On Wednesday, the deputies examined the 31 accompanying bills of the budget project, in which a total of 212 proposals were submitted, while by Thursday evening, 138 proposals for the draft law on the state budget for 2025 and the budget framework for 2025, 2026 and 2027 were considered.
311 proposals have been submitted for the main state budget project.
Previously, the head of the Saeima Budget and Finance (Tax) Commission Jānis Reirs predicted to LETA agency that the Saeima budget could be considered in three days, which means that it could be adopted in the final reading today, but it depends on how quickly the work will be done.
It has already been reported that the revenues of the state’s consolidated budget for the next year are planned to amount to 15.081 billion euros, while expenses – to the amount of 17.093 billion euros.
Compared to the 2024 budget, the budget revenues planned for 2025 are planned to be 583.2 million euros higher. Conversely, expenses in 2025 are planned to be 876.5 million euros higher than in the 2024 state budget law.
Revenues planned in the basic budget amount to 10.2 billion, and expenses – 12.7 billion.Conversely, in the special budget, revenues are planned at 5.2 billion euros, and expenses at 4.7 billion euros.
Internal and external security of the country is defined as the main priority of the country.
The budget plans to set the maximum state debt ceiling at the end of 2025 in the amount of 21 billion euros, or 47.3% of GDP. Conversely, next year’s GDP is planned to be 44.379 billion euros.
The forecast of the potential GDP growth rate used in the readiness of the budget law is 2.2% for 2025, 2.2% for 2026, and 2.2% for 2027.
The goal of the structural deficit of the general goverment budget, according to the methodology of the European System of Accounts, is 0.82% of GDP in 2025, 0.75% in 2026, and 0.79% of GDP in 2027.
how will teh proposed increase in state debt affect the economy in the long term?
Interview with Budget Expert: Analyzing the Proposed State budget of 2025
Time.news Editor: Thank you for joining us today. With the Saeima’s examination of the 2025 state budget now underway, what are some of the most meaningful takeaways from the proposals submitted?
Budget expert: Thank you for having me. One of the highlights is the sheer volume of proposals being considered—311 for the main state budget alone.This indicates a robust legislative process aimed at addressing multiple priorities and stakeholders’ needs. Notably, we are observing a planned increase in budget revenues, projected to reach 15.081 billion euros, which is an increase of 583.2 million euros compared to 2024.
Time.news Editor: It seems that while revenues are increasing, expenses are rising even more steeply. How should we interpret this trend?
Budget Expert: Absolutely. The forecasted expenses for 2025 are expected to surpass revenues by 2.012 billion euros. this raises significant concerns regarding fiscal sustainability. With expenses hitting 17.093 billion euros—an increase of 876.5 million euros compared to the previous year—the government will need to be vigilant in monitoring its expenditures and ensuring they align with revenue growth.
Time.news Editor: You mentioned a fiscal prioritization. With internal and external security highlighted as a key focus, how dose this influence budget allocations?
budget Expert: Security often takes precedence in national budgeting, reflecting public demand for safety and stability. This might lead to increased allocations in areas like defense and law enforcement,which,while crucial,can divert funds from other essential sectors such as education or healthcare. On the one hand, prioritizing security can foster stability; on the other hand, it necessitates a balanced approach to avoid compromising other critical services.
Time.news Editor: One point that caught our attention was the proposed maximum state debt ceiling of 21 billion euros. What implications does this have for the contry’s economic landscape?
Budget Expert: Setting a debt ceiling can provide a framework for financial discipline; however, it also reflects on the state’s capacity to sustain higher debt levels. The planned debt-to-GDP ratio of 47.3% may seem manageable, but as we project GDP growth at only 2.2% annually, the government must enact robust strategies to stimulate growth to maintain this balance.
Time.news Editor: And what are the implications of the structural deficit targets outlined in the budget?
Budget Expert: The structural deficit targets are essential for maintaining fiscal health. Aiming for 0.82% of GDP in 2025 signals a commitment towards sound fiscal management, ultimately aiming to enhance the nation’s creditworthiness and economic resilience. Though, achieving these targets requires careful monitoring and adjustment of policies to adapt to changing economic conditions.
Time.news Editor: For readers who may be tracking this legislative process, what practical advice can you offer as the budget nears its final reading?
Budget Expert: It’s critical for citizens to stay informed and engaged. Understanding how budget decisions impact local services, economic growth, and national priorities allows for a more nuanced discussion surrounding these decisions. Additionally, advocating for openness and accountability in budget implementation will empower the public to ensure that funds are used effectively.
Time.news Editor: Thank you for these valuable insights on the 2025 state budget proposal. It’s clear that though challenges lie ahead, there are opportunities for constructive dialog and proactive fiscal management.
Budget Expert: Thank you for having me. I hope this discussion encourages greater public engagement in budget matters moving forward.