In 2023 social protection expenditure increased by 4 %

Central Statistical Bureau (CSB) provisional data show that in 2023 Latvian social protection expenditure amounted to 7 billion 79.5 million euro, which is 272.7 million euro or 4 % more than in 2022. As more resources were spent to compensate for the energy price rise, expenditure on the function housing went up the most – by 55.3 %. Expenditure on the functions disability and old age grew as well (by 15.7 % and 13.6 %, respectively).

Reduced expenditure was registered for the functions social exclusion (22.2 %), family/children (10 %), and sickness/health care (6.6 %).

Social protection expenditure in Latvia

(annual, million euro)

Refer to the OSP database: PPI010

Expenditure on the housing allowance increased by 60.3 %

As more resources were spent to compensate for the rise in energy prices, expenditure on housing allowance increased by 17.6 million euro or 60.3 % and reached 47 million euro (29.4 million euro in 2022). According to the Ministry of Welfare, the number of housing allowance recipients went up by 6.8 thousand (from 73.1 thousand in 2022 to 79.9 thousand in 2023). However, the total expenditure on the function housing has grown by 55.3 % over the year.

Higher municipal expenditure on personal assistance to people with disabilities

Expenditure on the function disability increased by 15.7 % in 2023. Due to higher remuneration of personal assistants and companions, municipal expenditure on personal assistance for persons with disabilities increased by 41 % and reached 49.1 million euro. Moreover, with an aim to compensate for the increase in energy prices, additional resources were allocated to support people with disabilities in paying their electricity, natural gas, and heating bills and costs.

Expenditure on the old-age pensions up by 14 %

The bulk (44.8 %) of social protection expenditure went to the population at retirement age, moreover the largest share – 88.8 % making up 2.8 billion euro – was spent on old-age pensions. Driven by the pension index adjustments made in 2023, the total social protection expenditure on the function old age increased by 13.6 %, compared to 2022. Increased expenditure on this function was also affected by the State measures for the reduction of exceptional increase in energy resource prices, which provided stronger support to people at retirement age.

Expenditure on the survivor's pensions up by 14 %

The pension index adjustments made in 2023 as well as higher amount of the minimum survivor's pension resulted in the expenditure on survivor's pensions growing by 14 %. The total expenditure on the function survivors rose by 10 %, compared to 2022.

Number of GMI beneficiaries down by 24.9 thousand over the year

Along with a reduced number of guaranteed minimum income (GMI) beneficiaries and smaller expenditure on  social assistance to Ukraine civilians, expenditure on measures to fight social exclusion fell by 22.2 % last year. Expenditure on GMI benefit fell by 35.1 %, down to 13.8 million euro. According to the Ministry of Welfare, the number GMI beneficiaries (incl. Ukraine civilians receiving GMI benefit) has gone down by 24.9 thousand over the year (from 58.2 to 33.3 thousand). Reduced expenditure on social assistance to Ukraine civilians was caused by smaller number of the war refugees who arrived in Latvia last year (23.3 thousand in 2022 and 4.4 thousand in 2023).

Support to families with children gone down by 10 %

Mainly driven by the support to compensate for high energy prices (81 million euro in 2022), expenditure on the function family/children fell by 10 % in 2023.

Expenditure on health care down by 6.6 %

After the increased expenditure on the function sickness/health care in 2020–2022 and due to the end of the pandemic phase of COVID-19, expenditure on this function went down by 6.6 % last year. Expenditure on outpatient care fell by 13.6 %, to 568.7 million euro, and expenditure on sickness benefit¹ by 8.4 %, to 318.2 million euro.

In terms of the total expenditure on social benefits of the GDP, Latvia ranks first among the Baltic countries

Expenditure on social protection benefits (benefits, pensions, administrative and other costs) took 18.1 % of the gross domestic product (GDP) last year, which is 0.8 percentage points fewer than in 2022 (18.9 %).  Comparison of the 2022 and 2023 figures among the Baltic states shows reduced expenditure in all three countries: down by 0.7 percentage points in Latvia (from 18.6 % to 17.9 %), 0.1 percentage points in Lithuania (from 16.3 % to 16.2 %), and 0.1 percentage points in Estonia (from 15.4 % to 15.3 %). In the EU, expenditure on social protection benefits took on average 26.9 % of GDP in 2022.

Expenditure on the social protection benefits per capita made up 3.7 thousand euro

The share of social protection expenditure of the GDP is just one of the variables used for measuring social protection expenditure. Annual expenditure on social protection benefits per capita is also used for this purpose. In 2023³, Latvian figure (3.7 thousand euro per capita) was slightly lower than in the neighbouring Baltic countries (4.1 thousand euro in Lithuania and 4.3 thousand euro in Estonia).Over the year, expenditure on social protection benefits per capita grew by 4.1 % in Latvia, 4.8 % in Lithuania and 2.2 % in Estonia.

Methodological information

Since 2004, social protection expenditure statistics in Latvia is compiled based on the ESSPROS (European System of integrated Social PROtection Statistics) methodology. The methodology is aimed at producing internationally comparable information on social protection expenditure diverted from state and local government budgets to meet population needs in this area.

¹ Excluding sickness benefits paid due to an accident at work or occupational disease.

² 2023 data – early estimates for ESSPROS main indicators regarding expenditure on social protection benefits.

³ 2022 data – early estimates for ESSPROS main indicators.

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More information on data:
Kārlis Smudzis
Social Statistics Data Compilation and Analysis Section
E-mail: Karlis.Smudzis@csp.gov.lv
Phone: +371 67366948