The European Commission has asked Bulgaria for additional explanations on how it will comply with the agreed spending limits under the budget plan for 2027. According to the data submitted by the country, net expenditure is expected to increase by 10.1% in 2026, against a recommended maximum of 4.2%.
For 2027, the projected growth is 1.3%, against an allowable 3.4%. Although the indicator is below the established threshold, the European Commission reports a cumulative deviation from the 2025 baseline of 1.1% of gross domestic product. After deducting the flexibility under the national derogation clause and the planned defence spending, the deviation is 0.6% of GDP.
In its letter of 26 October, the Commission requested information on which factors are driving the increase in net expenditure in 2027 and how Bulgaria will ensure compliance with the recommendations of the Council of the EU. Brussels warns that a comprehensive assessment of the measures taken may follow at a later stage. If the measures are found to be ineffective, the excessive deficit procedure could be intensified.
What Bulgaria replied
Bulgaria sent a reply to the European Commission on 2 November. In the letter, Finance Minister Galab Donev explains that 2026 began without an adopted annual budget, which limited the possibilities for controlling expenditure.
“2026 began without an adopted annual budget,” Galab Donev said.As an additional measure for 2027, the government plans to allow primary budget spending units to spend up to 90% of their approved annual funds. The remaining 10% will be provided after 1 November, only if this does not lead to a deterioration in the budget balance. The measure does not apply to municipal budgets or funds for social assistance and benefits.
In their reply, the Bulgarian authorities also state that they expect the budget deficit to decrease from around 5% of GDP in 2026 to 4.2% in 2027, 3.5% in 2028 and 2.8% in 2029.
Bulgaria remains under the excessive deficit procedure
The Council of the EU opened an excessive deficit procedure for Bulgaria in July 2026. The reason is the projected deficit of 4.1% of GDP for 2026 and the expectation that it will remain above the 3% threshold in 2027 as well. As part of the procedure, the country must take measures to correct it by 2029.
The European Commission’s final assessment of Bulgaria’s budget plan is expected on 24 November. It will then become clear whether the explanations and measures submitted will be accepted or whether additional action to limit spending will be requested.
Sources: focus-news.net, nova.bg