site.btaEC Fully Intends to Move Forward with Excessive Deficit Procedure against Bulgaria, Finance Minister Says

Speaking during quick Question Time in Parliament on Friday, Deputy Prime Minister and Finance Minister Galab Donev said that the European Commission (EC) would move forward with an excessive deficit procedure against Bulgaria. 

Donev said that on Thursday an EC mission met with representatives from several ministries to discuss the implementation of the Recovery and Resilience Plan, macroeconomic imbalances, and the state of Bulgaria’s public finances.

"It transpired after the meeting that the Commission fully intends to proceed with the excessive deficit procedure," he noted. Donev added that the process was launched following an assessment of Bulgaria’s net expenditures for 2025, where the estimates of the Finance Ministry and the European Commission differed to some extent. The discrepancy arose because the caretaker government failed to submit the report on the state of public finances by the April 30 deadline, leaving the Commission with data only for 2025, the Minister said.

The report will now be submitted to the Economic and Financial Committee for review before being considered by ECOFIN. The final step will be a decision by the Council of the European Union on whether Bulgaria should formally be placed under the excessive deficit procedure, Donev said.

If the procedure is launched, the European Commission will require Bulgaria to adopt specific measures to reduce the deficit, he added.

"One of the measures explicitly mentioned by the Commission during yesterday’s talks is the need to reduce net expenditures by 0.5% of gross domestic product," he said. The minister added that this would require spending cuts and an analysis of the structure of budget expenditures.

"The structure of our budget expenditures is not very good. Around 76% of spending goes toward salaries, social payments, and pensions, while only about 24% is allocated to investments," he noted.

The government will need to propose measures that align with the European Commission’s recommendations, Donev said.