After failing to accomplish the previously suggested centralization of state owned companies, the decision has been made to liquidate the Cross-Sectoral Coordination Centre (PKC). It will be merged with Latvian State Chancellery – the institution from which it was separated ten years ago.
PKC was originally intended to become a super ministry – an institution subordinated to the prime minister that stands above the interests of separate ministries and look towards the country’s development as a whole.
Heritage for the next government
LTV programme De Facto reports Latvian Prime Minister Krišjānis Kariņš has picked this path, believing that it is necessary to enhance the functions of PKC and linking it closer to the State Chancellery – becoming part of it. This would help enhance the functions of the State Chancellery as well. If all documents and ideas from PKC were proposed by the State Chancellery and its director, they would have different weight, according to the Prime Minister’s Office.
«As for influence, it is worth mentioning that the State Chancellery is the institution that organises the work of the Cabinet of Ministers and meetings of state secretaries. Of course, when the director of the State Chancellery is the one who hosts meetings of state secretaries, his word has weight in decision-making in relation to different cross-sectoral coordination topics, which is something we can see already,» said the head of the Prime Minister’s Office Jānis Patmalnieks.
«Looking at it from our perspective, this position, which has been present in the Cabinet of Ministers for some time, is that there are things that can be done better, and we can see that together, the State Chancellery and PKC can do them better. This the moment at which we have reached this decision so that we can leave it safely for the next cabinet of ministers after Saeima elections.»
Good ideas but not enough influence
The National Development Plan, management of state owned companies and other such topics were generally left in the care of PKC in the past. This institution was entrusted to lead a team of experts that presented the government with advice on managing the covid crisis. All this ended with démarche. Now the centre is to prepare a proposal for the liquidation and its merging with the State Chancellery. The reform proposal was to be prepared this week. PKC would continue existing until the start of next year.
Currently PKC consists of a team of 23 people and the budget for their wages is about EUR 1 million.
Ideas are good but not enough influence – De Facto heard this opinion many times when the topic of PKC’s liquidation and delegating its functions to the State Chancellery was brought up. It was composed as an institution subordinate to the prime minister so that it is possible to manage state development topics using it.
Here is what one of the authors of PKC, 11th Saeima deputy Lolita Čigāne had to say ten years ago (20.11.2011): «Definitely operations of such a centre, if successful, which is something no one can guarantee, would save money to the state chancellery, because it would help ministry and industry people and related institutions and organisations work in a more coordinated matter – in the name of a single goal and state development.»
A solution left to collect dust in drawers
Nine years ago PKC proposed centralising the management of shares of state owned companies. PKC managed to succeed in making state owned companies managed following single guidelines. However, the idea did not reach the part of centralised management – neither then nor in 2020, when this topic returned to the table.
«We have seen this process cannot go quickly. There was an offer about this centralisation, which is something that was turned down by ministries, which is why it was not possible to reach an agreement in this government. And, as I’ve said, we can see this process will be revolutionary gradual. Reviewing, improving many management affairs, preserving their competitiveness, establishing clear goals for state companies and working with them,» says PKC manager Pēteris Vilks.
Currently leading officials of ministries are the holders of capital shares in state companies. The offer developed one and a half years ago provided for shares being handed to a single institution, such as a company created for this specific purpose. Although the commitment to this is listed in the government’s declaration, the centre’s proposed solution was left in the government’s drawers.
Ideas were slowed
Baltic Institute of Corporate Governance Latvian representation office manager Andris Grafs believes PCK lacked leadership in pushing big topics. «The Cross-Sectoral Coordination Centre could have a bigger role if they were more insistent in arguments and opinions as to to the influence on the economy and management quality, which politicians have failed to use or have failed to recognise as important and that the Cross-Sectoral Coordination Centre could serve as the anchor with valid recommendations. This is why there are no tangible results.»
Following sharp objections from the Minister of Justice, the creation of a single institution for support of children’s emotional and psychological health was halted.
PKC received the objective for the formation of such an institution from this very government. The Ministry of Justice noted in objections – the centre is on a subject of the system for the protection of children’s rights.
«We are left with the opinion that the initiative is good and worth developing, that it is necessary to develop the first and biggest three to five services, then test them and adopt in practice. Then it would be possible to decide on an institutional model needed there. […] The Cross-Sectoral Coordination Centre could have done this as well, but this is how it is here – I look at topics as an attorney as well. We cannot simply do whatever just because of our revolutionary conscience. We have to look at what the law says. If we present some state administration institution with some long-term objective, we have to delegate it in line with the law,» said the Ministry of Justice parliamentary secretary Ilona Kronberga.
State Audit recommends enhancing PKC’s role
PKC went rather successfully with writing the National Development Plan. Billions from European funds were divided based on it. The process was supervised by Saeima’s Sustainable Development Committee. A meeting is planned for next week to interview all those involved in the institution’s reorganisation plans.
«It is immensely important to appoint a person in the state administration that would be specifically responsible for the development of the National Development Plan, its implementation, supervision and coordination. And this cannot be a person already responsible for ten to 100 other duties. It cannot be the director of the State Chancellery,» says the head of the committee Vjačeslavs Dombrovskis.
Minister of Environment Protection and Regional Development Artūrs Toms Plešs, whose ministry works with different development plans, comments: «We will look at the development direction the State Chancellery presents to the government – distribution of functions and the functions themselves. Because in any case – cross-sectoral coordination and mutual cooperation will be needed more than ever.»
Just recently the State Audit, after auditing state companies, the Cabinet of Ministers was recommended to enhance the role of PKC in the management of state companies, not liquidate it.
The state auditor noted that PKC is an advisory institution without wide authority.
De Facto: Cross-Sectoral Coordination Centre to be liquidated after decade-long experiment
