Romanian government likely to survive junior coalition partner’s challenge

The Romanian government will not fall. PM Citu’s departure is possible but unlikely. 

WHAT’S HAPPENING: 

After the relatively calm summer days, Romania is back with what appears to be a serious government crisis that could prove to be the undoing of PM Citu. 

The immediate reason behind the crisis is the unexpected removal of justice minister Stelian Ion (USR-Plus), initiated by PM Citu late last night, citing irreconcilable conflict regarding the National Programme for Local Development (PNDL), a RON 50bn (EUR 10bn) rural development plan proposed by the smallest coalition partner UDMR and supported by PNL. 

USR-Plus tied support for the programme to the inclusion of certain projects that are important for the party, a condition PNL did not accept. So justice minister Ion, whose consent was required to adopt the programme, refused to sign off on it, prompting Citu to sack him. In response, USR-Plus co-presidents Dan Barna and Dacian Ciolos announced that “there is no more coalition with Citu as PM.” 

WHAT’S NEXT: 

USR-Plus will initiate negotiations about a new PM later today at a coalition meeting. If no agreement is reached, the party has threatened to support a no-confidence motion against the government, but this is unlikely to come to pass – even though, in order to add force to the threat, the collection of signatures for the motion has already begun. More talks and horse-trading, with the PM’s position and many others on the table, are likely. Ion’s temporary replacement, interior minister Lucien Bode (PNL) will no doubt support the PNDL, allowing it to pass on Friday, further angering USR-Plus. But Citu’s position within PNL remains strong, and time is on his side: coalition members will now have more than a week to come to an agreement, as USR-Plus will only decide on the next steps at its 11 September meeting. That is plenty of time to negotiate a deal that allows Citu to remain PM but satisfies some key demands of USR-Plus, such as full autonomy over the justice reform. Furthermore, even if a no-confidence motion were to pass, President Iohannis could again nominate Citu to form a government, allowing yet more time to renegotiate the terms of the coalition. 

BASELINE SCENARIO: 

As all parties involved are interested in staying in power, we expect that the government remains intact. The most likely outcome (70%) is that Citu stays on as PM; this would require significant concessions to USR-Plus, probably including (apart from the justice reform) considerably more influence over public investment. In a possible but unlikely scenario (30%), PNL strongmen would back out from behind Citu and he would be forced to resign. Ludovic Orban would then be his most likely successor, but President Iohannis’ opposition to him would be a key risk to his appointment. 

ANALYSIS: 

Citu’s miscalculation was the immediate fuse that set off the crisis, but his desire for unfettered control will continue to pose a risk to the government’s stability. The prime minister wanted to push the PNDL through before the PNL congress, we understand, as it would have meant large sums for PNL-led municipalities. He miscalculated the anger this would cause within USR-Plus, a party with strong urban presence but virtually no rural strongholds and very few rural mayors. However, USR-Plus and PNL sources both confirm that the conflict between Citu and Ion goes back several weeks, as the minister has consistently refused to bow to pressure from PNL to appoint “the right people” to vacant positions at the Anti-Corruption Prosecutor’s Office and at the Directorate for Investigating Organised Crime and Terrorism (DIICOT). This points to Citu’s desire for unfettered control over his government – an implausible goal within the context of the coalition, and one that is likely to remain a risk to the government’s stability going forward. 

USR-Plus is flexing its muscles to demonstrate strength to its membership, to achieve key policy objectives, and to attempt to remove Citu, but not to leave the government.

  1. The party does not want to leave the government; this has been confirmed to us by several USR-Plus sources. Given the party’s underwhelming poll figures and the chance that an early election would cost it many seats and force it into opposition, with a PSD government (and the chance that USR-Plus’ electorate would blame the party for PSD’s return to power), this makes sense. 
  2. The party wants to show strength. There is palpable frustration within party as their second minister (after health minister Vlad Voiculescu, in April) was sacked without any notice and as key policy objectives, such as the cleanup of public administration and the introduction of a transparent system for new appointments, are seen as being sabotaged by PNL. Like PNL, USR-Plus is due to hold a congress within a month; both co-chairs are keen to show they are doing their best to push the party’s agenda within the government. 
  3. The USR-Plus leadership would like to see Citu go. They believe a PNL led by Orban would spell better cooperation and more opportunity for USR-Plus to grow. 

Citu’s position within PNL remains strong – strong enough to call USR’s bluff and remain in office. Although we are told that Orban and his most committed supporters boycotted the party’s leadership meeting this morning, and a number of PNL MPs have called on Citu to resign before the government falls, most of the party’s strongmen and a large majority of congressional delegates remain behind the PM. 57 officials present at this morning’s meeting (including many who have declared support for Orban at the congress) have unanimously voted in support of Citu. There is therefore no immediate pressure on Citu to resign. This will allow him to call USR-Plus’ bluff: remain in position, wait and see what steps USR-Plus takes, calculating that the party will not risk forcing an early election which could prove to be its political death warrant.