By Clive Leviev – Sawyer of The Sofia Globe
A promise by the Bulgarian Socialist Party (BSP) government to increase the minimum wage has been postponed to 2014 while the administration also has pared back a socialist election promise of a uniform financial boost for all families with first-graders.
More than three months into its term in office, the BSP government has been failing to act on these and other promises made before the May 2013 ahead-of-term parliamentary elections.
The failure to keep the promise about all families with first-graders benefiting from 310 leva (about 155 euro), made in May by BSP leader Sergei Stanishev, was highlighted when the new school year in Bulgaria started on September 16.
Instead of this sum being available across the board, a total of the “most socially vulnerable families” got 250 leva each. This sum was handed as a one-off grant to the families of 39 000 first-graders, out of a total 64 000 first-graders.
This means spending of 9.75 million leva instead of 19.8 million leva. The backtrack had been telegraphed earlier, in June a few weeks after the government came to office.
Also on September 16, it became clear that the BSP government was giving up its previous plans to increase the minimum wage in 2013, with October having been named as the date.
Instead, Plamen Oresharski – placed in the prime minister’s chair in May – and finance minister Petar Chobanov indicated that the minimum wage would be increased in 2014, and the specific sum would be determined by negotiations involving the private sector and trade unions.
Meanwhile, it also became clear from remarks by Chobanov that pensioners were now unlikely to see the promised Christmas bonus.
“I hope that the third quarter will be better than the second, and the fourth better than the third, and then we can talk about such bonuses,” Chobanov said. “We can make every effort for that to happen, but it is a question of specific accounts and opportunities that cannot come without economic growth.”
It also remains unclear what has happened about a promise by BSP MP Dora Yankova that the tax on bank deposits, that came into effect in January 2013 as a result of legislation tabled by the former centre-right GERB government, would be scrapped.
In July, Yankova said that the tax, which she described as evidence that the GERB government had burdened the poorest and most honest Bulgarians in the crisis, would be removed.
Oresharski now reportedly intends retaining the tax, in contrast to the position he took in 2012 when he was an opposition MP.
At the time that he opposed the tax on bank deposits, Oresharski said that Bulgarians had a negligible amount of savings and the taxes would further hamper this process, with low savings hampering investment and economic growth. As prime minister, however, Oresharski appears to see the tax as a source of revenue.
Daily Sega reported that BSP and MRF figures were reluctant to speak on the record about the tax on bank deposits issue, while it was awaited whether and how the question would be addressed in the forthcoming draft national Budget for 2014.
The GERB government expected that the tax on bank deposits would yield about 120 million leva in 2013. By the end of July, revenue from the tax was about 56 million leva and the annual estimates were unlikely to be fulfilled, Sega said.
Other BSP election promises that remain unfulfilled (whatever the individual merits or lack of them of these promises) include a pledge to, on taking office, immediately restart the construction of the Belene nuclear power station, and to abolish the full ban that came into effect in June 2012 on smoking in restaurants and other enclosed public spaces, in favour of the previous system of separate smoking and non-smoking areas.