June 17, 2010

At its sitting, on June 17th 2010, the National Assembly approved at first reading amendments to the State Budget Act for 2010.

The update of the 2010 State Budget stipulates expenditure cuts, the fiscal reserve reduction to BGN 4.3 billion, providing at the same time additional funds for health care, social activities and for the tobacco producers in the country. The amendments restrict by 20 per cent the non-interest expenses of state bodies, ministries and departments as well as the transfers due from the central budget. The amendments are targeting 1 per cent growth of the economy by the end of the year. The level of indirect and direct taxes remains the same.

The changes propose an increase of the total expenditures, transfers and contributions to the European Union by BGN 254.8 million. The budget transfers to the municipalities will be reduced by 20 percent for the remaining part of the year or with BGN 138.2 million; for state universities - with 76.9 million; for the Bulgarian Academy of Sciences - with 14.9 million; an additional appropriation of BGN 10 million is envisaged for the National Health Insurance Fund.

Appropriations to the state reserve for unexpected and urgent expenditures are to be increased by BGN 1 142.5 million. The budget allocates funds to cover the unpaid contractual debts of the state from previous years at the amount of about BGN 660 million; to finance infrastructure projects of national priority such as highways,road junctions, etc., the budget provides BGN 180 million and BGN 116 million are allocated for tobacco producers' premiums. For social payments the budget plans additional BGN 142 million and for the National Railway Infrastructure Company – BGN 45 million.

The Deputy Prime and Finance Minister Simeon Djankov said before the vote that 16 EU countries have already revised their budgets, forced by the economic and financial crisis. He said Bulgaria is not alone in this respect. Simeon Djankov added that the update, around 15 June 2010, was presumed at the time when the 2010 State Budget Act had been adopted, back in 2009.

At the beginning of the plenary sitting the parliament terminated the powers of Stoyan Mavrodiev who was appointed earlier as Chairman of the Financial Supervision Committee.