Bulgarian Parliament Cancels Budget Debate on Protests

Bulgarian lawmakers postponed today’s debate on revising the budget after protesters blocked parliament and demanded the government’s resignation seven weeks after Premier Plamen Oresharski’s Cabinet took office.

Dozens of rock-throwing demonstrators and several policemen were injured as security forces escorted 120 lawmakers, ministers and journalists out of the Sofia-based assembly at around 4 a.m. following a 10-hour siege, Interior Minister Tsvetlin Yovchev told Bulgarian National Television.

Bulgarian political leaders are struggling to maintain public confidence as voters are increasingly aggressive about their dissatisfaction with what they see as a corrupt political system in the European Union’s poorest member. Oresharski came to power May 29 after anti-austerity protests forced out his predecessor, Boyko Borissov, and led to snap elections. President Rossen Plevneliev said a new vote may be needed.

“The budget revision is needed for our social policy, to pay benefits to the disabled, to the pensioners, to families with schoolchildren,” Socialist leader Sergei Stanishev told reporters in Sofia today. “There are serious issues at stake and they can be resolved only in a dialogue with the government. Protests are not a solution.”

The administration proposed a budget revision to cover increased spending on social benefits, reimbursement of value-added tax receipts and payment for public services to companies. The parliament’s budget and finance committee yesterday approved the package, with debate initially scheduled to start today.

Two Votes

The revision, which needs two rounds of voting for final approval, would widen the deficit to 2 percent of economic output from a previous 1.3 percent and raise the debt sale limit to 1 billion lev ($676 million).

“I’m fed up of being ruled by semi-criminals, who belong in prison and not in parliament,” university student Ivan Stoychev said in an interview with BTV in Sofia today. “We are against this budget revision because it will go into the pockets of various government cronies as usual.”

The latest round of protests began with the June 14 appointment of media executive Delyan Peevski as head of the State Agency for National Security. Nationwide demonstrations forced Peevski, who also has interests in tobacco, banking and telecommunications companies, to back off from the appointment.

The protests have since escalated into daily anti-government marches that turned violent for the first time yesterday.

Street Blockades

Chanting “Mafia out of Parliament” and carrying signs that said, “I won’t pay taxes to the Mafia,” demonstrators erected barricades, blocking the streets around the assembly with paving stones, road signs, trees and trash bins. A white grand piano was brought into parliament square to entertain protesters overnight.

The action left lawmakers trapped in the building for 10 hours yesterday. When authorities brought in a bus at 10 p.m. to help evacuate lawmakers, protesters began throwing stones at the vehicle, setting off clashes with police, who created a cordon around legislators and the bus was forced to return. The lawmakers left the building in a second attempt six hours later in police vehicles.

This morning, bulldozers worked to clear the barricades, while about 50 people looked on peacefully. The piano still stood on the square.

Plevneliev said on July 5 that early elections are the only democratic solution to the standoff between Oresharski’s cabinet and the protesters. Plevneliev has no power to call early elections before the government resigns.

Way Out

“The way out of this situation is for the parliamentary parties to agree on a date for early elections and make a plan on what the government needs to do until then,” Daniel Smilov, an analyst at the Center for Liberal Strategies in Sofia, said by phone today. “We won’t see a consensus among Bulgarians as long as the parties in the assembly don’t agree on a future plan. And they haven’t started talking yet.”

Oresharski, backed by the Socialists and the Movement for Rights and Freedoms, which represents ethnic Turks, has said he won’t resign because doing so would further destabilize the country.

The government parties in the 240-seat assembly are short one lawmaker to support the parliamentary quorum, which is usually granted by the radical nationalist Attack party. The opposition Borissov’s Gerb party is short of the needed majority to pass a no-confidence vote.

Policy Gridlock

The yield on Bulgaria’s euro-denominated bonds maturing in 2017 was 2.272 percent at 3:20 p.m. in Sofia today. The cost of insuring the country’s debt against non-payment for five years using credit-default swaps fell two basis points to 111.8.

“The main risk stemming from the protests is policy gridlock because of a stalled parliament,” Otilia Dhand, an analyst at Teneo Intelligence in London, said in an e-mailed note today. “Last night’s clash is likely to exacerbate the problem as even government MPs are now keen to stay away from the parliament until the protests recede.”

To contact the reporter on this story: Elizabeth Konstantinova in Sofia at ekonstantino@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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