Romanian government survives no-confidence vote amid coalition austerity rift
BUCHAREST - Romania's government survived its first no-confidence motion on Monday after Parliament rejected a challenge from far-right parties, but the vote exposed growing tensions within the pro-EU ruling coalition.
The failed motion was brought to Parliament by far-right parties AUR, POT, and SOS in response to growing public backlash over the government's fiscal consolidation measures unveiled last week.
Among other things, the Romanian government plans to raise the standard VAT rate from 19% to 21%, and replace the reduced rates of 5% and 9% with a single rate of 11%, which will affect essential items such as food and medicine.
Romania's ruling pro-EU coalition includes the centre-left PSD, centre-right PNL, reformist USR, and the Hungarian minority party UDMR, led by Prime Minister Ilie Bolojan.
However, acting PSD leader Sorin Grindeanu sharply criticised the government's approach, warning it risked repeating the 2010–2011 austerity-driven collapse.
'We didn't sign up to turn a budget crisis into a deep economic crisis,' he said in a bid to distance his party from the austerity measures implemented by the government.
Grindeanu accused the government of placing the burden on low-income citizens and reiterated the PSD's call for a progressive tax system as a fairer alternative to widespread tax hikes. He argued that a well-designed progressive model would have avoided the need to raise the VAT.
Centrist president Nicușor Dan also took aim at the VAT hike, stressing in a press conference that he had promised to keep it at 19% during coalition negotiations. 'I still believe it was the right path,' he said, noting that other budgetary solutions had been available.
Prime Minister Ilie Bolojan defended the government's fiscal stance, pointing to 'early positive signs' from international markets.
He also announced a second package of expenditure cuts to be unveiled by the end of July.
(cs)
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