Pensioners to get EUR 20 bonuses?

In the last phases of talks with the IMF, government officials are discussing bonuses for pensioners and state employees. While initially the Serbian government wished to unfreeze public sector salaries in by the end of this year, the latest round of revision talks on the EUR 2.9bn loan arrangement with the IMF came down to bonuses. Pensioners to get EUR 20 bonuses? The amount of the bonuses remains unclear, and where the money would come from, since there is none for increase of salaries in the state budget. According to Belgrade daily Vecernje Novosti, pensioners and workers in the public sector could be receiving bonuses in October and December. Earlier in the day, Ruling Pensioners Party (PUPS) official Momo Colakovic told state broadcaster RTS that he expected an agreement to be reached on Wednesday with the IMF for pensions to be increased according to increases in wages of the public sector. Economic expert Radojka Nikolic told B92 that the main problem with the bonuses and the unfreezing of wages and pensions is that there is not enough money in the budget. “Even though bonuses of RSD 2,000 or 5,000 (EUR 20 to 50) look modest, it is a lot of money, considering how many people need to receive them,” she said. Nikolic said that there was not enough spending to support production and that there was “no way to increase spending”. There is also the problem of a low living standard, lack of money, decrease of the value of the domestic currency and inflation. “The only way out of this trap is with increases in production and exports, and we have low production, two million employees, and 330,000 of which work in production. There is no way that these people can create enough income,” Nikolic said. According to sources close to the current talks, the Serbian government’s proposal not to allow pensions to fall under 60 percent of the average wage will not be accepted by the IMF. The IMF is expected to come back to Serbia in late August in order to discuss a revision of the state budget, and the budget deficit for 2011.

Pensioners to get EUR 20 bonuses?

The amount of the bonuses remains unclear, and where the money would come from, since there is none for increase of salaries in the state budget.

According to Belgrade daily Večernje Novosti, pensioners and workers in the public sector could be receiving bonuses in October and December.

Earlier in the day, Ruling Pensioners Party (PUPS) official Momo Čolaković told state broadcaster RTS that he expected an agreement to be reached on Wednesday with the IMF for pensions to be increased according to increases in wages of the public sector.

Economic expert Radojka Nikolić told B92 that the main problem with the bonuses and the unfreezing of wages and pensions is that there is not enough money in the budget.

“Even though bonuses of RSD 2,000 or 5,000 (EUR 20 to 50) look modest, it is a lot of money, considering how many people need to receive them,” she said.

Nikolić said that there was not enough spending to support production and that there was “no way to increase spending”.

There is also the problem of a low living standard, lack of money, decrease of the value of the domestic currency and inflation.

“The only way out of this trap is with increases in production and exports, and we have low production, two million employees, and 330,000 of which work in production. There is no way that these people can create enough income,” Nikolić said.

According to sources close to the current talks, the Serbian government’s proposal not to allow pensions to fall under 60 percent of the average wage will not be accepted by the IMF.

The IMF is expected to come back to Serbia in late August in order to discuss a revision of the state budget, and the budget deficit for 2011.