The Centre Union's election programme may be characterised as rather ambivalent and inconsistent. Measures that are intended to help achieve the goals of the programme are vaguely defined.

The main objectives of the platform

Privatisation. Privatisation issues are mentioned only as far as infrastructure is concerned. It is stipulated that state control will be retained in the Elektrėnai and Kruonis electric power plants which form a single complex with the Ignalina nuclear power plant. Privatisation of transportation companies - the Lithuanian Airlines and the Lithuanian Railway - will depend on economic and social effects of the privatisation. The programme also highlights the need to define what will remain under state ownership. It is likely that privatisation would not be halted; however, certain "strategic" enterprises would be either not privatised or privatised by requiring the buyers to assume heavy social obligations.

Foreign investments. The Centre Union will seek to attract capital and stimulate Lithuanian and foreign capital investments by creating "equal conditions for competition." Presumably, tax breaks that were granted to foreign investors in the past will remain in effect.

Taxation. The Centre Union proposes to reduce the tax burden, to increase the tax-exempt minimum wage and to differentiate value added tax charged for heating services, food products, rural businesses, and housing construction services. The corporate income tax is to be reduced to 15 percent, while a zero tax rate is to be applied for at least five years in order to stimulate the economy.

Business conditions. One of the main slogans of the Centre Union refers to the removal of excessive prohibitions, regulations, inspections and other constraints, but no specific measures that would help to achieve this are indicated. The platform advocates the development of small and medium sized enterprises and provision of state aid to selected business categories (regional, exporting, construction, etc.).

Agricultural policy. The Centre Union advocates the creation of "a network of strong, competitive farms that would provide high-quality products and create jobs in agriculture." Another aim is to stimulate alternative activities in rural areas. Various interventionist measures are proposed, from setting priorities in the agricultural sector to providing direct payments and compensations for expenditures for energy resources. The prospects of reforming the agricultural sector are questionable. The Centre Union also advocates the completion of land restitution, but the position on eliminating the division of and into agricultural and non-agricultural plots as well as on allowing legal persons and foreign citizens to buy agricultural land is unclear. Public utterances from the party leaders suggest that no steps will be taken in this direction.

Monetary policy. The programme does not define any position on monetary policy and the role of the central bank. The Centre Union lacks a clear position on this issue and would take over a position proposed by possible coalition partners, which, in its turn, would be affected by integration into the European Union and the preparation for membership in the Monetary Union.

Budget policy. The programme stipulates that programme budgeting should be mandatory and expenditures for programme implementation should be separated from expenditures for institutions' operational activities. A gradual transition to fiscal decentralisation by giving more leverage to municipalities with respect to tax policy is proposed. No specific measures are mentioned though.

Social policy. The Centre Union proposes a reform of the social security system and the establishment of a multi-level pension system. Concrete measures are described very vaguely. The aim is declared to create "an atmosphere of trust in pension funds and a system of guarantees," to create mandatory insurance funds and to stimulate activities of private insurance funds. As far as education, science and healthcare policies are concerned, the Centre Union provides declarative statements about their "priority role" and procedural recommendations. The party proposes increasing budget expenditures for education.

Foreign policy. The Centre Union supports integration into the European Union, highlighting the need to take into consideration public opinion about such issues as agriculture, job creation, the energy sector, and environment protection. The party is likely to negotiate for longer transition periods in these areas, especially for the closure of the Ignalina nuclear power plant and selling agricultural land to foreign citizens. They also advocate acceleration of integration into NATO, but at the same time they declare the necessity to co-ordinate the establishment of a national defence system with the needs in such areas as education, most likely referring to budget spending.

Policy Implications

It is likely that some barriers to business growth would be removed, but government aid for priority sectors would result in the establishment of new administrative institutions and an increase in budget expenditures. A budget deficit and the use of privatisation proceeds for various assistance programmes are very possible. Privatisation will be continued, but methods of privatisation are unlikely to be improved. Buyers of state property may be required to assume a number of social obligations. Conditions for foreign investors are unlikely to deteriorate, but indirect discrimination against them is possible by giving support to local enterprises. Economic policy, especially in areas in which no clear position is defined, will depend on such factors as coalition partners, bureaucratic inertia, the level of expertise, and international obligations and integration into the European Union.