BNN ANALYSES | 2024 ushers in changes for state workers, pensioners, debtors and many others in Lithuania

Linas Jegelevičius
New Year is around the corner and 2024 ushers in a slew of novelties to be felt by most Lithuanians.
However, some sweeping changes, like the much-discussed tax reform or the introduction of universal real estate tax will not bruise Lithuanians in 2024 just because it is a big election year. 
Ahead of the EP, President and the new Parliament (Seimas) elections, the ruling Homeland Union – LCD decided not to vex voters with the adoption of the sensitive laws.
So long story short, in 2024, pensions for retirees, people with disability, for widows and orphans, the single person’s allowance will increase, the minimum wage will also go up, as well as the salaries of employees of budgetary institutions, but major taxes will remain intact.

From 2024 the minimum monthly wage (MMA) increases to 924 euros, i.e. 10 % from the current 840 euros.

The Ministry of Social Welfare and Labour (SADM) praises the increases, stating that “this is one of the most significant increases in MMA in the history of the country for three years in a row.”
The last time MMA rose the most was at the beginning of this year, when it increased by 110 euros “on paper” or 15 %.
From 2024 the minimum hourly wage will be 5.65 euros instead of the current 5.14 euros. The minimum hourly wage increases by 0.51 euros, or also about 10 %.
In order to increase the income of the lowest earners, the maximum amount of non-taxable income (NPD) will be increased up to 751 euros from 2024, a 20 % increase from the current level.
SADM says that, due to the increase of MMA and NPD, the income “in hands” of minimum wage earners will increase by 76 euros (or 12 %) next year. Lithuania’s Labor Code stipulates that MMA can be paid only for unskilled work.
According to Sodra, the country’s state welfare agency, the MMA increase will affect about 88 thousand workers, 10,000 of whom work in the country’s budgetary institutions.

As the reform of public sector continues,

from 2024, many budgetary employees will also see a pay increase due to the differentiation of official salary coefficients according to groups of budgetary institutions, professional or managerial work experience and et cetera.
As of the 1st of January, 2024, C-level position holders, like nursing assistants, firefighters, drivers, cooks will see the increase of 69 euros to their salaries, B-level budgetary workers, like accountants, storekeepers, secretaries will receive additional 65 euros, while A-level employees, including lawyers, accountants, librarians will see 80 euros added to their salaries; meanwhile salaries of deputy heads of budgetary institutions will rise by 257 euros, and those for heads of budgetary institutions, like cultural centers, sports centers, will increase by 610 euros.

In 2024, the average old-age pension in Lithuania will grow by approximately 66 euros and reach 605 euros.

SADM forecasts that the average old-age pension will comprise 45.9 % of the average wage “in hands”. In 2023, the average old-age pension increased from 483 euros to 539 euros, i.e. by 56 euros, and the average old-age pension with the required length of work experience went up from 513 to 574 euros.
Meanwhile, the single person’s benefit, known as the widow’s pension, will reach 38.23 euros a month in 2024.
Some significant changes, like the implementation of the state pension reform, may take effect from mid-2024 in Lithuania. The reform aims to significantly increase (by 72 euros, or 87 %) state pensions for former exiles and political prisoners. It will affect almost 48 thousand people in the country.
The reform also is set to determine the “floor” of state pensions for service for officers and soldiers. If the officers or soldiers have served the prescribed time for the pension, the “floor” will be 350 euros, and if they have served less, the size of it will decrease proportionally. It is predicted that the change will touch about 13.5 thousand people in Lithuania.

Those relying on social benefits will also see increases in their allowances from the start of 2024.

SADM says that the basic social benefit will reach 55 euros instead of 49 euros, the base of welfare pensions will be 197 euros instead of 184 euros, the base of targeted compensations will be 165 euros instead of 147 euros, the amount of state-supported income will be 176 euros instead of 157 euros.
Those who provide care for their illness-stricken family members also will benefit from the new law amendments in effect from 2024.
Amendments to the Sickness and Maternity Social Insurance Law extends the period of payment of sickness benefit when caring for family members, and also provide the opportunity to work part-time, receiving the minimum childcare benefit, when the childcare benefit is received and the salary received does not exceed the limit of five average salaries of the country.

Families with family members with a limited mobility or other life quality-affecting conditions also look eagerly forward.

From 2024 disability in Lithuania will be assessed according to a new model, when attention will be paid not only to the health condition, but also to the individual needs of people with disabilities or their relatives.
SADM says that one of the fundamental goals of disability reform is to “ensure that people with disabilities are not discriminated against, have equal rights and opportunities to participate in all areas of life with other members of society – not only in the labour market, but also in education, cultural activities, and public life.”
Therefore, when assessing disability from 2024, not only a person’s capabilities and abilities to perform certain actions will be taken into account, but also his needs and the help he needs, ensuring changes in both personal and social life. The level of work capacity will be changed by the new term – the level of participation. Until now, the level of work capacity was determined for a person with a disability, although the determined level of work capacity is only partially associated with the person’s ability to work.

Lithuanian children will not avoid changes in 2024 either.

As the National Education Agency has started implementing the project “Change of preschool education content”, which aims to update the content of preschool education, a child’s achievements and progress evaluation tool is envisioned for the second half of 2024. About 10 thousand children will participate in the programme.

Those burdened by debts will be able to sigh a relief in 2024, too.

Amended article 627 of Lithuania’s Civil Procedure Code embeds “borrower’s holiday”, meaning that the bailiff will have the right to suspend the enforcement case fully or partially or postpone enforcement actions for a debtor who has not worked under an employment contract or on the basis of a legal relationship equivalent to an employment relationship for the last six months.
Help during rainy days is good, but let’s hope 2024 brings just joy and happiness for all of us!
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