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In June, the so-called DNA Future Economy Plan was approved to transform the economy of the country affected by COVID-19.
Basically, it is an investment plan, according to which it is expected to allocate around 6.3 million LTL for various projects by the end of 2021. euros.
Of these, new and additional investments will amount to 2,200 million. and the rest will be accelerated by previously planned projects.
About 40 percent. The funds of the DNA plan will be invested by the state, the remaining amount will be financed with the Economic Recovery Plan agreed in the European Union.
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Both the new governors and the outgoing government of Skvernel agree that these funds should be used for investment to achieve sustainable economic growth.
However, it is clear from his comments that politicians have different understandings of which investments are appropriate.
The organization is also increasing pressure on the future government to change the plan: the organization participating in the negotiations on the distribution of money asked the new Seimas to suspend the process on the day of the oath.
“Too quickly”
Discussions about the DNA plan have intensified in recent weeks at the Seimas during the 2021 state budget discussion, and not only politicians have been involved.
The chairman of the Board of Directors of the Bank of Lithuania, Vitas Vasiliauskas, warned that he intends to finance the plan from the European Recovery Fund, despite the fact that for this reason the points of the “i” have not yet been placed in Brussels.
At the political level, a consensus has been reached, but the question is how it will be implemented.
The state budget project estimates that spending for the implementation of the DNA plan in 2021 will amount to 1.6 billion. euros.
Of these, 813 million. The Economic Recovery Fund will finance 1 billion euros, but this fund and the exact amounts of grants to individual countries have not yet been approved.
“At the political level, an agreement has been reached, but the question is how it will be implemented,” said V. Vasiliauskas at the meeting of the Seimas Budget and Finance Committee.
According to him, the problems are due to the lack of clear specific criteria according to which European funds will be distributed.
You should take a break and re-prioritize.
Meanwhile, the government has already decided which projects it intends to finance with this money.
“There is a high risk that the measures we are now rushing to adopt will not meet the fund’s requirements. And that means that we will have to finance them with our own resources,” said V. Vasiliauskas.
The Bank of Lithuania estimates that, for example, if a fifth of the planned amount for 2021 was not received from the Economic Recovery Fund and the ADN plan projects were still implemented, the general government deficit would increase by 0.3 percent. . Gross domestic product.
If the amount of funds not received were even higher, there would be a more significant increase in the deficit.
According to the Bank of Lithuania, the aforementioned risk would be reduced if the provision was established that projects to be financed from the Economic Recovery Fund could be executed only after receiving the final decision on European financing.
Photo by Lukas Balandis / 15min / Vitas Vasiliauskas
“We think we are in too much of a hurry with the DNA plan for the future economy,” said V. Vasiliauskas.
“We should take a break and re-prioritize,” he added.
“It is concrete”
The new ruling majority is challenged to quickly amend the 2021 budget and therefore the DNA plan, in accordance with their wishes, as it will have to be adopted from December.
The center-right has already convened a working group to review the budget and hopes to do so next week.
From the positions of the representatives of the Lithuanian Christian National Democratic Union, the Liberal Movement and the Freedom Party it is clear that the DNA plan is not threatened with suspension, but individual projects can be “hijacked”.
“We will review the content of the projects themselves, as there are doubts as to whether they will really add value and will not simply be a one-time cost that will not have an impact on economic transformation.” 15 minutes said the conservative Gintarė Skaistė.
“The biggest obstacle is that some projects have little time to prepare and there are doubts about their recovery. This does not guarantee that we can collect more taxes and generate more income from these projects.” 15 minutes Kasparas Adomaitis, representative of the Freedom Party in the working group, confirmed.
Luke April / 15min photo / Kasparas Adomaitis
The rulers argued that the DNA plan would like to leave only those projects for which it would not be unfortunate to allocate funds from the state budget if there were problems with the distribution of European money.
However, there is no consensus on which investments to cut back.
For example, a representative of the Liberal Movement in the task force is hampered by the proposal to allocate tens of millions to the country’s airports.
“Not even Europe allows state aid to companies as there is for pandemics”, 15 minutes said Rep. Simon Gentville.
“There are just measures in that plan that are impossible to implement,” he added.
Luke April / 15min photo / Simon Gentvilas
K. Adomaitis shrugs for 37 million. investments in state-owned virtual airlines.
“It just came to our attention then. The state should go into business as little as possible,” said a member of the Seimas.
Conservative G.Skaistė said that so far these are only individual proposals, on which there is no unanimous agreement.
“As long as we look at everything individually, each person’s thoughts are their thoughts. When we meet in the coalition group, it will be clearer who we support and what we do not, ”said the MP.
Photo by Julius Kalinskas / 15min / Amber Skaistė
According to her, the position of institutions, such as the Bank of Lithuania, will also influence decisions about cutting the DNA plan.
And this one really had something to say.
V. Vasiliauskas, commenting on the measures of the ADN plan, questioned the intentions to solve the problems of the labor market by awarding targeted scholarships to students of natural sciences, technology, engineering, art and mathematics or to implement a specific student entrepreneurship project.
“It’s really necessary? Well, I don’t know, it’s a great question, “said the chairman of the board of the Bank of Lithuania.
Photo by Lukas Balandis / 15min / Vitas Vasiliauskas
He also criticized the proposal to provide money for the construction of the buildings of the Faculty of Mathematics and Information and Chemistry of Vilnius University after funding for innovations and research.
“In principle, it is concrete,” said V. Vasiliauskas.
The business asks to stop the horses
On the first business day of the new Seimas, the Lithuanian Business Confederation, which participates in the committee that approves the investments of the ADN plan, asked the government to suspend the distribution of money.
We ask current and future authorities to STOP this money-sharing machine. For the good of all of us.
According to Andrew Romanovsky, president of the organization, the DNA plan was an adequate response to expectations to boost the economy, but after a brief euphoria, things “got back on track.”
“All commercial offers were submitted to the archives and only institutional actors lined up on the DNA cornucopia,” wrote a commercial representative on Facebook.
According to him, the motto of the DNA plan became “fast and a lot”, the social partners in the investment committees were assigned only an advisory role and the authorities filled them with such a large number of documents that it was made impossible to deepen.
Photo by Luke April / 15 minutes / Andrius Romanovskis
“All the applicants are institutional actors, executors as well. We resent, we criticize, we write letters, we persuade. We ask: where are the results, where is the transformation, where is the participation of companies”, said A. Romanovskis.
“They responded, promised, consoled, persuaded us, but they went ahead,” he lamented.
According to the business representative, the culmination was the law approved by the Seimas on the implementation of the new road tax system, which said “bluntly” that 90 million. for the implementation of the new system must be assigned from the DNA plan.
“We agreed at the meeting of the Business Confederation – quite a lot. We ask current and future authorities to STOP this money-sharing machine. For the well-being of all of us,” said A. Romanovskis.
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