The recommendations issued by the State Audit Office (SAO) during audits—many of which remain unimplemented—as well as other audit findings and insights could have a positive impact on the national budget amounting to several million euros, according to the SAO.
Auditors have sent a corresponding summary to the Saeima, the Prime Minister, and the Minister of Finance, including both new recommendations and findings, as well as a review of those submitted last autumn that remain relevant.
“The potential gains from implementing these recommendations could range from tens of thousands to several million euros,” said Auditor General Edgars Korčagins.
The SAO stresses in its report that these
recommendations should not merely be seen as a checklist with deadlines, but rather as actions that promote public well-being.
Each proposed action is aimed at initiating or ensuring specific changes and improvements. The implementation of these recommendations is expected to bring tangible and measurable benefits.
For example, in the audit “On the Accuracy of the 2024 Report Preparation by the Ministry of Climate and Energy”, it was found that by changing the model for financing the mandatory electricity procurement costs, the burden was shifted from end-users to the state budget. The public trader, SIA Enerģijas publiskais tirgotājs (Public Energy Trader), borrows financial resources from its parent company AS Latvenergo to make payments to commercial entities, and the interest costs from these loans are covered by the state budget.
Payments to commercial entities are made monthly, while funding from the state budget is received quarterly.
This prolongs the loan period and results in additional financial costs. In 2024, the state budget had to cover 1.15 million euros in extra interest payments. To reduce state budget expenditures, the Ministry of Climate and Energy has been advised to review the financing model and propose necessary amendments to the relevant regulations.
The SAO also sees opportunities for optimizing administrative functions—for instance, within capital companies fully owned by the Ministry of Culture, and in all four state social care centers under the Ministry of Welfare (“Rīga,” “Latgale,” “Zemgale,” and “Kurzeme”), which perform identical functions.
As previously reported by BNN, the Ministry of Finance (MoF) plans to compile proposals and prepare calculations by the end of June for measures aimed at reducing expenditures by at least 150 million euros annually—or 450 million euros over three years.
On the 20th of June, the MoF announced that the first round of discussions with sectoral ministries had been completed, during which program expenditures were analyzed. The MoF received 200 proposals for reducing budget expenditures and promised to compile and analyze them in detail.
The ministry explained that in order to ensure sustainable financing for national strategic priorities—defense, public security, and demographics—from 2026 onward, a targeted and structured budget review process is being implemented. The aim is to increase the efficiency of public funds while strengthening the country’s long-term resilience.
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