By Luiza Ilie
BUCHAREST (Reuters) -Romania’s top court struck down on Monday a government plan to raise the retirement age for judges and prosecutors and cap their pensions, raising questions over the ruling coalition’s stability as it tries to curb the EU’s biggest budget deficit.
The Constitutional Court rejected, by five votes to four, proposals to raise retirement in the judiciary to 65 from around 50 at present and cap pensions to 70% of final salary.
Judges and prosecutors have monthly pensions of up to 5,000 euros ($5,831) versus the Romanian average of 600 euros.
Though it was unclear if the proposals were rejected on a technicality or in principle, the hard-right opposition Alliance for Uniting Romanians called for the resignation of liberal Prime Minister Ilie Bolojan who leads a months-old coalition.
Government spokesperson Ioana Dogioiu said there would be no comment until the court had published its statement.
Centrist President Nicusor Dan said the government will draft a new law that incorporates the court’s arguments but which “corrects magistrates’ pensions in a way that is equitable for society.”
Bolojan’s government has raised some taxes from August to boost revenue and enforced minor cuts to state spending.
Those measures were enough for Romania to cling to its rating on the last rung of investment grade, but they came at a steep cost, triggering public sector protests, fuelling inflation and bolstering the hard right in opinion polls.
DEFICIT REDUCTION MEASURES
In September, the government fast-tracked through parliament a second package of spending cuts aimed at eliminating what Bolojan called unjust privileges for a few in the public sector.
The package included some tax hikes from 2026, raising the judiciary retirement age, job cuts and wage curbs for financial, energy, telecoms regulators and state-owned firms, and healthcare reform.
The measures, part of wider efforts to reduce the deficit towards 6% of economic output next year from more than 9% in 2024, have all been challenged at the Constitutional Court.
Though it endorsed changes to state regulators and companies as well as healthcare reform and tax hikes, it was not compliant with the judiciary changes. Judicial pension reform is a requirement for Romania to access EU recovery and resilience funds.
Bolojan has said his government would lack legitimacy should the top court oppose the measures, though he later said he was focused on governing rather than considering his resignation.
($1 = 0.8575 euros)
(Reporting by Luiza Ilie; Editing by Andrew Cawthorne)
Comments