Bulgarian Municipalities Disgruntled over Revised Budget Cuts

The second reading of the 2010 Revised State Budget Act will be done Thursday. Photo by Sofia Photo Agency

Bulgaria’s Revised Budget 2010 intends cutting the money for the municipalities by BGN 100 M, instead of the previously announced BGN 138 M, the Chair of the Parliamentary Budget Committee has announced.

Menda Stoyanova said Tuesday that the budgets of the municipalities will be decreased by 30% and there will be bigger cut in the bigger municipalities’s budgets than the budgets for the smaller ones.

Even with less cuts than previously announced, municipalities still fear they will have to face huge losses due to the decrease of their budgets.

“If the Local Tax Law does not change so that the municipalities are able to accumulate their own revenues and co-finance European projects, they will lose more than EUR 1.5 B,” said Ginka Chavdarova, Executive Director of the National Union of the Municipalities.

Another change in the 2010 Revised State Budget Act, announced by the Chair of the Parliamentary Budget Committee, is additional BGN 26 M provided for medications. She also noted that the debatable BGN 116 M subsidies for the tobacco producers will be kept.

According to Stoyanova, additional BGN 26 M will be provided for Bulgaria’s National Health Insurance Fund, so that there are no problems with the medicines, provided by the Fund.

“All the additional resources, included in the revision, will be distributed in different entries in the law. The size of the deficit is the same, just like the three options for its financing. The Council of Ministers will decide which is the best one, considering the external and internal debt, and the fiscal reserve,” Stoyanova said.

She noted that the decrease in the subsidy for the religion has been cancelled since it is a matter of “minor amount of money”.

The second reading of the 2010 Revised State Budget Act will be done Thursday. According to Stoyanova, there have been more than 40 propositions for the revised budget between the first and the second reading.

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