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Ilie Bolojan criticizes the Niculescu Government's program for failing to reduce VAT and increase salaries and pensions: “Do you remember how much some criticized the VAT increase?”

Matei Gaginsky

19 October 2026, 18:30

Economy

Foto: Inquam Photos /Octav Ganea

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Interim Prime Minister Ilie Bolojan criticized on Monday evening the government program proposed by the Executive formed by the Social Democratic Party (PSD) and technocratic ministers, pointing out that the document does not include measures previously presented as urgent: a reduction in the value-added tax, larger subsidies for fuel used in agriculture, salary increases, and pension indexation.

Bolojan said that politicians who criticized the VAT increase and promised benefits for farmers no longer support these measures in the current program. He stressed that, after two years without increases in public-sector salaries and pensions, it is difficult not to find a solution for indexation, but any additional spending must be covered through higher revenues, cuts to other expenditures, or limits on investment.

The interim prime minister argued that adopting a unified pay law would have allowed for differentiated indexation and would have prevented the loss of €770 million. According to him, employees below the normal pay level would have received increases of 10%, 20%, or 25%, while salaries that were already high would have been frozen until the gaps were reduced. Bolojan warned that across-the-board indexation could deepen inequalities in the public sector.

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Context: Bolojan justified the VAT increase and linked the reforms to avoiding the loss of funding and budgetary stability

Prior to the criticism related to the governing program, interim Prime Minister Ilie Bolojan said that he did not regret increasing VAT from 19% to 21%, arguing that the measure was necessary to avoid the suspension of European funds and the risk of Romania defaulting on its obligations. He argued that Romania should have presented, within two weeks, a credible plan to improve budget revenues, following promises that had remained unfulfilled for two years.

At the same time, Bolojan warned that the political deadlock could increase interest rates and affect the country's rating, especially if the budget revision is delayed. He also proposed a compromise option: a technocratic government with limited objectives (the budget revision, closing the PNRR procedures, and drafting the 2027 budget), while rejecting, as a means of financing public spending, the idea of raising salaries through “over-taxing the private sector,” insisting on reducing spending, including by cutting public administration staff by 10%.