It is in force from 2024 revised framework for economic governance of the European Union. The main objectives are to ensure the stability and sustainability of public finances in the medium and long term for all Member States, promote sustainable economic growth and overcome macroeconomic imbalances through reforms and investments to strengthen growth and sustainability. According to the revised framework for economic development of the European Union, each member state must prepare a medium-term fiscal-structural plan, which includes the policies and guidelines for economic development of the country for the relevant period, linked to European policies and objectives, as well as necessary investments and reforms to achieve sustainable economic growth and development. This was reminded by the Acting Minister of Finance Lyudmila Petkova, quoted by novini.bg.
"The Republic of Bulgaria should prepare its medium-term fiscal-structural plan for the period 2025-2028. It should include the national policies and guidelines for economic development, as well as the necessary investments and reforms to achieve these policies, taking into account the planned investments in the National Plan for Recovery and Sustainability and the projects under the European funds. "The preparation of the Plan has a direct impact on the preparation of the budget," she explained.
According to the preliminary schedule, the medium-term fiscal-structural plan for the four-year period and the Budget Law for 2025 should be approved by the Council of Ministers by the end of the month – 31st October 2024
"The first part of the questions that arise are related to policies and guidelines for economic development. The caretaker government should not determine the policies for economic development of the country for the next 4 years," explained Petkova.
There are two possible solutions:
1. The plan should be prepared by a regular government, according to its management program.
2. The priority areas and policies for the development of the country should be discussed in advance with the parliamentary parties and coalitions in the National Assembly, and if an agreement is reached, they should be included in the four-year plan.
In the part related to reforms and investments – the same question arises.
„Which reforms and investments should be included in the plan to achieve the set policies and priority areas for economic and social development of the country. It is necessary to be committed to the reforms and investments that are included in the NPVU and the projects under the European programs and funds. They should not be duplicated, but should follow and complement the projects that are included in the PVU and programs under European funds“, added the Minister of Finance.
"Last week in the National Assembly, there was a desire to discuss the changes in the NPVU, as well as the content of the REPower chapter. The negotiation process has stopped at the moment, because the caretaker government did not receive a mandate from the National Assembly to continue negotiations with the European Commission (EC). It is impossible to formulate reforms and investments to be included in the medium-term fiscal-structural plan", Ludmila Petkova explained.
The Minister of Finance Lyudmila Petkova also announced the results of the department's expert evaluations, which show the need for timely measures to balance revenues and expenses due to the tendency for the growth of expenses to exceed revenues more than once. There are ambiguities especially around the European funding and the money for the PVU.
There is no comment on cutting costs or raising taxes, the measures must be discussed with all parties, said Petkova. And he indicated as a potential measure only a redistribution of income and expenses, but did not go into more detail about what they would offer the parties.
Most expenses come from payments for pensions and personnel, which are over 40 per 100 of all expenses, the minister explained.