Ilie Bolojan‘s speech to the Parliament, as Prime Minister-designate, was articulated around two major ideas: balancing public finances and reform of public authorities, both treated with a rhetoric of urgency and the promise of tough but necessary measures.
- Balancing public finances: ‘We can no longer go on the way we have been going”
Bolojan insisted that Romania is in a critical economic situation, caused by “an unpredictable, contradictory and often populist fiscal policy”, which has led to a budget deficit of “over 9% of GDP”. In this context, he warned that “further fiscal slippage would bring Romania to the brink of default”.
To avoid this disaster, the new government aims to impose “order in spending” and “budgetary discipline at all levels of government”. In his speech, he directly criticised past practices and delivered a message of accountability to citizens: “A modern state must pay its debts, honour its commitments and not lie to its citizens”.
He also underlined the importance of strengthening budget revenues, but “without harming competitiveness and without penalising work and investment”, while pledging to fight tax evasion. It all comes down to one basic idea: “For any kind of future projects you need to have resources and a stable country”.
- Public authorities reform: ‘Institutions out of control”
The second central theme of the speech was the need for a radical reform of the state apparatus. Bolojan stated categorically that “Romania’s biggest problem is not the lack of resources, but waste and inefficiency”. In his opinion, the Romanian public administration is “burdened by bureaucracy, duplication of functions and institutions” and suffers from “chronic inefficiency”.
He presented a list of clear, but as yet unwritten legislative measures: functional audit of institutions, administrative reorganisation, simplification, digitalization and decentralisation. The key message was that “the civil service will be conditional on competence, integrity and results”, and that ministries will no longer be “sinecure seats”.
This reform not only concerns the institutional structure, but also the relationship between the state and its citizens: “Respect for citizens” will entail quality public services, meritocracy, protection of the vulnerable and “depoliticisation of finances, schools and hospitals, not through pseudo-competitions, but by imposing performance criteria”.
The two objectives of the new Government are aligned in the long term but diverge in the short term. Balancing public finances rapidly requires administrative and political trade-offs. This means maintaining (useless) ministries or vice-premier portfolios, (incompetent and/or anti-reform) ministers and measures (such as maintaining the pole tax, the turnover tax on large companies or the increase in excise duty on fuels) that are far from generating optimism about the promised reform of public authorities.
From the energy sector’s perspective, the most dangerous ideas by far are the prolongation of the energy price cap scheme and the identification of the European Commission and a possible infringement procedure as the main problems. Only in subsidiary, Minister Bogdan Ivan (PSD) referred to shortcomings at local level, such as the unfairness of the capping scheme, the lack of complete data at the Ministry of Labour on vulnerable consumers or the unsustainable cost of maintaining the scheme in its current form. The new minister made no reference in this context to the adverse effect of this capping scheme in terms of discouraging investment in new generation capacity, investment in energy efficiency and competitive trading and supply activity.
