'Progressive Bulgaria' Withdrew Its Proposal for New Debt

The governing parties have withdrawn their proposal for nearly €4bn in new government borrowing after opposition parties argued that such a request can only be submitted by the Ministry of Finance. However, members of the parliamentary Budget Committee warned that there is an urgent need for funding to cover pension payments as early as July and urged the Finance Ministry to submit a request for debt modification

What happened to the other two measures proposed by the governing parties yesterday?

MPs approved a reduction in the state subsidy paid per valid vote from €4.09 to €3. They also approved a freeze on the Covid supplement paid to pensioners. The first measure is expected to save €2.2m in the state budget, while the second is projected to save €30m, or €5m per month.

The measure, however, was strongly criticised by the opposition.

Temenuzhka Petkova, GERB–UDF:
This is about a right that pensioners have acquired by virtue of legislation and we are categorically against taking away rights that have already been acquired."

Asen Vasilev, We Continue the Change:
“The package you are proposing is to take one euro from the parties and 2.39 cents from every pensioner. And you are saying that by taking 2.39 euros from every pensioner, we will balance the budget. I will not use any vulgar words, but I believe this is neither statesmanship nor politics.”

Aiten Sabri, MRF:
“The consequences of the Covid crisis are still being felt, and medicines have not become cheaper. When a pensioner goes to collect their pension at the post office branch, they allocate it for electricity, water, cheese, and everything else.”

However, the government disagreed with the opposition and explained that instead of a Covid supplement, they would propose a future allowance linked to the Iranian crisis as part of a forthcoming package, although it would not be incorporated into pensions. They also confirmed that the 7.8% increase in all pensions under the Swiss indexation rule from July would remain in place.

Konstantin Prodanov, Chair of the Temporary Budget Committee:
“We are not waging a war against Bulgarian pensioners – quite the opposite. Despite all the financial commitments inherited from previous governments, which are among the reasons why the European Commission is now placing us under an excessive deficit procedure, we still stand behind this commitment to update pensions.”

Stefan Belchev, Progressive Bulgaria:
“These are our mothers and fathers, after all, so at no point would we allow them to be disadvantaged in any way. What we have here are certain distorted arrangements that simply need to be brought to an end.”

Democratic Bulgaria advised the governing parties to present a comprehensive package of measures to control budget spending, rather than introducing changes piecemeal.

Martin Dimitrov, Democratic Bulgaria:
“We want measures to be taken, we want the deficit to be reduced, and we want to succeed. But with this approach, you are only creating public tension.”

The proposed reduction in party subsidies also sparked a heated debate in the committee. Once again, the opposition voiced its objections.

Tsoncho Ganev, Vazrazhdane:
“The parties outside parliament will suffer the most, as they also receive state subsidies. You are cutting them severely – very severely, to put it mildly. Secondly, you are penalising the opposition, whose combined subsidies are nowhere near yours.”

One of the Deputy Finance Ministers attended the committee meeting, but did not take the floor.

The committee also approved amendments to the Water Act, which provide for the consolidation of water utility companies and stipulate that household water prices should remain within socially affordable levels.