The Latvian government has prioritized cost reduction and budget contributions from state-owned companies, leading to layoffs at Latvijas valsts meži (LVM) while former board members are appointed to new managerial positions without public competition.
The Latvian government has increasingly emphasized the need for state-owned enterprises, including Latvijas valsts meži (LVM), to reduce costs and enhance their contributions to the national budget. This has resulted in significant layoffs at LVM, with dozens of employees losing their jobs. Meanwhile, the company has appointed three new directors, all former board and council members, to managerial positions without open competition, raising concerns about transparency and fairness in the hiring process.
Currently employing nearly 1,500 workers, LVM is known for offering high salaries, particularly at the management level, and generates substantial profits, amounting to several hundred million euros annually. A significant portion of these profits is directed to the state budget, demonstrating the company's critical role in the Latvian economy. Earlier regulations mandated that large state-owned companies contribute two-thirds of their profits to the national budget, with LVM contributing €111 million last year alone.
The Director of the Ministry of Agriculture's Forest Department, Āris Jansons, praised LVM's operational performance, describing it as "excellent" in terms of economic return and profit indicators over the past year. This success underscores the government's reliance on LVM for budgetary funding, even as internal management practices come under scrutiny due to questionable hiring practices of former officials without competitive processes.
