Should civil servants start paying their social security contributions like everyone else? Is it time for pensioners in the administration to make room for the younger ones? Does the state really have the courage to cut 10% of its own administration? The topic was commented on in “This Morning“ by economists Vanya Grigorova and Mihail Krastev and with financier Levon Hampartzumyan.
Today, it is expected that the parliament will finally adopt the raising of the debt ceiling by 3.8 billion euros. There is a dispute, including in the opposition, about what the ceiling should be. GERB says – too little, from “We continue the change“ – too much.
“The truth is that we have a serious deficit and it cannot be compensated without a loan at the moment. But in the long term, measures must be taken to reduce it. For example, insurance in private pension funds should not be mandatory, because about 3 billion leva go there annually. We would not have had to take half of this loan if some private pension funds did not collect funds from working Bulgarian citizens by law, without giving any guarantee for the pensions that they will then pay out“, commented Vanya Grigorova.
“Second - abolish the maximum social security income. This would bring another 5 billion leva annually to the budget. These are bold measures that can balance the system," she pointed out.
Grigorova recalled that there is already an excessive deficit procedure against Bulgaria and that there will be consequences, including financial sanctions, if the recommendations are not implemented.
"Because entering the eurozone, as Mr. Hampartzumyan presented to us as entering the Club of the Rich, but he did not end with the fact that we enter there as servants, and in fact it costs us an enormous amount and we see that even before this year is over, they are starting a procedure. This is in advance. That is, they do not even wait for the year to end and see what the deficit will actually be, they are imposing a procedure in advance. And this is actually the loss of sovereignty. Not the lack of the lev, which was often commented on. The loss of sovereignty is due to the fact that they are already prescribing what to do, including being able to write you a budget. And then why do we elect the government," said Vanya Grigorova.
"When we talk about the European Union with "they" - it's not "they", but "we", because we are part of the European Union, a full member. The fact that we may not send our best people to Frankfurt, Brussels, etc. is another matter. Now what can I do that Mrs. Grigorova doesn't feel like she's in the club - she just needs to go there more often, to see what it's all about," said Levon Hampartzumyan.
"He's a banker and he's rich. He's extremely rich. I can't possibly feel part of his club," pointed out Grigorova, to which the financier replied that he worked in Kremikovtzi for five years and knows two and two hundred.
"The problem in recent years is not in the revenue side. Revenues are at record levels, including this year. The problem is the costs. The problem is the broken automation models. The problem is the broken Swiss rule, which was broken in previous years, and now we are fighting to keep it. When we follow the rules, we have to follow them in both directions. We have a problem in the expenditure part. And the fine, which is about 60 million euros, which the European Commission would impose on us, we pay a much higher price than the fact that new debt issues are about to be issued, which will be on less favorable terms, because when we issue debt, we go to international markets and seek investor interest," said economist Mihil Krastev.
"And when we have a country in a surplus deficit, the interest of investors is one and the premium they demand is one. Interest can reach over 300 million euros annually because we are a country in a surplus deficit and when we enter international markets, the investors themselves want more favorable conditions for them and less favorable for the state", he pointed out.
"We should stop using the economic situation of the state for propaganda or personal political gains and start treating this thing professionally. Because there are imbalances, there are things that need to be fixed, this will never end. It is not a question of writing 10 points that if we fulfill, we will flourish and be tied, but of using our advantages and moving forward", noted Levon Hampartzumyan.
According to Vanya Grigorova, there is a serious violation of justice and civil servants are not favored. According to her, they want to pay social security contributions.
"It is categorically false that the salary in the public sector is higher than that in the private sector," she said.
“Civil servants are not the public sector. That is, when we imagine that new social security contributions will begin to be introduced, they will not be for these 700,000 people. They will be for much fewer people“, pointed out Mihail Krastev.