Thursday, June 17, 2010

Romania opposition asks court to rule on austerity

Wed, Jun 16 2010

BUCHAREST (Reuters) - Romania's opposition appealed to the country's constitutional court on Wednesday to rule on whether the government's planned harsh spending cuts, measures needed to secure an international aid package, are legal.

The leftist Social Democrats failed to topple Romania's coalition government with a no-confidence motion on Tuesday over the planned cuts of 25 percent in public sector wages and 15 percent in pensions and now hope the powerful court will block the measures.

Opposition leader Victor Ponta said his party would challenge the cuts, which the government needs to push through to secure a 20 billion euro IMF-led economic aid deal, adding he was disappointed and upset the no-confidence motion had failed.

The centrist government can start applying the austerity measures ahead of any court judgment, but if declared unconstitutional they would have to be revoked.

The IMF requires the measures to pass that stage before releasing the latest 2 billion euro tranche of aid to the recession-hit economy.

The EU's second poorest member has pledged to reform its sprawling, highly-unionised public sector, but labour resistance is casting doubt over the austerity drive and raising the spectre of Greek-style debt woes in the country of 22 million.

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