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Monday 19.08.2019 | Name days: Melānija, Imanta

Lithuania's next President set to take bull by horns in tackling poverty

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU

Linas Jegelevičius for the BNN

Lithuania’s president-elect Gitanas Nausėda has touched one issue – social exclusion and high level of income inequality in Lithuanian society – a lot more than all the others. But can Nausėda, economist by profession, blur the gaping gap between the rich and the poor? Can he find a common ground with the ruling coalition in tackling poverty?

BNN spoke to a number of Lithuanian analysts observing every move of the new state-of-head.

Employers’ representative praises president-elect’s approach

Speaking this past Wednesday, Nausėda once again accentuated risks stemming from poverty:

«The issue of social exclusion is becoming a matter of the state’s integrity or social peace. If we do nothing in this area, we will not only lose people to emigration but will also have a difficult social climate.»

Speaking to BNN, Danas Arlauskas, director of Lithuania’s Employer Confederation, noted that Nausėda’s emphasis of acute social problems, such as social exclusion and income inequality, is «very timely». «They pose extremely big challenges for us, employers. We see an ongoing marginalization of our society, when some can afford affluent lifestyles and the others live from hand to mouth. It breeds populism and destabilises the state’s life,» Arlauskas underscored. «What we have been proposing for many years is to remove the bureaucratic constraints crippling commencement of small businesses. Our public sector is ballooned and is often inefficient.»

Nausėda in contrast with his predecessor

Kęstutis Girnius, a Lithuanian political analyst of US descent, observed to BNN that Nausėda has already paid a lot of his attention to acute social issues. «He seems to genuinely understand that the issues, if unsolved, can result in big problems for the country and the society. Nausėda has already come forward with some concrete proposals as far as income inequality is concerned. He has said that progressive tax system needs to be improved and that raising the existing rates or introducing new ones is not enough. His rhetoric on the issues is in stark contrast with that of outgoing president Dalia Grybauskaite who has not just done very little in fighting poverty, but also spoke very little about them,» Girnius told BNN.

Addressing the government’s policies this week, Nausėda warned that the government’s plans to raise the non-taxable income rate fast can undermine the implementation of social policy goals, thence, the planned pace should be slowed. «It might happen so that we might need to choose whether to implement these measures that are planned on child benefits and other things, and perhaps when also considering the non-taxable income rate, not necessarily to halt but to slow the increase, or we just leave the tax reform situation the way it is and refrain from any more significant push in the social policy area,» the elected president said. Weighing in on outgoing president Dalia Grybauskaite’s State of the Nation Address delivered on Monday, June 10, Nausėda said he «missed attention» to social exclusion and education problems in the speech.

Ruling parties tend to please a new president

Asked if he believes that Nausėda can strike a common chord with the ruling party and the government on social issues, Girnius said that every incoming president is in a good position to start things from a blank page.

«Just because the ruling parties want to please the president-elect, they understand that they have to accept the will of the nation, therefore they, as a rule, are cooperative rather than disruptive with the new leader.

Importantly, the ruling LFGU did emphasise necessity to tackle social exclusion and poverty, so both Nausėda and the ruling parties are likely to find themselves being on the same page when addressing the issues. With the backing of Nausėda the ruling parties can surely do a whole lot more,» the analyst said.

According to Girnius, joining Nausėda in the fight against poverty could boost the ruling parties’ ratings ahead of Seimas election next year. «With just 16 months remaining till the election, the LFGU will certainly put more emphasis on its social agenda,» Girnius concluded.

Analyst misses concrete proposals

Vytautas Bruveris, an analyst and journalist of daily Lietuvos rytas, also notes that the president-elect does heed the country’s current socio-economic situation. «But I miss concrete proposals what specifically has to be done tackling poverty in the country. His rhetoric is more about stating the situation, rather than addressing it with concrete measures. But, again, it is too premature to expect a detailed plan (from him). He will definitely unveil more details in coping with social issues when he is inaugurated and introduces his team,» Bruveris told BNN.

Likewise Girnius, Bruveris expects that the ruling LFGU coalition, which is likely to be expanded in the weeks to come, will address the new president’s concerns in the government’s programme for year of 2020, envisioning more allocations for social issues. «I am optimistic that relations between Nausėda and the ruling party and the government will be better than the latter two had with Grybauskaite,» Bruveris emphasised.

Every president has substantial powers to fight poverty

Lauras Bielinis, professor of Kaunas Vytautas Magnus University, paid attention to the fact that the president-elect not only singled out a set of (social) issues from scratch of his presidency, but vowed to set up an expanded working group to address them. «This is very important. Every president has powers to do a lot in solving social issues, which now exacerbate in Lithuania. Moreover: the population sees president as one who cares most about ordinary people. Nausėda definitely understands that and will do all he can not to disappoint the people,» Bielinis told BNN.

To the question if Nausėda can work fruitfully with the current coalition, he replied that it seems that the president-elect is «ready» to work with it, but it the «whole situation” is pretty «shaky» with the ruling LFGU reeling off from the worse than expected performance in the municipal council, presidential and EP elections. In addition, the coalition expansion attempts did not produce tangible results yet. «Provided that the coalition stays after Nausėda inauguration, social issues will be on the new president’s table from day one. Especially that he wants to have an expanded qualified team dealing with them. The coalition will be impelled to work with the president’s office on the issues. Besides, tackling them ahead of the parliamentary elections is also in favour of the ruling parties’ interests too,» Bielinis noted.

Outgoing MEP: a clear picture will emerge after inauguration

Petras Auštrevičius, an outgoing Lithuanian MEP, also observes Nausėda’s striving to address acute social issues. «I am pretty sure he will be much more proactive in the regard than his predecessor, Grybauskaite. But we will see a clearer picture how he will do it when he assembles his team and outlines his policies after inauguration,» Auštrevičius said. He doubted if the president-elect and the ruling LFGU-led coalition will find a common ground on most of the issues.

«We might see some splurging of budgetary resources ahead of the parliamentary election – I mean the ruling bloc is likely to try to please the voters by raising the minimum wage and allowances, but Nausėda will have to push the brakes at some point,» he emphasised.

The ruling Farmers and Greens (LFGU) has committed this week to further raise child benefit payouts. The European Commission has recently named Lithuania among the EU member states with the highest income inequality in the bloc.

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