A recent joint announcement highlights a proposed reform in Latvia's public procurement system that could drastically reduce transparency regarding the use of public funds. The reform aims to increase the procurement threshold for state and municipal purchases—potentially allowing purchases to take place without any open tender procedure or public notice. Specifically, the thresholds for goods and services procurement would rise fourteenfold, while for construction works, the rise could be as high as 270 times, resulting in potential spending of up to 555 million euros annually without public notification or opportunities for competitive bidding.

This drastic change raises concerns about competition in the market, as limited access to information is expected to reduce the number of potential bidders. With fewer competing offers, contract prices are likely to increase, as evidenced by estimations from the European Commission which state that every additional bid can lead to an average reduction of 2.5% in contract prices. Thus, the proposed reform not only threatens to cut off competition but also poses challenges to regulatory agencies that rely on accessible data to maintain oversight of public procurement processes and to identify potential risks proactively.

Overall, the implications of such a reform could undermine public trust in how public funds are allocated and managed, as transparency is crucial for ensuring fairness and accountability in public spending. Stakeholders, including business organizations and government institutions, express concern that the lack of stringent procurement processes could pave the way for inefficiencies and misuse of public resources, warranting further debate and scrutiny regarding this proposed reform in Latvia.