Radical reform proposed by Claudiu Năsui: 13 budget cuts with major impact

At a time when part of the political class would like to resort to tax increases to recover the budget deficit, MP Claudiu Năsui (USR), former Minister of Economy, Entrepreneurship and Tourism in the Cîţu government, states in a post on his official Facebook page that there are clear and immediate options through which the state can reduce spending without affecting essential areas such as pensions, social assistance, the army budget or co-financing for European projects. Mr. Năsui exemplified in yesterday's post that the implementation of 13 measures could reduce budget spending by 32 billion lei.

Claudiu Năsui specified: "13 spending cuts that can be made from the first second. (...)

1) Capping all bonuses and salary increases at 30% of the basic salary.

2) Capping all state revenues at the level of the President of Romania's salary.

3) Simplifying the dismissal of state employees due to budget cuts until a 10% reduction in spending is achieved for the entire year.

4) Reducing spending on goods and services by 10% everywhere, except for health.

5) Eliminating daily allowances for transportation and accommodation (there is a festival about them in parliament).

6) Eliminating professional training courses at sea and in the mountains. Training should be done at the institution's headquarters or electronically.

7) Stopping subsidies for parties.

8) Stopping the PNDL and other redistribution programs to UATs.

9) Stopping subsidies and schemes for companies, data from the state budget.

10) Stop capital increases in state-owned companies.

11) Cutting grants and core funding for NCDIs, which remain financed from the revenues they receive from services provided.

12) Eliminating special administrators for privatization.

13) Prohibiting the hiring of lawyers for trials on certain types of cases, such as disputes without material damage, for example those on the transparency law 544".

From the analysis of the above measures it appears that, although most of them can be easily implemented, there are several measures for which it seems that the former Minister of Economy did not take into account the social or community impact, an impact that will lead to opposition from society regarding their application. For example, in the case of capping all bonuses and salary increases at 30% of the basic salary, there will certainly be strong opposition and street protests from unions in the budgetary system. Then, in practice there are situations where exceeding the 30% threshold is justified by the overtime and huge workload of some employees in the budgetary system, such as those in Health or those in the Ministry of Interior or the Ministry of Justice (see the case of police officers who ensure the security and proper functioning of prisons in Romania).

Then, in the case of simplifying the dismissal of state employees on budgetary criteria up to a 10% reduction, massive layoffs can lead to social and economic tensions, especially in areas dependent on the salaries of public sector employees (in rural areas and small towns), tensions that can also arise due to political abuses that can occur within this extensive process of layoffs.

Regarding the measure that refers to stopping the financing of projects carried out through the National Local Development Plan - stages I and II and other redistribution programs to administrative-territorial units, although such a measure will eliminate political clientelism and inefficient investments, it will directly affect the development of small communities that have no other sources of investment, and the total blocking of such investments in infrastructure would create major regional imbalances.

Another measure proposed by Claudiu Năsui, which requires correction, is that regarding the stopping of subsidies and schemes financed from the state budget for companies in our country. Even if this measure will turn off the tap of aid distributed in a non-transparent manner or with questionable economic efficiency, some sectors (agriculture, energy, SMEs) actually depend on these schemes, and their sudden elimination and the related financing may generate a real shock to the national economy.

Another controversial point is where Claudiu Năsui claims that there is a need to cut grants and core funding for national research and development institutes (INCDs), which would be financed only from the income obtained for the services provided. Given that at the European level, Ursula von der Leyen states that the member states of the European Union must invest more in the research and development sector, a measure proposed by the former Minister of Economy seems to oppose the policy of the community bloc. This is given that it is known that fundamental research activity does not only be supported by the market. The implementation of such a measure could leave our country without basic research, which would have a negative impact in the future on the competitiveness of companies and the national economy.

In light of the above, it can be said that many of the 13 measures proposed by Claudiu Năsui are feasible and necessary, and their implementation would show a real will to reform. The most efficient and easiest to apply are those that target caps, per diems, courses, unnecessary functions and limitations on special benefits, and the most sensitive are those that involve restructuring, cuts in subsidies and reforms in research or local investments, which require careful transition and compensatory policies. Applied intelligently, these measures could reduce the current waste in the state budget, attract efficiency in this sector and eliminate the need for tax increases. Applied brutally or purely for accounting reasons, these measures could create social and economic imbalances.