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Monday 30.03.2020 | Name days: Nanija, Ilgmārs, Igmārs
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Latvian Railways reportedly wastes money with self-promotion in sports; UGF might be involved

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RULast year and at the beginning of this year, Latvian Railways (LDz) spent at least two million euros on self-promotion. A considerable portion of this money was provided to sports organizations, of which multiple have ties with the Union of Greens and Farmers (UGF), as reported by public broadcaster Latvian Television (LTV) programme De Facto.

The programme reports that at least one million euros of the more than two million euros that was allocated for self-promotion went to sports organizations. Contracts are not publicly accessible, and the ties between sports organizations and LDz is only noticeable through the company’s logos on sports t-shirts, posters, cars and motorcycles.

«It was very hard for us to acquire any kind of information from LDz. Basically every letter references some commercial secret – that any actions with funding are a commercial secret. I believe information as to how capital associations use their funding to support their or non-government organizations should be freely accessible,» says Transport Minister Tālis Linkaits.

De Facto is aware that this year, a day prior to replacement of political power over Latvia’s transport sector a promotion contract worth EUR 55 000 was signed with Dobele motorsports club MX4 Dobele. This club has ties to ex-transport minister Uldis Augulis’ son. A week later a new contract was signed with another one of Augulis’ home city Dobele motorsports associations Tautas sporta bāze worth EUR 60,000,

The programme estimates that since last year both associations in Dobele had received a total of EUR 210 000 from LDz. Ex-minister Augulis denies exacting influence over decisions made by the capital association regarding promotional contracts. One of his explanations states that there are railway hubs in Dobele, which is why it is important to promote LDz there, he says.

When asked if this was a worthwhile business arrangement for LDz, Augulis said the ministry does not interfere with capital associations’ operations.

However, it is clear the money went not only to Dobele but to Ventspils as well. For example, Olympic Centre in Ventspils had a promotional contract worth EUR 100 000 last year, Ventspils basketball club had a promotional contract worth EUR 100 000 last year and another EUR 100 000 this year. A contract was held by Ventspils football club.

One hundred thousand euros is the maximum amount LDz is allowed to invest in a single project on the international market.

In April 2018, LDz signed a EUR 20 000 worth contract for promotion with Jekabpils car sports association SKN Sports so that it supports race driver Reinis Nitišs. This cooperation continues for five years.

Latvian Green Party member Armands Lībietis is also a member of SKN Sports board. In recent years, he has donated considerable amounts of money to UGF. Last year, a couple of months after signing the contract with LDz, Lībietis donated EUR 10 000. He denied any possible ties between donations and promotional contracts in his conversation with De Facto.

In 2018, LDz signed a contract worth EUR 80 000 with Kristers Serģis’ represented motor club. LDz also spent EUR 50 000 on a promotional contract with Liepaja rally and promotional contracts worth EUR 20 000 were signed with Latvian Automobile Federation and Rencēni car club.

In 2017 Automobile Federation awarded Augulis with an order for contribution to the development of car sports. The ex-minister explained this with the development of Biķernieki race track.

Augulis denies having any ties to LDz promotional strategy or exacting political influence.

However, this contradicts what LDz chairman Edvīns Bērziņš’s statements on the matter.

«All of our budgets are coordinated accordingly with shareholders. In this case, all the amounts that exceed permitted borders are sent to the ministry for approval,» Bērziņš told De Facto.

In the past two years LDz has had large promotional contracts with Latvia’s Basketball Association and Latvia’s Tennis Association – EUR 200 000 and more than EUR 130 000, respectively. Management of both associations includes influential politicians and businessmen.

An audit on LDz promotional expenditures has commenced. Linkaits has promised to make results of the audit publicly accessible.

«Our conclusion is that there has to be a clear and transparent system in the country for the state and state capital associations to support sports, because it is clear there is no way for sports to exist without support,» said Linkaits.

It is planned to discuss creation of new principles with Saeima’s committees, Education and Science Ministry, which is responsible for sports policy in Latvia. However, minister Ilga Šuplinska told De Facto that this is not currently a priority.


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