Laima Andrikienė: ‘Our situation is not easy, but it is obvious that the 2021 draft budget under consideration reflects our reality and the legacy received by Ingrida Šimonytė’s Government and the new Seimas’.
Press release, 18 December 2020
The Seimas Committee on European Affairs discussed Lithuania’s draft budget for 2021 today.
After the meeting, Laima Liucija Andrikienė, Deputy Chair of the Committee, noted that ‘we are all aware of the EU standards and the provisions under the Stability and Growth Pact, which define the annual budget deficit and public debt that a country may have as percentage of gross domestic product (GDP). It should be noted, however, that, due to the pandemic in 2020, the clauses of the Pact, i.e. the rules of fiscal discipline, are not applied on a provisional basis.’
Photo by Olga Posaškova, Office of the Seimas
The Member of the Seimas noted that, ‘The improved draft budget for 2021, submitted by Šimonytė’s Government, is under attack from representatives of the former Government under Saulius Skvernelis, who are criticising the projected budget expenditure that is primarily aimed at combating COVID-19 and reducing the direct negative consequences of the pandemic. While considering the draft, the Seimas should, however, take note of Lithuania’s situation in the context of other EU Member States and compare Lithuania’s indicators with those of other EU Member States.’ Ms Andrikienė noted that in 2020, the average budget deficit of the EU Member States was 8.3 per cent, compared to 7.6 per cent for Lithuania. In 2021, the projected average budget deficit for all EU Member States will stand at 5.3 per cent (October data), and in Lithuania’s case (December data) it will amount to 7 per cent.
‘In 2021, our public debt is expected to reach 51.9 per cent of GDP. It will increase, compared to 2020. Obviously, our situation is not simple, but the draft budget currently under consideration reflects our reality and the legacy received by Šimonytė’s Government and the new Seimas. Behind the estimated budget expenditure there are human lives and the fight against the pandemic and its consequences. All of this comes at a price’, Ms Andrikienė said.
She also noted that ‘before the national Parliament approves the state budget, each EU Member State usually sends the draft budget to the European Commission and awaits its conclusions. Of course, the national Parliaments are free to adopt the state budget at their discretion. However, the EC’s conclusions on whether and to what extent the draft budget of a particular country is in line with the provisions of the Stability and Growth Pact are made known to the parliaments before the budget is eventually adopted. The COVID pandemic and Lithuania’s post-election situation have brought certain adjustments to this process, and the EC’s conclusions will be heard by Lithuania only after the revised budget for 2021 will have been approved. However, we all know only too well what the conclusions will be, as they are easy to predict.’
Aldona Drėgvaitė, Adviser to Dr Laima Andrikienė, Member of the Seimas, tel: +370 5 239 6723, e-mail: [email protected]
Monika Kutkaitytė