Mārtiņš Kazāks, the President of the Bank of Latvia, recently expressed his concerns regarding the idea of allowing citizens to withdraw savings from their second-pension level. He argued that this proposal is a form of populism that could lead to severe long-term consequences, particularly for poorer segments of the population. Kazāks pointed out that experiences from Estonia, where such withdrawals were previously permitted, showed painful results which should serve as a cautionary tale for Latvian policymakers. Moreover, he noted that Lithuania allowed this kind of withdrawal this year, and the outcomes will be closely observed.

Kazāks emphasized that the second-pension level in Latvia should not be exploited for immediate consumption since it could create significant hardships for those who are already economically vulnerable. He criticized the notion of using pension funds as 'helicopter money' during times when the economy is reportedly growing and unemployment is low. According to Kazāks, any support for citizens should be targeted and tailored towards those who genuinely need it rather than broadly withdrawing pension savings for short-term fiscal relief.

This discussion around pension savings reflects broader economic and social considerations in Latvia, particularly as the country examines how to maintain financial stability and support its citizens effectively. Kazāks' comments highlight the delicate balance policymakers must strike between immediate economic relief and the long-term sustainability of pension savings, which are essential for future retirement security.