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Monday 19.02.2018 | Name days: Zane, Zuzanna
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Economy Minister: salaries of top-managers were increased incorrectly

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Daniels Pavluts

“The level of salaries of top-managers in the largest state enterprises was not competitive, when compared with the private sector. However, the way the shareholders increased it is incorrect and discredits the state enterprise management improvement reform,” – believes Economy Minister Daniels Pavluts.

“I previously told the Economy Ministry’s state secretary, who is also a shareholder at Latvenergo, that any decisions related to the salaries of the management of the enterprise need to be based on the practice of good management, complying with all defined principles of the Public Persons Enterprises and Stock Management draft law. It was necessary to first perform an audit of the enterprise, an assessment of the salary level on the market and set clear goals for the next period,” – notes the minister.

“Unfortunately, the state secretary made the decision during my absence, without first informing me neither about the completion nor the planned salary increase amount. I cannot accept such a solution to this situation. The way the top-management’s salaries were increased is incorrect and discredits both Latvenergo‘s achievements in improving management, and the principles stated in the state capital shares reform. This is why the decision of the shareholders meeting needs to be reviewed. A solution needs to be found that would comply with the core principle of the reform,” – says the minister.

Immediately after returning from his leave, Pavluts asked for Juris Puce’s explanations in relation to the decisions made during the shareholders meeting. In order to understand the situation, the Economy Minister met with Latvenergo Chairman Aris Zhigurs on Thursday, January 10. The minister called the management of the enterprise to develop a reasonable solution, linking the salary level with the company’s work indexes, salary level on the market and work results of officials.

Zhigurs informed the minister about the necessity of introducing a new functional management model in Latvenergo‘s work strategy.

At the same time, the minister hopes that this situation will activate not only discussions, but also the interest of other sides in starting a business in Latvia. It was expected that the new law in regard to state enterprise management would become in force on January 1, 2013, but because of the partners’ indecisiveness and lack of interest, the progress of this law has been delayed for at least six months, notes the ministry.

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