Mayor Fandukova: Sofia to revise budget, aid SMEs

Written by on April 2, 2020 in Bulgaria - Comments Off on Mayor Fandukova: Sofia to revise budget, aid SMEs

Sofia mayor Yordanka Fandukova said on April 2 that the first package of proposed measures to assist small and medium-sized businesses, which are most affected by restrictive orders to combat Covid-19, is ready.

Fandukova said that she would table proposed amendments to Sofia’s 2020 budget in the city council.

The package of measures to aid SMEs is intended to help the most-affected sectors, she said in a Facebook post. The measures include a tax package, a package of administrative services, a review of all the municipality’s financial instruments with the goal of supporting more freelancers and measures to support particularly affected sectors in the Sofia economy, she said.

The report was drafted together with economists Krassen Stanchev, Luchezar Bogdanov and Petar Ganev from the Institute for Market Economics, Georgi Angelov from the Open Society Foundation, Ivan Neikov, Roumen Draganov from the Institute for Analysis and Assessment in Tourism and Nadia Shabansko of the Bulgarian Centre for Not-for-profit Law.

The expert report is being given to a working group which includes representatives of all political parties in the city council.

“I am already working on the second part, which I will also present to them. It is about the impact of the crisis on the revenues and expenditures of Sofia municipality and the need to update our budget,” Fandukova said.

The restrictions imposed to contain the spread of Covid-19 had had a severe impact on planned revenue and had affected activities that were strategic to the municipality – such as urban transport, cleanliness, health care and social services.

In March alone, local taxes and fees collected had dropped by 19 million leva.

Urban transport’s losses in March added up to six million leva in reduced earnings, mainly from decreased ticket sales and the fact that fees were not being charged for the blue and green parking zones.

The losses of the three municipal transport companies added up to 6.5 million leva, while the municipality was also preparing a statement of losses in municipal hospitals and clinics.

“Together with economists, we are preparing an estimate of the amount of revenue we can expect in the coming months, as well as the additional costs we will undertake. Based on this information, I will propose an update to Sofia’s 2020 budget,” Fandukova said.

“The direction in which we are working is to reduce the total cost of certain activities and to reduce the planned investment programme,” she said.

The investment programme would be amended, and not stopped.

Strategic projects for the city would continue. These included construction to expand the metro underground railway system, construction of internal rings and connections with the Sofia ring road, waste management, construction of new kindergartens and construction of a contemporary art centre for freelance artists.

There would be completion and implementation of European projects that guarantee a significant amount of external funding that is invested in the city and business, Fandukova said.

She said that recent claims that these projects that the municipality could stop these projects and redirect the money were “misleading and false”.

“Suspension of these projects means the loss of a currently guaranteed financial resource for Sofia and the payment of huge financial penalties,” Fandukova said.

“With responsibility, financial discipline, and last but not least, unity, we can handle this heavy blow to our city. And in a way that Sofia continues to be an engine of the country’s economic development,” she said.

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