Šapoka in the Seimas: Lithuania’s budget deficit will be one of the smallest in the EU

In 2021, it is planned to raise 11.38 billion in the state budget. 150 million euros of income. EUR or 1.26%. less than planned this year. The draft, approved by the government, estimates that spending next year will be $ 15.49 billion. 271 million euros. EUR or 21.22%. more than planned this year.

According to the Ministry of Finance, this year the budget deficit should reach -8.8 percent. GDP, -2.7% in 2022 and -1.6% in 2023, when the goal of the structural balance is -1%.

In 2021, the government plans to borrow about 5.14 billion. euros. Public debt in 2021 should reach 50.2 percent. GDP, in 2022: 49.4 percent. GDP, and in 2023 – 50.3 percent. GDP.

V. Šapoka told the Seimas members that the project is based on several priorities.

“Next year’s budget is based on very clear priorities. First, when there is a lot of uncertainty about the future, we must live up to the commitments made in previous years, with special attention to the most vulnerable groups, because it is about trusted in the state.

Second, the crisis situation in the world also opens opportunities for a faster transformation of the country’s economy, which is why it is necessary to invest in the future, in the “DNA of the Economy of the Future”. T. and. invest in human capital, science and innovation, the digitization of the economy, the green path, the infrastructure of the economy of the future.

Third, the situation is very vague, so we must be especially careful. Not only must we avoid new long-term commitments that are not backed by sustainable finance, but we must fundamentally freeze the growth of other expenses. Only then will we be able to stabilize the growth of the debt / GDP ratio. That is what is planned in this project, ”said V. Šapoka.

The minister said that Lithuania’s budget deficit will be one of the lowest in the European Union.

“There are countries that significantly outperform and consequently Lithuania will maintain one of the lowest public debts in the EU,” he said.

Uncertainties about DNA

Seimas member Ingrida Šimonytė pointed out that next year the Ministry of Finance expects a very significant increase in government consumer spending.

“Even from this year’s level, when it was very notable for the Covid-19 situation. Investment growth is expected to be relatively modest. How do these projections fit with the numbers you presented? “, I ask.

V. Šapoka replied that this is due to the uncertainties that persist in the “DNA of the future economy” plan.

“Many actions by classification (until it is clear if the final projects will be the so-called solid investments that would increase gross capital formation) are included in other expenses and, therefore, they are included in other government expenses but not in investments. The situation will change drastically when specific projects are known ”, he said.

The minister also said that an average of 1 euro invested in a DNA plan should generate a return of about 2 euros.

“When it comes to investment in infrastructure, to attract foreign investment, it will certainly not be the lion’s share, and the biggest increase in the new measures is the doubling of investment in human capital and in science and innovation. (…) There are measures in which 1 euro invested will bring a return of 10 euros to Lithuania, ”said V. Šapoka.

You can find out for whom the budget appropriations increase next year and for whom it decreases in the Delfi analysis.

After the presentation, the budget proposal will be considered in all Seimas committees. He is expected to return to the Chamber on November 24 and December 17.

Sodra’s budget proposals and the Mandatory Health Insurance Fund for next year will be presented to the Seimas on Tuesday.

Sodra’s budget revenue in 2021 is projected to reach 5.02 billion. 129 million euros. EUR or 2.6 percent. higher than this year and spending 5.01 billion. 462 million euros. EUR or 10%. larger. It is estimated that 14 million euros surplus.

PSDF’s budgetary income and expenses should be the same next year, at 2.37 billion. euros. Compared to 2020, they increase by 65.2 million. EUR or 2.8%.

For the first time, the draft budget of the Pension Annuity Fund for 2021 is presented to the Seimas. It estimates operating income at 4.1 million euros. EUR, and expenses – 614 thousand. euros. Investment costs in 2021 should amount to 3.7 million. EUR and income: 34.7 thousand. euros. The fund still plans to receive around 300,000. loans in euros.

As you know, Sodra has become a centralized payer of pension annuities since July 1 of this year.