Valdis Zatlers

Valdis Zatlers

Annual Report 2009

Political stability

The President’s attempts to stabilise the domestic political situation and prevent social unrest after the events of January 13

At the beginning of 2009, public dissatisfaction with the political and social situation in Latvia reached its culmination at a January 13 protest which turned into a street riot. The next day, President Zatlers announced that Parliament and the government must take certain steps so as to ensure that political processes are based on parliamentary and government debate, as opposed to settling them in the streets and squares of the country’s cities. The President also wished to show to the people of Latvia that the government could evaluate the situation and act appropriately.



As a representative of the interests of the Latvian people, the President pointed to a need to bring to an end six months of parliamentary debate about amending the Constitution so as to give the people of Latvia the right to propose the dissolution of the Saeima (Parliament), as politicians had promised to do. The President also insisted on amendments to the law on parliamentary elections to get rid of the so-called “locomotive principle” in which candidates stand for election in more than one election district. Here the President’s aim was to improve the country’s election system. He also called for an economic stabilisation plan and the establishment of a supervisory council to oversee the use of money borrowed by the state so that the process might be open transparent and subject to parliamentary controls. In terms of the Cabinet of Ministers, the President called for a plan for reorganising the system of national governance, as well as an appropriate economic stabilisation plan. President Zatlers also called on politicians finally to appoint a director for the Corruption Prevention and Combating Bureau (KNAB) – which had been operating for several months without a Saeima-approved director. The President instructed politicians to complete these assignments by March 31, arguing that otherwise Parliament and the Cabinet of Ministers would prove their inability to act and to take decisions important for the country’s development. In that case, said the President, he would make use of his constitutional right to propose a national referendum on the dissolution of the Saeima.



On March 31, President Zatlers assessed what had been done in response to his instructions. He insisted that “the dissolution of the Saeima is not my goal in and of itself. My goal is to achieve positive and high-quality changes in this country’s political environment.” The President added that he would not be proposing a national referendum on the dissolution of the Saeima because over the course of the two-and-a-half months since the January 13 protests, the political situation in Latvia had changed, and politicians had demonstrated visible progress in pursuit of the instructions which the President had issued.


The establishment of a new government


Political splits in the governing coalition and differences of opinion about the scope and pace of structural reforms in the national system of governance led the Cabinet of Ministers of Prime Minister Ivars Godmanis to resign on February 20, 2009.



President Zatlers had to nominate a new head of government as part of his constitutional authority. After a week of intensive political consultations and evaluation of the possible candidates for prime minister, the President nominated Valdis Dombrovskis of the New Era (JL) party, arguing that he would be supported by a broad range of parties in the Saeima and that Dombrovskis had the economic and financial competence that would be needed to deal with the ongoing economic crisis. Dombrovskis also had experience in European institutions. The Cabinet of Ministers which Dombrovskis put together won a vote of confidence in the Saeima and went to work.



On March 12, President Zatlers addressed the new Cabinet of Ministers, insisting that it would not be given the traditional 100-day honeymoon. He set out three main tasks for the new government – economic stabilisation, ensuring the state’s basic functions which making the system of national governance more effective, and ensuring social security.


Convening Cabinet meetings


Over the course of 2009, President Zatlers convened two special meetings of the Cabinet of Ministers after monitoring domestic politics and seeking to promote the taking of decisions on important socioeconomic matters. One was on April 24, and the other was on September 15. In both cases, the President set the agenda for the meetings. The spring meeting was aimed at ensuring a much quicker process of implementing structural reforms in terms of the system of national governance health care and education. That happened. The meeting launched the long-awaited and necessary implementation of structural reforms, particularly in relation to education and health care.



In the autumn, President Zatlers met with people in various parts of Latvia and found that people just didn’t understand many major issues and the work done by the government in resolving those issues because there was insufficient explanation of these things. He found that people were waiting for specific answers. At the September 15 Cabinet of Ministers meeting, the President’s aim was to ensure the circulation of information about what the government had done and would be doing in dealing with issues that are of great importance for every person in Latvia.


The result of the meeting was a set of specific tasks and deadlines. Sadly, many of these tasks were not completed on time, but there have been some visible achievements. For instance, there is a plan on how the number of employees in government institutions will be reduced by 2013 to the point where public sector employees represent no more than 8% of the total population. A new draft law on insolvency has been drafted, as has a unified wage system. Additional money has been found to co-finance European Union projects, a plan for healing the Latvian economy has been reviewed, and support has been given to several steps related to tax administration so as to promote entrepreneurship. The priority for the government was identified as employment in the country.



Also during the meeting, as participants discussed the pace of structural reforms in the country, the issue of the country’s medical system was brought up. Specifically, the discussion was about mandatory health care insurance. The health minister was instructed to set up a working group on the matter and to submit its conclusions to the Minister of Cabinets by March 31, 2010.


The involvement of social and other partners in budget considerations


President Zatlers became involved in the process of amending the 2009 national budget so as to ensure a balanced process of decision making and the involvement of social partners in the process. First he insisted that social partners such as the Latvian Confederation of Employers, the Latvian Association of Labour Unions, the Latvian Association of Local Governments, the Latvian Chamber of Commerce and Industry, and the Latvian Association of Pensioners be brought into the mix. On March 12, speaking to representatives of the newly established government, President Zatlers had this to say: “A positive thing is that our social partners – organisations of businesspeople and public activists – have become very much more active in recent times. They’re presenting their proposals and views. It is of key importance to maintain a dialogue with and co-operation with our partners so that we don’t make mistakes.” On more than one occasion, the President met with the social partners, members of the governing coalition and members of the Cabinet of Ministers at the Rīga Castle to emphasise the importance of social dialogue in the taking of important decisions, including the issue of the national budget.



On June 11, President Zatlers visited the Cabinet of Ministers to promote compromises in relation to draft amendments to the 2009 national budget. He became a mediator among the coalition parties, social partners and Cabinet members, correlating all of the proposals that had been made in relation to the issue. Late in the evening on June 11, the parties to the negotiations signed a political agreement on the most important content-based aspects of the 2009 national budget amendments.


After the approval of the budget amendments, President Zatlers called on members of the governing coalition to work actively on the 2010 national budget, adding that it should be based on qualitative reforms, not just a linear cut in budget expenditures.