Банкеръ Weekly

Briefs

National Assembly Reduces Subsidies for Parties

A promise is a promise, especially when given before an election. This maxim was recalled by the deputies in the Bulgarian Parliament before voting the decrease of party subsidies in the state budget for next year. Without particular desire, but pressed by circumstances, lawmakers made a compromise with their original intent and fulfilled commitment both to voters and to the coalition partners. The majority in the National Assembly reduced by 1 levs per vote the public annual support of political formations and closed the chapter party financing with a sense of duty fulfilled.


Nobody likes to have their money reduced, MPs tried to explain the general apathy, but then gave themselves an A for their work. Ataka could not convince the other parties about its proposal state subsidies to be entirely eliminated, but that did not stop the vote in plenary. GERB abstained, but did not oppose the move while the ethnic Turk, Movement for Rights and Freedoms (MRF), which were the only one who did not support the change in the law, managed to use the voted decision as a positive publicity campaign for the entire government. In practice, however, the reduction of the subsidy with the symbolic 8.3% will hardly be felt in big parties and the total amount of money saved will be just a drop among the billions in the state budget ...


What do the calculations say?


Instead of 12 levs per voice won all parties who received at least 1% support in the last polls, will now take 11 levs. This means that next year GERB, for which just over 1 million people voted in the last election will have to say goodbye to 1.08 million levs of its annual subsidy and instead of 13 million levs will take about 11.9 million. In turn, Coalition for Bulgaria shall part with 942,541 levs and next year will be able to count on nearly 10.4 million from the budget. MRF's subsidy will shrink from 4.8 million to 4.4 million levs, and that of Ataka will drop from 3.1 to just over 2.8 million levs. Six extra-parliamentary formations will lose a total of about 481,000 levs .


The bottom line is that the whole move is about the modest sum of 3.15 million levs, which the Treasury will save for the next year. The entire support to parties will swallow nearly 35 million levs in 2014 and by the end of the mandate in 2017 will swell to over 142 million levs. It is therefore difficult to detach from this issue for the party members.


Decision with a Cause


With the money saved we will not fix the state. Given the fact that we are discussing a new reactor for several billion ... But it is an important signal that we send to restore confidence in the National Assembly, said George Kadiev of the leftist Coalition for Bulgaria. The chairman of the parliamentary budget committee and a member of the MRF Yordan Tsonev announced that discussions on the subject are irrelevant because the party subsidy is not a luxury and not a cost for Bulgarian society. If the subsidy is removed, it will reinstate the loops of companies threatened Tsonev and noted that reducing the subsidies by 1 lev can be a small step, but still is a reduction.


Opposing analysts from extra-parliamentary formations said that the cuts in state support will have no positive effect, while the amounts were not decreased by at least a half. However, there were supporters of such a measure in the ranks of MRF and the socialists BSP but they never managed to push through the new texts in the Political Parties Act a few months ago. The motive of the majority was that it is no better the cut to take place before the upcoming vote for the European Parliament, because it can interfere with the election campaign and adversely affect the voting results.


Problems remain


The main problem of existing regulations is that they stimulate political formations to chase one percent of the vote, rather than create lasting policies. It's easy - you collect 50,000 votes and you take 600,000 levs in an annual subsidy and by the end of the mandate you do not have to care what happens in the state, explained the key problem the leftist MP Georgi Kadiev. He even estimated that vote buying in this situation is well worth the investment because at the end of the mandate it turns profitable. Thus small parties can exist unimpeded from election to election without taking absolutely no commitments and getting in return access to power and several million within a single mandate.


In turn, large formations have almost no administrative costs, but in turn have discovered a great way to increase the sums available for them. The financial statements for 2012, the former ruling GERB to the Supreme Auditing Office said that at the beginning of the year the party kept 28.6 million levs in a deposit which brought it a little over half a million levs as annual income. At the same time the reported costs were nearly 15.3 million levs, only 4.5 million levs of which was described as administrative expenditure. The MRF has 8.7 million levs in a bank and a lot more modest interest income, while the socialists has managed to allocate only 2 million levs to a deposit. Both formations, however, managed to fit in the general spending of around 10-12 million levs.


The BANKER

Facebook logo
Бъдете с нас и във