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Monday 16.07.2018 | Name days: Hermīne, Estere

Pūce: RS is fortunate that «good uncle» Ušakovs gives as much money as needed

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU«Rīgas satiksme is a jar with an empty bottom in which Riga’s taxpayer money is put in from one end and the money put in it falls out of the other end and is used in different fraud schemes like nano-water, and the useless hydrogen-powered transport project – enormous and financially unreasonable projects. This company does not have properly managed financial activities. It is unacceptable to have a situation in which company revenue declines but expenditures continue to increase – this is a sure way for the company to go bankrupt. Rīgas satiksme is fortunate that ‘good uncle’ Nils Ušakovs is always generous and gives them as much money paid by Riga’s taxpayers as they want,» said Riga City Council opposition deputy and chairman of Latvian Regional Alliance/For Latvia’s Development Juris Pūce in an interview to BNN.

«Riga City Council is too deep in uncertainties»

The deputy notes that distribution of finances regularly takes place at Riga City Council. What I mean is Riga City Council sometimes changes the budget three times a year, which, according to him, is a very odd management method. «Often changes in decision do not contribute to planned development. Riga City Council is too deep in uncertainties.»

The deputy also notes that Rīgas satiksme’s yet another request for additional finances only increases suspicions.

BNN had previously reported that, considering Riga City Council’s Finance and Administration Affairs Committee’s reviewed matter regarding the proposition to amend Riga municipality’s 2017 budget in order to increase Rīgas satiksme’s capital by EUR 9.6 million, Pūce turned to Riga Mayor Nils Ušakovs, asking him to provide all information about this matter and explain the reasoning behind this decision.

Pūce emphasizes that no explanation was provided in the end.

Rīgas satiksme is in a very bad financial state

The deputy points that Riga City Council decided to provide EUR 4.3 million to Rīgas satiksme in September for Skanstes tramway project. Opposition deputies requested additional information about Rīgas satiksmes’s financial state to be provided first.

«What we found out is frightening. Basically the management of Rīgas satiksme confirmed that the company is in a very bad financial state. Minutes of the board’s meeting added to a report show – RS has a very low capital index. Company representatives admit that they have difficulties with company solvency. They desperately need municipality’s money to cover costs for the trolleybuses they bought. Rīgas satiksme does not have its own revenue to cover costs on its own.»

Pūce admits that he has suspicions about Rīgas satiksme’s management and its capital holder – the Mayor of Riga. «They don’t care what happens in the company. If we look at balance data for the past year and compare that to this year’s results, we will see that nearly all profit indexes have declined, whereas all costs have increased.»

He adds that Rīgas satiksme never provides any information voluntarily – only when the company is ordered to do that. «Clearly Ušakovs has created a mechanism that hides information very well. This creates suspicions that the mayor has personal interests in making sure the company remains buried and unreachable for others.»

Riga City Council deputy says the company concluded last year with losses that had to be covered using taxpayer money. «And if we look at how this situation could develop in the future, just how big their debt is, I would say next year Riga City Council would have to invest EUR 35 million on top of the already invested EUR 96 million.»

Rīgas satiksme’s losses constantly plugged using taxpayer money

This situation has created concerns – either Riga City Council makes its budget to meet Rīgas satiksme’s needs, or the company goes bankrupt. ‘Both scenarios are undesirable,’ says the deputy.

Pūce says that the State Audit has plans for an audit at Rīgas satiksmē and Riga City Council in the future.

«It is our job as the opposition to follow such potential risks. We ask questions, request information and acquire it through other means in situations when we are denied access to it. We try to sort out this field with help from supervisory institutions,» says Pūce.

«And gradually we are getting somewhere. Still, progress is slow, because the experience we’ve had working with Riga City Council is very negative. They do not have an economic, fair and working mechanism in place. The mechanism they do have obeys political orders no matter what they are. Unfortunately, the people giving orders act very irresponsibly towards Riga.»

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