Labour Minister talks about layoffs

The Government has decided to put an end to the severance payment system granted to the unemployed. Therefore, those to be laid off following the privatisation of the first 17 companies included in PSAL I will only get unemployment compensation.

Small and medium-sized companies to hire jobless people will get money from the State, though. The 10,000bn lei granted from the unemployment fund for severance pays last year represented “a big mistake” that led to “no work motivation,” therefore in order to help those “temporarily unemployed regain their appetite for work” the Government this year will allot 1,700bn (13.4%) lei from the unemployment budget for “active measures” to hire unemployed persons and create jobs, according to Labour minister Marian Sarbu.

Of the total 1,700bn lei, 175bn will go to the accounts of the small and medium-sized companies willing to hire the unemployed. To boost the employment of young people, the Government is ready to spend 246bn lei, Sarbu said.

At the same time, the Labour Ministry is in talks with several countries in Europe, which could take over part of the Romanian workforce. Portugal may take 5,000 construction workers, while Italy might take 3,700 silvicultural workers, according to Sarbu.

Negotiations with Ireland and Spain for the same purpose are in progress. The Executive is hoping to have the unemployment rate decrease to 7-8% at the end of its four-year mandate, Sarbu said.

The Labour minister added that the Ministry was working on a new law of the universal pension funds to be sent to Parliament this fall. An agreement in this regard has already been reached with the World Bank for starting an assistance programme for the privately-managed universal pension funds, according to Sarbu.

Nastase Cabinet at the beginning of its mandate had withdrawn the emergency ordinance on operating private pension funds, issued by Cabinet Isarescu. Sarbu said that the ordinance had been withdrawn because ” such a system must be introduced by law and not by ordinance.”