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Ministries demand additional EUR 1.1 billion in next year’s budget

RIGA – Despite the predicted negative fiscal space, ministries are demanding additional EUR 1.1 billion for their priority measures in the 2019 budget, according to the information at the disposal of the Finance Ministry.

The ministry said though that the information might have some technical inaccuracies, and some ministries might have already found resources in their own funds for some of the measures.

Last year ministries required additional EUR 760 million in the 2018 budget for priority measures. In April this year, the Finance Ministry announced that base expenditure in 2019 budget has been estimated at EUR 6.73 billion or by EUR 75.5 million more than provided in the budget framework law for 2019.

According to the Finance Ministry’s data, the Health Ministry has required additional EUR 431.39 million, the Transport Ministry need EUR 136.2 million, the Education and Science Ministry needs EUR 106.3 million, the Interior Ministry needs additional EUR 103.15 million, the Welfare Ministry needs EUR 69.27 million, and the Economics Ministry needs EUR 40.29 million.

The Justice Ministry wants additional EUR 54.57 million in next year’s budget, the Agricultural Ministry needs EUR 26.8 million, the Environment Protection and Regional Development Ministry needs EUR 25.65 million, and the Culture Ministry needs EUR 17.05 million. Also. The Foreign Ministry demands additional EUR 12.84 million, and the Finance Ministry needs EUR 11.35 million. The Defense Ministry has not demanded any additional allocations in the 2019 budget.

According to the Finance Ministry’s data, ministries have demanded additional EUR 1.4 billion in the 2020 budget, and additional EUR 1.8 billion in 2021.

According to Latvia’s Stability Program for 2018-2021, the fiscal space which is calculated so that additional financing can be allocated to prioritized activities in Latvia's medium-term budget and to finance urgent needs is planned at minus EUR 45.2 million for 2019 and minus EUR 37.8 million for 2020, based on the current forecasts. However, a positive fiscal space of EUR 3.2 million is being projected for 2021.

Latvian Prime Minister Maris Kucinskis (Greens/Farmers) told the press in April that the situation with the fiscal space may be adjusted during the actual budget formation process. He said that the three-year budget framework had been adopted earlier and the fiscal space currently being discussed is what was projected in fall last year but the situation with the fiscal space might change with the drafting of the 2019 budget.

Ministries by August 1 had to submit their proposals for priority measures and necessary financing.

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