02.09.2019

Based on preliminary data and estimates the balance of the Consolidated Fiscal Programme (CFP) on a cash basis as of August 2019 is expected to be positive, amounting to BGN 1,104.2 million (1.0 % of the forecast GDP). On a monthly basis, the CFP budget balance is negative only for August.

After the adoption of the Law amending and supplementing the 2019 State Budget of the Republic of Bulgaria Law and the ratification by the National Assembly of the international contracts for the purchase of F-16 Block 70 fighter aircraft, armament and related systems for long-term operation and maintenance, as well as for the comprehensive training of pilots and auxiliary personnel, in August the Ministry of Defence transferred the amount of USD 1.2 billion to a US government account. Thus, the Bulgarian party fulfilled its commitment under the contracts concluded within the investment expenditure project “Acquisition of a New Type of Fighter Aircraft” for the Air Force of the Republic of Bulgaria and initiated their practical implementation.

The significant amount of the expenditures for the implementation of this investment project has led to a reduction of the currently reported excess of revenues over expenditures as of end-August to around 1% of GDP.

Key CFP parameters on the basis of preliminary data and estimates:

Revenues and grants under CFP as of August 2019 are expected to be BGN 29,298,8 million, or 66,8 % of the annual estimates. As compared to August 2018, CFP revenues have risen by BGN 3,323.1 million, with growth being registered in both tax and non-tax revenues, and grants and donations where the grants under the EU programmes and funds are mostly recorded. The growth of tax revenues is BGN 1,930.7 million, of non-tax revenues – BGN 1,102.1 million, and of revenues from grants and donations – BGN 290.3 million. As regards non-tax revenues, there is mainly a baseline effect in the part of revenues under the Electricity System Security Fund due to the amendments to the Energy Law in force as from 1 July 2018.

The Consolidated Fiscal Programme expenditures, including the contribution of the Republic of Bulgaria to the EU budget, for August 2019 amount to BGN 28,194.6 million, which accounts for 60.9 % of the annual estimates[1]. For comparison, the expenditures under the CFP as of August 2018 amounted to BGN 23,587.7 million. In addition to the above mentioned expenditures under the budget of the Ministry of Defence, the nominal increase as compared to the same period of the previous year is also due to the higher amount of staff costs (a 10% increase in the wage bill for the public sector and the next step of increasing the remunerations in the education sector), the higher social and health insurance payments (a baseline effect from the pension increase in July 2018, the pension indexation in July 2019 and an increase in the health insurance payments set out in the 2019 NHIF Budget Law), etc. 

The part of Bulgaria's contribution to the EU budget, paid from the central budget as of 31.08.2019, amounts to BGN 903.6 million, which complies with the current legislation in the area of EU own resources – Council Decision 2014/335/EU, Euratom on the system of own resources of the European Union, Council Regulation (EU, Euratom) No 608/2014 of 26 May 2014 laying down implementing measures for the system of own resources of the European Union, and Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for making available the traditional, VAT and GNI-based own resources and on the measures to meet cash requirements as amended by Council Regulation (EU, Euratom) No 2016/804 of 17 May 2016.

The statistical data and the Information Bulletin on the execution of the state budget and the key indicators of the Consolidated Fiscal Programme based on data from the monthly reports on the cash performance of the budgets of the first-level spending units as of August 2019 will be published on the website of the Ministry of Finance at the end of September 2019.

[1] Estimates to the Law amending and supplementing the 2019 State Budget of the Republic of Bulgaria Law (prom., SG, issue No 60 of 2019, in force from 30.07.2019).