More assistance to the Bulgarian business at the time of COVID-19
by Yoanna Arabadzheva, Alexander Goudev and Plamen Markov
During the Spring 2020 semester, students taking Social Policy and Politics in the EU course worked in groups to socially-oriented campaigns. In their presentations and campaign descriptions they were to outline the rationale for your campaign; measures / actions that the campaign will involve; its target audience as well as its projected outcomes. On the course’s website, we will present several of their ideas in the form of separate posts.
The recent CORONA-19 pandemic has deeply affected the entire world. Many businesses have had to close down, oil prices have dropped and more importantly people are unable to find work. Due to many workers not being essential and to protect themselves, they have been told to remain at home and not go outside without need. While for some this is a pleasant vacation from the huge amounts of work and others can work from home if need be, for many people, especially in Bulgaria, this is a complete nightmare. The statistic shows that the unemployment rate for March 2020 stood at 6.7%. There are 220,072 unemployed people registered at the Bulgarian public employment center, with many of them (26,286) registered after the emergency situation. The hotel and restaurants sectors are the one most affected by these changes as they typically employ low-skilled temporary labor. The people working in this sector can barely make ends meet, usually moving from one job to another or only being able to work part-time. Measures need to be introduced to help these workers recover once the situation returns to normal.
The Bulgarian authorities have put forward the 60/40 assistance scheme as a way to deal with the economic situation after the pandemic. The plan is for the state to pay 60% of the expenses on wages and social-security benefits to the employer so he can keep his employees and not have to fire them. The other 40% is paid by the employer himself. The scheme will target the sectors that will be most affected by this change, including tourism and restaurants and etc. As they usually rely on part-time workers, this will be important. In order to qualify, employers will either have to have been closed by order of the state or closed on their own and prove that they would incur losses from the business being stopped.
On paper the scheme looks fine but in reality it is flawed. First, to cover 40% of the labor-related expenses can be too much for some of the sectors. Without revenue, they cannot contribute their share of workers’ pay and social payments. Another issue is that the process itself can be confusing or some aspects not being well implemented, such as those related to electronic signatures. As such many companies will be unable to make use of this scheme and have to lay off workers anyway.
The goal of the campaign is to give the people from the restaurant and night club sector a voice. Due to the circumstances a regular protest is impossible, so we will organize an online one. Chairs with signs with the names of all participating night clubs and restaurants will be placed in front of the Council of Ministers, separated by 2 meters from each other, as the official social distancing requirement has it. On a large screen near the chairs, the demands of the owners and managers of these companies for more financial support will be broadcast from Facebook. These would include, first and foremost, the change of the proportion of the scheme’s assistance from 60/40 to 80/20 measure as well as a tax break until the end of the year. The outcome of the campaign will be to have these demands be heard and possibly discussed with the relevant ministers. Our social partners are the associations of hoteliers and restaurants.