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Latvia’s Saeima approves 2019 budget and rejects all proposals from opposition

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUOn Wednesday, 3 April, Latvia’s Saeima approved the country’s budget for 2019 and denied all proposals submitted to the budget law by members of the opposition.

59 members of the Saeima voted in favour of the budget and 34 voted against. The budget received support from deputies of the coalition. The opposition, including KPV LV party’s internal opposition members Linda Liepiņa, Karina Sprūde and Didzis Šmits, voted against the budget law. Janīna Jalinska from the Union of Greens and Farmers did not participate in the vote.

The discussions regarding the budget and fourteen associated legislative drafts lasted the whole day – Saeima meeting lasted for ten hours with breaks.

In his speech to the Saeima, Latvia’s Prime Minister Krišjānis Kariņš said this is a technical budget that was largely compiled by the previous government. He thanked Saeima deputies for their work, stressing how they care about the country’s development – opposition and coalition alike.

On Thursday, 4 March, politicians will start working on the 2020 budget draft. Already there are many desires. However, the budget’s ability to satisfy all of them is limited. Kariņš urged Saeima deputies to think in a longer term perspective because development is a gradual process. This is why politicians should put the correct foundation to assist with development and residents’ welfare, said the prime minister.

Politicians of Latvia’s ruling coalition had previously said that this would be a technical budget, stressing that because of this reason requests for additional funding would be rejected.

However, after looking at proposals for the budget, the Saeima did support several requests for funding division. Parliamentarians supported proposals for diverting EUR 5.5 million from Latvijas Loto dividends and Bank of Latvia profits to help increase wages for teachers after completion of reforms.

Deputies also agreed to divert EUR 169,952 for the Central Election Commission to ensure equal rights for voters to vote at any election site. These funds will be diverted from the money saved by Office of Citizenship and Migration Affairs.

Saeima members also agreed to divide funding of EUR 450,000 to finance Family-friendly municipality programme.

The parliament also supported the proposal to divide EUR 213,500 for the Paralympic Sports Centre. This money was initially intended for Ventspils Olympic Centre. Additionally, funding of EUR 1.33 million will be allocated from Ventspils Olympic Centre to finance construction of Rezekne Olympic Centre.

Saeima deputies also supported the proposal to divert no more than EUR 740,000 for Education and Science Ministry to secure funding for innovative study programmes in ICT field.

Consolidated budget revenue for 2019 state budget is planned at EUR 9.2 billion. Expenditures are planned EUR 9.4 billion. Planned revenue of the base budget is around EUR 6.4 billion, whereas expenditures are planned at EUR 6.8 billion. Revenue of the special budget is planned at EUR 3 billion, whereas expenditures are planned at EUR 2.8 billion.

General budget deficit is planned at 0.5% of GDP for 2019. GDP growth, on the other hand, is planned at 3% for 2019.

The 2019 state budget has been coordinated with the European Commission. It meets fiscal discipline requirements and ensures stable funding for many industries, Saeima deputies say.

This year’s budget was formed with slight corrections, fulfilling previously initiated activities and without adding any new initiatives. However, after reviewing base expenditures, additional funding is planned to be allocated for multiple planned activities, government representatives said.

EUR 7.2 million is planned to be diverted to increase measures against money laundering and terrorism financing. This money will be used to enhance capacity of market supervisory institutions.

State defence funding is planned at 2% of GDP. To ensure this, it is planned to divert additional funding of EUR 60.3 million.

An additional amount of EUR 3 million is planned to be allocated to finance public media, Ombudsman’s Bureau, State Audit and other independent institutions.

EUR 41.3 million is planned to finance allowances for every five years of retirement for people employed in the internal affairs sector, and EUR 8.9 million to increase wages for judges and prosecutors in accordance with the ruling of the Constitutional Court.

An additional amount of EUR 87.5 million will be allocated to increase the smallest wages of healthcare workers.

EUR 10.4 million is planned to be diverted for pension indexation and paying allowances to pensioners whose spouse has died. EUR 5.4 million is planned to be used to cover costs from the Maintenance Guarantee Fund.

Another EUR 2.7 million is planned to increase childcare benefits and allowances for invalids starting from 1 July. EUR 1 million will be used to implement adoption allowance and EUR 4.8 million – to increase wages of social care centre workers.

To continue publication of documents from the former LSSR KGB, it is planned to allocate EUR 168,000. EUR 400,000 will be allocated to finance participation of Latvian Olympic and Paralympic athletes in the 2020 Olympic Games in Tokyo.

To reduce grey economy, it is planned to perform a number of activities to limit unlicensed gambling and lotteries, reduce use of cash in real estate deals, as well as adopt advance payments for commercial transports using light-weight vehicles. It is also planned to perform measures to limit grey economy in healthcare, as well as catering and accommodation, passenger transports and security service sector.

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