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The Government of Ingrida Šimonytė modified the draft state budget for 2021 prepared by the Government of former Prime Minister Saulius Skvernelis.
Photo by Arno Strumila / 15min / Ingrida Šimonytė
The revised state budget project for 2021 foresees that the deficit of public administrations in 2021 will amount to 7%. gross domestic product (GDP) and will be 2.1 percentage points of GDP higher than previously forecast.
General government debt in 2021 will amount to 51.9 percent. GDP and will be 1.7 percentage points higher than expected.
At a press conference, Prime Minister I. Šimonytė assured journalists that the draft budget had to be reviewed for various reasons, for example, needs that were previously enshrined in law (such as the indexing of pensions).
“And probably the biggest challenge, the biggest problem and the biggest change is related to the situation of livestock. The funds were provided only to the extent necessary to pay the December bills, as it turned out, not even for that. And the same measures that are needed for longer, so much business support, downtime and sick maternity benefits for parents who must stay with their children, ”said the Prime Minister.
I. Šimonytė also stated that it would transparently reflect the expenses in the budget and would not hide them below the borrowing limit.
Costs increase by a billion
The main news is that budget expenditures are increasing by 1.2 billion. EUR up to 15.8 billion euros. Expenses exceed revenues by $ 4.57 billion. euros.
Most of the additional funds: 934 million. It is planned to manage the consequences of the COVID-19 pandemic.
“We tried to bring the budget closer to the situation and priorities; an important point is that the budget proposal did not have the necessary funds to handle the pandemic situation, especially for the recurring quarantine. Most of the increase – covid measures ”, stressed Prime Minister I.Šimonytė during the meeting.
Finance Minister Gintarė Skaistė pointed out that most of the funds allocated for the management of the pandemic are 480 million. It is intended to provide an additional € 1 billion to the Ministry of Social Security and Labor for sickness and disability benefits, wage subsidies and job search subsidies.
Sigismund Gedvila / 15min photo / Amber Skaistė
230 million 145 million euros are allocated to the Ministry of Economy and Innovation for subsidies, soft loans, partial compensation of interests for companies affected by COVID-19, as well as for the Ministry of Health. for the purchase of vaccine, treatment and purchase of medical equipment and other costs.
“We are planning funds that, as we imagine, will be sufficient for half a year, if this situation continues for half a year, but if we see that the situation is prolonged or additional funds are needed, then the budget proposal will be reviewed,” promised I. Šimonytė .
Income will decrease
G.Skaistė stated that general government revenue in 2021 will decrease by 682 million. compared to the original draft.
The main reason for this – 744 million are not planned. Income and, consequently, expenses of the Recovery and Resilience Fund, which were included in DNA’s plan and budget. It is true that these funds have not yet reached Lithuania.
I. Šimonytė stated that this was done taking into account the risks that the money could reach Lithuania much later than the approved expenditures.
“There may have been a situation where projects start out with debt and then there is simply no fund income that could cover that debt,” the prime minister explained.
123RF.com nuotr./Pinigai
He also mentioned that the DNA plan is a plan of the outgoing government and the new government has other priorities.
“More so because we do not have the income from this fund, it was planned as income, we collected it from both income and expenses, because first of all, what we have to do after the budget rush, we have to sit down and plan according to priorities. the Government to use the funds from the Recovery Fund, ”said the Prime Minister.
I.Šimonytė added that he will then present the budget for the adjustment and plan the projects in next year’s budget, because it is not possible to do it now.
“We will postpone, coordinate with the European Commission, adjust the budget and start implementing projects according to the priorities we have set,” said I. Šimonytė. He stated that the budget could be revised in June.
“There was a lot of fog in the DNA plan”
Meanwhile, he talks about 6 billion. I. Šimonytė stated that the projects included in the plan included in the plan.
“I have to upset people who are impressed by the large number of numbers, because there was a lot of fog of those 6 billion. One package includes projects that are already budgeted under the old EU financial perspectives.” The projects that they have been contracted, contracts have been signed, they are being executed, they are simply being paid for, “said the Prime Minister.
“Basically, what was already in the budget, plus the Recovery Fund money, is put together in a pile, all of this is tied up with a red ribbon and is called a DNA plan,” said I. Šimonytė.
According to her, the projects previously planned will be executed, only the projects that are expected to be financed with the Recovery Fund will be suspended.
Seimas will consider it on Thursday
Meanwhile, the state budget revenue in 2021, including the European Union and other international financial aid, amounts to 11.2 billion. 132.8 million euros less than expected in the first draft budget.
Taking into account various circumstances, the collection of value added tax (VAT) is reduced by 104.4 million. 46 million euros, income tax. euros. Meanwhile, due to better planned excise tax collection in 2020, excise revenue in 2021 will increase by 13.3 million. and Personal Income Tax (PIT) – 72.4 million. euros.
The second reading of the budget in the Seimas is scheduled for tomorrow, December 17, and the adoption of the projects should take place in a few days.
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