Principles for country modernization and efficient administration, as outlined in Romania's 2025-2028 Administrative Strategy by the governing body.
Redefining Romania's Public Sector: The 2025-2028 Blueprint
The fresh government is boldly setting its sights on a transformative agenda, aiming to modernize Romania's public sector, enhance efficiency, ensure fiscal stability, and champion fairness for its citizens. This ambitious overhaul is structured around several strategic pillars, including structural reforms, fiscal consolidation, investment prioritization, decentralization, and the rationalization of public spending.
Reclaiming Authority and Coherence
This transformation is driven by a resolve to restore authority and coherence in public governance. A new legislative overhaul will pave the way for state restructuring, including Central Public Administration reforms through mergers, consolidations, and redundant entity elimination. This will be matched by fair budget corrections and the elimination of privileges across the public sector.
Uniting for Progress
The reform effort is a united front, involving all coalition parties, focused on improving public management performance and accountability, correcting social and economic injustices, and fostering an environment of honesty and respect for both citizens and businesses.
Combat Tax Evasion, Boost Revenues
A key component of the program is a sustained fight against tax evasion, with a focus on bolstering public revenues. Key fiscal agencies such as ANAF, Antifraud, and Customs will see depoliticization and reorganization, with digitalization and risk-based inspections central to their operations.
The government plans to tighten legislation around tax evasion, enforce stricter insolvency laws to prevent abuse, and prioritize oversight in sectors prone to evasion, including oil, fruit, and vegetable imports, and services. Taxation will be extended to gambling, cryptocurrencies, short-term rentals, and income from social media. Existing real estate exemptions will be revised, and excess profits in sectors such as banking may be subject to temporary taxation. Companies benefitting from state support will pay taxes on related activities.
Fiscal Consolidation for Long-term Stability
For long-term fiscal balance, a recalibration of the tax system is proposed, involving a reset of VAT rates, increases in excise duties, and enhanced taxation of dividends and large pensions. A property tax aligned with market value and an ecological tax are also on the agenda, as stipulated by the PNRR (National Recovery and Resilience Plan). Public spending will be curbed through salary and pension caps.
Smart Investment, Cost-efficiency
A new framework will guide the analysis and prioritization of investment projects funded by the national budget. Local authorities will be required to co-finance projects based on their financial capacity, with a focus on sustainability using specific demographic and infrastructure indicators. Cost standards will be revised, and government-funded support schemes will be restricted to those that promote exports, reduce imports, or create added value.
Streamlining Local Administration
Local Public Administration will be realigned with updated population data. National salary scales will be introduced for local authorities that cannot cover salaries from their own revenues, and staffing limits will be enforced. Incentives will promote local performance in tax collection and urban planning. Coordination between Local and National Police will be strengthened, and public utilities operating without proper authorisation will be transferred to licensed regional operators.
Lawmaking to Support Reforms
To support institutional reform, the government will revise the status of civil servants and parliamentarians, simplify the Labour Code, and streamline the evaluation of both staff and institutional management. Reforms will also target the social dialogue law and collective labour agreements that have led to excessive entitlements.
Revamping State-owned Enterprises
State-owned companies are in store for a substantial overhaul. Boards will be populated with professionals, with a reduction in redundant governance structures. Where justified, staff reductions will be implemented. Transparency will be improved through published budgets and contracts, and pay will be tied to responsibilities and measurable performance indicators. State subsidies will be reduced, and loss-making enterprises may be closed.
Restructuring Autonomous Institutions and Central Administration
Autonomous institutions such as ANCOM and ASF will undergo restructuring, with operating laws amended, salaries capped, and non-essential staff reduced. Any budgetary savings will either be reinvested in the market or redirected to the state budget. Central administration will be restructured through simplification, decentralization, and digitalization. Staffing levels will be recalculated, excessive bonuses removed, and remuneration brought in line across the public sector.
Better Health, Boosting Labor Force Participation, and Updating Natural Resource Management
focused on improving the healthcare system, measures to reduce abuse in the granting of sick leave and disability benefits, expanding labor force participation, better use of natural resources, and more.
(Photo source: Inquam Photos / Octav Ganea)
(Stay updated with us for more detailed analysis on the Romanian government's state reform program!)
The forthcoming legislation, a part of the broader reform effort, targets the restructuring of Central Public Administration through mergers, consolidations, and the elimination of redundant entities, aiming to restore authority and coherence in public governance.
Simultaneously, fiscal agencies responsible for combatting tax evasion, such as ANAF, Antifraud, and Customs, will undergo depoliticization, reorganization, and digitalization to boost revenues and ensure a fair tax system.
