PM Emil Boc: We have the largest infrastructure budget since 1989

„The 2009 budget is realistic. It is harsh with the present and fair with the future. We foresee a 2.5% economic growth and a 2% budget deficit this year. In 2008, given the 7% economic growth, the budget deficit was 5.2%. Even worse, the deficit doesn’t come from investments, but from personnel-related expenses. Also in 2008, there was a 7 billion difference between the estimated budget income and the real income”, said Romanian orime minister Emil Boc on Monday.

Emil Boc’s main statements in brief:

• Any society must find its balance between its economic and its social components;
• We face the worst crisis in the past 60 years;
• The deficit in 2008 doesn’t come from investments, but from personnel-related expenses;
• The budget we sent to the Parliament is realistic;
• We foresee a 2.5% economic growth and a 2% budget deficit this year;
• Romania suffers from bureaucratic obesity and waste;
• We have the largest budget slice for infrastructure since 1989, 20% of the GDP.

The governmental anti-crisis plan, in brief:

• 20% of the budget will go to massive investments in infrastructure;
• Maintaining the 16% flat tax;
• The Government’s debt is a priority. Without paying the remaining debt, the economy is blocked;
• The re-invested profit will not be subject to taxes, starting in 2010. The impact of this decision will be 3.44 Bn RON, representing 0.59 of the GDP;
• Compensating VAT returns with VAT to be paid will be possible;
• The last state-owned banks, CEC and Exim Bank, will be capitalized;
• There will be a fund to help small and medium enterprises;
• The „Wrecks” program (buying back old cars in exchange for incentives when buying a new car) will continue and will grow. Ten-year old cars will be accepted, instead of the minimum 12-year old cars in the previous programs;
• The general budget will include the income of state agencies and institutions;
• The minimum pension will be 350 RON, growing in two steps – on May 1 and October 1;
• The retired persons will have the medication compensated by 90% for those with pensions under 600 RON, necessary funds will be gathered from the tax on vice;
• Compensating VAT to be paid with due VAT;
• Including the income of governmental institutions and agencies in the consolidated state budget.