Latvia

JANIS IKSTENSUniversity of Latvia

Cabinet report

The coalition supporting the Dombrovskis III cabinet was swiftly branded the ‘coalition ofreforms and rule of law’ to reflect some of the reasons behind President Zatlers’ dramaticmove to call for early elections in 2011 (Ikstens 2012).

Those who sought stronger observation of the rule of law took some hope from whatappeared to be a notable political weakening of Latvia’s so-called ‘oligarchs’: the electoralfiasco of Šlesers Reform Party (ŠRP) and the exclusion from government (for the first timein a decade) of the Union of Greens and Farmers (ZZS), tainted by its association with theinfluential Mayor of Ventspils Aivars Lembergs. The newly created Zatlers’ Reform Party(RP) was keen to emphasise the need for broad reforms in many policy areas and it placeda few ambitious people at the helm of several ministries. Moreover, the party known asUnity (V) pledged to pursue a policy of growth instead of the previous years’ policy ofeconomic crisis management. In spite of this, the pace of reforms hardly accelerated and insome areas even more problems emerged.

Roberts Kılis, a liberal-minded college professor and close associate of Valdis Zatlers,was put in charge of the Ministry of Education and Science, which was seen as stagnant

Table 1. Cabinet composition of Dombrovskis III

For the composition of Dombrovskis III on 1 January 2012, see Ikstens (2012: 175–186).

Changes during 2012:Minister of Justice/Tieslietu ministrs: Gaidis Berzinš (1970 male, NA) resigned on June 20 and was

replaced by Janis Bordans (1967 male, NA) on July 5

Table 2. Referendum results for 2012

Date of referendum: 18 February 2012Electorate: 1,545,004Referendum question: Do you support the adoption of the Draft Law Amendments to the

Constitution of the Republic of Latvia that provides for the Russianlanguage the status of the second official language?

Electorate: 1,098,921 (71.1%)Total votes cast: 1,098,593 (71.1%)Total valid votes: 1,095,069 (99.7%)Votes in favour: 273,347 (25.0%)Votes against: 821,722 (75.00%)

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despite its key role in shaping the country’s long-term development. Kılis’ ambition was toimprove the quality of education by reforming the financing of both secondary and highereducation, and revamping the ministry apparatus. A range of public servants did leave theministry in 2012, but that did little to convince both municipalities and public institutions ofhigher learning to accept the finance reform proposals. Municipalities claimed that theproposed voucher system would only increase the disparities between schools, while theuniversities pointed out that the replacement of state-financed study slots with bank loanswould scare away students and cause them to study in countries where higher education isprovided at public expense.

Edmunds Sprudžs, a young information technology entrepreneur, became Minister forEnvironment and Regional Development with the task, inter alia, of improving publicadministration services and further advancing administrative reform in order to adjust tothe depopulation of Latvia’s territory. Sprudžs was also expected to play a role in removingAivars Lembergs from the position of Mayor of Ventspils. It is the latter task that put aspotlight onto Sprudžs’ questionable business activities after he waged an ill-planned andunsuccessful campaign aimed at stripping Lembergs of his mayoral position. Moreover, theLatvian Association of Large Cities effectively backed Lembergs and even contemplated acall for Sprudžs’ resignation.

The liberal media saw the influence of Aivars Lembergs in the resignation of JusticeMinister Gaidis Berzinš of the National Union (NA), who suddenly left his position citinga disagreement with the prime minister on the issue of Jewish property restitution. Anumber of pundits claimed that Berzinš’ resignation was a warning shot at Unity after amajor contract for railway reconstruction allegedly did not go Lembergs’ way. Subse-quently, however, several leaders of NA and Berzinš himself admitted that the resignationwas related to the miniscule influence and meagre treatment of the alliance within thegoverning coalition. The NA feeling of relative deprivation was further enhanced by anotably higher level of public support for NA compared to that of the RP. While additionalevidence of internal tensions followed, Prime Minister Valdis Dombrovskis paid littleattention to settling the issue and attended to it only insofar as it could affect his top priority– Latvia’s ascendance to the eurozone as early as 2014.

Institutional changes

Reform of party finance has been an ongoing process in Latvia since 2002, leading to evertighter regulation. In 2012 the maximum amount of membership fee and donations perperson per party per annum was reduced to 50 monthly minimum wages (approximately€15,000), but parties were given wider discretion to use public funding. More importantly,however, paid political advertising was prohibited on television for 30 days before theelections. The changes became effective before the 2013 municipal election campaign.

The Saeima amended its rules of procedure to enable the submission of collectivepetitions to the legislature. That effectively gave the right of legislative initiative to thegeneral public in cases where no fewer than 10,000 citizens aged 16 and over expressed theirsupport for a particular cause. Moreover, the Saeima recognised that such support couldbe expressed electronically. These amendments endorsed the methods employed by

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manabalss.lv, a web-based platform for civic activism that sought to broaden politicalparticipation by simplifying and coordinating petitions to the Latvian parliament.

Another change in the parliament’s rules of procedure eliminated the secret ballotin electing a vast majority of officials including judges, the prosecutor general andothers. Only the state president and the state auditor are still chosen by a secretvote.

In reaction to a referendum held in February on introducing Russian as another officiallanguage, the Saeima raised the minimum number of signatures necessary for initiating areferendum from 10,000 to 30,000 – a figure that will increase to 10 per cent of eligiblevoters in 2015. The new law also permits the collection of signatures in an electronic form,but given the trends in signature-gathering campaigns, the post-2015 threshold may effec-tively disable the referendum as a tool of political participation.

In belated compliance with the Lisbon Treaty, in October the Saeima amended the Lawon Referenda to lay out a legal framework for participation in the European Citizens’Initiative.

More than 111,000 residents of Latvia filed their initial declarations of wealth by 1 June.The long-debated move was expected to aid in battling the corruption and shadoweconomy. Residents were also given a chance to declare their taxable income since 1991, forwhich the tax had not been assessed, and to pay a lower tax rate of 15 per cent.

Issues in national politics

A referendum on making Latvia officially bilingual by affording official language status toRussian was held in February. It was asserted that this referendum was provoked by theNational Union when it backed a signature gathering campaign in 2010 to offer publiclyfunded primary and secondary education in Latvian only, which would constitute a majorblow to a large segment of schools where Russian was still the dominant language ofinstruction. That failed effort was said to have mobilised the opposing camp to strike backwith an initiative to amend several articles of Latvia’s constitution in order to grant Russianthe privileges of official language status in Latvia.

However, the signature gathering in favour of official language status was initiated byextremist groups and was on a slow pace until the Harmony Centre threw its supportbehind the campaign. Once Mayor of Rıga Nils Ušakovs made public his choice to supportthe cause, the signature drive necessary to launch the referendum was swiftly accomplishedand resulted in the collection of 187,378 signatures, or more than 12 per cent of eligiblevoters. Some Saeima deputies hinted they might have signed the petition, which promptedNational Union to call on the Central Election Commission (CEC) to disclose the names ofthose deputies who allegedly breached the MP’s oath that, inter alia, obliges each MP to‘strengthen the Latvian language as the only official language in Latvia’.The CEC declinedto disclose the signatories on grounds of privacy protection and only Nikolay Kabanov(Harmony Centre), openly admitted signing. Kabanov’s act was reprimanded by Saeima ina written condemnation.

More profound were discussions of legal experts and politicians about whether theintroduction of a second official language was constitutional and could even be the subject

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of a popular vote. Thirty MPs from the National Union and the Unity requested that theconstitutional court consider the constitutionality of the referendum scheduled for Febru-ary 18 and postpone the vote until the issue was legally resolved. The constitutional courtdeclined this request for postponement as it deemed it ‘impossible to interfere with thelegislative process’, but the court did launch a review of the act on initiating referenda andlaws.

The highly charged atmosphere on both sides resulted in the second highest referendumturnout since the March 1991 poll on Latvia’s independence from the Soviet Union. Thelanguage issue mobilised even those politically apathetic Latvian citizens who had recentlyemigrated to Ireland, the United Kingdom and other EU Member States. Nearly 70.5 percent of eligible voters participated in the referendum, and 74.8 per cent of those partici-pating voted against Russian as the second official language in Latvia. Calls by some fringegroups to vote with a blank or invalid ballot had not resonated well as only 0.2 per cent ofvotes were deemed invalid.

The strong rejection of the idea by voters was interpreted by top political figures invarious ways. State President Andris Berzinš spoke of voters expressing a clear preferencefor the strengthening of Latvian ethnic identity. Saeima Speaker Solvita Aboltina viewedthe result as a vote against a divided society. Raivis Dzintars, one of leaders of the NationalUnion, expressed gratitude to those ethnic non-Latvians who supported a single officiallanguage. Valdis Zatlers, a former president and the leader of the Reform Party, urgedethnic Latvians to adopt a more conciliatory stance towards ethnic minorities and becomemore forthcoming. Nils Ušakovs, a key figure of the Harmony Centre, thanked all votersregardless of their position and expressed hope that the result would not lead to new linesof divide.A sigh of relief could be heard in the diplomatic community as Russian could havebecome another official language in the European Union as a result of the 2012 referen-dum. Although a few political statements after referendum emphasised the need to worktowards further integration of Latvia’s society, these were not followed by substantialactivities.

As the tide of the language referendum began to recede the Bank of Latvia (BoL) waskeen to launch concerted efforts aimed at Latvia’s admission to the eurozone in 2014.Whilethe political elite tended to hold a favourable attitude towards the issue, the general publicwas far more sceptical. According to a poll commissioned by BoL in August, 59 per cent ofrespondents opposed Latvia’s accession to the euro. Publication of those results became alaunch event for a broader publicity campaign in the media aimed at changing the publicmood. BoL employees and officials published no less than one article per week in the mediato demonstrate the advantages of euro membership for Latvia. The Ministry of Financefollowed with a series of seminars and discussions outside the capital city that werereported in the local media and contracted with public relations agencies to carry out arange of other activities.

However, economic problems in southern Europe and suspicions that Latvia would beliable for the southerners’ obligations prompted many Latvians to adopt a cautious atti-tude towards the euro. The arguments offered by proponents of the euro were highlyutilitarian and emphasised easier travelling and elimination of bank charges for currencyexchange. The BoL also published a much-disputed estimation that switching to the eurowould save Latvia and its residents €900 million over a ten-year period. However, the

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BoL was reluctant to discuss why a number of other East European countries hadpostponed their plans to join the euro and how bail-outs would affect Latvia’s contribu-tion to the European Stability Mechanism. The issue of loss of control over currencypolicy rarely appeared, which merely enhanced the one-sided character of the gover-nment’s campaign.

Prime Minister Valdis Dombrovskis remained committed to Latvia’s accession tothe euro in 2014 and endorsed fiscal measures aimed at reducing the inflation rate.In particular, the government lowered the value-added tax (VAT) rate by one percent-age point in July. While this measure benefited persons with higher income andincreased the already high social inequality, any criticism fell on deaf ears in thegovernment.

Tensions within the ruling coalition were seemingly ignored by the prime ministerand contributed to calls by opposition parties and nongovernmental organisations(NGOs) for the resignation of four ministers and attempts to have a confidence voteon individual ministers on three occasions. These quarrels, however, did not ruin theadoption of the National Development Plan, 2014–2020 – a medium-term policy planningdocument. The Supra-Institutional Coordination Centre placed under the direct supervi-sion of the prime minister drafted a document entitled ‘Economic Breakthrough’,which placed the main emphasis on stimulating innovative, knowledge-intensive entre-preneurship. Amid complaints by MPs about the vagueness and lack of focus of thedocument, the Saeima endorsed it by 81 votes in favour, with seven abstentions and noneagainst.

Zatlers’ Reform Party experienced a further decay in 2012 after the party made poorchoices in the aftermath of the 2011 elections (Ikstens 2012). The party membership wasdisappointed with the failure of the party to hold its congress in April due to a lack ofquorum. At a second attempt, when no minimum participation is required by the law, theparty removed the name of its founding father (Zatlers) from the title of the organisation.The name change was intended to refocus the party on a broader, liberal reform agenda, butit also reflected the changing role within the party of Valdis Zatlers, who had become ratherobscure after the 2011 elections, not least because of health problems. Although the partyattempted to regain the public’s trust by an avalanche of ministerial activities in the fall,Reform Party’s support hovered around 2 per cent – well below that of the Unity and theNational Union.

Meanwhile, Harmony Centre was preparing for municipal elections scheduled forJune 2013. While it occasionally lent support in parliament to the Unity, which struggledto keep the governing coalition afloat, Harmony Centre publicly positioned itself in clearopposition to the austerity measures of the Dombrovskis cabinet. Moreover, the partymade use of the financial resources of the capital city to introduce a range of socialbenefits for pupils and retired persons. The measures resonated well not only with resi-dents of Rıga but also with others throughout the country, as Rıga became a role modelin social protection. Along with the massive presence of the mayor of Rıga in the media,these measures overshadowed press reports not only about Rıga’s rapidly growingbudget deficit, but also about corruption scandals in the city council and the close ties ofMayor Nils Ušakovs to the Russian Embassy and his direct orchestration of Russian-language media in Latvia.

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Sources and further information

Publications:

Ikstens, J. (2012). Latvia. European Journal of Political Research Political Data Yearbook 51(1): 175–186.

On the Internet:

The Saeima: www.saeima.lvCabinet of Ministers: www.mk.gov.lvThe President’s Office: www.president.lvCentral Election Commission: www.cvk.lv

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