[size=85:11pbmeut]Dnevnik 07 September 2010

Labour minister proposes higher bottom wage from 2011

Bulgaria’s labour minister Totyu Mladenov will proposed an increase of the minimum wage to BGN 270 from 2011 from the current level of BGN 240.

Speaking to state-run radio channel BNR on Friday, Mladenov said that he will ask the Economic Development Council under the Council of Ministers to come up with a stance on the matter.

The Ministry of Finance (MoF) included no rise in salaries allocations in the budget calculations for the next two years.

Mladenov told Darik Radio that he has proposed two bottom wage rise options and the finance ministry said this was an “open issue.”

National Social Security Institute (NSSI) chairperson Hristina Mitreva also said that the minimum wage could be lifted by at least BGN 30. Both she and Mladenov three months ago said that the decision to raise the bottom salary was up to employers and unions and promised that the government would not interfere.

Now Mladenov argues that the current net income of the lowest-paid workers is BGN 211, which is beneath the poverty line. He predicted that the increase would translate into higher bottom social security thresholds. In an interview for 24 Chasa, Mitreva proposed lifting the social security ceiling to BGN 2,200.

The increase in the minimum salary would boost revenue in Bulgaria’s social security system by BGN 20 million in 2011, whereas public spending will go up by BGN 25 million, according to Mladenov.

Unofficial reports claim that the labour ministry is already seeking a BGN 35 million increase for 2011 to cover welfare payments for a possible increase.

[size=55:1aotdddp]novinite 17 October 2010

Bulgaria Marks Poverty Eradication Day as EU Poorest State

As the world observes the International Day for the Eradication of Poverty on October 17, statistics show that Bulgaria continues to be the European Union poorest country as more than half of the population grapple with financial difficulties every day.

Issuing a press release in view of the International Day for the Eradication of Poverty, the UN called on all nations to strive to expand job opportunities and provide safe working conditions for all.

"
This year's theme – from poverty to decent work: bridging the gap- focuses attention on decent work, meaningful employment, income-generating livelihoods or in one word: jobs,"
the statement reads.

"
This is more important now than ever, when the global economic crisis has pushed an estimated 64 million people into poverty and unemployment is up more than 30 million since 2007. More than half of the worlds' working population continues to be in vulnerable employment, where they lack formal working arrangements and social security, and often earn little to provide for their families."


The message also emphasizes on youth employment as young people are three times more likely to be unemployed than adults.

Bulgaria is the European Union's poorest country and it is now going through its first recession in 12 years after a three-year lending boom stalled and foreign investments dried up.

Two decades after the collapse of the communist regime, the average wage in the nation of 7.5 million people was USD 411 in 2009, far below the average salaries in the Czech Republic and Poland, where it is over topped USD 1,000.

Bulgaria's per-capita GDP totaled USD 5,916 last year.

The recovery of the Bulgarian economy, which operates in a currency board regime, is lagging behind that of other Eastern European countries. The government has pledged to stick to a tight fiscal policy and keep the deficit below 3 % by the end of this year.

The cabinet adopted earlier this year a package of austerity measures, freezing public pays and pensions in a bid to reduce the bloating deficit.

It revised up to 1% its economic growth forecast for this year, pinning its hopes on a boost in exports.

Bulgaria’s policy to combat poverty and social exclusion

The European year for combating poverty and social exclusion is almost at its end. Poverty can be related to insufficient income to cover every-day costs, but it can also mean limited access to healthcare, education and culture. Europe’s common goal for 2020 is to reduce the number of poor Europeans by 20%.

The poverty dimensions in Bulgaria are somewhat alarming. Out of 7.5 million population, some 1 200 000 Bulgarians are living under the poverty line, which for a second year in a row is around 106 Euro. Although the government is looking for EU funding, perhaps the best way to cope with poverty is economic growth. The country also needs an adequate social assistance policy for those in need. According to Bulgaria’s Social Minister Totyu Mladenov, Bulgaria aims to reduce the number of poor Bulgarians by 260 000 people by 2020. Therefore, state policy will focus on unemployment, retired people, poverty-stricken workers, as well as disabled people. The government’s goal is to give these groups opportunities for an active life, since social assistance is not the only way to combat poverty. In this context, Bulgaria’s law for the inclusion of disabled people is introducing a new kind of financial support for these groups as of next year. What is more, some 130 public dining rooms across the country offer to the poor warm food in the winter season. Since child poverty is also a grave problem, the country aims to extend services to poor children and families via the EU Human Resources Development Programme. We offer you next an interview with Social Minister Minister Totyu Mladenov:

“We have launched a project to the tune of 40 million Euro to support municipalities in offering services to the most vulnerable children and families, disabled children included. We will also be funding projects for risk prevention for children, as well as for pre-school preparation and parent support. This year we also stated a project that aims to provide family environment for handicapped children deprived of parental care. We are going to close down Bulgaria’s social-care centres only after we have made sure there are enough homes for these children. The money earmarked to this end under the EU Human Resources Development Programme is some 14 million euro. We also secured about 1.4 million Euro in order to prolong the programme for the maintenance of state-run dining rooms all over the country”, Bulgaria’s Social Minister Totyu Mladenov said for Radio Bulgaria.

In his words, providing employment for people through training programmes, as well as qualification and pre-qualification programmes is a most important element in the combat against poverty and social exclusion. Therefore, the minister pointed out, the government will aim to bolster entrepreneurial initiatives. The jobless people will be encouraged to actively look for work, too

21% Bulgarians at Risk of Poverty

About 21% of the Bulgarian population is at risk of poverty, an Eurostat publication "
Income and living conditions in the Europe"
for 2008 showed.

The publication from the statistical office of the European Union is based on data from the EU-SILC survey, which is the EU reference source for comparative statistics on income, distribution, poverty and living conditions.

It measures three indicators: persons at-risk-of poverty, severely materially deprived persons and persons living in households with very low work intensity.

In 2008, 21,4% of the Bulgarians were at-risk-of poverty. The only countries that had higher rates were Latvia (26%) and Romania (23,4%). The countries with the lowest rates were the Czech Republic (9%), the Netherlands (10,5%) and Slovakia (10,9%).

Bulgaria and Romania were also the countries with the highest rate of materially deprived persons, with 41,2% and 32,9% respectively. The share is the lowest in Luxembourg (0,7%), Sweden (1,4%), the Netherlands (1,5%), Denmark (2%) and Spain (2,5%).

Bulgaria ranked in the middle of countries for households with low work intensity, with 8,1%. The countries which had the largest proportions of those living in low work intensity households are Ireland (13,6%), Hungary (12%), Belgium (11,7%) and Germany (11,6%), while those with lowest are Cyprus (4,1%), Luxembourg (4,7%), Latvia (5,1%), Lithuania (5,1%), Slovakia (5,2%), Estonia (5,3) and Sweden (5,4%).

The first place for countries which have the highest rate of people who fall under all three criteria are held by Bulgaria (44,8%), Romania (44,2%), Latvia (33,8%) and Poland (30,5%), while the lowest are the Netherlands (14,9%), Sweden (14,9%), the Czech Republic (15,3%), Luxembourg (15,5%) and Denmark (16,4%).

The publication was issued in connection with the closing conference of the European Year for Combating Poverty and Social Exclusion, which takes place in Brussels on December 16-17, 2010.

Prices and income in Bulgaria, according to CISB experts

More and more Bulgarians are falling below the poverty line. Last year the cost of living in the country went up by 6.4%, according to the Institute for Social and Syndicate Surveys with the Confederation of Independent Syndicates in Bulgaria (CISB). In 2010 the prices of the bare essentials and vital services soared, it also emerged. There has been a serious increase in the prices of flour, bread, cheese and some vegetables, as well as gas, electricity and solid fuels. Car fuel prices have jumped by 21%. At the same time, Bulgarian salaries have remained at their 2009 level, or have decreased.

“With prices dynamically rising, the households’ income were not only showing a tendency for stagnation, but were also decreasing in the third quarter of 2010”, Luyben Tomev, Head of the Institute for Social and Syndicate Surveys with CISB said. “Despite claims that the average salary is rising, obviously, the high percentage of unemployment affects badly the earnings of the family budget. The scraping-by situation of Bulgarian households is caused by both ever-increasing prices and a nominal decline of their income”, Lyuben Tomev said.

In late 2010 a four-member Bulgarian family needed some 1000 Euro to cover its costs of living, experts estimated. There were only very few Bulgarian families that had that income. Therefore, many households resorted to savings or to a tight budget covering only the bear essentials. What is more, if a family had a credit loan, it would hardly pay it back. Some 18% of taken loans have been estimated as “bad”. According to Lyuben Tomev, 27% of Bulgarian households are now living below the poverty line, while in the years prior to the crisis this figure was 21%. Here is more from him:

“There are two trends. As poverty is expanding its basis, so it is deepening. In other words, the poor get even poorer as compared to the people with high incomes. The polarity in society is growing. According to CISB, the average salary in 87% of Bulgarian companies has not changed. In the other 3% salaries have grown, hence production and sales. At the same time, last year the unemployed rose by 313 000 people, of whom only 120 000 have been registered in public employment agencies. The rest falls into the category of the discouraged -some of them find a place in the grey economy, while others emigrate. According to CISB President Plamen Dimitrov, syndicates propose an increase of the minimal wage worth 145 Euro as of 1 July, as opposed to the current one (120 Euro). The second thing syndicates will offer to employers and the government is the reintroduction of a national minimum index for the growth of salaries. Higher labour incomes will increase domestic consumption, which is one way to overcome the crisis. “We think it is high time we spoke about a minimal wage growth index, despite the still fragile indicators for growth in some spheres of the economy”, Plamen Dimitrov said. In his view, this will be one factor for boosting the domestic market, which is depreciated at the moment.