Bulgarian Parliament passes Budget revision at first reading
With opposition party GERB back on Parliament’s benches, Bulgaria’s lawmakers passed the proposed Budget revision on July 25 after a day-long debate. The vote passed with 115 votes in favour coming from the ruling coalition, 88 against and 10 abstentions.
After the sniping between ruling coalition MPs and GERB in the morning session, the heated exchanges continued in the afternoon, albeit with the focus shifting from the anti-government protests to the main item on the agenda, the Budget revision, with neither side willing to concede any ground.
Prime Minister Plamen Oresharski and Finance Minister Petar Chobanov both underscored the need for the revision in order to speed up government payments to the private sector, accusing the GERB government, which resigned in February, of allowing the debt pile-up – a charge that former deputy finance minister Vladislav Goranov and former National Revenue Agency director Krassimir Stefanov, who are now GERB MPs, denied.
Oresharski and Chobanov also rejected the claims that the one billion leva increase in the annual borrowing ceiling was done in order to boost government spending that would go to companies with close ties to the two parties in the ruling coalition.
The draft bill envisions increasing the Budget deficit by 493.4 million leva, raising the deficit target to two per cent of gross domestic product (GDP), which will still keep Bulgaria well short of EU’s three-per cent deficit ceiling. (For more details on the Budget revision bill, see The Sofia Globe report here.)
Alongside the opposition parties, economic policy think-tanks in Sofia have argued against the revision, saying that the revenue shortfall this year, expected by the Plamen Oresharski administration, was not sufficient grounds for a Budget revision.
Initially, Oresharski said in a memo accompanying the revision bill that the Cabinet expected a shortfall of 293 million leva, the rest of the deficit increase coming from increased spending to cover overdue payments to the private sector and benefit hikes.
But on July 22, Chobanov said that the revenue shortfall was seen at 207.4 million leva, with 286 million leva to be spent on top of what is currently envisioned in the 2013 Budget.
Going forward, Parliament’s committees are expected to review the bill again in the coming days, with the second reading vote expected next week.
(Photo: Clive Leviev-Sawyer)