Pari pod masata (Bulgaria)

Pari pod masata 🇧🇬
Location: Bulgaria
Definition: Lit. "money under the table", gifting or tipping as gratuity for health and education services
Keywords: Bulgaria – Balkans – Europe – EU – Healthcare – Education – Gratuity – Tip – Gift – Payment – Money – Facilitation – Public service
Clusters: Economies of favours
Author: Kristina Tsabala
Affiliation: Alumna, School of Slavonic and East European Studies, University College London, UK

By Kristina Tsabala, Alumna, School of Slavonic and East European Studies, University College London, UK

Pari pod masata is a colloquial term in Bulgarian that refers to informal payments to public officials. It literally translates as ‘money-under-the-table’, ‘money-under-the-counter’ or ‘under-the-counter-payments’. These informal payments made by citizens to public servants, consist of cash and/or commodities for favours in public sector (healthcare, administration, education and customs). The favour provided by the public servant takes the form of preferential treatments such as faster provision, ensured quality, or evasion of state regulations. On the one hand, it is related to the shadow economy because it is an unregulated transaction and represents administrative and civil misbehaviour. On the other hand, money-under-the-table is associated with tipping and gift giving because it is culturally accepted in Bulgaria to express gratitude materially to the servant for his/her time and attention (Grodeland, Koshechkina & Miller 2000: 309). The prominence of this practice has been shown in the annual report of the European Commission for 2019 where Bulgaria figured at the first place in the EU by size of informal payments in the healthcare sector (European Union 2019: 56). Pari pod masata is far from unique. Analogous practices can be found in Greece (fakelaki), Latvia (aploksne), Hungary (hálapénz, paraszolvencia), Middle East and North Africa (baksheesh).

Although studies of informal payments started being reported only after 1989, films and literature have described Pari pod masata transactions during the socialist regime. Due to the shortage of commodities, gifts were a widespread practice that recognised the official’s personality outside of his/her job and aimed at establishing a personal relationship that would later lead to the use of informal networks, known in Bulgaria as vruzki (Chavdarova, 2018, p. 64-67). The comedy Toplo (Warmth) of 1978 illustrates the hardships of installing a central heating system in a building in the city center of Sofia. In the scene when the residents of the building discuss what is necessary to hand in the inquiry for the installation to the council of Sofia, they state that they had filled the document forms and collected the Pari pod masata (Yanchev 1978). This scene implies that if they do not provide the informal payment alongside the necessary documents, their inquiry would not be handed in to the competent officials.

The transition to market economy after 1989 is commonly seen as the catalyst of informal payments in Bulgaria. Economic reforms during the 1990s intensified the popularity of informal transactions and in-kind payments due to the unstable socio-economic situation caused by market liberalisation. The frequency of informal payments is also associated with the presence of clientelism (vruzki) because informal transactions are used when informal networks are absent.

The economic crisis of 1997 in Bulgaria set a precedent on alternative transactions. Due to rapid inflation the Bulgarian lev lost its value overnight. Consequently, public servants started not to accept cash payments but required alternative commodities, especially food. Thus, goods and cash became mutually substitutable. In 2000, the Bulgarian government introduced a reform that was expected to regulate informal payments in healthcare (Stepurko et al., 2013: 420). The reform consisted of installing additional formal co-payments for the health services in the benefits package. Nevertheless, a study conducted on 1,003 people in July 2010 showed that 20% of the respondents had reported paying informally in cash in the past year and 45% of them giving gifts in-kind (Atanasova et al., 2013: 733). This can be considered an improvement given that in 1997, 86% of the respondents thought that ‘it is impossible to obtain adequate health care without giving bribes’ (Balabanova & McKee, 2002: 264).

Pari pod masata identifies extortion when public officials act as gatekeepers. For example, medical officials can also require the payment of an unofficial fee for the general access to free treatment. Similarly, during the 1990s transition to market economy, the low salaries of public administrative officials led them to demand unwarranted fees for obtaining a document, state provisions, or filing institutional inquiries (Grodeland, Koshechkina & Miller, 1997: 655). Public servants resorting to extortion might abuse their power even further by establishing an informal ‘levy’ (red tape) or ‘toll’ (Blundo & Olivier de Sardan 2006: 77). This is most frequently reported in relation to custom officials who act as informal tax collectors over travelers’ possessions (PARITENI 2014). A custom official can earn between 900 and 1,200 euros for a shift at the border with Serbia (24Chasa 2020). They demand informal payments to allow people to access certain administrative and state entities without confiscating anything, regardless the legality of passengers’ belongings.

In the healthcare sector, Pari pod masata might be offered to the doctor by the patient or his relatives to receive a quicker provision or to ensure the good quality of the treatment. If the payment is given in advance (ex-ante), then it bears the resemblance of a bribe. However, the payment can also represent a gift when it is given at the end (ex-post) of the treatment, to show gratitude. This conceptual timeframe is important because it differentiates bribes from gifts. Nevertheless, an ex-post payment becomes ex-ante for a future exchange transforming the gift into bribe (Moldovan 2013: 386). Expensive gifts might create preferential relationships between the parties (Balabanova & McKee 2002: 251). The Bulgarian Physicians’ Union differentiated officially ex-ante and ex-post payments, and the latter was described as ethical (Delcheva, Balabanova & Mckee, 1997: 91).

In the public education sector, Pari pod masata takes the form of unreported donations for the educational institutions that lack state funding. It is a common practice for public schools in Bulgaria to require unofficial donations from the parents to improve infrastructures and facilities. These payments are destined for repairs, heating, events, presents, the purchase of extra materials and participation in extracurricular activities. These so-called donations are unregulated but sometimes mandatory.

In 2001, 34 % of the population considered informal payments as an unchangeable aspect of the country’s culture (Grodeland, Koshechkina & Miller, 2001: 140). Gift giving, in particular, was seen as legitimate because means to express gratitude and respect to the public servant. Media coverage of informal payments peaked at the turn of the century when major anti-corruption legislation was introduced, and the debates regarding informal payments entered the public discourse following international scandals. For instance, in 2002 Greece declared that it would not accept higher education diplomas issued from Bulgarian universities because of the widespread bribes in the sector. According to media investigations, in the 2000s an exam passing costed between 150 and 300 US dollars (Coalition 2000 & CSD, 2005, p. 14). Nowadays, informal payments remain widespread: The Global Corruption Barometer for 2019 reported that 12% of public service users had given a bribe in the past year (Transparency International, 2019). Unregulated donations, showing gratitude to teachers, doctors and officials is still considered a cultural phenomenon rather than immoral behaviour.