Bulgaria parliament passes last-minute budget revision

Bulgaria: Bulgaria`s parliament adopted on Tuesday a last-minute budget revision, raising the country`s deficit target and debt ceiling in a bid to buttress it against fiscal troubles until snap elections on October 5.

The revised budget bill was passed despite fierce opposition by the outgoing Socialists, who scorned the changes proposed by their own minority government before it resigned last Wednesday. It was backed by 117 lawmakers from the right-wing opposition GERB party and the Turkish minority MRF party out of a total 178 present in the 240-seat body. The bill was already once rejected by parliament but was put to the vote again after receiving strong backing from President Rosen Plevneliev last week. The president justified the revision as necessary to guarantee the country`s financial stability during the pre-election political vacuum when it will be governed by a caretaker cabinet with limited functions. "The only motive for the revision is strengthening the fiscal buffers available to the caretaker government with a view to guaranteeing the financial stability of the country," outgoing finance minister Petar Chobanov told lawmakers. The revision increased Bulgaria`s year-end public deficit to 2.7 percent of output from the previous target of 1.8 percent and greenlighted the issuing of new debt of 3.4 billion leva (1.7 billion euros, $2.4 billion). Most of the extra funds were earmarked to help the government to cope with liquidity problems at Bulgaria`s fourth-largest Corporate Commercial Bank (CCB) that might see the lender go bankrupt. In order to enter into effect, the bill will have to pass a second reading in the legislature -- seen as a mere formality -- before its planned dissolving on August 6. The EU`s poorest member state is battling with meagre economic growth, prolonged deflation, rising unemployment and lower-than-planned budget revenues amid political instability that saw a second government collapse within less than 18 months. Many analysts however questioned the need for a budget revision and called the proposals for more powers for the caretaker cabinet "unconstitutional", insisting that government coffers held enough money to last until the next government takes over after the October 5 snap vote.