The Bulgarian government is working on the budget for the next three years and the 2007 budget, Labour and Social Policy Minister Emilia Maslarova said.

So far all economic parametres for the first three months of 2006 have been fulfilled and the country discusses with European partners all problematic areas, including the social sphere, Focus news agency reported.

EU wants clarity on the country's economic situation and a stable labour market progress. EU members have to be assured Bulgaria's accession will not be followed by excessive worker migration, Maslarova said.

Unemployment falls down steadily and the lowest unemployment rate for the last 15 years was registered at the end of March. It fell below 11 per cent, provided even some EU member states have rates over 12 per cent.

Although the labour market is stable, national income policy remains problematic. Unlike EU member states, Bulgaria still has low labour productiveness and the GDP growth rate exceeds officially declared income growth rate.

By the end of May labour unions, employers and the government will sign a pact for economic and social development until 2009 stating a clear income and employment strategy.

Major reforms are required in the pension system. The minister proposes raising the minimum pension to 55 per cent of the minimum wage.