site.btaTripartite Council Holds Meeting, While Protesting Trade Unions Demand Markup of Wages

Sofia, October 27 (BTA) - Employers and trade unions came up with different opinions in respect of the bills on the state budget, the budget of the public social insurance and of the National Health Insurance Fund for 2018 which were discussed Friday at a meeting of the National Council for Tripartite Cooperation (NCTP).

The draft Public Social Insurance Budget Act envisages keeping the current system of payment of sickness benefits, Labour and Social Policy Minister Bisser Petkov said at the meeting. This means that 70 per cent of the contributory income will be covered by employers in the first three days of the sickness and as of the fourth day the National Social Security Institute will cover 80 per cent of it.

A proposal under which the employers' contribution should be reduced to 50 per cent was scrapped.

The Minister pointed out that the budget envisages a considerable increase of revenues from social security contributions by 16.1 per cent or 902 million leva, which is due to the one percent increase of the social security contributions, the growth of the average contributory income and the increase of the number of covered persons.

The budgeted expenditures within the Public Social Insurance Budget (PSIB) amount to 691,800.000 leva, i.e. the expenditures grow at a slower rate than revenues. The Minister recalled that as of July 1, 2018, pensions will be adjusted by 3.8 per cent due to the increased weight of the length of service in the pension calculation formula.

The 2018 PSIB bill envisages an increase of the amount of the social security contribution to the Pensions Fund by one per cent - 19.8 per cent for the persons born before January 1, 1960 as 11.02 per cent will be covered by the employer and 8.78 per cent - by the employee and 14.8 per cent for the persons born after December 31, 1959 with an employer/employee coverage ratio of 8.22/6.58 per cent.

The minimum contributory incomes will be increased with 3.9 per cent by administrative order. Along with the planned 10.9 per cent increase of the minimum wage, this would bring an average increase of the minimum contributory income by 6.8 per cent in 2018.

The minimum wage is increased from 460 leva to 510 leva. The minimum daily amount of the employment benefit is increased from 7.20 leva to 9 leva and the child benefits are raised from 340 leva to 380 leva.

Addressing the participants in the Council meeting, Finance Minister Vladislav Goranov said that Bulgaria is in a relatively favourable period of its economic cycle. However, an increase of the economic potential entails enhancement of the quality of the workforce, implementation of measures against the deteriorating demographic processes and an increase of investments in production.

The 2018 budget allows the country to perform normally its functions. It is the real sector of the economy and not the public sector that determines the rate of income growth, he observed.

The public social insurance budget is not supported by the employers due to what they describe as the crude interference of the state by the increase of the minimum contributory thresholds and the absence of badly needed measures, e.g. in respect of false sick notes, Chairman of the Association of Industrial Capital in Bulgaria Vassil Velev said. Vice President of the Bulgarian Industrial Association Dimiter Brankov said that the increase of salaries in unreformed sectors too sends out the wrong message.

The employers said that they are going to approach the Constitutional Court about the seniority bonus, saying that it is unconstitutional.

CITUB

The Confederation of Independent Trade Unions (CITUB), which had called a nationwide protest on Friday, does not support the public social insurance budget on account of "removal of rights" of the people, by means of the difficult access to short-term unemployment benefits, CITUB Executive Secretary Assya Goneva said. Goneva said that the trade union finds as too small the increment of the pension increase next year. The trade union wants "a braver step" in increasing the weight of the length of the contributory service in the pension formula, making it 1.2 "so that people see that their contributory contribution is of essence".

The trade union thinks that some of the state-financed sectors remain underfinanced and insists on a ten per cent increase of all salaries in the state-financed sphere.

At the rally CITUB insisted on an increase of salaries by at least 100 leva next year. The protestors marched from the St. Alexander Nevski Cathedral through the Council of Ministers to the headquarters of the Association of Industrial Capital.

Prime Minister Boyko Borissov, Finance Minister Vladislav Goranov and the CITUB leadership are expected to hold a meeting immediately after Borissov returns from Bosnia and Herzegovina, CITUB President Plamen Dimitrov said before the protestors in front of the Council of Ministers building. This was confirmed by Minister Petkov with whom the trade unionists had a talk before that. Dimitrov presented the organization demands to the NTCP.

Dimitrov explained that at the upcoming meeting with the Prime Minister and the Finance Minister, the trade unions will present their demands for a markup of salaries sector by sector. He said that additional 100 million leva will be needed for at least 10 per cent increase of salaries in the public sector.
Attending the protest were around 8,000 people.