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Simulating Welfare Impacts of Changes in the Monthly Social Allowance Scheme and Heating Allowances in Bulgaria

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dc.contributor.authorRobayo-Abril, Monica
dc.contributor.authorCabrera, Maynor
dc.date.accessioned2024-06-26T16:47:29Z
dc.date.available2024-06-26T16:47:29Z
dc.date.issued2024-06-26
dc.description.abstractBulgaria still ranks among the EU countries with the highest levels of poverty and inequality. Before 2023, Bulgaria's Social Assistance / Monthly Social Allowance scheme had limited coverage, strict eligibility criteria, and limited impact on poverty reduction. Additionally, it was not adjusted or linked to inflation. The Bulgarian government introduced a reform in 2022 aimed to increase the scope and access of individuals to social support by increasing the basis for determining the differentiated minimum income threshold (now 30 percent of the relative poverty line) and the parameters linked with age, health condition, and social status, affecting the social programs anchored to it, such as the Monthly Social Allowance and the heating allowance. This paper assesses this reform's potential ex-ante poverty and distributional impacts, relying on a comprehensive tax/benefit system assessment called the Commitment to Equity and microsimulation techniques. The changes in the legal basis for determining access to social assistance introduced with the reform are expected to create some relief from the indexation of the benefits over time. They will now be tied to the evolution of the relative poverty line and, therefore, linked to the evolution of median income. The results of the policy simulations show that the combined effect of the changes in the Monthly Social Allowance and the heating allowance contributes to a slight reduction in the poverty gap but not enough to move a sizable share of people out of poverty, as shown by the negligible impact on the at-risk-of-poverty rate. Inequality is barely affected. Compared with a Bulgarian food basket, the results show that eligibility thresholds are still restrictive. These results suggest further scope for improvement in the design of these programs, including anchoring them to an absolute poverty line or basic consumption basket.en
dc.identifierhttp://documents.worldbank.org/curated/en/099842206242412660/IDU130619a29105a81435618e2f19c5d7a9ab052
dc.identifier.doi10.1596/1813-9450-10817
dc.identifier.urihttps://hdl.handle.net/10986/41780
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.relation.ispartofseriesPolicy Research Working Paper; 10817
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by/3.0/igo/
dc.subjectGUARANTEED MINIMUM INCOME
dc.subjectMEANS TESTING
dc.subjectPOVERTY
dc.subjectFISCAL INCIDENCE
dc.subjectSOCIAL SPENDING
dc.subjectBULGARIA
dc.subjectNO POVERTY
dc.subjectSDG 1
dc.subjectDECENT WORK AND ECONOMIC GROWTH
dc.subjectSDG 8
dc.subjectPOVERTY REDUCTION
dc.titleSimulating Welfare Impacts of Changes in the Monthly Social Allowance Scheme and Heating Allowances in Bulgariaen
dc.typeWorking Paper
dspace.entity.typePublication
okr.date.disclosure2024-06-26
okr.date.lastmodified2024-06-24T00:00:00Zen
okr.doctypePolicy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/099842206242412660/IDU130619a29105a81435618e2f19c5d7a9ab052
okr.guid099842206242412660
okr.identifier.docmidIDU-30619a29-05a8-4356-8e2f-9c5d7a9ab052
okr.identifier.doi10.1596/1813-9450-10817
okr.identifier.doihttps://doi.org/10.1596/1813-9450-10817
okr.identifier.externaldocumentum34348350
okr.identifier.internaldocumentum34348350
okr.identifier.reportWPS10817
okr.import.id4599
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099842206242412660/pdf/IDU130619a29105a81435618e2f19c5d7a9ab052.pdfen
okr.region.administrativeEurope and Central Asia
okr.region.countryBulgaria
okr.sectorCentral Government (Central Agencies)
okr.themeInclusive Growth,Mitigation,Participation and Civic Engagement,Gender,Human Development and Gender,Economic Policy,Social Protection,Social Development and Protection,Economic Growth and Planning,Environment and Natural Resource Management,Labor Market Policy and Programs,Climate change,Adaptation,Social Inclusion,Social Safety Nets,Labor Market Institutions
okr.topicPoverty Reduction::Access of Poor to Social Services
okr.topicPoverty Reduction::Employment and Shared Growth
okr.topicPoverty Reduction::Moving Out Of Poverty
okr.topicPoverty Reduction::Poverty Reduction Strategies
okr.topicSocial Protections and Labor::Social Protections & Assistance
okr.unitEFI-ECA-POV-Poverty and Equity (EECPV)
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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