Bulgarian Govt Backs Out of Planned 10 % Cut of State Spending

Business | April 7, 2010, Wednesday // 18:51|  views

"There is no point in doing something that the Constitutional Court said it can't be done", said Prime Minister Borisov. Photo by BGNES

Bulgaria's government has given up its planned 10% cut of state spending after a Constitutional Court ruling declared illegal three provisions of the 2010 State Budget Act.

This has been announced by Prime Minister Boyko Borisov, who made it clear that one of the anti-crisis measures of the cabinet contradicted with the court ruling in question.

As part its newly approved anti-crisis package, Bulgaria’s government was expecting to save BGN 450 M from the 2010 budget by reducing state administration staff and additional expenditures..

The 10 % cut of state spending was measure No. 19 of the 60 anti-crisis measures that Bulgaria's government approved last month.

Measure 19 provides for a 10% cut in public sector spending including salaries in institutions which had failed to reduce their staff by 15% as was prescribed by the Finance Ministry in the fall.

It is against the constitution because of the fact taht the cabinet is not allowed to cut expenditures of ministries, departments and municipalities, without approval of the Parliament.

“There is no point in doing something that the Constitutional Court said it can't be done. If we do it today, the Constitutional Court will be appealed again, it will come up with the same ruling, and our decision will be made void,“ Prime Minister Borisov explained.

He did not specify whether this is a final desicion of the Bulgarian government or it will file a new plea over the austerity measures.

The cabinet of Boyko Borisov will have another meeting on Monday in order to consider other ways to implement measure 19 of the anti-crisis package which will save BGN 360 M from budget cuts in the ministries, and further BGN 90 M from cuts in municipal grants.

In January, Members of the Bulgarian Parliament from the opposition Socialist Party and the ethnic Turkish Movement for Rights and Freedoms (DPS) filed a suit with the Constitutional Court over “unacceptable transfer of powers from the Parliament to the Council of Ministers.”

The magistrates annulled the most argued about text which provided the cabinet with the authority to reduce the non-interest expenditures in the event of worsening of the economic and financial indicators of the country without the Parliament's permission.

The text giving the Council of Ministers rights to increase the subsidy of the judicial system in case it fails to collect revenues has also been declared anti-constitutional.

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Tags: anti-crisis measure, anti-crisis package, anti-crisis program, government, Cabinet


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