Bulgarian railway syndicates have opposed vigorously the terms of a loan memorandum that the government signed with the World Bank, and declared determination for all-out strikes.

The framework memorandum inked Wednesday in Sofia outlines the conditions for understanding between the Bulgarian government and the World Bank under which Bulgaria will get about BGN 600 M in loans for its troubled state railway companies in exchange for harsh reforms.

"We declare that the stipulation in the memorandum for "a 30% reduction of the spending for personnel" is unacceptable," states the position of the two major Bulgarian railway syndicates with respect to the agreement between the Cabinet and the World Bank.

According to the unionists' statement, the reforms to which Bulgaria is committing to get the World Bank money for the state railway operator BDZ and the National Company "Railway Infrastructure" (NKZI) will cause massive layoffs with thousands of workers losing their jobs.

Furthermore, the syndicates say this "will reduce the staff of the railways to the bare technological minimum, which will create a direct threat to the safety of railway operations, and the life and health of the Bulgarian citizens and the country's national security."

The two major railway syndicates, which are part of the larger Bulgarian trade unions – the Podkrepa Labor Confederation and the Confederation of Independent Bulgarian Syndicates (KNSB) – are said to have had "long and hard talks" with representatives of the Transport Ministry, the Finance Ministry, the World Bank and the IMF on December 14 and 15 about the memorandum. The talks were held at the request of the syndicates but apparently did not satisfy their demands.

"The railway workers will strike to the very end if the text of the memorandum for the World Bank loans is not amended," declared the head of the KNSB railway syndicate Petar Bunev.

Bunev believes that the some BGN 600 M that the Bulgarian government will get in loans from the World Bank for the railways will go primarily to cover old debts of the state companies, and very little of that money will trickle down for actual investments.

The Bulgarian governments in the past 20 years have been unwilling to try to privatize the railways because of the strategic importance of the railway sector, and the concerns that a private owner would shut down unprofitable routes, and will lay off thousands of people.

Even though the company has seen very little investment over the past 20 years, and its speeds are slow, and many trains are in a bad condition, and it has also been reported to be used for draining state money by senior officials on a number of cases, it has been maintained by the government with subsidies and transfers from the state budget as a kind of a welfare state service to keep this means of public transport accessible and affordable.

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