Lithuanian president: pensions must grow faster than average wages

  • 2021-09-08
  • BNS/TBT Staff

VILNIUS – Old-age pensions in Lithuania must grow at a faster rate than average wages, taxes must be fairer and more proportionate, the regional divide must be narrowed and the financial literacy of municipalities must be increased, President Gitanas Nauseda said on Wednesday. 

The president was speaking after meeting with Viktorija Cmilyte-Nielsen, the speaker of the parliament, and other members of the Board of the Seimas to discuss the parliament's agenda for the autumn session opening on Friday. 

"We need to continue with the policy that we started in 2020: old-age pensions must grow faster than average wages in order to give senior citizens, who are particularly vulnerable to growing inflation, sufficient support," he told reporters. "The state must pay back its debt to the people who through their work contributed to the prosperity of this state."  

Nauseda said that now is the time to overhaul the tax system, adding that this does not mean that taxes should be raised.

"[We need] more tax fairness and more tax proportionality, but this is far from meaning that taxes have to be higher," he said. "We still have many imperfections that we correct without increasing the tax burden." 

Lithuania's average gross monthly wages rose by 12 percent in the second quarter of 2021 compared to a year ago to 1,566.4 euros. Average net monthly wages increased by 11.8 percent to 994.4 euros.  

The average retirement pension stood at 413.8 euros and the pension with the necessary length of service at 441 euros in July.   

The government has promised to increase pensions at a faster rate over the next three years.  The plan is to improve the indexation system to ensure that the average pension rises to 462 euros next year, 499 euros in 2023 and 534 euros in 2024. The average pension of those who have the have the necessary length of service would go up to 486 euros, 527 euros and 566 euros, respectively.