10.6092/issn.1561-8048/15701
Bulgaria is still in the early stages of implementing the National Recovery and Resilience Plan. Because of the unstable political situation since 2020 the European Commission approved the Plan only at the end of May 2022. Furthermore, more than 22 laws and 60 strategies are necessary for implementation, and the current uncertainty very few steps are being taken. According to the RRP, the main tasks facing Bulgaria are education and qualifications, research and innovation, strengthening small and medium-sized enterprises, developing a decarbonised economy, sustainable agriculture paying attention to biodiversity, digitalisation, sustainable transport, development of local self-government, the environment, social inclusion, and health care. They are analysed in detail in this chapter in accordance with the activities of national institutions.
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National Recovery and Resilience Plan: Bulgaria
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10.6092/issn.1561-8048/15701
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National Recovery and Resilience Plan: Bulgaria
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    National Recovery and Resilience Plan:                                       Italian Labour Law e-Journal
    Bulgaria                                                                    Special Issue 1, Vol. 15 (2022)
    Krassimira Sredkova                         The NextGeneration EU in Action: Impact on Social and Labour
    Albena Velikova-Stoyanova                                                                          Policies
    sredkova@admin.uni-sofia.bg                                                               ISSN 1561-8048
    alvels@abv.bg                                              https://doi.org/10.6092/issn.1561-8048/15701




          National Recovery and Resilience Plan: Bulgaria
            Krassimira Sredkova- Albena Velikova-Stoyanova+

                                                Abstract

     Bulgaria is still in the early stages of implementing the National Recovery and Resilience Plan.
     Because of the unstable political situation since 2020 the European Commission approved the
     Plan only at the end of May 2022. Furthermore, more than 22 laws and 60 strategies are
     necessary for implementation, and the current uncertainty very few steps are being taken.
     According to the RRP, the main tasks facing Bulgaria are education and qualifications, research
     and innovation, strengthening small and medium-sized enterprises, developing a decarbonised
     economy, sustainable agriculture paying attention to biodiversity, digitalisation, sustainable
     transport, development of local self-government, the environment, social inclusion, and health
     care. They are analysed in detail in this chapter in accordance with the activities of national
     institutions.

     Keywords: Bulgaria, Investments, Plan, Reforms, Resources, Strategies.




1. General framework.

    Bulgaria is one of two countries whose Recovery and Resilience Plan (RRP) was approved
by the European Commission (EC) only at the end of May 2022. This is because of the
unstable political situation since 2020. In 2021, the country had two caretaker governments,
parliamentary elections and a regular government only from December 2021. The latter,
however, was subject to another vote of no confidence in June 2022 and now the political
situation is complicated and unstable once again. This means that our focus will be on ideas
and intentions declared by the government, but without practical measures for
implementation. The main objectives are the efforts towards economic and social recovery
from the Covid-19 pandemic, and the creation of a more sustainable, fair and prosperous


  Professor of Labour Law and Social Insurance, Sofia University ‘St Kliment Ochridski’. President of the
Bulgarian Association of Labour Law and Social Insurance (Sofia, Bulgaria).
+
  Assistant Professor of Labour Law and Social Insurance, Sofia University ‘St Kliment Ochridski’ (Sofia,
Bulgaria).
 Krassimira Sredkova                                                    Italian Labour Law e-Journal
 Albena Velikova-Stoyanova                                             Special Issue 1, Vol. 15 (2022)
                                                         The NextGeneration EU in Action: Impact on
                                                                           Social and Labour Policies




economy. It is also necessary to lay the foundations for digital and green transformations of
the economy within the framework of the European Green Deal.
    The Covid-19 pandemic has created a high degree of uncertainty in all walks of life.
Therefore, first of all, it is necessary to assess how it is being tackled, as well as its
consequences and the emerging possible new health crisis. The government believes that it
should boost the resilience of the health care system and ameliorate the socio-economic
consequences of the pandemic through measures to strengthen enterprises, increase
employment, and ensure health and safety at work.
    It should be noted that Bulgaria’s real GDP fell by 4.4 per cent in 2020 and by 0.4 per
cent in 2020 and 2021 combined. The poverty and income inequality rate is one of the highest
in the EU. Bulgaria has the most carbon- and energy-intensive economy in the EU.
    Improving the quality of government institutions and combating corruption continue to
be major challenges for Bulgaria. Labour and skills shortages, as well as skills mismatches in
the labour market, are also a significant barrier to economic investment and constrain labour
productivity growth. The introduction of digital technologies is progressing slowly in both
public and private sectors.
    The Recovery and Resilience Plan (RRP) for Bulgaria as an EU Member State is part of a
key Community tool for economic and social recovery from the Covid-19 pandemic, namely
NextGenerationEU (2021–2024). The country’s recovery and resilience strategy is based on
Bulgaria’s National Development Programme 2030. This document sets out the national
solutions for growth and development. It defines as its strategic goals accelerated economic
development, demographic upswing and reduction of inequalities, for the implementation of
which 13 national priorities have been identified. Some 22 laws and more than 60 strategies
must be adopted in order to implement the RRP. That is why we are unable to go into much
detail in this presentation.
    As long ago as the summer of 2020, the Bulgarian government was actively involved in
preparing and adopting the multi-year financial framework and the new ‘NextGenerationEU’
instrument, brought into being at the proposal of the European Commission. This is aimed
at a sustainable, coordinated and fair recovery of the EU Member States from the Covid-19
pandemic. All the competent national bodies have striven to ensure implementation of this
instrument.


2. The RRP: an overview.

   Concerning the sums requested, in the wake of the European Council of 17–21 July 2020,
the financial package envisaged for Bulgaria was set indicatively at around 6.217 billion euros
(€) in grants and €4.549 billion in loans. It appears from what is known about the
consultations held in the country between July 2020 and June 2022 that Bulgaria does not
plan to take advantage of the opportunity for loans.




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    Krassimira Sredkova                                                            Italian Labour Law e-Journal
    Albena Velikova-Stoyanova                                                     Special Issue 1, Vol. 15 (2022)
                                                                    The NextGeneration EU in Action: Impact on
                                                                                      Social and Labour Policies




    On 6 November 2020, a first draft1 of the Plan was submitted to the European
Commission in accordance with the guidelines for preliminary consultations with
Commission Services. After this it took a long time to get the final version of the plan
approved, along with the relevant funding. On 4 May 2022, the European Council approved
the assessment of the plan. The allocation of contributions in accordance with the
agreements on financial contributions is subject to available funding and a Commission
Decision adopted under Art 24 of Regulation (EU) 2021/241 stated that Bulgaria has
satisfactorily passed the relevant milestones and targets set out in relation to RRP
implementation. On 30 June 2022, the European Commission reduced the total amount of
grants under the RRP to €5.6 billion (a reduction of €578 million).2 This amount corresponds
to the funds allocated after deducting Bulgaria’s proportional share of the expenses under
Art. 6, par. 2 of Regulation (EU) 2021/241, calculated in accordance with the methodology
under Art 11 of this Regulation. An amount of €4.636 billion is available for entering into a
legal commitment until 31 December 2022. If the update provided for in Art 11, para 2 of
Regulation (EU) 2021/241 resulted in an updated maximum financial contribution for
Bulgaria, equal to or higher than €6,267 billion, an additional amount of €1.631 billion shall
be made available for entering into a legal commitment from 1 January 2023 until 31
December 2023. While this update results in an updated maximum financial contribution for
Bulgaria of less than €6.267 billion, the difference between the updated maximum financial
contribution and the amount of €4.636 billion shall be made available to cover legal
commitments in accordance with the procedure provided for in Art 20, para 8 of Regulation
(EU) 2021/241, from 1 January 2023 to 31 December 2023.
    The agreement between the European Commission and the Republic of Bulgaria for
financing under the Recovery and Resilience Facility was signed on 30 May 2022, and on 13
July the National Assembly of the Republic of Bulgaria passed a law on the ratification of
this agreement (SG No 57 of 22 July 2022). With the ratification of the Agreement the
financial implementation of the RRP started and a statutory basis was created to ensure the
effective implementation of the planned reforms and investments in Bulgaria. All this is a
prerequisite for submitting a first request for payment to the European Commission. The
operational arrangements are about to be signed. These will provide the necessary basis for
establishing implementation of the various milestones and targets, as well as indicate how
the Commission will engage and work together with Bulgaria to monitor the plan’s execution.
    After the Council had approved the Plan, a management and control system was created
in Bulgaria, an analysis of the workload of the key authorities was carried out and the
information system for management and monitoring of EU funds (ISUN 2000) necessary
for the management of the plan was upgraded. The first procedure under the programme



1 This draft was published for public consultation on the portal for public consultations: www.strategy.bg.
Five interactive presentations of the first project were organised. The first presentation was a general one for
the entire plan. Four interactive consultations were held, dedicated to the four pillars of the plan.
2 Commission note to the Council and European Parliament, RRF: Update of the maximum financial contribution,

30 June 2022.

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 Krassimira Sredkova                                                    Italian Labour Law e-Journal
 Albena Velikova-Stoyanova                                             Special Issue 1, Vol. 15 (2022)
                                                         The NextGeneration EU in Action: Impact on
                                                                           Social and Labour Policies




for technological modernisation has already been announced, with BGN 260 million to
support small and medium-sized enterprises.
   According to the RRP, the main tasks facing Bulgaria are education and qualifications,
research and innovation, strengthening of small and medium-sized enterprises, decarbonised
economy, biodiversity and sustainable agriculture, digitalisation, sustainable transport,
development of local self-government, environment, social inclusion, and health care. In
addition, the government and the Parliament have set out other very important tasks,
including reform of the judicial system, improving the fight against corruption and enhancing
the capability of the armed forces. Clearly analysing the numerous and extremely important
tasks under the programme is beyond the scope of this paper, so our attention will be focused
on social policy issues.
   Bulgaria’s plan is structured in terms of four of the six pillars of the Resilience Recovery
Facility: “Innovative Bulgaria”, “Green Bulgaria”, “Connected Bulgaria” and “Fair Bulgaria”.
It contains measures that contribute to all six pillars, with almost all of its components
targeting several pillars simultaneously. According to the Commission’s assessment, such an
approach helps to ensure that each pillar is addressed comprehensively and consistently.
   The plan lays the foundations for green and digital transformations of the economy. The
measures envisaged for the green transition account for more than 58.9 per cent of total
planned expenditures, while 25.8 per cent of the funds will be allocated to digitalisation.
   The health, economic, social and institutional resilience pillar includes measures to
improve access to education, lifelong learning and health care, as well as promote social
inclusion. Education and training provisions include measures to increase the use of higher
education to address labour market shortages and promote research, as well as create a
platform for lifelong learning. Health care measures include the adoption of a new national
health strategy, implementation of the national health information system and construction
of a network of outpatient care units, supported by a reform addressing the unbalanced
geographical distribution of health care professionals. To promote social inclusion, the RRP
includes reforms to improve the coverage and adequacy of the minimum income scheme
and measures concerning social services, including long-term care. Social cohesion is
expected to be promoted through reform of the minimum income scheme benefitting adults
and children, investment in the social economy, modernisation of social and employment
services and provision of telemedicine and e-government services in remote areas by
repurposing the postal network. The plan will help ensure the ongoing implementation of
policies for the next generation, with measures such as mandatory inclusion of four-year-
olds in pre-school education; modernisation and construction of educational infrastructure,
including kindergartens and school laboratories, as well as opening youth centres throughout
the country.
   Many of the reforms needed in Bulgaria impact on the labour market, employment
protection, social protection/welfare and social assistance.
   Measures aimed at improving employability by strengthening skills, including digital ones,
are also expected to have an impact on the labour market. Access to teleworking is expected
to be improved through the planned measures under the components “Digital Connectivity”

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    Krassimira Sredkova                                                    Italian Labour Law e-Journal
    Albena Velikova-Stoyanova                                             Special Issue 1, Vol. 15 (2022)
                                                            The NextGeneration EU in Action: Impact on
                                                                              Social and Labour Policies




and “Business Environment Reform”. To protect employment, measures are foreseen under
the components “Investment” and “Modernisation of the Employment Agency”.
    Strengthening active labour market policies is planned through measures under the
components “Education and Skills, Investment” and “Provision of digital skills training and
setting up a platform for adult learning”. As regards employment, the Ministry of Labour
and Social Policy is constantly developing programmes and measures for training,
methodologies for improving adult learning and other policy instruments. The Ministry
implements policy on the labour market, workforce training and integration of disadvantaged
groups. It also analyses labour market information and the results of active labour market
policies, and organises surveys of employers’ needs for qualified workers. Implementation of
the specified tasks is laid out in the Employment Strategy, the National Reform Programme
and the National Employment Action Plans.
    Measures under “Education and Skills” are planned to promote equal access to education.
They require improvements in the conditions of access to primary education, upgrading
digitalisation in education and reform of higher education. Measures related to education and
skills, including digital skills, should increase socio-economic resilience by addressing
persistent and significant skills shortages and strengthening employability and productivity.
    Measures for social assistance, access to education and health care will have an impact on
the social protection and welfare system. Social inclusion measures are planned to improve
access to integrated social and employment services under the “Social Inclusion” component.
    To support the minimum income, measures are planned to change the rules concerning
social assistance and the adoption of accessibility and adequacy criteria. This assistance must
be defined based on the poverty line for the correspondent year and not, as hitherto, based
on a guaranteed minimum income.3 The planned change will enable more people to obtain
assistance.4 Changes in the system of monthly social assistance will help to solve problems
arising from poverty. Raising the social assistance floor, however, has the risk that social
assistance becomes too inviting for some people who are able to work, but do not want to.
    That is why changes in active labour market policy will also be very important, such as
encouraging employers to hire the long-term unemployed by financing minimum income
schemes (under government programmes money would be granted to employers to cover
wages and social insurance contributions for the employment of different groups of
unemployed, such as young people and the disabled).
    Another strategic objective of social policy is the protection of social security and other
social rights. Legislation continues to evolve to meet the challenges that Bulgaria faces.
    Efforts are directed towards finding balanced and lasting solutions for a wide range of
issues in order to increase revenue to the social insurance system (which will ensure its
adequacy and resilience) and limit its costs. It is also important to adapt the pension system
to the emerging demographic and socio-economic conditions, as well as [to secure] the
sustainable growth of pension income in accordance with economic growth.

3 The guaranteed minimum income is now defined by the Council of Ministers and is BGN 75 (€38). The
poverty line for 2022 is calculated as BGN 413 (€207).
4 While at present 63,000 people can receive assistance, by 2025 their number may be 115,000.



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 Krassimira Sredkova                                                       Italian Labour Law e-Journal
 Albena Velikova-Stoyanova                                                Special Issue 1, Vol. 15 (2022)
                                                            The NextGeneration EU in Action: Impact on
                                                                              Social and Labour Policies




   Improving access to health services (by providing financial resources to strengthen the
resilience, accessibility and capacity of the health system, including by reducing out-of-pocket
payments and addressing shortages of health professionals) will be achieved by implementing
measures planned under the “Health Care” component.


3. The social and labour dimensions of the RRP.

    In the evaluation made in accordance with Article 19 (3) and the criteria laid down in
Annex V of Regulation (EU) 2021/241, the RRP has been assessed by the European
Commission and the Council as a balanced response contributing to the six pillars under Art
3 of Regulation (EU) 2021/241 and as addressing all or a significant part of the challenges
identified in the Country Specific Recommendations. The contribution to growth potential,
job creation and economic, social and institutional resilience is explicitly stated. It is asserted
that the Plan includes significant reforms and investments to support the economic, social
and territorial cohesion, which contribute to better compliance with the European Pillar of
Social Rights. The envisaged measures are expected to help to increase social resilience to
shocks, reducing social inequalities and creating opportunities for the most vulnerable groups
to enter the labour market. Measures in education are expected to support equal access to
quality education and training and to reduce early school leaving rates. In addition, health
care measures are expected to strengthen the responsiveness and accessibility of health care
and contribute to improving the geographical distribution of health professionals.
    In accordance with the economic, political and social situation in Bulgaria and in
accordance with the requirements of the European Pillar of Social Rights and the Social
Scoreboard, the RRP includes reforms and investments in support of economic, social and
territorial cohesion, which contribute to implementation of the principles of the European
Pillar of Social Rights in all three areas around which they are structured. These are: equal
opportunities and access to the labour market; fair working conditions; and social protection
and inclusion. The data collected from previous years for all 12 indicators included in the
Social Scoreboard make it possible to identify the main social problems and to choose the
means of meeting national targets pertaining to the European Pillar of Social Rights.
    The projects included in the RRP will promote equal opportunities for all, while
respecting the principle of ensuring equal participation of men and women whenever
possible, as well as non-discrimination on the grounds of gender, race, ethnicity, religion or
belief, disability status, age and sexual orientation. The reporting of microdata and target
groups for individual projects will provide data disaggregated by gender, age, disability status
and ethnicity, where possible.
    Reforms and investments are expected to improve equal access to quality education and
encourage participation in early childhood education by promoting the personal
development of young people, and establishing youth centres, among other things. The plan
is focused on the modernisation of schools, including setting up science, technology,


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    Krassimira Sredkova                                                   Italian Labour Law e-Journal
    Albena Velikova-Stoyanova                                            Special Issue 1, Vol. 15 (2022)
                                                           The NextGeneration EU in Action: Impact on
                                                                             Social and Labour Policies




engineering and mathematics laboratories to ensure ongoing adaptation to emerging
challenges, and in particular to digitalisation.
   The Recovery and Resilience Plan is expected to help create jobs and foster Bulgaria’s
economic, social and institutional resilience, including by promoting policies for children and
young people, as well as mitigating the economic and social impact of the Covid-19 crisis.
The overall aim is to enhance economic, social and territorial cohesion and convergence
within the EU.
   To mitigate social vulnerability, it is planned to improve the system of social assistance,
in particular through the reform of the minimum income scheme and the modernisation of
long-term care for the elderly and people with disabilities.
   Large-scale reforms and significant funding by component are foreseen as regards
implementation of the recommendations formulated in the 20195 and in the 20206 cycles of
the European Semester.
   Out of the four groups of recommendations for 2019, two contain recommendations that
are of direct social application. Regarding Specific Recommendation 3, Bulgaria should direct
investment policy towards scientific research and innovation. Under Component 2, measures
on scientific research and innovation are planned. Regarding Specific Recommendation 4,
employability should be improved by strengthening skills, including digital skills.
   Out of the four groups of recommendations for 2020, two have a direct social aspect.
Regarding Specific Recommendation 1, in line with the general escape clause, Bulgaria shall
take all necessary measures to tackle the pandemic effectively, sustain the economy and
support the ensuing recovery. Various measures are planned in order to mobilise adequate
financial resources to strengthen the resilience, accessibility and capacity of the health system,
and ensure a balanced geographical distribution of health workers.
   In order to comply with these recommendations, the RRP attaches particular importance
to equality between individuals and different groups in society. The main strategic document
concerning gender equality is the 2021–2030 National Strategy for Promoting Equality
between Women and Men. Its priority areas include the following: the equality of women
and men in the labour market and an equal degree of economic independence; reducing the
gender pay and income gap; promoting equality of women and men in decision-making
processes; combating violence and protecting and supporting victims; and overcoming
gender stereotypes and sexism in various spheres of public life. For each priority area, key
activities for making progress are indicated. The challenges of achieving equality between
women and men in the labour market require measures to boost employment; access to
education, vocational training and various forms of lifelong learning; improving occupational
qualifications and key competences; and enhance compliance monitoring with regard to
labour legislation.
   Particular efforts are devoted to vulnerable groups who are at risk of social exclusion and
who, because of their social status, have the lowest social resilience to shocks. Poverty and


5   OB C 301, 5 September 2019.
6   OB C 282, 26 August 2020.

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    Krassimira Sredkova                                                            Italian Labour Law e-Journal
    Albena Velikova-Stoyanova                                                     Special Issue 1, Vol. 15 (2022)
                                                                    The NextGeneration EU in Action: Impact on
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social exclusion are serious challenges, and income inequality is high. Social transfers have a
limited impact on reducing poverty and inequality. They are well targeted, but their coverage
is not sufficient and they make little contribution to improving the condition of beneficiaries.
    Essential to tackling social inclusion are the National Reform Programme and the national
position on the Specific Recommendations to the Member States in the area of poverty
reduction and the promotion of social inclusion within the framework of the European
Semester. In implementing the Action Plan for the implementation of the European Pillar
of Social Rights and the European target to reduce poverty by 2030, Bulgaria has set as a
national target to reduce the number of people at risk of poverty or social exclusion by
787,000 people by 2030. A National Council on Social Inclusion was established at the
Council of Ministers in order to carry out coordination, cooperation and consultation in the
development, implementation, monitoring and evaluation of state policy on social inclusion.
    This part of the Plan is in line with the Council’s Country Specific Recommendations for
2019 and 2020 and will contribute directly to the implementation of Specific
Recommendation 2 of 2020, as well as Specific Recommendation 4 of 2019. The planned
reform to improve the overall system of social support through codification is intended to
overcome the structural challenges hindering social policy in its efforts to reduce poverty and
inequalities. For the purpose of implementing social services reform and the project for the
modernisation of long-term care7 it is envisaged to build and equip new, integrated social and
health social services for residential care, accompanied by specialised and consultative social
services for people with disabilities. Existing homes for the elderly should also be reformed.
    The project has a specific component for increasing the energy efficiency of social
infrastructure.
    Projects for the provision of assistance to people with permanent disabilities and the
measure envisaging expanding and modernising opportunities to support operators in the
social and solidarity economy will also contribute to economic recovery, given the
opportunities created for representatives of vulnerable groups to join the labour market. This
is apart from their undeniable effect in terms of strengthening social resilience. Most of the
planned investments will have a lasting impact; in other words, their effects will continue
after completion of the respective projects.
    Reform to develop e-health and the National Health Information System is very
important. The objectives set out in sub-priority 12.3 ‘E-Health’ are related to the application
of digital technologies to improve the quality of health services and access to medical
services. The objectives will be achieved through the introduction of centralised e-health
services, including a health information system, health profiles, health records and
monitoring, telemedicine, prescriptions and health administrative services.
    Reforms and envisaged investments in education are expected: to help reduce the
proportion of students aged 13–14 with low computer literacy; to increase the proportion of

7 Project implementation will support 332 units of social infrastructure in the process of deinstitutionalising
long-term care services for the elderly and people with disabilities, as well as 840 social services units. Total
planned resources amount to BGN 753.0 million (BGN 643.2 million from the Recovery and Resilience Facility
and BGN 109.8 million of national co-financing). The implementation period is 2022–2026.

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    Albena Velikova-Stoyanova                                                    Special Issue 1, Vol. 15 (2022)
                                                                   The NextGeneration EU in Action: Impact on
                                                                                     Social and Labour Policies




people aged 16–74 with basic digital skills; to boost the share of adults taking part in annual
training; as well as to increase the proportion of vocational education and training graduates
who enter employment and those involved in job-based vocational education and training.
    All the measures envisaged for the implementation of the Specific Recommendations of
the Council for 2019 and 2020 are also aimed at enhancing scientific research and innovation
and unleashing their potential to speed up the economic growth. This part of the plan creates
an expectation that by implementing the reforms and investments, Bulgaria’s economic
development will be encouraged in the long term, while boosting competitiveness and hence
economic resilience.


4. Lessons from the previous crisis

    On 20 July 2020, the Council recommended that in 2020 and 2021 Bulgaria should take
all necessary measures to address the pandemic effectively, sustain the economy and support
the ensuing recovery. In its In-depth Reviews carried out since the Covid-19 pandemic the
Commission recommended that, when economic conditions allow, Bulgaria pursue fiscal
policies to achieve prudent medium-term fiscal positions and ensure debt resilience.
    According to Eurostat data (2021) Bulgaria’s total government budget deficit grew from
4.0 per cent of GDP in 2020 to 4.1 per cent in 2021. The measures undertaken by Bulgaria
in 2021 were in line with the Council Recommendation of 20 July 2020. The discretionary
budgetary measures the government adopted in 2020 and 2021 were mostly temporary or
matched by offsetting measures.8 Based on the Commission’s spring 2022 forecast, the
medium-term (10-year average) potential output growth is estimated at 1.8 per cent.
    However, this estimate does not include the impact of the reforms that are part of the
RRP and can boost Bulgaria’s potential growth.
    In 2022, the government phased out the majority of measures taken in response to the
Covid-19 crisis, such that temporary emergency support measures are projected to decline
from 4.3 per cent of GDP in 2021 to 1.8 per cent in 2022. The government deficit is impacted
by the measures adopted to counter the economic and social impact of the increase in energy
prices, which in the Commission’s spring 2022 forecast are estimated at 0.9 per cent of GDP
in 2022 and zero in 2023. These measures consist mainly of support programmes for public

8 The macroeconomic scenario underpinning the budgetary projections in the 2022 Convergence Programme
is favourable in 2022 and realistic thereafter. The government projects that real GDP will grow by 2.6 per cent
in 2022 and 2.8 per cent in 2023. By comparison, the Commission’s 2022 spring forecast projects a lower real
GDP growth of 2.1 per cent in 2022 and higher real GDP growth of 3.1 per cent in 2023, mainly due to
different employment and investment growth projections. In its 2022 Convergence Programme, the
government expects that the headline deficit will increase to 5.3 per cent of GDP in 2022, falling to 2.9 per
cent in 2023. The deficit increases in 2022, which is cushioned by the phase-out of COVID emergency
measures, mainly reflects a steep rise in intermediate consumption, business support and energy measures, as
well as pension system amendments. According to the Programme, the general government debt-to-GDP ratio
is expected to increase to 25.5 per cent in 2022 and to 27.7 per cent in 2023. Based on policy measures known
at the cut-off date of the forecast, the Commission 2022 spring forecast projects government deficits for 2022
and 2023 of 3.7 per cent and 2.4 per cent of GDP, respectively.

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 Krassimira Sredkova                                                    Italian Labour Law e-Journal
 Albena Velikova-Stoyanova                                             Special Issue 1, Vol. 15 (2022)
                                                         The NextGeneration EU in Action: Impact on
                                                                           Social and Labour Policies




utilities and household gas consumers. These measures have been announced as mostly
temporary. If energy prices remain high in 2023, however, some of these measures could be
continued.
    On 18 June 2021, the Council recommended that in 2022 Bulgaria pursue a supportive
fiscal stance, based on the impulse provided by the Recovery and Resilience Facility, and
preserving nationally financed investment. The Council also recommended that Bulgaria
keep the growth of nationally financed current expenditure under control. It also
recommended pursuit, when economic conditions allow, of a fiscal policy aimed at achieving
prudent medium-term fiscal positions and ensuring fiscal sustainability in the medium term,
and at the same time, to enhance investment to boost growth potential.
    The RRP includes an extensive set of mutually reinforcing reforms and investments to be
implemented by 2026. This help to address all or a significant subset of the economic and
social challenges outlined in the Country Specific Recommendations addressed to Bulgaria
by the Council in the European Semester in 2019 and 2020; in addition to any Country
Specific Recommendations issued up to the date of adoption of a plan. In particular, the
RRP addresses the CSRs in the social field with measures to improve social inclusion. These
are expected to improve the adequacy and coverage of the minimum income scheme, and to
move forward with the integration of employment and social services. In addition, the plan
contains far-reaching measures to improve the efficiency of the public administration and
justice system, prevent, detect and correct corruption, improve the business environment,
foster investment, and improve the research and innovation system. This will also help to
support Bulgaria in achieving its remaining commitments under Cooperation and
Verification.
    The 2022 Country Specific Recommendations related to social and employment
protection are aimed at ensuring that growth in nationally funded current expenditure be
consistent with an overall neutral policy stance, given continued support for households and
businesses most vulnerable to energy price spikes and people fleeing Ukraine. The
expectation is to expand public investments for the green and digital transitions and for
energy security, including through the use of EU funds. Further efforts are encouraged to
make full use of public employment services and to provide integrated employment and
social support to mitigate the impact of projected demographic change and support a just
green and digital transition. It is also required to ensure the systematic participation of the
social partners in the implementation of the RRP, as well as in other economic and
employment policies beyond the plan.
    The Ministry of Labour and Social Policy will invest a total of BGN 1,224.8 billion, which
represents 10 per cent of the value of the entire plan for Bulgaria. This Ministry is the first
institution ready to launch a scheme under the Plan. Investments are also aimed at opening
new services, hiring and training staff and providing methodological support (opening of 125
social and integrated health/social services for residential care and 125 social services for
raising awareness and counselling, advocacy and mediation, therapy and rehabilitation and
training for acquiring new skills that can provide quality care for 7,500 people with
disabilities.

https://doi.org/10.6092/issn.1561-8048/15701                                                        10
    Krassimira Sredkova                                                              Italian Labour Law e-Journal
    Albena Velikova-Stoyanova                                                       Special Issue 1, Vol. 15 (2022)
                                                                      The NextGeneration EU in Action: Impact on
                                                                                        Social and Labour Policies




   In the period July 2020–August 2022, five governments (two regular and three caretaker)
worked on drafting six versions of the RRP, related to the adoption of the
NextGenerationEU plan. The draft plans were subject to wide and active consultations. The
planning of reforms and measures under the RRP was repeatedly altered in view of the
amendments to the priorities of the political majorities formed in the several parliamentary
elections held.
   The social partners in Bulgaria have been involved from the very beginning in the
elaboration and implementation of the RRP. They were involved in drafting the Plan through
well-organised institutional networks and actively participated in the consultation stages.9
   The government continuously expanded the opportunities for their participation by
conducting public consultations aimed at achieving a wider range of participants. This was
managed by establishing a special government electronic platform, through which all
interested parties (political parties, non-governmental organisations, including social
partners) could express their opinions and make proposals. More than 30 opinions on the
plan have been expressed on the platform.
   In Bulgaria, the possibility of introducing stricter measures has been categorically rejected.


5. Final considerations.

   The National RRP for Bulgaria reflects national priorities and commitments under the
National Reform Programme and the specific recommendations for Bulgaria within the
framework of the European Semester and the parameters of the Social Scoreboard. In the
three priority areas – employment, education and social protection – additional efforts must
be made at the national level because for a third year in a row the country has been plagued
by unfavourable political, social and economic processes. They create an adverse business
environment, a shortage of qualified workers, social stratification and inequalities.
   The inequalities that emerged because of the pandemic will continue to deepen if the
promotion of a sustainable and competitive economy based on quality jobs and equal
opportunities is not ensured; in other words if social progress does not go hand in hand with
sustained economic growth. Social protection is gradually rising as a priority to a level equal
to economic and fiscal policy through the planned modernisation and expansion, with a view
to mastering the challenges facing the future of work. The expectation is that through
adequate legislative measures protection will be provided to all workers regardless of the
forms, connections and relationships of their labour. Most importantly, a national minimum
income scheme will guarantee protection to all Bulgarian citizens.
   Because of the lack of research on the planned reforms and investments, economic or
legal analyses are not yet available. The RRP foresees a set of measures that are expected to
have a positive and integrated impact on combating poverty and social exclusion, reinforcing

9 For details about social dialogue see Rodriguez Contreras R., Sanz de Miguel P., Involvement of social partners in
the national recovery and resilience plans, Eurofound, Publications Office of the European Union, Luxembourg,
2022, http://eurofound.link/ef21002.

https://doi.org/10.6092/issn.1561-8048/15701                                                                     11
 Krassimira Sredkova                                                  Italian Labour Law e-Journal
 Albena Velikova-Stoyanova                                           Special Issue 1, Vol. 15 (2022)
                                                       The NextGeneration EU in Action: Impact on
                                                                         Social and Labour Policies




the effects of employment, training and qualification measures. In the green and digital
transition, constant investment will be needed in education and training, as well as in
employability and social participation. The goal of providing children, young people and
adults with access to modern education and training via the modernisation of schools and
vocational training centres will require adequate implementation of projects within the
framework of the planned investments. It is expected that by 2024 the differentiated
minimum income will be gradually increased to 30 per cent of the poverty line. The measures
aimed at improving the employment rate, provided for in the RRP, are not sufficient to
ensure the creation of jobs corresponding to the expected changes in the labour market and
continuous demographic deterioration. Measures to cover the unregistered and those not
seeking jobs, especially young people not in employment, education or training (“NEETs”),
are limited.




Copyright © 2022 Krassimira Sredkova, Albena Velikova-Stoyanova. This article is released
under a Creative Commons Attribution 4.0 International License




https://doi.org/10.6092/issn.1561-8048/15701                                                      12
