• Lithuania fails to ensure a consistent innovation pathway from research to market – the largest share of funding goes to product development and exports (EUR 1.83 billion), while significantly less is allocated to research and prototyping (EUR 206.7 million and EUR 491 million respectively).
• Funding measures operate as a set of separate instruments, making it more difficult for businesses to move seamlessly through all stages of innovation development, from research to commercialisation.
• Even once a product has been developed, its value often remains unprotected – of the 30 projects assessed by the auditors, only one result was patented, although in 27 cases products were developed or commercialised.
• The National Audit Office recommends establishing a coherent innovation funding chain and ensuring consistent support throughout the entire patenting process.

In Lithuania, 174 funding instruments have been established to promote business innovation, but they do not form a coherent chain stretching from research to a market-ready product protected by intellectual property rights. An audit carried out by the National Audit Office, entitled “Business Innovation Promotion System”, revealed that significantly less funding is allocated to the early stages of innovation development than to product development and export, and even products that have been developed or commercialised are rarely protected by intellectual property rights.
  
As a result, the innovation process can be disrupted at two points – when promising ideas move from one development stage to the next, and when seeking to protect results that have already been created and turn them into a long-term competitive advantage.
 
“Innovation policy cannot end with the allocation of funding. The state’s objective is to create the conditions for as many ideas as possible to go the whole way from research to the market and become solutions protected by intellectual property rights. Isolated measures are not enough for this – a coherent system is needed to transform public investment into long-term benefits for the country’s economy,” says Auditor General Irena Segalovičienė.
  
Funding measures do not ensure a coherent innovation chain
  
In the first half of 2022–2025, 174 funding measures were implemented in Lithuania to promote business innovation, with a total budget of over EUR3 billion.
  
The largest share of funding was allocated to the development and export of products – EUR 1.83 billion. EUR 491 million was earmarked for prototype development, and EUR 206.7 million for research. This indicates that the innovation funding system is more focused on the middle and late stages of the innovation cycle, while less attention is paid to the early stages of innovation development.
  
The audit revealed that the funding measures operate as a set of separate instruments rather than a coherent system. Due to insufficient coordination between them, it is more difficult for businesses to progress consistently through all stages of innovation development, from research to bringing a product to market; as a result, some projects never reach the market. This is also confirmed by the audit findings – not a single project was identified that had received funding at at least two consecutive stages of the innovation development chain.
  
The value created is not always protected
  
The audit revealed that even after a product has been developed or commercialised, its intellectual property often remains unprotected. Of the 30 projects assessed, products were developed or commercialised in 27 cases, but only one was patented. This indicates that products created with state investment are not always protected by intellectual property rights.
  
The insufficient attention paid to intellectual property protection is also reflected in the country’s overall patenting indicators. Between 2022 and 2025, an average of 26 national patents per million inhabitants were granted in Lithuania each year. It is worth noting that the number of patent applications in Lithuania is more than three times lower than the European Union average – in 2024, 45 patent applications were filed per million inhabitants in Lithuania, while the EU average stood at 152.
  
This is due to systemic factors. It takes an average of 2–5 years for a patent to be granted, but measures to compensate for patenting costs are only valid for 1–24 months, meaning that companies may not have time to take advantage of them. Businesses also lack information about the options for protecting intellectual property.
  
From isolated measures to a coherent innovation system
  
The National Audit Office recommends moving from isolated funding measures to a coherent innovation promotion system that would ensure consistent project funding at all stages – from research to bringing the product to market. It is also proposed to establish consistent financial and expert support throughout the entire patenting process – from the generation of R&D results to ensuring the long-term validity of the patent.
  
The aim of implementing these recommendations is to increase the proportion of projects receiving funding at least at two consecutive stages of the innovation chain from 0 to 30 percent, and the proportion of R&D project results that are patented or protected by other intellectual property measures from 3 percent to 20 percent.

More than half of Lithuanian general education schools still lack educational support specialists. Although the state and local authorities are increasing funding, implementing measures to attract specialists and encouraging people to choose these professions, the shortage of specialists persists. An audit carried out by the National Audit Office, “Educational Support in Schools”, revealed that, as a result, the specialists currently working in this field face heavy workloads, and a significant proportion of their working time is spent on administrative tasks rather than providing direct support to children.
  
“If we want inclusive education to be more than just a slogan on paper, we must urgently turn our attention to those who work with children on a daily basis. Educational support specialists and teaching assistants cannot perform their duties to a high standard when, on the one hand, they are trying to manage several complex cases of behavioural difficulties across different classes, while, on the other, they are forced to fill in endless, constantly changing reports. The audit results clearly show that reducing the administrative burden and filling vacant posts would not only improve the availability of services for pupils but would also fundamentally change the well-being of the specialists themselves, which is currently bordering on professional burnout. We must eliminate methodological chaos and provide schools with practical tools and competitive remuneration in order to attract the necessary skills,” emphasises Auditor General Irena Segalovičienė.
  
Heavy workloads – the biggest obstacle to helping children
  
The audit figures clearly illustrate the systemic shortage of specialists. In 2025, 52 percent of general education schools were short of at least one educational support specialist, and each specialist was responsible for between 16 and 337 pupils, depending on the school. Although as many as 76 percent of the selected local authorities implement various measures to attract or retain specialists, there is still a critical shortage of them in the labour market. In 2025, employers across the country were seeking 1,157 educational support specialists, while the number of jobseekers was almost three times lower.
  
A survey of educational support specialists carried out by the National Audit Office confirmed that excessive workloads are the single greatest obstacle preventing the provision of high-quality support to children. Due to a shortage of staff, existing specialists are forced to deal with a significantly excessive number of pupils, leaving critically insufficient time for direct, individual support.
  
Heavy workloads for specialists affect not only the children who need support, but also the teachers. In a survey carried out during the audit, as many as 41 percent of the teachers surveyed stated that they did not receive sufficient support from educational support specialists, as the latter are either fully occupied at school or their posts are simply unfilled.
  
Bureaucratic burden takes time away from children
  
Educational support specialists themselves cite the administrative burden as one of the biggest obstacles to their work. According to the National Audit Office’s survey, as many as 69 percent of educational support specialists stated that administration, preparing for meetings and other indirect activities account for a moderate or significant proportion of their daily work. The specialists also highlighted this issue during the auditors’ visits to schools. According to them, educational support specialists spend a large part of their working day filling in assessment tables, preparing and refining individual education plans, writing minutes and reports, completing constantly changing assessment forms, and carrying out other administrative tasks.
  
In the schools’ view, reducing the administrative burden would allow specialists to devote considerably more time to direct interaction with children, improve the availability of support, and reduce the emotional and professional strain on the staff themselves.
  
The work of educational support specialists is also hampered by a lack of methodological guidance and clear working standards. In the absence of standardised assessment tools and clear methodologies, they are forced to work according to varying practices, adapt to changing requirements and devote additional time to documentation. This increases the administrative burden and reduces the time that could be devoted to the children’s needs.
  
Teaching assistants also face heavy workloads
  
Similar systemic problems also weigh heavily on teaching assistants. In the survey, they indicated that a single assistant is often assigned to support 3–4 pupils in different classes, or to look after as many as 6–8 children with special educational needs in a single class at the same time. This means that a single staff member is often faced with several particularly complex cases of behavioural or emotional difficulties at once.
  
Teaching assistants emphasise that children need support not only during lessons, but also during breaks, in the canteen, after school or during extracurricular activities; however, their working hours are usually scheduled exclusively for lessons. For this reason, they are physically unable to be where help is most needed, meaning that some pupils and teachers are left without any support during lessons.
  
The lack of clarity regarding their duties also causes additional stress – as many as 24 percent of the teaching assistants surveyed stated that they carry out additional tasks that are entirely outside their remit, such as standing in for teachers who are ill or absent, preparing assignments or marking pupils’ work. The teaching assistants themselves emphasise that clearer regulation of their duties and stronger support from teachers and the school administration would allow them to focus on their core mission – providing high-quality support to children in the educational process.
  
To retain specialists, it is not enough simply to attract new ones: the National Audit Office offers its recommendations
  
With a view to preventing staff burnout and ensuring that the support provided genuinely meets children’s needs, the National Audit Office has made specific recommendations to the Ministry of Education, Science and Sport (MESS) and its subordinate institutions. First, in order to create an effective educational environment and systematically address the problem of staff shortages, the Ministry is recommended to introduce open-class models. To this end, it is necessary to update the criteria under which a second teacher or a person providing educational support must be assigned to certain classes in primary and basic education.
  
It is also necessary to ensure continuous monitoring of the provision of educational support so that policy decisions are made on the basis of real data. To achieve this, it is recommended that schools be required to record, in the Pupil Register, the actual extent of support provided by the recommended educational support specialists to each pupil.
  
Finally, in order to eliminate methodological inconsistencies and ensure that specialists from all educational psychology services and schools across the country assess pupils’ needs in a uniform manner, it is recommended that the Lithuanian Centre for Inclusive Education develop and implement a uniform standard for the pedagogical and psychological assessment of children and ensure the procurement or development of the necessary assessment tools.

• The income tax relief measures introduced for the period 2022–2024 to encourage innovative activity cost the state budget an average of EUR 179 million per year.
• Fewer than half (41 percent) of the companies that received direct innovation support also took advantage of the tax relief for research and experimental development (R&D).
• Over a three-year period, the total number of companies making use of the relief fell by 5 percent.
• The National Audit Office recommends simplifying the process for claiming the relief and reducing the administrative burden, particularly for small businesses.

The state encourages business innovation not only through direct funding but also through tax incentives. However, the National Audit Office’s audit revealed that one of the most important tax relief schemes designed to promote innovation is not reaching a significant proportion of innovative businesses. Less than half (41 percent) of companies that received direct innovation support make use of the R&D tax relief.
  
“The R&D tax relief is currently failing to deliver its intended value because the state itself is erecting bureaucratic barriers in its path. When more than half of companies opt out of the relief solely because of the administrative burden and the requirement to duplicate data that the authorities already hold in their registers, we are failing to realise the enormous potential for the use of state resources. Tax incentives must encourage an innovative breakthrough, rather than imposing on businesses functions that a digitalised state can perform itself,” says Auditor General Irena Segalovičienė.
  
Only a part of innovative businesses take advantage of tax relief
  
Although the state promotes innovation through both direct funding and tax relief, not all companies take advantage of these opportunities. Of the 301 companies that received direct state support for innovation, only 122 (i.e. 41 percent) additionally took advantage of the R&D tax relief. Furthermore, the total number of companies taking advantage of the relief fell from 2,869 to 2,714 over a three-year period.
  
Why are businesses not making use of the relief?
  
The audit found that the main obstacles are complex administration, extensive documentation requirements and uncertainty regarding the evaluation of R&D activities.
  
The companies surveyed most frequently stated that the incentive was not relevant to them due to a lack of profit in the early years of operation (24 percent), a lack of expertise to properly document R&D activities (17 percent), the administrative process being too complex and time-consuming (16 percent), while some companies fear that the declared expenditure will not subsequently be recognised as R&D activity.
  
It has been found that the system still involves excessive procedures. In order to benefit from tax incentives or funding for the development and implementation of innovations, companies are required to submit documents that government bodies already hold in their records. For example, applicants are asked to resubmit annual income tax returns or R&D expenditure reports to the Innovation Agency and the Central Project Management Agency, even though these documents have already been submitted to the State Tax Inspectorate or the State Data Agency.
  
The audit also revealed that the administrative burden places a particularly heavy strain on small and micro-enterprises. Although almost half of the enterprises benefiting from R&D tax relief are micro-enterprises, they are subject to the same documentation requirements as large enterprises.
  
What the National Audit Office proposes
  
The National Audit Office recommends simplifying access to the R&D tax relief and reducing the administrative burden on businesses. It is proposed to introduce a model of standardised rates, to develop solutions for the exchange of information between the State Tax Inspectorate, the State Data Agency and the administering authorities regarding the use of R&D expenditure data, to clarify the descriptions of project funding conditions, and to ensure that applicants do not have to repeatedly submit data already held by state institutions. It is also recommended to extend the application of tax incentives for innovation, which would encourage the creation, protection and commercialisation of intellectual property, and to review excessive administrative requirements.
  
It is expected that, once these recommendations are implemented, a significantly larger proportion of companies that have received direct state support for innovation will benefit from the R&D tax relief – the aim is to increase this proportion from 41 percent to 80 percent.
  
State incentives must not only be financially attractive but also easily accessible. The lower the administrative burden on businesses, the greater the likelihood that tax relief will encourage investment in innovation and generate a higher return for the state.