COMMISSION STAFF WORKING DOCUMENT Analysis of the recovery and resilience plan of Lithuania Accompanying the document Proposal for a COUNCIL IMPLEMENTING DECISION on the approval of the assessment of the recovery and resilience plan for Lithuania
Date: 2021-08-04
Institutions: European Commission, Secretariat-General
Subjects: EU aid, Lithuania, coronavirus disease, economic and social cohesion, economic recovery, economic reform, epidemic, investment, structural adjustment

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 4.8.2021  SWD(2021) 187 final/2  CORRIGENDUM  This document corrects document SWD(2021) 187 final of 02.07.2021.  Correction of minor clerical errors on pages 19, 24, 38, 62 and 77.  The text shall read as follows: COMMISSION STAFF WORKING DOCUMENT Analysis of the recovery and resilience plan of Lithuania Accompanying the document Proposal for a COUNCIL IMPLEMENTING DECISION on the approval of the assessment of the recovery and resilience plan for Lithuania {COM(2021) 386 final}  
 
 
Table of contents 
1.  Executive summary ................................................................................................................. 2 

2.  Recovery and resilience challenges: scene-setter .................................................................... 5 

2.1.  Macroeconomic outlook and developments since the 2020 country report ..................... 5 

2.2.  Challenges related to sustainable growth, cohesion, resilience and policies for the next 
generation .................................................................................................................................... 7 

2.3.  Challenges related to the twin transition ........................................................................ 10 

2.3.1.  Green dimension ..................................................................................................... 10 

2.3.2.  Digital dimension .................................................................................................... 13 

3.  Objectives, structure and governance of the plan .................................................................. 18 

3.1.  Overall strategy of the plan ............................................................................................ 18 

3.2. 

Implementation aspects of the plan ................................................................................ 22 

4.  Summary of the assessment of the plan................................................................................. 25 

4.1.  Comprehensive and adequately balanced response to the economic and social situation

25 

4.2.  Link with country-specific recommendations and the European Semester ................... 30 

4.3.  Growth potential, job creation, economic, institutional and social resilience, European 
Pillar of Social Rights, mitigating the impact of the crisis, and social territorial cohesion and 
convergence ............................................................................................................................... 39 

4.4.  The principle of ‘do no significant harm’ ...................................................................... 47 

4.5.  Green transition .............................................................................................................. 49 

4.6.  Digital transition ............................................................................................................. 52 

4.7.  Lasting impact of the plan .............................................................................................. 54 

4.8.  Milestones, targets, monitoring and implementation ..................................................... 57 

4.9.  Costing ........................................................................................................................... 59 

4.10.  Controls and audit .......................................................................................................... 60 

4.11.  Coherence ....................................................................................................................... 62 

5.  Annex..................................................................................................................................... 64 

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1.  EXECUTIVE SUMMARY  

Lithuania’s  economy  contracted  by  0.9%  in  2020,  significantly  less  than  the  EU  average, 
mainly thanks to the resilience of its exports. After the initial shock in the second quarter of 
2020,  the  economy  rebounded  strongly  during  the  rest  of  the  year.  While  the  lockdown 
introduced at the end of 2020 and extended into 2021 is set to weigh on the economy in the first 
half  of  the  year,  a  significant  easing  of  measures  in  the  second  half  of  2021  should  help  the 
economy  recover.  Economic  growth  is  expected  to  reach  2.9%  in  2021.  The  momentum  is 
expected  to  carry  into  2022,  with  GDP  growth  projected  to  reach  3.9%,  driven  by  dynamic 
developments in private consumption and investments.  

Despite  an  increase  in  unemployment  due  to  the  COVID  caused  restrictions,  wages 
continued to grow. In January 2021, the unemployment rate stood at 7.4%, higher than the rate 
of 6.2% one  year ago. According to the Commission’s Spring forecast, the unemployment rate 
should  remain  elevated  in  2021  before  decreasing  to  7.1%  in  2022.  Despite  a  jump  in 
unemployment,  wage  growth  remained  strong  in  2020,  with  wage  growth  in  the  public  sector 
outpacing the rest of the economy. The improving economic situation should continue to support 
further  increases  in  salaries  in  2021  and  2022.  Over  the  medium  term,  Lithuania’s  growth 
prospects will depend on productivity developments, especially what concerns labour force skills 
and innovation, and country’s ability to counter the pre-crisis trend of falling labour supply. Even 
though  preliminary  data  show  that  the  average  annual  population  in  Lithuania  grew  in  2020, 
interrupting  a  long-standing  decline,  preliminary  data  for  the  first  quarter  of  2021  suggest  that 
the outlook for net migration has turned slightly negative again.  

Government support to households and businesses was prompt to counteract the impact of 
the pandemic. At the outset of the crisis, Lithuania deployed support for businesses and people 
affected by the crisis as well as dedicated additional resources to the health sector. Subsidies and 
benefits, additional funding for healthcare and investment accounted for approximately 5.4% of 
GDP in 2020. As a result, the government deficit increased to 7.4% in 2020.  According to the 
Commission’s  Spring  forecast  2021  the  Lithuanian  general  government  deficit  is  expected  to 
reach 8.2% in 2021 before decreasing to 6.0% of GDP in 2022, as a result of a discontinuation of 
temporary support measures adopted in 2020 and 2021. According to the Stability Programme, 
additional spending to support the economy is expected to amount to approximately 3% of GDP 
in 2021. 

Lithuania’s plan consists of seven components, covering a broad range of policy areas and 
aims  to  address  the  country’s  key  challenges  with  a  balanced  set  of  reforms  and 
investments. Lithuania submitted its Recovery and Resilience plan on 14 May 2021. The seven 
components  are  “A  resilient  health  system  to  future  challenge”,  “Green  transformation  of 
Lithuania,  Digital  transformation  for  growth”,  “Quality  and  accessible  education  for  the  entire 
life-cycle”,  “Higher  education,  a  coherent  framework”,  “Efficient  public  sector  and 
preconditions to recover after the pandemic”, “More opportunities for everyone to actively build 
national  well-being”.  The  key  areas  for  investments  are  the  twin  transitions,  improved 
connectivity,  energy  efficiency,  health  infrastructure,  active  labour  market  measures  and 
education  infrastructure  as  well  as  research  and  innovation.  The  combined  reform  and 
investment effort will create synergies, making them more effective at achieving their intended 
policy  goals  and  helping  to  attract  further  private  investments.  Lithuania  has  requested  EUR 
2.225 billion in non-repayable support from the Recovery and Resilience Facility and no loans.  

2 

 
 
The plan is balanced in its response to the six policy pillars  referred to in Article 3 of the 
Regulation1. The policy pillars are addressed adequately through measures to: (i) strengthen the 
health and long-term care systems; (ii) reduce poverty; (iii) improve the quality of the education 
and  training  system;  (iv)  incentivise  innovation  and  support  entrepreneurship;  (v)  digitalise 
public services, make the public administration more efficient, improve the budgetary framework 
and tax compliance supporting the sustainability of public finances. 

The  plan  includes  adequate  measures  to  help  address  the  key  challenges  Lithuania  is 
facing. The challenges identified in the most recent Country-Specific recommendations pertain 
to five broad policy areas – fiscal, health, social inclusion, education, innovation and science, as 
well  as  the  twin  transitions.  Lithuania’s  plan  includes  an  extensive  set  of  mutually  reinforcing 
reforms and investments that contribute to effectively addressing all of the identified challenges 
to varying degrees, and overall proposes a balanced response to the challenges catalysed by the 
COVID-19 crisis. 

The  plan  proposes  reforms  in  taxation,  health,  social  inclusion,  education  and  skills, 
innovation and science and twin transitions which are expected to contribute to Lithuania’s 
economic  and  social  cohesion.  Social  cohesion  will  be  supported  by  key  reforms  relating  to 
health,  long-term  care,  improving  the  quality  of  early  childhood  and  school  education  and 
vocational training, the higher education funding system, improving the adequacy of the social 
safety  net,  changes  to  the  tax  system,  improving  tax  compliance,  improving  the  budgetary 
framework  and  the  public  administration.  These  reforms  will  be  accompanied  by  key 
investments which are expected to contribute to improving the school network and infrastructure, 
the lifelong learning system based on individual learning accounts, e-health, long-term care day 
centres,  creation  of  excellence  infrastructure  for  innovation,  renewable  energy,  sustainable 
mobility and building renovation.   

Investments in energy efficiency, in clean transport and in the circular economy as well as 
reforms  in  renewable  energy  are  expected  to  address  Lithuania’s  climate  challenges.  The 
plan  aims  at  moving  the  Lithuanian  economy  towards  attaining  its  energy  and  climate  targets. 
This  includes  measures  promoting  the  production  and  storage  of  renewable  energy;  reducing 
emissions  from  transport  by  replacing  polluting  vehicles  with  clean  vehicles;  accelerating  the 
renovation of buildings; and promoting the circular economy. These investments are expected to 
contribute  to  reaching  Lithuania’s  2030  and  2050  energy  and  climate  targets.  Together,  the 
measures  supporting  climate  change  objectives  in  Lithuania’s  plan  account  for  37.8%  of  the 
plan’s total allocation.  

In terms of the digital transition, key measures address the digital connectivity challenges, 
including the urban-rural digital divide, the digitalisation of the public and private sectors, 
and poor digital skills. The plan includes measures to further develop the rollout of very high 
capacity  networks,  including  5G  infrastructure  outside  urban  areas.  In  addition,  substantial 
reforms  and  investments  aim  to  digitalise  the  public  sector.  Investments  are  planned  in  digital 

1 Regulation  (EU) 2021/241 of the European Parliament and of the  Council of 12  February 2021 establishing the 
Recovery and Resilience Facility. 

3 

 
 
                                                           
skills for children, employees and senior citizens, while measures are also included to address the 
shortage of IT employees in the labour market. The measures with a digital impact account for 
31.5% of the Lithuanian plan total allocation. 

The justification Lithuania has provided on the amount of the estimated total costs of the 
recovery  and  resilience  plan,  is  broadly  reasonable  and  plausible.  Lithuania  has  provided 
individual  cost  estimates  for  all  investments  included  in  the  recovery  and  resilience  plan.  The 
cost  breakdown  is  generally  detailed  and  substantiated.  The  estimates  are  usually  based  on 
comparisons  with  past  investments  of  similar  nature  and  information  from  a  procurement 
database.  Lithuania  did  not  provide  an  independent  validation  for  the  cost  estimates  proposed. 
The assessment of the cost estimates and inherent supporting documents show that most of the 
costs are justified and reasonable to a medium  extent. The amounts proposed for financing are 
deemed  appropriate  and  are  seen  as  establishing  the  plausibility  of  the  cost  estimates  to  a 
medium extent. Finally, the estimated total cost of the recovery and resilience plan is in line with 
the  principle  of  cost-efficiency  and  is  commensurate  to  the  expected  national  economic  and 
social impact.   

The  individual  components  provide  clear  information  about  additional  investments  from 
other EU funds. Projects funded by other EU sources are demarcated in time and scope from the 
projects  in  the  RRP.  Furthermore,  Lithuania  has  put  in  place  adequate  and  sufficient 
arrangements to avoid double EU funding.   

Lithuania’s  recovery  and  resilience  plan  is  compliant  with  the  ‘do  no  significant  harm’ 
principle.  The  assessment  follows  the  methodology  set  out  in  the  Commission’s  Technical 
guidance  on  the  application  of  ‘do  no  significant  harm’  under  the  Recovery  and  Resilience 
Facility Regulation (2021/C 58/01) and the six corresponding environmental objectives. Where 
necessary,  respect  of  the  ‘do  no  significant  harm’  principle  is  ensured  by  milestones  for  the 
implementation of some measures.   

The  measures  envisaged  in  the  Lithuanian  recovery  and  resilience  plan  are  expected  to 
have a sizeable lasting impact on the economy and institutions. In particular, the envisaged 
reforms  and investments for the green and digital  transitions,  as well as measures in  education 
and training systems are expected to have a lasting impact on Lithuania’s economy, by fostering 
sustainable  long-term  growth  and  triggering  structural  changes  in  institutions  and  policies.  In 
addition,  the  envisaged  measures  in  higher  education  are  expected  to  improve  the  quality  of 
higher  education  programmes.  The  streamlining  of  the  state  innovation  policy  is  expected  to 
have a sizeable lasting impact  on diverse economic sectors in  Lithuania.  In addition,  measures 
supporting active labour market policies are expected to have a lasting impact on the functioning 
of the labour market, as well as on poverty reduction and income equality. The measures for the 
health sector are also expected to increase the efficiency of the healthcare system. Furthermore, 
reforms  to  modernise  the  public  sector  are  expected  to  trigger  long-lasting  impacts  on  the 
efficiency  of  the  public  sector,  including  analytical  and  technological  solutions  to  tackle  tax 
compliance issues. 

The arrangements proposed in the recovery and resilience plan ensure effective monitoring 
and implementation of the recovery and resilience plan, including the envisaged timetable, 
milestones  and  targets,  and  the  related  indicators.  The  Ministry  of  Finance  and  the  Central 
Project Management Agency shall be tasked with monitoring of the plan, whereas line ministries 
shall be responsible for its implementation. The milestones and targets are realistic and relevant, 

4 

 
 
but  the  distribution  of  milestones  and  targets  across  time  is  somewhat  uneven,  with  a 
backloading towards 2026. The control system and arrangements proposed in the recovery and 
resilience plan are based on the national processes and structures used for Cohesion Policy. The 
plan identifies actors (bodies/entities) and their roles and responsibilities for the performance of 
the internal control tasks. The relevant functions should be appropriately segregated. The control 
system  and  other  relevant  arrangements,  including  for  the  collection  and  making  available  of 
data on final recipients, are adequate. A dedicated IT-tool will be developed to meet the specific 
management  and  reporting  requirements  described  in  the  plan.  It  should  ensure  the  necessary 
audit trail as well as the reporting on milestones and targets.  

The  plan  is  coherent,  with  consistent,  mutually  reinforcing  reforms  and  investments,  and 
synergies  between  the  different  components.  The  plan  has  a  strategic  and  consistent  vision, 
displaying  coherence  within  each  component,  between  the  objectives  of  different  components 
and amidst individual reforms and investments in different components. The seven components 
are  coherent  in  their aims, structuring the investments  and reforms  and showing their thematic 
relation and interlinkages well. The components reinforce each other, in particular the green and 
digital transitions. 

 Table 1. Summary of the assessment of the Plan under the RRF criteria 

(1)   
Balanced 
Response   

(2)   
CSRs   

(3)   
Growth, 
jobs…   

(4)   
DNSH   

(5)   
Green 
target   

(6)   
Digital 
target   

(7)   
Lasting 
impact   

(8)   
M & T   

(9)   
Costing   

(10)   
Control 
Systems   

(11)   
Coherence   

 A  

A 

A 

A 

A 

A 

A 

A 

B  

A 

A 

2.  RECOVERY AND RESILIENCE CHALLENGES: SCENE-SETTER 

2.1. Macroeconomic outlook and developments since the 2020 country report  

Real GDP is expected to grow by 2.6% in 2021, and by 3.2% in in 2022 and 2023 according 
to  the  macroeconomic  scenario  published  by  the  Ministry  of  Finance  in  March  2021  and 
presented in Lithuania’s recovery and resilience plan. In 2020, real GDP contracted by 0.9%. 
The  scenario  assumes  that  a  pickup  in  domestic  demand  will  support  the  recovery  in  2021. 
However, it does not take into account investments to be funded from the RRF. Inflation based 
on  the  European  harmonised  index  of  consumer  prices  is  forecast  to  accelerate  from  1.1%  in 
2020 to 1.8% in 2021 and 2022, and to reach 2% in 2024. 

Lithuania’s  labour  market  deteriorated  in  2020.  The  unemployment  rate  increased  to  8.5% 
from  6.3%  in  2019,  while  the  number  of  employed  persons  decreased  by  1.5%  compared  to 
2019. In January 2021, the unemployment rate stood at 7.4%, higher than the rate of 6.2% one 
year ago. The macroeconomic scenario included in  the plan assumes  a gradual  recovery in  the 
labour market, with the unemployment rate decreasing from 8.5% in 2021 to 7.5% in 2022 and 
6.5% in 2024.   

Wages continued to increase strongly in 2020, by over 9%, despite the deterioration in the 
labour market. In the coming  years, wages growth is expected to slow down, but remain at a 
high level, with 5.2% in 2021, 4.5% in 2022 and 5.0% in 2023. 

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Income  inequality,  poverty  and  social  exclusion  are  persistent  challenges  in  Lithuania.  In 
2019, 26.3% of the population was at risk of poverty or social exclusion, and 9.4% was severely 
materially deprived - well above the EU averages of 20.9% and 5.5%, respectively. The income 
of the richest 20% was 6.44 times higher than the income of the poorest 20% in 2019, compared 
to 4.99 times for the EU as a whole. 

The general government deficit stood at 7.4% of GDP in 2020 and is expected to increase 
above  8%  in  2021.  According  to  the  RRP,  the discretionary  expenditure  measures  to  mitigate 
the negative consequences of the pandemic are expected to mount to 3.3% of GDP in 2021. The 
Plan envisages that the general government deficit will improve gradually over time. Due to an 
increase in deficits, the debt-to-GDP rate is expected to go from approximately 36% in 2019 to 
over 52% in 2021 and to continue increasing until just below 58% in 2024.  

The latest Commission forecast presents more positive projections than the macroeconomic 
scenario  underpinning  the  RRP.  According  to  the  Commission  2021  Spring  Forecast,  real 
GDP is set to grow by 2.9% and 3.9% in 2021 and 2022, respectively. The Commission projects 
a  stronger  recovery  in  domestic  demand,  including  due  to  investments  to  be  funded  by  the 
Recovery and Resilience Facility. The unemployment rate is projected to go down from 8.5% in 
2020 to 7.1% in 2022, which is slightly lower than according to the macro scenario underpinning 
the RRP.  Inflation projections are in line with the RRP scenario. Both the Commission and the 
RRP forecast similar deficit- and debt-to-GDP ratios in 2021 and 2022.  

Table 2. Comparison of macroeconomic developments and forecasts 

2019  

2020  

2021  

2022  

2023 

2024 

COM   COM  RRP   COM   RRP   COM   RRP   RRP   RRP  

4.3  

-0.9  

-0.8  

2.9  

2.6  

3.9  

3.2  

3.2  

3.2  

0.5  

-1.5  

-1.5  

0.4  

0.7  

0.8  

0.9  

-0.1  

-0.5  

6.3  

8.5  

8.5  

8.3  

8.5  

7.1  

7.5  

6.9  

6.5  

2.2  

1.1  

1.1  

1.9  

1.8  

1.9  

1.8  

1.9  

2.0  

0.5  

-7.4  

-7.4  

-8.2  

-8.1  

-6.0  

-6.0  

-4.0  

-2.2  

35.9  

47.3   47.3 

51.9  

52.1 

54.1 

54.2   57.9  

57.9 

Real GDP (% 
change)  

Employment (% 
change)  

Unemployment rate 
(%)  

HICP inflation (% 
change)  

General 
government balance 
(% of GDP)  

Gross debt ratio (% 
of GDP)  

Source: Commission Spring Forecast 2021 (COM); Recovery and resilience plan (RRP) 

The  difference  in  the  two  sets  of  forecasts  stems  mainly  from  the  cut-off  date  and 
assumptions  about  investments  to  be  funded  by  the  RRF.  The  Commission  forecast  was 

6 

 
 
 
   
prepared over a month later than the macroeconomic scenario underpinning the RRP. Therefore, 
the Commission  could  take into account  more recent  economic indicators, pointing to  a strong 
performance  in  the  first  quarter  of  2021.  In  addition,  the  Commission  took  into  account 
information  on  the  planned  RRF  investments,  presented  in  Lithuania's  2021  Stability 
Programme, submitted to the Commission on 30 April 2021.  

The  Plan  specifies  a  number  of  risks  for  the  macroeconomic  scenario.  The  main  risk  is 
linked  to  the  timing  of  when  the  pandemic  could  be  under  control.  Other  negative  risks  stem 
from  a  potential  escalation  of  the  geopolitical  situation,  developments  in  global  trade  and 
financial market tensions. On the upside, the economy may recover quicker than assumed in the 
scenario  if  the  vaccination  programme  proceeds  faster  than  expected.  The  macroeconomic  and 
fiscal outlook continue to be affected by high uncertainty related to the COVID-19 pandemic and 
its economic consequences. 

Overall, the RRP’s macroeconomic scenario is cautious. The economic scenario is identical to 
the one described in  the 2021 Stability Programme and has been developed by the Ministry of 
Finance.  The  macroeconomic  scenario  was  endorsed  by  Lithuania’s  Independent  Fiscal 
Institution which is part of the National Audit Office. 

2.2. Challenges  related  to  sustainable  growth,  cohesion,  resilience  and  policies  for  the 

next generation  

Smart, sustainable and inclusive growth, innovation and productivity 

Policies  are  needed  to  stimulate  productivity  growth  and  foster  a  sustainable  catch-up 
process.  Although  still well  below  the  EU  average,  productivity  levels  in  Lithuania  have  been 
catching up over the recent years. This can in large part be attributed to investments, leading to 
capital accumulation, rather than to technological change in general2.  

As  the  National  Productivity  Board  emphasises,  promoting  investments  in  skills,  technologies 
and equipment, as well as the involvement in strategic value chains in manufacturing, will play 
an important role in further boosting Lithuania’s productivity and growth potential. 

Skills, research and innovation capacities and overall R&I support need to be upgraded to 
support growth. A mismatch between the skills acquired by university graduates and the skills 
needed  by  businesses  is  holding  back  innovation  and  productivity  growth.  Furthermore, 
institutional  constraints,  such as preferential  tax treatment  of small companies, are limiting the 
growth  of  companies  and  restraining  innovation.  Limited  public  research  and  innovation 
capacities  with  moderate  quality  output  are  the  result  of  inefficient  public  funding  and  a 
cumbersome  institutional  structure.  R&D  intensity  is  relatively  low  and  spending  remains 
inefficient  and  overly  reliant  on  European  funds.  A  lack  of  effective  cooperation  between 
academia and the corporate sector further undermines R&I capabilities in the private sector. The 
large  number  of  agencies  responsible  for  a  plethora  of  innovation  support  schemes  makes  the 

2  European  Commission  (2021).  Productivity  and  competitiveness  developments  in  the  EU.  Joint  ECFIN-JRC 
Background and Policy Note. Internal Communication 

7 

 
 
                                                           
entire  R&I  support  system  difficult  to  access  and  use.  Consolidating  the  R&I  capabilities  of 
universities  and  ensuring  attractive  research  careers  and  synergies  between  R&I  and  higher 
education, are necessary to improve the quality of the public science base and its ability to play a 
role in the twin transition. 

Enterprises  are  not  growing  fast  in  Lithuania.  The  number  of  high  growth  enterprises  as  a 
percentage  of  the  total  number  of  enterprises  with  more  than  10  employees  in  most  sectors  is 
below  the  EU  average.  The  only  sector  which  performs  better  than  the  EU  average  is 
transportation  and  storage;  however,  even  in  this  sector,  a  large  number  of  enterprises  face 
COVID-19 related risks. The share of Lithuanian firms planning to grow as a result of increased 
digitisation  is  far  below  the  EU  average  (12%  vs  31%)  and  the  share  of  growth  firms  with  a 
strategy or action plan to digitalise in Lithuania is only 4% (EU-average is 22%)3. 

Social and territorial cohesion 

Ensuring that growth benefits all of society remains a challenge in Lithuania. Even though 
Lithuania has made some progress in recent years, income inequality and the risk of poverty and 
social  exclusion  remain  high,  especially  for  the  elderly  and  people  with  disabilities.  Public 
spending on social protection is relatively low and the capacity of social partners remain limited, 
restricting their effectiveness in collective bargaining and in delivering on the European Pillar of 
Social  Rights.  The  redistributive  capacity  of  the  tax-benefit  system  is  weakened  by  poor  tax 
compliance (see below), limited income tax progressivity, and low environmental, property and 
capital gains taxation. 

Social exclusion is amplified by a lack of access to social services and the low availability of 
social  housing.  The  organisation  and  delivery  of  social  services  is  fragmented  and  does  not 
ensure its effectiveness. There are around 10 000 people on the waiting lists for social housing, 
with  an  average  waiting  time  ranging  from  3  to  12  years  depending  on  the  municipality.  A 
comprehensive housing strategy is  not  yet  in  place and social  housing is  often of poor quality. 
There  is  a  significant  need  to  build  new  dwellings,  especially  for  big  families  and  disabled 
people, and to renovate existing dwellings.  

Regional  disparities  in  Lithuania  are  high  and  still  increasing.  As  the  main  source  of 
knowledge,  innovation  and  productivity,  the  Vilnius  region  generates  around  40%  of  the 
country’s GDP and has the highest level of income. The proportion of inhabitants in rural areas 
who are at risk of poverty and unemployment is consistently higher than in urban areas, while 
the  level  of  skills  and  school  outcomes  are  significantly  lower.  These  factors  have  a  negative 
impact on territorial cohesion and hinder investment and job creation in the rural areas. 

Health 

3 Benedetti Fasil, C, Domnick, C, Fako, P, Flachenecker, F., Gavigan, J. P., Janiri, M. L., del Rio, J-C, Stamenov, B. 
and Testa, G., High Growth Enterprises in the COVID-19 Crisis Context demographics, environmental innovations, 
digitalisation, finance and policy measures, JRC. Publications Office of the European Union, Luxembourg, 2021. 

8 

 
 
 
                                                           
Health outcomes in Lithuania persistently lag behind those in other EU countries. This is 
due  to  the  suboptimal  efficiency  and  quality  of  the  healthcare  system,  which  results  in  poor 
access to suitable healthcare. Lifestyle risk factors also play a significant role. The pandemic put 
additional  strain  on  the  limited  resources  of  the  health  system,  making  its  latent  structural 
problems more apparent and reaffirming the increasingly urgent need for reforms. Improving the 
resilience  of  the  health  system  and  making  long-term  care  more  accessible  and  affordable 
therefore remain key priorities.  

Tax compliance and budgetary framework 

Lithuania  continues  to  face  significant  challenges  with  tax  compliance.  It  has  one  of  the 
largest  VAT  gaps in the EU. Government  revenue administration activities such  as processing 
tax returns and revenue collection are distributed over a number of institutions, which leads to 
inefficiencies in the system.  

There are weaknesses in the budgetary framework. A large share of the central government 
expenditure is planned in an incremental way and is not subject to impartial expenditure reviews. 
The  budget  framework  reform,  which  is  intended  to  enhance  the  medium-term  financial 
planning,  is  experiencing  delays.  At  the  same  time,  there  are  no  clear  rules  for  when  the  state 
budget  must  be  amended.  In  2020,  the  budgets  were  not  amended  despite  a  notable  drop  in 
revenues  and  significant  spending  measures  taken  in  response  to  the  COVID-19  crisis.  The 
methodology  for  determining  the  revenues  available  for  municipalities  is  changed  every  year, 
which hinders investment planning.  

Policies for the next generation, children and youth, including education and skills  

The  pandemic  has  exacerbated  Lithuania’s  labour  market  challenges.  Despite  substantial 
wage  subsidies,  the  unemployment  rate  increased  during  the  second  wave  of  the  pandemic, 
mostly  impacting  youths,  those  with  lower  levels  of  education,  and  the  unskilled.  Targeted 
measures were introduced in the wake of the pandemic. However, the coverage of active labour 
market policies that support upskilling, reskilling and mobility has been overall decreasing. 

Skills  mismatches  are  holding  back  Lithuania’s  innovation  and productivity  growth.  The 
quality  of  tertiary  education  programmes  needs  improvements  and  could  be  achieved,  among 
other things, by consolidating tertiary institutions. Apprenticeships have been put  in  place, but 
they must be developed further. Participation in adult learning in Lithuania remains well below 
the EU average, with  very little improvement during the last decade. The general  population’s 
digital  skills  need  to  be  upgraded  to  facilitate  business  innovation  and  the  digital  transition. 
Lithuania needs to invest in implementing a comprehensive skills strategy with a strong focus on 
upskilling  and  reskilling,  and 
learning  and 
apprenticeships through vocational education and training. 

to  promote  work-based 

increased  efforts 

The  number  of  children  not  participating  in  early  childhood  education  and  care  remains 
high. Participation rates of children in pre-school education remains below the EU average. The 
percentages  are  lower  in  rural  areas  due  to  a  lower  demand  and  supply,  as  well  as  limited 
transportation  services  for  children  living  at  a  distance  from  their  pre-school.  A  shortage  of 
public kindergartens makes it more difficult for children from a low socio-economic background 
to participate in pre-school. 

9 

 
 
School  outcomes  are  below  the  EU  average,  with  a  wide  performance  gap  between  rural 
and urban areas. Current teaching practices, the socio-economic background and the lack of a 
systematic  quality  assurance  system  are  key  determinants  of  low  student  outcomes.  Teachers 
also lack the professional learning opportunities and high-quality digital infrastructure that would 
allow them to introduce more innovative teaching practices and foster digital competencies from 
early ages. The unattractiveness of the teaching profession and a weak initial teacher education 
system also have a negative impact on teaching quality. As a consequence, many pupils turn to 
private tutoring, which  contributes to  performance gaps  between students from  different  socio-
economic backgrounds. The school infrastructure, notably in rural areas, is inefficient and is not 
well adapted to shrinking student numbers. 

2.3. Challenges related to the twin transition   

2.3.1.  Green dimension 

The  recovery  and  resilience  plan  should  include  a  minimum  level  of  37%  of  expenditure 
related  to  the  green  dimension.  The  measures  in  the  plan  shall  contribute  to  achieving  the 
climate  neutrality  and  the  2030  energy  and  climate  targets  set  out  in  the  National  Energy  and 
Climate Plans (NECP). They are also expected to contribute to meeting environmental targets for 
waste,  water,  pollution  control,  sustainable  mobility,  biodiversity  protection  and  restoration, 
marine and water resources, and support the transition to sustainable food systems as well as to a 
circular economy as appropriate, while ensuring that nobody is left behind. The green transition 
in  Lithuania will require significant improvements in the energy and resource efficiency of the 
construction,  transport  and  industry  sectors.  Renewables  in  the  energy  mix,  the  circular 
economy,  air  and  water  quality  and  biodiversity,  as  well  as  the  boosting  green  transition  of 
businesses  through  adequate  measures  on  green  skills,  reduction  of  the  overall  environmental 
footprint  and  sustainable  innovation  (business  models,  technologies,  solutions,  products, 
services) are also key factors in the green transition. 

GHG emissions 

Lithuania  is  at  risk  of  missing  its  2030  climate  targets.  In  its  National  Energy  and  Climate 
Plan, Lithuania has pledged not to increase emissions by more than 15% by 2020 and to reduce 
them  by  9%  by  2030  compared  to  2005  emission  levels  in  sectors  not  covered  by  the  EU’s 
emission trading system (ETS). By 2018, non-ETS greenhouse gas emissions had increased by 
7%  compared  to  2005,  implying  that  the  2020  target  will  probably  be  achieved.  However,  the 
2030 climate change targets risk not being reached.  

10 

 
 
 
 
Table 3. Lithuania’s national targets and contributions regarding energy and climate  

National targets and contributions   

Binding target for greenhouse gas 
emissions compared to 2005 under the 
Effort Sharing Regulation (ESR) (%)  

National target/contribution for  
renewable energy: Share of energy from 
renewable sources in gross final 
consumption of  
energy (%)  

Latest 
available 
data  

2020  

2030  

Assessment of 
2030 ambition 
level  

7%  

15%  

-9%  

As in the ESR  

25.5%  

23%  

45%  

Sufficiently 
ambitious 
(formula: 34%)  

National contribution for energy efficiency:  

Primary energy consumption (Mtoe)  

6.3 Mtoe  

6.5 Mtoe   5.5 Mtoe  

Modest  

Final energy consumption (Mtoe)  

5.6 Mtoe  

4.3 Mtoe   4.5 Mtoe  

Modest  

Level of electricity interconnectivity (%)  

62%  

62%  

111%  

N/A  

Source: Assessment of the final national energy and climate plan of Lithuania, SWD (2020) 914 final. 

Share of renewables/ or Renewable energy 

Although  good  progress  has  been  made  on  deploying  renewable  energy  (except  in 
transport),  further  efforts  are  needed  to  reach  Lithuania’s  2030  target  for  renewable 
energy and energy efficiency. Thanks to its ambitious approach to the deployment of renewable 
energy,  Lithuania  reached  its  2020  renewable  energy  target  of  23%  as  early  as  2014,  with  the 
current  level  being  25.5%.  In  the  transport  sector,  however,  progress  has  been  slow:  the  2020 
target of 10% will be missed by approximately 5 percentage points. Lithuania’s 2030 target for 
renewable energy of 45% is considered sufficiently ambitious to contribute to the EU’s climate 
and  energy  targets.  Thanks  to  its  use  of  auctions  and  a  widespread  deployment  of  small-scale 
renewable  energy  installations  owned  by  individual  energy  consumers  and  communities, 
Lithuania expects that by 2030, the share of renewables in the electricity sector will reach 45%. 
Of this, wind energy will generate at least 70%, biofuels 9%, hydropower 8%, solar energy 3% 
and biogas 2%.  Lithuania projects  a share of  renewables of more than 67% in  the heating and 
cooling  sector,  rising  to  around  90%  in  district  heating.  Lithuania  would  benefit  from 
diversifying the energy  mix in  the heating sector and, apart from the use of biomass,  it should 
maximise the role of waste heat and remain vigilant with regard to the sustainability of biomass. 
Although biomass burning has contributed to energy independence and diversification, it is also 
a major contributor to air pollution, which is an increasing concern for Lithuania. 

Energy efficiency 

The  Lithuanian  economy  is  nearly  twice  as  energy  intensive  as  the  EU  average,  and  its 
industry, which is largely fuelled by gas, has the highest share of final energy consumption due 

11 

 
 
  
  
  
  
  
  
  
  
  
  
to  the  fact  that  energy-intensive  industries  make  up  a  rather  large  share  of  the  Lithuanian 
manufacturing  sector.4  It  has  a  several  highly  GHG-intensive  installations  in  the  chemicals, 
cement and refinery sectors, which are important economic operators and major employers in the 
less developed mid-west region of Lithuania. In relation to the 2030 energy efficiency targets, 
Lithuania  aims  towards  only  a  modest  contribution:  to  ensure  that  its  primary  and  final 
energy  intensity  will  be  1.5  times  lower  in  2030  than  it  was  in  2017.  The  country  would 
benefit  from  implementing  additional  policies  and  measures,  given  its  high  untapped  energy 
savings potential, especially in the transport and construction sectors, as well as in industry. In 
relation  to  residential  buildings,  the  scale  of  renovations,  as  set  out  in  the  NECP,  should  be 
increased  in  order  to  renovate  more  than  30  000  multi-apartment  buildings  and  achieve  the 
objective of an energy-efficient and decarbonised building stock by 2050.5 The Lithuanian Long-
Term Renovation Strategy set out the ambitious target of renovating 74% of the buildings stock 
(nearly  440,000  buildings)  by  2050,  with  no  primary  energy  generated  by  the  fossil  fuels 
consumed.  Targeted  incentives  to  improve  the  energy  performance  of  buildings,  including  the 
modernisation  of  district  heating  systems,  are  needed  to  reach  the  2030  energy  and  climate 
targets,  with  a  view  to  achieving  decarbonisation  objectives  by  2050.  A  study  on  the  building 
energy  renovation  potential  across  the  EU  estimates  that  in  Lithuania  the  renovation  of  79% 
existing dwellings by 2050, at a cost optimal level, could lead to primary energy savings of 5.2 
TWh and generate about 202,000 full time equivalent jobs6. 

Sustainable mobility 

Increasing the share of renewables in transport, notably by electrification and deployment 
of  advanced  biofuels,  is  needed  to  enhance  the  decarbonisation  of  the  entire  transport 
sector.  The  transport  sector  represents  almost  40%  of  all  greenhouse  gas  emissions,  as  it  is 
dominated  by  diesel  with  fast  growing  emissions.  Cars  remain  the  main  mode  of  transport. 
Public  transport  (rail  and  buses)  accounts  for  only  9.6%  of  passenger  travel  and  its  use  is 
decreasing. Alternative-fuel passenger cars represent less than 1% of total cars despite expanding 
networks of refuelling and electric charging points. Lithuania suffers from limited international 
connectivity in terms of rail, road, maritime and air transport. Rail traffic is dominated by east-
west flows, while the north-south axis remains underdeveloped. Despite increasing to 8% of the 
total network in 2018, Lithuania’s rail electrification remains one of the lowest in the EU.  

4 Tsemekidi-Tzeiranaki, S., Paci, D., Cuniberti, B., Economidou, M. and Bertoldi, P., Analysis of the Annual 
Reports 2020 under the Energy Efficiency Directive, EUR 30517 EN, Publications Office of the European Union, 
Luxembourg, 2020, ISBN 978-92-76-27416-2, doi:10.2760/180952, JRC122742. 
5 For a comprehensive assessment of the objectives and measures included in the long-term building renovations 
strategies see  Castellazzi, L., Zangheri, P., Paci, D., Economidou, M., Labanca, N., Ribeiro Serrenho, T., 
Zancanella, P. and Broc, J., Assessment of second long-term renovation strategies under the Energy Efficiency 
Directive, EUR 29605 EN, Publications Office of the European Union, Luxembourg, 2019, ISBN 978-92-79-98727-
4, doi:10.2760/973672, JRC114200; and Castellazzi L, Zangheri P and Paci D. Synthesis Report on the assessment 
of Member States` building renovation strategies . EUR 27722. Luxembourg (Luxembourg): Publications Office of 
the European Union; 2016. JRC97754 
6 Zangheri, P., Armani, R., Kakoulaki, G., Bavetta, M., Martirano, G., Pignatelli, F., Baranzelli, C. Building energy 
renovation for decarbonisation and Covid-19 recovery. A snapshot at regional level, EUR 30433 EN, Publications 
Office of the European Union, Luxembourg, 2020, ISBN 978-92-76-24766-1, doi:10.2760/08629, JRC122143. 

12 

 
 
                                                           
Multi-country projects 

Completing key cross-border projects - Rail Baltica in cooperation with Poland and other 
Baltic countries, and synchronisation of the electricity grid with the continental European 
network  by  2025  -  remain  key  challenges.  In  view  of  the  synchronisation  and  the  plans  to 
significantly  increase  renewable  energy  in  Lithuania’s  power  system,  it  will  be  important  to 
ensure  the  system’s  flexibility,  notably  by  taking  additional  measures  to  boost  storage  and 
demand response. 

Circular economy, water management, biodiversity 

Lithuania  would  benefit  greatly  from  a  comprehensive  national  strategy  or  roadmap  for 
the circular economy that focuses on the entire life cycle of products. While Lithuania is on 
track to  achieve the 55% recycling target  by 2025, its circular material  use rate is  only  around 
4%  which  is  more  than  two  times  lower  than  the  EU  average.  A  better-targeted  approach  and 
policy  measures,  as  well  as  additional  funding,  could  help  Lithuania  further  boost  its  eco-
innovation performance and resource productivity. Reform of the water supply and wastewater 
treatment  sector  through  the  consolidation  of  water  utilities  is  key  to  improving  the  quality, 
coverage, operational efficiency and affordability of water and sanitation services. The existing 
water  management  infrastructure  is  not  optimal  and  runs  at  around  half  of  its  capacity,  with 
strong quality, coverage and price differences across the country. 

Faster increases in environmental taxes and the cancellation of exemptions, would facilitate 
the  greening  of  the  Lithuanian  economy.  Environmental  taxes  in  Lithuania  are  mostly 
collected from taxes on energy and are significantly below the EU average, although recently the 
government  has  taken  action  to  increase  pollution  taxes.  In  synergy  with  these,  green  public 
procurement should also facilitate the green transformation of the Lithuanian economy.   

The  conservation  status  of  habitats  and  species  in  Lithuania  is  declining  and  the  current 
Natura  2000  network  is  incomplete.  Agricultural  greenhouse  gas  emissions  represent  a 
significant share of total non-CO2 greenhouse gas emissions, while the carbon sink capacity of 
grasslands  and  forests  is  decreasing.  In  2018,  the  government  decided  to  increase  by  6%  the 
annual  quota  for  logging  in  state-owned  forests,  including  protected  areas,  for  the  years  2019-
2023. The Baltic Sea is severely affected by general threats such as biodiversity loss and climate 
change, and by specific local pressures such as eutrophication, overfishing and elevated levels of 
contaminants. Lithuania has a great scope to invest more in environmental protection, especially 
in  more  effective  controls  of  pollution  from  industry  and  agriculture,  and  in  protecting  the 
country’s biodiversity and ecosystems. 

Lithuania’s  transition  towards  a  low-carbon  economy  requires  adaptations  in  the 
education  system  and  labour  market,  including  the  upskilling  and  reskilling  of  the 
workforce. This is to ensure that the Lithuanian workforce acquires the right skills to facilitate 
the  green  transition,  e.g.  in  the  areas  of  installing  green  technologies,  upgrading  building 
standards to ensure higher rates of energy savings, installing renewable energy infrastructure and 
applying circular economy solutions.   

2.3.2.  Digital dimension 

The  recovery  and  resilience  plan  should  include  a  minimum  level  of  20%  of  expenditure 
related to the digital dimension. The measures in the plan should, inter alia, contribute to the 

13 

 
 
digital transformation of the economic and social sector (including public administration, public 
services, and the justice and health systems). The objective of the measures in the plan should be 
to  improve  not  only  the  competitiveness,  but  also  the  resilience,  agility  and  security  of 
companies and public actors, all while ensuring inclusiveness. 

Lithuania ranks 14th in the Digital Economy and Society Index (DESI) 2020. A number of 
major  challenges  remain  along  Lithuania’s  path  to  digital  transition,  including  delayed 
deployment of 5G, a persistent and significant urban-rural digital divide in terms of broadband 
infrastructure, low levels of digital skills and a lack of ICT specialists, and limited digitalisation 
and uptake of advanced technologies across the Lithuanian SMEs and start-ups. 

In  terms  of  connectivity,  there  are  still  significant  gaps  in  fast  broadband  coverage  (19th 
rank  in  DESI  connectivity).  While  fibre  deployment  is  above  the  EU  average  both  for  urban 
and rural areas, only 69% of households have fast broadband coverage, compared to 86% at EU 
level,  with  the  figure  falling  to  only  29%  in  rural  areas.  With  only  68%  of  households 
subscribing to fixed broadband, Lithuania lags significantly behind the EU average of 78%.  

There  are  delays  in  5G  deployment.  In  May  2020,  Lithuania's  government  endorsed 
provisional  guidelines  for  5G  roll-out,  according  to  which  5 G  services  will  be  available  in  at 
least  one  city  by  2022  and  will  cover  the  most  populated  areas  by  2025.  However,  5G 
deployment  might  be  delayed  due  to  cross-border  coordination  issues  with  Russia  concerning 
certain frequency bands. 

Lithuania needs to improve the digital skills of the population and to invest in the re- and 
upskilling of its labour force (18th rank in DESI human capital). Based on 2019 data, 44% of 
the  population  lacks  basic  digital  skills  and  Lithuanian  companies  report  difficulties  in  filling 
ICT  vacancies.  This  is  a  major  obstacle  to  Lithuania’s  digital  transition  and  hampers  the 
country’s  capability  to  fully  exploit  its  innovation  potential.  Despite  a  number  of  national 
strategies  and  measures  aimed  at  developing  the  digital  economy  and  society,  relatively  few 
companies offer digital upskilling for employees, and businesses report significant difficulties in 
filling ICT specialist vacancies. 

Lithuania ranks above the EU average for the integration of digital technologies (10th rank 
in DESI integration of digital technology). The country has made progress over the last years 
and  excels  in  electronic  information  sharing,  with  48%  of  Lithuanian  enterprises  sharing 
information electronically compared to an EU average of 34%. Lithuania also performs well in 
online selling by SMEs, cross-border online selling to other EU countries and, even after a slight 
decrease recently, e-Commerce turnover.  Lithuania’s  performance with  regard to  corporate use 
of social media, cloud services and big data is close to the EU average.  

Lithuania is promoting the greening of digital technologies. The national energy and climate 
action  plan  for  2021-2030  provides  for  developing  digital  energy  innovations  and  improving 
technologies in the sectors related to energy, manufacturing and construction.  

Lithuania has the potential to make significant progress across all areas of the DESI index. 
Even  in  digital  public  services  (where  it  scores  highly),  Lithuania  can  still  improve  further  in 
open data as well as in priority areas  which are also underpinned by European policies (digital 
health, the European strategy for data, the Digital Education Action Plan, etc.). 

14 

 
 
Note: EU aggregate corresponds to EU28, based on 2020 DESI report. 

15 

 
 
 
 
Box 1: Progress towards the Sustainable Development Goals (SDGs) 

Overview table of the overlap between the Sustainable Development Goals and the four 
dimensions underpinning the recovery and resilience plans. 

This box outlines Lithuania’s performance with respect to the SDGs with particular relevance for 
the  four  dimensions  underpinning  the  recovery  and  resilience  plans  (green  transition,  fairness, 
digital transition and productivity, and macroeconomic stability), indicating possible areas where 
investments  and  reforms  in  line  with  the  objectives  of  the  Facility  could  further  accelerate  the 
progress on the SDGs. 

Green Transition 

Lithuania’s performance varies across the SDGs relating to the green transition. Lithuania 
is  lagging behind  in  terms  of the SDGs  ‘share  of buses and trains  in  total  passenger transport’ 
(9.6%  in  2018),  ‘circular  material  use’  (4%  in  2019),  ‘resource  productivity  and  domestic 

16 

 
 
 
material  consumption’  (0.74%  in  2019)  as  well  as  ‘energy  productivity’  (4.66%  in  2018). 
However, the SDG ‘share of renewable energy in gross final energy consumption’ is higher in 
Lithuania  than  the  EU  average  (i.e.  25.46%  in  2019  compared  to  the  EU  average  of  18.88%). 
The  SDG  ‘exposure  to  air  pollution’  is  below  the  EU  average.  In  the  index  of  greenhouse  gas 
emissions, Lithuania stood at 42.6% in 2018 compared to the EU average of 76.8%. 

Fairness 

Lithuania ranks relatively low with regard to indicators that assess the fairness of society 
and  the  economy.  In  2019,  26.3%  of  Lithuanians  were  at  risk  of  poverty  or  social  inclusion 
(SDG 1 ‘No poverty’) and 20.6% were at risk of income poverty after social transfers, compared 
to  21.4%  and  16.8%  respectively  on  average  for  the  EU-28.  Lithuania’s  performance  is  also 
below average for most indicators with regard to SDG 2 (‘Zero hunger’) and SDG 10 (‘Reduced 
inequalities’).  

The key indicators related to education show a weak performance of Lithuania. According 
to  the  ‘Quality  education’  (SDG  4)  and  ‘Gender  equality’  (SDG  5)  indicators,  participation  in 
early  childhood  education  and  adult  learning  in  Lithuania  is  lower  than  the  EU  average. 
However,  Lithuania’s  gender  employment  gap  of  only  1.6%  in  2019  is  one  of  the  lowest 
compared to the EU average of 11.4%.  

Lithuania has low results in indicators related to ‘Good health and well-being’ (SDG 3) a. 
The life expectancy at birth was 75 years in 2020 compared to the EU average of 81 years, and 
the death rates due to chronic diseases and to tuberculosis, HIV and hepatitis are well above the 
EU average. 

Digital transition and productivity 

Lithuania  scores  low  on  the  indicators  related  to  R&D.  Concerning  SDG  9  (‘Industry, 
innovation, and infrastructure’), Lithuania’s performance is weaker than average both in terms of 
‘R&D  and  innovation’  and  ‘sustainable  transport.’  With  0.99%  of  GDP  allocated  to  R&D  in 
2019,  Lithuania’s level  of investment  in  R&D remains very low and is  significantly below the 
EU  average.  Lithuania  is  also  significantly  lagging  behind  in  terms  of  the  number  of  patent 
applications to the European Patent office, with only 22 in 2017. 

Varying  performance  is  observed  with  regard  to  indicators  related  to  descent  work  and 
economic  growth  (SDG  8.)  The  performance  of  Lithuania  is  weak  in  terms  of  ‘real  GDP  per 
capita’  and  ‘resource  productivity’,  while  it  is  above  the  EU  average  with  regard  to    the 
‘employment rate’ and in line with EU average concerning the ‘long term unemployment rate’. 
In  2019,  11%  of  young  people  were  not  in  education,  employment  or  training,  which  is  just 
slightly below the EU-28 average. 

Macroeconomic stability 

Besides  its  better-than-average  performance  in  terms  of  the  SDG  8  indicators  described 
above, Lithuania also scores better than the EU average for most of the indicators relating 
to SDG 16 (‘Peace, justice, and strong institutions’), except for the indicator on ‘death rates for 
homicide’. 

17 

 
 
3.  OBJECTIVES, STRUCTURE AND GOVERNANCE OF THE PLAN 

3.1. Overall strategy of the plan 

The  Lithuanian  recovery  and  resilience  plan  seeks  to  address  the  challenges  identified  in 
the  context  of  the  European  Semester.  The  focus  is  on  digitalisation,  green  transition,  good 
quality  and  efficient  health  and  social  services,  education  and  innovation,  and  increasing 
efficiency  of  the  public  sector.  The  plan’s  strategy  is  structured  around  the  three  pillars  of 
resilience, climate and digital transition, and the goals mentioned above are reflected throughout 
its seven components. The total non-repayable financial support allocation for Lithuania is EUR 
2 224 195 119. The requested amount is EUR 2 224 686 966. 
There are 30 measures (27 reforms and 3 investments). 

Overview of components and associated costs:  

Component 

and 

for  growth 

energy  generation 

transformation  of  Lithuania 

A/I:  A  resilient  and  future-proof  health  system  
hereafter ‘Health component’  
(improving  quality  and  accessibility  of  health 
services  and  promoting  innovation,  long-term  care 
services  and  strengthening  the  resilience  of  the 
healthcare system) 
B/II:  Green 
hereafter ‘Green transition component’  
(renewable 
storage, 
reduction  of  transport  emissions  through  clean 
mobility,  buildings  renovation,  circular  economy 
and degraded peatlands restoration)  
C/III:  Digital 
transformation 
hereafter ‘Digital transition component’  
(digitalisation of public and business sectors, digital 
skills, 5G and broadband) 
D/IV: 4. 
for the entire life-cycle  
hereafter ‘Education component’ 
(improving  the  school  network,  the  quality  of 
education, vocational training and of adult learning) 
E/V:  Higher  education,  a  coherent  framework 
for stimulating innovation and high value-added 
business  
hereafter  ‘Higher  education  and  Innovation 
component’ 
(improving  R&I  promotion  and  quality  and 
efficiency of higher education sector) 
F/VI:  Efficient  public  sector  and  preconditions 
to recover after the pandemic  

Quality  and  accessible  education 

18 

Costs (EUR million) 

268 (12%) 

823 (37%) 

448 (20%) 

312 (14%) 

200 (9%) 

64 (3%) 

 
 
 
hereafter ‘Public sector component’  
(tax  compliance,  tax  system,  budgetary  framework 
and improving public administration) 
G/VII:  More  opportunities  for  everyone  to 
actively build national well-being  
hereafter ‘Social protection component’ 
(training  and  employment  support  scheme  and 
adequacy of the social safety net) 
Total:  

109 (5%) 

EUR 2.225 billion 

Health  component.  Accounting  for  EUR  268  million  or  12%  of  the  plan,  this  component 
contributes to addressing challenges related to the resilience, quality, accessibility and efficiency 
of  the  healthcare  system.  The  creation  of  a  centre  for  advanced  therapies  should  ensure  the 
availability  of  innovative  advanced  therapies.  Furthermore,  investments  shall  be  made  to 
strengthen  Lithuania’s  genetic  research,  personalised  medicine  and  facilitate  secure  matching 
within  the  framework  of  the  European  cross-border  project  “1+  Million  Genomes”.  The 
establishment of a health professionals’ competence platform should help identify, monitor and 
match the supply and demand for health professionals. The development of an integrated model 
for  measuring  the  quality  of  health  care  is  also  envisaged.  Investments  in  digitalisation  of  the 
health  system  should  facilitate  the  integration  of  various  health  information  resources  into  a 
system based on uniform principles.  

Measures  on  long-term  care  focus  on  setting  up  of  ten  day  care  centres  across  the  country, 
providing  equipment,  vehicles  and  creating  ninety  mobile  teams  to  contribute  to  developing 
outpatient services, accompanied by a reform of the long-term care framework. The resilience of 
the health system should be strengthened by targeted investments in infrastructure of healthcare 
facilities  responsible  for  crisis-responsiveness.  In  particular,  developing  the  capacity  in  five 
centres  of  expertise  in  the  cluster  of  infectious  diseases  and  modernisation  of  emergency, 
resuscitation  and  intensive  care  medical  units  in  seven  hospitals/trauma  centres  are  planned 
across the country. These investments should help reorganise the ambulance services to ensure 
that  the  necessary  medical  assistance  timely  reaches  the  population.  They  should  also  enhance 
the capacity to treat infectious diseases without increasing the total number of curative and long-
term  care beds  at  national  level.  A particular  attention will be given to  primary healthcare and 
prevention measures using national and other EU financial instruments. 

Green  transition  component.  With  EUR  823  million  or  37.8%  of  the  plan,  this  component 
envisages  the  development  of  offshore  wind  infrastructure,  support  for  the  construction  of 
onshore  RES  plants  (solar  and  wind  power),  individual  energy  storage  facilities  and  the 
establishment of renewable energy communities, and the installation of other electricity storage 
infrastructure. As regards mobility, key measures cover support for the replacement of polluting 
road  transport  vehicles  used  by  the  public  sector  and  businesses  into  zero-emission  and  low 
emission  vehicles,  to  improve  the  quality  and  attractiveness  of  public  transport  services  by 
upgrading  public  transport  vehicles  with  zero  or  low  emission  vehicles,  to  establish 
charging/refilling  infrastructure  for  all  types  of  clean  vehicles  using  alternative  fuels,  and  to 
develop the alternative fuels sector (biomethane, second generation liquid biofuels, hydrogen).  

19 

 
 
 
 
standards,  municipal  development  plans, 

Greater  energy  efficiency  is  planned  to  be  achieved  by  the  building  renovation  packages  and 
renovation 
sustainable  urban  development 
methodologies  and  district  renovation  projects7,  establishment  of  a  competence  centre  for 
building  renovation  to  provide  coordination  and  technical  assistance,  promoting  the  supply  of 
construction  products  and  services  that  speed  up  the  renovation  of  buildings  and  funding  for 
renovation. To restore the capacity of degraded peatlands to absorb and store GHG, a reform to 
restore these areas is envisaged as result of which 8000ha of peatlands will be restored upon the 
Plan’s  implementation.  Finally,  resource  efficiency  will  be  advanced  with  the  adoption  of  the 
Circular  Economy  Action  Plan,  which  will  lay  out  the  direction  to  more  resource  efficient 
Lithuanian by 2035.  

Digital transformation component. This component is attributed EUR 448 million or 20% of 
the  Plan.  The  digitalisation  of  public  sector  represents  by  far  the  largest  part  of  reforms  and 
investments. Other envisaged measures relate to improving digital connectivity and digital skills, 
as  well  as  promoting  advanced  digital  technologies  and  the  digitalisation  of  businesses.  The 
digitalisation  of  the  public  sector  includes  measures  to  (i)  fully  consolidate  state  information 
resources, IT infrastructure and services, (ii) ensure the availability of reliable public sector data 
and the possibility to share it across sectors; and (iii) fully digitalise government processes and 
expand  digital  public  services,  while  ensuring  that  all  digital  public  services  are  accessible  for 
citizens with disabilities. Furthermore, the Plan puts forward investments to create the necessary 
conditions  for  science  and  businesses  to  develop  and  deploy  advanced  digital  technologies 
capable  of  communicating  in  the  Lithuanian  language  as  well  as  ensure  universal  access  to 
digitised and digital resources. This enables science, business and society to develop innovative 
technologies,  services  and  products  based  on  cultural  content.  Measures  to  improve  digital 
connectivity  will  aim  to  put  in  place  50  towers  and  2000km  of  fibre  infrastructure  in  market 
failure  areas  as well  as  provide access to  Gigabit  speed broadband for 5000 digitally intensive 
enterprises/institutions. In addition, by the end of 2025 the 5G mobile rollout will be completed, 
notably in international land transport corridors (Via Baltica, Rail Baltica) and other trunk roads 
and railway lines of national significance, airports and seaports. Finally, the RRP includes as a 
horizontal  theme  an  agenda  to  promote  the  development  of  digital  skills  at  all  levels  of  the 
society, including pupils, employees, jobseekers, vulnerable groups, and older people. 

Education component. EUR 311.5 million or 14% of the Plan aim at consolidating the school 
network,  improving  pre-  and  general  education,  vocational  education  and  training,  as  well  as 
adult learning. The long- standing challenges related to the efficiency and quality of education at 
all  levels  and  skills  promotion  will  be  addressed  by  reforms  and  investments.  The  content  of 
early childhood education and care will be updated on the basis of scientific progress  and new 
methodological tools will be developed to help assess children’s educational needs and progress 

7 In line with a “district” approach to energy efficiency renovations: Shnapp, S., Paci, D. and Bertoldi, P., Enabling 
Positive Energy Districts across Europe: energy efficiency couples renewable energy, EUR 30325 EN, Publications 
Office of the European Union, Luxembourg, 2020, ISBN 978-92-76-21043-6, doi:10.2760/452028, JRC121405; and 
Saheb, Y., Shnapp, S. and Paci, D., From nearly-zero energy buildings to net-zero energy districts, EUR 29734 EN, 
Publications  Office  of  the  European  Union,  Luxembourg,  2019,  ISBN  978-92-76-02915-1,  doi:10.2760/693662, 
JRC115188. 

20 

 
 
                                                           
from  an  early  age.  Consolidating  teaching  and  learning  resources  will  be  improved  via  the 
“Millennium Schools” programme. The opportunities for teachers to improve their qualifications 
will be expanded. School infrastructure will be reorganised and improved. The attractiveness and 
quality  of  vocational  education  and  training  will  be  increased  by  expanding  the  access  to 
vocational  training  through  schools  and  work-based  learning  and  strengthening  the  coherence 
between education content and labour market needs. A reform of a career planning system and 
career  counselling  services,  recognition  of  competences  acquired  via  formal  and  non-formal 
learning,  one-stop  shop  lifelong  learning  system  operating  on  the  basis  of  individual  learning 
accounts should help better respond to labour market needs, including those needed for the green 
and digital transition.   

Higher  education  and  innovation  component.  EUR  200.2  million  or  9%  of  the  plan  are 
envisaged  for  measures  to  gear  the  funding  model  of  the  higher  education  system  towards 
contract-based  system; 
increase  students’  admission  standards;  promote  research  and 
internationalisation of universities; set higher qualitative standards for colleges and universities. 
The consolidation of agencies responsible for innovation promotion is expected to make research 
and  innovation  policies  more  efficient,  however,  the  ambition  level  of  consolidation  could  be 
higher and encompass more agencies. The narrowing of the national  smart specialisation areas 
and support for mission-based science-business cooperation are also envisaged.  

Public  sector  component.  With  EUR  64  million  or  3%  of  the  plan,  this  is  financially  the 
smallest  component  in  the  plan.  However,  it  includes  important  reforms  and  accounts  for  the 
largest share of milestones and targets. The measures in the component aim at (i) improving tax 
compliance and broadening the tax base, (ii) enhancing the budgetary framework, (iii) improving 
business environment, and (iv) improving HR management in the public sector, including staff 
training.  The  reform  on  enhancing  tax  administration  to  reduce  the  VAT  gap  at  a  faster  pace 
includes  improving  data  analytics,  development  of  a  number  of  IT  tools,  also  used  in  customs 
work,  and  investments  in  staff  competences  of  the  State  Tax  Inspectorate  and  the  Lithuanian 
Customs. Planned legal measures to limit transactions in cash is especially important in tackling 
the  shadow  economy.  In  addition,  this  component  comprises  commitments  to  amend  tax 
legislation in order to broaden the tax base to sources less detrimental to growth and to improve 
the  redistributive  capacity  of  the  tax-benefit  system.  The  reform  on  the  budgetary  framework 
aims  at  introducing  methodologies  and  tools  needed  for  medium-term  budgetary  planning  and 
enhancing  the  rules  on  budget  amendments  and  determination  of  municipal  revenues.  It  also 
encompasses  the  introduction  of  spending  reviews  and  the  development  of  a  tool  to  compare 
budgetary indicators of municipalities. The measure aims at enhancing the rules of public-private 
partnership  (PPP)  planning  and  their  incorporation  in  budgets.  The  reform  on  business 
insolvency  management  aims  at  creating  four  digital  tools  which  should  support  business  and 
other actors in insolvency management.  

Social protection component. The component aims at contributing to the implementation of the 
European Pillar of Social Rights and addressing some of the long-standing challenges related to 
social exclusion, poverty and income inequality as well as to the low coverage of active labour 
market measures. The reforms and investments in the social component will be supported with 
EUR  109  million  or  5%  of  the  plan  and  are  centred  around  two  headline  measures  –  the 
customer-oriented  employment  support  and  the  guaranteed  minimum  income  protection. 
Customer-oriented employment support measures include optimisation and digitalisation of the 
public employment service’s operational processes along with the training and entrepreneurship 

21 

 
 
support measures in the areas of twin transition and circular economy and with the focus on high 
value-added  jobs.  Several  reforms  are  included  as  part  of  the  Guaranteed  minimum  income 
protection  measure.  In  particular,  they  concern  increasing  coverage  of  the  unemployment 
insurance  scheme, 
introducing  additional  benefits to single elderly  and  disabled people, 
improving the  pension  indexation  mechanism  and developing  an  accreditation  scheme  for 
institutions  providing  social  care. Some  further  changes  will  be  implemented  following  a 
comprehensive  analysis  of  the  minimum  income  scheme  and  will  include  changes  to  the  key 
legal  acts,  i.e.  the  Law  on  cash  social  assistance,  the  Law  on  the  determination  of  reference 
indicators of social security benefits and the basic amount of penalties as well as Law on social 
insurance for sickness and maternity. 

3.2. Implementation aspects of the plan  

The  plan  describes  and  ensures  consistency  with  the  other  main  European  and  national 
programmes and planning documents. On 9 September 2020, Lithuanian Government adopted 
a National Progress Plan for 2021-2030. It aims at identifying the main changes to achieve over 
the next decade, to ensure progress in the social, economic, environmental and security fields. In 
total, the National Progress Plan is expected to invest around EUR18 billion between 2021 and 
2030,  where  the  EU  and  other  international  financial  investments  account  for  around  82  %  of 
total  planned  investment.  On  11  December  2020,  the  national  Parliament  approved  the 
Programme of the present Government. The RRP is consistent both with the National Progress 
Plan and the implementation plan of the Programme of the Government. The RRP is also broadly 
consistent  with  the  National  Climate  and  Energy  Plan,  the  Territorial  Just  Transition  Plan  (in 
preparation),  the  Youth  Guarantee,  Partnership  Agreement  (in  negotiation)  and  Operational 
Programmes (in negotiation). 

The  RRP  is  broadly  consistent  with  the  challenges  and  priorities  identified  in  the  most 
recent  euro-area  recommendation  (EAR).  The  Council  recommendation  on  the  economic 
policy  of  the  euro  area8  recommended  to  euro  area  Member  States  to  take  action,  including 
through their recovery and resilience plans, to, inter alia, ensure a policy stance which supports 
the  recovery  and  to  further  improve  convergence,  resilience  and  sustainable  and  inclusive 
growth.  The  Council  recommendation  also  recommended  to  strengthen  national  institutional 
frameworks,  to  ensure  macro-financial  stability  and  to  complete  EMU  and  strengthen  the 
international role of the euro.  

The  plan  sets  out  a  clear  administrative  organisation  for  its  implementation.  Lithuania’s 
Ministry  of  Finance,  which  is  the  Managing  Authority  for  Cohesion  Policy  programmes,  will 
also be the national coordinator for the RRF. The Ministry of Finance will work closely with line 
ministries in order to ensure and monitor the implementation of the plan. 

8  Pending  final  adoption  by  the  Council,  after  endorsement  by  the  European  Council.  The  text  agreed  by  the 
Eurogroup  on  16  December  2020  is  available  at:  https://data.consilium.europa.eu/doc/document/ST-14356-2020-
INIT/en/pdf 

22 

 
 
 
                                                           
 
Lithuania  plans  the  implementation  of  various  measures  to  promote  gender  equality  and 
equal  opportunities  during  the  implementation  phase  of  some  investments.  With  regard  to 
gender equality and equal opportunities for all, the plan describes existing national challenges in 
terms of gender equality and needs of persons with disabilities, and explains which reforms and 
investments are expected to contribute to addressing the challenges identified. The challenges are 
supported  by  statistics  disaggregated  by  gender.  This  description  includes  a  wider  reference  to 
legislative and policy initiatives that are due to complement the reforms and investments in the 
plan in order to overcome the identified equality challenges. The plan states that ensuring equal 
opportunities  for  all  is  a  horizontal  principle  that  will  be  consistently  applied  through  all 
implementation  phases.  Lithuania  plans  to  collect  equality  data  and  develop  competences  for 
public sector workers to strengthen the implementation of policies promoting equal opportunities 
for all policies at local level. 

Relevant  stakeholders  have  been  consulted.  Between  November  2020  and  April  2021,  the 
Ministries  responsible  for  the  respective  components  of  the  plan,  conducted  a  number  of 
individual  consultations  with  the  social  partners.  From  23  February  to  1  March  2021,  six 
discussions  with  the  social  partners,  including  employer  organisations,  trade  unions,  local 
authorities  and  non-governmental  organisations,  were  organised,  which,  among  other  issues, 
discussed the reform and investment priorities for the RRP. The first partial draft of the plan was 
made  public  in  mid-April  2021,  allowing  citizens  and  organisations  to  submit  their  comments. 
Around  three  quarters  of  300  responses  received  were  considered  before  submitting  the  final 
plan  to  the  Commission.  The  draft  plan  was  regularly  discussed  in  the  Lithuanian  Parliament. 
The stakeholder involvement was facilitated by a dedicated website under the management of the 
Lithuanian Ministry of Finance9. The views of the social partners were particularly reflected in 
the elaboration of the measures in the component on digital transition. The national stakeholders, 
including social partners, have nonetheless raised concerns about their limited involvement in the 
preparation  of  the  plan.    It  will  be  important  to  further  strengthen  the  dialogue  with  the  social 
partners and civil society during the plan’s implementation phase, involving them in the reform 
and investment-related decision making, monitoring and evaluation processes.  

The  RRP  broadly  outlines  Lithuania’s  communication  strategy.  The  objectives  of  the 
communication  strategy  are  consistent  with  the  RRF  Regulation  and  aim  to  ensure  awareness 
about the EU’s contribution to mitigate the economic and social consequences of the COVID-19 
pandemic and to the twin transition.   

The target audiences are clearly defined and justified based on their specific role in relation 
to  the  RRF.  These  will  cover  the  general  public,  the  social  and  economic  partners,  potential 
applicants,  final  recipients,  the  media  and  opinion  makers.  The  communication  activities  will 
take  into  consideration  the  geographical  and  thematic  scope  of  the  plan  as  well.  The 
communication tools and channels will be adapted to the type of communication activity and the 
needs of the target audiences. The main channel of disseminating information will be the website 
of the Ministry of Finance which will be the central entry point on all aspects in relation to the 

9 https://finmin.lrv.lt/lt/es-ir-kitos-investicijos/naujos-kartos-lietuva  

23 

 
 
                                                           
planning  and  implementation  of  the  plan.  In  addition  to  this,  traditional  (printed  media,  TV, 
radio,  etc.)  and  digital  tools,  including  social  media,  will  be  used.  Lithuania  has  foreseen  an 
estimated budget of 0.15% of the overall allocation of the plan for communication purposes that 
will be ensured through the national budget. The overall budget will be adapted to the needs and 
challenges in terms of achieving the overall communication targets.  

The plan foresees a wide range of coordinated communication activities with the European 
Commission, including joint communication messages and joint events. The plan identifies 
key  communication  areas  such  as  sustainable  electricity  production,  sustainable  transport, 
digitalisation  of  state  administration  and  connectivity,  general  education  and  resilience  of  the 
health system. 

State  aid  and  competition  rules  fully  apply  to  the  measures  funded  by  the  Recovery  and 
Resilience Facility. Union funds channelled through the authorities of Member States, like the 
RRF funds, become State resources and can constitute State aid if all the other criteria of Article 
107(1)  TFEU  are  met.  When  this  is  the  case  and  State  aid  is  present,  these  measures  must  be 
notified and approved by the Commission before Member States can grant the aid, unless those 
measures are covered by an existing aid  scheme or comply  with  the applicable conditions  of a 
block  exemption  regulation,  in  particular  the  General  Block  Exemption  Regulation  (GBER) 
declaring certain categories of aid compatible with the internal market in application of Articles 
107 and 108 TFEU10. When State aid is present and it requires notification, it is the duty of the 
Member  State  to  notify  State  aid  measures  to  the  Commission  before  granting  them,  in 
compliance  with  Article  108(3)  TFEU.  In  this  respect,  the  State  aid  analysis  carried  out  by 
Lithuania in the recovery and resilience plan cannot be deemed a State aid notification. In as far 
as  Lithuania  considers  that  a  specific  measure  contained  in  the  recovery  and  resilience  plan 
entails de minimis aid or aid exempted from the notification requirement, it is the responsibility 
of  Lithuania  to  ensure  full  compliance  with  the  applicable  rules.  Irrespective  of  whether  they 
comply  with  the  EU’s  State  aid  regime,  measures  taken  under  this  framework  should  be 
compatible with the EU’s international obligations, in particular under World Trade Organization 
rules. 

The Lithuanian RRP contributes to the following cross-border and multi-country projects: 

- 

 5G  services  in  international  land  transport  corridors:  The  plan  includes  measures  to 
facilitate  the  development  of  the  5G  mobile  network  along  international  land  transport 
corridors,  including  Via  Baltica  and  Rail  Baltica,  which  also  directly  contributes  to 
strengthening social and territorial cohesion. In addition, reforms in the digital field, such as 
the  “Transformation  of  public  information  technology  governance”,  “Prerequisites  for 
innovative technological solutions  in  business  and daily life” or  “Client-Oriented Services” 
could pave the way to cross-border projects.  

-  The  1+  Million  Genomes:  A  multi-country  project  which  brings  together  European 
countries  to  build  a  high-quality  European  network  of  national  genomic  reference  cohorts, 
representative of the European population. 

10 Commission Regulation 651/2014, OJ L 187, 26.6.2014, p. 1 

24 

 
 
                                                           
Furthermore, opportunities for future cooperation with other EU members are expected to 
arise  from  implementing  reforms  and  investments  under  the  component  on  green 
transition.  Those  measures  could  create  positive  indirect  incentives  for  EU  cross-border 
projects. For example, planned investments aimed at promoting the use of organic materials in 
construction processes and related innovation and technological progress in industry through the 
creation  of  production  and  technological  capacity  in  Lithuania  may  create  additional 
preconditions  for  imports  of  relevant  raw  materials  and  exports  of  finished  products.  Similar 
effects  are  expected  to  arise  from  the  implementation  of  the  reform  “Towards  a  circular 
economy”  and  other  reforms  and  investments  related  to  sustainable  electricity  generation, 
sustainable increase of transport and GHG absorption capacity or renovation of buildings. 

The  Lithuanian  plan  includes  a  security  self-assessment  for  investments  in  5G  networks, 
which refers to and describes the national legislation implementing key measures recommended 
in  the EU Toolbox. As regards cloud  investments  towards the development  and extension of a 
governmental cloud, the plan mentions security as one of the objectives of this reform. Strategic 
measures mentioned in the security self-assessment would need to be closely monitored during 
the implementation of the plan. 

4.  SUMMARY OF THE ASSESSMENT OF THE PLAN 

4.1. Comprehensive  and  adequately  balanced  response  to  the  economic  and  social 

situation  

The plan includes a balanced set of reforms and investments contributing to the six policy 
pillars  referred  to  in  Article  3  of  the  Regulation.  Lithuania’s  plan  consists  of  seven 
components,  covering  a  broad  range  of  policy  areas:  1.  Health,  2.  Green  transition,  3.  Digital 
transition,  4.  Education,  5.  Higher  education  and  Innovation,  6.  Public  sector,  7.  Social 
protection. Each component encompasses reforms and investments that are mutually reinforcing. 
One component in the Lithuanian plan is directly related to the green transition (pillar 1). Two 
components  directly  addresses  the  digital  transformation  and  four  indirectly  contribute  to  it 
(pillar  2).  The  remaining  four  policy  pillars  are  addressed  adequately  through  measures  to:  (i) 
strengthen the health and long-term care systems; (ii) reduce poverty; (iii) improve the quality of 
the  education  and  vocational  education  and  training  systems;  (iv)  incentivise  innovation  and 
support  entrepreneurship;  (v)  digitalise  public  services,  make  the  public  administration  more 
efficient,  improve  budgetary  framework  and  tax  compliance  supporting  the  sustainability  of 
public  finances.  The  coverage  of  the  Lithuanian  plan  toward  the  six  pillars  is  summarised  in 
Table 4 below. The green and digital pillars also meet the minimum thresholds. 

25 

 
 
 
 
Table 4. Coverage of the six pillars of the Facility by the Lithuanian RRP components 

Green 
transiti
on  

Digital 
transfor
mation  

Smart, 
sustainab
le & 
inclusive 
growth  

Social 
and 
territorial 
cohesion  

Health, 
and 
economic, 
social and 
institution
al 
resilience  

Policies 
for the 
next 
generati
on  

1. Health 

2. Green transition 

3. Digital transition 

4. Education 

5. Innovation & 
science  

6. Public sector 

7. Social protection 

○ 

●  

○ 

○ 

○  

○ 

○ 

● 

○  

● 

○ 

● 

● 

● 

● 

○ 

○  

● 

○ 

● 

○ 

● 

● 

○ 

● 

○ 

● 

● 

Key:  “●”  investments  and  reforms  of  the  component  significantly  contribute  to  the  pillar;  “○”  the  component 
partially contributes to the pillar  

1st pillar: green transition 

Green challenges are addressed in the plan mostly under component 2 on green transition. 
Investments  in  energy  efficiency,  clean  transport  emissions  and  circular  economy,  as  well  as 
reforms  in  renewable  energy,  are  expected  to  contribute  to  Lithuania’s  climate  and  energy 
objectives.  Measures  fostering  the  green  transition  entail  the  promotion  of  the  production  and 
storage  of  renewable  energy;  the  reduction  of  emissions  from  transport  by  replacing  polluting 
vehicles  with  clean  vehicles;  the  acceleration  of  renovation  of  buildings  and  sustainable  urban 
environment; and the promotion of a circular economy. 

Other components indirectly contribute to the green transition. For instance, to some extent, 
under component 5 (higher education and innovation), the measure to support green innovation 
is  expected to  contribute to  the green transition,  as well as some measures under component 1 
(health) such as the provision of long-term care services measure and component 7 (social) under 
client-centered employment support measure. Moreover, component 6 (public sector) is expected 
to contribute to the green transition by expanding environmental taxation. In addition, green and 
innovative public procurement measures, addressed in component 2 (green) and included under 5 
(higher education and innovation), contribute to the green transition to some extent as well.  

26 

 
 
 
   
  
  
  
  
  
  
 
  
  
  
  
  
  
  
 
 
Based  on  the  methodology  for  climate  tracking  set  out  in  Annex  VI  of  Regulation  (EU) 
2021/241,  the  quantitative  assessment  of  the  plan  in  relation  to  the  climate  target  finds  a 
contribution of 37.8% of the total allocation, thereby complying with the minimum threshold of 
37%.  

2nd pillar: digital transformation 

Measures under component 3 (Digital transition) and component 6 (public sector) directly 
contribute  to  the  digital  transformation.  They  notably  relate  to  the  science-business 
framework to develop and deploy advanced digital technologies, the digitalisation of government 
processes and the expansion of digital public services, and the consolidation of state information 
resources. Efficiency both in the public administration and business sector will be supported by 
enhancing  digital  connectivity  (5G  and  broadband).  The  one  stop  shop  lifelong  learning  IT 
system based on individual learning accounts will also make adult learning more efficient. Other 
measures under component  1 (health) such as e-health, component 2 (green transition) (e.g.  IT 
tools for charging stations and renovations support), component 4 (education) and component 7 
(social protection), are expected to contribute indirectly to the ‘second pillar’. 

Based on the methodology for digital tagging set out in Annex VII of Regulation (EU) 2021/241, 
the  quantitative  assessment  of  the  Plan  in  relation  to  the  digital  target  finds  a  contribution  of 
31.5% of the total allocation, therefore complying with the minimum threshold of 20%, with a 
direct contribution from 2 components out of 7.   

3rd pillar: smart, sustainable and inclusive growth 

The  green,  digital  and  higher  education  components  (components  2,  3,  5)  provide 
opportunities  for  job  creation,  economic  competitiveness  and  sustainable  long-term 
growth. 

Under  the  component  on  green  transition  (component  2),  Lithuania  pledges  to  reduce  its 
dependence  on  non-renewable  energy  and  create  the  necessary  framework  and  infrastructure 
throughout  the  country.  Also,  Lithuania  will  support  the  purchase  of  clean  vehicles  for  public 
sector  and  businesses,  as  well  as  for  public  transport  vehicles  in  various  municipalities.  The 
adoption  and  further  implementation  of  the  Circular  Economy  Action  Plan  could  have  a 
considerable impact on labour market benefiting from business opportunities in new value chains 
within  different  industrial  ecosystems  (also  cross-border)  and  thus  contributing  to  sustainable 
growth. 

Under  the  component  on  digital  transition  (component  3),  the  measures  aimed  at  fostering  the 
digitalisation of the public sector, the economy, and academia are expected to make the economy 
more  resilient  to  potential  shocks,  using  digital  competitiveness  as  a  key  driver  of  economic 
recovery.  Different  digital  investments  strands  envisaged  in  the  component  (new  technological 
solutions,  digital  innovation,  AI  development  or  IT  business  creation)  are  mutually  linked  and 
contribute to further digitalisation of businesses. Adaptation to smart digital solutions could help 
to enable a faster digital transition and make the economy more competitive and resilient. 

Under  the  component  on  higher  education  and  innovation  (component  5),  there  are  measures 
aimed  at  gearing  the  funding  model  of  the  higher  education  system  towards  contract-based 
system,  at  promoting  research  and  internationalisation  of  universities,  and  at  setting  higher 
qualitative standards for colleges and universities. The consolidation of agencies responsible for 

27 

 
 
innovation  promotion  is  expected  to  make  research  and  innovation  policies  more  efficient.  A 
new  innovation  policy  framework,  promoting  innovative,  high  value-added  solutions  for 
businesses and industries, could attract private investments, enhance export activities, create new 
job and business opportunities and stimulate economic growth. 

Other  growth-enhancing  measures  are  expected  to  tackle  structural  weaknesses  of  the 
economy, enhance economic resilience and productivity. 

Under  the  component  on  public  sector  (component  6),  the  measures  are  aimed  at  reducing  the 
currently  large  VAT  gap,  collecting  additional  funds  for  the  national  budget,  which  could  be 
used  to  finance  social  spending.  In  addition,  new  digital  tools,  helping  businesses  to  better 
manage insolvency risk, have a potential to improve conditions for doing business in Lithuania, 
strengthen  entrepreneurship  performance,  attract  private  investments  and  enhance  economic 
resilience. 

Measures under the component on social protection (component 7) are also expected to improve 
labour  market  outcomes,  thereby  contributing  to  the  ‘third  pillar’.  Lithuania  will  facilitate  the 
ability to take up and stay in employment, invest in active labour market policies and focus on 
training, which will contribute to the inclusiveness of growth. Finally, investments and reforms 
in  the  education  system  (under  component  4)  are  also  expected  to  contribute  to  Lithuania’s 
competitiveness in the long-run. 

4th pillar: Social and territorial cohesion  

The  plan’s  components  on  health,  education,  public  sector  and  social  protection  (i.e. 
components  1,  4,  6,  7)  include  measures  that  aim  at  improving  social  inclusion  and 
addressing  regional  disparities,  thereby  contributing  directly  to  the  ‘fourth  pillar’. 
Investments  in  the  healthcare  infrastructure  (five  infectious  disease  clusters;  seven  regional 
emergency  and  reanimation  and  intensive  care  divisions;  tools  to  provide  healthcare  services 
electronically) are expected to improve the territorial coverage of emergency and acute care for 
people  with  infectious  diseases  and  ensure  affordable,  high-quality  and  safe  diagnostic  and 
treatment  services for the whole  Lithuanian population.  Another investment  to  be funded  from 
the  RRF  will  focus  on  establishing  90  mobile  teams  providing  long-term  care  services.  Such 
teams  will  cover  the  whole  territory  of  the  country,  with  additional  attention  to  rural 
municipalities. 

In  order  to  address  urban-rural  gaps  in  access  to  quality  education,  Lithuania  plans  to 
implement  a  number  of  measures.  The  so-called  Millennium  Schools  programme  aims  at  a 
coherent,  gradual  renovation  of  schools  and  creating  equal  conditions  for  Lithuanian  children, 
despite their place of residence, social, economic or cultural background. Municipalities would 
be  encouraged  to  consolidate  educational  resources  and  strengthen  existing  schools  through  a 
new funding system. Funds will be available if municipalities with at least 1 000 enrolled pupils 
submit a plan that meets quality and efficiency criteria. Smaller municipalities will also be able 
to  apply  for  this  programme  together,  e.g.  metropolitan  and  surrounding  municipalities,  with 
several adjacent smaller municipalities. This will promote school network beyond the territory of 
one  municipality  and  should  encourage  smaller  schools  to  connect  to  larger  entities.  Lithuania 
plans  to  map  childcare  infrastructure  to  assess  how  to  improve  accessibility  tackling  territorial 
and  social  imbalances  in  childcare  provision.  The  enhanced  mobility  programme  will  also 

28 

 
 
contribute  to  reduce  urban-rural  gap  by  facilitating  the  take-up  of  vocational  education  and 
training for students living in remote areas. 

The  component  on  social  protection  contains  two  sets  of  measures  to  support  social 
cohesion  –  revision  of  minimum  income  system  and  social  benefits,  and  additional  active 
labour market policy measures. In the plan, Lithuania commits to revise the minimum income 
system and unemployment, sickness and maternity benefits with a view to increase them and in 
this way somewhat strengthen the redistributive power of the tax and benefit system. The efforts 
are to be complemented by a new type of social benefits for single persons. The plan is also set 
to enable jobseekers to enhance their qualifications and competences through vocational training 
and higher education programmes. In addition, jobseekers will be given the opportunity to learn 
by participating in apprenticeship programmes. 

In  addition,  the  component  on  public  sector  is  assumed  to  contribute  to  social  and 
territorial  cohesion  through  higher  tax  revenues,  better  expenditure  management  and 
improvements  in  financial  management  of  municipalities.  Improvements  in  tax  compliance 
and  additional  tax  revenues  from  broadening  the  tax  base  potentially  could  provide  additional 
funds for social needs, whereas the expected amendments to personal income taxation and social 
insurance  contributions  could  contribute  to  reducing  poverty  and  income  inequality.  Savings 
resulting  from  spending  reviews  could  be  used  for  the  same  purposes  as  well.  Adjustments  to 
municipal  revenues,  tools  to  determine  funding  needs  and  promotion  of  public-private 
partnerships are expected to support regional investments, contributing to territorial cohesion. 

Finally,  the  component  on  green  transition  is  also  expected  to  contribute  to  some  extent  to 
territorial cohesion, notably as Lithuania will support the purchase of public transport vehicles in 
various municipalities and installation of RES plants and storage. 

5th  pillar:  Health  and  economic,  social  and  institutional  resilience,  with  the  aim  of 
increasing crisis preparedness and crisis response capacity, among others  

The  resilience  of  Lithuania’s  health  system  is  expected  to  improve  as  a  result  of  the 
measures  proposed  in  the  component  on  health  (component  1).  Investments  in  infectious 
disease clusters and seven regional emergency and reanimation divisions should allow efficient 
treatment  of  a  large  number  of  patients  at  the  same  time,  improving  the  responsiveness  of  the 
system  to  potential  shocks.  Lithuania  also  plans  to  invest  in  digital  tools  enabling  alternative 
ways  of  providing  healthcare  and  better  management  of  epidemiological  surveillance.  In 
addition, the RRF should fund the creation of the competence platform to monitor and project the 
supply  and  demand  for  healthcare  professionals  and  skills,  and  supervise  compliance  with 
licensing conditions. 

The  component  on  public  sector  (component  6)  contains  a  civil  service  reform  which  is 
expected  to  increase  institutional  resilience.  Lithuania  intends  to  centralise  human  resource 
management in the public sector and enhance the development of mangers. In addition, the plan 
contains extensive training measures, especially concerning digital, strategic and leadership skills 
in  the  public  sector.  At  the  same  time,  such  institutions  as  the  State  Tax  Inspectorate  and  the 
Customs  Department  also  plan  specialised  training  for  their  staff  related  to  work  specific 
competences  (e.g.  customs  controls).  Such  planned  measures  contribute  to  strengthening  the 
capacity and resilience of the public administration that in return should improve the response to 
crisis, better support, policy development and implementation. 

29 

 
 
6th  pillar:  Policies  for  the  next  generation,  children  and  young  people,  such  as  education 
and skills  

Measures  aiming  at  ensuring  access  to  quality  of  education  across  schools  and  regions 
(component 4) contribute to creating the better prospects for the next generation. Reforms 
and  investments  are  notably  directed  to  improve  the  quality  and  efficiency  of  early  childhood 
education,  and  general  education  and  VET.  The  component  on  education  shall  support  the 
creation of an inclusive educational ecosystem with the so-called Millennium Schools at its core. 
In  addition,  the  plan  comprises  a  reform  on  establishing  a  lifelong  career  counselling  and 
planning system. It should help students identify and decide on possible career paths at an early 
age.  Children  should  gain  knowledge  of  competences  acquired  in  educational  institutions  and 
learn  about  the  transition  between  different  levels  of  education.  The  plan  also  envisages  a 
creation  of  an  additional  scheme  supporting  vocational  training  under  apprentice  programmes 
and  work-based  learning,  especially  in  the  small  and  medium-sized  enterprises,  as  well  as 
additional  incentives  for  pupils  to  take-up  VET  modules  early  in  the  secondary  school  and  a 
review of the content of VET programmes with  the aim to  better adapt  it to  the labour market 
needs, including twin transition. 

The  component  on  higher  education  and  innovation  (component  5)  aims  at  revising  the 
funding  of  higher  education  and  the  student  admission  system.  The  goal  is  to  encourage 
higher education institutions to prepare specialists needed in the labour market. The investments 
are  set  to  reduce  the  mismatch  between  the  current  qualification  of  recent  graduates  and  their 
employment. According to the plan, it is also envisaged to invest in the development of priority 
competences  relevant  to  future  economic  sectors  and  clarify  the  missions  and  quality 
requirements for universities and colleges. 

Taking into consideration all reforms and investments envisaged by Lithuania, its Recovery and 
Resilience plan represents, to a large extent a comprehensive and adequately balanced response 
to the economic and social situation, thereby contributing appropriately to all six pillars referred 
to in Article 3 of the RRF Regulation, taking the specific challenges and the financial allocation 
of Lithuania into account. This would warrant a rating of A under the assessment criterion 2.1 in 
Annex V to the RRF Regulation. 

4.2. Link with country-specific recommendations and the European Semester  

In  2019  and  2020,  Lithuania  received  country-specific  recommendations  to  improve tax 
compliance and broaden the tax base to sources less detrimental to growth, ensure the coverage 
and adequacy of the social safety net, and improve the effectiveness of the tax-benefit system in 
order  to  protect  against  poverty. Furthermore,  it  was  recommended  that  Lithuania  improve  the 
quality  and  efficiency  of  education  and  training,  and  address  issues  related  to  the  quality, 
affordability  and  efficiency  of  the  healthcare  system.  Lithuania  was  also  called  upon  to  focus 
investment  on  the  green  and  digital  transitions,  to  stimulate  productivity  growth,  to  develop  a 
coherent policy framework to support science-business cooperation, and to consolidate research 
and  innovation  implementing  agencies.  Finally,  Lithuania  was  invited  to  take  all  necessary 
measures  to  address  the  pandemic  effectively,  sustain  the  economy  and  support  the  ensuing 
recovery.  

All the broad policy areas relevant for the CSR – strengthening tax compliance, social safety net, 
health,  education  and  innovation  systems,  skills,  efficiency  of  the  public  sector,  as  well  as  the 

30 

 
 
twin  transitions  –  have  been  addressed  through  reform  and  investment  measures  to  varying 
degrees. 

Lithuania’s  RRP  puts  forward  measures  to  improve  tax  compliance  and broaden  the  tax 
base (CSR 1, 2019). Component 6 – Public sector aims to reduce the VAT gap and improve tax 
compliance by enhancing the capacity of the State Tax Inspectorate and the Lithuanian Customs 
to manage tax risks through legal and administrative measures, and preventing illegal activities, 
broadening sources of electronic taxpayer data, building on innovative data analytics, automating 
some tax administration procedures  and reducing public tolerance to  the  shadow economy  and 
tax  evasion.  In  addition,  the  component  envisages  investment  in  staff  competences  of  both  the 
State Tax Inspectorate and the Lithuania Customs. The component also envisages changes to the 
tax system, in particular concerning broadening the tax base and reducing inefficient tax breaks 
and exemptions.  

The  plan  proposes  measures  that  aim  to  strengthen  the  social  safety  net,  address  income 
inequalities  and  reduce  poverty  and  social  exclusion,  (CSR  1,  2019;  CSR  2,  2020). 
Component  7  –  Social  protection  includes  measures  aiming  at  assessing  the  minimum  income 
scheme in a holistic manner and identify pathways for its improvement. To this end, a minimum 
income  study  will  be  carried  out,  leading  to  recommendations  and  an  action  plan  for 
implementation. Based on the outcome of the study existing legislation will be amended (e.g. the 
Law  on  cash  social  assistance,  the  Law  on  the  determination  of  reference  indicators  of  social 
security  benefits  and  the  basic  amount  of  penalties  as  well  as  the  Law  on  social  insurance  for 
sickness  and  maternity).  In  addition  to  that,  a  reform  to  increase  the  effectiveness  of  personal 
income taxation and social insurance contributions in reducing poverty and income inequality is 
envisaged  under  the  Component  6  –  Public  Sector.  Lithuania  also  committed  to  increase  the 
coverage of unemployment insurance scheme, to introduce an additional benefit to single elderly 
and  disabled  people  and  to  improve  the  pension  indexation  mechanism.  Finally,  in  order  to 
increase the quality and accessibility of social  care services, Lithuania will introduce a scheme 
concerning  the  accreditation  of  social  care  institutions  with  the  aim  that  only  accredited 
institutions provide social care as of 1 January 2022. The measures are expected to address some 
of  the  long-standing  challenges  related  to  social  exclusion,  poverty  and  income  inequality  and 
improve social welfare of the most vulnerable groups. 

Some further steps are expected to be taken to address the challenges related to the impact 
of the crisis on employment and active labour market policies (CSR 2, 2020). In particular, 
Component  7  –  Social  protection  includes  measures  to  optimise  and  improve  the  employment 
service’s operational processes, ensuring systematic customer orientation as well as to increase 
the scope and diversity of employment support measures, contributing to the objectives of digital 
and  green  transformation  and  promoting  the  circular  economy.  Overall,  the  implementation  of 
the Plan is expected to directly contribute to alleviating the negative impact of the pandemic on 
the labour market. In the short and medium term, the measures planned under the Component 2 – 
Green  transition  and  Component  3  –  Digital  transition  are  expected  to  have  the  greatest 
economic impact on alleviating the effects of the crisis. 

Lithuania’s  plan  includes  measures  to  strengthen  the  resilience  of  the  health  system,  to 
improve  the  accessibility  and  quality  of  health  services  (CSR  1,  2020)  and  increase  the 
quality, affordability and efficiency of the healthcare system (CSR 2, 2019). As the pandemic 
has  revealed  the  vulnerability  of  the  health  system,  the  RRP  includes  investments  and  reforms 

31 

 
 
aiming at improving the quality and accessibility of health care, enhancing the sustainability and 
resilience  of  the  health  system  to  shocks  and  enabling  a  more  flexible  response  to  changing 
environmental factors and demographics. In this regard, Component 1 - Health includes reforms 
that aim to develop new models of regional cooperation between healthcare institutions, develop 
a  model  and  incentives  for  the  deployment  of  a  more  efficient  hospital’s  network,  strengthen 
primary care, scale up prevention measures, improve well-being, working conditions and skills 
of  healthcare  workers.  It  is  important  to  ensure  that  measures  to  improve  primary  care  and 
scaling  up  of  preventive  measures  are  implemented  with  the  necessary  resources  as  their 
implementation is expected to be supported by other funding sources. Increasing the efficiency 
of  the  health  system  is  expected  to  be  addressed  by  reforms  and  investments  focusing  on  the 
digitalisation of sector. Furthermore, the component includes reforms and investments to prepare 
the  long-term  care  sector  for  an  ageing  population.  A  one-stop-shop  for  the  organisation, 
delivery  and  financing  of  long-term  care  services  (care  and  social  care)  is  expected  to  be 
developed to reduce the number of avoidable hospitalisations. The component includes reforms 
and  investments  in  organisation  of  emergency  and  ambulance  services  to  ensure  that  the 
necessary assistance reaches the population in a timely manner. They should enable modernising 
the infrastructure of individual health facilities to adapt work in emergency and crisis situations. 
In  order  to  effectively  address  the  challenges  in  the  healthcare  system,  further  policy  efforts 
should ensure that the health  model provides sufficient  coverage for people’s  needs  and health 
problems, and addressing problems caused by inequality and structural underinvestment.  

Reforms and investments in the field of education aim to improve the quality and efficiency 
of all levels of education and training, and promote skills development (CSR 2, 2019; CSR 
2,  2020).  Component  4  -  Education  includes  measures  to  promote  quality  and  modern  early 
childhood  and  general  education,  including  by  strengthening  the  competences  of  teachers  and 
school  leaders  and  the  development  of  a  STEAM  education  ecosystem.  Furthermore,  the 
component aims to ensure that adults have the opportunity to develop competences in line with 
the  needs  of  the  economy  and  the  labour  market  via  a  national,  advanced  technology  and 
innovation-based  lifelong  learning  system  operating  on  the  principle  of  individual  learning 
accounts. The plan also includes policies to enhance the coherence between the education system 
and the labour market by strengthening the vocational education and training system and lifelong 
career  guidance. The component also  includes investments  for the development  of a model for 
the  functioning  and  governance  of  the  lifelong  learning  framework  and  investments  to  fund 
individual learning accounts for relevant target groups. In addition, measures aim to develop and 
update  the  content  of  vocational  education  and  training  programs,  to  support  work-based 
learning  via  apprenticeships,  facilitate  the  take-up  of  VET  modules  in  secondary  schools  and 
mobility of VET students, as well as expand a career planning and guidance system to schools. 
The  plan  also  envisages  the  development  of  a  Millennium  School  Network  (improvement  and 
consolidation of existing educational infrastructure). In addition to these measures, the content of 
early childhood education will be up-to-dated, to respond to the latest scientific knowledge about 
the needs of the youngest children.  

In  the  field  of  higher  education  and  innovation,  several  measures  support  innovation, 
science-business  cooperation,  and  promote  quality  and  efficiency  in  the  higher  education 
sector  (CSR2,  2019;  CSR  3,  2019;  CSR  3,  2020).  Component  5  –  Higher  education  and 
innovation includes measures to consolidate existing innovation promotion functions in a single 
innovation agency and make R&I policy framework more coherent. To further stimulate demand 

32 

 
 
for  innovation,  public  procurement  will  be  exploited  for  green  innovation.  Measures  will  also 
support joint business-science missions focused on innovation and R&I activities. With regard to 
higher education, the component envisages reforms in the student admission and funding system 
for  higher  education  institutions  in  order  to  strengthen  their  focus  on  quality,  foster  their 
international  competitiveness,  increase  the  volume  and  quality  of  R&D  activities,  and  increase 
the  attractiveness  of  the  researcher  career.  A  special  funding  scheme  will  be  created  to 
incentivise the consolidation in the higher education sector. The component is expected to lead to 
the revision of the study programmes with the aim to reduce duplications, train professionals in 
areas with labour market shortages as well as ensure access to higher education for people facing 
social exclusion and disabilities. During the implementation of the plan, sectoral support for the 
design,  implementation  and  evaluation  of  research  and  innovation  policy  reforms  will  be 
available via the Horizon Policy Support Facility. 

The  measures  in  the  plan  contribute  to  the  green  transition  by  fostering  energy  and 
resource efficiency, sustainable transport, energy interconnections and promoting a clean 
and efficient energy production (CSR 3, 2019; CSR 3, 2020). Component 2 – Green transition 
includes reforms and investments that are expected to provide a significant boost to Lithuania’s 
path towards a climate-neutral economy. The energy reform for sustainable electricity production 
is welcome as it is expected to improve the institutional and legal mechanisms to encourage the 
production, transmission and consumption of electricity from renewable sources. The plan also 
includes  measures  to  finance  preparatory  work  for  the  development  of  wind  farms  and  related 
infrastructure  in  the  Baltic  Sea,  investment  support  for  renewable  energy  generation  capacity 
(solar  and  wind  onshore)  and  individual  storage  facilities.  In  addition,  new  electricity  storage 
infrastructure  with  a  combined  capacity  of  200  MW  will  be  developed  to  ensure  the  national 
energy security needs as well as facilitating the integration of renewable electricity in the system 
in the medium term. The regional dimension will be targeted by one flagship energy community 
project to improve the socio-economic environment in the  Ignalina Nuclear Power Plant (IAE) 
region by installing new solar power generation capacity.  

Furthermore, the plan puts forward reforms and investments aiming at reducing GHG emissions 
by phasing out the most polluting road transport vehicles in cities and regions and increasing the 
share of renewable energy sources in the transport sector. It provides support to businesses and 
the public sector by  promoting zero and low-emission  vehicles, with  the aim of improving  the 
quality  and  attractiveness  of  public  transport  services  as  well  as  measures  to  promote  the 
development  of  infrastructure  for  the  production  of  alternative  fuels  as  well  as  charging/filling 
infrastructure  for  all  types  of  clean  vehicles  with  alternative  fuels  will  contribute  to  the 
promotion  of  sustainable  transport.  The  plan  includes  the  creation  of  a  Sustainable  Mobility 
Fund, the designation of low-emission municipalities, as well as tax incentives for less polluting 
road transport, promotion of green procurement in the transport sector, and the development of 
“e-tolling“  toll  system  among  other  measures.  All  these  measures  will  contribute  to  GHG 
emission  reduction  from  transport.  However,  in  order  for  these  measures  to  fully  contribute  to 
the  green  transition  of  transport  in  Lithuania  and  to  better  address  its  connectivity  needs,  a 
stronger  emphasis  on  rail  transport  would  be  needed.  In  particular  this  concerns  measures  to 
boost  the  uptake  of  rail  transport,  including  the  implementation  of  Rail  Baltica,  as  a  key  EU 
cross-border project, and focus on multimodality for passenger transport, with a special attention 
to  integrating  rail  within  the  urban  transport  system,  for  example  through  multimodal  travel 
hubs. 

33 

 
 
Finally,  the  plan  includes  reforms  and  investments  to  optimise  the  administration  and 
management  of  renovation  projects,  with  a  target  to  increase  energy  efficiency  and  start  a 
renovation wave in  Lithuania to  ensure that 1 000 multi-apartment  buildings are  renovated per 
year.  In  order  to  promote  resource  efficiency,  the  RRP  envisages  the  preparation  of  an  action 
plan by 2023 for Lithuania’s transition to a circular economy by 2035.  

Lithuania’s RRP promotes investment in the digital transition, in particular the coverage 
and  take-up  of  high  capacity  broadband,  and  addressing  challenges  in  the  urban-rural 
digital divide, digital skills, and the digitalisation of the economy (CSR 3, 2020). Component 
3 – Digital  transition  includes measures to  improve digital  connectivity  with  the aim to  put  in 
place  50  towers  and  2000km  of  fibre  infrastructure  in  market  failure  areas  as  well  as  provide 
access  to  Gigabit  speed  broadband  for  5000  digitally  intensive  enterprises/institutions.  In 
addition,  the  plan  includes  measures  to  facilitate  the  5G  rollout,  notably  in  international  land 
transport corridors (Via Baltica, Rail Baltica) and other trunk roads and railway lines of national 
significance,  airports  and  seaports.  The  promotion  of  digital  skills  are  envisaged  for  children, 
employees and senior citizen as well as measures to address the shortage of IT employees in the 
labour  market.  Furthermore,  the  plan  puts  forward  investments  to  promote  the  take-up  of 
advanced  digital  technologies  in  the  private  sector,  particularly  regarding  science-business 
cooperation for innovative technologies and the digitalisation of the cultural sector. Last but not 
least, the RRP includes substantial reforms and investments aiming to digitalise the public sector 
by (i) fully consolidating state information resources, IT infrastructure and services, (ii) ensuring 
the availability of reliable public sector data and the possibility to share it across sectors; and (iii) 
fully  digitalising  government  processes  and  expand  digital  public  services,  while  ensuring  that 
all public services are accessible for citizens with disabilities. 

The  plan  is  expected  to  contribute  to  boosting  productivity  growth,  including  by  making 
public  investment  more  efficient  (CSR  3,  2019).  In  particular,  Component  6  -  Public  sector 
includes a reform to increase the efficiency of public investment by enhancing the medium-term 
planning of state and municipal  budgets  and increasing the transparency of budget  amendment 
rules.  In  addition,  Component  3  –  Digital  transition  includes  measures  pushing  for  the 
digitalisation  of  the  public  sector  which  are  expected  to  have  a  lasting  positive  impact  on  the 
functioning  of  the  public  administration  and  its  productivity.  Finally,  Component  2  -  Green 
addresses  measures  stimulating  productivity  growth  by  improving  the  efficiency  of  public 
investment by exploiting the potential of innovative and green public procurement.  

The  recovery  and  resilience  plan  represents  to  a  large  extent  a  comprehensive  and 
adequate response to the economic situation of Lithuania. Continued convergence remains of 
significant importance to Lithuania, especially in terms of regional disparities, lack of a skilled 
workforce,  low  investment  in  R&D,  and  difficulties  in  attracting  foreign  direct  investment. 
Reforms  and  investments  are  needed  to  diversify  the  economy  and  make  it  more  modern  and 
competitive,  including  by  strengthening  investment  in  human  capital,  research  and  innovation, 
and  to  alleviate  the  socio-economic  costs  of  the  twin  transitions.  The  plan  provides  a 
comprehensive response to these challenges, but in some areas a holistic approach and continued 
ambitious  reform  effort  will  be  required  to  effectively  address  them.  Lithuania’s  business 
environment  is  expected  to  be  improved  through  reforms  and  investments  aimed  at  improving 
tax collection, the efficiency of the tax system and digitalising the public sector. The plan aims to 
improve  the  quality  of  education  at  all  levels  and  the  participation  in  adult  learning  for  better 
skills  management.  The  higher  education  system  will  be  reformed  to  increase  students’ 

34 

 
 
admission  standards  and  better  respond  to  the  demand  for  workers  and  skills  in  the  labour 
market. The consolidation of agencies responsible for innovation promotion is expected to make 
research  and innovation  policies more  efficient.  High  risks of poverty  and social  exclusion are 
addressed  through  reforms  to  improve  the  adequacy  of  the  minimum  income  support  and 
redistributive power of the tax-benefit system, improvements in long-term care, and the quality 
and accessibility of the healthcare system. Policies to support the country’s digital transformation 
and green transition to some extent take into account the significant regional disparities. Overall, 
implementation of the reforms and investment in the plan would ensure a significant boost to the 
growth potential of the Lithuanian economy in a sustainable manner. 

Overall, the plan addresses Lithuania’s main identified challenges, stimulating the recovery 
from the Covid-19 crisis and laying the foundation for its long-term growth. The challenges 
underlined  in  the  most  recent  country-specific  recommendations  are  related  to  the  twin 
transitions,  social  inclusion,  healthcare,  education,  innovation  and  science  and  taxation. 
Measures  envisaged  in  the  plan  are  expected  to  bring  structural  change  in  these  areas  and 
increase the participation and financing of private agents. Lithuania’s plan proposes a balanced 
and adequate response to the economic and social situation.  

Taking into consideration the reforms and investments envisaged by Lithuania, its recovery and 
resilience  plan  is  expected  to  contribute  to  effectively  addressing  to  varying  degrees  all  of  the 
challenges  identified  in  the  country-specific  recommendations,  or  challenges  in  other  relevant 
documents officially adopted by the Commission under the European Semester, and the recovery 
and  resilience  plan  represents  an  adequate  response  to  the  economic  and  social  situation  of 
Lithuania. This would warrant a rating of A under the assessment criterion 2.2 in Annex V to the 
RRF Regulation. 

35 

 
 
 
Table 5. Mapping of country challenges identified in 2019-20 country-specific recommendations and the Lithuania’s RRP 
components 

Country challenges 

(as identified in Section 2) 

Improve tax compliance 

Broaden tax base 

Associated CSR 
(2019-2020) and 
European Semester 
recommendations 

Public Finances 

CSR.2019.1.1;  

CSR.2019.1.2; 

Healthcare  

Increase the quality, affordability and efficiency of the 
healthcare system 

Strengthen the resilience of the health system, including by 
mobilising adequate funding and addressing shortages in 
the health workforce and of critical medical products 

CSR.2019.2.2; 
CSR.2019.2.3; 
CSR.2019.2.4; 
CSR.2020.1.3 

CSR.2020.1.2 

Education 

d
n
a
n
o
i
t
a
v
o
n
n
I

:
5
t
n
e
n
o
p
m
o
C

e
c
n
e
i
c
S

n
o
i
t
a
c
u
d
E

:
4
t
n
e
n
o
p
m
o
C

l
a
t
i
g
i
D

:
3
t
n
e
n
o
p
m
o
C

n
o
i
t
i
s
n
a
r
t

s
e
i
c
i
l
o
p
l
a
i
c
o
S
:
7
t
n
e
n
o
p
m
o
C

r
o
t
c
e
s

c
i
l
b
u
P
:
6
t
n
e
n
o
p
m
o
C

● 

● 

n
e
e
r
G

:
2
t
n
e
n
o
p
m
o
C

n
o
i
t
i
s
n
a
r
t

○ 

e
r
a
c
h
t
l
a
e
H

:
1
t
n
e
n
o
p
m
o
C

○ 

● 

Improve the quality and efficiency at all education and 
training levels, including adult learning 

CSR.2019.2.1; 

○ 

● 

○ 

36 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Promote skills, including digital skills 

CSR.2020.2.3 

Social 

○ 

● 

○ 

○ 

Ensure the coverage and adequacy of the social safety net 
and improve the effectiveness of the tax and benefit system 
to protect against poverty 

CSR.2019.1.3; 
CSR.2020.2.4 

Labour 

Mitigate the impact of the crisis on employment 

CSR.2020.2.1 

○ 

○ 

Increase the funding and coverage of active labour market 
policy measures 

CSR.2020.2.2 

Research and innovation 

Focus investment-related economic policy on innovation 

CSR.2019.3.1 

Develop a coherent policy framework to support science-
business cooperation and consolidate research and 
innovation implementing agencies 

Promote technological innovation in small and medium-
sized enterprises 

CSR.2019.3.7; 
CSR.2019.3.8 

CSR.2020.3.7 

Investment 

Digital transition, in particular on the coverage and take-
up of very high-capacity broadband 

CSR.2020.3.4 

○ 

Energy and resource efficiency and energy 
interconnections 

Clean and efficient production and use of energy 

CSR.2019.3.2; 
CSR.2019.3.3; 
CSR.2019.3.5  

CSR.2020.3.5;  

37 

○ 

○ 

● 

○ 

● 

● 

○ 

● 

● 

● 

● 

● 

○ 

○ 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainable transport 

CSR.2019.3.4; 
CSR.2020.3.6 

● 

Public administration and business climate 

Stimulate productivity growth by improving the efficiency 
of public investment 

CSR.2019.3.6 

○ 

● 

Key: “●” investments and reforms of the component significantly address the challenge; “○” the component partially addresses the 
challenge 

38 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
4.3. Growth  potential,  job  creation,  economic,  institutional  and  social  resilience, 
European  Pillar  of  Social  Rights,  mitigating  the  impact  of  the  crisis,  and  social 
territorial cohesion and convergence  

Fostering economic growth and jobs 

The  plan  is  estimated  to  have  a  positive  long-term  impact  on  Lithuania’s  economic 
performance. The Commission’s own estimates  indicate a GDP effect  of up to  1.6% by 2026 
(see  box  2).  Similarly,  the  micro-simulation  macro-econometric  model  used  by  the  authorities 
estimates an improvement  of the GDP figures  compared to  the baseline  scenario that is  1.53% 
greater in the short-term (2 years), 1.69% in the medium-term (5 years) and 0.73% in the long-
term (20 years) annually. This is expected to result in an expected GDP growth of 2.6 % in 2021, 
followed  by  an  acceleration  of  the  recovery  in  the  ‘outer  years’,  with  an  average  yearly  GDP 
growth  of  3.2%.  As  a  result,  over  the  period  2021-2026,  the  implementation  of  the  plan’s 
measures  is  projected  to  lift  GDP  cumulatively  by  around  9%  (based  on  a  relatively 
optimistically assumed multiplier effect of 1.9). In this respect the Lithuanian plan alludes to the 
effect  of  convergence  theory  –  economies  with  a  lower  level  of  development  grow  faster  than 
more developed economies – justifying the high rate of growth relative to the EU average. The 
plan is estimated to have a positive impact on employment of 0.97% in the short-term, 1.61% in 
the medium-term, and 1.81% in the long-term, whereas the unemployment rate (8.5% in 2020) is 
expected to be 2 percentage points lower in the medium-term and 1.9 percentage points lower in 
the  long-term  (compared  to  the  baseline).  The  short-term  impact  of  the  plan  is  expected  to  be 
driven by investment and long-term innovation, improving educational performance; expanding 
Active  Labour  Market  Policies  measures;  and  decreasing  energy  imports  as  a  result  of 
implemented  energy  efficiency  measures.  Overall,  the  plan’s  quantitative  assessment  of  its 
economic and employment impact is plausible. 

Lithuania’s  fiscal  figures  suggest  macro-additionality  of  the  expenditure  financed  under 
the  plan.  The  average  growth-enhancing  expenditure  level  (excluding  RRF  non-repayable 
financial support) in the three years prior to the pandemic crisis (2017-19) was 1.48% of GDP. 
The nominal level of expenditure had a growth trend smaller to the level of GDP, thus showing a 
ratio marginally decreasing with time. The planned average over the projection period of 2020-
2026 is 1.52% of GDP, with a considerable frontloading of the investments in 2020-21. By 2023, 
the ratio follows an increasing trend, showing Lithuania’s propensity to commit to medium-to-
long-term  investments.  Overall,  the  plan  does  not  seem  to  crowd-out  public  investments, 
implying  macro-additionality.  Furthermore,  the  plan  acknowledges  that  Lithuanian  public 
investment is insufficient and highly dependent on EU funding, thus explaining the low level of 
public investment in areas covered by EU funds. 

The plan is expected to have a significant short-to-medium term impact on labour market 
indicators,  education,  poverty,  income  inequality,  and  environmental  indicators.  Thus,  it 
contributes  to  the  implementation  of  the  European  Pillar  of  Social  Rights  and  climate  change. 
Under the component on social protection, Lithuania will facilitate the ability to take up and stay 
in employment via acquisition of competences in high value-added areas and the transition of the 
unemployed  into  employment  in  the  areas  of  green  and  digital.  In  the  long-run,  a  focus  on 
training  the  next  generation  of  youth  will  improve  education  and  labour  market  indicators.  In 
2025, Lithuania expects a decrease in the poverty and inequality indicators, with a decrease of 1  
percentage points of the population ‘at-risk-of-poverty’, 0.3 percentage points in ‘severe material 

39 

 
 
deprivation’,  and  0.1    percentage  points  in  the  ‘income  distribution  coefficient  s80/s20’.  This 
decrease  is  said  to  persist  in  2040,  with  a  poverty  rate  reduced  by  1.3  percentage  points 
(compared  to  the  baseline).  The  plan  justifies  those  improvements  with  short-and-long-term 
efforts,  such  as:  investment  in  active  labour  market  policies  in  the  component  ‘More 
opportunities for everyone to actively create prosperity’; an increase in universal benefits for all 
single-person  beneficiaries;  as  well  as  an  increase  in  the  coverage  of  the  unemployment  social 
insurance system. The long-term impact is expected to be reinforced by the reforms planned in 
the “Efficient public sector and preconditions to recover after the pandemic” component, which 
will reduce the VAT gap and collect additional funds into the public budget, which could be used 
to  finance  social  spending.  However,  the  impact  of  the  plan  on  territorial  cohesion  was  not 
quantified,  but  a  qualitative  analysis  suggests  an  indirect  impact  on  the  reduction  of  socio-
economic  disparities  between  Lithuanian  regions.  Overall,  the  measures  in  the  plan  suggest  an 
improvement in economic cohesion in an inclusive manner. 

Sustainable  and  growth-enhancing  reforms  and  investments  to  address  the  structural 
weaknesses of the country’s economy is expected to contribute to enhanced resilience and 
productivity.  The  pandemic  crisis  has  exposed  health  system  vulnerabilities  and  under-
preparedness  for  emergencies.  As  such,  the  plan  is  expected  to  allocate  12%  of  the  RRF 
envelope  (EUR  268  million)  towards  the  health  system,  with  most  of  it  (EUR  152  million) 
dedicated  to  the  emergency  adaptation  of  the  cluster  on  infectious  diseases  in  5  cities,  and  the 
reception  units  of  10  regional  hospitals.  Following  the  contraction  of  the  Lithuanian  labour 
market and economic performance, the plan aims to make use of the measures planned under the 
‘Green  transformation  of  Lithuania’  (37.8%  of  the  envelope  –  820.1  million)  and  ‘Digital 
transformation  for  growth’  (20%  of  the  envelope  –  445  million)  to  recover  and  propel  the 
economy  in  the  short-and-medium-term.  These  measures  alone  would  boost  Lithuania’s  GDP 
growth by 0.75  % in  the short-term  and would later  average 0.8 % over  the projection period. 
This would also have an estimated positive impact on employment – with 0.27  percentage points 
and 0.28  percentage points in the short- (2 years) and medium-term (5 years), respectively. The 
plan further addresses the importance of the component on education as well as the component 
on  higher  education  and  innovation,  to  promote  economic  transformation  and  growth  in  the 
medium and long term. As such, 14% (EUR 311 million) and 9% (EUR 200 million) of the RRF 
budget  has  been  attributed  to  the  reforms  of  each  of  the  two  components  respectively. 
Furthermore,  in  an  effort  to  reduce  social  inequalities,  Lithuania  has  planned  a  reform  on 
‘guaranteed  minimum  income  protection’  to  assess  and  reform  its  minimum  income  scheme. 
However,  the  positive  impact  of  such  measure  will  depend  on  the  concrete  solutions  proposed 
and  their  effective  implementation.  Overall,  the  measures  suggested  in  the  Lithuanian  plan  do 
address the weaknesses of its economy. 

The components on green, digital transition and education will serve as an opportunity for 
job  creation,  economic  competitiveness  and  sustainable  long-term  growth.  Lithuania’s 
economic  and  labour  market  performance  improved  before  the  pandemic.  The  rapid  economic 
growth  helped  to  reduce  the  overall  and  long-term  unemployment  rates,  while  the  share  of  its 
economically  active  population  and  employment  were  at  a  historically  high  level.  The  RRP 
provides an opportunity for Lithuania to reform its economy around three components (i.e. green 
transition,  digital  transition,  and  education)  and  increase  its  competitiveness.  Under  the 
component on green transition, Lithuania pledges to reduce its dependence on foreign and non-
renewable  energy  and  create  the  necessary  framework  and  infrastructure.  The  digitalisation  of 

40 

 
 
the  public  sector,  the  economy,  and  academia  is  said  to  make  the  economy  more  resilient  to 
potential  shocks,  using  digital  competitiveness  as  a  key  driver  of  economic  recovery,  while 
investments and reforms in the education system will most likely drive Lithuania’s labour market 
competitiveness in the long-run. Overall, the plan fosters job creation, while boosting the growth 
potential  of  the  economy.  At  the  same  time,  the  social  protection  and  health  components  are 
expected to strengthen growth inclusiveness and sustainability. The impact of these measures is 
expected to be reinforced by reforms planned in the public sector, notably in terms of improved 
budgetary framework, better tax collection and public sector efficiency. 

Box 2: Stylised NextGenerationEU impact simulations with QUEST – Lithuania 

Model simulations conducted by the Commission using the QUEST model show that the 
economic impact of the NGEU in Lithuania could lead to an increase of GDP of between 
1.0% and 1.6% by 2026.[1] After 20 years, GDP could be 0.5% higher. Spillovers account 
for an important part of such impact.  
According  to  these  simulations,  this  would  translate  into  up  to  9,000  additional  jobs.  Cross 
border (GDP) spillovers account for 0.5 pps in 2026, showing the value added of synchronised 
expenditure  across  Member  States  (line  2).  Even  in  a  scenario  with  a  lower  productivity  of 
NGEU funds, it would still lead to a significant impact (line 3). [2] 

Table  1:  QUEST  simulation  results  (%-deviation  of  real  GDP  level  from  non-NGEU  case, 
linear disbursement assumption over 6 years) 
Scenario 

2021  2022  2023  2024  2025  2026  2027  2028  2029  2030  2040 

Baseline 

   of which spillover 

Low productivity 

0.9 

0.5 

0.6 

1.4 

0.5 

1.0 

1.3 

0.5 

0.9 

1.4 

0.5 

0.9 

1.5 

0.5 

0.9 

1.6 

0.5 

1.0 

1.2 

0.4 

0.6 

0.9 

0.3 

0.2 

0.9 

0.2 

0.3 

0.9 

0.2 

0.3 

0.5 

0.1 

0.2 

This stylised scenario does not include the possible positive impact of structural reforms, 
which  can  be  substantial.  A  model-based  benchmarking  exercise  shows  that  undertaking 
structural  reforms  that  would  result  in  halving  the  gap  vis-à-vis  best  performers  in  terms  of 
indicators of structural reforms could raise Lithuania GDP by 8% in 20 years time. [3] 
Due  to  the  differences  in  the  assumptions  and  methodology,  the  results  of  this  stylised 
assessment  cannot  be  directly  compared  to  the  numbers  reported  in  chapter  4  of 
Lithuania’s RRP.  

[1] RRF amounts to roughly 90% of NGEU, which also includes ReactEU, Horizon Europe, InvestEU, JTF, Rural 
Development and RescEU. 
[2] Technically, the low productivity scenario considers a significantly reduced output elasticity of public capital. 
[3] Varga, J, in 't Veld J. (2014), “The potential growth impact of structural reforms in the EU: a benchmarking 
exercise ", European Economy Economic Papers no. 541.  
http://ec.europa.eu/economy_finance/publications/economic_paper/2014/pdf/ecp541_en.pdf.  

41 

 
 
 
  
  
 
 
 
 
Strengthening social cohesion 

The  RRP  measures  directly  aimed  at  strengthening  social  cohesion,  and  the  social 
protection system are presented in the component on social protection and on public sector. 
The  plan  envisages,  inter  alia,  a  measure  to  improve  pension  indexation,  introduction  of 
additional  single  person  benefits,  improving  the  coverage  and  adequacy  of  unemployment 
benefits,  and  increasing  minimum  maternity  and  sickness  benefits.  All  these  measures  directly 
target  socially  vulnerable  groups  at  risk  of  poverty  or  social  exclusion,  and  should  have  a 
positive  impact  on  poverty  and  income  inequality  indicators.  They  will  also  contribute  to 
principles 12-15 of the European Pillar of Social Rights In addition, Lithuania intends to reform 
the minimum income system and to increase the effectiveness of personal income taxation and 
social  insurance  contributions  in  reducing  poverty  and  income  inequality  (in  the  Public  Sector 
component),  both  on 
the  comprehensive  analytical  expert  studies.  The 
recommendations of these studies would be reflected in the follow-up changes in the legal acts. 
If implemented, these reforms would have a positive impact on the Social Scoreboard indicators 
related to poverty and income inequality,  

the  basis  of 

The  measures  of  the  component  on  social  protection  are  expected  to  improve  labour 
market performance and help to alleviate poverty. They will expand the coverage and types 
of  the  active  labour  market  policy  measures,  facilitate  the  acquisition  of  competences  in  high 
value-added areas and the transition  of the unemployed into employment in  the  areas  of  green 
and  digital.  As  the  unemployed  are  one  of  the  most  deprived  groups  in  Lithuania,  these 
employment support measures are expected to contribute to alleviating poverty, reducing income 
inequality and to implementing the principles 1 and 4 of the European Pillar of Social Rights.  

 Measures are included in the component on education to support employment. They aim at 
improving  the  participation  in  adult  learning,  as  well  as  enhancing  the  professional  guidance 
system  and  boosting  the  participation  in  vocational  education  and  training  (VET)  via  various 
measures, including the modernisation of the content of the VET and programs and modules, as 
the component addresses the needs and imbalances of the labour market, including the mismatch 
of skills. The reorganisation of school network through the “Millennium schools” project and the 
measures envisaged at pre-school level and for teachers could help Lithuania tackle urban-rural 
gaps  in  access  to  quality  education  and  in  student  outcomes  by  also  better  addressing  pupils’ 
learning needs. This is expected to improve equity in education in the long-term mitigating the 
impact  of  socio-economic  background  on  education  and  contributing  to  social  cohesion. 
Measures in the other components that aim to increase accessibility of people with disabilities to 
the  higher  education  system  and  public  services,  as  well  as  improving  general  accessibility  of 
long-term care, also contribute to strengthening social cohesion. 

Lithuania  also  foresees  substantial  measures  to  strengthen  social  cohesion  financed  from 
European Structural and Investment Funds (ESIF). This is expected to include, in particular, 
the  areas  of  social  housing  and  inclusion  of  the  vulnerable  groups,  including  persons  with 
disabilities.  Robust  coordination  between  the  measures  funded  from  the  RRF,  ESIF  and  the 
national budget will be needed to achieve their full potential and to avoid double funding. In the 
light  of  the  above,  the  measures  foreseen  in  the  RRP  potentially  have  a  notable  impact  on 
strengthening  social  cohesion  and  social  protection  systems.  The  RRP  is  expected  to 
significantly  complement  Lithuania’s  efforts  between  2017  and  2019  that  have  already  led  to 
sizeable improvements in the relevant Social Scoreboard indicators. 

42 

 
 
The  plan  contains  some  measures  that  are  expected  to  contribute  to  addressing  the 
country’s  challenges  in  the  areas  of  gender  equality  and  equal  opportunities  for  all. 
Lithuania  states  that  all  reforms  and  investments  included  in  the  plan  are  designed  to  reduce 
existing  social,  economic  and  territorial  disparities.  As  regards  gender  equality,  gender 
mainstreaming has to be taken into account in the implementation phase in order to continuously 
monitor  impacts  for  women  or  men.  The  plan  also  aims  to  assess  possibilities  to  introduce  a 
gender equality dimension when designing state and municipal budgets.  

There  are  measures  in  the  plan  that  directly  and  indirectly  aim  to  address  the  needs  of 
persons  with  disabilities,  such  as facilitating  accessibility  to  buildings,  independent  use  of 
public services online and an increase in universal benefit for single persons with disability. 
Development  of  digital  skills  especially  for  vulnerable  groups  (persons  with  disabilities,  older 
persons, migrants and refugees) are included in the plan. The reform of long-term care provision 
is  planned  to  improve  the  possibility  for  working-age  carers,  most  of  whom  are  middle-aged 
women, to return to the labour market. Maximising synergies between the plan and the national 
equality  related  legislative  and  policy  actions  should  provide  a  comprehensive  response  to  the 
challenges identified. 

Reducing vulnerability and increasing resilience 

the  COVID-19  crisis  with  no 

Lithuania’s  economy  has  weathered  the  COVID-19  induced  economic  shock  better  than 
most EU Member States, as GDP fell relatively little thanks in particular to the resilience of 
its  exports.  In  addition,  Lithuania  entered 
identified 
macroeconomic imbalances, although the recent dynamics of the nominal unit labour cost index 
involve  some  risks.  Before  2020,  the  general  government  balance  was  in  surplus  despite  the 
VAT gap being one of the largest in the EU. The debt-to-GDP ratio was also well below the 60% 
threshold.  The  most  pertinent  challenge  for  Lithuania  is  contracting  labour  supply  due  to  the 
worsening  demographic  composition,  linked  to  ageing  net  emigration  and  a  relatively  low 
number of healthy living years. Furthermore, lack of skilled labour limits the economic growth 
potential. High poverty and income inequality are also persistent problems. The Plan envisages 
some measures that are expected to address those issues at least partially. 

Lithuania’s plan aims at increasing the resilience of the healthcare system by investing in 
competences of healthcare personnel and a modernisation of infectious disease clusters in 
five  major  cities.  At  the  regional  level,  seven  emergency  and  reanimation  and  intensive  care 
divisions  are  expected  to  be  modernised  with  a  view  to  efficiently  treat  a  large  number  of 
patients  at  the  same  time.  Overall,  these  investments  are  envisaged  to  ensure  affordable,  high-
quality  and  safe  diagnostic  and  treatment  services  for  the  Lithuanian  population.  The  plan 
includes  healthcare  workforce  reforms  to  address  shortages,  improve  well-being  and  working 
conditions  for  the  medical  staff  during  pandemics  and  normal  times.  In  addition,  the  plan 
envisages the creation of digital tools allowing to improve the management of epidemiological 
surveillance and data exchange as well as the provision of healthcare services electronically. 

The  plan’s  component  on  education  includes  reforms  to  address  gaps  in  educational 
achievements. The core element of this component is the Millennium Schools’ programme. It is 
set to encourage municipalities to consolidate educational resources and better allocated school 
funding.  It  should  enable  the  creation  of  an  inclusive  educational  ecosystem  beneficial  to  all 
schools  joining  the  network.  In  the  Plan,  it  is  also  envisaged  to  invest  in  the  development  of 
digital competences of teachers. This should enable them to better use digital content and tools 

43 

 
 
while  teaching.  Implementation  of  the  previously  mentioned  reforms,  including  the  curriculum 
reform  and  the  development  of  a  methodology  for  school  evaluations,  and  investments  are 
expected to ensure possibilities for all pupils to get good quality education and narrow the gaps 
in educational outcomes which are due to the socio-economic environment.  

Institutional resilience should be strengthened by the reform of the civil service. According 
to the Plan, changes to legislation, which are to be accompanied by corresponding investments in 
digital  tools,  should  improve  human  resource  management  and  staff  development,  especially 
what  concerns  digital,  strategic  and  leadership  skills  in  the  public  sector.  A  centralised 
mechanism for developing public sector managers is supposed to ensure an adequate supply of 
skilled  staff  corresponding  to  the  needs  of  the  state.  Overall,  these  measures  are  expected  to 
increase the quality of decision making in the public sector and strengthen customs orientation of 
civil servants. 

Planned improvements in the budgetary framework are expected to increase the stability 
and  transparency  of  public  finances.  The  Plan  comprises  three  very  important  reform  and 
investment  elements  in  this  respect.  First  of  all,  a  methodology  on  medium-term  budgetary 
planning should be adopted. It should contain, for example, clear rules on the calculation of basic 
expenses  and  expenditure  limits  for  appropriation  managers.  Furthermore,  amendments  to  the 
Law  on  the  Budget  Structure  should  clarify  amendment  procedures  of  annual  budgets,  which 
should  eliminate  unbudgeted  expenditures.  Another  important  pillar  is  spending  reviews.  The 
Recovery  and  Resilience  Facility  will  finance  a  comprehensive  review  planned  in  2023.  Its 
results are set to help reducing inefficient expenditures and channel public funds to where they 
could create higher added value.  

A  set  of  reforms  and  investments  designed  to  increase  tax  compliance  should  generate 
additional  budget  revenues  to  fund  social  and  other  policy  measures.  If  properly  designed 
and implemented, the legal measures included in the Plan are expected to limit the use of cash in 
certain risky economic sectors and (or) for some types of transactions, and in this way strengthen 
the  fight  against  the  shadow  economy.  Digitalisation  of  various  business  documents 
(consignment  notes,  receipts,  payment  data)  and  their  almost  immediate  availability  to  the  tax 
authorities  creates  opportunities  for  better  tax  compliance  monitoring  and  consequently  tax 
collection.  Envisaged  improvements  in  data  analytics  and  investments  in  staff  competences 
should enable the State Tax Inspectorate and the  Lithuania Customs to  better target  businesses 
that do not comply with tax and customs legislation. 

Economic resilience should be supported by increasing energy production from renewable 
resources and ensuring the energy security. The RRF may fund preparatory studies which are 
necessary to start developing a wind farm in the Baltic Sea. Investments will also be channelled 
to  encourage  individual  production  and  storage  of  energy  from  renewables  on  the  mainland. 
These  measures  should  help  Lithuania  to  achieve  the  goal  of  45%  share  of  RES  in  gross  final 
energy  consumption.  In  addition,  a  battery  park  of  200  MW  will  be  set  up  to  provide  the 
necessary  energy  reserve  and  facilitate  the  transition  period  before  Lithuania  synchronises  its 
electricity grid with continental Europe in 2025. 

Cohesion and convergence 

The  Lithuanian  plan  includes  promising  measures  to  help  tackle  economic  and  social 
inequalities  at  a  national  and  European  level,  thus  promoting  greater  cohesion  and 

44 

 
 
convergence.  Out of the seven components  of the plan, four are expected to  significantly help 
converge  towards  the  European  average,  while  three  are  expected  to  alleviate  the  disparities 
within the country. Substantive effort in  the  green component towards the circular  economy is 
said  to  improve  the  labour  market  conditions  through  the  creation  of  sustainable  jobs,  but  not 
necessarily lead to social cohesion. However, the plan suggests that the renovation funds should 
prioritise  restoring  low-income  regions,  thus  improving  the  poverty  rate,  which  is  amongst  the 
highest in the EU. Additionally, significant targeted investments are expected in Utena, fostering 
large  improvements  among  the  most  lagging  counties  in  Lithuania.  Further  investments  and 
reforms in digitalisation, education, social inclusion and ALMPs, as well as the public sector, are 
expected to improve the country’s competitiveness and improve the overall performance in terms 
of GDP per capita, poverty rate, and the labour market situation. However, the impact of the plan 
on  territorial  cohesion  was  not  quantified,  therefore  providing  little  evidence  on  the 
heterogeneous  impact  of  the  RRP.  A  qualitative  analysis  suggests  an  indirect  impact  on  the 
reduction of socio-economic disparities between  the  Lithuanian regions,  suggesting  an implicit 
improvement of the territorial cohesion. Furthermore, one should note that the aggregate positive 
impact of the plan on macro-economic variables is dependent on the successful implementation 
of all the reforms, as they are complementary, and the overall effect is greater than the sum of the 
effects of the individual reforms. 

Taking into consideration all reforms and investments envisaged by Lithuania, its recovery and 
resilience  plan  is  expected  to  have  a  high  impact  on  strengthening  the  growth  potential,  job 
creation, and economic, social and institutional resilience of the Member State, on contributing 
to the implementation of the European Pillar of Social Rights, including through the promotion 
of  policies  for  children  and  youth,  and  on  mitigating  the  economic  and  social  impact  of  the 
COVID-19  crisis,  thereby  enhancing  the  economic,  social  and  territorial  cohesion  and 
convergence within the Union. This would warrant a rating of A under the assessment criterion 
2.3 of Annex V to the RRF Regulation.  

45 

 
 
 
 
 Box 3: Employment and social challenges in light of the Social Scoreboard 
accompanying the European Pillar of Social Rights 

the  overall  employment 

The  Social  Scoreboard  supporting  the 
European Pillar of Social Rights points to a 
few  employment  and  social  challenges  in 
Lithuania. The COVID-19 crisis has slowed 
the  positive  economic  and  labour  market 
developments observed in the past years. The 
economic  contraction  contributed  to  a  steep 
rise in the unemployment rate (9.3% in Q3 of 
2020,  significantly  above  the  EU  average  of 
7.5%).  Young  people  and  women  were 
among those impacted the most. The share of 
long-term unemployed increased as well, but 
remained at the EU average of 2.5% in 2020. 
However, 
rate 
(70.7%  in  Q3  2020)  remains  above  the  EU 
average  in  the  same  period  (67.8%),  as  does 
the  economically  active 
the 
population.  Nevertheless,  disparities 
in 
employment  across  regions  and  skills  levels 
persist,  with  the  employment  rate  of  people 
with  less  than  primary  and  lower  secondary 
education 
the  EU 
significantly  below 
average.  Despite  the  rise  in  unemployment, 
the  gender  employment  gap  remains  one  of 
the lowest in the EU. Lithuania improved the 
percentage of children aged less than 3 years 
in  formal  childcare,  but  remains  below  the 
EU average. 
Although 
pandemic  was 

situation  before 
improving, 

share  of 

the 

the 
income 
inequality  and  the  risk  of  poverty  or  social  exclusion  remain  high,  particularly  for 
vulnerable  groups.  Despite  a  substantial  increase,  the  impact  of  social  transfers  (other  than 
pensions) on poverty reduction remains below the EU average in 2019, and the redistributive 
capacity  of  the  tax  and  benefit  system  remains  limited.  The  income  of  the  top  20%  of  the 
income distribution exceeds those of the bottom 20% by 6.4 times, which is among the highest 
in the EU and well above the EU average of 5.0.  
The early school-leaving rate remains among the lowest in the EU, although the share of 
the early school leavers increased in 2020. The strong performance is due to a combination 
of  measures  to  prevent  early  school  leaving,  intervene  in  case  of  risks,  or  compensate  the 
learning of pupils that did drop out. This helped to keep the share of young-people neither in 
employment,  nor  in  education  or  training  (NEET)  close  to  the  EU  average,  despite  a  sharp 
increase during the COVID-19 crisis.  
The Recovery and Resilience Plan submitted by Lithuania contains some labour market 

46 

Critical situationTo watchWeak but improvingGood but to monitorOn averageBest performersSocial Scoreboard for LITHUANIAEqual opportunities and access to the labour marketEarly leavers from education and training (% of population aged 18-24) (2020)Youth NEET (% of total population aged 15-24) (2020)Gender employment gap (2020)Income quintile ratio (S80/S20) (2019)At risk of poverty or social exclusion (in %) (2019)Dynamic labour markets and fair working conditionsEmployment rate (% population aged 20-64) (2020)Unemployment rate (% population aged 15-74) (2020)Long term unemployment (% population aged 15-74) (2020)GDHI per capita growth (2019)Net earnings of a full-time single worker earning AW (2019)Update of 29 April 2021. Members States are classified on the Social Scoreboard according to a statistical methodology agreed with the EMCO and SPC Committees. It looks jointly at levels and changes of the indicators in comparison with the respective EU averages and classifies Member States in seven categories. For methodological details, please consult the Joint Employment Report 2021; NEET: neither in employment nor in education and training; GDHI: gross disposable household income.Social protection and inclusionImpact of social transfers (other than pensions) on poverty reduction (2019)Children aged less than 3 years in formal childcare (2019)Self-reported unmet need for medical care (2019)Individuals' level of digital skills (2019)Better than average 
 
 
measures  relevant for the implementation of the Pillar. To foster  equal  opportunities and 
access  to  the  labour  market,  the  plan  envisages  a  new  one-stop  shop  platform  for  lifelong 
learning, based on individual learning accounts and reinforced by an improved career guidance 
system.  A  reform  of  the  vocational  education  and  training  is  also  envisaged,  including  the 
introduction  of  centres  of  vocational  excellence  and  a  National  Platform  for  the  Progress  of 
VET  that  brings  together  social  partners,  authorities,  VET  providers  and  other  stakeholders. 
The  digitalisation  of  public  employment  services  is  expected  to  free  the  human  resources 
needed  to  provide  more  individual  and  tailored  support  to  jobseekers.  The  proposed 
investments  on  entrepreneurship  support  in  twin  transition  areas,  and  on  reskilling  to  high 
value-added areas support the shift away from the crisis measures for the labour market, but 
their  implementation  will  need  to  be  monitored  to  ensure  impact  and  coherence  with  other 
national and EU funding sources. 
The Plan also introduces measures to address issues related to social protection, inclusion 
and health. Lithuania also plans putting in place some concrete measures to address poverty 
and income inequality, and envisages changes to the minimum income model and the taxation 
system.  Social  services  and  higher  education  will  be  made  more  accessible  for  persons  with 
disabilities  through  digital  solutions  tailored  to  their  specific  needs.  The  Plan  aims  to 
strengthen  the  quality  and  accessibility  of  health  services  through  digitalisation,  cooperation 
between hospitals, and stronger long-term care. 

4.4. The principle of ‘do no significant harm’  

Lithuania’s  recovery  and  resilience  plan  assesses  compliance  with  the  ‘do  no  significant 
harm’ (DNSH) principle. The assessment follows the methodology set out in the Commission’s 
technical  guidance  on  the  application  of  ‘do  no  significant  harm’  under  the  Recovery  and 
Resilience Facility Regulation (2021/C 58/01). It covers the six environmental objectives within 
the meaning of Article 17 of Regulation (EU) No 2020/852, namely climate change mitigation, 
climate change adaptation, sustainable use and protection of water and marine resources, circular 
economy,  pollution  prevention  and  control,  and  protection  and  restoration  of  biodiversity  and 
ecosystems.  The  environmental  impact  is  assessed  per  reform  or  investment.  Hence,  the  30 
measures (reforms and investments) in Lithuania’s recovery and resilience plan translate into 180 
‘do no significant harm’ assessments, based on the six objectives. 

Each  ‘do  no  significant  harm’  assessment  follows  a  two-step  approach.  The  first  step 
assesses whether there is a risk that a measure could do significant harm to one or more of the 
environmental  objectives.  In  some  cases,  the  assessment  concludes  that  there  is  no  risk  of 
significant harm, in  which case the measure is  assessed as compliant with this objective of the 
Regulation. In cases where the analysis identifies a risk, a more detailed assessment is performed 
in which Lithuania demonstrates the absence of significant harm. 

Where needed, the requirements of the DNSH assessment are enshrined in the design of a 
measure  and  specified  in  a  milestone  or  target  of  this  measure.  This  ensures  that  any 
disbursement  for  the  respective  measures  can  only  be  made  once  compliance  with  the  DNSH 
principle  is  ensured.  For  instance,  regarding  “Efficient  implementation  of  innovation  policy, 
increased  demand  for  innovation,  start-up  ecosystems  and  green  innovation  development” 
(COFOG  01.5)  measures,  the  DNSH  assessment  states  that  it  will  be  ensured  that  financial 
instruments are designed in such a way that activities do not adversely affect the climate change 

47 

 
 
 
mitigation  objective,  and  in  particular  that  the  contracts  and/or  other  documents  will  stipulate 
that the financial intermediary and the project promoter will ensure that investments will exclude 
sectors incompatible with DNSH. This is also integrated in the milestone of this measure. 

Lithuania’s recovery and resilience plan puts particular focus on sustainable mobility with 
a  reform  “On  the  Move  without  Emissions”.  This  notably  entails  support  to  develop 
renewable  fuels  sector  (biomethane,  second  generation  liquid  biofuels)  and  development  of 
filling  infrastructure  for  these  alternative  fuels.  These  investments  could  potentially  represent 
harm  to  several  environmental  objectives,  namely  climate  change  mitigation,  air  pollution  and 
biodiversity. This is expected to be prevented by the requirement that biomethane gas or biofuels 
are  produced  exclusively  from  waste  or  residues  (and  not  from  feed  stocks)  and  that  the  final 
production  complies  with  the  provisions  of  the  Renewable  Energy  Directive  2018/2001/EU 
(REDII),  and  related  implementing  and  delegated  acts.  The  producers  will  have  to  submit 
certificates  attesting  to  the  sustainability  of  their  production.  Furthermore,  Lithuania  provided 
assurances that exclusively RED II compliant biofuels, bio liquid and biomass fuels are used by 
the vehicles supported under the plan and that the mix of biofuels in the national fuel mix will 
increase over time, namely through the system of renewable fuel accounting units established by 
the Law on alternative fuels. 

Under the same reform, Lithuania will provide support to replace polluting road transport 
vehicles which could potentially represent harm to the objective of climate mitigation. This 
will be prevented by the requirement to support purchase only of zero emission (e.g. electric or 
hydrogen-powered) light duty vehicles, zero emission (e.g. electric or hydrogen) low-floor buses 
for  urban  or  suburban  passenger  transport,  high-floor  buses  powered  by  electric  power,  biogas 
produced from raw materials meeting RED II requirements and zero emission and low emission   
heavy  duty  vehicles  powered  by  electricity  or  biogas  produced  from  RED  II  compliant  feed 
stocks.  Potential  harm  to  the  objective  of  circular  economy  is  also  addressed  in  the  DNSH 
assessment, in particular by stating that a circular economy approach shall be complied with for 
the vehicles acquired under this reform, both during the use phase (maintenance) and at the end 
of their lifetime, including the reprocessing of batteries and electronics.  

The  plan  also  places  a  strong  focus  on  the  renovation  of  buildings.  This  is  mostly  under 
Reform  “Accelerating  renovation  of  buildings  and  a  sustainable  urban  environment”  of  Green 
transition  component,  but  also  under  measure  “Improving  the  quality  and  accessibility  of 
services and promoting innovation” of the Health component, measure “Modern pre-primary and 
general  education”  of  Education  component.  While  this  has  a  positive  impact  on  the  energy 
system as well as on emissions reductions, it can also create significant amounts of construction 
waste and hence cause harm to the circular economy objective. Lithuania ensures that there will 
be no significant harm to the circular economy objective by detailing in the plan for each of the 
measures that at least 70% (by weight) of the non-hazardous construction and demolition waste 
generated  on  the  construction  sites  will  be  prepared  for  reuse,  recycling  and  other  material 
recovery. Where a construction of new buildings is envisaged, it will be ensured that they meet 
all the EU legislation requirements to ensure that no harm to climate change mitigation is done, 
and  notably  that  they  will  be  Near  Zero  Energy  Buildings  (NZEB).  Finally,  in  order  to  ensure 
that the investment to promote a sustainable market for construction products and services under 
the measure “Faster renovation of buildings and a sustainable urban environment” does not cause 
harm to biodiversity, it will be ensured that raw materials will be sourced from forests managed 
sustainably and will not be sourced from protected natural areas. 

48 

 
 
Taking  into  consideration  the  assessment  of  all  the  measures  envisaged,  no  measure  for  the 
implementation  of  reforms  and  investments  projects  included  in  Lithuania’s  recovery  and 
resilience  plan  is  expected  to  do  a  significant  harm  to  environmental  objectives  within  the 
meaning  of  Article  17  of  Regulation  (EU)  No  2020/852  (the  principle  of  ‘do  no  significant 
harm’). This would warrant a rating of A under the assessment criterion 2.4 of Annex V to the 
RRF Regulation. 

4.5. Green transition  

Lithuania’s RRP correctly follows the methodology  for climate tracking set out in Annex 
VI of the RRF regulation. It identifies intervention fields and corresponding coefficients for the 
calculation of support to the climate objectives, for most measures. It should be noted that: 

 

the measures of the RRP often consist of several sub-measures – for these measures, the RRP 
indicates an intervention field for each sub-measure and computes the climate contribution at 
sub-measure  level.  The  total  number  of  measures  indicated  for  tagging  purposes  does 
however differ from the total number of measures as presented in the plan.  

  where  relevant,  milestones  and  targets  include  specifications  that  ensure  that  the 
requirements of an intervention field are met (for instance, where intervention field 025bis – 
“Energy  efficiency  renovation  of  existing  housing  stock,  demonstration  projects  and 
supporting measures compliant with energy efficiency criteria” is used, a target specifies that 
the measure must achieve the conditions of the tag i.e. on average, at least a medium-depth 
level  renovation as  defined in  Commission Recommendation on Building Renovation (EU) 
2019/786). 
the  choice  of  intervention  fields  for  the  climate  transition  is  well  justified  and  reflects  the 
nature, focus, objective or expected outcome of the investments. 

 

Measures  supporting  climate  change  objectives  in  Lithuania’s  recovery  and  resilience  plan 
account  for  EUR  841.2  million,  which  represents  37.8%  of  the  plan’s  total  allocation  of  EUR 
2.22  billion.  Of  the  7  components  in  the  plan,  4 components  (Green  transition,  Health,  Higher 
education  and  Innovation  and  Social  Protection)  include  expenditure  that  contribute  to  the 
climate objectives.  

With a total of EUR 820 million, the largest climate contribution of the recovery and resilience 
plan  results  from  Component  2  –  Green  devoted  to  green  transition.  This  component  notably 
includes  4  reforms  and  1  investment  and  accompanying  sub-measures:  on  renewable  energy 
(Reform  1),  sustainable  mobility  (Reform  2),  buildings  renovation  (Reform  3),  restoration  of 
degraded peatlands (Investment 4) and circular economy (Reform 5).   

The investments under Reform 1 include support for the preparatory works for the offshore wind 
development, construction of onshore RES plants (solar and wind), individual storage facilities 
and the establishment of renewable energy communities, and they benefit from a 100% climate 
tag  under  028  Renewable  energy:  wind  and  029  Renewable  energy:  solar.  Investment  in  other 
electricity  storage  facility  benefits  from  a  100%  climate  tag  033  Smart  Energy  Systems 
(including smart grids and ICT systems) and related storage.  

Under Reform 2 (“On the Move without Emissions”), investments aimed at replacing polluting 
road  transport  vehicles,  and  in  particular  those  that  support  purchase  of  zero  emission  light 

49 

 
 
 
vehicles and low and high-floor buses, and zero and low emission Heavy Duty Vehicles address 
the challenges identified in the country report for Lithuania related to sustainable mobility. 

According  to  Article  18(4),  point  (e)  of  the  RRF  Regulation,  the  methodology  for  climate 
tagging  set  out  in  Annex  VI  can  “be  used  accordingly  for  measures  that  cannot  be  directly 
assigned to an intervention field listed in Annex VI”. Therefore, the planned investments in zero-
emission  vehicles  should  benefit  from  a  100%  climate  tag,  similarly  to  that  under  074  Clean 
urban transport rolling stock. Support  for the development  of charging/filling infrastructure for 
all  types  of  clean  vehicles  using  alternative  fuels  benefits  from  a  100%  climate  tag  under  077 
Alternative fuels infrastructure. Finally, support to develop renewable fuels sector (biomethane, 
second  generation  liquid  biofuels  and  hydrogen)  qualify  for  100%  climate  tag  under  030bis 
Renewable energy: biomass with high GHG savings and 032 Other renewable energy (including 
geothermal energy).  

The investments under Reform 3 “Accelerating renovation of buildings and a sustainable urban 
environment”  benefit  from  a  100%  climate  tag  (025bis  and  026bis)  as  they  will  respect  the 
energy efficiency criteria of at least 30% primary energy savings and this level is guaranteed in 
their  respective  different  milestones  and  target.  Also,  one  investment  qualifies  for  a  100% 
climate  tag  under  022  Research  and  innovation  processes,  technology  transfer  and  cooperation 
between  enterprises  focusing  on  the  low  carbon  economy,  resilience  and  adaptation  to  climate 
change, as this reflects the measure’s main objective.  

Lastly,  this  component  is  completed  by  a  measure  supporting  the  restoration  of  degraded 
peatlands,  which  benefits  from  a  100%  climate  tag  under  037  Adaptation  to  climate  change 
measures  and  prevention  and  management  of  climate  related  risks:  others,  e.g.  storms  and 
drought  (including  awareness  raising,  civil  protection  and  disaster  management  systems, 
infrastructures and ecosystem based approaches).  

The  measures  in  Lithuania’s  recovery  and  resilience  plan  are  expected  to  effectively 
contribute  to  the  green  transition,  and  to  addressing  the  challenges  resulting  therefrom. 
The plan supports Lithuania’s decarbonisation and energy transition objectives, as set out in the 
National Energy and Climate Plan. In the NECP, Lithuania commits to reducing GHG emissions 
(-9% compared to 2005), increasing energy efficiency (reduction in primary energy consumption 
down  to  5.5  Mtoe  in  2030),  and  increasing  renewable  energy  (45%  renewables  in  gross  final 
energy consumption).11 Energy and climate investments and reforms envisaged in the recovery 
and resilience plan are consistent with the NECP as well as the Carbon Neutrality Roadmap 2050 
(RNC 2050). Lithuania has systematically ensured through its do-no-significant-harm assessment 
that  none  of  the  proposed  measures  generate  harm  to  the  protection  and  restoration  of 
biodiversity  and  ecosystems  and  has  demonstrated  how  the  measures  in  the  plan  contribute  to 
biodiversity. 

11 Economidou, M., Ringel, M., Valentova, M., Zancanella, P., Tsemekidi Tzeiranak, S., Zangheri, P., Paci, D., 
Ribeiro Serrenho, T., Palermo, V. and Bertoldi, P., National Energy and Climate Plans for 2021-2030 under the EU 
Energy Union, EUR 30487 EN, Publications Office of the European Union, Luxembourg, 2020, ISBN 978-92-76-
27013-3, doi:10.2760/678371, JRC122862. 

50 

 
 
                                                           
Various  components  of  the  recovery  and  resilience  plan  contribute  to  the  achievement  of 
the  energy  and  climate  targets  set  out  in  the  NECP  and  are  expected  to  have  a  lasting 
impact:  

Regarding renewable energy, the plan’s implementation is expected to lead to at least 301.9 MW 
of additional electricity generation capacity from RES, of which at least 271.8 MW will consist 
of solar power plants (including 4 MW solar power plant in the Utena region) and at least 30.1 
MW of onshore wind power plants will be created, while individual electricity storage facilities 
of at least 15.2 MWh are expected to be installed by 2026. In addition, energy storage facilities 
with a combined capacity of at least 200 MW should also be installed.  

Regarding  energy  efficiency,  as  a  result  of  the  plan’s  implementation,  and  in  particular  due  to 
investments  aimed  at  accelerating  the  renovation  of  buildings,  primary  energy  savings  of  215 
GWh  are  expected  to  be  attained  by  2026  which  would  translate  into  the  reduction  of  GHG 
emissions by 21.500 tCO2eq. This is in addition to the energy and GHG emissions savings that 
are expected to result from the replacement of polluting vehicles with the zero and low emission 
vehicles  accompanied  by  the  creation  of  the  necessary  alternative  fuels  production  and 
recharging/filling infrastructure.  

Regarding resource efficiency, material  reuse and reducing waste  generation, as a result of the 
plan’s  implementation,  a  Circular  Economy  Action  Plan  is  expected  to  be  adopted  by  2023  to 
ensure  Lithuania’s  transition  to  a  circular  economy  by  2035.  The  Action  Plan  is  expected  to 
focus  on  waste  prevention,  recycling,  product  design  and  use  of  secondary  raw  materials, 
digitalisation, the promotion of green innovation, as well as on an improved legal framework and 
fiscal  measures  promoting  long-term  benefits  instead  of  short-term  solutions  and  results  for  a 
return of resources to circularity. 

These  investments  are  therefore  expected  to  contribute  to  reaching  Lithuania’s  2030  and  2050 
energy and climate targets, and in particular:  

- 

- 

- 

- 

to increase the share of  RES to at least 38% of electricity by 2025, and to 45% to 50% by 
2030; 
to  reduce  GHG  emissions  by  at  least  9%  by  2030  compared  to  2005  by  increasing  energy 
efficiency, RES and alternative fuels and promoting sustainable mobility in clean, connected 
and digitalised intermodal transports; 
increasing the share of renewable energy sources in transport to 15% in  2030 by providing 
the necessary infrastructure; 
increasing GHG absorption capacity based on natural resources and technological solutions. 

The measures in the plan is expected to not only contribute to the green transition, but also 
to  the  enhancement  of  biodiversity  and  environmental  protection.  The  restoration  of 
degraded peatlands reform, as a result of which 8000 ha of these areas will be rewetted by 2026, 
will  not  only  restore  their  GHG  absorption  capacity  (it  is  estimated  that  total  GHG  emission 
reductions  could  amount  to  around  2.5  MtCO2equivalents)  but  also  reduce  surface  water 
pollution caused by agriculture.  

The recovery and resilience plan therefore supports Lithuania in meeting the national energy and 
climate targets set out in the NECP 2030 and RNC 2050 and thus in achieving carbon neutrality 
in 2050. 

51 

 
 
Taking  into  consideration  the  assessment  of  all  the  measures  envisaged,  the  recovery  and 
resilience  plan  is  expected,  to  a  large  extent,  to  make  a  significant  contribution  to  the  green 
transition  or  to  address  the  challenges  resulting  from  it  and  ensures  that  at  least  37.8%  of  its 
total allocation contribute to the climate target. This would warrant a rating of A under criterion 
2.5 of Annex V to the RRF Regulation. 

52 

 
 
 
 
4.6. Digital transition  

Digital tagging 

Lithuania’s RRP correctly follows the methodology for digital tagging set out in Annex VII 
of  the  RRF  regulation.  It  identifies  intervention  fields  and  corresponding  coefficients  for  the 
calculation of each measure’s support to the digital objectives. It should be noted that:  

 the measures of the RRP often consist of several sub-measures – for measures where that 
is  the  case,  the  RRP  indicates  an  intervention  field  for  each  sub-measure,  and  digital 
tagging is computed at sub-measure level.   

 the choice of intervention fields for the digital transition is well justified and reflects the 
nature,  focus,  objective,  or  expected  outcome  of  the  investments  included  in  the 
component. In  one  case,  the  applied  intervention  field  is  justified  only  for  part  of  the 
measure. The Commission has applied a corresponding correction in its assessment. 

 the RRP does not propose to increase the digital coefficients for any measure.  

Overall, the RRP contributes to digital objectives for 31.5% of the plan’s allocation, and as 
such, the digital target of 20% is met. The most important contributions to this target relate to 
Component 3 – Digital transition. Particularly prominent within this component are the measures 
related to the science-business framework to develop and deploy advanced digital technologies 
(EUR  117  million),  the  digitalisation  of  government  processes  and  expansion  of  digital  public 
services  (EUR  117  million),  and  the  consolidation  of  state  information  resources  (EUR  110 
million). Component 1 - Health (EUR 90 million) is the second largest contributor to the digital 
objective. Other components  that contribute to  the digital  objective  are Components 7  - Social 
(EUR  59 million),  Component  6  –  Public  sector  (EUR 45 million),  Component  2  –  Green 
transition (EUR 40 million), and Component 4 - Education (EUR 33 million).  

Digital transition  

The  digital  transition  component  covers  multiple  aspects  of  Lithuania’s  digital 
transformation  -  connectivity,  the  digitalisation  of  the  public  and  private  sectors,  and 
digital  skills. The  plan  includes  measures  to  further  develop  the  rollout  of  very  high  capacity 
networks, including 5G and fibre infrastructure in rural and remote areas. In addition, substantial 
reforms  and  investments  aim  to  digitalise  the  public  sector.  The  promotion  of  digital  skills is 
envisaged for children, employees and senior citizen as well as measures to address the shortage 
of IT specialists in the labour market. Furthermore, the Plan puts forward investments to promote 
the take-up of advanced digital technologies in the private sector, particularly regarding science-
business  cooperation  for  innovative  technologies  and  the  digitalisation  of  the  cultural  sector. 
Overall, the digital component includes five measures (three reforms and two investments).  

The  digitalisation  of  the  public  sector  is  the  focus  of  the  majority  of  measures  and  is 
covered by three reforms. This is in response to the lack of momentum in the modernisation of 
the public sector over the last decade, which has struggled to progress with the IT advancements, 
resulting  in  under-developed  state  information  systems  and  a  lack  of  coordination  at  the  state 
level.  In  this  regard,  Lithuania’s  RRP  has  prioritised  its  Digital  Agenda  to  focus  on  (i)  fully 
consolidating  state  information  resources,  IT  infrastructure  and  services,  (ii)  ensuring  the 
availability  of  reliable  public  sector  data  and  the  possibility  to  share  it  across  sectors,  and  (iii) 
fully  digitalising  government  processes  and  expand  digital  public  services,  while  ensuring  that 

53 

 
 
 
all  digital  public  services  are  accessible  for  citizens  with  disabilities.  These  measures  are 
expected  to  lay  a  solid  foundation  for  the  digital  public  sector  to  meet  the  expectations  of 
businesses and citizens to access public services in a convenient and timely manner. Investment 
in  the  digitalisation  of  the  public  sector  can  play  an  important  role  in  the  digitalisation  of  the 
economy, by creating better conditions for business and reducing costs across private and public 
sectors, with related effects on productivity. 

The plan includes an important investment to improve digital connectivity and address the 
urban-rural digital divide. The investment aims at facilitating the 5G mobile rollout, notably in 
international  land  transport  corridors  (Via  Baltica,  Rail  Baltica)  and  other  trunk  roads  and 
railway lines of national significance, airports and seaports with a relatively small financing by 
the  RRF  complemented  by  funding  from  the  Connecting  Europe  Facility,  other  EU  structural 
funds,  national  funds  and  leveraging  private  investment.  At  the  same  time,  the  plan  also  puts 
forward investment to develop 50 towers and 2000km of fibre infrastructure in rural and remote 
areas where there are market failures as well as provide access to Gigabit speed broadband for 
5000  digitally  intensive  enterprises/institutions.  The  investment  also  includes  elements  to 
encourage businesses and public bodies to innovate and to adapt to rapid digital connectivity by 
developing at least seven applications for mobility innovations (e.g. in the areas of autonomous 
transport,  drones,  etc.  across  the  sectors  communication,  education,  health,  energy,  social 
security, agriculture, environment, etc.).  

The plan puts forward investments to promote the take-up of advanced digital technologies 
in  the  private  sector.  In  particular  this  includes  science-business  cooperation  for  innovative 
technologies and the digitalisation of the cultural sector. The aim of the investment is to create 
the  necessary  conditions  for  science  and  business  to  effectively  develop  and  deploy  advanced 
and  innovative  tools  and  AI  solutions  capable  of  communicating,  reading,  analysing, 
understanding  and  interpreting  in  the  Lithuanian  language  at  an  initial  level  and  creating  and 
ensuring  universal  access  to  digitised  and  digital  resources  that  enable  science,  business  and 
society to develop innovative technologies, services and products based on cultural content. The 
measure  includes  six  investment  strands:  (i)  investment  in  the  development  of  Lithuanian-
language  technological  resources;  (ii)  investment  in  digitisation  and  accessibility  of  cultural 
resources;  (iii)  investment  in  the  production  of  digital  education  content  and  resources;  (iv) 
investment  in  financial  instruments  for  digital  business  creation  and  digital  innovation,  (v) 
financial  incentives  for  business  service  centres  to  develop  and  deploy  solutions  for  the 
automation of robotics processes and artificial intelligence; and (vi) investment to create an ICT 
Competence Centre.  

Lithuania has presented an ambitious agenda to promote the development of digital skills 
at  all  levels  of  society,  including  pupils,  employees,  civil  servants,  jobseekers,  vulnerable 
groups,  and  older  people. The  measures  on  digital  skills  are  included  horizontally  across  the 
RRP: in Component 3 - Digital transition (measure Customer-oriented services), Component 6 - 
Public sector (measures Efficient Public Sector and  Smart tax administration to reduce the VAT 
employment 
gap 
support). Component 4 – Education (measure on acquisition of competences for green and digital 
transformation  in  vocational  education  and  training  and  measure  on  lifelong  learning  system). 
The development of digital skills is also planned to be funded by other EU structural funds, for 
example, investment in human resources with a particular focus on developing and upgrading the 

Social (measure Client-oriented 

and Component 

faster), 

7 

- 

54 

 
 
digital skills of SME workers, improving the digital literacy of children, and the development of 
digital skills of low-skilled adults (especially older people).  

The  digital  dimension  is  also  prominently  covered  outside  the  digital  component. In  the 
context of the pandemic, the digitalisation of health and education systems has become a major 
challenge and a priority for action, thus it is welcome that the plan includes measures promoting 
digital solutions related to e-health and online learning in Component 1 - Health and Component 
4  -  Education. Component  7  –  Social  protection further  includes  measures  to  fully  integrate 
digital solutions into the organisation of the Employment Service and the provision of services, 
including  digital  counselling. Component  2  –  Green  transition  will  contribute  to  the  digital 
transformation  through  encouraging  investment  in  electricity  storage  facilities  managed  by 
digital  solutions  and  increase  the  speed  of  the  building  renovation  process  with  digital 
solutions. Component  6  -  Public  sector includes  digital  solutions  for  tax  and  customs  duties 
collections.  

for 

the  digital 

investments 

The  reforms  and 
transition  create  synergies  and 
complementarities  with  planned  Cohesion  Policy  investments,  other  European  level 
initiatives  as  well  as  the  Lithuanian  national  strategic  context. The  plan  includes  measures 
with a somewhat higher maturity, taking into account the relatively short eligibility period of the 
plan by the end of 2026 compared to other Cohesion policy investments. Demarcation between 
different  projects  or  their  implementation  stages  are  set  out.  The  Plan  is  aligned  with  the 
European  Digital  Strategy,  focused  on  improving  competitiveness,  digital  connectivity  and 
boosting the digitalisation of the economy. The Plan includes measures that are expected to be 
co-financed  under  the  Connecting  Europe  Facility,  and  Cohesion  policy  funds  as  well  as  it  is 
underpinned  by  the  overall  implementation  strategy  of  the  Lithuanian  Digital  Agenda  and  the 
objectives of the Eighteenth Government Programme.  

Taking  into  consideration  the  assessment  of  all  the  measures  envisaged,  the  Recovery  and 
Resilience  Plan  is  expected,  to  a  large  extent,  to  make  a  significant  contribution  to  the  digital 
transition  or  to  address  the  challenges  resulting  from  it  and  ensures  that  31.5%  of  its  total 
allocation  contribute  to  support  digital  objectives.  This  would  warrant  a  rating  of  A  under 
criterion 2.6 of Annex V to the RRF Regulation. 

4.7. Lasting impact of the plan  

The  measures envisaged in the plan are expected to address  the structural weaknesses of 
Lithuania  and  have  lasting  positive  effects  on  its  economy.  Overall,  the  plan  boosts  the 
growth potential of the economy, fosters job creation and aims at enhancing inclusiveness. The 
Green  transition,  Digital  transition  and  Education  components,  as  well  as  the  Higher 
education  and  Innovation  component,  are  expected  to  foster  job  creation,  economic 
competitiveness  and  sustainable  long-term  growth.  Measures  of  the  green  component  are 
expected to contribute to the reduction of Lithuania’s dependence on foreign and non-renewable 
energy  and  create  the  adequate  infrastructure  and  capacities.  The  digitalisation  of  the  public 
sector,  the  economy,  and  academia  will  make  the  economy  more  resilient  to  potential  shocks, 
using digital competitiveness as a key driver of economic recovery. Investments and reforms in 
the  education  system,  notably  the  early  childhood  and  general  education  (evaluation  system, 
school  network,  curriculum)  and  the  vocational  education  (making  VET  more  attractive  and 
better  aligned  with  the  labour  market  needs),  are  expected  to  drive  Lithuania’s  labour  market 

55 

 
 
  
competitiveness in the long-run. Finally, the creation of a single Innovation agency, streamlining 
state innovation policy and enhancing the cooperation between science, academia and businesses 
are expected to have a considerable lasting and high added-value impact on economic sectors in 
Lithuania.  As recalled in the updated EU industrial strategy12, a well-functioning internal market 
will  be  key  for  strengthening  diversification,  competitiveness  and  resilience  of  Lithuania’s 
economy. 

The social protection  and health  components are also  expected to have a lasting effect on 
Lithuania’s  inclusiveness.  For  instance,  under  the  component  7  –  Social  protection,  measures 
focusing  on  training  the  next  generation  of  youth,  and  investment  in  active  labour  market 
policies, are expected to have a lasting impact on the functioning of the labour market, as well as 
on  poverty  reduction  and  income  equality.  The  planned  increase  in  the  coverage  of  the 
unemployment social insurance system, as well as the planned increase in universal benefits for 
all single-person beneficiaries are also expected to have some lasting impacts, provided that their 
financing shall remain sustainable. 

The long-term impact of those components is expected to be reinforced by reforms planned 
in  component  6  on  the  Public  sector.  These  will  aim  at  reducing  the  VAT  gap,  abolishing 
inefficient tax breaks and exemptions, and expanding the tax base to sources less detrimental to 
growth.  These  efforts  should  allow  collecting  additional  funds  into  the  public  budget  and 
increase  the  redistributive  capacity  of  the  tax-benefit  system  and  help  improve  fiscal 
sustainability and economic efficiency. 

Overall, the plan is estimated to have a sizeable positive long-term impact on Lithuania’s 
GDP and employment. The economic model presented in the plan foresees an improvement of 
GDP compared to the baseline scenario – by 1.69% in the medium-term (5 years) and 0.73% in 
the  long-term  (20  years)  annually.  The  impact  of  the  plan  on  employment  is  also  estimated  at 
1.61%  in  the  medium-term,  and  1.81%  in  the  long-term.  As  a  result,  the  unemployment  rate 
(8.5%  in  2020)  would  be  2    percentage  points  lower  in  the  medium-term  and  1.9    percentage 
points lower in  the long-term  (compared to  the  baseline). While these results partly rely on  an 
optimistic assumption regarding the multiplier effect of the plan (1.9 over the period 2021-2026), 
it  remains  plausible  that  the  plan  shall  have  sizeable  long-term  impacts  in  terms  of  GDP  and 
employment. 

Structural change in administration and institutions, as well as in policies 

Structural changes on administration and relevant institutions, as well as in policies, can be 
expected from the implementation of the plan. 

Under the component on health (component 1), some measures aimed at increasing efficiency 
are  expected  to  bring  structural  changes  in  the  administration  or  in  relevant  institutions.  This 
includes  measures  on  the  consolidation  of  the  hospital’s  network,  the  creation  of  a  centre  of 
excellence (Advanced therapies centre), the establishment of a Health Professionals Competency 
Platform  and  the  development  of  the  digital  health  system.  The  envisaged  adoption  of  the 

12 Updating the 2020 New Industrial Strategy. COM(2021)350 final.  

56 

 
 
                                                           
legislative  package  (Emergency  Medical  Act  and  related  legislation)  which  regulates  the 
organisation,  management  and  provision  of  ambulance  services,  is  also  expected  to  bring 
structural changes in policy. 

Overall, the measures under component 1 are expected to have a lasting positive impact on the 
healthcare  system  (both  in  terms  of  administrations  or  institutions,  and  policies).  The 
developments  related  to  the  reform  of  the  hospital  network  will  however  depend  on  the  social 
consensus  and  political  agreement  at  local  level.  In  addition,  reforms  related  to  the  healthcare 
workforce  will  also  be  crucial  to  sustain  the  transformation  of  the  health  system.  Finally,  the 
lasting  impact  of  the  RRP  will  depend  on  complementary  investments  implemented  by  other 
funding sources to strengthen primary care and preventive measures, which are crucial to ensure 
the quicker transition towards better health outcomes. 

Under the component on green transition (component 2), various measures are expected to 
have a sizeable lasting impact on policies. 

For instance, as a result of Plan’s implementation, the Circular Economy Action Plan is expected 
to  be  adopted  by  2025  to  ensure  Lithuania’s  transition  to  a  circular  economy  by  2035,  with  a 
focus  on  waste  prevention,  recycling,  or  the  use  of  secondary  raw  materials.  Furthermore,  the 
measures contributing to reduce Lithuania’s dependence on non-renewable energy would trigger 
the creation of adequate frameworks and positively impact policy-making in the energy domain. 

The  component  on  digital  transition  (component  3)  includes  measures  fostering  the 
digitalisation  of  the  public  sector.  These  measures  are  expected  to  have  a  lasting  positive 
impact  on  the  functioning  of  the  public  administration  and  its  efficiency.  In  addition,  the 
facilitation of the 5G rollout is expected to bring a structural change for digital policy making. 
As regards transport, measures under the component 2 also boost innovative and smart mobility, 
thereby contributing to the objectives of the Smart and Sustainable Mobility. 

Measures in the component on education (component 4) are also expected to bring a lasting 
impact on education policy and institutions. The Millennium School programme is expected 
to  improve  access,  quality  and  efficiency  by  encouraging  municipalities  to  consolidate 
educational  resources  and  innovating  existing  schools,  paying  particular  attention  to  teaching 
quality and to the creation of an inclusive education ecosystem in schools. The programme aims 
at  introducing  networking-based  organisation  and  improving  management  of  school  funding  at 
municipal  and  school  level.  Some  measures  are  also  aimed  at  raising  accessibility  and 
participation  at  early  childhood  education  level  and  at  strengthening  its  educational  content. 
Some  measures  are  also  aimed  at  improving  the  participation  in  adult  learning,  as  well  as 
enhancing  the  professional  guidance  system  and  increasing  the  quality  and  attractiveness  of 
vocational  education  and  training.  Ultimately,  all  these  measures  are  expected  to  improve 
equality in education in the long-term, mitigating the impact of the socio-economic background 
on education. 

Measures  under  the  component  on  higher  education  and  innovation  (component  5)  are 
expected  to  improve  effectiveness  and  efficiency  of  the  higher  education  sector.  Higher 
student admission standards, changing funding model and higher qualitative standards for higher 
education  institutions  are  expected  to  improve  the  quality  of  higher  education  programmes, 
increasing  the  R&D  component  in  the  funding  system,  and  are  likely  to  result  in  the 
consolidation  in  the sector.  In addition,  the consolidation of innovation  promotion  functions in 

57 

 
 
one single innovation agency is likely to make public administration more effective and efficient 
in  that  field.  Furthermore,  Lithuania’s  commitment  in  the  RRP  to  develop  a  coherent  science-
business cooperation framework could be considered as a structural change. 

Various measures under the component on public sector (component 6) are also expected 
to bring structural change in administration or relevant institutions, as well as on policy. 
Lithuania’s  plans  to  centralise  HR  management  of  the  civil  servants  and  invest  in  staff 
development, especially of managers (digital, strategic and leadership skills) will bring about a 
structural  change.  The  tax  and  customs  administrations’  plan  to  invest  in  IT  tools  should 
structurally facilitate their work. Investments in customs are expected to contribute to reducing 
the risk of non-compliant and/or illegal goods being placed on the internal market, which should 
also  ensure  a  level  playing  field  for  businesses  and  the  adequate  protection  of  consumers.  The 
planned  changes  to  the  Law  and  the  Budget  Structure  aim  at  enhancing  medium  term  budget 
planning,  establishing  a  process  of  spending  reviews  and  clarifying  the  rules  on  budget 
amendment.  Lithuania  also  plans  to  reduce  the  size  of  the  shadow  economy  and  improve  tax 
compliance, by limiting cash use in some sectors and (or) for some types of transactions. Finally, 
Lithuania is planning to amend tax legislation in order to broaden the tax bases less detrimental 
to  growth.  Though  the  results  depend  on  the  design  of  amendments,  this  could  potentially 
generate additional revenues to the budget. 

Under the component on social protection (component 7), the planned digitalisation of public 
employment service (new IT platform which will allow 90% of services to be provided digitally) 
is expected to bring structural change in the administration and free up resources to be used for 
more advisory work rather than administration. 

Taking into consideration all reforms and investments envisaged by Lithuania in its recovery and 
resilience  plan,  their  implementation  is  expected,  to  a  large  extent  to  bring  about  a  structural 
change  in  the  administration  or  in  relevant  institutions  and  in  relevant  policies  and  to  have  a 
lasting  impact.  This  would  warrant  a  rating  of  A  under  criterion  2.7  of  Annex  V  to  the  RRF 
Regulation. 

4.8. Milestones, targets, monitoring and implementation 

The  Ministry  of  Finance  and  the  Central  Project  Management  Agency  will  be  assigned 
responsibilities  that  will  provide  an  adequate  structure  for  implementing  the  plan, 
monitoring  progress  and  reporting.  The  Ministry  of  Finance  will  be  the  managing  authority 
which  will  coordinate  the  implementation  and  monitoring  of  the  plan  and  will  be  the  main 
contact point for the Commission. The Ministry will prepare and adopt the necessary legal acts 
for  the  management  and  control  system  of  the  plan,  will  ensure  proper  audit  trail  and  record 
keeping. The Central Project Management agency (CPMA) will be an administrating authority of 
the  plan.  CPMA  will  assess  and  select  projects,  will  ensure  their  compliance  with  project 
contracts,  as  well  as  national  and  EU  legislation.  CPMA  will  monitor  project  implementation 
progress, will provide necessary information to the Ministry of Finance and will develop an IT 
system to ensure that it contains the data set out in Article 22 of the RRF Regulation. Both the 
managing  and  administrating  authorities  will  have  rights  to  access  the  information  from  the 
project  managers,  other  institutions  and  data  registers  which  will  be  needed  to  exercise  their 
functions.  Both  the  Ministry  of  Finance  and  CPMA  have  relevant  expertise  in  planning, 
managing and implementing projects funded by the EU Structural Funds and other sources. The 

58 

 
 
reporting mechanism between the Ministry of Finance, CPMA and the sectoral ministries which 
will be responsible for the reforms and investments in their areas could be further elaborated. 

The  implementation  and  monitoring  of  the  plan  is  expected  to  require  additional  human 
resources.  Around  16  full  time  equivalent  jobs  will  be  allocated  in  the  managing  authority 
within  the  institution’s  existing  resources  and  around  100  new  employees  will  be  hired  in  the 
CPMA  to  exercise  the  plan-related  functions.  The  planning  and  hiring  of  staff  should  be 
completed before the end of 2021. Authorities are expected to ensure that new staff is equipped 
with necessary skills. The administrative capacity of the sectoral ministries and authorities under 
their control which will be in charge of the plan’s reforms and investments was not assessed in-
depth in the plan. 

The  plan  is  expected  to  be  implemented  under  the  new  national  strategic  management 
system  and  revised  EU  structural  funds’  management  procedures,  but  uncertainties 
remain as to the timely adoption and implementation of necessary rules and  systems. The 
implementation  of the new strategic planning system is  being  finalised,  which should ensure  a 
link  between  the  investments  and  strategic  goals  of  the  country  as  well  as  coherence  between 
investments  funded by different  funding sources. Similarly, processes  for the administration of 
the EU structural funds are being revised with a view to optimise them for the 2021-2027 period. 
The IT tool to manage and monitor investments funded by the Recovery and Resilience Facility 
and 2021-2027 EU structural funds is under development and is expected to be fully functional 
by mid-2022. Until then, transitionary systems and rules will be used. It is important to ensure 
that  the  transitionary  period  is  smooth  and  that  all  remaining  legal  acts  and  technical  tools  are 
developed and finalised in a timely manner to ensure proper implementation and monitoring of 
the plan. 

The  milestones  and  targets  of  the  Lithuanian  plan  are  backloaded  towards  2026  which 
poses a risk for the full implementation of the plan. The implementation of the 30 measures in 
the plan is tracked through 191 milestones and targets, of which there are 98 milestones and 93 
targets. The milestones and targets represent the key elements of the measures and are relevant 
for  their  implementation.  The  verification  mechanisms,  data  collection  and  responsibilities 
described  by  the  Lithuanian  authorities  appear  sufficient  to  justify  the  disbursement  requests 
once the milestones and targets are completed. In most cases, sectoral ministries and authorities 
under their control will be responsible for achieving milestones and ensuring the traceability and 
validity of the data on milestones and targets achieved. However, the distribution of milestones 
and  targets  across  time  is  somewhat  uneven,  with  a  backloading  towards  2026.  This  could 
represent  a  risk  for  the  full  implementation  of  the  plan  if  some  reforms  and  investments  are 
delayed. The monitoring indicators are sufficiently clear to ensure that their completion can be 
traced and verified. They reflect adequately the overall level of ambition of the plan and appear 
realistic.   

The  plan  describes  the  institutional  actors  that  are  responsible  for  the  implementation  of 
the  individual  reforms  and  investments  at  component  level.  The  various  actors,  mainly 
sectoral  ministries  and  authorities  under  their  control,  which  will  be  in  charge  of  the 
implementation of the measures, are indicated in the description of the components of the plan. 
Close technical cooperation between the Ministry of Finance, CPMA and sectoral ministries will 
be  critical  for  the  plan’s  implementation.  Involvement  of  other  authorities,  such  as  the  Public 
Procurement Service, the Competition Council, the Financial Crime and Investigation Service as 

59 

 
 
well as Special Investigation Service will be important to ensure the proper and lawful use of EU 
funds. More broadly, involving the national Parliament, local authorities, civil society and social 
partners  will  be  key  to  ensure  the  successful  implementation  of  the  reforms  and  investments 
under the plan. 

The arrangements proposed by Lithuania in its recovery and resilience plan are expected to be 
adequate to ensure effective monitoring and implementation of the recovery and resilience plan, 
including the envisaged timetable, milestones and targets, and the related indicators. This would 
warrant a rating of A under the assessment criterion 2.8 of Annex V to the RRF Regulation. 

4.9. Costing 

Lithuania has provided individual estimated costs for all investments and many reforms in 
the recovery and resilience plan. 

The  cost  breakdown  is  generally  detailed  and  well-substantiated.  For  almost  all  cost 
estimates  the  assumptions  used  are  well  described  and  can  be  understood.  The  estimates  are 
mainly  based  on  comparisons  with  past  investments  of  similar  nature  and  procurement  data. 
While the tables proposed in the standard template were duly completed and presented, Lithuania 
did not provide an independent validation for any of the cost estimates proposed.   

The assessment of the cost estimates and inherent supporting documents shows that most 
of the costs are well justified, reasonable and plausible. 

Reasonable costs  

To support the cost estimates, Lithuania provided an extensive list of documents to justify 
and  explain  the  amounts  proposed  and  gave  explanations  on  how  those  amounts  were 
computed. For the most part, older projects or comparative cost data for the main cost drivers 
were  presented  to  serve  as  a  benchmark  for  the  cost  estimates.  The  analysis  of  the  supporting 
evidence  is  not  consistent  throughout  the  plan.  While  for  the  most  part  the  calculations  were 
clearly spelt out and it is possible to clearly identify the methodology used, for a limited number 
of  sub-investments  the  information  provided,  proved  less  clear.  Nevertheless,  there  is  no 
evidence that would allow doubting the costing estimates provided. 

In this context, it is deemed that the reasonability of the cost estimates has been established to a 
medium extent.  

Plausible costs   

The amount of the estimated total  costs of the recovery and resilience plan is in line with 
the nature and type of the envisaged reforms and investments. Lithuania provided a large set 
of  documents  and  links  to  online  sources  to  substantiate  the  cost  estimates.  Explanations  were 
added  to  how  the  past  projects  relate  to  the  cost  estimates  of  the  new  investments  in  the  Plan, 
enabling a full assessment of the plausibility of the costs.  For about a third of the measures the 
costs  were  deemed  quite  high  compared  to  costs  of  similar  investments,  leading  to  a  medium 
plausibility rating.  

Considering  the  limitations  of  an  ex-ante  assessment  of  cost  estimates,  the  amounts 
proposed for financing were deemed appropriate and seen as establishing the plausibility 
of the cost estimates to a medium extent.   

60 

 
 
No double EU financing  

The  individual  components  provide  clear  information  about  additional  investments  from 
other EU funds. Projects funded by other EU sources are demarcated in time and scope from the 
projects in the RRP. Furthermore, Lithuania has put in place arrangements to avoid double EU 
funding both at the project and at the plan level. At RRP level, checks will be carried out in the 
planning stage to identify the specific sources of funding to ensure that the same activities will 
not be financed from multiple sources. At the project level, before the funding is awarded to a 
project, it will be verified which other projects have been carried out and/or are being carried out 
by the same applicant. In case risk of overlap is identified, those cost categories will be screened 
before  processing  the  payment.  Finally,  on-the-spot  checks  to  verify  that  there  is  no  overlap 
between project activities and expenditure will also be carried out. 

To note, the 2021-2027 Partnership Agreement is currently under negotiation, and as such 
a completely developed delineation is not possible at this moment. However, the Commission 
did a preliminary check to reduce the risks of double European Union financing, and no evidence 
of clear risks was identified.   

Commensurate and cost-efficient costs   

The recovery and resilience plan is expected to effectively help address a significant subset 
of  challenges  identified  in  the  country-specific  recommendations  (CSRs).  Moreover,  the 
recovery  and  resilience  plan  contains  measures  to  support  economic  growth  and  economic 
cohesion  in  an  inclusive  manner.  The  main  objectives  of  the  plan  are  to  improve  Lithuania’s 
growth  potential,  job  creation,  and  economic,  social  and  institutional  resilience  that  will 
ultimately reduce the country’s vulnerability to shocks. Several of these measures also contribute 
effectively to the implementation of the European Pillar of Social Rights, including through the 
promotion of policies for children and youth, and to mitigating the economic and social impact 
of  the  COVID-19  crisis,  thereby  enhancing  the  economic,  social  and  territorial  cohesion  and 
convergence  within  the  Union.  The  significant  economic  and  social  impact  of  the  plan  in 
combination  with  the  positive  cost  assessment,  indicates  that  the  cost  is  in  line  with  the 
principle of cost-efficiency.  

The justification Lithuania  provided on the amount  of  the estimated total costs of  the recovery 
and resilience plan is, to a medium extent reasonable and plausible, in line with the principle of 
cost-efficiency  and  commensurate  to  the  expected  national  economic  and  social  impact. 
Lithuania provided sufficient information and evidence that the amount of the estimated cost of 
the reforms and investments of the recovery and resilience plan to be financed under the Facility 
is not covered by existing or planned Union financing. This would warrant a rating of B under 
the assessment criterion 2.9 of Annex V to the RRF Regulation.  

4.10. 

Controls and audit  

Robustness of internal control system and distribution of roles and responsibilities 

The  internal  control  system  seems  to  be  robust,  with  a  clear  distribution  of  roles  and 
responsibilities. As set out in the plan the implementation of Lithuanian RRP will be based on: 

 
 

the national strategic management system,   
the management and control system set up for the administration of RRP, as well as 

61 

 
 
  roles and responsibilities of other state authorities acting in accordance with their 

remit under national legislation. 

The  recently  adopted  Law  on  Strategic  Governance  establishes  a  results-oriented  national 
strategic  management  system,  integrating  strategic  planning,  regional  development  and  spatial 
planning processes and aiming to ensure sustainable development, effective planning and use of 
public finances. These principles have been applied when preparing the RRP. 

The  RRP  management  and  control  system  will  be  based  on  the  model  used  for  the  EU 
Structural  Funds,  which  is  undergoing  significant  changes  for  the  2021-2027  funding 
period, and will be governed by the same principles and rules, except where different procedures 
and processes are needed to fulfill the specific requirements of the RRF Regulation. The system 
will encompass a set of functions and procedures for the management and control of RRP to be 
carried  out  by  (i)  the  managing  authority,  (ii)  the  administering  authority  and  (iii)  the  audit 
authority within their remit, ensuring compliance with the provisions and principles of European 
Union (EU) and national legislation.  

In  addition  to  the  responsibilities  entrusted  to  the  managing  and  administering  authorities  (as 
described  in  section  4.8)  as  of  1  May  2021  the  functions  of  the  audit  authority  have  been 
assigned  to  the  Central  Internal  Audit  Division  and  to  the  Department  for  Conformity 
Assessment  and  Declaration  of  Expenditure  within  the  Ministry  of  Finance.  These  two 
administrative units are functionally independent from other administrative units of the Ministry 
of Finance, are directly accountable to the Minister of Finance, and have direct and unhindered 
access  to  all  levels  of  the  organisation.  The  adoption  of  an  audit  strategy  is  planned  for 
September 2021. It is foreseen that the audit authority will be carrying out both the assessment of 
the  effectiveness  of  the  internal  control  system  of  the  authorities  responsible  for  the 
implementation  of  the  RRP  (system  audits)  as  well  as  audits  of  selected  projects  focusing  on 
performance aspects (and expenditure audits, if needed). The audit authority will also ensure the 
follow-up of recommendations made and report back to the managing authority on their state of 
play. 

All  information  related  to  RRP  implementation  (including  the  data  required  under  Article 
22(2)(d) of the RRF regulation) will be stored in a single IT system dedicated to management 
of  all  EU  funds  for  2021-2027  period  (IS2021).  The  IS2021  aims  to  digitalise  all  project 
management processes, including monitoring of milestones and targets under RRP. At the time 
of  the  submission  of  the  plan  the  system  was  still  under  development  and  was  expected  to 
become operational mid-2022. As set out in the plan existing tools used for the management of 
the state budget will be used during the transitional period and an audit trail will be ensured. In 
this  context  a  milestone  with  regard  to  the  fulfilment  of  reporting  requirements  set  out  in  the 
RRF regulation has been included in the plan. 

Other  bodies  entrusted  with  the  certain  functions  under  national  legislation  will  also  be 
part  of  the  RRP  governance  structure.  This  concerns  in  particular  the  Public  Procurement 
Office,  Financial  Crime  Investigation  Service,  Special  Investigation  Service  as  well  as  the 
Competition Council. 

Adequacy of control systems and other relevant arrangements 

62 

 
 
In  their  plan  the  Lithuanian  authorities  have  described  adequate  policies,  systems  and 
procedures to prevent, detect and correct corruption, fraud and conflicts of interests when 
using  the  funds  provided  under  the  RRF.  These  include,  for  example,  the  provisions  in  the 
Law  on  declaration  of  public  and  private  interests  which  sets  out  the  requirement  for  civil 
servants  to  declare their  private interests to  ensure that public interests prevail in  the decision-
making  process  and  that  conflicts  of  interest  and  corruption  are  prevented.  For  this  purpose  a 
register  of  private  interests  has  been  developed.  Besides  controls  to  be  carried  out  by  the 
administering  and  audit  authorities  the  Financial  Crime  Investigation  Service  and  Special 
Investigation  Service  through  their  respective  roles  in  fighting  corruption  and  financial  crimes 
would also contribute to the adequacy of the control systems. Concerning risk scoring and data 
mining  tools,  the  Lithuanian  authorities  are  considering  using  ARACHNE  once  the  IS2021  IT 
tool is in place but a definitive decision couldn’t be taken at this stage. 

Alternatively,  other  data-analysis  and  risk-scoring  tools  would  be  put  in  place.  To  address  the 
risks  of  delays  in  implementation  and  capacity  issues  it  is  important  to  ensure  the  timely 
finalization  of  setting-up  the  management  and  control  system  for  the  EU  funds  2021-2027, 
including the new IS2021 tool. 

Adequacy of arrangements to avoid double EU funding 

The  arrangements  described  in  the  RRP  to  avoid  double  EU  funding  are  adequate. 
According to the RRP, the risk of double EU funding will be mitigated both at the project and at 
the plan level. At the RRP level, this will include checks in the planning stage to link planned 
activities  to  specific  sources  of  funding  to  ensure  that  the  same  activities  will  not  be  financed 
from multiple sources.  At the project  level, activities to prevent double funding are carried out 
both  before  and  throughout  the  project  implementation.  Before  the  funding  is  awarded  to  a 
project, it will be verified which other projects have been carried out and/or are being carried out 
by the same applicant. In this respect, the necessary data from RRP projects will be collected and 
stored in IS2021 which will include a functionality to verify that the supporting documents are 
not submitted twice. In case a risk of overlap is identified, those costs categories will be screened 
before  processing  the  payment.  Finally,  on-the-spot  checks  to  verify  that  there  is  no  overlap 
between project activities and expenditure will be also carried out.  

Legal empowerment and administrative capacity of control function 

The  legal  acts  appointing  the  above  described  RRP  authorities  (managing,  administering 
and audit authorities) are in final phase of the preparation and are expected to be adopted 
by  end  July  2021.  These  bodies  shall  be  granted  full  access  to  the  relevant  information  from 
other  authorities,  bodies  and  project  promoters  as  well  as  from  main  State  and  departmental 
registers, information systems and databases managed by public authorities and bodies. A long 
history  of  the  managing  and  administrative  bodies  to  manage  EU  and  other  international 
programmes  is  expected  to  contribute  to  a  smooth  implementation  of  the  RRP.  However,  the 
expertise and  administrative capacity of the newly  created  audit authority  still need to  be built 
up. 

The arrangements proposed by Lithuania in the recovery and resilience plan to prevent, detect 
and correct corruption, fraud and conflicts of interest when using the funds provided under the 
Facility, including the arrangements aimed to avoid double funding from the Facility and other 

63 

 
 
Union  programmes,  are  assessed  to  be  adequate.  This  would  warrant  a  rating  of  A  under  the 
assessment criterion 2.10 of Annex V to the RRF Regulation.  

4.11. 

Coherence 

The  Lithuanian  recovery  and  resilience  plan  is  coherent,  with  consistent  reforms  and 
investments,  and  synergies  between  the  different  components.  The  seven  components 
structure  the  investments  and  reforms  and  show  their  thematic  relation  and  interlinkages  well. 
Coherence  is  ensured  within  the  components,  with  investments  accompanied  with  relevant 
reforms,  as well as between the different  components in  the plan through mutually  reinforcing 
reforms and investments.  

The  reforms  and  investments  in  each  component  included  in  the  RRP  are  coherent, 
complementary  and  mutually  reinforcing.  Reforms  included  in  the  plan  within  components 
enable or facilitate the planned investments. Different components do not have negative effects 
on each other and in many cases reinforce measures related to the Green Transition and Digital 
Transformation.  In  the  health  component,  the  investment  planned  for  the  construction  of  new 
buildings  will  contribute  most  to  the  green  transformation  objectives  by  increasing  energy 
efficiency in buildings and the use of RES for electricity and/or heating. One of the three health 
component reforms contributes significantly to the objectives of digital transformation in the area 
of  the  digital  health  system  by  contributing  to  digital  public  services,  the  integration  of  digital 
technologies, the use of online services and the development of digital competences. In the green 
component, one of the reforms will contribute to the objectives of the digital transformation, by 
investing in a new electricity storage infrastructure which will be fully automated, autonomous 
and smart. In the education component, all reforms will contribute to the digital transformation 
objectives,  mostly by contributing to  the development  of digital  skills  and competences.  In the 
higher  education  and  innovation  support  component,  activities  to  promote  efficient  innovation 
policies, increase demand for innovation in start-up systems and to develop green innovation will 
contribute  to  the  green  transition.  The  creation  of  an  industrial  platform  for  the  exchange  of 
technological know-how and solutions will contribute to the reorientation of the industrial sector 
towards  a  circular  economy.  The  public  sector  component  reforms  will  contribute  to  the 
objectives of the digital transition. The main contribution to the digital transformation will come 
from the development of digital services, applications and support to the acquisition of relevant 
skills and competences. In the social component, both the competence acquisition measure and 
new  entrepreneurship  support  activities  will  focus  on  the  digitalisation  and  greening  of  the 
economy  and  almost  all  programmes  will  contribute  to  the  development  of  digital  skills.  The 
customer-oriented employment  support reform  will  contribute significantly  to  the objectives of 
the digital transformation. 

The  RRP  reveals  a  strategic  and  consistent  vision,  visible  throughout  the  plan,  displaying 
coherence  at  different  levels:  within  each  component,  between  the  objectives  of  different 
components and amidst individual reforms and investments in different components. The RRP is 
also  consistent  with  the  National  Progress  Plan  and  the  Government's  Programme.  In  order  to 
promote wider coherence across instruments, notably with the European cohesion policy funds, a 
balanced territorial allocation of resources is encouraged. 

Taking into consideration the qualitative assessment of all the components of Lithuania’s RRP, 
their  individual  weight  (size,  relevance,  financial  allocation)  and  their  interactions,  the  plan 

64 

 
 
contains  measures  for  the  implementation  of  reforms  and  public  investments  which,  to  a  high 
extent,  represent  coherent  actions.  This  would  warrant  a  rating  of  A  under  the  assessment 
criterion 2.11 of Annex V to the RRF Regulation. 

65 

 
 
 
 
5.  ANNEX 

Lithuania Climate Tracking and Digital Tagging Table13 

Climate 

Digital 

Budget 
(EUR 
m) 

1.3 

Int. Field 

011 – Government 
ICT solutions, e-
services, 
applications 

Coeff. 
% 

0% 

Int. Field 

4-011 – Government 
ICT solutions, e-
services, applications 

Coeff. 
% 

100% 

2.5 

011 – Government 
ICT solutions, e-
services, 
applications 

0% 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

85.7 

095 – Digitalisation 
in health care 

0% 

4-095 – Digitalisation 
in health care 

100% 

Measure/ 
Sub-
Measure 
ID 

4 

5 

6 

7 

Measure/Sub-Measure 
Name 

1 – Improving the 
quality and accessibility 
of services and 
promoting innovation- 
Establishment of the 
Competency Platform 
IS 
1 – Improving the 
quality and accessibility 
of services and 
promoting innovation- 
Measurement 
framework 
1 – Improving the 
quality and accessibility 
of services and 
promoting innovation- 
Developing the 
digitalisation of the 
health sector 
1 – Reform of the 
provision of long-term 
care services –  Day 
Centres (installation) 

5.4 

026 – Energy 
efficiency 
renovation or energy 
efficiency measures 
regarding public 
infrastructure, 
demonstration 
projects and 
supporting measures 
026 – Energy 
efficiency 

40% 

0% 

40% 

0% 

11 

1 – Systemically 
strengthening the 

12 

13 While the total cost of the Lithuanian recovery and resilience plan exceeds the total allocation of non-repayable 
financial support to Lithuania, Lithuania will ensure that all spending related to the measures mentioned in this table 
as contributing to climate objectives are fully financed by the funds from the Recovery and Resilience Facility.  

66 

 
 
 
 
 
 
 
                                                           
Measure/ 
Sub-
Measure 
ID 

Budget 
(EUR 
m) 

Measure/Sub-Measure 
Name 

resilience of the health 
system to work in 
emergencies –  Personal 
health care facilities 
(reconstruction) 

13 

2 – Increasing GHG 
absorption capacity 

16 

Climate 

Digital 

Int. Field 

Coeff. 
% 

Int. Field 

Coeff. 
% 

renovation or energy 
efficiency measures 
regarding public 
infrastructure, 
demonstration 
projects and 
supporting measures 
037 – Adaptation to 
climate change 
measures and 
prevention and 
management of 
climate related risks: 
others, e.g. storms 
and drought 
(including 
awareness raising, 
civil protection and 
disaster management 
systems, 
infrastructures and 
ecosystem based 
approaches) 
028 – Renewable 
energy: wind 

100% 

0% 

100% 

0% 

9.786 

14 

15 

16 

2 - More sustainably 
produced electricity in 
the country - 
Preparatory work for 
the development of 
offshore wind power 
plant and related 
infrastructure 
2 – More sustainably 
produced electricity in 
the country –  
Investment support for 
the construction of RES 
plants (wind power 
plants on land) 
2 – More sustainably 
produced electricity in 
the country –  E. 

19.323 

028 – Renewable 
energy: wind 

100% 

6.44 

033 – Smart Energy 
Systems (including 
smart grids and ICT 

100% 

67 

0% 

0% 

 
 
 
 
 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

Measure/Sub-Measure 
Name 

Budget 
(EUR 
m) 

Climate 

Digital 

Int. Field 

Coeff. 
% 

Int. Field 

Coeff. 
% 

17 

18 

19 

20 

21 

construction of 
individual energy 
storage facilities 
2 – More sustainably 
produced electricity in 
the country –  
Investment support for 
the construction of RES 
power stations (solar) 
2 – More sustainably 
produced electricity in 
the country –  
Installation of other 
electricity storage 
infrastructure 
2 – More sustainably 
produced electricity in 
the country –  Regional 
support for the 
construction of a 4 MW 
solar park in Utena 
County 
2 – Accelerating 
renovation of buildings 
and a sustainable urban 
environment –  Organic 
renovation construction 
materials 

50 

3 

2 – Accelerating 
renovation of buildings 
and a sustainable urban 
environment –  Pilot 
renovation projects 
(multi-apartment) 

systems) and related 
storage. 

103.05 

029 – Renewable 
energy: Solar 

100% 

0% 

100 

033 – Smart Energy 
Systems (including 
smart grids and ICT 
systems) and related 
storage. 

100%  4-033 – Smart Energy 

40% 

Systems (including 
smart grids and ICT 
systems) and related 
storage 

3.788 

029 – Renewable 
energy: Solar 

100% 

0% 

100% 

0% 

100% 

0% 

022 – Research and 
innovation 
processes, 
technology transfer 
and cooperation 
between enterprises 
focusing on the low 
carbon economy, 
resilience and 
adaptation to climate 
change  
025bis – Energy 
efficiency 
renovation of 
existing housing 
stock, demonstration 
projects and 
supporting measures 
compliant with 

68 

 
 
 
 
 
 
 
 
 
Climate 

Digital 

Measure/ 
Sub-
Measure 
ID 

22 

23 

24 

25 

Measure/Sub-Measure 
Name 

Budget 
(EUR 
m) 

Int. Field 

7 

3 

2 – Accelerating 
renovation of buildings 
and a sustainable urban 
environment –  Pilot 
renovation projects 
(public buildings) 

2 – Accelerating 
renovation of buildings 
and a sustainable urban 
environment –  
Digitalisation of 
renovation projects 

154.8 

2 – Accelerating 
renovation of buildings 
and a sustainable urban 
environment –  State 
incentive for the 
renovation of multi-
apartment buildings 
with organic materials 

96.6 

2 – Moving without 
polluting the 
environment –  
Purchase of clean 
vehicles 

energy efficiency 
criteria 
026bis – Energy 
efficiency 
renovation or energy 
efficiency measures 
regarding public 
infrastructure, 
demonstration 
projects and 
supporting measures 
compliant with 
energy efficiency 
criteria  
026bis – Energy 
efficiency 
renovation or energy 
efficiency measures 
regarding public 
infrastructure, 
demonstration 
projects and 
supporting measures 
compliant with 
energy efficiency 
criteria  
025bis – Energy 
efficiency 
renovation of 
existing housing 
stock, demonstration 
projects and 
supporting measures 
compliant with 
energy efficiency 
criteria 
074 – Clean urban 
transport rolling 
stock  

69 

Coeff. 
% 

100% 

Int. Field 

Coeff. 
% 

0% 

100% 

0% 

100% 

0% 

100% 

0% 

 
 
 
 
 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

25.2 

26 

27 

28 

29 

30 

31 

Measure/Sub-Measure 
Name 

2 - Moving without 
polluting the 
environment –  
Purchase of clean 
vehicles 
2 – Moving without 
polluting the 
environment –  
Expansion of 
refuelling/charging 
infrastructure 
2 – Moving without 
polluting the 
environment –  
Investments in electric 
buses (M2 or M3) 
2 – Moving without 
polluting the 
environment –  
Installation of 
recharge/charge 
infrastructure (public 
transport) 
2 – Moving without 
polluting the 
environment –  
Establishment of 
biomethane gas 
production capacity 
2 – Moving without 
polluting the 
environment –  
Installation of second-
generation biofuel 
production capacity 
2 – Moving without 
polluting the 
environment –  
Development of green 
hydrogen technologies 
and their use 

Climate 

Digital 

Budget 
(EUR 
m) 

3.4 

Int. Field 

074 – Clean urban 
transport rolling 
stock 

Coeff. 
% 

100% 

Int. Field 

Coeff. 
% 

0% 

72 

69 

6 

077 – Alternative 
fuels infrastructure 

100% 

074 – Clean urban 
transport rolling 
stock 

100% 

073 – Clean urban 
transport 
infrastructure 

100% 

22.21 

100% 

030bis – Renewable 
energy: biomass 
with high GHG 
savings 

8.7 

20 

100% 

030bis – Renewable 
energy: biomass 
with high GHG 
savings 

100% 

032 - Other 
renewable energy 
(including 
geothermal energy)  

70 

0% 

0% 

0% 

0% 

0% 

0% 

 
 
 
 
 
 
 
 
 
 
 
 
Climate 

Digital 

Budget 
(EUR 
m) 

46 

Int. Field 

077 – Alternative 
fuels infrastructure 

Coeff. 
% 

100% 

Int. Field 

Coeff. 
% 

0% 

Measure/Sub-Measure 
Name 

2 – Moving without 
polluting the 
environment –  
Installation of 
recharging points for 
private electric vehicles 
3 – Minimum 
conditions for 
innovative 
technological solutions 
in business and daily 
life –  Creation of 
technological resources 
for the Lithuanian 
language 
3 – Prerequisites for 
innovative 
technological solutions 
in business and daily 
life – Developing and 
deploying digital 
innovation 

35 

15 

Measure/ 
Sub-
Measure 
ID 

32 

33 

35 

36 

3 

3 – Prerequisites for 
innovative 
technological solutions 
in business and daily 
life –  Development and 
deployment of ESA and 
AI solutions  

010bis1 – Inc. e-
Commerce, e-
Business and 
Networked business 
processes, digital 
innovation hubs, 
living labs, web 
entrepreneurs and 
ICT start-ups, B2B 

71 

0% 

3-012 – IT services 
and applications for 
digital skills and 
digital inclusion 

100% 

0% 

0% 

100% 

100% 

2-009bis – Investment 
in digital-related R&I 
activities (including 
excellence research 
centres, industrial 
research, experimental 
development, 
feasibility studies, 
acquisition of fixed or 
intangible assets for 
digital related R&I 
activities) 
6-021ter – 
Development of 
highly specialised 
support services and 
facilities for public 
administrations and 
businesses (national 
HPC Competence 
Centres, Cyber 
Centres, AI testing 
and experimentation 
facilities, blockchain, 
Internet of Things, 
etc.)   

 
 
 
 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

37 

38 

39 

Measure/Sub-Measure 
Name 

3 – Prerequisites for 
innovative 
technological solutions 
in business and daily 
life –  Digitisation of 
cultural resources  
3 – Prerequisites for 
innovative 
technological solutions 
in business and daily 
life –  Digitisation of 
educational content and 
resources 
3 – Ensuring the 
effectiveness of data 
management and open 
data –  Development of 
a data management 
model and data transfer 
to the national data lake 

Climate 

Digital 

Budget 
(EUR 
m) 

30 

Int. Field 

Coeff. 
% 

0% 

Int. Field 

5-021bis – Support to 
digital content 
production and 
distribution  

Coeff. 
% 

100% 

20 

30 

0% 

0% 

72 

100% 

3-012 – IT services 
and applications for 
digital skills and 
digital inclusion 

100% 

6-021quater – 
Investment in 
advanced technologies 
such as: High-
Performance 
Computing and 
Quantum computing 
capacities/Quantum 
communication 
capacities (including 
quantum encryption); 
in Microelectronics 
design, production 
and system-
integration; Next 
generation of 
European data, cloud 
and edge capacities 
(infrastructures, 
platforms and 
services); Virtual and 
Augmented reality, 
DeepTech and other 
digital advanced 
technologies. 
Investment in securing 
the digital supply 
chain. 

 
 
 
 
 
 
 
 
Climate 

Digital 

Measure/ 
Sub-
Measure 
ID 

40 

Measure/Sub-Measure 
Name 

3 – Ensuring the 
effectiveness of data 
management and open 
data –  Creation of 
Euroconnector 

Budget 
(EUR 
m) 

0.5 

Int. Field 

Coeff. 
% 

0% 

Coeff. 
% 

100% 

100% 

100% 

Int. Field 

6-021quater – 
Investment in 
advanced technologies 
such as: High-
Performance 
Computing and 
Quantum computing 
capacities/Quantum 
communication 
capacities (including 
quantum encryption); 
in Microelectronics 
design, production 
and system-
integration; Next 
generation of 
European data, cloud 
and edge capacities 
(infrastructures, 
platforms and 
services); Virtual and 
Augmented reality, 
DeepTech and other 
digital advanced 
technologies. 
Investment in securing 
the digital supply 
chain. 
4-011 – Government 
ICT solutions, e-
services, applications 

3-012 – IT services 
and applications for 
digital skills and 
digital inclusion 

41 

42 

43 

3 – Client oriented 
services –  
Implementation and 
monitoring of the 
projects 
3 – Client oriented 
services –  Developing 
ICT tools for more 
efficient 
communication of 
persons with disabilities 
3 – Transformation of 
public information 

115.26 

2 

95 

0% 

0% 

012 – IT services 
and applications for 
digital skills and 
digital inclusion 

011 – Government 
ICT solutions, e-

0% 

4-011 – Government 
ICT solutions, e-

100% 

73 

 
 
 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

Measure/Sub-Measure 
Name 

Budget 
(EUR 
m) 

Climate 

Digital 

Int. Field 

Coeff. 
% 

Int. Field 

Coeff. 
% 

44 

45 

technology governance 
–  Development of ICT 
infrastructure 
3 – Transformation of 
public information 
technology governance 
–  Ensuring 
cybersecurity 
requirements 

3 – Step towards 5G –  
Delivering on 
Connectivity 
Innovation 

services, 
applications 

15 

0% 

24.5 

0% 

46 

3 – Step towards 5G –  
Infrastructure 

49 

0% 

47 

5 

4 – Competences for 
the green and digital 
transformation are 
acquired in vocational 
education and training –  
Updating the content of 
vocational education 

0% 

114 – Support for 
adult education 
(excluding 
infrastructure) 

74 

100% 

100% 

100% 

40% 

services, applications 

6-021quinquies – 
Development and 
deployment of 
cybersecurity 
technologies, 
measures and support 
facilities for public 
and private sector 
users.  
1-054 – Very High-
Capacity broadband 
network (access/local 
loop with a 
performance 
equivalent to an 
optical fibre 
installation up to the 
base station for 
advanced wireless 
communication) 
1-054 – Very High-
Capacity broadband 
network (access/local 
loop with a 
performance 
equivalent to an 
optical fibre 
installation up to the 
base station for 
advanced wireless 
communication) 
3-016 – Skills 
development for smart 
specialisation, 
industrial transition, 
entrepreneurship, and 
adaptability of 
enterprises to change  

 
 
 
 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

48 

49 

50 

51 

52 

57 

Measure/Sub-Measure 
Name 

and training (formal 
and informal 
programmes) 
4 – Competences for 
the green and digital 
transformation are 
acquired in vocational 
education and training –  
Apprenticeship 

4 – Competences for 
the green and digital 
transformation are 
acquired in vocational 
education and training –  
National mobility 
programme 
4 – Competences for 
the green and digital 
transformation are 
acquired in vocational 
education and training –  
Acquiring a profession 
in BU schools 
4 – Access to the 
development of 
competences and 
recognition of 
qualifications for adults 
–  LAG IT system 
4 – Access to the 
development of 
competences and 
recognition of 
qualifications for adults 
–  Developing LAG 
competences 

20 

6 

6 

2 

16.2 

4 – Modern general 
education as a basis for 
acquiring basic 

9.8 

Climate 

Digital 

Budget 
(EUR 
m) 

Int. Field 

Coeff. 
% 

Int. Field 

Coeff. 
% 

114 – Support for 
adult education 
(excluding 
infrastructure) 

114 – Support for 
adult education 
(excluding 
infrastructure) 

112 – Support for 
primary to 
secondary education 
(excluding 
infrastructure) 

011 – Government 
ICT solutions, e-
services, 
applications 

016 – Skills 
development for 
smart specialisation, 
industrial transition, 
entrepreneurship, 
and adaptability of 
enterprises to 
change  
112 – Support for 
primary to 
secondary education 

75 

0% 

0% 

0% 

0% 

0% 

40% 

40% 

40% 

100% 

40% 

3-016 – Skills 
development for smart 
specialisation, 
industrial transition, 
entrepreneurship, and 
adaptability of 
enterprises to change  
3-016 – Skills 
development for smart 
specialisation, 
industrial transition, 
entrepreneurship, and 
adaptability of 
enterprises to change  
3-016 – Skills 
development for smart 
specialisation, 
industrial transition, 
entrepreneurship, and 
adaptability of 
enterprises to change  
4-011 – Government 
ICT solutions, e-
services, applications 

3-016 – Skills 
development for smart 
specialisation, 
industrial transition, 
entrepreneurship, and 
adaptability of 
enterprises to change  

0% 

3-108 – Support for 
the development of 
digital skills 

100% 

 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

Measure/Sub-Measure 
Name 

Budget 
(EUR 
m) 

Climate 

Digital 

Int. Field 

Coeff. 
% 

Int. Field 

Coeff. 
% 

5 

(excluding 
infrastructure) 
047 - Support to 
environmentally-
friendly production 
processes and 
resource efficiency 
in SME 

40% 

0% 

62 

69 

70 

71 

72 

73 

74 

competences –  Digital 
education 
5 – Effective 
implementation of 
innovation policy and 
increased demand for 
innovation in the start-
up ecosystem and 
development of green 
innovation –  Fostering 
the development of 
green innovation 
6 – Improving tax 
compliance –  Training 
of municipal staff 

6 – Improving tax 
compliance –  
Infrastructure for non-
cash payments in  
educational 
establishments 
6 – Improving tax 
compliance –  Building 
ID information system 

1.3 

6 – Development of the 
electronic document 
ecosystem 

3.843 

5.1 

5 

6 – Smart tax 
administration to reduce 
the VAT gap faster  
 –  Quality data 
received/provided by 
financial institutions 
6 – Smart tax 
administration to reduce 
the VAT gap faster  
 VAT gap –  New Data 
Analysis Tools (STI) 

0.005454  114 – Support for 

0% 

adult education 
(excluding 
infrastructure) 

4.312512  086 – Infrastructure 

0% 

for primary and 
secondary education 

0% 

0% 

0% 

0% 

011 – Government 
ICT solutions, e-
services, 
applications 
011 – Government 
ICT solutions, e-
services, 
applications 
011 – Government 
ICT solutions, e-
services, 
applications 

011 – Government 
ICT solutions, e-
services, 
applications 

76 

3-108 – Support for 
the development of 
digital skills 

3-012 – IT services 
and applications for 
digital skills and 
digital inclusion 

4-011 – Government 
ICT solutions, e-
services, applications 

4-011 – Government 
ICT solutions, e-
services, applications 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

100% 

100% 

100% 

100% 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

 
 
 
 
 
 
Climate 

Digital 

Measure/ 
Sub-
Measure 
ID 

75 

Measure/Sub-Measure 
Name 

6 – Smart tax 
administration to reduce 
the VAT gap faster  
 VAT gap –  Process 
Robotisation (STI) 

Budget 
(EUR 
m) 

0.578 

Coeff. 
% 

0% 

Int. Field 

011 – Government 
ICT solutions, e-
services, 
applications 

Int. Field 

6-021quater – 
Investment in 
advanced technologies 
such as: High-
Performance 
Computing and 
Quantum computing 
capacities/Quantum 
communication 
capacities (including 
quantum encryption); 
in Microelectronics 
design, production 
and system-
integration; Next 
generation of 
European data, cloud 
and edge capacities 
(infrastructures, 
platforms and 
services); Virtual and 
Augmented reality, 
DeepTech and other 
digital advanced 
technologies. 
Investment in securing 
the digital supply 
chain. 
4-011 – Government 
ICT solutions, e-
services, applications 

Coeff. 
% 

100% 

100% 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

76 

77 

78 

6 – Smart tax 
administration to reduce 
the VAT gap faster  
 –  New data analysis 
tools and ICT 
(Lithuanian Customs 
6 – Smart tax 
administration to reduce 
the VAT gap faster  –  
Competence 
development 
(Lithuanian Customs) 
6 – Smart tax 

7.765 

1.552 

0% 

0% 

011 – Government 
ICT solutions, e-
services, 
applications 

088 – Infrastructure 
for vocational 
education and 
training and adult 
learning 

0.4 

016 – Skills 

0% 

3-016 – Skills 

40% 

77 

 
 
 
 
 
Measure/ 
Sub-
Measure 
ID 

Budget 
(EUR 
m) 

Measure/Sub-Measure 
Name 

administration to reduce 
the VAT gap faster  –  
Competency Model 
(STI) 

80.1 

83 

84 

86 

88 

6 – Long-term 
sustainability and 
transparency of the 
national budget –  
Improving national 
budget planning 
processes 
6 – Efficient public 
sector –  Human 
resources management 
system in the public 
sector 
6 – Tools available to 
business to manage 
insolvency risk 

1.4 

6 

3.24 

6 – A single window to 
pay fines  

5 

12.95 

7 – Client-centred 
employment support: 
Increasing the scope 
and diversity of 
employment support 
measures, contributing 
to the objectives of 
digital and green 
transformation and 
promoting the circular 
economy –   Measures 
to promote 
entrepreneurship 
(digitisation) 

Climate 

Digital 

Int. Field 

Coeff. 
% 

Int. Field 

Coeff. 
% 

development for 
smart specialisation, 
industrial transition, 
entrepreneurship, 
and adaptability of 
enterprises to 
change 
011 – Government 
ICT solutions, e-
services, 
applications 

development for smart 
specialisation, 
industrial transition, 
entrepreneurship, and 
adaptability of 
enterprises to change 

0% 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

011 – Government 
ICT solutions, e-
services, 
applications 

011 – Government 
ICT solutions, e-
services, 
applications 
011 – Government 
ICT solutions, e-
services, 
applications) 
100 – Support for 
self-employment 
and business start-up 

0% 

0% 

0% 

0% 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

4-011 – Government 
ICT solutions, e-
services, applications 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

100% 

3-100 – Support for 
self-employment and 
business start-up 

40% 

78 

 
 
 
 
 
Climate 

Digital 

Budget 
(EUR 
m) 

12.14 

Coeff. 
% 

100% 

Int. Field 

01 – Contributing to 
green skills and jobs 
and the green 
economy 

Int. Field 

Coeff. 
% 

0% 

46.2626 

108 – Support for 
the development of 
digital skills 

0% 

3-108 – Support for 
the development of 
digital skills 

100% 

7.11 

011 – Government 
ICT solutions, e-
services, 
applications 

0% 

4-011 – Government 
ICT solutions, e-
services, applications 

100% 

Measure/ 
Sub-
Measure 
ID 

89 

90 

92 

Measure/Sub-Measure 
Name 

7 – Client-centred 
employment support: 
Increasing the scope 
and diversity of 
employment support 
measures, contributing 
to the objectives of 
digital and green 
transformation and 
promoting the circular 
economy –  Measures 
to promote 
entrepreneurship (green 
course) 
7 – Client-centred 
employment support: 
Increasing the scope 
and diversity of 
employment support 
measures, contributing 
to the objectives of 
digital and green 
transformation and 
promoting the circular 
economy –  Digital 
skills 
7 – Client-centred 
employment support: 
Increasing the scope 
and diversity of 
employment support 
measures, contributing 
to the objectives of 
digital and green 
transformation and 
promoting the circular 
economy –  
Employment platform 

79