Social security revenue is slowing, while pension expenditures are accelerating

Growth in social security revenue in the State Social Security Fund (SSSF) budget slowed in May, while pension expenditures continued to rise. This is shown by data from the National Social Security Institute’s (NSSI) report on the implementation of the social budget.

According to the report, consolidated revenue as of May totaled 3.4 billion euros, representing an increase of 363 million euros (11.9%) compared to the same period in 2025. By comparison, growth in April was 15.4%, and in March it peaked at 16.9%.

On the other hand, total expenditures within the National Social Security Institute (NOI) system exceeded 6 billion euros, representing a 9.6% increase year-over-year. Pensions alone accounted for 5.4 billion euros, a 10.4% increase compared to the previous year. Traditionally, pensions continue to account for the largest share of the NSSI’s expenditures.

We remind you that as of July 1, all pensions were adjusted according to the so-called “Swiss rule,” which in Bulgaria is applied selectively and rarely as it should be. Thus, pensions granted as of that date were increased by 7.8%, including the social old-age pension. People receiving a portion of their deceased spouse’s pension – the so-called “widow’s allowance” – also receive 7.8% more.

At the same time, through amendments to the Social Insurance Budget Act, lawmakers approved that, effective July 1, the amount of all pensions related to employment will no longer include the additional 30.68 euros, or the so-called COVID-19 supplement.

The Ministry of Finance (MF) noted in its monthly bulletin on the implementation of the Consolidated Fiscal Program (CFP) that pension expenditures have contributed to the widening of the overall budget deficit. Preliminary estimates for July indicate that the balance under the Consolidated Fiscal Program (CFP) will be a deficit of 2.2 billion euros, and among the reasons for the observed increase in expenditures are the rise in pensions as well as the increase in the minimum wage effective January 2026.

How Many Pensioners Are There in Bulgaria

Meanwhile, the latest data from the National Social Security Institute (NOI) show that the number of pensioners as of May 2026 was 2,068,870, an increase of 13,009 (0.6%) compared to the same month of the previous year. The average monthly pension per retiree is 519.09 euros. Compared to 2025, this is 42.60 euros (8.9%) higher.

According to NSI data, as of the end of the first quarter, there were 2,916,500 people employed in the Bulgarian economy. This means there are 1.4 workers for every pensioner. The steadily declining ratio means it will become increasingly difficult to cover the National Social Security Institute’s (NOI) shortfall with taxes from the economically active population. This growing imbalance and the lack of reforms have led the International Monetary Fund and even the European Commission to regularly advise the country to raise taxes.

For now, the new government is not concerned about the state of Bulgaria’s pension system. A week ago, Minister of Labor and Social Policy Natalia Efremova stated that she is not worried about the National Social Security Fund’s budget, as transfers from the state budget are proceeding as usual.

Translated with DeepL.