Bulgarians' retirement benefits will increase in 2013 provided the economy exceeded the Cabinet's one per cent minimum growth target for this year, Finance Minister Simeon Dyankov said on April 12.
The Government has earlier announced plans to increase pensions in line with inflation in July. A day earlier, Dyankov said that another indexation would follow in the spring of 2013, although this time it would take into account both inflation and the increase in productivity.
Should the economy grow by more than one per cent in 2012, the Cabinet could afford to increase pensions even further, Dyankov told Bulgarian National Television on April 12.
He said that the announced increase was not a form of electoral promise - Bulgaria's next scheduled parliamentary election is in the summer of 2013.
The funds for the increase would come from increased tax revenue (as a result of stronger-than-expected economic growth) and the sale of state assets, in particular the minority stake in the Bulgarian Energy Holding (BEH), planned for later this year.
Should economic growth fall short of the one per cent mark, funds could be made available through further cuts in state administration, although that was insufficient because cuts were not always the most efficient way of raising funds, he said.
Instead, it was better to sell state assets that were being run inefficiently, such as the BEH stake, which would have the added benefit of increasing transparency in the energy sector, Dyankov said.