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“The previous government, so to speak, has hidden some things, so the budget deficit is increasing compared to the original draft,” the head of state told a news conference on Monday.
However, he emphasized that in times of crisis, it is natural for public spending to be greater than income.
“As an economist, I have never been a dogmatist and have always advocated an active countercyclical policy,” said G. Nausėda.
“We need to follow an active fiscal policy, which means that public spending in those periods cannot, of course, be financed with adequate revenues,” he emphasized.
The president also highlighted the need to think about how to return to a balanced budget once the economy recovers.
Ingrida Šimonytė’s revised draft budget provides for 7%. General government deficit of gross domestic product (GDP). The Saulius Skvernelis government planned no more than 5 percent. deficit.
According to the new government, a larger deficit is expected, as no funds have been earmarked to combat the coronavirus pandemic until then.
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