No Budget, Big Consequences: Fiscal Council Flags Risks as Bulgaria Prepares for Extension Law
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Bulgarian Govt Adopts 2013 Budget, Projects 1-2% GDP Growth
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Bulgarian Finance Minister and Deputy PM Djankov (left) with PM Borisov. Photo by BGNES
Bulgaria's Cabinet has adopted the draft 2013 State Budget Act proposed by the Finance Ministry as well as additional legislation for upping the minimum salary, and the budget of the National Health Insurance Institute.
"We have made conservative calculations for next year's budget based on 1.2% GDP growth even though we actually expect the Bulgarian economy to grow by 1.9%," Bulgaria's Finance Minister Simeon Djankov told reporters after the weekly meeting of the government on Wednesday.
He added that the 2012 State Budget Act was based on a 1% GDP growth projection, which is why Bulgaria is ending 2012 with slightly better financial results than projected.
"The IMF forecasts 1.5% economic growth for Bulgaria in 2013, the World Bank – 1.6%, the European Commission – 1.8%, the Association of European Commercial Banks – 2.5%," Djankov noted futher.
Bulgaria's 2013 state revenues is expected to be BGN 1.8 B greater than it was in 2012, while the deficit is expected to be 1.3% of the GDP, amounting to BGN 1.1 B, about the same nominal amount as in 2012.
Bulgaria's state spending in 2013 is estimated at BGN 31.648 B (38.8% of the GDP), an increase by BGN 1.804 B compared with the 2012 state budget; this spending factors in Bulgaria's contribution to the common EU budget, which is estimated at BGN 908 M, an increase by BGN 12.5 M.
Bulgaria's state revenue in 2013 is projected at BGN 30.548 B (37.5% of the projected GDP), up by BGN 1.796 B compared with the 2012 budget.
Bulgaria's 2013 State Budget Act also provides additional BGN 790 M for social spending, including BGN 586 M more than was provided in the 2012 budget for increasing retirement pensions as of April 1, 2012; BGN 135 M more for unemployment and social benefits; and BGN 72 M more for employment programs.
Bulgaria's education sector will receive BGN 120 M more funding from the state in 2013, while the culture sector will get BGN 31 M more that it got in 2012, according to the draft document. The state spending slated for infrastructure is up by BGN 510 M year-on-year.
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