BIA submitted to the National Council for Tripartite Cooperation its opinions on the draft budgets for 2023 of the Republic of Bulgaria, the Social Insurance Institution and the National Health Insurance Fund.
BIA submitted to the National Council for Tripartite Cooperation its opinions on the draft budgets for 2023 of the Republic of Bulgaria (RB), the State Social Security (SSS) and the National Health Insurance Fund (NHIF).
The opinions express support in principle for the presented bills insofar as Bulgaria finds itself in an emergency situation in which in mid-2023 the state is functioning on the basis of the budget framework for 2022, which was extended twice within the previous 6 months.
In the meantime:
- BIA expresses serious reservations to the macroeconomic parameters set in the State Budget Law of the Republic of Bulgaria and in the Updated Medium-Term Budget Forecast, as well as to a number of proposals for amendments to other laws contained in the transitional and final provisions of the State Budget Law, including. In addition, the following amendments to the Budget and Fiscal Control Law, which include: payment of wages by medium and large enterprises and dividends only by bank transfer, and the possibility of non-payment of the delivery/sales value for restaurant and catering services in case of non-issuance of a fiscal receipt; measures in the area of fiscal control of high fiscal risk goods, leading to a new administrative burden for high fiscal risk goods and substantial costs for businesses.
In view of the short timeframe for the preparation of the current draft of the 2023 State Budget Law, no policy changes are envisaged. In this sense, BIA expects proposals for a number of reforms to be reflected in the discussions of the 2024 budget procedure, including: a shift to real programme budgeting; administrative reform; preservation of the taxation model; a change in the so-called minimum wage (MW) mechanism established at the beginning of 2023 in Art. 244 of the Labour Code; decentralisation of public finances; setting the amount of the municipal waste charge on a volume basis; measures to stimulate investment and reforms to ensure a favourable business environment; stimulating gross private domestic investment; measures to encourage companies to invest in the so-called green and digital transition.
- According to the BIA, there are worrying trends as a result of political decisions that deviate from the principles on which the insurance system is built. The draft Law on the Budget of the State Social Security for 2023 creates conditions for a gradual increase in the deficit in the coming years, without providing for a reform of the system to ensure its financial sustainability. A debate on the long-term sustainability of the financing of the pension system is necessary in order to ensure predictability for the insured and increase their confidence in the system.
- The BIA's overall assessment of the draft law on the NHIF budget for 2023 is that it does not create conditions for reforming the system and improving the quality of healthcare services for the population. This budget replicates the situation in 2022, creating the conditions to deepen the deformations and dissatisfaction with the work of the system.
