Social protection spending up sharply in 2021

Provisional data published by the Central Statistical Bureau of Latvia (CSB) on November 25 show that in 2021 Latvian social protection expenditure accounted for EUR 6 billion 440 million, which is EUR 1 billion 183.1 million or 22.5 % more than in 2020. 

The greatest increase in a year partially blighted by COVID-19 was observed in expenditure on social protection relating to sickness and healthcare (of 37.9 %), family and children (37.2 %), survivors (30.9 %), and housing (29.7 %).

Expenditure on health grew by 37.9 %, of which expenditure on outpatient care rose by 53.9 % reaching EUR 694.8 million. Due to the change in eligibility for benefit to people affected by COVID‑19 and under quarantine, expenditure on sickness benefit went up by 28.8 % reaching EUR 312.5 million.

The second greatest upturn in social protection expenditure (of 37.2 %) was observed in social protection for families and children. Aiming to mitigate negative impact of COVID-19 and ease strain on the financial means of families with children, in 2021 state made a one-off support payment (amounting to EUR 500 per child) to one of the parents or a caregiver. According to the State Social Insurance Agency, the support was provided to 375.9 thousand children, thus using EUR 187.9 million of the national budget.

In terms of the social protection expenditure share in GDP, Latvia takes the leading position among the Baltic states.

Expenditure on pensions and benefits (incl. administrative and other) took 19.1 % of the gross domestic product (GDP), which is 1.7 percentage points more than in 2020 (17.4 %). Comparison of the Baltic social protection expenditure (share of GDP) in 2020 and 20213 shows an increase of 1.8 percentage points in Latvia (from 17.1 % in 2020 to 18.9 % in 2021) and decrease of 1.6 percentage points (from 19.2 % to 17.6 %) and 2.1 percentage points (from 18.9 % to 16.8 %) in Lithuania and Estonia, respectively.

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Social protection expenditure in Latvia (million EUR annually)

 

2019

2020

2021

(provisional data)

Change in 2021, compared to 2020

(%)

million EUR

%

Total expenditure on social protection

4 774.5

5 256.9

6 440.0

100.0

22.5

sickness/health care

1 378.1

1 535.8

2 117.5

32.9

37.9

disability

401.4

424.1

508.0

7.9

19.8

old age

2 142.0

2 284.1

2 523.2

39.2

10.5

survivors

60.7

70.7

92.5

1.4

30.9

family/children

491.6

511.0

700.9

10.9

37.2

unemployment

188.2

308.7

351.7

5.5

13.9

housing

16.3

16.3

21.1

0.3

29.7

social exclusion

30.1

32.1

40.1

0.6

25.1

administrative costs (estimated)

64.9

73.0

83.9

1.3

14.9

other expenditure

1.3

1.2

1.0

0.0

-16.4

 

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