As the Saeima prepares the state budget for a second reading, there will certainly be new proposals to use funds more efficiently, predicted Saeima Budget Committee Chair Anda Čakša (New Unity) in an interview on TV3’s 900 Seconds.
Čakša said savings could be found to either meet other needs—such as health care or education—or to reduce public debt. The committee has been seriously reviewing ministries’ base budgets, rather than starting with new initiatives as in previous years, she noted. She praised ministries for their work, though some required more reminders.
On public debt, Čakša argued it matters what borrowed money is used for. In her view, increased borrowing was unavoidable. The committee is convinced, for example, that defence needs funding—and quickly. At the same time, she would like the budget to place a stronger emphasis on promoting economic growth: “That is the part we will need to work on more and more intensively in the long term.”
Čakša said politicians are keen to pass the budget, and her committee is working with a clear goal: to approve it.
Today the Saeima begins examining next year’s state budget and its accompanying package of bills
at an extraordinary sitting. Last week, the Budget and Finance (Tax) Committee finished work on the draft law “On the State Budget for 2026 and the Budget Framework for 2026–2028”, as well as nearly 50 accompanying bills—including changes to certain taxes and reforms to the service-pension system.
Among them, MPs must decide on government-proposed amendments to the Excise Duty Law, which would gradually raise excise taxes next year on several product groups, including alcoholic beverages, tobacco products, non-alcoholic and energy drinks. In two years’ time, the reduced excise rate for oil products used in free ports and special economic zones would be abolished.
From the 15th of March next year, excise on strong alcohol will rise, adding about 0.27 euros to a 0.5-litre bottle. From the 1st of March 2028, excise will increase for all alcoholic beverages, lifting the final price of strong alcohol by 0.51 euros, wine by 0.15–0.30 euros, and beer by 0.03 euros per bottle.
For tobacco, faster-than-planned increases are set for next year and from 2027—5% higher than previously scheduled.
Compared with today’s prices, by 2028 a pack of cigarettes would rise by 2.20 euros to 7.50 euros; heated tobacco would rise 0.35 euros per pack; a 2 ml e-liquid pack would rise 0.15 euros.
From 2028, tax increases are planned for sugary drinks, and a separate rate will be set for energy drinks. Also from 2028, on-site prepared carbonated soft drinks in catering establishments will be subject to excise (previously, on-site prepared drinks for immediate consumption were untaxed).
Excise changes will also affect oil products: from 2028 the reduced rate in free ports and SEZs will be removed; to encourage cleaner energy use in equipment and machinery (including electricity), the general excise rate would apply instead. Existing fuel reliefs may be used until end-2027.
Amendments to the State Social Benefits Law would pay the childcare benefit until 1.5 years of age
(instead of 2), while raising it from 171 euros to 298 euros per month for children up to 18 months. For children born by the 2nd of November next year, the benefit would continue until age 2.
Changes will also affect the family state benefit for school-age children: it could be paid for 16–20-year-olds also if the child studies full-time in college or university and is unmarried—thus restoring payments for families with students up to 20. Currently it is paid for those in secondary or vocational schools.
The one-time childbirth allowance will increase next year to 600 euros (from 421.17 euros). The guardian’s maintenance allowance rises to 390 euros/month for children under 7 (from 215 euros), and 468 euros/month for ages 7–18 (from 258 euros).
Remuneration for care of an adoptable child is planned at 1,041 euros/month from 2026 (70% of the national average contributory wage). If granted in 2025 and continuing into 2026, the amount would be up to 956 euros/month. (Currently, the minimum is 171 euros/month.) The guardian’s duty allowance will also increase to 298 euros/month (from 54.07 euros) next year.
Amendments to the social insurance law would grant non-working guardians social protections:
the state budget would pay mandatory contributions for pensions, unemployment and disability insurance.
The adoption benefit will also rise next year: 195 euros/month for a child under 7 (from 107.5 euros), and 234 euros/month for ages 7–18 (from 129 euros). The one-time adoption payment would increase from 1,422.87 euros to 2,433 euros.
Amendments to the Maternity and Sickness Insurance Law would keep the parental benefit for working parents at 75% next year.
To improve material support for families, 42 million euros in additional funding is planned next year, and 24.1 million euros for measures supporting children in out-of-family care.
The committee has also backed government amendments to numerous service-pension laws
(Interior Ministry system, military, prison service, diplomats, KNAB, NMPD participants, performing-arts institutions, and the Military Service Law), introducing gradual changes to the current framework.
Čakša argued the rules now differ widely by sector, creating inequities and rising costs. The reforms would narrow gaps between service-pension recipients and the general public and create a fairer system, phasing in from 2027 with unified principles and a transparent financing model, while maintaining social protection for roles with special risk or public-safety responsibilities.
Over five years, service time and age thresholds would rise by six months per year; the last two months would be excluded from the pension base. For those with under 10 years’ service as of the 1st of January, 2027, the formula would change, using pay over the last 10 calendar years, ending two months before discharge. Minimum and maximum service-pension amounts would be reduced by 10–20%, and by 5% where a person is discharged or removed from office. Prosecutors and judges would be excluded (moving to a special pension), as would diplomats. Service pensions would be discontinued for ballet, circus and choir artists, puppeteers, orchestra musicians, vocal soloists and theatre actors; support for re-qualification is planned. Service pensions would no longer cover roles without regular health or life risks, including support functions. Up to 20% of private-sector time could count toward service time.
Service pensions would be paid only until the general retirement age,
after which the person would receive a regular old-age pension under general rules.
Current recipients and those already eligible at entry into force would not be affected.
The overhaul is also driven by a rapidly rising fiscal burden: in five years, annual state budget spending on these pensions is expected to exceed 200 million euros, according to the bill annotations.
Before debating next year’s budget package, the committee heard ministries on 2026 spending to identify possible savings.
The government on the 14th of October approved the 2026 state budget: consolidated revenues 16.064bn euros, expenditures 17.945bn euros. Versus 2025, revenues rise by 944.6m euros, expenditures by 804.3m euros. The basic budget: revenues 10.9bn euros, expenditures 13.2bn euros. The special budget: revenues 5.5bn euros, expenditures 5.1bn euros. GDP next year is projected at 43.953bn euros (current prices), implying a 3.3% budget deficit; public debt will remain below 55% of GDP. General-government spending will decline to 47% of GDP (from 47.5% this year), with defence spending increasing. Overall spending is reduced by 171m euros next year. Priority measures total 693.5m euros, including 448.3m euros for defence and security.
The Finance Ministry says the 2026 budget and 2026–2028 framework comply with EU and national fiscal-discipline rules. The budget provides additional investments in national security, family support and quality education, over 1 billion euros in EU-fund investments, and a 151.4m euros increase in municipal revenues.
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