19-12-2020 Bulgaria’s cultural and creative industries; policies and financing

Culture and the cultural and creative industries are among the most affected sectors in Bulgaria at the national level in the last months of the crisis caused by COVID-19. As early as March 8, 2020, cultural institutions were closed and cultural events were canceled indefinitely. There are different funding models for state and municipal cultural organisations, and during a state of emergency or force majeure the budget and funding model can be changed so as to ensure the remuneration of labor in cultural institutions. A bigger problem, unresolved for almost three decades, is funding, sustainable development, survival and minimum wages in the independent, non-governmental cultural sector – private, self-employed artists and those working on a temporary contract or on a project basis.

The current situation is also a kind of stress test for cultural policy in Bulgaria; the current picture shows very clearly that there are no instruments of cultural policy that would ensure the sustainable development of the sector. In the Law for the protection and development of culture, article. 2 stipulates: “Basic principles of the national cultural policy are: item 3 Equality of artists and cultural organizations”. After all, one of the basic principles is equality – it follows that the state should take care of private, non-governmental organizations and freelance artists not only in times of crisis. Unlike all member states of the European Union and the member states of the Council of Europe, Bulgaria, unfortunately, remained the only country without working out alternative sources of funding. The lack of a National Strategy for the Development of the Arts, Cultural and Creative Industries, Cultural Heritage and Cultural Tourism further creates preconditions for a lack of clear orientation – where and what measures need to be implemented, with what intensity of support should be used cultural and creative industries, what are the specifics of work, etc.

How COVID-19 changed the situation in the arts, cultural and creative industries, cultural heritage and cultural tourism

The measures taken at national level could be divided into several groups:

General measures aimed at all economic activities at national level;

– Stimulating employment – measure 60/40 was introduced last March. Compensations under this measure are in the amount of 60 % of the amount of the insurance income of the employee and of the due insurance contributions at the expense of the employer of each employee and to whom the employment will be retained for an additional period. The measure is aimed at a wide range of economic activities, in particular for: A) Artistic and creative activities, B) Other activities in the field of culture, C) Movie projections.

In the domains of culture and cultural and creative industries, this measure is not fully used due to specifics of labour and the specifics of the activities of cultural organizations: First, the unification of measures for different sectors does not take into account the specifics of creative organizations, their specific funding, and labour. Second, lack of clarity in the Ministry of Culture  with regards to how many people are employed in cultural activities and what are the opportunities for carrying out activities during the state of emergency. Third, an unknown period of return to active work in the cultural field.

– The programme of the Bulgarian Development Bank for guaranteeing interest-free loans to help people deprived of the opportunity to work due to the pandemic of COVID-19.[i] Programme for guaranteeing interest-free loans to help people deprived of the opportunity to work due to the pandemic of COVID-19 with decision of Council of Ministers 408 / 19.06.2020 at the Bulgarian Development Bank.

The programme is about the provision of interest-free loans to those employed on an employment contract and self-insured persons. Obtaining credit has two sides – access to a fast resource in a volume that provides coverage of subsistence for at least three months, but also confidence that in the future, according to the requirements of the programme, the same activity will be carried out in a particular cultural organization. This represents insecurity and lack of specific conditions for those employed in the cultural and creative industries.

– Support to micro and small enterprises to overcome the economic consequences of the COVID-19 pandemic, Operational Programme “Innovation and Competitiveness” 2014-2020. The purpose of this measure is to provide a liquidity resource through grants to be spent on salaries and social security contributions, administrative costs, acquisition of tangible and intangible assets, etc. In implementing these measures, there was a lack of a good information campaign and coordination between the Ministry of Economy and the Ministry of Culture.

Specific programmes and measures that target the culture, cultural and creative industries at the national level

– Measures aimed at state and municipal cultural institutes: The state and municipal cultural institutes, which functioned on delegated budgets before the crisis with COVID-19, restructured the financing model, removing the requirements for revenue and the components in the formula for delegated budgets. In this way the remuneration of the employed staff is guaranteed.

– Temporary measure for VAT differentiation for books – 9%, which will be applied until the end of 2020 to stimulate final consumption. Bulgaria is one of last country in the European Union that did not have a differentiated VAT rate for books.

– National Culture Fund – Creative Scholarships Programme[ii]: The main goal of the programme is to provide financial support to Bulgarian artists and practitioners practicing a freelance profession and directly affected by the anti-epidemic measures introduced by the Ministry of Health that stop all mass events throughout the country including culture and entertainment (including theaters and concerts for example). Under the terms of the Creative Scholarships programme, each freelance artist accepted to receive support receives three minimum wages, as well as social and health insurance. The total amount of this measure is BGN 2,500,000 with 1147 free artists to have been accepted for support. Undoubtedly, this is one of the most necessary measures in culture, as it addresses the most vulnerable and affected cultural professionals – the freelancers. The application for this measure also revealed that at that time the Ministry of Culture did not have data on the number of self-employed freelance artists in culture.

The National Culture Fund scheme also includes an additional BGN 15 million, which are envisaged as a second group of measures for the independent sector and freelance artists:

BGN 12 million, which will be distributed on a project basis for 3,000 freelance artists. Projects should include Bulgarian authors, Bulgarian literature. The maximum funding is up to BGN 4,000.

BGN 3 million was allocated for structural financing of private and non-governmental organizations in the independent sector. The purpose of this programme is to provide year-round support for the development of organizations in the independent sector.

And also two completely new programmes with the restructuring of the budget of the national Culture Fund, as follows:

BGN 700,000 were allocated to circus and variety art. So far, no public funding has been provided for the circus and variety shows and such a scheme, part of the anti-crisis measures, enters for the first time as part of targeted cultural policy actions.

BGN 500 thousand was focused on the newly created Visual Arts Programme in support of visual artists.

Programmes and measures at municipal level aimed at culture and cultural and creative industries

Measures are being taken additionally at the city level since Sofia is the center of the cultural and creative industries in Bulgaria and over 85% of the cultural activities are concentrated on its territory. The Municipality of Sofia has created a programme called “Solidarity in Culture”[iii] aimed at supporting independent artists and non-institutional cultural spaces and teams in emergency situations. The programme starts with a budget of BGN 150,000 and will amount to over BGN 400,000. “Solidarity in Culture” is implemented in two directions:

– Area 1: Support for individual conceptual projects for an online cultural product or cultural event of independent artists;

– Area 2: Support for conceptual online projects of operators of cultural events that ensure the sustainability of non-institutional cultural spaces

The Solidarity in Culture programme was introduced as the first anti-crisis measure in Bulgaria. Sofia Municipality has made culture, cultural and creative industries a priority in its activities. In this direction the consistent cultural policy is carried out through the strategy “Sofia – creative capital” 2013-2023 (the first strategy for culture adopted in the Republic of Bulgaria), as well as the strategy “Sofia – creative city of film” 2016-2026.

Written by Diana Andreeva and Bilyana Tomova (Observatory of Cultural Economics)

© Photo: Kyle Loftus (retrieved from Pexels)

Footnotes:

[i] https://bbr.bg/bg/n/iziskvanija-za-kandidatite-za-bezlihven-kredit-podpomagasht-horata-lisheni-ot-vyzmojnostta-da-polagat-trud-poradi-pandemijata-ot-covid-19. Programme for guaranteeing interest-free loans to help people deprived of the opportunity to work due to the pandemic of COVID-19 with decision of Council of Ministers 408 / 19.06.2020 at the Bulgarian Development Bank

[ii] http://programs.ncf.bg/bg/programi , National Fund “Culture”, programme “Creative Scholarships”, 2020.

[iii] https://kultura.sofia.bg/calendar/section-25-formulyari_i_dokumenti.html , Sofia Municipality – Solidarity in Culture Programme, 2020.