site.btaPensions Go Up by 7.8% from July 1

Pensions will be increased by 7.8% from July 1 under the so-called Swiss rule, Deputy Prime Minister and Finance Minister Galab Donev told a news briefing at the Council of Ministers on Wednesday.

With this rule, the average increase rate is based on the average annual inflation and average annual contributory income for the previous year.

Donev said that over the past two years pensions had not been updated under the Swiss rule and only one of its two components had been applied. "Governments had made decisions that suited them," he said, stressing that the current Government is not shirking responsibility.

Regarding the COVID supplement of BGN 60 paid with pensions, Donev recalled that it was introduced in 2022 and that governments had made several attempts to discontinue it, adding that anti-COVID measures have been discontinued in all other countries. Donev said the COVID supplement will not be paid for newly granted pensions after July 1. For all pensions already granted, it will remain at BGN 60 and will be indexed by the coefficient used for updating pensions under the Swiss rule from July 1, he said.

The removal of COVID-related supplements for pensions that are newly granted after July 1, a 7.8% increase in minimum pensions, and a reduction in the state subsidy for political parties were approved on Tuesday by the temporary parliamentary Committee on Budget and Finance during the second reading of amendments to the Act on Collecting Revenues and Incurring Expenditure in 2026 until the Adoption of the 2026 State Budget Act.

Donev said that reducing the budget deficit from 7.4% to 3% is possible and depends on the measures to be proposed in the State Budget Act and undertaken by the Government.

He said that if society is ready to bear such measures, the first step should be an income freeze, as well as decoupling all mechanisms that link wages to the national average gross wage or to the minimum wage. In his view, there should be structural change and consolidation of the state administration, as well as curbs on government expenditure. “We are not touching delegated budgets — funds for culture, education, healthcare and psychiatric hospitals,” he added.