The question of whether there is money in the state coffers – and what the real budget deficit is – has triggered a war of words between Prime Minister Rumen Radev and opposition leader Asen Vassilev of Continue the Change. The two politicians were in Shumen on 15 June to attend the opening of new production facilities at Alcomet.
Prime Minister Radev told journalists that the situation was extremely difficult, that there was no money in the state coffers and that all accounting tricks had already been exhausted by previous governments and could no longer be used.
“We can no longer strip state-owned companies of their capital, because after several successive recapitalisations they are now in poor financial condition and there is nothing more the state can take from them,” Radev said. He added that some state-owned companies were even taking out loans in order to pay dividends and finance their capital repairs.
The prime minister stressed that the main objective was to gradually reduce the budget deficit and limit the need to take on new government debt. At the same time, he said, the actual state of public finances and the imbalances accumulated in recent years had to be taken into account.
“All options are being considered so that the deficit can be reduced and we can borrow as little as possible. All experts and economists say that going from such a high deficit as the one we inherited straight down to a 3% deficit simply cannot happen,” Radev said.
He added that the government was working intensively on structuring the 2026 state budget, focusing on two main areas – increasing revenue collection through a package of specific measures and limiting expenditure.
“The coffers are not empty”
Continue the Change leader Asen Vassilev later rejected the claim that the state coffers were empty. At a news conference, he cited a government press release from 25 May saying that the new administration had inherited €6.8 billion in the state coffers.
“This is not an empty treasury,” Vassilev said, pointing out that when he became finance minister he had received less money from Rumen Radev’s caretaker governments.
“Regarding Mr Radev’s remarks about the deficit, I would remind him that we heard exactly the same claims in 2023 from the same people – Galab Donev was prime minister at the time, and Rositsa Velkova was finance minister. Now Donev is finance minister and Velkova is his deputy. They left us with a budget showing a 6.6% deficit and said there was no way we could bring it down to 3%. We sat down, made proper forecasts, implemented the entire package for better tax collection and bringing revenues into the light, and suddenly the treasury filled up without raising taxes. We produced a budget with a 3% deficit and ended the year even better, with a 2% deficit,” Vassilev said.
“So as for Mr Radev’s claims, I don’t know which experts he consults, but if he consults Galab Donev and Rositsa Velkova, they would have burdened us with a 6.6% deficit back in 2023,” he added.
Vassilev also recalled that, as finance minister in Kiril Petkov’s government, he and his team had prepared the state budget in 45 days, while under Nikolay Denkov’s government it had taken 30 days.
“We did not make excuses or complain,” Vassilev said, criticising the lack of a draft budget.
“Under one-party rule, without coalition partners imposing their own demands, that one party – Progressive Bulgaria – has now been unable to set its priorities and write the budget for a second month. That shows either the wrong priorities or a lack of competence,” he said.
“But what is certainly untenable are excuses such as ‘the treasury is empty’ when you inherited €6.8 billion,” Vassilev added.
“The figures can be checked”
Responding to Boyko Borissov’s accusations that he had spent BGN 500 million a day while serving as finance minister, Vassilev invoked the Bulgarian saying that “a lie has short legs”.
“The good thing about numbers is that they can be checked,” he said.
Vassilev recalled that during his time as finance minister, the ratio of government debt to gross domestic product had fallen by one percentage point, from 24% to 23%.
“The total debt raised during that period was BGN 16 billion over the four years, while GDP grew by almost BGN 70 billion. That means that for every lev of debt, there were almost four leva of GDP growth. This shows that the debt was not simply consumed; it was invested,” he said.
“In 2025, the Rosen Zhelyazkov government, led by GERB, borrowed twice as much as was needed to cover the deficit. The debt-to-GDP ratio rose to 29.9%. And what is more, for every lev of debt raised, GDP increased by only 90 stotinki, rather than four leva. So Mr Borissov should take a look at his own government,” Vassilev said.
“There is money if we plug the leaks”
Because Prime Minister Rumen Radev did not specify the measures the government planned to take to increase revenue collection and reduce spending, saying these would be presented with the draft budget, Vassilev was asked where, in his view, cuts should be made.
He said expenditure cuts were ultimately a matter of the government’s political priorities. Instead of cutting pensions or maternity benefits, or raising taxes, however, he argued that the government should simply “plug the leaks in the state barrel”.
“Once those leaks are plugged, it will suddenly turn out that there is money – and enough of it – and we could find ourselves with a deficit of below 3%,” Vassilev said.
He said the first area that should be addressed was the cost of maintaining the state administration.
“The reports show that as of the first quarter of 2026, spending on maintenance is up 20%. Maintaining the state apparatus – water, coffee, new cars – is costing us 20% more this year than last year,” Vassilev said.
As a second measure, he pointed to systems where personnel costs are dramatically higher than European levels.
“We should start with these systems because they are overfunded compared with the others. These are the Interior Ministry, the State Agency for National Security, the Technical Operations Agency, the prosecution service and the courts – in all these systems our spending is almost twice the European level. Whereas in healthcare we rank 21st,” he said.
Another short-term measure, Vassilev argued, would be to examine all the state “cash boxes” – spending not directly related to the needs of Bulgarian citizens.
“These are usually expenditures channelled into state-owned companies, such as the Bulgarian Development Bank, the State Consolidation Company and others. We need to look at these project by project and see what they are actually about,” he said.
The same applies to major capital expenditure, Vassilev argued, saying the budget should include only projects that can realistically be completed during the year.
“Because what happens there is that huge amounts are declared and then paid out as advances,” he said.
Vassilev cited projects he had reviewed as finance minister as early as 2021.
“Back in 2021, we referred some of these contracts to the prosecution service. These were amendments signed in violation of public procurement law worth around BGN 2.5 billion. They were contracts of the type: a BGN 10 million original contract followed by a BGN 100 million amendment. We referred all of them to the prosecutor general at the time, Ivan Geshev, and then received a letter saying that yes, there had been violations of public procurement law, but the prosecution would not hold anyone responsible because there was no intent or specific purpose. Someone had signed a BGN 100 million amendment without intent or a specific purpose,” Vassilev said sarcastically.
He also cited other areas where money could be saved.
“Let’s finally make hospitals hold tenders for medicines. There’s another €100 million right there, as of 2023. That alone could cover the salaries of young doctors. Let’s review the salaries of hospital directors at loss-making hospitals. Let’s make sure nobody receives a higher salary than their minister.
“And last but not least, let’s reconsider the BOTAS agreement – that’s another €500,000 a day,” Vassilev said.
“These are short-term measures for plugging the leaks in the state barrel. Once those leaks are plugged, it will suddenly become clear that there is money,” he concluded.
