The Lithuanian Parliament rejected the president’s proposal to allow people to withdraw a quarter of their pension savings. However, a similar proposal will be considered in return. Politicians are, of course, inspired only by good motives – the desire for freedom and goodness. But freedom goes hand in hand with responsibility, which is valid every day and even more so in the long run.
For Slovakia, in particular, as the extremely strong generation of “Husák’s children”* does not have a sufficient population replacement and will start to put a major strain on the health and pension systems in the coming decades.
Today, the most worrisome problem is the pandemic and its management. The second problem is the effects of the pandemic on the economy and people. Other issues that seemed fundamental until recently, have been moved to the bottom of the agenda. But they did not disappear. One of those problems is population ageing. It continues, as it did before the pandemic, in Lithuania and all the Western world.
Some respected economists identified the issue of consolidation in public budget already in 2022 as a third-order problem. From an analytical point of view, he is, of course, right. A one-year deficit of 10% of GDP is nothing compared to a permanent two to five per cent deficit in the pension system with a declining workforce.