Advice on budget planning and review of public expenditures

The review of public expenditures is a process designed to determine how effectively ministries and agencies under the management of ministers utilize state budget allocations and other funds for long-term activities. This process analyzes the expenses incurred by agencies within the ministers’ areas of responsibility, and the well-founded results allow decisions to be made regarding the implementation of ongoing measures and/or changes in financing.

The Organisation for Economic Co-operation and Development (OECD), the European Commission, and other international organizations recommend public expenditure reviews as an advanced practice. This approach ensures more efficient public fund planning through effective expenditure control, identifies potential savings, and provides opportunities to reallocate funds to priority areas.

So far, public expenditure reviews in Lithuania have not been conducted systematically, with only pilot projects implemented.

On April 28, 2021, the Government adopted Resolution No. 292 on the Approval of the Strategic Management Methodology (lrs.lt), which established the main legal provisions for the concept and procedure of public expenditure reviews.

Currently, expenditure reviews are conducted in accordance with the Methodological Guidelines for Public Expenditure Review, approved by the Minister of Finance’s Order No. 1K-227 of June 28, 2021, “On the Amendment of the Application of the Strategic Management Methodology,” which states that the public institution Central Project Management Agency carries out expenditure reviews under the instructions of the Ministry of Finance of the Republic of Lithuania.

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