Leiputė says budget deficit could rise slightly above 3%

Lithuania’s government-sector deficit could exceed 3% of gross domestic product next year, but only slightly if needed to meet commitments, Social Democratic parliamentary group leader Orinta Leiputė said, LRT reported Wednesday.

Leiputė told Žinių radijas that fiscal discipline was important, but the government also had commitments to teachers, officials, nurses and others. Rising prices and planned spending meant those obligations had to be considered, she said. She did not specify how much the deficit might increase, saying figures would be discussed at an upcoming coalition council meeting.

Prime Minister Mindaugas Sinkevičius said Tuesday that next year’s deficit would probably exceed 3% of GDP. He warned that failing to curb rising spending could create fiscal discipline problems in the future.

President Gitanas Nausėda’s chief adviser, Vaidas Augustinavičius, said the president would accept a higher deficit given the challenge of balancing defence funding with social policy needs. Former finance minister Gintarė Skaistė, a Conservative, argued that justifying a higher deficit would encourage spending. She said the projected breach would be driven by planned social policy initiatives rather than increased defence spending.

Lithuania plans to allocate at least 5% of GDP to defence by 2030 to develop an army division and prepare to host a German brigade. The country’s public debt is forecast to reach about 45% of GDP in 2026, below the 60% limit set by the Maastricht criteria.