Public sector pay system to be reformed

The Government is proposing a broad reform of the public sector pay system, which envisages creating a system based on fairness, predictability and performance. The proposed changes were presented today by the Minister of Finance, Andrian Gavriliță, who emphasized that the reform will bring salary increases for the majority of employees in the public sector. Calculations show that around 170,000 employees in areas such as education, health care, culture, sports and local public administration will benefit from pay raises. The authorities plan for the higher salaries to be applied starting in the autumn of this year.


“Today we are presenting one of the most important structural reforms of public administration in the Republic of Moldova in recent years – the reform of the public sector pay system. This reform is not only about salaries, it is about people, it is about those who educate future generations, about those who take care of our health, about those who ensure public order. We are talking about all those who, day by day, make sure that the functioning of the state is as good as possible and reflects a truly modern state,” said Andrian Gavriliță at a press conference held together with the Minister of Labour and Social Protection, Natalia Plugaru.


The Minister of Finance stressed that the reform has four essential objectives: more pay equity, increasing the share of the basic salary in the total income of civil servants, medium- and long-term budgetary sustainability, and the gradual reduction of the number of reference values, so that in the future, when wage increases are granted, all employees can benefit from them.

Andrian Gavriliță mentioned that the reform targets around 170,000 employees in areas such as education, local public administration, public order, health care, culture and sports, who will receive salary increases ranging between 10 and 30 percent.


“One of the most important messages I want to convey today is that this reform brings long-awaited and well-deserved pay raises for the majority of employees in the public sector. We are talking about around 170,000 people who will see their incomes increase. We refer here to about 60,000 people in the field of education, a sector essential for the future of our country. We are talking about around 50,000 technical employees. We are talking about around 20,000 employees in town halls and public administration. Seventeen thousand employees ensure public order. We are talking about those in health care, culture and sports. Most of these people, who ensure the functioning of the state, will receive increases between 10 and 30%, depending on how fairly these raises were granted in previous years,” said Andrian Gavriliță.


The minister explained that no person will have a lower salary as a result of the reform, with a mechanism being applied to ensure that no pay cuts will occur.


“We will have no losers. No one’s salary will decrease under this reform. There are mechanisms that will ensure that we do not have cuts anywhere, even if in some cases there will be no increases, due to the fact that there have already been raises in previous years,” Gavriliță emphasized.


An essential aspect of the proposed reform is that clear performance criteria and a performance bonus will be established.


“At present, unfortunately, in very many institutions a performance bonus is granted to 99% of employees, and we all understand that this is not a performance bonus, but rather a payment given to everyone. The new law will stipulate that less than half of employees may benefit from a performance bonus, so that there must be very clear criteria and we truly reward more where more work is done. At most 15% of employees will be able to receive maximum bonuses or excellent grades for the recognition of these performances,” explained the Minister of Finance.


The head of the Finance Ministry noted that the reform is being proposed under conditions in which “in recent years, the pay system has become increasingly complex, more difficult to understand and, in many cases, less equitable.”


“Numerous exceptions and mechanisms have appeared, which have led to similar positions being remunerated differently. At the same time, many functions essential for the quality of public services have remained undervalued,” the official pointed out.


The new rules were proposed following analyses carried out by national and international experts, which highlighted that “the Republic of Moldova needs a more transparent and fairer system.”

The Minister of Finance specified that the draft is to be submitted to public consultations, in order to be examined with all interested parties. The authorities aim for the higher salaries to be applied starting in the autumn of this year.


“Now public consultations will follow, with the draft to be discussed with all interested parties. Our objective is that already from this autumn this law will be in force and we will have the first corrected, adjusted salaries. We are convinced that this draft law will improve and significantly increase the quality of the public service in the Republic of Moldova and provide the services our citizens deserve,” concluded Andrian Gavriliță.


Public consultations on the draft will take place until 2 July. The reform will be implemented gradually until 2032, with an interim evaluation in 2029, and is aligned with the objective of budgetary sustainability, including keeping the wage bill within the limit of up to 9% of GDP.