This was stated at Monday’s meeting in Brussels where the euro area’s finance ministers discussed the member states’ draft budgetary plans for 2017 based on the European Commission‘s opinions on these plans published on November 16, the Lithuanian Finance Ministry said.
The Eurogroup said in a statement that they agree with the Commission’s assessment that there is a risk of Lithuania’s non-compliance with the requirements of the Stability and Growth Pact (SGP), but noted that the implementation of the social model reform would reduce that risk.
The finance ministers also called on Lithuania’s new government to submit an updated draft budgetary plan as soon as possible.
Lithuania has applied for use of the structural reform clause in the SGP as it plans to implement the new social model, whose costs are currently estimated at 243 million euros, accounting for 0.6 percent of next year’s projected GDP.
The Lithuanian Peasant and Green Union, the party that won the recent parliamentary elections, proposes to delay the implementation of certain laws of the social model package, including the new Labour Code, which would allow saving around 80 million euros in budget funds.