The parties in the ruling tripartite coalition failed reaching an agreement if pensions should increase by 10 per cent starting July 1 2007.

Recently some of the coalition partners disagreed with the Bulgarian Socialist Party’s (BSP) proposal to introduce the increase, Novinar newspaper reported.

National Movement Simeon II (NMSII), the second party in the ruling coalition, said that BSP’s suggestion was a populist move. NMSII said that the increase was unfounded and blamed BSP for taking decisions on its own.

Pension increase was likely only if privatisation revenue or budget surplus provided additional funds, NMSII said.

NMSII spokesperson Stanimir Ilchev said that the decision was hasty and could only lead to social tension.

The third ruling formation, Movement for Right and Freedom (MRF), failed coming up with unified position on the issue. One of its members said that BSP was taking Bulgaria back in time, while other MRF representatives supported the project.

Deputy Finance Minister Georgi Kadiev said that a decision on pension increase will be taken once Cabinet evaluated some of the budget income for the year.