25.10.2012

MS CHAIRPERSON,

LADIES AND GENTLEMEN MEMBERS OF PARLIAMENT,

The main task of the Government in the budget preparation for the period 2009-2010 was to return the country to financial stability, while in the period 2011-2012 it was to maintain that stability. With the 2013 budget we are focusing on increasing income.

The macroeconomic assumptions for the national economy in 2013 are for GDP growth of 1.9% to which the main contributor will be domestic demand. In respect of labour market we expect to maintain employment and the average annual unemployment to be 12.4%.

Revenues are 37.5% of GDP, an increase by 6.4% compared to the 2012 programme. The tax rates of corporate and personal income taxes are preserved. A number of measures have been provided for to improve revenue collection.

By priority the expenditure policy provides the necessary resources in the social policy field. The measures pertain to:

• indexation of pensions as from 1 April 2013, the average percentage of the increase being 9.3% for all pensions. The pensions before 2009 will be increased by 9.8%. This will entail an increase of expenditure by BGN 585.9 million.
• increase of the minimum retirement pension as from 1 April 2013 from BGN 145 to BGN 150.
• increase of the social retirement pension from BGN 100.86 to BGN 110 as from 1 April 2013.
• increase of the maximum pension threshold from BGN 700 to BGN 770 as from 1 April 2013.
• increase of social assistance and social benefits expenditure by BGN 134 million, and the expenditure for social assistance and employment programmes, measures and actions by BGN 72.1 million.
• increase of the minimum monthly salary from BGN 290 to BGN 310.
• increase of the maximum insurable income from BGN 2000 to BGN 2200.
• increase of the social security contribution for the pension fund by 20 p.p. for those working in the field of security and defence, which will amount to an increase by BGN 218 million.

For education an increase of the overall financing of the policies in the sector by BGN 124 million is foreseen, including an increase of the uniform expenditure standards and the targeted allowances for financing the education of children and students in the system of public education. Yesterday at a meeting with the CITUB teachers\' trade union we agreed on additional BGN 20 million to increase the expenditure standards. The changes in higher education foresee differentiation of state higher schools funding depending on the quality of education assessment.

The other priority sectors where an increase of funds is provided for are as follows:

• culture - an increase by around BGN 35 million, including for state and municipal culture institutes BGN 26 million.
• healthcare - an increase by more than BGN 91 million.
• public infrastructure in the field of public works and environmental protection - an increase by BGN 510 million.
• agriculture - an increase by BGN 196 BGN.

The 2013 budget implements a consistent expenditure policy that will again guarantee that next year Bulgaria will still be among the three EU Member States with the lowest budget deficit and debt to GDP ratio. An achievement to which have contributed both the good fiscal policy of the present Government and the prudent policy of the previous governments.

Thank you!