a healthy diet in Bulgaria was EUR 169 for a single person and EUR 635 for a family of two adults and two children. If the budget needed for physical activity and for the other functions of food (eating out, holidays, etc.) is also taken into consideration, the total monthly food budget amounted to EUR 196 for a single person and EUR 690 for a family of two adults and two children (Table 3).<sup>23</sup> When converted to 2020 Bulgarian Levas using official food CPIs, these monthly food expenditures correspond to BGN 387 for a single person and BGN 1,455 for a family of two adults and two children. In relation to the AROP poverty line, the cost of a food basket for a single person amounts to approximately 76% of the 2021 AROP poverty line (based on the 2020 income year). The corresponding food basket represents about 137 percent of the AROP corresponding poverty line for a family consisting of two adults and two children<sup>24</sup> .

**Table 3** . **Cost of Food Basket Estimates, Monthly Average**

||2015<br>Euros|2015<br>BGN|2020 BGN|
|---|---|---|---|
|Single Person|169|330|387|
|Single Parent and One Child|330|644|755|
|Single parent and Two Children|490|958|1,122|
|Family of two adults and one child|499|975|1,142|
|Family of two adults and two children|635|1,242|1,455|
|Single Person, Including physical activity and other functions|196|383|449|
|Family of two adults and two children - Including physical activity and other functions|690|1,349|1,581|

_Source: Own estimates based on EC reference food baskets, official Food CPI estimates, and a 2015 exchange rate of 0.5114 EUR/BGN._

**While significantly less restrictive, the new income eligibility thresholds resulting from the reform are still below the Bulgarian food basket for all household types; this means that Bulgarian families who have insufficient income to satisfy adequate food intake but are still above the current eligibility thresholds are not eligible for the MSA benefit.** We compare the food basket's cost with the family's differentiated minimum income for different family types before and after the reform (Figure 8). The comparison shows a substantial increase in the minimum income thresholds; however,  the food basket cost is still significantly higher than the eligibility thresholds for different family types, suggesting that the post-reform income thresholds are still restrictive. For example, a Bulgarian family of two parents with two children earning more than 605 BGN per month in 2020 is not eligible for the MSA benefit, given that their income surpasses the maximum income threshold. However, the monthly budget in 2020 needed for an adequate food intake for this family is estimated to be 1,455 BGN (Figure 8), while the relative poverty line (AROP) for this type of family was 1,059 BGN (in 2020).<sup>25</sup> Despite being at risk of poverty and unable to buy a minimum food basket, this family cannot cover the shortfall with the MSA benefit under the updated formula. Figure 8 below shows that these restrictive income thresholds disproportionately affect families with more children (2 or 3 children), which are overrepresented among the poor. There is scope for increasing these income eligibility thresholds closer to the levels of the Bulgarian food basket to

> 23 Source: EC, Directorate-General for Employment, Social Affairs and Inclusion, “The Bulgarian Food Basket”, 2016.

> 24 The yearly official at-risk of poverty thresholds for survey year 2021 and income reference year 2020 are 6,052 BGN for single person households, and 12,709 for a family of two adults with two children younger than 14 years, equivalent to 504 and 1,059 BGN per month.

> 25 For these types of households, the estimate of the Bulgarian food basket is slightly below the 2019 AROP poverty line (BGN 4,478 per month).

25