Dimitar Glavchev, Deputy Chairman of the Budget and Finance Committee at the National Assembly: The National Council for Tripartite Cooperation is not an opponent to the adoption of the new Budget Draft 2012 but the budget performers should actually bear

- Mr. Glavchev, it became clear these days that no major amendments will be adopted to the new Budget Act 2012 between its first and second reading in Parliament. Does this mean that no budgetary funds can be set aside for an increase in pensions and social benefits? And if you plan increases, where will these come from?
- It is normal for no significant amendments to be adopted to bills between their first and second parliamentary reading, when these are well-considered and presented. This applies with full force to the passing of the most important Budget Bill for the year. Meanwhile, the EU's main priority is to combine competitiveness with solidarity. In times of crisis, the proper ratio between these is the key sign of a high-quality government. We are providing competitiveness without changing the low tax and social insurance burdens. Besides, by aiding low-income citizens, GERB (Citizens for European Development of Bulgaria) is proving that this does not happen at the expense of solidarity. It is inappropriate for the crisis to be borne by the most socially disadvantaged people. The bulk of citizens with the lowest incomes are pensioners receiving the minimum pension to the amount of BGN 136. GERB has always shown a commitment to this category of people and seeks all possible options for aiding them, including envisaging higher incomes in the budget. Therefore, there was a proposal for an increase of BGN 9 in the minimum pension from BGN 136 to BGN 145 as of June 1, 2012, which will affect nearly 750,000 people. The same proposal also indicates the cause of this increase which is related to the envisaged 1-year increase in the retirement age as of January 1, 2012. Numerically, the revenue and expenditure budget parts stipulated in the proposal are approximately equal, which makes them completely balanced.

- The social partners including employers and trade unions argue that some funds were actually hidden under different budget items but that they serve other political interests? Employers detected about BGN 250 mln, while trade unions calculated about BGN 600-700 mln hidden in the scheduled deficit reductions.
- There are no hidden funds in the Budget Draft 2012 proposed by the Council of Ministers. GERB's policy has always been transparent, visible and comprehensible to the public since it refers to the maintenance of fiscal stability and to aiding the key fields of development such as education, healthcare, infrastructure and the public sector. I would be glad if the social partners in - trade unions and employers - provide us with effective ideas as to how to find the additional funds of BGN 250 mln, let alone BGN 600-700 mln. I emphasise that these ideas should be effective because other ideas were already proposed referring to various" alternative budgets''.

- In practice, the National Council for Tripartite Cooperation was eliminated as a major opponent to the adoption of the new Budget Draft. Do you think that you can agree with some of their arguments on the pension reform?
- The dialogue with our colleagues from the Tripartite Council continues. The Tripartite Council is not an opponent to the adoption of the new Budget Draft. Its organisational scheme allows each party and participant to suggest more and better solutions, while every substantiated and supported proposal should be heard and considered.

- If budget amendments envisaged by you between the first and second parliamentary reading of the Budget Act are merely cosmetic, what can the proposals on the increase in retirement age change? Besides, how much funds do you expect to be saved in the long-term?
- The adoption of amendments affecting the pension system is necessary. Our objective is not to save funds directly from pension allocations but to reduce the budget deficit of the Public Social Insurance Budget, which is our task in the long-term. As a result, budgetary resources will be released for the implementation of other policies in the social sector. The envisaged increase in the retirement age is a natural process following the demographic structure of both Europe's and Bulgaria's population, thus enabling legal and private entities to remain economically active on the labour market for a longer period. If this step is not taken, the pressure on pension systems can lead to serious instability.

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