COMPENDIUM CULTURAL POLICIES AND TRENDS IN EUROPE
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Bulgaria/ 6. Financing of culture  

6.1 Short overview

The analysis of the funding in the cultural sector within the framework of the economic development and the financial status quo of the country for the last twenty years indicates several stages and some constant trends in public expenditure for culture.

The economic situation of the country and the scope and amount of the national budget have a considerable impact on the budget allocated to the cultural sector.

During the last 20 years, three definite stages can be evaluated in accordance with the approximate share of the budget allocated for culture by comparison with GDP (on the basis of the reports for the spending of the consolidated state budgets).

The first stage is from 1990 to 1992 and is characterised by a high level of funding for culture but the trend shows a decline - from 1.09% at the beginning of the period to 0.8-0.9% of GDP at the end.

The second stage (from 1993-1997) is related to the grave crisis in the economy - financial and economic crisis and hyperinflation in the period 1996-1997. During this stage, the active servicing of foreign debt started, as Bulgaria was obliged to do as a result of the 1994 negotiations with the London Club and the signing of the so-called Brady Agreement. The servicing of the interest of the debt by means of the state budget increased tension concerning the distribution of the budget. Culture had to operate on some mere "leftovers" of the budget. In 1996-1997, the budget for culture hit a low of 0.43% of GDP. The 1990s was a time of considerable shrinking of cultural activities, some diminishing severely. Some cultural institutions were closed down, while others struggled to survive - a typical example is the cinema industry.

The third stage is from 1998 - 2008: this period is characterised by slow recovery of the economy and a steady rise, especially from 2000 onwards (more than 6%), of the level of GDP. Its levels reached the stage typical for GDP in the beginning of the transitional period in 1998. At the beginning of this period, the share of culture expenditure as a part of GDP grew considerably - from 0.44% in 1996 up to 0.78% in 1999, an increase of 73 %. However, during later years (from 2000-2008), this share remained stable and amounted to approximately 0.7%. In 2008 the rate was 0.724 %. In seven of the nine years of this period researched, the Bulgarian fiscal balance is positive, i.е. the year ended with a fiscal surplus, which during the last two years exceeded 3% of GDP. Part of this surplus was allocated to the fiscal reserve and some was directed towards the public sector, including culture. Unfortunately, inflation swallowed much of the nominal increase in public spending for culture.

During the last two years (2009-2010), there is has been a relative drop in public expenditure for culture due to the exacerbating economic crisis, the negative growth of GDP, and the drop in overall public expenditure. Public expenditure for culture in 2008 (the year when the highest amount of money was allocated to culture for the last 20 years on) was 460.8 million but this diminished in 2009 to 440.5 million BGN. The estimated budget for 2010 is 358.2 million BGN. The draft budget for 2011 shows an increase from 2010 to 368.1 million BGN. The budget of the Ministry of Culture amounted to 138 million BGN in 2008; 120 million BGN in 2009, аnd 92 million BGN in 2010. In the draft budget proposal for 2011, the amount provided amounts to 94 million BGN, a slight rise from the previous year.

The expenditure of households for cultural goods and services are being calculated by the national statistics under the grouping of "Leisure time, cultural recreation and education" and cannot be separated. In the beginning of 2004, the National Statistical Institute carried out a study of household budgets in 2003. The results which are related to culture are given in the table below:

Table 8:     Household expenditure for leisure time, cultural recreation and education, in BGN, 1999-2009

 

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Average per household

119

124

124

141

162

174

193

210

259

298

318

Average per person

43

45

46

53

62

68

76

84

103

120

129

Structure - % of all expenditures

3.7

3.6

3.5

3.6

3.9

3.8

3.9

3.8

3.8

3.8

4.0

Source:      National Statistical Institute, 2009.

An example of positive change and of "good practice" in cultural policy is the "Culture" Programme set up by Sofia City municipality. The Programme will support projects that will be selected by public tender with clearly stated priorities, criteria and evaluation mechanisms. This is a sign of significant change in the municipal authorities' attitude towards the financing of culture because it opens up the possibility for support not only of traditional cultural institutions (as at present), but also for authors and groups which do not belong to these organisations. The non-government sector in the cultural sphere, which is more flexible and creative, should at last get the chance to develop its potential more adequately. Before the start of the programme, the nongovernmental cultural institutions did not have any source of public funding. Therefore, the cultural sector regards this initiative as a serious investment, despite the modest annual budget of BGN 1 000 000 allocated to the programme for 2005 and 2006.


Chapter published: 20-01-2011

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