We borrow in order to pay the bills and expenses made by the Social Democratic Party (PSD), and had the PSD been a responsible party, it wouldn't have passed laws in Parliament without the necessary funding source, Finance Minister Florin Citu said on Monday in the Chamber of Deputies' plenary.
"I left the discussion about loans for the end, a soup reheated by the signatories of this motion. It's time for me to teach you a lesson of economics, and you have to listen carefully, because I don't know if I'll ever come to talk about loans again. I saw that you presented yesterday half of a pharaonic program. It is obvious that Dragnea still leads this party. You must understand how a budget deficit is financed, because Romania has been running a deficit for a long time. What does a budget deficit mean? It means that expenditures exceed revenues and the difference must be covered from somewhere. And I'll give you the three options for covering the deficit, because I know that you are incapable of cutting spending. You only know how to increase it. First of all, what has PSD done for years? It didn't pay bills. You don't pay bills, you reduce the budget deficit. We don't do this, we are not grifters. We are an honest partner of the private sector. Then you can increase taxes. We are not doing this either, we are not raising taxes, but you should be honest with the Romanians and tell them that you will increase taxes because the program you presented yesterday entails that. The third option: borrowing. We borrow in order to pay the bills and expenses made by PSD," Florin Citu said in the Chamber of Deputies' plenary that debated the simple motion tabled against him by PSD.
In this context, Citu emphasized that higher wages will be paid in the public sector this year, as well as pensions by 15 percent higher since September 2019, and inflation-pegged child allowances, which are all additional expenses.
"Had the PSD been a responsible party, it wouldn't have passed laws in Parliament without the necessary funding source. As far as I am concerned, at the beginning of the year I froze the wages of the dignitaries and local elected officials. Yes, I am a responsible and cautious minister. And because I am cautious, in addition to the loans that cover the current expenses, I also built a significant buffer which has proved to be a lifeline at the moment when the financial markets all over the world froze," he said.
According to Citu, the loans raised in April were directed to: personnel expenses - 8.8 billion lei, by 60 million lei less compared to March because of remote work; pensions - 6.4 billion lei; benefits during the temporary suspension of the individual employment contract at the initiative of the employer (furlough) - 312 million lei; unemployment benefits - 61.6 million lei; allowances for other professionals and for persons who have agreements - 96 million lei.
"In total, over 400 million lei for those affected by the crisis in April alone," said Florin Citu.
The allowances granted to parents who stayed at home to supervise their children during the temporary closure of the schools amounted to 200,000 lei, and the emergency medical inventories - approximately 200 million lei.
April's sick leave pays amounted to 366 million lei.
"We have borrowed in order to pay higher pensions, higher wages, furlough benefits amid an unprecedented crisis, and this is what hurts you most. I have raised money at a lower cost than you did last year. One percentage point less. This shows the confidence of foreign investors in Romania, I am the only minister in history who has managed to borrow for negative interest rates, that is, we pay back less than what we borrowed. This is the indicator that shows that all investors trust the government of Romania and the measures implemented by us. Lower rates, negative interest rates, this is how confidence is measured in the financial world," the FinMin pointed out.
As regards the country rating, Citu said that all the rating agencies talk about the budgetary disaster in the last years and about the laws with various expenditures the source of which has never been indicated.
"I cannot help but notice a great deal of masochism, or maybe of stupidity in the ranks of PSD, which brings up the country's rating as all the agencies talk about the budgetary disaster in recent years and the laws with all kinds of expenses the source of which was never indicated. I guarantee you that I won't stop here. No matter how many simple motions, curses and threats I'll get from the Socialists, I will continue to manage Romania's finances just as professionally and cautiously," said Florin Citu.
The Chamber of Deputies debated today the simple motion tabled by PSD against Finance Minister Florin Citu, titled "The Citu Virus has Infected the National Economy."
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