The Chairman of the Board of AIKB Rumen Radev commented on the bTV broadcast on the draft state budget and the need for structural reforms, emphasizing that at the moment it is a project that has yet to be reviewed and changed.
„Of course, this is still a draft budget. It is some form of promise“, Radev said.
He drew attention to the fact that the budget is adopted at the end of June for the current year and its real effect will be limited in time.
“We are talking about adopting a budget, notice, at the end of June for the current year. While it is being agreed upon, etc., this means that its effect will be from August to the end of the year. This can also play a good role as a transitional budget, which, perhaps, the government is trying to rely on as a philosophy. And accordingly, the real, 2027, full-fledged budget should set policies“, he pointed out.
However, according to him, there is a risk that the promised policies and reforms will remain for a later stage.
He recalled that the AIKB has prepared opinions on both the NHIF and state social security budgets, as well as on the state budget.
“We currently have a cabinet, which, in turn, has an exceptional majority in the National Assembly. Any excuses like “this is not our budget” – "This is unacceptable for us," said the Chairman of the Board of Directors of the Bulgarian Insurance and Credit Association.
Radev also recalled the debates from the end of last year related to changes in the tax and social security model.
“There was a planned serious reshaping of the entire tax and social security model not only within the budget for 2026, but also within the three-year forecast“, he noted.
According to him, a positive element is the refusal of accounting solutions to conceal the deficit.
“We certainly have a problem in the finances of the state. We certainly had accumulated imbalances. We all know this very well. An attempt to resolve such imbalances through a strong increase and additional financing of the deficit with external debt is clearly unacceptable“, said Radev.
He pointed out that there are two approaches.
“Either you are trying to do some accounting gymnastics within this short period of time. We have seen this in more than one government“, he said.
As an example, he gave practices from previous administrations.
“There were, of course, things with sudden dividends being taken by state-owned companies, precisely from the “Energy“ sector. But this is one approach. It is not an approach that we approve of at all,“ Radev pointed out.
According to him, acknowledging the problem is the right step, but it is not enough.
“We believe that it is not enough to just say: there is a problem, let's see how to solve it. And let's solve it structurally, let's solve it with reforms, and not just with the beginnings of such reforms," he said.
Radev noted that so far, there is mainly talk about freezing income and reducing personnel costs in the public sector.
„What we are saying is that you obviously need to be much more proactive in all areas of the public sector, and where exceptions are made, these exceptions should be explained,“ he emphasized.
The Chairman of the Board of Directors of the Bulgarian Chamber of Commerce and Industry also emphasized the need for digitalization.
„We are talking here about huge data centers, artificial intelligence and so on, and files are still being moved by hand, slowly, and are being lost in an opaque way. We do not even conduct basic document management electronically, he said.
Regarding the proposals to limit capital expenditures, Radev pointed out that the AIKB has specific estimates.
„We could look for an end to the year in the current year of 2026 with a deficit of around 4%, a maximum of 4.5%, but rather in the lower part - around 4%. And accordingly, in 2027, we should proactively seek a deficit that does not reach 3%, below 3%,“ he said.
According to him, efforts should be focused mainly on the expenditure side.
„Exclusive efforts are focused precisely on the expenditure structure. Yes, including the capital program, which is indeed currently, perhaps, not priced in the best way possible," Radev pointed out.
He recalled that the funds under the Recovery and Resilience Plan should remain budget neutral.
„We are currently committing national funding to cover costs that will subsequently be covered through the corresponding payment from Brussels under the PVP“, he said.