implementing a clearly set medium-term fiscal programme so as to bring the general government deficit below the Treaty reference value of 3 % of GDP with a time-frame and a consolidation path which are consistent with the Council recommendations to Romania adopted under the excessive deficit procedure;

adopting and implementing annual budgets for 2010 and beyond, consistent with the consolidation path set out in the Supplemental Memorandum of Understanding;

reducing the public sector wage bill in nominal terms compared to the 2008 outcome by foregoing public sector wage increases (totalling 5 % in nominal terms) scheduled for 2009 (or equivalent further cuts in employment) and by reducing public employment, including by replacing only one of seven departing employees;

additional reductions in spending on goods and services and in subsidies to public enterprises;

improving the budgetary management by the adoption and implementation of a binding medium-term fiscal framework, establishing limits on budget revisions during the year, including fiscal rules and creating a fiscal council to provide independent and expert scrutiny;

reforming the public compensation system, including by unifying and simplifying the pay scales and reforming the bonus system;

reforming key parameters of the pension system by moving towards indexation of pensions to consumer prices rather than wages, gradually adjusting retirement age beyond the currently agreed plans, especially for women, and phasing in pension contributions of groups of public employees currently excluded from such contributions;

amending banking and winding-up laws to be able to respond in a timely and effective fashion in the event of bank distress. A key objective of the amendments will be to strengthen powers of the administrators of banks placed under special administration. Beyond bank resolution, the remedial powers of the National Bank of Romania (NBR) should be strengthened with provisions allowing it to request that significant shareholders increase their share capital and financially support the bank. Financial supervision will be strengthened in line with the relevant EU legislation. In addition, more detailed reporting requirements on liquidity will be introduced. Furthermore, procedures for the activation of deposit insurance should be modified to simplify and accelerate payouts. Under modified legislation, deposit insurance will be activated upon the NBR’s determination within the 20-day period. Finally, in order to guarantee sufficient liquidity provision, the NBR is committed to widening the range of assets acceptable as collateral. Considering the particular circumstances, the regulatory minimum level of the capital adequacy ratio should increase from 8 % to 10 % at an appropriate time;

Structural reform measures in the areas of the Country Specific Recommendations issued in the context of the Lisbon strategy. These will include measures towards improving the efficiency and effectiveness of public administration, enhancing the quality of public expenditure, sound use and increased absorption of EU funds, reducing administrative, fiscal and legal burdens on business and tackling undeclared work, thereby broadening the tax base.