Private sector poaching government employees

RIGA - In order to prevent experienced specialists from leaving the state administration, the Finance Ministry suggests increasing salaries for employees in the administration, reports LETA. The ministry’s spokesman, Aleksis Jarockis, said that, as Latvia’s 2015 European Union presidency approaches, the issue of qualified state administration personnel’s motivation has become very important.

Taking into account that many state administration employees, due to the small salaries, have left for the private sector, it is necessary to establish a motivational system which would allow keeping the most capable employees.
Finance Minister Andris Vilks (Unity), though, emphasized that the total payroll in public administration could not be increased in the next two years, nevertheless, heads of state agencies and institutions should be more flexible in deciding how to distribute the available funding. That is, they have to decide whether to reduce staff and increase salaries for the remaining employees, or to keep the staff and wages unchanged.

Vilks believes that the salary system should be more motivating, so that quality specialists could be hired by state institutions.
The ministry notes that Jan. 1, 2010, when the law on salaries for officials and employees at state and municipal institutions came into force, the government had to carry out severe austerity measures. Therefore, several significant restrictions to the employees’ motivational system were introduced in the law. The employees could not receive bonuses and several benefits were reduced or “frozen.” The restrictions came into force in 2009, and are still being observed.

In the middle of 2009, the government also decided to reduce state administration employee salaries. Salaries above 300 lats (428 euros) were reduced by 20 percent, while those below 300 lats were reduced by 15 percent. On Jan. 1, 2010, the salaries were reduced by another five percent.

According to the Central Statistical Bureau’s data, state administration employee salaries fell by 23 percent from 2008 to 2010, while salaries for employees in the private sector fell by 2.5 percent.