Latviski English По-русски
Saturday 18.01.2020 | Name days: Antis, Antons

Train has left the station. Latvian Railway loses board chairman and board member

(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RU

LDz board chairman Edvīns Bērziņš (L) and LDz board member Aivars Strakšas

The council of Latvian Railway (LDz) has agreed to terminate work relations with the company’s board chairman Edvīns Bērziņš and board member Aivars Strakšas, as journalists were told by LDz Council chairman Jānis Lange.

The two aforementioned officials decided to leave their posts of their own accord. Officially they will cease being members of the board with 12 August. Ēriks Šmuksts and Ainis Stūrmanis will continue working in the company’s board.

«Considering that a situation has formed when there is no active dialogue between the heads of the company, the ministry  and the company’s board, the decision has been made to put an end to this uncertainty and start moving forward,» Lange said after a meeting of LDz council.

He added that freight turnover has gone down in the past several months, and that a longer period of uncertainty would only affect indexes further.

Lange said the council’s goal is representing the interests of the shareholder, which in this case is the Latvian state.

«And it is in the interests of the state to secure stable and development-aimed function of LDz. If this uncertainty is allowed to continue for a long time, it could negatively affect the company’s development and cause considerable damage for LDz and the entire industry. Today’s decisions made by the council in regards to the agreement and approval of temporary board members is intended to prevent these negative consequences,» explained Lange.

When asked if Bērziņš and Strakšas were asked to leave, Lange replied evasively, saying that such an agreement was reached after a long period of negotiations.

When asked what will happen with Stūrmanis, who has also received no-confidence from Transport Minister Tālis Linkaits, Lange said right now it is important to ensure continuity of the company’s business activities. This is why an agreement has been reached in regards to the two remaining board members, specifically that they will remain in their posts.

When asked if the company’s council agrees with or denies Linkaits’ criticisms and violations the board members, according to the minister, had committed, Lange said: «We do not have any accurate information, but I can confirm that the audit will continue.»

Lange said two audits are underway at the moment. «The media audit could be ready in the next couple of weeks, whereas the function audit – within the next four months,» said the council chairman.

Lange thanked the company’s management for their work. «Last year’s results were very good. The set financial objectives were met and exceeded. The company’s council, shareholder and Cross-Sectoral Coordination Centre all welcomed this,» said Lange.

He added that the council’s main task for LDz board is stabilizing freight turnover and working on reassessing the company’s business model. Lange stressed that the decline of freight turnover has been significant in recent months, and that it is necessary to look for ways to stabilize the situation.

He also said that LDz council intends to organize a personnel selection process to pick new board members. It is planned to hire a professional personnel selection company for this.

«We are patriots of LDz and the entire industry. We put the interests of the state, Latvian railroad workers and LDz above our professional ambitions. This decision was made to find an exit from the crisis that started in May as soon as possible. We do want LDz to maintain its financial stability and contribute the same or even more to Latvia’s national economy as we have been since 2016,» said Bērziņš.

The LDz council has also appointed two temporary board members – Māris Kleinbergs and Andris Lubāns. LDz reports that until now Kleinbergs has been board chairman and CEO of SIA Schenker. In the past he was board chairman of Latvian Post, as well as the director in transport and logistics company Baltic Logistic Solutions, logistics director in Avers Centre, and chief of Latvian Branch of transport and logistics firm Kuehne&Nagel Latvija.

Until now, Lubāns has served as board chairman and secretary general at Latvian international road carriers Latvijas Auto, has been in charge of Riga City Council’s Transport Department directors office. Between 2014 and 2017 he was board chairman in Pasažieru vilciens, and between 2012 and 2014 he was in charge of Transport Ministry’s Road Traffic Department.

LDz press-service has told mass media that since 2016, when the company’s board was first assembled in its current form, the company’s economic indexes have improved considerably. 2018 was the year when the company reached its best result of the past three things. Evaluation and change of the company’s business and organizational processes, together with increase productivity of its employees and improved cooperation with existing and new partners, the company’s board has helped improve the company’s economic indexes, as mentioned in the company’s statement.

LDz reports that the net turnover reached EUR 365 million in 2018, which is 14.5% more than when compared to 2017. LDz profit reached EUR 14.4 million in 2018. This allowed the company to pay EUR 102 million in taxes and duties, which is 7% higher than a year prior. The company’s productivity reached 51 126 euros per employee in 2018, which is approximately 19% more when compared to 2017.

In the first half-year of 2019, LDz concern’s non-consolidated profit reached EUR 8.9 million, which is 1.9 times more than the budget’s planned profit margin.

As previously reported, on 7 May Linkaits voiced no-confidence to Bērziņš, Strakšas and Stūrmanis. He asked the LDz council to dismiss the three officials. Stūrmanis remains in his post.

The minister stressed that the main points of criticism are associated with possible distortion of competition, which threatens with serious consequences for LDz and the country.

The ministry received information about possible corruption. This information was later forwarded to Corruption Prevention and Combating Bureau (KNAB). Multiple financially large economic transactions, including marketing and advertisement contracts worth several million euros were found, which leads to believe the board has not acted as a serious and careful manager.

LDz board members announced that Linkaits’ statements about the company’s management were aimed at preparing the company for privatization. Bērziņš and Strakšas also asked State Police to commence a criminal process against Linkaits for defamation.

«By spreading baseless and declarative statements lacking any base and providing intentional and insulting statements, Linkaits undermines the reputation of LDz management and the entire company. He also creates suspicion in the minds of residents that myself, my colleague Aivars Strakšas and other officials mentioned by Linkaits have committed serious crimes,» explained Bērziņš.

He said he asked KNAB to provide information about any reported facts. He has also met with the institution’s leadership. «I have received strong information that KNAB has nothing to suggest I or Strakšas are involved in any corruption,» stressed Bērziņš.

LDz is a public use railway infrastructure maintenance company and the leading company of Latvian Railway concern. The company has six subsidiaries – LatRailNet, LDz Cargo, LDz Infrastructure, LDz Rolling Stock Service, LDz Security and LDz Logistics.

Leave a reply

FKTK lists exceptions in which banks are allowed to service Aivars Lembergs

Latvian Finance and Capital Market Commission has listed cases in which Latvia’s finance market participants will be allowed to service Aivars Lembergs, who is subjected to US OFAC sanctions and accused of serious crimes, and three organizations associated with him – Ventspils Development Agency, Business Development Association and Latvian Transit Business Association.

Appropriate jobs promised for laid-off LDz workers

Latvian State Employment Agency promises to find appropriate jobs for laid-off Latvian Railway workers. If need be, those people will be provided the opportunity for re-qualification, raise their qualification or train for a new profession, as confirmed by the agency’s representative Signe Bierande.

Bordāns selects potential candidates to lead the Supreme Court and Prosecutor General’s office

I can see people who could take the reins over the Office of the Prosecutor General and the Supreme Court and change their work standards, Latvian Justice Minister Jānis Bordāns told TV3 programme 900 seconds when asked about any potential candidates to lead those institutions.

Ukrainian Prime Minister ready quit after leaked voice recording

Ukrainian head of government Oleksiy Honcharuk has offered to resign following the circulation of an audio recording, where criticism of Ukrainian President Volodymyr Zelenskiy and his knowledge in economy is voiced.

Inflation in Latvia reportedly higher than Europe’s and Eurozone’s in December

In December 2019 inflation in Latvia was higher than the average in the European Union and Eurozone, according to information published by Eurostat on Friday, 17 January.

Estonian population growth continues in 2019 due to immigration

Estonia has registered in 2019 population growth for the fifth consecutive year and it can be explained with immigration not with natural growth, according to preliminary data released by Statistics Estonia.

BNN investigation | Raunas street property: quiet assistant with a «secret wallet» for Lembergs

There are suspicions that Aivars Lembergs, subjected to international sanctions, has sold real estate located on Raunas Street 27 in Riga to his sister «on paper only». This may have been done to avoid confiscation of properties in the event of a guilty verdict or a possible arrest over the real estate property. However, it is possible Lembergs maintains full control over this real estate property and, most likely, the property is used to fatten his wallet on a regular basis.

Audit: majority of Latvian housing stock has degraded to a state of a slum

Since the denationalization effective access to housing security in Latvia does not exist and most of the housing stock has degraded up to a state of a slum, as concluded by the Latvian State Audit.

Prime minister affirms possibility of carrying oil supplies for Belarus through Latvia

During his meeting with Belarusian President Aleksandr Lukashenko on Thursday, 16 January, Latvian Prime Minister Krišjānis Kariņš affirmed that oil supplies for Belarus may be possible using Latvia’s ports.

Rain in Australia provides relief to continuing fight against bushfires

In eastern Australia, which has been suffering in prolonged and disastrous bushfires, heavy rain has been falling for the past 24 hours.

Weather to remain warm in Latvia at week’s end

At the end of the week the sky in Latvia will become clear and the sun will shine. No precipitation is expected. However, a low atmospheric pressure area will approach the country from the west during weekends, as reported by Latvian Environment, Geology and Meteorology Centre.

GKR helps overthrow Riga’s vice-mayors and put an end to ruling coalition

Riga City Council vice-chairperson Anna Vladova and deputy Druvis Kleins lost their respective posts at an extraordinary meeting on Thursday, 16 January. This happened because multiple deputies from Honour to Serve Riga voted together with the opposition in favour of dismissing them.

Latvian Railway plans to lay off 1 500 employees

Latvian Railway plans to terminate labour relations with approximately 1 500 employees before the end of 2020, as reported by the company’s representative Ella Pētermane.

Russian State Duma approves Putin’s new Prime Minister

The Russian State Duma has approved on Thursday, January 16, the candidacy of the country’s next Prime Minister appointed by Russian President Vladimir Putin.

Ventspils opposition invites Pūce to act to prevent US sanctions from spreading to city council

Environment Protection and Regional Development Ministry and especially Juris Pūce have to act to resolve the current state of Ventsils City Council. It should be dismissed, as the municipal government does not have moral, ethical or legal foundation to continue managing and implementing the criminal management’s policy, according to Ventspils City Council opposition deputies.

Trade unions urge Latvian government to resolve transit businesses’ blocked bank accounts problem

Multiple trade unions associated with the transit industry have turned to Latvia’s highest ranking officials with a request to resolve the situation with bank accounts of multiple transit companies having been blocked because of US sanctions against Aivars Lembergs. If the government does not act, trade unions promise to organize massive protests.

Anris Leimanis picked as RB Rail council chairman

Anris Leimanis, independent council member from Latvian shareholder, has been picked as Rail Baltica joint Baltic company AS RB Rail council chairman. Ahti Kuningas and Karolis Sankovskis will serve as vice-chairmen, as confirmed by the company.

CSP: number of residents at risk of poverty declines in Latvia

In 2018 a total of 434 thousand persons or 22.9 % of the population of Latvia were at risk of poverty – 0.4 percentage points less than in 2017.

Latvian Saeima to ask Denmark to not extradite Kristīne Misāne to South African Republic

On Thursday, 16 January, Latvian Saeima made the decision to protect the rights of Latvian citizen Kristīnes Misāne, asking the Danish parliament and Danish law enforcers to support their Latvian colleagues and find a solution to avoid extraditing her to the South African Republic, as reported by Saeima’s press-service.

Smiltēns: Riga City Council’s situation can be described – divide, redistribute and plunder

«The situation in at Riga City Council can be described with three words – divide, redistribute, plunder,» said leader of Latvian Association of Regions Edvards Smiltēns in an interview to LTV programme Rīta panorama on Thursday, 16 January.

One single vote left the Lithuanian election system intact

The understanding that Lithuania’s election system needs changes is nearly overwhelming, but the ruling Farmers and Greens’ attempt to lower the Parliament election threshold in parties’ multi-member constituency from current 5 per cent to 3 per cent suffered a setback this week.

Estonian power grid executive detained over bribery suspicion

The Estonian Internal Security Service has detained a board member of the Elektrilevi power grid operator over suspicion of taking a bribe.

Demographer: Latvia has the lowest birth rate level observed the past decade

Birth rates continued to decline in Latvia in 2019. The lowest level of the past decade was reached in the country last year, says demographer Ilmārs Mežs.

Healthcare Ministry proposes single social fees rate for specialized tax regimes

One percentage point social fee rate for healthcare will be applied not only to general tax regime participants but also those working in special tax regime, such as microenterprises, patent payers and royalty recipients, according to a proposal for Latvian Healthcare Ministry.

U.S. and China reach preliminary trade agreement

Easing the U.S.-China trade conflict the governments of the two countries have agreed on the first step of mutual trade reconciliation. Their disagreements have affected the world economy for the past few years.

Do NOT follow this link or you will be banned from the site!