Banks, Budget, Financial Services, Legislation, Lithuania

Under the rule, the annual growth of state budget appropriations in 2015 cannot exceed 0.5%. However, the most important financial document provides for a much bigger growth of budget appropriations next year compared to 2014 - a 4.8% growth.

"In our opinion, the Law of Fiscal Discipline has been breached in terms of spending," said Vitas Vasiliauskas, governor of the Bank of Lithuania during a sitting of the Seimas Committee on Budget and Finance on Wednesday.

However, Finance Minister Rimantas Sadzius disagrees with the Bank of Lithuania's conclusion. He claims that the draft budget formally meets the fiscal discipline provisions.

According to Prime Minister Algirdas Butkevicius, Lithuania can expect a balanced budget in 2017. Following the Bank of Lithuania's conclusion, Seimas opposition leader Andrius Kubilius has urged the Government to take back the submitted draft budget because, to put it in his own words, "if the budget is approved after this conclusion confidence in Lithuania on international markets might be undermined which in turn would result in higher borrowing cost".