New gaps snapped opened in Bulgaria’s state budget after a string of government-controlled companies unveiled unpaid debts and deficits of more than 1.2 billion leva, Deputy Prime Minister and Finance Minister Simeon Dyankov told Nova Television on October 12 2009.

The shortfalls should be plugged by state subsidies or other sources but the state will have limited room for maneuver if should stick to its bold cost-cutting plan designed to tame the impact of the economic recession.

At the same time, the 15 per cent reduction in public spending that took effect from August is placing an unbearable burden on ministries, agencies and other government bodies.

The trimmed subsidies are affecting current payments and stirring trouble with debt payments but only a handful of bodies have initiated radical reforms of their structures to match operating activities with the patchy budgets. But even that would not be enough to bridge the financial gap in some sectors.

Regional Development Minister Rosen Plevneliev yesterday announced a further 10 per cent spending cut following the 15 per cent slash in August and 10 per cent it shelved at the start of the year.

Several ministries polled by Dnevnik, including the finance ministry, said the fresh tide of cost-cutting measures will not affect all ministries.

Plevneliev said that the regional development ministry’s budget has been curbed from 100 million leva to about 78 million leva. He declined to reveal which of the planned expenses will be scrapped. The ministry has already accumulated a 132.5 million leva deficit on already signed road maintenance and repair projects.

Source: Dnevnik.bg