The International Monetary Fund (IMF) has recommended tightening belts and stopping wage increases in the public sector, along with raising taxes and changing the social security system. This became clear from an interview with former Social Minister Hristina Hristova, broadcast today on Bulgarian National Radio.
"The challenges facing our first budget in euros are indeed great and require some new competence from the point of view of the transformation of our currency", said Hristova, quoted by Bulgarian National Radio.
According to the former minister, the IMF recommendations are not new, but the political instability over the last 4-5 years has played its role and now Bulgaria will "reap the fruits of the automatisms in the increase in spending". Hristova pointed out that the Fund has reason to claim that it will inevitably lead to an increase in taxes if this continues.
Hristova called for a halt to the automatic increase in budget salaries and the minimum wage, if the political will is found to do so. She emphasized that the increase in the minimum wage is 15%, which significantly exceeds both inflation and the growth in labor productivity.
"It is necessary to have an individual approach in the public sector," Hristova was categorical. She added that the fight against the shadow economy is another resource for reducing the pressure on the budget and the pension system.
The increase in taxes on housing, which is among the IMF's recommendations, is entirely possible in our country, the former Minister of Social Affairs believes. She pointed out that the revenue from this tax in Bulgaria is the lowest in the entire European Union, and its increase will provide more resources to municipalities.
Hristova expressed concern that the minority government is in a difficult position, faced with numerous populist demands that would further complicate the budget.
"When there is reason, then there is trust in the government", concluded Hristova, expressing hope for reasonable actions on the part of those in power.