Finance Minster Plamen Oresharski said that only if 25 per cent of teachers would be made redundant in order to optimize the educational system, teachers' salaries increases, higher than what the Cabinet proposed could be discussed.

A new round of negotiations between teachers' unions and government failed to reach an agreement on October 7 2007.

Cabinet proposed a 32 per cent increase of teachers' salaries for 2008. The proposed increase would happen in two steps, 10 per cent on Januari 1 and July 1, plus two five per cent increases in differentiated salary for the same period, Dnevnik daily said.
According to calculations of the government, teachers' salaries in the sector would increase with over 50 per cent until the end of 2009.

Unions repeated their demand of a 100 per cent increase of salaries, to be implemented gradually before the end of 2008.

Economy Minister Petar Dimitrov and Oresharski said this would only be possible if teachers would be made redundant and taxes would be drastically raised, Dnevnik daily said. According to Dimitrov, in this case value added tax (VAT) would have be to raised from 20 to 22 per cent and the flat income tax rate would have to be over 15 per cent.

Teachers' unions responded that the remarks of the two ministers were speculations aimed at turning public opinion against the teachers, Dnevnik said. Unions countered a proposal to slim down government administration, which according to them was artificially bloated.

Teachers have been on an effective strike since September 24. The strike will continue into its third week after negotiations failed.