RIGA - The number of employees at the Latvian Ministry of Economy has been slashed by 25 percent, to 230, as reorganization efforts are carried out, reports news agency LETA. Up to June 1 of this year, the number of deputy state secretaries has been cut from five to two; nine out of 13 departments remain operating, and the number of subdivisions at the ministry been cut from 46 to 27.
Altogether, 333 staff positions, or 22 percent of the total number in the Ministry of Economy and institutions under its supervision have been liquidated since July 30, 2008, when 1,541 people were employed there; now just 1,208 remain.
Currently three state agencies remain under supervision of the Ministry of Economy - the Investment and Development Agency of Latvia (LIDA) , the State Tourism Development Agency, the Construction, Energy and Housing State Agency, the latter planned to be liquidated in the second half of next year after it transfers its functions to LIDA, and the state Privatization Agency.
A number of Economy Ministry's state agencies have been merged and reorganized. For example, the structure and operations of the State Tourism Development Agency were optimized by closing down its London bureau; several tourism information centers in Latvia's regions and one in Riga were closed; 52 percent of the agency's employees were laid off.
Prime Minister Valdis Dombrovskis (New Era) had previously demanded that all ministries be required to reduce their staff number and salaries, with a deadline set for September 1, 2009.
Regional Development and Local Government Affairs Minister Edgars Zalans (People's Party) submitted his state administration reform plan to the government. The reforms Zalans proposes include merging several ministries, reducing the number of ministries from fourteen to eight.
Zalans suggests that the Ministry of Defense, Foreign Affairs Ministry, Finance Ministry and Agriculture Ministry should continue operating as before. The Ministry of Economy, Regional Development and Local Government Affairs Ministry, Transport Ministry and Environment Ministry could all be merged into one - the Development Ministry, he proposes. The Education and Science ministry could be combined with the Culture Ministry, and the Interior Ministry and Justice Ministry joined to form the Justice and Public Order Ministry. He allows the Welfare Ministry and Health Ministry to be merged into a Ministry of Health and Welfare.
His five basic principles guiding reform are: giving more authority and responsibility to all the ministers; making the central administration structures of ministries small and compact; delegating the responsibility for state administration services to the regional state administration level, local governments and private sector; merging ministries' regional institutions and regional administration institutions, transferring their functions to local governments; further development of Latvia's 'e-government.'
"I believe that further simplified, mechanical budget cuts must not take place anymore," said Zalans, explaining that such budget cuts may have an unpredictable effect on residents. "The state administration reform is a crucial part of the discussions on drawing up the budget, which will allow us to weigh up the necessary budget cuts," had says.
Zalans wishes to see a state administration system that works in a fast, efficient and harmonized way, ensuring implementation of its basic functions as well as development. The structural reforms of the state administration system must be considered in a broader perspective, not just within the ministries, and agreement must be reached on reducing the number of the ministries, Zalans points out.
"The changes taking place in Latvia are not reforms," counters Auditor General Inguna Sudraba. In her opinion, carrying out healthcare reform would mean, for example, the government setting up a list of healthcare services it undertakes to provide, then draw up a plan on how to provide them best. Consequently, a corresponding number of staff to ensure these services are fulfilled would then be designated.
"I do not see closing down schools and reducing the number of teachers as reform. Reform means understanding what education content we plan to provide, what education quality we can ensure and what steps should be taken to ensure the quality," says Sudraba.
Sudraba does not consider the introduced changes in the state administration system as reforms, either. She notes that it is simply a merging and reducing the number of state institutions that is going on now. These changes allow for the rationalization, or cutting of costs, but do not necessarily provide a platform for carrying out the institutional functions in a different, better way. These reforms will not be a cure for the economic crisis and the measures taken so far do not correspond to the actual economic situation, believes Sudraba.
Additionally, the EU funding appropriation plans have not changed since they were drawn up, back in 2007, when the economic environment and national priorities were completely different. This also proves something regarding political competence and understanding, said Sudraba.
