The CCR decision blew up a PNRR milestone of 231 million euros, according to the Government. What can happen now?

A PNRR milestone of hundreds of millions of euros depends on the reform of magistrates' pensions, rejected on Monday by the Constitutional Court (CCR), recently said Prime Minister Ilie Bolojan, who was accused by the Superior Council of Magistracy (CSM) of lying for this statement. The reply came from the Minister of Investments, Dragoș Pîslaru, who said that the CSM's claims were “unfounded and dangerous”. He reinforced the prime minister's statement and said that European funds of 231 million euros depend on the CCR's decision.

Milestone 215 of the PNRR provides for the “Entry into force of the legislative framework for the reduction of expenses with special pensions” (allowances and pensions established and paid on the basis of special laws)”.

In March of this year, the Ministry of European Funds stated that Brussels “informed Romania that milestone 215 can no longer be considered satisfactorily met, against the background of equity issues in establishing certain categories of special pensions in relation to the general public public pension system. The value of the amount suspended until the milestone is satisfactorily met is 230 million euros.”

Bolojan: A stake of hundreds of millions of euros from PNRR

On October 9, after the Constitutional Court had twice postponed the decision on the law on magistrates' pensions, Bolojan said that this “is a necessity and I hope that at the next meeting of the Constitutional Court this subject will be closed”.

“We could not continue like this, they will have to reduce them,” added the prime minister, referring to the special pensions, avoiding criticizing the Court.

Asked about the reform of magistrates' pensions and the decision postponed by the CCR in this regard, in an interview on B1 Tv, the head of government said:

“Here are three aspects that I could point out. Indeed, solving the magistrates' pensions is a milestone, so an obligation that Romania has assumed in the past years, on which depends an amount of over 200 million euros that Romania has not received at the moment, and we have two more milestones, each of which has 200-300 million euros. In total, the three milestones are over 800 million euros which indeed if we do not respect them, if we do not them we put into practice, we don't take this money. It is quite a significant amount. That would be, let's say, the part related to European funds”.

CSM says there is no connection

The next day, the CSM stated that the draft law reforming magistrates' pensions for which the government assumed responsibility in Parliament has nothing to do with Romania's obligations in the PNRR.

In response to the Prime Minister's statements, the CSM stated that milestone 215 has already been positively evaluated by the European Commission.

In a press release, the CSM “calls for the observance of legal and institutional truth and responsibility in public communication” and conveys to the prime minister that “no political pressure on the constitutional court is allowed.”

“At a time when the public debate is marked by distortions and tendentious interpretations, the Council calls for respect for the legal and institutional truth and for responsibility in public communication, not allowing any kind of political pressure on the constitutional court. Justice cannot be a constant theme of the electoral campaign, and strengthening the rule of law requires honesty, rigor and balance in the relationship between the powers of the state”, transmits the CSM.

Pîslaru, harsh response to the CSM: “dangerous” statements

Investments Minister Dragoș Pîslaru then accused the CSM of “unfounded and dangerous” statements, insisting that the reform of magistrates' pensions is a milestone in the PNRR on which 231 million euros from European funds depend

The Minister of Investments and European Projects said that “it is unacceptable for a state institution to mislead public opinion and directly contradict the reality confirmed by the European Commission”.

“From the perspective of the Commission, the milestone regarding the reform of the pension system has not been met, which is why the related European funds — 231 million euros — have been suspended until the situation is clarified,” says the minister.

He points out that the issue has been discussed with Céline Gauer, the PNRR implementation coordinator at European level, who has confirmed that milestone 215 will be met when the government finalizes the changes undertaken by the PNRR.

“Therefore, the statements of the CSM are not only unfounded, but also dangerous — they affect Romania's credibility in the relationship with the European Commission and fuel a false perception that the Romanian state does not respect the commitments assumed”, says Dragoș Pîslaru.

An “optimistic sliver” for plan B

A month ago, PSD Minister of Labor, Petre Florin Manole, said that, in the event that the Constitutional Court declares unconstitutional the project that modifies the system of special pensions for magistrates, there is an “optimistic sliver” that “there is still room and time to improve it, before losing the money from the PNRR”.

Petre Florin Manole told RFI that his hope is that the project will be declared constitutional, “but the CCR has its own dynamics”: “We, as politicians, have only to respect the decisions of the Court, but I would not want to anticipate”.

When asked what should happen if the Constitutional Court declares the project unconstitutional, the Minister of Labor answered: “I want to be as collegial and constructive as possible and say that I do not start from the premise that this project will be declared unconstitutional and I do not think that we, as politicians, should make pessimistic scenarios from the first moment. On the other hand, obviously we cannot ignore the fact that there is a milestone in the PNRR that needs of fulfillment, which means some money that Romania would lose, if this project did not go to the end”.

Petre Florin Manole also said that “the optimistic sliver, if this project will be declared unconstitutional, is that there is still room and time to improve it, before losing the money from the PNRR”: “There is still room for plan B, but that from the PNRR point of view, not from the political point of view. From the political point of view, the opinions and decisions of the prime minister belong to the prime minister”.

The prime minister threatened to resign, then reversed his position

Initially, at the beginning of September, Prime Minister Ilie Bolojan said that the Government can no longer continue if the project on magistrates' pensions falls to the CCR, talking about a lack of legitimacy.

Later, in a press conference on September 24, Ilie Bolojan said that he intends to remain in the position of prime minister regardless of the CCR's decisions regarding these laws.

“I've constantly seen talks about resignation, but that's not what I'm thinking about now. I'm thinking about the measures we have to take in the next period, how to get our country to the port, how to develop, and political stability plays an important role in this. I said and I continue to say that I will stay in this position as long as I can do something relevant. If I ever make the decision to resign, I will let you know, there is no need to every meeting ask me the same question or speculate”, said Prime Minister Ilie Bolojan.

Amendments to the legislation on magistrates' pensions

The law on magistrates' pensions brings a series of changes such as:

• the retirement age for magistrates should be the standard one in the public pension system, i.e. 65 years;
• magistrates who want to retire must have at least 35 years of experience, compared to 25, as it is currently;
• until 2036 the retirement age gradually increases.

The law should have entered into force on October 1, according to the act approved by the Government and Parliament, but given the delay in a decision from the CCR, this could not happen.