As one of Europe's poorest countries, Romania has a hard enough time paying its pensioners as it is, without the added strain of an aging population.

But a decade of stalled reforms since the fall of communism has made a crisis ever more likely as tax evasion mounts and lax criteria for calculating benefits keep adding to the bill.

There are now 50 per cent more pensioners than registered workers in Romania, a phenomenon other European countries do not expect to have to worry about for years, and unless the system is overhauled soon it could be bankrupted in the near future.

"Romania has the highest social security taxes and the worst dependency ratio in the region, so resources for the present pension system are almost exhausted," said independent analyst Florin Petria. "Faster reforms are absolutely compulsory."

Officials concede they have left it late to do something but say that new measures announced a year ago were a serious start.

Not so, say many analysts, arguing that the plans in place so far just defer the difficult decisions which could make them unpopular, turning the process into a classic Romanian farce.

"It's like a play by Ion Luca Caragiale, our master of the comedy of manners," said one analyst who asked not to be named. "Everyone wants reform so long as not too many things change."

Labour Minister Marian Sarbu insists he is serious about dealing with an issue already tackled in much of eastern Europe.

"After 11 years, we've got started now and resisted the pressure to delay reforms again," he told Reuters, stressing that a law passed last year will raise the retirement age and close major loopholes in the way pensions are calculated.

The analysts say more work is needed to overhaul the system's state-run "first pillar" while its key "second pillar", managed by private firms, and an optional third fund will remain mere ideas until much-needed economic restructuring takes place.

"This reform requires a sea change in fiscal policies and the current obsolete budget philosophy," Petria said.

It is already too late for Dan Scurtulescu. Like many of Romania's 6.5 million pensioners, who on average pocket $45 a month in old-age benefits, the 65-year-old former music teacher once thought retirement would bring him a peaceful life.

"I now have two part-time jobs because my pension is absolutely insufficient to live in dignity," he said.

Romanians earning the average monthly wage of about $100 already struggle to pay their rent and utility bills, while pensioners are even more vulnerable, particularly in winter.

"I don't know how I'd survive if my children weren't helping me," said Domnica Anghel, 72, who used to work as a clerk at Bucharest city hall. "Others are nearly starving."

Worries about alienating older voters have stymied efforts to reform the system - especially when it requires funnelling a chunk of pension contributions to private funds, restricting the freedom of politicians to curry favour by putting up payments.

A decade of stalled reforms and rising corruption have made the problem even more acute. With the black economy now at least half as big as the legal one, the number of pension contributors has slumped by a third while two thirds more people are now drawing benefits, stretching meagre funds even further.

The government postponed the introduction of privately-run universal pension funds last year after financial scandals at several unit trusts and banks eroded popular confidence in them.

And although it has pledged to put the policy into action soon, together with rules governing the non-compulsory third pillar, universal funds are unlikely to appear before 2004, when a general election could give politicians cold feet again.

"Overhauling pensions hinges on political will, which has to stop being dependent on the electoral cycle," Petria said.

One of the consequences of this electioneering has been a distortion in pension payments, leaving those who retired in the early 1990s worse off than many who have done so since because of changes in the computation method to boost their payments.

Since last April's law was passed, putting new recipients on an equal footing, the government has been trying to iron out these discrepancies by recalculating pensions, which analysts warn will limit the money available for more important reforms.

A World Bank study showed that overhauling the system before doing a series of upward reassessments would have generated some years of modest budget surpluses, while analysts stress that doing it the other way round will create long-term deficits.

"The key problem is the sustainability of reassessment," said Tudor Moldovan of the insurance company Generali. "It puts a fresh burden on the current system."

Even efforts to improve the collection of social security taxes - currently an oppressive 58 per cent - cannot offset this and the development of a private pension pillar will put additional strain on the budget because of the tax breaks it involves.

The slow progress has also prevented reforms from spurring a revival of Romania's meagre savings rate and sluggish capital markets, restricting the growth of financial services.

Few of today's pensioners, weary of enduring poverty and deeply cynical about politicians, expect anything to change.

"Pension reforms are pure propaganda," Scurtulescu said. "If I were in my 40s again, I'd be very scared about my future."