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Ceturtdiena 18.07.2019 | Name days: Rozālija, Roze
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Promises can’t buy dinner – next year’s budget plan omits promised wage increase for doctors

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUThe biggest challenge before newly-elected political parties in Latvia will be the 2019 budget. There will not be any free money to allocate for the implementation of pre-election promises. To increase pensions or provide healthcare to residents who don’t pay taxes, it will be necessary to either cut money from industries or increase taxes.

Most likely political parties will not be able to fulfil their promises earlier than 2020. The next budget is so weak that promises of the old coalition will also remain unrealized. Doctors will be the first to suffer: they were promised a 20% increase of wages – something that will remain an empty promise, it seems, as reported by Nekā personīga.

«This week the government said goodbye to its social partners. Ministers, employers and people from trade unions took a photo together and thanked each other for constructive cooperation. During the meeting of the National Council for Trilateral Cooperation, Finance Ministry presented the 2019 budget plan, which has already been sent to European Commission for approval. The plan details everything well enough – growing economy, reduced unemployment and budget deficit within acceptable deviations. The festive mood of this event was ruined by Valdis Keris – head of Latvian Health and Social Care Workers’ Union – because no increase of wages for workers of this sector is mentioned in the budget plan,» the programme reports.

Keris said during the meeting: «Thank you for the presentation. Unfortunately, I must conclude that the ministry’s presentation is like a spoon of tar in an otherwise sweet barrel of honey provided by the prime minister on the one thousand days of the government. This is because unfortunately the budget plan does not include any increase of wages for medical personnel or increased funding for overtime.»

The prime minister and finance minister then proceeded to explain that the wage increase was not approved by the Cabinet of Ministers. That was a promise made by Healthcare Minister Anda Čakša, the programme explains.

Keris: «Now we are told it is too late – the government failed to include this matter in the budget plan in time. This is, honestly, very upsetting».

«Wages were increased by 30% this year. Keris’ trade union and the healthcare minister had agreed before elections that there would be a 20% increase in the next three years. This would require EUR 70 million in 2019. Now the minister invites doctors to turn to newly-elected political parties for assistance,» NP reports.

Healthcare Minister Andas Čakša: «I’ve heard promises like doubling wages of nurses, adding much larger bonuses to wages paid to doctors. With that, I have reason to believe the new government will carry these promises and continue work on increasing wages and reducing prices of medicines.»

«Formation of the new government is progressing slowly. Parties continue meeting and organizing talks regarding healthcare matters and regional reform. However, the process stagnates. New Conservative Party does not want to participate in meetings with Union of Greens and Farmers, KPV LV refuses to meet with deputies, and only Attīstībai/Par! does what it can to work with everyone,» the programme adds.

NP believes it unlikely for the next Saeima to approve the next government in the next couple of weeks. «This reduces hope for the budget to be ready this year. The new government will have to choose between interfering with the budget or continuing the course set by Kučinskis government.»

It is reported that three parties that have taken the initiative in forming the new government promised enough for costs to reach EUR 100 million. If parties decide to realize changes, the budget’s approval process will become more complicated, the programme adds.

Jānis Bordāns: «We will offer our ‘500 plan’. It will include pensions, minimal wages and measures for their increase. We will look at this year’s budget and ways to adapt it to implement our changes.»

Daniels Pavļuts: «There are things that are untouchable and other things would like to critically assess. Both in the context of increased costs and in regards to the way for us to look for ways to implement promises made during the pre-election period. We will look at different possibilities.»

Artuss Kaimiņš: «On behalf of KPV LV I can promise that will have no plans to add any cardinal changes. We may consider some cosmetic changes here and there, but no major changes to the 2019 budget are planned.»

Finance Ministry’s prepared to not approve the budget before the end of the year. In this case, it will be allowed to spend no more than one-twelfth of this year’s expenditures every month. The state budget is not expected to have many problems, whereas municipalities might suffer from the tax reform. The government has promised to compensate losses for PIT reduction. If there is no budget, there will be no compensation, NP adds.

Municipal Finance Monitoring and Finance Department’s director Inta Komisare says: «This influence was lower in 2018. This year, special grant will be around EUR 21 million, whereas next year’s will be around EUR 100 million. With that, if we only include this EUR 21 million amount based on this year’s funding principles, we will see that municipalities will likely experience a decrease in the period when the temporary budget is planned to stay in force.»

The programme reports that even with the most optimistic estimates the country will have to exist without a viable budget until February 2019 if parties sink deep in budget discussions.

Finance Minister Dana Reizniece-Ozola said a week ago that «ministries found a loose amount of EUR 50 million in budgets. This will be road bread for the new government. But this money will likely go to previously announced objectives. For example, paying doctors for overtime will cost EUR 13 million. Increased wages for judges and prosecutors will cost the state budget nearly EUR 9 million. Continuation of the fence on the country’s eastern border will cost an additional EUR 7 million,» said the minister.


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