Latvia's energy aid will not target those most at risk, says expert

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Those targeted by state aid in the energy price crisis are not necessarily most at risk, economic anthropologist Andris Šuvajevs told Latvian Radio January 25 referring to data from the Central Statistical Bureau.

Šuvajevs said that aid is targeted at seniors and families with children but those most at risk are single-person households and households with one adult with dependent children.

He said: “We see the greatest risk of poverty for single-person households regardless of age. The next big risk group is one adult with dependent children, which is also intuitively logical that paying bills for one is a more difficult task than two adults.”

“It's certainly hard to target [aid measures] at households with only one person. This kind of knowledge is probably not in the possession of the State or the municipalities. This further raises doubts that this kind of targeting policy is in any way effective and will indeed provide the necessary additional support to those groups of the public most at risk,” he added.

As another problem Šuvajevs pointed out that no one knows how the channeling of €250 million aid would affect different types of households. “I think a good policy would be the ability of the government to say now how different types of households will feel this support. It would also lead to the conclusion that these €50 for each child and €20 for each pensioner and person with disabilities may be applicable and legitimate,” he said.

Šuvajevs said that it would be more appropriate to reduce the value-added tax in that the households would be able to estimate the benefits clearer. 

"I also find it worth pointing out that one of the missing aid measures is any kind of consideration for the deletion of utility debts. Until now, most households have sought to pay their bills, but if this tense situation continues in the coming months, a large proportion of households will be forced to accumulate debts. In this case, it would be worth starting to think about initiatives that would provide for debt redemptions, because we do not have a clearly defined balance on the costs that the state and the households will take on."

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