"Bulgaria is the poorest country in the European Union”. This sentence is inevitably part of any publication in the foreign media about Bulgaria. And despite being a cliché, this statement is still true. The reasons that led to the continued impoverishment of Bulgarians as well as the potential way out of the spiral of poverty were examined by the participants in a conference organized by the Institute for Economics and International Relations and the German Friedrich Ebert Foundation. "Poverty must be a leading topic in the public domain," said Deputy Prime Minister and Minister of Labour and Social Affairs Ivaylo Kalfin, who outlined the overall picture of poverty in Bulgaria and presented the government policies to overcome it. Every fifth person in Bulgaria lives in poverty as 40% of the population are at risk to fall into poverty, shows the analysis of the Ministry of Labor and Social Policy. "The reasons for this development are important because they lead to policies to tackle the problem," said Kalfin, adding:

"First, the poor are unemployed. 50.2% of the unemployed live in poverty. There is an absolutely clear link between poverty and employment. Secondly, the group of the poor includes many children. The percentage of underage children living in poverty is extremely high. Thirdly, these are the elderly people over 65 years who live alone, as they are followed by the group of large families with three or more children."

Ivaylo Kalfin stressed another fundamental prerequisite for poverty: the majority of poor people are with low or no education. The share of working poor with low education is 63.5%. These reasons determine the government policies.

"Obviously, the most persistent policy is the access to the labor market," Kalfin continues. "It is particularly difficult for some groups - young people below the age of 29, unemployed people aged over 50 which account for half of the registered unemployed and which often coincide with the group of permanently unemployed who for over a year have been outside the labor market, and people with disabilities."

The problem with the unemployed in pre-retirement age and with people with disabilities is big, admits Kalfin, as Bulgaria has not yet found a way to be of interest to the business. "All current programs are related mainly with subsidized employment in the public sector, but this is not a permanent and effective solution," said the Minister. Criticism of the policies of the Ministry of Labor and Social Policy was voiced by Lyuben Tomov, director of the Institute for Social and Trade Union Research at the CITUB. In his opinion, almost all concepts of combating poverty rely on a catch-up policy to EU averages, missing another important factor:

"The big problem in Bulgaria is that besides the serious social inequalities, the incomes of people themselves are at absolutely low levels that do not allow reaching the necessary funds for the costs of living and do not allow for the formation of a successful middle class," Tomev claims.

According to the calculations of the Institute for Social and Trade Union Research at the CITUB, the average income per household is about 2/3 of the necessary funds for living costs, equivalent to about 280 euros per month. "Only 20% of households in Bulgaria exceed that amount," Lyuben Tomov argues. In the search for solutions, Prof. Gancho Ganchev from the Institute of Economics and International Relations stressed on the link between economic development and poverty:

"Economic growth is what should lead to a reduction of poverty," says Prof. Ganchev. "It has long been known that when the economy is doing well there is more money for salaries, respectively less unemployment, less poor people and more money in the budget, which in turn allows the state to reduce the level of poverty through social security payments. What is less obvious is that there is an inverse relation, i.e. the economies that are characterized by a low level of social inequality and poverty grow faster."

Though not fatally affected by the economic crisis in Europe, Bulgaria still cannot recover and its economic growth is minimal, which prevents income growth. Prof. Ganchev sees the reason for this in the lessons that Bulgaria did not learn from the crisis:

"Bulgaria is the only country in Eastern Europe which after the crisis has not made a fiscal reform. There is a big difference between whether you live on benefits or will start working, especially at a minimum wage. The worst possible situation is one in which you have taxes on people with low incomes, i.e. in this situation you have no incentive from the perspective of the poor people to start working and Bulgaria is the only country in Eastern Europe, which taxes the persons with the lowest incomes," Prof. Ganchev said.

The complex ruling coalition in Bulgaria does not allow for a change in the tax policy, said Ivaylo Kalfin. According to him, lower taxes also lead to lower incomes. For this reason, the policy of his ministry focuses on other measures.

"What our society needs to do is related to education, access to employment and inclusion of people who are in poverty or at risk of poverty in the labor market," Kalfin believes. "This should not be done only via subsidized employment, but also via efforts in various fields in society. Social benefits should be directed at people who for objective reasons are not able to enter the labor market. These are the people with disabilities, the elderly, long-term unemployed people in pre-retirement age, and young people."

English Rossitsa Petcova