Yesterday, FICIL chairperson of the Board, Zlata Elksniņa-Zaščirinska, participated in a TV show “Kas notiek Latvijā?”, together with the Minister for Economics – Viktors Valainis, Minister for Finance – Arvils Ašeradens, Member of the Parliament – Skaidrīte Ābrama, and representatives of the the three largest employers’ organisations – Employers’ Confederation of Latvia (LDDK), Finance Latvia Association (FNA), and Latvian Chamber of Commerce and Industry (LTRK). The discussion focused on the government spending and bureaucracy reduction. Specifically, on areas, where budgetary cuts could be made, and on methods to reduce the government spending by 5% (or 850 mln. EUR) to redirect resources towards the defence sector. The latter was suggested by the largest employers’ organisations in Latvia – Foreign Investors’ Council in Latvia (FICIL), LDDK, FNA, and LTRK, when they signed a joint memorandum in January.
Zlata Elksniņa-Zaščirinska reiterated the long-standing position of FICIL to centralise administrative functions that are being duplicated across ministries to increase government spending efficiency. Such functions include IT, accounting, public procurement and other functions that are being performed by each ministry. In case of centralisation of administrative functions and the consequent formation of shared service centres for the entire public administration, a significant amount of resources may be saved. Additional associated benefits of such solution include better data management systems, due to data centralisation, higher quality of performed functions, due to concentration of competences, and lower administrative burden for the public sector employees and other end-users.
Among the key issues that have been discussed during a TV show was the motivation of the public sector institutions to restructure themselves, given that it may incur a loss of jobs and disturbance of processes at respective institutions. In view of Zlata, it is critical to have the political commitment to set a target of reducing the government spending by 5%, as it would oblige organisations to identify ways to make the public sector reform possible. The employers’ organisations believe that each ministry and associated public institutions know where such inefficiencies exist, however, an audit is needed to support the process and help to make, at times, painful, yet necessary transformations. In addition, they highlight the need to implement existing recommendations of the State Audit Office, which are likely to boost both effectiveness and efficiency of the public sector organisations.
To watch the full show, please go here.