VILNIUS - The Lithuanian government has approved the 2009 draft budget due to be submitted to Parliament Friday, Oct. 17, Baltic News Services reports. The draft budget is expected to include a deficit of 2.639 billion litas (764.9 million euros) for 2009. This amounts to 2.3 percent of projected gross domestic product.
Outgoing Prime Minister Gediminas Kirkilas claims that the deficit would only be marginal and was quite sustainable.
"The deficit will exceed 2 percent. The situation is not tragic since our deficit will be among the lowest in the European Union. Yet, the deficit cannot be avoided due to numerous obligations, including a long-term program on the raising of wages for teachers, social and cultural workers, which will require more than 1 billion litas. On top of that, there are other obligations, including the raising of pensions, reimbursement of heating costs, etc. Those things will cause the deficit," Kirkilas said in an interview with the public radio station Lietuvos Radijas (Lithuanian Radio).
Public expenditures will increase next year, while revenues will decline.
In 2009 spending by the central government is expected to increase by almost 1.6 billion litas to 28.172 billion litas. National income for this year will total 25.533 billion litas in 2009, including 5.274 billion litas in EU support funds.
Without EU support national income is expected to be about 200 million litas in 2009, roughly a percentage point lower than national income in 2008. The revenues of the national budget, which includes the central government and municipal budgets, will increase by 800 million litas compared with 2008, to 30.199 billion litas (with EU funds) in 2009. The expenditures will grow by 1.5 billion litas, year-on-year, to 32.838 billion litas.