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A 3.9% deficit of Gross Domestic Product and the possibility of generating new debt of up to 4,500 million BGN next year. These are the main parameters of the financial framework for the coming year, the draft of which was published on the website of the Ministry of Finance.
The priorities of the 2021 Budget are income policy, education, health policy, social policy, pension policy and defense policy.
The draft budget for 2021 is the third update this year. The third update of this year’s budget is expected given the large expenditures during the year, as well as the serious deficit for next year. Some of the policies set for 2021 have already been announced.
The most important item of the consolidated fiscal program is social expenses, which exceed BGN 18,000 million. 650 BGN will be the minimum wage next year and will be maintained for the next three years. In total, in the budgetary sphere, salary growth next year will be 10%, but for those employed in the first line it will be 30%.
Until March, pensioners will receive a supplement of BGN 50 and the update of pensions in the middle of the year will be 5 percent. It is planned to increase the minimum pension from BGN 250 to BGN 300, as well as a maximum pension of BGN 1,440 while maintaining the maximum insurance threshold of BGN 3,000. There is more money for education and healthcare, and defense spending exceeds BGN 2 billion.
A series of measures are planned to support companies, reads the reasons for the draft budget for next year, which also contains the medium-term forecast for the development of our economy. By 2023, our country will slowly melt the deficits accumulated during the recovery period from the crisis caused by the Covid-19 pandemic. However, in 2023 the treasury will be in the red.
Regarding the debt policy, the first reading of the bill shows that in addition to taking out foreign debt according to the global program, the opportunities for bonds in the domestic market, bond buybacks and other operations with existing obligations are emphasized. By the end of 2021, our country’s maximum debt should be BGN 31.9 billion.
The fiscal reserve must be at least BGN 4.5 billion. The Ministry of Finance also presented the updated Medium-Term Budget Forecast (ASA) for the period 2021-2023.
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