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Ceturtdiena 21.09.2017 | Name days: Matīss, Modris, Mariss

Minister: end of crisis and balanced economy are not the same thing

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Ilze Vinkele

Ilze Vinkele

The negative mood of Latvian residents compiled from different surveys shows that politicians have not explained clearly enough what exactly we have managed to achieve in recent years: i.e., that the end of the crisis is not the same thing as a balanced and developed economy, Welfare Minister Ilze Vinkele says.

“After a rapid economic drop in 2009, current economic development is progressing slowly. This is largely because, unlike the “pedal to the metal” policy of 2012, the budget is now being planned on the basis of long-term development. This is being done to avoid a situation when the state is unable to support residents that end up in difficult situations”, – the minister told BNN.

“The budget of 2014 will be the second one we will be able to plan on our own, without help from international creditors. There are more priorities in the post-crisis period than available funds. There are also problems the crisis had increased to a critical level in the last couple of years”, – she said.

According to her, additional money is still needed in the area of welfare, specifically social support of families, as well as the reorganization of state care centres and orphanages. “We should also keep in mind that teachers, medical personnel, state roads, police officers, as well as other people and values that form the future of our country also expect to receive support. According to estimates of the Finance Ministry, for every additional 1 Lat of next year’s budget there are needs worth 8 Lats. So it seems there will be tense discussions before we are able to agree on the priorities of the next year’s budget”, – the Welfare Minister says.

When speaking of improving the financial state of families, the minister emphasized that the proportion of families and children under the risk of poverty had rapidly reduced in 2012 (by 30%). The same goes for unemployment rate (by 2.5%). Birthrates slightly increased (by 3.6% in 2012 and by 11% at the beginning of 2013).

As it is known, measures are currently being carried out to increase state support for families with children. On top of that, different benefits are being increased and some restrictions are being cancelled – child care benefits for non-working parents were recently increased from 50 to 100 LVL for children under the age of one, while benefits for children of the age of 1 and 1.5 years were increased for all parents from 30 to 100 LVL. Minimum parental benefits for working parents were recently increased from 63 to 100 LVL.

PIT benefits for dependents were also increased, real estate tax was reduced in half for large families. This year, the state plans to allocate 100 LVL-large support for parents whose children were accepted in municipal pre-school education facilities (kindergartens).

“In regard to notable problems in the field of state support, it should be said that families that have children older than 1.5 years have notably smaller resources at their disposal – this increases poverty risks. Solving this problem is one of the main priorities of the Welfare Ministry”, – Vinkele says.


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