money comes to budget than the sum of the pensions in payment.

I am telling all Romanians today: Have confidence in our national economy! Dare believe in Romania which tops the rankings of the fastest growing member states in the European Union!

 

Dear colleagues,

We talked about investments, about increases in healthcare and education; I would not want people to believe that we will deviate from the planned increases in the income of the population this year, on the contrary. We have provided the budget with the necessary amounts to cover increases in public pensions and wages, as we pledged in the programme for government and the unitary pay law.

The minimum wage increases by 10pct, and pay of public sector employees increases on average by a quarter of the remaining difference for the 2018-2022. We continue to offer holiday vouchers this year of 1,450 lei per employee, as well as a food allowance equivalent to two minimum wages.

As regards the pensioners, the pension point will increase by 15pct, to 1,265 lei, starting September 1, and the minimum pension will increase by 10pct, to 704 lei.

The increase for the beginning of this year was paid in advance on July 1 last year, and was higher than the indexation provided by law, and on September 1, we will rise in advance by higher amounts than what was initially envisaged.

Dear MPs,

I would like to put aside all the fake news about the local communities budgets. Reality is one and cannot be contradicted: local administration budgets will receive more money than in previous years, and many of these additional sums are intended for local investment.

 The elected local representatives will have an increase in revenues of 7 billion lei, which will come from income tax revenues, which will remain entirely with the local administrations.

Ladies and gentlemen,

Finally, I would like to state that the draft budget for 2019 re-establihes the truth as regards our situation as country, as economy growing every year! And we want that through the measures we have presented, economic growth continues, as well as the increase in salaries, pensions, allocations to healthcare and education in the next years too. I would like you to admit that this is possible only through collaboration between Government, Parliament, President, civil society, all who have a word to say and a contribution to make to Romania’s development. What matters beyond insults, are the projects and everything we are doing for Romanians.

I want to thank everyone once again and especially the MPs who endorsed in the specialized committees this draft budget and also to thank all who filed amendments. Surely any draft budget can be improved. I respect the political decision of all who voted against this draft budget , only for political reasons. Nevertheless, I call on all members of the Parliament, that these essential, real data linked to economic, social and development measures included in the budget for 2019, is accurately communicated to those who sent us here, in Parliament, because, only this way, will we be a more cohesive society.

Thank you!



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