How profitable is working for the state?

This is the case of electricity producer Nuclearelectrica, the company with the highest average salaries. “Either Nuclearelectrica employees have very high salaries, or there are lots of managers with high salaries. Anyway the average salary is exorbitant,” executive search specialist George Butunoiu said.

Gas transportation company Transgaz ranks second, with salaries worth RON 5,003 (€1,180). Electricity producer Hidroelectrica pays an average RON 4,798, and electricity distributor Electrica employees (those at the company’s headquarters) earn an average RON 4,837 (€1,141) in gross salary, according to the revenue and expense budgets submitted to the Economy Ministry. “Salaries are much higher at some state companies. In the private sector, average gross salaries amount to some RON 2,300-2,500 (€540-590), according to the General Manager of HR company Pluri Consultants Romania, Madalina Popescu. In the mining sector, Conversmin, the company handling mine closure and preservation, pays an average RON 3,576 (€843) in gross salary, while wages at the Compania Nationala a Huilei (CNH) mining firm amount to RON 2,878 (€678). Alternatively, CNH also has the largest debts to the state budget.

Likewise, energy complexes pay salaries that are at least double those of the average wage in Romania, of up to RON 1,693 (€400). An analysis made by Business Standard, based on budgets submitted to the Economy Ministry, shows that managers of some 28 companies have salaries significantly higher than the revenues made by such companies, based on term contracts concluded with the state.

Electrica’s draft budget includes a term contract worth RON 1,835 million (€440,000) for the company’s managers. Term contracts are agreements concluded between the company, represented by its Board of Directors, and the company manager, which includes targets and performance criteria approved by shareholders. Expenses of the company’s headquarters amount to €5.9 million, of which €3.5 million are salary expenses. Electrica General Manager, Ion Folescu, told Business Standard that his salary is “somewhere above RON 4,000 (€940), similar to a state secretary, as stipulated by law.” Term contracts of gas producer Romgaz include €135,000 salaries for its management, while in the case of Transgaz, these amount to €96,000.

The management of Mangalia Naval Shipyard is to receive 85 percent of the company’s estimated gross earnings for 2009, according to term contracts. The 2 Mai Naval Shipyard is paying its employees an average gross salary of RON 2,932 (€690), more than the staff of Societatea Nationala a Lignitului Oltenia (SNLO), although the latter estimates revenues 250 percent higher than the shipyard this year. Economy Minister Adriean Videanu said that budgets have not yet been approved. “I know of no term contract concluded, in which the minister has any say. These contracts are concluded by the boards of directors. We will analyze this issue,” he told a press conference yesterday.