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Public statement regarding the degradation of the legislative process and the governing act in the Republic of Moldova

21 December 2020

The National Civil Society Platform within the Eastern Partnership condemns the unprecedented degradation of the quality of the governing act as a result of non-compliance with the legal procedures for the promotion of draft laws committed by the parliamentary majority, formed by the Party of Socialists from the Republic of Moldova, the Şor Party and the group "for Moldova". During the Parliament sessions of December 16, 2020 and December 3, 2020, in flagrant violation of legislative procedures, these parties adopted a series of laws that compromise the fight against corruption, undermine the public budget, endanger the relationship with development partners and risk destabilize the macro-financial situation in the country. Thus, in addition to the concerns expressed in the public appeal of December 7, 2020, we draw the attention of society, national authorities and the international community to the following toxic acts and decisions that generate imminent risks to financial, political, economic stability and security omics and social from the Republic of Moldova: Repeal of the "Billion Law" 56 deputies of the PSRM, the Şor Party and the parliamentary group "for Moldova" adopted the bill for the repeal of Law 235/2016. Through this vote, the mechanism for reimbursement by the Ministry of Finance of the emergency loans offered by the NBM to the three bankrupt banks (BC Banca de Economii; BC Banca Socială and BC Unibank) during the years 2014/2015 was cancelled. The vote was carried out in violation of all the requirements of transparency and consultation in the decision-making process of the relevant institutions. More than that, the repeal of Law 235/2016 creates imminent risks to public finances, macroeconomic balances within the national economy and undermines the trust of external partners and international financial institutions towards the state of the Republic of Moldova. The cancellation of the debt of the Ministry of Finance to the National Bank of Moldova will lead to the undercapitalization of the NBM, making it unable to exercise its duties conferred by law: ensuring price stability and confidence in the national currency. This rather rapid fact would worsen the financial position of companies and citizens, as well as the stability of public finances in the context in which the government will have to contract new debts in order not to allow the escalation of a social crisis. Moreover, it will undermine the confidence of investors in the state, which will make the process of attracting loans and investments, especially foreign ones, even more complicated. The repeal of Law 235/2016 risks causing chaos in the economy and society, but it seems that this is precisely what the deputies have proposed to achieve their narrow group interests, including the rescue of those guilty of bank fraud. The return to the retirement thresholds of 57 years for women and 62 years for men Parliament approved in the final reading the draft law to amend Law no. 156/1998 on the public pension system (art. 41, 42). The essence of this law is the lowering of the retirement age until 2016, when the gradual increase of the retirement age (57 years for women and 62 years for men) resumed. Although the project addresses a subject with a massive social and budgetary impact, it was promoted with a total lack of transparency, without public consultations and without obtaining all the necessary approvals from the institutions involved, especially the Government, from its registration to the final vote passing only 6 days. The superficiality of the argumentative note also stands out, which offers ZERO calculations on the budgetary impact of this project, although the implementation of this measure may cause the bankruptcy of the public pension system. The most conservative calculations show that only for the year 2020, approximately 1.4-1.5 billion lei would be needed in addition to the budget, and for the following years the pressure on the budget will increase several times considering the increase in the number of people who will reach the low age of retirement. In other words, the conjuncture parliamentary majority PSRM-Şor voted to lower the retirement age without communicating to society and what its costs would be, and these can be dramatically reflected by: i) increasing the fiscal pressure on companies and employees by substantially increasing contributions of social security, ii) stopping any pension increases and even forcing to reduce pensions, in order to be able to pay them, iii) limiting to the maximum the expenses for investments from the state budget in order to be able to compensate the deficit of the pension fund through transfers. Although the pension reform of 2016 was not a perfect one, it allowed by recalculating / updating / valorizing the pension for many categories of pensioners that within 4 years the average pension would increase from 1,275 to 2,050 lei, and in the absence of this reform the average pension would have been about 500 lei lower at the time. If in December 2016 the monthly expenses of the pension fund er have 881 million lei, in September 2020 their volume was over 61% higher (1.4 billion lei). The authors of the project brought as examples of the retirement age states from another geographical area, or with a fundamentally different demographic situation, such as Sri Lanka, but they forget to mention that in most of the states in the region the phenomenon of population aging forced the states to raise the retirement age retirement, even the Russian Federation, which the PSRM frequently refers to, is currently in the process of raising the retirement age from 55/60 years to 60/65 years. In conclusion, by adopting this populist project and without budgetary coverage, the PSRM-Şor deputies give the population the false illusion that they will retire sooner, but they do not say that by doing so they are condemning retirees to miserable pensions and an insecure old age. More than that, the cancellation of the pension reform endangers the potential of the Government of the Republic of Moldova to access external funds requested from the International Monetary Fund, the European Union and other development partners. Approval of the Fiscal and Customs Policy and the Budget Law for 2021 by the Parliament The most important annual decision of the Parliament - the approval of the fiscal/customs policy (Law no. 476 of 01.12.2020) and the State Budget Law - took place this year without complying with the minimum legal requirements of transparency, in the absence of consultations and with the inclusion of provisions that promote narrow political interests. During the adoption of the State Budget (October - December), Parliament has the obligation to ensure a sufficient level of information, consultation and participation, to ensure that this document responds to existing priorities, but above all to ensure parliamentary control of the way in which public money is spent. The drafts of the Fiscal/Customs Policy and the State Budget Law 2021 were sent to Parliament by the Government on December 1, 2020 and no genuine parliamentary discussions were organized on them, the document openly promoting political clientelism, all this, in the absence of resources to cover of expenses, in gross violation of the provisions of the Law on Public Finances and Budgetary-Fiscal Responsibility and the Parliament Regulation. One of the most eloquent examples is the distribution through Annex 7 of the State Budget Law of over 350 million lei with a discriminatory and dangerous political discretion. Apart from being a bad example of the abuse of deliberative power in the state, the Parliament has given an extremely dangerous signal for the rule of law, where the abuse of the majority is legalized, undermining all the efforts of good governance and management of budgetary resources made since 2009 down to zero. Even worse is the fact that in the situation of the pandemic and the crisis associated with it, the changes made in the Parliament do not solve any of the current problems of the country: the increase in the unemployment rate, the problems in the health system, education, the real sector of the economy. The issue of capping local taxes remains a controversial topic, in the absence of a genuine dialogue and a platform to analyze the limitations these caps place on municipalities, but also of a deep misunderstanding of what the autonomy of local authorities means. Ignoring the common interest of the local authorities of the deputies, makes us believe that their lordships have forgotten that being elected by constituencies, they should represent their interests in Parliament as well. Amendment of Law no. 278/2007 on tobacco control The amendments to Law no. 278/2007 on tobacco control and the related amendments to this article in the budget-fiscal policy are only a special mechanism to circumvent the cigarette taxation system. There is no reason to explain why for this new type of cigarette "cigarillos" the excise duty paid must be at least 2 times less than the cheapest cigarettes on the domestic market. This product is as harmful as any tobacco product, with the same degree of toxicity and which can cause addiction, is not a "social product", and the premise that the change corresponds to the European acquis is a false one. Modification of the operating framework of the National Integrity Authority Parliament adopted in two readings on the same day a draft law that modifies the operating framework of the National Integrity Authority. The project was initiated on December 4, 2020, less than two weeks before adoption, by a group of socialist deputies. The project reduces the term for carrying out the control of wealth and personal interests from 3 years to 1 year from the termination of the position/mandate; introduces ambiguities regarding the term for contesting the acts of the National Integrity Authority and conditions the disciplinary responsibility for not declaring assets on the existence of a definitive act of the National Authority of Integrity etc. In essence, the project reduces the ability of ANI to verify civil servants and introduces even greater chaos into the procedure for verifying assets and sanctioning state employees. This fact in itself is hard to accept in a state that declares the fight against corruption as an absolute priority. The bill in question does not address a burning issue, but it was adopted in great haste. Also, it was voted in violation of legal procedures (lack of Government approval and anti-corruption expertise) and public consultations. The haste with which such a sensitive project was voted betrays the existence of hidden interests. The changes in the pharmaceutical field The legislative changes made on December 16 by the PSRM-Şor majority in the field of pharmaceuticals and drugs, adopted without consensus and consultations with the pharmaceutical community in the country and which de facto remove the natural rigorous control of pharmaceutical activity, come to undermine this sector and direct attention to people's health. The liberalization of the prices of non-prescription drugs may inevitably lead to price increases in a market that is still far from a transparent one with a favorable competitive environment, while limiting the commercial mark-up for compensated drugs to 12% will lead to the gradual disappearance of their pharmacies resulting from the definite economic disinterest to sell under such conditions, especially for small pharmacies without economies of scale. But the epic of destructive changes in this sector do not stop here. The change that will allow the sale in the Republic of Moldova of drugs not authorized in the country of origin, which have not passed the conformity and harmlessness test, as well as the introduction of the possibility to sell drugs outside pharmacies, creates all the prerequisites for the population to purchase widely dubious products with potentially serious consequences for human health. Added to this is the possibility of selling medicines in so-called mobile pharmacies, which obviously could not respect the optimal conditions for keeping medicines. Moreover, they will be marketed by people without the necessary training, and the impossibility of effective monitoring of these units also opens wide the possibility of unimpeded marketing of falsified and counterfeit medicines. In conclusion, guided by populist electoral promises and narrow business interests, the PSRM-Şor parliamentary majority shamelessly puts people's health to the test in order to fulfill their own interests. In the context of the above: We qualify these and other concerted actions of the deputies from the PSRM parliamentary majority, the Şor Party and the group "for Moldova" as institutional sabotage aimed at destabilizing the macro-financial, economic and social situation of the Republic of Moldova, in an irretrievable way for several years forward. We request the deputies to notify the Constitutional Court regarding the constitutionality of the acts adopted by the Parliament of the Republic of Moldova, considering the violations and serious procedural errors admitted. The respective laws were voted in haste, without consultations, most of them without the favorable opinions of the relevant institutions. We urge the members of parliament to strictly respect the law, the will of the people and refrain from promoting initiatives that undermine the rule of law, the independence of public institutions, democracy and the country's foreign relations, as well as encourage the promotion of obscure schemes to the detriment of i national interests and objectives. We urge the Parliament of the Republic of Moldova to fully exercise its function of parliamentary control, to respect the principles of decision-making transparency, not to accept for approval documents that did not respect the legal procedures for consultation with the public, the National Platform of the Eastern Partnership Civil Society Forum was created in 2011 and currently has 96 member organizations, 7 of which are umbrella organizations for over 255 other organizations. The mission of the Platform is to strengthen the process of European integration and democratic development of the Republic of Moldova, to contribute to the advocacy and monitoring process for the implementation of the Association Agreement between the Republic of Moldova and the European Union, and other relevant documents that refer to the Eastern Partnership and the Republic's relationship Moldova with the European Union. Signatories of the Declaration: 1. Association for Participatory Democracy ADEPT 2. Soros-Moldova Foundation 3. Center for Independent Journalism 4. Urban Development Institute 5. Independent Press Association 6. Promo-LEX Association 7. Amnesty International Moldova 8. European Studies Institute Policies 9. The International Center for the Protection and Promotion of Women's Rights "La Strada" 10. The Institute for Human Rights 11. A the network of NGOs active in the field of Child and Family Social Protection 12. "Ave Copiii" 13. Legal Resource Center from Moldova 14. National Roma Center 15. Institute for European Policies and Reforms 16. Independent Analytical Center Expert-Group 17 Union of Disabled Organizations of Moldova 18. WatchDog.md Community 19. Local Democracy Agency Moldova 20. INVENTO 21. Experts for Security and Global Affairs (ESGA) 22. National Association of Paralegals from Moldova 23. Center for Training and Educational Development 24. Association for Efficient and Responsible Governance 25. Association for the Rehabilitation of Invalids from the Republic of Moldova 26. Alliance of Organizations for Persons with Disabilities 27. INFONET Alliance 28. Institutum Virtutes Civiles 29. Медиа Центр Приднестровья 30. Center for Policies and Reforms 31. Institute for Development and Social Initiatives "The Future" 32. Alliance of Small and Medium Enterprises from Moldova 33. Women's Association Professional and Business Women from Moldova 34. Congress of Local Authorities from Moldova 35. Association for Foreign Policy 36. INTECO 37. "Mothers in Action" 38. "Woman and Child - Protection and Support" 39. "Pro-Europe" Center from Comrat 40. Regional Center for Sustainable Development from Ungheni 41. National Association of European Trainers from Moldova 42. "Contact" Balti Regional Center 43. Youth Initiative Group for the Future 44. Information and Support Center for Young Economists "CERTITUDINE" 45. National Center for Assistance and Information of NGOs from Moldova CONTACT 46. "Pro Regional Cooperation" 47. Association of Small Business from Moldova 48. Center for Development and Management 49. Center for Economic Development and Public Affairs 50. Business Consulting Institute 51. LEADER National Network in Moldova 52. "Terra-1530" 53. Women's Association for Environmental Protection and Sustainable Development 54. Cahul Ecological Consultancy Center 55. BIOS 56. ECOTOX 57. The Ștefan-Vodă Territorial Organization of the Ecological Movement of Moldova 58. The Regional Environmental Center of Moldova 59. The Association for the Valorization of Waste 60. The Ecological Movement of Moldova 61. "Let's Moldova" 62. The Regional Center for Environmental Studies ECOS 63. The Republican Center for Children and Youth Gutta-Club 64. International Association of River Keepers "Eco-Tiras" 65. "Cutezătorul" 66. "Caroma-Nord" 67. Eco-Contact 68. "BIOTICA" 69. National Center for the Environment 70. Alliance for Energy and Renewable Efficiency 71. Automobil Club Moldova 72. Eco-Sor 73. GREEN-School 74. Development Training Institute "MilleniuM" 75. National Youth Council of Moldova 76. "Youth for the Right to Life" (TDV) 77 East European Foundation 78. Agency for Cross-Border Cooperation and European Integration 79. "Eco-Răzeni" 80. Institute of Public Policies 81. Foundation for Development from the Republic of Moldova 82. "Interaction" 83. Foundation for Education and Development of n Moldova 84. AEGEE-Chisinau 85. Innovation and Policy Center from Moldova 86. CASMED 87. Regional Association of mothers with many children and women-entrepreneurs from Gagauzia "VESTA" 88. European Center for Civil Initiatives "Stalker" 89. Platform for Active Citizenship and Partnership for Human Rights (CAP) 90. Labor Institute 91. National Confederation of Employers from the Republic of Moldova 92. National Confederation of Trade Unions from Moldova 93. Federation of Trade Unions in Construction and Construction Materials Industry SINDICONS 94. Trade Union Federation " HEALTH" from RM 95. Center for Analysis and Prevention of Corruption