The Council of Ministers adopted the draft state social insurance budget for 2011, Labour and Social Policy Minister Totyu Mladenov told journalists on Wednesday.

Next week, the ministers are also planning to approve a bill to amend the Social Insurance Code.

The contribution towards a pension will be increased by 1.8 percentage points on January 1, 2011. The length of service required to receive a pension will be increased by four months every year, beginning in 2015, so that, for example, it will become 40 years for men doing third-category work, compared with the current 37 years.

The retirement age will be increased by six months every year from January 1, 2017 until it reaches 66 years for men and 63 years for women.

The contribution to the employees' pay guarantee bill, which currently stands at 0.1 per cent, will be zero in the next three years because there is over 200 million leva (over 102 million euro) accumulated in it already.

The average monthly contributory income in 2011 will be 609.86 leva (311.82 euro), 6.3 per cent up from 2010.

Differentiated rates will be introduced for the minimum monthly contributory income of self-insured persons at 420, 450, 500 and 550 leva (214.74, 230.08, 255.65 and 281.21 euro), respectively, according to the declared income. Farmers, including tobacco-growers, will continue to pay for social insurance on a monthly income of 240 leva (122.71 euro).

The unemployment benefit ceiling will be removed. Unemployment benefits will be calculated on the basis of 60 per cent of the contributory income before the job loss. The minimum daily unemployment benefit will be increased to 7.20 leva (3.68 euro) from the current 6 leva (3.07 euro).

Talking to the media before the joint meeting of the national strike committees of his labour organization and the Confederation of Independent Trade Unions in Bulgaria (CITUB), Podkrepa Labour Confederation leader Konstantin Trenchev expressed the view that the establishment of a solidarity fund is the only way of guaranteeing the pensions of first- and second-category workers (doing jobs in harsh working conditions).

At a meeting of the Council of Ministers Wednesday, Labour and Social Policy Minister Totyu Mladenov said a solidarity fund will be set up on January 2011 to which employers will have to make additional contributions for categorized workers. Workers of category One and Two will be paid their temporary pensions from this fund. On Monday Mladenov said that the best thing to do about categorized workers is to extend by a year the grace period for their early pensioning through the National Social Insurance Institute (NSII) .

Replying a question if Mladenov's proposal would make the trade unions give up the plans for strikes, Trenchev said that a meeting to be held Wednesday will discuss tensions in the different economic sectors and the condition of the state, pointing out such discussion is very important. `

"The trade unions do not seek political ends, to us it is important that the state moves on," Trenchev said.

Due to the great public interest, the transcript of the debates on the Council of Ministers decision to approve the drafted state social budget for 2011is posted on the website of the cabinet, the government press office said.

Source: BTA