Public budget - The 2008 budget doles out more money for social insurance, local administration

Lawmakers papered over some 994 amendments and looked through other 112 changes drafted by the specialized committees in Parliament.

Last-minute changes approved by Parliament included among others a slight increase of teachers’ salaries, extra funds for students’ scholarships and other social protection measures.

Parliamentarians voted what was called by many a rather electoral budget, but stressed the stance in favor is anything but an encouragement of the government. Members of the opposition bided for many social amendments within the budget draft and criticized the Cabinet’s low focus on pensioners.

In November, the central bank asked for a tight budget and lower expenditure targeting a balance between revenues and spending.

Central bank’s governor warned Romania’s top economic vulnerability resides in its external deficit. “The excessive use of monetary policies as an adjustment instrument is a very dangerous thing,” he said last month.

The increase of salaries outpaces labor productivity, he also emphasized. When combined with the appreciation of the leu, the two lead to the widening of the external deficit, the BNR official explained. The governor reminded the country’s economic policies must be strengthened during longer election periods.