Kulbergs aims for 909,000 workers and €2.875 billion in savings by 2030

Latvian Prime Minister Kulbergs on Tuesday presented, at a press conference, his proposal for consolidating the state budget and boosting economic growth. The plan envisages saving €2.875 billion in the budget over four years, from 2027 to 2030, and increasing employment to 909,000 people by 2030. That would be 26,000 more workers than in 2025. The prime minister said the goal is to restore the financial situation the country had in 2018, when real growth was 4%.

More people at work

Kulbergs estimates that with 909,000 people working, the state would collect roughly €290 million more in taxes each year. He would look for additional workers in several groups. About 28,000 young people who are neither working nor studying could be encouraged with a reduced personal income tax rate during their first three years of employment. Around 15,000 young mothers on childcare leave could be allowed to work part-time without losing parental benefit. For seniors, the plan foresees lower employer social contributions and flexible hours, while 3,000–6,000 public sector employees could move to the private sector.

Savings

Planned savings by year are €822 million in 2027, €667 million in 2028, €675 million in 2029 and €711 million in 2030. Calculations show that, for medium and severe cases, such savings would affect 49% of society. Savings are to come from six areas:

• public administration – about €900 million (fewer posts, centralised procurement, shared administrative services);
• sectoral reforms – about €650 million (administration of sick leave and benefits, a hospital cooperation network);
• capital, revenue and one-off measures – €540 million (including a fixed income tax-free minimum and use of state companies' spare funds);
• stronger rules and administrative discipline – €370 million;
• review of targeted support measures – about €190 million;
• limiting automatic spending drivers – €40 million.

The prime minister repeatedly criticised previous governments, stressing that the state's true financial situation had been concealed from the public. Asked about cooperation with the party New Unity, he did not answer directly, saying only that he is ready to work with those prepared to carry out the necessary changes, including unpopular decisions.

Finance Ministry forecasts

The Finance Ministry forecasts that gross domestic product will grow by 2.4% this year and 1.9% next year. Under unchanged policy, fiscal space in 2027 will be negative at €117.7 million, and the budget deficit would reach 4.2% of GDP that year. The average gross monthly wage is forecast at €1,906 next year, and unemployment at 6.8%.