The Lithuanian government is expected to consider a proposal to require all ministries, except the Defence Ministry, their agencies and budget appropriation managers to cut spending by 5 percent in 2026 through 2028.
According to Finance Ministry estimates available to BNS, the savings target for 2026 alone would amount to 137 million euros.
The Finance Ministry projects that next year, spending by all ministries (except the Defence Ministry) will total 15.308 billion euros. Of that, 137.4 million euros are expected to be saved.
The estimated saving targets are 10.4 million euros (out of a projected 207.6 million euros) for the Environment Ministry, 9.5 million euros (189.6 million euros) for the Economy and Innovation Ministry, 1.2 million euros (23.6 million euros) for the Energy Ministry, 2.4 million euros (1.88 billion euros) for the Finance Ministry and its associated appropriation managers, 14.5 million euros (289.1 million euros) for the Culture Ministry, and 15.3 million euros (6.83 billion euros) for the Social Security and Labour Ministry.
The Health Ministry and its associated appropriation managers would be required to save 15.5 million euros (1.49 billion euros); the Transport Ministry, 5.6 million euros (604.9 million euros); the Education, Science and Sport Ministry, 15.2 million euros (2.53 billion euros); the Justice Ministry, 7.7 million euros (154.4 million euros); the Foreign Ministry, 7.6 million euros (162.1 million euros); the Interior Ministry, 14.1 million euros (776.4 million euros); and the Agriculture Ministry, 8.5 million euros (170.7 million euros).
Economy Minister Lukas Savickas told BNS that the state must lead by example in managing public finances efficiently, especially in light of the government’s proposed tax review. But he warned that this should not hold back economic growth.
“As we increase efficiency and reduce public sector funding, we cannot allow economic growth to stall. On the contrary, we need to aim to stimulate it,” Savickas said in a comment to BNS.
“The Economy and Innovation Ministry supports a review of funding for the public sector but stresses that economic stimulus measures must be maintained and expanded,” he added.
The savings target for next year represents 5 percent of the ministries’ projected 2026 operational expenses.
However, the calculations do not include social benefits, pensions, pension fund contributions, contributions for individuals insured by the state, mandatory health insurance fund contributions, or salaries for resident doctors.
No savings would be sought from funding for schools, teachers’ salaries, non-formal education and student funding packages, the Road Maintenance and Development Programme, defence-related spending by the Interior and Finance Ministries, officers’ salaries, membership fees for international organisations, debt management costs, or the government reserve.
Institutions would be given until May 2 to submit their projected funding needs and proposed savings for 2026–2028 to the Finance Ministry, using the zero-based budgeting method.
This method means ministries must calculate and justify the required funding “from scratch”, without reference to past budgets.
In March, the government approved the 2026–2028 budget planning schedule, which moves budget negotiations to the summer instead of the fall and tasks ministries with cutting spending to contribute to increased defence funding.
All ministries, except the Defence Ministry, were then instructed to review and apply zero-based budgeting to internal spending on administration, IT, and other goods and services, provided that the cuts do not negatively affect the public. Ministries must also propose cutting or scaling back lower-priority activities.
The Finance Ministry plans to update its 2025–2028 economic outlook and public finance projections by September 11 and submit the draft budget for 2026-2028 to the government by October 15.
Lithuania’s State Defence Council decided in January that the government need to increase military spending by 12–13 billion euros between 2026 and 2030. It would bring defence funding to 5–6 percent of GDP.
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