Parliament adopted the draft state budget for 2022 at first reading

After three hours of debate in the Parliament on February 10, the lawmakers adopted at first reading the draft state budget for this year with 129 votes in favour.

The debate on the budget texts started at 12.00. Deputy Prime Minister and Minister of Finance Assen Vassilev presented the main parameters of the financial framework.

"Expenditures have increased significantly compared to last year – realistically, given a debt of 4.5 billion BGN, we have an increase in spending by about 12 billion BGN, i.e.8 billion BGN are made with additional revenues to the treasury. On the one hand, the revenue agencies have done their job well and this year is the collection rate is set to increase. On the other hand, it means that Bulgarian companies and workers have earned extra money," Assen Vassilev said.

Vassilev pointed out that inflation rate may be revised in the subsequent budget update because in most cases it is imported, due to an increase in costs of imported products.

"Since we are in a currency board, the only thing we can do is to smile and expect measures to reduce inflation at the European Central Bank level," Vassilev explained.

The budget was fully supported by the ruling coalition. It was backed by "We Continue the Change", "There is Such a People", "Democratic Bulgaria" and "BSP for Bulgaria". The main criticism by the opposition GERB-UDF was that the budget relies on excessive spending, which will lead to a large deficit.

"This is a big greasy pizza box with no pizza in it," said Tomislav Donchev of the opposition GERB-UDF.

"There is pizza for everyone, but no pizza for the thieves," finance minister Assen Vassilev replied.

"For the first time we see a budget in which problems are not swept under the carpet," said Plamen Shalafov of “We Continue the Change”.

"There was criticism that we do not fit into the Maastricht criteria, you all know that these criteria are suspended until the end of the year at the EU level. Every macroeconomist knows that these criteria are impossible to meet in this situation," said Kiril Vassilev of “There is Such a People”.

The MRF, however, expressed doubt that the budget with its capital expenditure of BGN 8 billion is actually feasible.

"This budget is very important, it is more important than the budgets in recent years because of many circumstances. We have followed its drafting and its highlights very carefully. This budget is an investment budget, it is based on an increase in investment expenditure and economic expenditure and it is the most social budget, at least that is how it was presented. However, I doubt that all this can be implemented - especially in terms of capital expenditure and the expected return on it," said Yordan Tsonev from MRF.

"If the investments do not bring a return, I will accept your criticism, but to assume that there will be theft and the budget will not be implemented is wrong."

Vassilev explained that he would change the state policy completely, because at the moment investors come and ask if they will be racketeered, or if they will be shown who their subcontractor should be and who their accountant should be?

In response from GERB-UDF the floor was taken by Tomislav Donchev.

"In the governments I have been in, the results can be seen. It is very interesting - I have never been asked such things, you are talking about. I am concerned why you are asked such things?", Donchev said.

Rumen Gechev from BSP for Bulgaria made a comment. In his words, the strongest point of the budget is that it sets ambitious goals to bring change and growth to the economy.

"The structure of these increased expenditures is important, if they go to things and people who will immediately spend these funds, then we may see pressure on consumer prices. The important is that the entire deficit does not go to this," said Georgi Ganev of “Democratic Bulgaria”.

Serious criticism of the budget was voiced by former finance minister and current GERB-UDF MP, Kiril Ananiev.

"The draft budget and the updated budget forecast were developed and submitted without the new government having an approved governance programme. Now we are adopting a budget for the second quarter and we are waiting for the coalition partners to come to an understanding, this also brings unpredictability in the budget implementation. In this budget there is more for everything, higher and overestimated growth and GDP growth, more than necessary increase of the spending part, more deficit, more debt," said Kiril Ananiev of GERB-UDF.

In response, finance minister Assen Vassile commented that it was normal for the opposition to be against it because it was completely changing the model by which it allowed theft and Bulgarian society was not living well.

The budget was also criticized by “Vazrazhdane” party. Tsoncho Ganev from the party commented that the budget repeats the previous budgets and does not think that it will change the situation in the country. He also explained that there are not enough reforms in it.

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