Lithuania is experiencing rapid demographic change, with the population ageing and significantly shrinking in recent decades, and expected to continue in the coming years. This has put pressure on the provision of public services, especially at the municipal level.
This report provides insights on those pressures and recommendations that can address them, whilst also mitigating territorial disparities, fostering social inclusion and enhancing the accessibility, affordability and quality of essential public services.
Lithuania requested support to on-going structural reforms from the European Commission (DG Reform) under Regulation (EU) 2021/240 establishing a Technical Support Instrument. The request was assessed by the European Commission in accordance with the criteria and principles referred to in Article 9 of the TSI Regulation. Following the assessment, the European Commission decided to fund the request and provide technical support to Lithuania. The European Commission has awarded grant to the Organisation for Economic Co-operation and Development (OECD) to provide assistance based on the request from Lithuania.
The action contributes to ongoing efforts by Lithuania on its nationally applicable legal, fiscal and institutional framework to enable shared service provision across several municipalities and includes findings from a pilot of this framework conducted in the TAURAGĖ+ functional zone in Lithuania in 2018-2023.
The report also draws lessons from peer country experiences, and in particular Finland, as requested by Lithuanian authorities, where inter-municipal cooperation has been used successfully for decades.
This report takes stock of the challenges inherent to the legal, fiscal and institutional frameworks for shared service provision in Lithuania, such as the gaps and weaknesses of national laws and regulations to facilitate collaboration at the municipal level, the lack of specific guidance to engage in inter-municipal experiments, sectoral fragmentation and the low financial autonomy of municipalities, which reduces incentives to identify cost-saving measures.
Along with the recommendations, the report also provides two roadmaps for piloting primary healthcare and LTC services in Tauragė+ functional zone (Jurbarkas, Pagėgiai, Šilalė, Tauragė municipalities), as requested by the Lithuanian authorities.
The report was approved on 26 August 2024 by written approval procedure under the reference [CFE/RDPC(2024)5].