News Budget

On Tuesday, 26 September, the government endorsed an information report prepared by the Ministry of Finance on proposals for priority measures for the State budget of 2024 and the budgetary framework for 2024-2026. In the State budget of 2024, it was proposed to finance new government programmes and priorities in the amount of EUR 783.5 million in addition to existing government programmes. The government has also agreed upon three key national priorities – security, education and health, allocating thereto a total of EUR 486.6 million.

Out of the total allocation planned to be additionally granted in the next year’s State budget, EUR 114.4 million is intended for priorities and measures outside the fiscal space – one-off investments to support the civil population of Ukraine, promote global security, strengthen cybersecurity and build external border infrastructure.

In 2024, funds of EUR 148.4 million from the fiscal space are foreseen to implement additional measures. The non-tax revenue increase, planned tax changes, inter alia, by increasing remuneration for the employees of the public sector (departments of education, health, the interior), special budget expenditure correction and transfer of expenditure to the next programming period have also been used as the necessary financial resources. Resources are also provided by the updated investment plan of Rīgas satiksme and additional contributions to the State budget from the State capital companies, as well as resources from expenditure revisions, providing the necessary funding of EUR 520.7 million in total.

When preparing the budget proposal, the government allocated substantial funding to strengthening the internal and external security of the country. This essential item provides funding for an increase in the remuneration of the employees of the institutions of the Ministry of the Interior and the Ministry of Justice, for ensuring the country’s external security measures and for the establishment of external border infrastructure. Funds are also provided for strengthening cybersecurity, building life-saving capabilities of the structural units of the State Fire and Rescue Service and other measures. In 2027, it is planned to achieve the volume of funding for national defence in the amount of 3% of gross domestic product.

In the field of education, the most important issue is funding for the next step of implementing the schedule for the rise in teachers’ wages from 1 January 2024. Funding is also provided for a gradual shift to studies in the official State language as well as the acquisition of study aids and development of digital study aids. Additional funding is also intended for higher education and science, strengthening the field of STEM in educational institutions and other measures.

EUR 275 million is allocated for improving health care services and quality.

EUR 18 million is allocated for building capacity and ensuring the competitiveness of independent institutions, including public electronic mass media. It is planned to allocate more than EUR 17 million to the implementation of laws and regulations and enforcement of court judgments.

Almost EUR 176 million is planned for the implementation of priorities applied for by the sectors in 2024. For example, EUR 6 million is intended for the priority of the Ministry of Economics – innovation and export support. In turn, in the sector of agriculture, the most significant funding is planned to support the strengthening of the economic viability of agriculture and preventing the consequences caused by the crisis, as well as investment support for strengthening the competitiveness and export capacity of fruit and vegetable farms.

Significant funding in the amount of EUR 40 million is planned to be allocated to the Ministry of Transport for the development of the sector. EUR 19 million of this amount is intended for maintaining railway public infrastructure, and almost EUR 18 million is intended for a subsidy to cover public transport losses.

The supported sectoral priorities also include the measures of the Ministry of Welfare in the amount of EUR 32.6 million. Funds are intended for extending the circle of recipients of old-age and disability pension supplements and the amount thereof, support measures for families and children, and increasing the amount of remuneration of assistants and companions for people with disabilities.

It is planned to allocate EUR 50 million to the measures of the field of climate and energy for compensating the increase in electricity tariffs. The Ministry of Culture, in turn, plans to build the human resources capacity of the sector of culture.

It is also planned to ensure one-off targeted support to partially compensate borrowers for the sharp interest rate hike, allocating EUR 12 million thereto.