Despite the calls from opposition MPs hold tight onto budget surplus funds as a cushion against a backlash from global financial turmoil on Bulgarian economy, three parliamentary committees – budget, economic policy and transport – backed on October 8 the budget surplus spending proposal of the Bulgarian Government and appeared for questioning in Parliament.

The Government offered to spend 666 million leva on social benefits and the remainder – on investment projects of strategic importance. Out of the social package, the lion’s share – 337.5 million leva – would go for one-off Christmas pay to pensioners, who would each receive 150 leva bonuses. Yet another 90 million would go to retroactively raise pensions.

The bulk of the investment package will go the Railroad Infrastructure National Agency. It will receive 180 million leva in budget loans, and will likely get a further 120 million leva out of the 350 million leva that the Government may spend without needing parliamentary approval.

The opposition insisted that the entire budget surplus be re-directed to the Silver Fund, meant to shore up the pension system, and lamented over Bulgarian Prime Minister Sergei Stanishev’s failure to attend the parliamentary debate.

Responding to a journalistic query, Stanishev said the local banking system enjoyed stability that has been backed with high reserves and duly guaranteed deposits. Should deposits need to be given extra guarantees, the Government alongside the Bulgarian National Bank (BNB) would take due measures, Stanishev was quoted by Bulgarian news agency BTA as saying.

Opposition party Bulgarian National Union urged to set up an anti-crisis commission and reiterated it was high time the Government drafted measures to avert a financial crisis scenario.

Rightist Union of Democratic Forces said Budget Bill 2009 did not consider a crisis scenario and was as lavish as to spend the entire budget surplus accumulated in 2008.

Roumen Ovcharov, the Socialist MP that chairs the parliamentary budget committee, said that the state would readily intervene and guarantee the stability of banks and the fiscal system as a whole if Bulgaria falls into recession.

He said that the state guaranteed individuals’ deposits of up to 40 000 leva, the fiscal reserve was at 11.2 billion leva and the foreign currency reserve at 28 billion leva.

Leader of rightist opposition party Democrats for a Strong Bulgaria, Ivan Kostov, retorted that Ovcharov had been for years the voice of irresponsibility, BTA reported. He added the claim of BNB governor Ivan Iskrov that the banking system in South-Eastern Europe was stable was irrelevant given the fact that just days ago Greek prime minister Costas Karamanlis gave full guarantee for the deposits of all Greek banks.