Recovery Plan And Resilience Is Faltering in Bulgaria, And With It, The Reforms

Rembrandt van Rijn: Moneychanger // Public domain

The new government was elected already in June, but it remains to be seen how it will begin to solve the pressing problems caused by the lack of regular governance in the months before. The budget is one such priority, but let’s not forget what happened with the National Recovery and Resilience plan (NRRP).

Let’s recall – the plan was adopted two years ago with a significant delay, which was the reason why Bulgaria failed to receive an advance payment for its implementation. Subsequently, the implementation of the measures and reforms included in the plan started quite clumsily.

While the parliamentary parties and coalitions did not manage to form a majority for a long time and the caretaker government was busy with other pressing activities, which did not include the NRRP, the rest of the countries in Europe were actively working:

  • Spain has received its third payment and almost all other countries have implemented measures and received at least two payments (advance and regular);
  • Eight countries (Estonia, France, Slovakia, Malta, Ireland, Portugal, Denmark, Spain) have submitted requests to adjust their plans in accordance with the new requirements to include a chapter on RePowerEU within the Recovery and Resilience mechanism. In practice, this means an increase in the budget of the plan with additional funds for measures and projects in the field of energy. In Bulgaria, this possibility is not even discussed at this stage.
  • The funds disbursed within the framework of the mechanism have already reached 106.3 billion euros in grants and 47.1 billion euros in loans, which is around 21% of the total funds.

However, Bulgaria is once again late with the implementation of the measures under the NRRP, and hence with receiving payments. For the second installment, which deadline already expired at the end of December 2022, 33 out of 66 measures have not yet been implemented. For the third installment, which expired at the end of June, 43 out of 46 measures remain to be realized. The inconsistency regarding the implementation is also supported by the complete confusion created by the legislative power.

In January 2023, by the decision of the National Assembly the government was obliged to renegotiate Bulgaria’s NRRP in the “Energy” part. At the beginning of June, the parliament obliged the government to report within a 15-day period the steps taken in the renegotiation. However, whether the regular government will keep the commitments of the caretaker one to report to the parliament how far the negotiations with the Commission have come we have yet to find out.

Finally, we will also note the general trend in the EU towards deepening the importance of the Recovery and Resilience mechanism through its gradual inclusion in other forms of governance. An example of this is the new requirements for fiscal governance and the integration of NRRPs in national fiscal forecasts. Is Bulgaria ready to include the reforms and projects provided in the NRRP in its medium-term budget forecast, not just on paper but as an integral part of its governance, securing the upcoming future development of the country? Or will the hesitation and discrepancy between the publicly announced priorities and the practical implementation of the commitments continue?

Written by Petya Georgieva

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