Bulgaria's parliament approved on Thursday an unprecedented end-of-year government spending spree of BGN 1,2 B, which the cabinet can spend as it sees fit.

The Socialist-led cabinet of prime minister Sergey Stanishev said it plans to use the funds from the budget surplus to finance new transport and environmental infrastructure, as well as for ongoing investment projects.

It initially asked for BGN 570 M, later raising its demands to BGN 700 M, arguing it could afford to given the robust revenue collection this year. A new proposal lodged by MPs on Wednesday further upped the figure to BGN 900 M.

Additionally, the cabinet can spend up to 1,5% of planned revenue from the surplus without asking the parliament's approval, which comes up to another BGN 300 M.

The MPs from the ruling coalition also voted down a proposal by the opposition to spend part of the budget surplus on a Christmas bonus to state employees, equal to a full monthly wage.

Bulgaria's budget surplus for the first nine months of the year reached a record BGN 3,05 B, data released by the country's cabinet earlier this month showed.

A chunk of that money will be spent on addressing commitments undertaken by Bulgaria when it joined the EU, such as setting up emergency centres for monitoring all distress calls and boosting the country's crude oil reserves.

The cabinet also plans to extend some funding to local administration as interest-free loans.

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