Despite a significant improvement in labour market conditions over the last decade, and an accompanying rise in household living standards, major social challenges persist in Bulgaria (see Chapter 2). Poverty and material deprivation remain widespread, notably among seniors and families with many children. Rapid population ageing and high emigration of working-age Bulgarians have been raising the pressure on social protection systems, which moreover are undermined by widespread informality. And the social and labour market inclusion of ethnic minorities and disadvantaged groups living in rural and remote communities remains very difficult. Against this backdrop, social policies have an essential role to play in fighting poverty and boosting living standards, promoting formal employment among people at the margins of the labour market, raising fertility, and reducing social exclusion.
OECD Reviews of Labour Market and Social Policies: Bulgaria 2025
Public social expenditures in Bulgaria are comparable to those in many OECD countries. In 2019, i.e. before any spending increases related to the COVID‑19 crisis,1 Bulgaria spent about 16.5% of its GDP on cash benefits and social and health services (Figure 5.1). This is below the OECD average of 20.1%, but comparable to the shares spent in the Baltic countries, Hungary and the Slovak Republic (all between 16.5% and 18%) and a little above the spending levels in Switzerland and the Netherlands (16.1% and 16.3%). Compared to these countries, Bulgaria dedicates a relatively large share of its GDP to pensions (7.5%), and relatively little to working-age income support (2.9%).
Low expenditures on working-age income support reflect primarily low spending on social assistance and – to a lesser extent – unemployment benefits. This is illustrated in Figure 5.2, which gives a breakdown of working-age income support in Bulgaria over time comparing it to 2019 spending levels in a selection of OECD countries. In the years before the COVID‑19 crisis, spending on unemployment benefits and social assistance jointly amounted to only around 0.4% of Bulgarian GDP, less than half of the 1% observed across the OECD on average. Spending on incapacity benefits and family-related benefits was much in line with the OECD average, at 1.6% and 1.0%. In 2020, the first year of the COVID‑19 crisis, spending on working-age income support in Bulgaria rose by 0.4% of GDP as a result of higher spending on unemployment benefits (+0.2%) and incapacity benefits (+0.1%) and a 4% drop in GDP that year.
Public social expenditure by broad social policy area as a percentage of GDP, 2019
Note: Countries are ranked by decreasing order of public social expenditure as a percentage of GDP. Spending on active labour market programmes (ALMPs) cannot be split by cash/services breakdown; they are however included in the total public spending (shown in brackets). Income support to the working-age population refers to spending on the following SOCX cash categories: Incapacity benefits, Family cash benefits, Unemployment and other social policy areas categories.
Source: OECD Data Explorer • Social expenditure aggregates. Unpublished data for Bulgaria. For detail on the underlying methodology regarding the detailed social expenditure programme data, see the manual to the OECD Social Expenditure database.
As a result of this benefit structure, the Bulgarian income support system is not very effective at boosting the incomes of the most vulnerable households. According to data from the OECD Income Distribution Database (OECD, 2023[1]), the share of total cash transfers received by working‑age households in the bottom quintile of the income distribution was only about half as high for those in the top quintile. Only in a handful of OECD countries – Costa Rica, Greece, Italy, Spain and Türkiye – do the poorest households receive an even lower share of working-age benefits. Overall, taxes and transfers in Bulgaria reduce the share of people living below the 50% poverty line by less than half, from 30.2% to 16.5% in 2021. For comparison, across OECD countries on average, the poverty-reducing effect of taxes and transfers equals nearly 60%, and it is much higher in many European OECD countries (OECD, 2023[1]).
Cash social spending for the working-age population by social policy branch, percentage of GDP, Bulgaria (2013‑20) and selected OECD countries (2019)
Note: Expenditures in the categories “unemployment” and “Social assistance” are primarily for unemployment benefits and social assistance, respectively. “Incapacity” includes primarily spending on disability pensions and paid sick leave. “Family” includes maternity / paternity and parental-leave benefits, but also other family allowances including child benefits.
Source: OECD Data Explorer • Social expenditure aggregates. Unpublished data for Bulgaria.
The overall redistributive capacity of the Bulgarian tax and benefit system is also low, with taxes and benefits doing comparatively little to reduce high inequality in market incomes. Bulgaria operates a flat‑rate income tax system with a personal tax rate of only 10% and without individual tax‑free allowance. Child tax allowances introduce some degree of progressivity: parents with children below the age of 18 years benefit of a reduction in their annual tax base by BGN 6 000 (about EUR 3 070) for each child, up to the third child, to be used by either of the two parents. Social-security contributions are relatively high, at 33% (13.78% payable by the employee plus 19.22% payable by the employer), weighing heavily on low‑income households who typically do not have major sources of income besides earnings from work.2 At 30.8% of GDP, total tax revenue including social security contributions was below the OECD average of 34.2% in 2021 though comparable to the levels attained in many OECD countries, including, for example, the Baltics (OECD, 2023[2]). As a consequence, income redistribution is relatively weak: taxes and transfers in Bulgaria reduce the Gini Index, as a standard measure of income inequality, by one‑quarter, compared to a reduction by one‑third across the OECD on average. This is in a context where inequalities in market incomes, i.e. incomes before taxes and transfers, are high, with a Gini Index of 51.2 in 2021 (47.3 in the OECD on average). This interplay of large inequalities in market incomes and weak redistribution explains Bulgaria’s high inequality in disposable household incomes (see Figure 2.13 and the discussion in Hallaert (2020[3]) and OECD (2023[4])). Bulgaria could consider reforming its tax and benefit system to increase progressivity and tackle high income inequalities, though care must be taken that such a reform does not raise the incentives to under-declare wages. Indeed, there is a widespread perception in Bulgaria that inequalities are too high. In a recent Eurobarometer survey (European Commission, 2022[5]), 93% of respondents in Bulgaria agreed, or strongly agreed, with the statement that income differences are too large in Bulgaria, the second highest share across EU countries (EU average of 81%); 87% of people felt that the government should take measures to reduce income differences (EU average of 78%).
5.2.1. Unemployment benefits replace a large share of workers’ previous income, but maximum benefit durations are modest and coverage is low
Workers in Bulgaria who lose their job are protected from income losses through a single‑tier, contributory unemployment insurance benefit (Обезщетение за безработица) with a comparatively high payment rate but short maximum benefit durations. Jobseekers with the required contribution history – at least 12 out of the last 18 months – who were employed at the average wage are entitled to around 77% of their previous net income in benefits (Figure 5.3, Panel A).3 This is a very high net replacement rate in OECD comparison: across OECD countries in 2023, unemployment benefits replaced on average just below 60% of jobseekers’ previous net income in the second month including potential top‑ups. Among OECD countries, only Luxembourg, Latvia and Lithuania have higher net replacement rates in the second month of the benefit spell. The replacement rate in Bulgaria remains stable over the benefit spell, unlike in a number of Central and Eastern European OECD countries where it is degressive over time. However, maximum benefit durations are relatively short: jobseekers with a contribution record of up to three years, as well as those who quit their job voluntarily, are entitled to a maximum of four months of benefits; the maximum benefit duration rises to six months for those who contributed for three to seven years, and further increases stepwise to reach 12 months for those previously employed for at least 15 years.
Only about half of all jobseekers in Bulgaria receive unemployment benefits. In 2022, the number of benefit recipients relative to that of those unemployed according to the ILO definition, the so‑called “pseudo-coverage rate”, equalled about 47% (Figure 5.3, Panel B). This places Bulgaria in a lower‑midfield position relative to OECD countries (Langenbucher and Ormsby, 2022[6]; OECD, 2023[4]). Pseudo‑coverage rates are generally highest in countries that – in addition to first-tier unemployment insurance programmes – operate second‑tier unemployment assistance programmes, including a number of western and northern European countries, Australia, New Zealand and the United Kingdom. Activity-related eligibility criteria for unemployment benefit receipt are in line with those of many OECD countries, with an overall strictness score that would rank Bulgaria in the lower third among OECD countries (Immervoll et al., 2022[7]; 2023[4]). Jobseekers who take up part‑time work with earnings below the national minimum wage can continue receiving 50% of their unemployment benefit payments in form of a transitional in-work benefit until their unemployment benefits entitlements expire.
Relatively short maximum unemployment benefit durations, and the resulting low benefit coverage, cause challenges for the income insecurity of some jobless households, but Bulgaria has taken first steps towards addressing this issue. Until mid‑2023, Bulgaria’s main minimum‑income benefit, the means-tested social assistance, came with a waiting period of six months for employable claimants, see discussion below. Unemployment benefit recipients with only four months of entitlements who did not find work during this period therefore faced a two‑month gap in income support before they qualified for social assistance. This concerned jobseekers with a contribution history of less than three years, workers who quit their job voluntarily, and those dismissed for misconduct. About one‑in-three unemployment benefit recipients in 2020 had less than six months of benefit entitlements, but nearly half of all jobseekers from the Turkish minority and close to two‑in-three young and Roma jobseekers (Langenbucher and Ormsby, 2022[6]). Bulgaria closed this gap by shortening the waiting period for social assistance receipt to three months, and there are plans to raise the maximum duration of unemployment benefits to at least six months for all recipient groups in line with OECD recommendations (OECD, 2023[4]). A timeline for this latter change had not yet been communicated at the time of writing.
Note: Net replacement rates give the share of previous net income replaced by unemployment benefits and top-ups for a single person with previous earnings at the average wage in the second and seventh month of registered unemployment. Calculations are for a 40‑year‑old single person without children who has been continuously employed since the age of 18 in full-time employment. Previous earnings are at the median of the national full-time earnings distribution. Data refer to 2022 for Australia, Belgium, Canada, Denmark, Israel, Japan, Portugal and the United States. The pseudo-coverage rate gives the number of unemployed entitled to benefit as a percentage of unemployed (Panel B).
Source: OECD Tax-Benefit model version 2.6.0 (Panel A), OECD Data Explorer • Employment and unemployment by five‑year age group and sex - indicators for the number of unemployed and the Bulgarian National Social Security Institute for unemployed entitled to benefits (Panel B).
5.2.2. Bulgaria significantly improved the adequacy and accessibility of minimum‑income support, but further steps will be needed to effectively reduce poverty
Low-income households in Bulgaria who struggle to make ends meet from own resources may be entitled to different types of minimum-income support. Non‑contributory social assistance (Социална помощ) cash benefits are payable one‑off or on a monthly basis, in principle for an unlimited duration. To qualify, households need to have an income below a certain threshold and no immovable property, capital or other assets that could be used to generate income. A means-tested targeted heating allowance (Целева помощ за отопление), which comes with a higher income threshold and is therefore available to a much higher number of lower‑income households, is paid once per year.
However, the adequacy of minimum-income support in Bulgaria remains low in spite of a significant recent increase in social assistance payment rates. Up until mid‑2023, social assistance benefit payments were calculated through a complex formula that augmented an index number (referred to as the Guaranteed Minimum Income, GMI) by a personal adjustment factor that varied with the claimant’s age, work capacity and living arrangements. For a single childless adult, the combined payments from social assistance and the heating allowance equalled 11% of the median equivalised disposable household income, a rate lower than in any OECD country except for Hungary and the United States (Figure 5.4, Panel A; “Bulgaria (Jan)”). For a workless couple with two small children, benefit payments reached 17% of the median equivalised disposable household. Through a reform of its Social Assistance Act, which entered into force in June 2023, Bulgaria explicitly tied the level of social assistance and the income threshold for eligibility to the targeted heating allowance to the Eurostat poverty line and simplified the calculation of benefit entitlements. According to preliminary calculations, the new rules more than double benefit payments for single recipients to about 24% of the median equivalised disposable household income from mid‑2023. For a couple with two young children, benefit payments increase by about two‑thirds to around 28% of the median equivalised disposable household income (Figure 5.4, Panel A, “Bulgaria (June)”). However, even after this first notable increase in social assistance benefits in the last decade (Figure 5.4, Panel B), benefit rates remain substantially below the OECD average (36% of the median income for a single recipient) and the poverty threshold.
While, under the new rules, social assistance benefits now automatically follow any rise in the median income (via the relative poverty threshold), a shortcoming of the new formula is that this only happens with a time lag of several years.4 The reason is that benefit levels are tied to the latest published Eurostat poverty line, which usually reflects income distribution data from three year prior. In periods of rapid income growth or high inflation, as in the last few years, the reference poverty line used for determining benefit levels is therefore much lower than it would be if it were calculated on real‑time income data. Indeed, the rapid rise in prices experienced in 2022 and 2023, when annual inflation rates in Bulgaria averaged 15.3% and 9.3% (National Statistical Institute, 2024[8]), will translate into a substantial increase in benefit levels only in 2025 and 2026. This explains why, in Figure 5.4, benefit levels did not increase by even more in mid‑2023 when expressed relative to 2023 incomes. To address this issue, and avoid the intertemporal inequities that arise from it, it may be worth considering adjusting the Eurostat poverty line at least for inflation before using it as a reference for calculating benefit entitlements.
Net income from minimum-income benefits as a percentage of the median equivalised household income, Bulgaria and selected OECD countries
Note: The dashed horizonal line in both panels indicates the relative poverty line of 50% of the equivalised median household income. Results for Bulgaria for June 2023 are preliminary. Data for the United States refer to 2022.
Panel A: Results are for a single adult without children and a jobless couple with two children aged 4 and 6. The family is assumed to meet the requirements for social assistance and cash housing supplements. Family benefits are included in the calculations subject to relevant income and eligibility conditions. Panel B: Results are for a single adult without children.
Source: OECD Data Explorer • Adequacy of minimum income benefits (Panel A) and OECD calculations based on the OECD Tax-Benefit model version 2.6.0 and unpublished data for median disposable household income (Panel B).
The 2023 reform of the Social Assistance Act also somewhat loosened the previously very strict eligibility criteria for social assistance, though benefit accessibility likely remains low. For a low‑income household to be able to claim social assistance benefits, all employable household members need to have been registered with the EA for three months (before June 2023: six months). No OECD country included in the OECD Tax-Benefit Model applies a similar waiting period (OECD, 2022[9]). Benefit recipients must engage in compulsory community service, such as sweeping streets or looking after graveyards, for 40 hours per month (previously: 56 hours), unless if they are exempt or participate in an active labour market programme. Previously harsh benefit sanctions applied in case of misconduct were eased, but sanctions remain heavy: recipients who repeatedly refuse to perform community service have their payments suspended for six months (previously: two years); a six‑month suspension applies also for recipients who refuse to participate in an employment programme (previously: one year); wrongful receipt of benefits leads to a suspension for up to one year (previously: two years), until the wrongfully received benefits have been paid back. Other important changes brought about by the reform include benefit reductions for families whose children fail to regularly attend school or who miss mandatory medical examinations and vaccinations was scrapped; a loosening of the asset test; and a new rule permitting benefit recipients who take up work to keep receiving their benefits for three months as an in‑work benefit.
Low payment levels and tight eligibility criteria for social assistance primarily reflect policy makers’ concerns about low-income households’ lack of incentives to seek formal employment. During the OECD policy mission, representatives from different public authorities referred to a widespread culture of “idleness” among low‑income people, who – according to their perception – in many cases prefer to live on benefits, possibly topped up by some income from informal work, to taking up formal employment. And while the level of social assistance is low relative to the minimum wage (Figure 5.4, Panel B), the cumulative payments from social assistance and the monthly child allowance can indeed surpass the potential earnings from low-paid work for families with many children, of whom there are many among ethnic minorities. At the same time, however, the low payment levels, combined with a substantial community work requirement, likely contribute to substantial rates benefit non‑take‑up among those eligible.5
While it is too early for a precise assessment of the impacts of the social assistance reform, further steps will likely be needed to improve adequacy, accessibility and the benefit system’s effectiveness at tackling poverty and promoting labour market and social inclusion. Preliminary data provided by the Ministry of Labour and Social Policy show a minor uptick in the average number of social assistance benefit recipients for 2023 relative to 2022, reversing a previous trend of declining recipient numbers. The average monthly number of benefit-receiving households remains low, however, at around 20 000. Earlier estimates suggested a rise in the number of benefit recipients to 100 000 (BTA, 2022[10]), which however may just take some time to materialise. A more immediate effect of the reform has already been a near doubling in the total funds dispersed from 2022 to 2023, from around BGN 25 million (EUR 12.8 million) to over BGN 45 million (EUR 23 million) – a remarkable increase given that the reform was only implemented in June.
Bulgaria could raise the accessibility of benefits, improve living conditions among the most vulnerable households and better promote their labour market integration by further shortening the waiting period, easing community work requirements, and ensuring instead a more systematic activation of benefit recipients through the EA. This could also help tackle the challenges of high inactivity – particularly among young people – and informality by better connecting low‑income people to the EA for employment support and training. As part of its 2023 targets under the European Pillar of Social Rights, Bulgaria has committed to reduce the number of people at risk of poverty and social exclusion by 787 000, 25% of which should come from a reduction in the number of children at risk of poverty and social exclusion.
5.2.3. A reform of social services is underway
The reform of social services has been one of the policy priorities in Bulgaria in recent years. The provision of social services, including long-term care, is decentralised in Bulgaria, with the municipalities responsible for providing services financed through the municipal or state budget (European Commission, 2021[11]). Given Bulgaria’s territorial inequalities, this leads to large geographic disparities and a lack of transparency on the availability and quality of services offered. Through a new Social Services Act, which entered into force in July 2020, Bulgaria regulated the planning, financing, supervision and monitoring of social services with a view to improving the quality and efficiency of service provision. Bulgaria is currently in the process of adopting the by-laws to this Act and revising the Ordinance on the Quality of Social Services.
Based on the Social Services Act, Bulgaria is also preparing, for the first time, a complete overview of the network of all social services financed through the state budget. This National Social Services Map will provide information on all social and integrated social and health services available in the country and on their user capacity. It is meant to serve as the basis for a countrywide needs assessment and the planning of social service provision over the next decade in a dialogue between the ministry, municipalities, and other stakeholders. The National Social Services Map is about to be adopted by the Council of Ministers. It will be followed up on with new financing standards for state‑delegated social services and workload standards for service providers.
5.3.1. Gender inequalities in education and the labour market are comparatively small in Bulgaria, but traditional gender roles prevail
Gender inequalities in education and labour market outcomes are relatively small in Bulgaria. Women and girls do well in the educational system, with comparable performance levels for girls and boys in the 2022 PISA Survey (OECD, 2023[12]) and tertiary graduation rates of women substantially above those of men, as in other European countries (Eurostat, 2023[13]). While women in Bulgaria lag men in both employment rates and earnings, these gender gaps are narrower than in many OECD countries (see Figure 2.4 and Figure 2.6). The share of women in senior and middle management positions is also higher than in most OECD countries (OECD, 2023[4]), though women in Bulgaria are heavily underrepresented on the boards of the largest listed companies in the country (15% women in 2022, compared to an EU average of 32%; European Commission (2023[14])). The gender pension gap remains substantial in Bulgaria, averaging about 23% over the last five years, but it is 5 percentage points narrower than across EU countries on average (Eurostat, 2024[15]). The European Institute for Gender Equality ranks Bulgaria in a lower midfield position among EU countries in their index of gender equality, but observes a slow convergence towards the EU average, with scores having risen along all dimensions since 2010 (EIGE, 2024[16]).6
Women’s representation in political decision-making positions is one area where substantial work remains to be done. Only about one‑in-four (24.8%) Bulgarian Parliamentarians were women in the fourth quarter of 2023, a rate substantially below the EU average of 33.1% and very far from parity (EIGE, 2023[17]). Among senior ministers in national government, the share is lower still at one‑in-five (EU average of one‑in‑three). Meanwhile, in a 2017 Eurobarometer survey on gender equality – unfortunately the most recent one on this topic – only 38% of respondents felt that there should be more women in political decision-making positions in Bulgaria, one of the lowest shares across EU countries (European Commission, 2017[18]). Those numbers are indicative of prevailing traditional gender roles more broadly. In the same survey, Bulgaria came out as the country with the highest gender stereotype index, scoring highest of all EU countries in three out of four of the underlying questions.7 Bulgaria also ranks sixth from the bottom among EU countries in an index measuring public perceptions of whether men should contribute to promoting gender equality.
Bulgaria has a National Strategy for Promoting the Equality of Women and Men for the period 2021‑30, which is currently being implemented through a National Action Plan for the years 2023‑24. The five priority areas of this Action Plan are: i) promoting the equality of women and men in the labour market and an equal degree of independence; ii) reducing the gender pay and income gap; iii) promoting equality of women and men in decision-making processes; iv) combating violence and protecting and supporting victims; and iv) overcoming gender stereotypes and sexism in various spheres of public life. An annual report on the equality between women and men, which is adopted by the Council of Ministers, gives an overview of the results of the Action Plan and other policy initiatives.
5.3.2. There is substantial scope to reduce the care burden on women
In the context of its declining population and shrinking workforce, Bulgaria could do much more to reduce the care burden on women to support women who have children and further promote female labour force participation. Indeed, caregivers account for a high share of Bulgaria’s large inactive population (OECD, 2023[4]), even if available estimates suggest that the gender gap in unpaid work may be a little lower than in the EU average (Eurofound, 2022[19]).8
Raising participation rates in early childhood education and care (ECEC) is one priority area. According to the OECD Family Database, 78% of 3‑5 year‑olds in Bulgaria were enrolled in early childhood education and care services in 2020, 3 percentage points less than had been in 2013, and much below the average rate across the OECD of 87% (Figure 5.5). Among children under 3, the participation rate was only 15%, less than half the OECD average of 36%. Anecdotal evidence suggests that participation rates are particularly low for minority groups, notably Roma students. Barriers to enrolment include insufficient capacity, especially in urban areas, and lack of transportation in rural areas (Guthrie et al., 2022[20]; OECD, 2023[21]). Bulgaria abolished the fees for public nurseries and kindergartens for all children in April 2022 to raise participation in ECEC, particularly for children from disadvantaged households. Investment in kindergartens is being stepped up under the Bulgaria’s NRRP, and 4‑year‑olds will be included in pre‑school education (OECD, 2023[4]).
Share of children enrolled in early childhood education and care services or primary education by age, 2020
Note: Early childhood education and care services (ISCED level 0 and other registered services) or primary education (ISCED 2011 Level 1). Data refer to 2018 (Costa Rica, Iceland, the United Kingdom) and 2019 (Japan).
Source: OECD Family Database, Indicator PF3.2 Enrolment in childcare and pre‑school.
Promoting a more active participation of fathers in providing childcare is a government priority in Bulgaria, but more could be done to encourage a more equal sharing of caring responsibilities. Bulgaria has very generous paid leave for mothers: women with a previous contribution history of at least 12 months qualify for a full year of maternity leave, plus 45 days before childbirth, compensated at 90% of previous gross earnings (and at least the minimum wage). This is followed by a second year of parental leave, which is compensated flat-rate at an amount that is revised annually (BGN 780, about EUR 400, per month in 2024). Mothers who return to work during the first two years after childbirth are allowed to keep 50% of their paid leave entitlements. These paid leave entitlements for mothers are substantially more generous than in most OECD countries (OECD, 2022[22]).
Paid leave entitlements for fathers were recently extended but remain comparatively low. Fathers are entitled to an optional 15 days of paternity leave after childbirth compensated at 90% of previous gross earnings. In August 2022, Bulgaria additionally introduced two months of paid parental leave for fathers, to be taken at any time before the child’s eighth birthday, compensated flat rate at a monthly BGN 780 (EUR 400). Parents can also decide to transfer part of the mothers’ paid leave entitlements to the father once a child has reached the age of six months but remains younger than two years. In practice, however, this this opportunity is very rarely made use of. As highlighted in the last OECD Economic Survey of Bulgaria (OECD, 2023[4]), extending the earnings-related paternity leave, or making some of it compulsory, could make it more attractive for fathers to make use of their leave and encourage a more equal sharing of childcare responsibilities between parents.
Achieving a more equal sharing of family and work responsibilities will also likely require changing public perceptions of gender roles in society. In the above‑cited 2017 Eurobarometer survey on gender equality (European Commission, 2017[18]), 81% of respondents in Bulgaria agreed with the statement that the most important role of a woman is to take care of her home and family; meanwhile, the same share, 81%, agreed that the most important role of a man is to earn money. Both values were the highest among all European countries (EU averages of 44% and 43%, respectively; European Commission (2017[18])).
The situation of members of the LGBTQI community in Bulgaria is marked by conservative societal attitudes, discrimination and the need for more action in favour of LGBTQI rights. LGBTQI individuals still face substantial discrimination both in the workplace and in social life, and political players have been exploiting ressentiment against sexual minorities for political purposes.
Surveys point to very low levels of societal acceptance of LGBTQI individuals. Only about one‑in-four (27%) Bulgarians, less than in any other EU country, would feel comfortable having a gay, lesbian or bisexual colleague according to a special Eurobarometer survey, against 72% on average in the EU (see Figure 2.15). Acceptance rates of transgender co-workers are even lower (24% in Bulgaria comparing to 65% in the EU) (European Commission, 2019[23]). Similarly, indicators of acceptance towards LGBTQI individuals in social life (e.g. for showing affection in public), personal rights (e.g. right to change civil documents according to inner gender identity) and politics (e.g. having an LGBTQI person in a high elected political position) all rank Bulgaria at the bottom end of EU countries, pointing to widespread discrimination.
There is currently no legal recognition of same‑sex unions in Bulgaria, neither in the form of marriage nor civil unions, and the Bulgarian Constitution explicitly defines marriage as a union between a man and a woman. The European Court of Human Rights (ECHR) recently ruled that the lack of legal recognition for same‑sex relationships, including the refusal to recognise same‑sex marriages entered in other countries, constitutes a violation of the right to private and family life as guaranteed by the European Convention on Human Rights (ECHR, 2023[24]). Nevertheless, there are currently no plans to create a legal framework to recognise same‑sex unions. Same‑sex couples cannot adopt and lesbian couples do not have access to in-vitro fertilisation.
Bulgaria has undertaken some legislative steps to combat discrimination against the LGBTQI community, but stronger action is needed to effectively reduce social exclusion of this group. In 2015, Bulgaria banned discrimination based on gender identity, adding to a ban on discrimination based on sexual orientation that had already been in place since 2004 (Republic of Bulgaria, 2004[25]). Nevertheless, discrimination is common and hate crimes occur. In 2023, Bulgaria amended its Penal Code to include sexual-orientation-related motives as aggravating circumstances for a crime, leading to more severe penalties for ostensibly homophobic hate crimes (Republic of Bulgaria, 2023[26]). By contrast, Bulgaria is one of only six EU countries not to have ratified the Istanbul Convention on Preventing and Combating Violence Against Women and Domestic Violence, because of its reference to the term “gender” (see main text in Section 5.3.3).
5.3.3. Bulgaria is one of six EU countries not to have ratified the Istanbul Convention on violence against women
Bulgaria is one of six EU countries – along with Czechia, Hungary, Latvia, Lithuania, and the Slovak Republic – not to have ratified the Council of Europe Convention on preventing and combating violence against women and domestic violence (the “Istanbul Convention”). An initial decision by the Bulgarian Council of Ministers in January 2018 to adopt a proposal to Parliament to ratify the Convention was met with backlash, and the Bulgarian Government at that time postponed ratification and transferred the decision to the Bulgarian Constitutional Court. In July 2018, the Court ruled that the Istanbul Convention does not comply with the Bulgarian constitution, because the Convention’s reference to the term “gender” as a social construct distinct from biological sex is not in line with the Constitution’s understanding of a binary gender as the unity of both biological and social dimensions.
The prevalence of violence against women in Bulgaria is difficult to assess, but recent survey data suggest a lower incidence than in most EU OECD countries. In a new survey on gender-based violence against women and other forms of inter-personal violence (EU-GBV), 21% of ever‑partnered women in Bulgaria report having experienced psychological, physical or sexual violence by an intimate partner. In 14 of the 15 EU OECD countries for which data are currently available the rate is even higher than this (Eurostat, 2023[27]). In the same survey, 12% of women in Bulgaria report having experienced sexual harassment at work – also this share is lower than in nearly all EU OECD countries (Eurostat, 2023[28]). However, such survey data may not be very reliable and comparable across countries, and Eurostat highlights that the survey results “depend on the willingness of the respondent to disclose any violence experienced” pointing to the need to “take into account the extent to which violence is tolerated in the wider community” (Eurostat, 2023[29]).
A number of strategic framework documents and policy initiatives in Bulgaria are concerned with fighting gender‑based violence. “Combating sex-based violence and protecting and supporting victims” is one of the priority areas of Bulgaria’s above‑mentioned National Strategy for Promoting the Equality of Women and Men for the period 2021‑30 and the corresponding Action Plan for 2023‑24. The Bulgarian Council of Ministers adopts annually a National Programme for the Prevention and Protection from Domestic Violence. An ongoing project on preventing and counteracting violence against women and domestic violence under the National Institute of Justice aims at strengthening law enforcement and administrative capacity for a more effective implementation of established protection standards and institutional practices in this area. Following a particularly shocking case of violence committed on a young woman by her ex-partner, the Bulgarian National Assembly adopted in August 2023 changes to the Act on Protection from Domestic Violence Act. The amendment notably extended protection rights to people who experienced violence in the context of an intimate relationship even if they are neither married to, nor in a current relationship with, their potential abuser. However, the amendment has been criticised for focusing alone and explicitly on intimate relationships between a man and a woman.
Bulgaria has a pension system combining fully-funded and pay-as-you-go components. It consists of: a mandatory public defined-benefit pay-as-you-go pillar (pillar I), a fully-funded defined-contribution pillar (pillar II) and fully-funded defined-contribution voluntary pensions (pillar III) (Republic of Bulgaria, 2020[30]). Pillar I is designed to cover all people who work, including regular employees, various types of non-standard workers and self-employed workers (Republic of Bulgaria, 2003[31]). It is financed through employer and employee contributions (8.22% and 6.58% of contributory income, respectively, for most employees), as well as general government budget covering non-contributory periods (Republic of Bulgaria, 2020[30]; MISSOC, 2023[32]). Pillar II consists of two types of pension funds, one specifically for individuals working in hazardous occupations (Professional Pension Funds), and one for all people insured under pillar 1 and born in 1960 or later (Universal Pension Funds). Pillar II was initially mandatory for every employed or self-employed person born after 1959, and inaccessible to people born before 1960. Today, Universal Pension Funds have become automatic enrolment pensions with the possibility to opt out of pillar II and channel all contributions towards pillar I. This implies a partial reversal of Bulgaria’s shift towards a diversified pension system consisting of a pay-as-you-go and a fully-funded component (Republic of Bulgaria, 2020[30]). Pillar III pensions are fully funded and are organised by private pension funds. Contributions are entirely voluntary and are tax-exempt up to given thresholds.
Bulgaria underwent a major pension reform in 2015, aiming to strengthen the financial sustainability of its pension system. The reform included: a gradual rise and an equalisation of the statutory retirement age to 65 for both men and women; an increase in the required contribution history; an increase of pension contribution levels; the possibility to shift funds from the second pillar to the first pillar and direct all contributions to pillar I only. Through these measures, the reform reduced the implicit debt of pensions in Bulgaria, improving the financial viability of the system, even though future efforts might be necessary to guarantee financial sustainability in the long-term (Petkov, 2020[33]; European Commission, 2021[11]).
There is a close link between earnings history and pension levels. The net replacement rate (for future retirees) is virtually identical for low- and average‑wage earners, reaching about two‑thirds of previous earnings (Figure 5.6.). Compared to other OECD countries, theoretical net pension replacements are well above the OECD average for the average earner, but close to the country average for low-wage earners, as pension replacement rates in most countries tend to be more progressive than in Bulgaria. Replacement rates for high-wage earners are lower, as they are above the contribution ceiling for pillar II.
Net pension replacement rates as a percentage of previous earnings, 2022
Note: Net replacement rates give the theoretical future entitlements of a person entering the labour market in 2022 at age 22 and retiring at the earliest possible age without penalty. They assume that all legislated changes to the pension system have been implemented, and do not account for the recent high rates of inflation.
Source: OECD (2023), Pensions at a Glance 2023: OECD and G20 Indicators, https://doi.org/10.1787/678055dd-en, Table 4.4.
Although theoretical pension replacement rates for future retirees are above the OECD average, pension adequacy remains an issue. In 2022, 58% of people aged 65 and over faced material deprivation in Bulgaria, comparing to 24% of 18‑64 year‑olds (Eurostat, 2023[34]). The precarious situation of older Bulgarians is driven by low wage levels leading to low pension levels, a low degree of redistribution within the pension system and short contribution histories for some population groups. In addition, although not directly linked to the pension system, Bulgarians face high personal healthcare expenditures, adding to their challenges of older people (European Commission, 2021[11]). Overall, while Bulgaria’s pension system is designed to increase incomes of future generations of retirees, especially if real wages continue to increase, pension adequacy is currently still a challenge, confronting older people with financial difficulties.
References
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← 1. Data for Australia, Canada and New Zealand are reported by fiscal year, not calendar year, such that the 2019 results may include some COVID‑19‑related public expenditures.
← 2. The minimum income on which social-security contributions are due is differentiated across 85 groups of economic activities and nine major occupational groups within these activities. Groups of workers who are unlikely to earn just the minimum wage pay minimum contributions at a level higher, which is meant to reduce incentives to under‑declare their earnings (Bogdanov, 2020[37]; OECD, 2023[4]). A separate minimum insurance income of BGN 933 (EUR 477) applies for self-employed workers.
← 3. In cases where employment is ended voluntarily or as a result of misconduct, jobseekers are only entitled to the minimum unemployment insurance benefit amount of BGN 18 per day, about EUR 9.20.
← 4. For example, the “reference poverty line” used for determining benefit entitlements in 2024 is BGN 6 311 per year, or BGN 526 per month. This equals the Eurostat poverty line for the year 2022 based on EU‑SILC income information for the year 2021 (Eurostat, 2024[36]).
← 5. Rates of benefit non-take‑up are inherently difficult to estimate. A microsimulation analysis, which however is based on 2007 income data, finds that depending on the definition more than 40% of eligible households did not claim social assistance benefits in Bulgaria (Tasseva, 2016[35]).
← 6. The EIGE ranked Bulgaria 16th out of the 27 EU member states in its 2023 Gender Equality Index, an improvement by two places relative to 2020. The Index scores countries along various dimensions in six main areas: work, money, knowledge, time, power, and health.
← 7. The four questions are: whether it is acceptable for men to cry; whether women are more likely than men to make decisions based on their emotions; whether the most important role of a woman is to take care of her home and family; whether the most important role of a man is to earn money.
← 8. This estimate is based on data from the European Working Conditions Telephone Survey (EWCTS), which was conducted between March and November 2021, and the results from this survey hence reflect the situation during the second year of the COVID‑19 pandemic. The gender gap in unpaid work in 2021 may well have been different than before or after the pandemic.