site.btaParliamentary Committees Approve Draft Budgets of State, Health Insurance Fund, Public Social Insurance

Parliamentary committees Tuesday debated on and adopted at first reading the State Budget Bill, Public Social Insurance Budget Bill, and National Health Insurance Fund Budget Bill for 2026. The Government submitted the three draft budgets to Parliament on November 13. 

State Budget Bill

The Committee on Budget and Finance adopted the 2026 State Budget Bill with 13 votes in favour, 4 against and no abstentions. The macroeconomic forecast, prepared by the Ministry of Finance, predicts economic growth of up to 2.7% in 2026, and ranging between 2.4 and 2.5% in 2027 and 2028. Average annual inflation for 2026 is expected to be close to that in 2025. i.e. 3.5%, with average annual inflation slowing to 2.9% in 2027 and 2.5% in 2028. The budget balance under the consolidated fiscal programme (based on the national cash-based methodology), expressed as a share of GDP, for 2026 is a deficit of 3% of GDP. The general government deficit is also 3% of GDP for 2026. Public debt is forecast at EUR 37.6 billion (31.3% of GDP) in 2026, EUR 43.5 billion (34.2% of GDP) in 2027, rising to EUR 49 billion (36.6%) in 2028. In 2026, the maximum amount of new government debt that can be incurred is up to EUR 10.44 billion, including up to EUR 3.2 billion under the Security Action for Europe (SAFE) mechanism to strengthen the European defence industry. The fiscal reserve will total EUR 2.4 billion. Key social measures include a minimum wage of EUR 620.20, childcare and parental allowances of EUR 460.17, and increases in social security ceilings to EUR 2,352–2,659. Pension contributions rise by 2 points in 2026 and 1 point in 2028, while public sector salaries, including teachers', will increase. Tax changes include raising the withholding tax on dividends to 10%, expanding electronic reporting and tracking, and incentives for electric vehicles. The budget aligns with EU fiscal rules and Bulgaria’s euro adoption plans.

During the debate, Lyuboslav Kostov, chief economist of the Confederation of Independent Trade Unions in Bulgaria (CITUB), said that Bulgaria’s economic growth is driven by consumption, so the budget’s focus on raising incomes supports growth. Kostov added that this policy cannot yet be viewed as inflationary.

Atanas Katsarchev, chief economist of the Podkrepa Confederation of Labour, argued that the budget lacks policies to address the demographic crisis. He also urged attention to remuneration in public media, where there were recent protests.

Silviya Georgieva from the National Association of Municipalities said that municipalities are satisfied with the macro-framework for local government. Georgieva called for updating property tax valuations, unchanged since 2006, to boost municipal revenue and bring real-estate activity out of the grey sector.

Rumen Radev from the Association of Industrial Capital in Bulgaria said aggressive changes to the tax-insurance model have damaged employers’ trust, especially the unexpected rise in the maximum insurable income and contributions. Radev noted that limiting public-sector wage growth to 5% could save EUR 455 million.

Dobri Mitrev from the Bulgarian Industrial Association claimed that the budget "punishes" 2.1 million workers and compliant businesses. Mitrev criticized automatic minimum wage increases, mandatory NRA-approved sales software, and the expanded list of high-risk goods.

Boyan Nikolaev from the Confederation of Employers and Industrialists described the 2026 budget as "highly inflationary". According to him, the government is creating a "monster" that may be uncontrollable for the next 5-10 years.

Tsvetan Simeonov from the Bulgarian Chamber of Commerce and Industry said the biggest problem for business is rising labour costs. Simeonov opposed raising social-security contributions by 2 percentage points, warning it can only have negative effects.

Petar Chobanov, Deputy Governor of the Bulgarian National Bank, emphasized the central bank’s focus on price stability and said Bulgaria should avoid running deficits near the 3% limit. Chobanov added he expected more discussion on eurozone accession and its economic effects.

Yordan Tsonev, MP from the Movement for Rights and Freedoms (MRF) - New Beginning, declared support for the budget, arguing that wages for teachers, doctors and police must rise. Tsonev rejected employers’ criticisms, noting Bulgaria’s very low 10% corporate tax compared to 20–25% in the EU.

Martin Dimitrov, MP from Continue the Change - Democratic Bulgaria, said that the 2026 budget abandons Bulgaria’s key competitive advantage - low taxes.

Velichie MP Maria Ilieva announced that her parliamentary group will not support the budget.

Continue the Change leader Assen Vassilev argued that the government is "decapitalizing" businesses by raising the dividend tax, while simultaneously "buying consumption" through higher social-security contributions.

Vazrazhdane MP Dimo Drentchev dismissed employers’ complaints as unfounded, saying they do not represent the middle class and will not mobilize protests.

Atanas Atanasov, MP from BSP-United Left, said that his party will support the budget, calling it social in nature, with measures that raise incomes at a crucial moment before eurozone entry.

The State Budget Bill was also approved by the Committee on Transport and Communications with 11 votes in favour, 7 against and one abstention, as well as by the Health Committee, 11-7 with no abstentions. 

Public Social Insurance Budget Bill

The Committee on Budget and Finance adopted the Public Social Insurance Budget Bill with 13 votes in favor, 8 votes against, and no abstentions. The bill projects the average monthly pension in Bulgaria next year at EUR 541.20, which is an increase by 8.5% in nominal terms. The increase is more than double the average annual inflation rate of 3.5% forecast for 2026, meaning that older people's purchasing power will increase, the Government said. From July 1, 2026, all pensions granted by the end of 2025 will be adjusted by between 7% and 8%. From the same date, the minimum pension for contributory income and old age will increase from EUR 322.37 to EUR 346.87 for people with a full social insurance record. EUR 13,421 billion has been earmarked for the payment of all types of pensions and supplements in 2026, accounting for 11.3% of Bulgaria's projected gross domestic product. This is EUR 1,097 billion, or 8.9%, more than in 2025. From January 1, 2026, onward, the minimum insurance income for self-insured persons will be EUR 620,20. From the same date, the maximum social security income for all insured persons will be EUR 2,352.

The same bill was also approved by the Committee on Labour and Social Policy with 11 votes in favour, 7 against, and no abstentions. After the sitting, National Social Security Institute (NSSI) President Vesela Karaivanova-Nacheva told journalists in Parliament that the budget is the most feasible one in terms of revenue and expenditure policies. She noted that the minimum wage, the minimum income for self-insured persons and the maximum insurable income will all increase in 2026, alongside a two-percentage-point rise in the pension contribution rate. According to Karaivanova-Nacheva, the higher contribution rate will bring in an additional EUR 602 million. Each such policy indirectly leads to an increase in pension amounts, she said, explaining that these changes affect the average insurable income, which is part of the pension calculation formula. Bulgaria remains among the EU countries with the lowest pension contribution rate, the NSSI head said. The total social contribution rate in Bulgaria is 33%, while in some EU Member States 34% covers only the pension fund, without other social insurance risks, she added. A total of 536,000 pensioners remain below the poverty line, the NSSI President said.

National Health Insurance Fund Budget Bill

The Budget and Finance Committee also approved, 13-8 with no abstentions, the 2026 National Health Insurance Fund (NHIF) Budget Bill. The draft envisages EUR 5,571,998,400 in revenues and transfers to the NHIF budget next year. Revenues alone are projected at EUR 5,196,424,800, including EUR 3,177,034,800 in health insurance contributions and EUR 2,019,390,000 in transfers for health insurance. Expenditures will total EUR 5,571,998,400 (equalling revenues plus transfers). The revenue and expenditure sides of the NHIF budget for 2026 are both increasing by EUR 727,652,900, or 15%, compared with the budget for 2025. On the expenditure side, health insurance payments are set at EUR 4,985,168,900, increasing by EUR 448,026,700, or 9.9%, from last year. A new item in the annual scheme is an EUR 260 million allocation from the state budget, which will be used to pay for activities of medical treatment facilities under Article 80b, Paragraph 1 of the Medical Treatment Facilities Act.

During the debate, CITUB chief economist Lyuboslav Kostov said the union did not support the NHIF budget either in the Supervisory Board or in the National Council for Tripartite Cooperation. Their main concern is the EUR 260 million allocated through increased clinical pathway prices: "There is no guarantee these funds will go to wages, and the mechanism for financing salaries remains unclear," he said, adding that this also undermines collective bargaining and the forthcoming EU directive transposition. 

Rumen Radev, Chair of the Bulgarian Industrial Capital Association, noted that all four nationally representative employer organizations have rejected the NHIF budget. The main reason, he said, is the lack of any change in the budget philosophy and the preservation of the same spending structure. Employers consider this approach entirely wrong. They also criticize the continued practice of allocating 75% of expenditures to hospital care and medicines, compared to 45–55% in other EU countries. On preventive care, he noted that coverage remains around 50% despite attempts at incentives, and stressed that prevention must be systematically expanded.

The Health Committee adopted the draft NHIF budget with 11 votes in favor, nine against, and no abstentions. 

During the debate, Bulgarian Pharmaceutical Union Chairman Dimitar Marinov expressed support for the targeted funding for pharmacies in remote areas but noted that the budget did not increase funding for this mechanism. He warned that introducing minimum guaranteed salaries for pharmacists without specialization lacked guarantees that funds would go to hospital staff and that there were no penalties for hospitals that failed to comply. He supported the budget proposal but suggested it needed revision between the first and second readings.

Dr. Ivan Madzharov, Vice-Chairman of the Bulgarian Medical Association, expressed concern about how funds for hospital staff salaries would be spent. He also argued that specializing medics working with general practitioners should have received salary increases similar to those for hospital-based residents.

Valeri Apostolov of the Podkrepa Labour Confederation noted that the budget did not address key challenges such as the growing number of health facilities, lack of qualified staff, and concentration of services in large cities. He called for a 13.6% salary increase to compensate for inflation and past low raises and supported keeping the health insurance contribution at 8%.

Svilena Dimitrova, Chairman of the Bulgarian Hospital Association, pointed out that the budget increase was smaller than in previous years and likely insufficient, partly due to inflation. She stressed the lack of certainty about raising clinical pathway prices, which were tied to hospital staff salaries, and emphasized that the planned €260 million for medical staff should have been delivered through clinical pathways.

Maria Mincheva, Deputy Chair of the Bulgarian Chamber of Commerce and Industry, said the Chamber did not support the NHIF budget, arguing that the proposed salary increases were flawed and would not reach staff. She opposed earmarked contributions via the National Framework Agreement for salaries and stressed that salary calculations for other medical specialists were missing, risking tension in hospitals.

Vanya Grigorova, Chair of the Health Committee in the Sofia Municipal Council, warned that increasing salaries only for certain medical specialists would create conflicts. She argued that signing a Collective Labour Agreement (CLA) was the only fair way to raise wages.

Vazrazhdane MP Georgi Georgiev said his party would not support the draft budget and questioned the NHIF deficit at year-end.

Continue the Change - Democratic Bulgaria MP Alexander Simidchiev said he could not fully support the budget, citing insufficient data on population health and uneven growth between outpatient and hospital care funding. He also criticized the mechanism for minimum medical salaries, noting it was unclear if funds would reach the intended staff.

Continue the Change - Democratic Bulgaria MP Vasil Pandov MP criticized the budget for prioritizing hospital care over outpatient prevention and for lacking control mechanisms and reforms. He noted that the €260 million for staff salaries was no longer earmarked and argued that clinical pathways did not guarantee fair pay.

MP of GERB–UDF Kostadin Angelov  said his group would propose amendments so that the planned EUR 260 million would be used solely for salaries to healthcare professionals as per the Health Facilities Act.

MP of Alliance for Rights and Freedoms Hasan Ademov  said that annual billion-leva increases did not solve any problems and even created new ones. He called for an analysis of the volumes in outpatient and hospital care and did not support the budget as it stood.

There Is Such a People MP Andrey Chorbanov said the budget structure favored hospitals over prevention programmes, contributing to high mortality rates. He supported establishing minimum wage thresholds for doctors and nursing staff as a regulatory measure.

Ahead of the debates

Finance Minister Temenuzhka Petkova commented that the 2026 State Budget Bill represents “the most realistic budget possible”, as it has been prepared on the basis of current legislation and the policies pursued to date. She spoke to reporters in the National Assembly’s lobby before presenting the bill to the Budget and Finance Committee. She said that the European Commission’s forecasts align with those of the Finance Ministry – the planned deficit for 2025 stands at 3% on an accrual basis, a deficit of 2.7% of GDP is projected for 2026, while in 2027 the Commission expects Bulgaria’s deficit to rise to 4.3% of GDP. “The European Commission attributes this increase to higher defence spending, with the peak expected in 2027, when these expenditures will be particularly significant,” Petkova said. She stressed that no increase in value-added tax is planned.

The Bulgarian Industrial Capital Association (BICA) made proposals for the revenue side of the state budget for 2026. "If we as a society agree to a 5% increase in the remuneration of everyone in the public sector, the effect on the budget will be about 570 million. It exceeds the effect of a two-percentage-point increase in social security contributions," BICA Governing Board Chair Rumen Radev said. He was speaking at a national conference on professions and a sustainable future, held in Sofia. Regarding the dividend tax and its planned increase from 5% to 10%, Radev said that the latest opinions have been received and that the effect on individuals is extremely minimal. According to the BICA Chairman, the central budget has a buffer slightly below EUR 1 billion. His proposal is for EUR 300 million to be withdrawn from there under the item "effect and positives", Radev explained.

GERB-UDF Deputy Floor Leader Denitsa Sacheva told journalists that the draft State budget submitted by the Government is the only possible budget. “This is the reason it contains extremely difficult balances,” she added. “The budget will certainly encourage various protests, but it is the result of the support it can gather in Parliament,” Sacheva stated, commenting on the readiness of employers to protest. “This support comes from various political and parliamentary groups that have different views on how to run the country,” she specified. “We have been acquainted with the proposals of the employer organizations in advance, and I think it will be extremely difficult to draw up a new budget,” Sacheva argued. According to her, one of the main reasons for the planned budget expenditures is “the automaticity and interrelation between the minimum and average wages”. “We, as a political party, have committed to changing this, and it may happen next year,” she added.

Continue the Change - Democratic Bulgaria Co-Floor Leader Nikolay Denkov told journalists it is  possible to amend the draft State budget and reduce expenditures in several areas. He was commenting on the revisions requested by employers on the sidelines of a national conference for professions and sustainable future. According to him, the projected revenues are once again unrealistic, and once again a huge debt is planned. “The response we hear - that no other budget is possible - is a simple lie, and why this lie is being told is a question for those who are submitting the budget,” Denkov said.