Romania parliament approves 40% hike in pensions

Eleven deputies abstained. The opposition Social Democrats, in power until last November and still parliament's biggest party, unveiled last year the massive hike in pensions from Sept. Measures to boost social spending ahead of a Sept. 27 municipal ballot and parliament poll later this year have raised concern over stretched deficits with Brussels and rating agencies, which have Romania on their lowest investment grade.

Romanian lawmakers on Tuesday approved a 40% hike in state pensions to 1,775 lei ($429.7), torpedoing the centrist minority government's move to enforce a smaller, but sustainable increase of 14%. Parliament voted 242 to 148 to endorse the hike, a ruling party deputy told Reuters. Eleven deputies abstained.

The opposition Social Democrats, in power until last November and still parliament's biggest party, unveiled last year the massive hike in pensions from Sept. 1, and a doubling of child benefits, prompting warnings of ratings downgrades. Measures to boost social spending ahead of a Sept. 27 municipal ballot and parliament poll later this year have raised concern over stretched deficits with Brussels and rating agencies, which have Romania on their lowest investment grade.