Nations in Transit
Population: 2.2 million
GNI/capita, PPP: US$16,320
Source: The data above were provided by The World Bank, World Development Indicators 2012.
*Starting with the 2005 edition, Freedom House introduced separate analysis and ratings for national democratic governance and local democratic governance, to provide readers with more detailed and nuanced analysis of these two important subjects.
NOTE: The ratings reflect the consensus of Freedom House, its academic advisers, and the author(s) of this report. The opinions expressed in this report are those of the author(s). The ratings are based on a scale of 1 to 7, with 1 representing the highest level of democratic progress and 7 the lowest. The Democracy Score is an average of ratings for the categories tracked in a given year.
During the first years of the global economic crisis, Latvia experienced a greater decline in growth than any other country in the European Union. In 2011, Latvia’s economy stabilized and even grew by approximately 5 percent; however, the social cost of this initial recovery has been significant. Austerity measures imposed in 2009–10 involved painful cuts to a wide range of state services and major cutbacks in public sector employment and salaries. The vitality of the private sector also declined, leading to widespread discontent among educated jobseekers and would-be entrepreneurs. Emigration of young people from Latvia, a country of less than 2.1 million people, has increased every year since 2007, and unemployment is still more than twice pre-crisis levels. A 2011 census found that Latvia’s population has decreased 13 percent since the year 2000.
In 2011, continuing economic and social challenges fuelled public distrust and frustration with parliament and the government, particularly the so-called “oligarchs”—powerful businessmen with direct influence on Latvian politics. On May 28, the Saeima (parliament) voted against lifting the immunity of oligarch Ainārs Šlesers, a parliamentary deputy accused of money-laundering, bribery, and other crimes. President Valdis Zatlers responded to the vote by calling for a referendum on dissolution of the Saeima, which he said was controlled by oligarchs. The referendum took place on July 23, after Zatlers himself had lost a reelection bid in parliament to Andris Bērziņš, one of the richest men in Latvia and a member of the Union of Greens and Farmers party linked to oligarch Aivars Lembergs. The referendum to dissolve the Saeima succeeded with 94 percent support and a new government was elected on September 17. Incumbent prime minister Valdis Dombrovskis was elected once again to guide the government, along with 63 deputies from the previous parliament; however, two of Latvia’s most notorious oligarchs, Ainārs Šlesers and Andris Šķēle, failed to win seats.
National Democratic Governance. The accumulated stress of the government’s austerity measures and the political power of so-called oligarchs led to snap elections on September 17. Incumbent prime minister Valdis Dombrovskis was elected once again to guide the government, along with 63 deputies from the previous parliament. Two oligarchs who had become a focal point of public frustration lost their parliamentary seats and a party closely aligned with a third oligarch was left out of the ruling coalition. Three center-right parties with compatible ideologies won a total of 56 deputies in the 100-member chamber. The passage of the 2012 budget on December 15 was a significant indicator of solidarity. Latvia’s national democratic governance rating remains at 2.25.
Electoral Process. Snap national elections called by President Valdis Zatlers in May and approved by a popular referendum on July 23 were held September 17. Five of thirteen contending parties were elected without any registered major incidents or accusations of overspending. Monitors from the Organization for Security and Cooperation in Europe commended the organization and competitiveness of the elections. Due to the administration of fair and transparent elections, Latvia’s electoral process remains at 1.75.
Civil Society. Over thirteen thousand nongovernmental organizations (NGOs) were officially registered in 2011, representing all major viewpoints and interests in Latvian society. Many of these groups routinely contributed to political decisionmaking, banding together in larger umbrella organizations. The most politically engaged and vocal civil society groups are the business community, labour unions, farmers, and environmental, religious, and ethnic groups. In view of the continued activism and acceptance of NGOs in policymaking, Latvia’s rating for civil society remains at 1.75
Independent Media. Media in Latvia are experiencing great turbulence. As part of a larger trend in the media industry, newspapers are losing readers and advertising and print media faces growing threats to sustainability. Television is also undergoing a period of financial stress and losses, which may lead to consolidation through takeovers. Nevertheless, the country boasts a vast array of media sources in two major language streams. Latvia’s rating for independent media remains at 1.75.
Local Democratic Governance. The reorganization of 530 municipalities into 118 larger and more cohesive units has progressed without major problems. The year saw increasing cooperation between local and central authorities through the Association of Local and Regional Governments (LALRG), whose chairman has become an effective lobbyist for municipal interests, meeting with ministers and the president on a regular basis. Also, certain local governments with common problems have created their own mechanisms for discussions and decisionmaking. Latvia’s rating for local democratic governance remains at 2.25.
Judicial Framework and Independence. Latvia’s judiciary manages cases with increasing efficiency, improving its image as a trusted institution. The court system is still overburdened and underfinanced, but certain improvements—including the use of modern technology, the acceptance of decisions by correspondence, and the diversion of certain uncontested cases to notaries—promise to expedite future judgements and reduce the backlog. The ombudsman’s office has also expanded its ambit and is receiving greater public visibility. Latvia’s rating for judicial framework and independence remains 1.75.
Corruption. The year 2011 saw several important developments in Latvia’s fight against corruption. The September 17 parliamentary elections ousted two powerful businessmen from parliament and significantly reduced the representation of the Union of Greens and Farmers, a party controlled by the oligarch Aivars Lembergs. The deeply unpopular head of the Corruption Prevention and Combating Bureau (KNAB) was dismissed in June 2011 and replaced with another, more respected KNAB official with a strong anticorruption track record. The organization actively pursued major corruption cases throughout the year; by September, KNAB had already begun 14 criminal proceedings—the same number initiated in all of 2010. Effective in 2012, the state financing of parties and decision to criminalize violations of campaign finance laws will pose important obstacles to potential abuse. As a result of these improvements, Latvia’s rating for corruption improves from 3.50 to 3.25.
Outlook for 2012. Latvia appears to have weathered the most difficult period of the economic crisis. However, one result of extensive austerity measures has been largescale outmigration by young, educated people. This will soon exacerbate existing labor shortages and strain the potential growth of economic enterprises. Weaker economic vibrancy may in turn limit investments in key Latvian institutions, including those integral to democratic accountability. There are economic and political pressures for Latvia to become more oriented towards Moscow. Many entrepreneurs want to tap into the potential economic opportunities they perceive in Russia. The Russophone party, Harmony Center, and most Russophone media outlets want an increased rapprochement with Russia. The present coalition of three parties appears stable, but forging new policies to deal with grave problems under severe financial constraints may lead to divisions and changes within the ruling coalition.
Widespread optimism and rising government approval ratings in the wake of the October 2010 Saeima (parliamentary) elections did not last long, as the ruling coalition of Unity and the Union of Greens and Farmers struggled to cope with the legacy of a precipitous economic decline and the demands of the International Monetary Fund (IMF) and other world lending organizations. Tax increases, decreased social services, and cuts in public administration and other state employment soon soured the high expectations of the population, and trust in the Saeima and the government plummeted. Public confidence in government was also affected by disunity within the ruling coalition: on 30 occasions, the Union of Greens and Farmers voted against its coalition partner, Unity, and on 51 occasions it voted to support the opposition party, Harmony Centre. Meanwhile, perceived tampering in policy and personnel appointment choices by a powerful businessman, Aivars Lembergs, the éminence grise of the Union of Greens and Farmers, further fanned public discontent.
By May, the perceived dominance of so-called oligarchs in the Saeima had become a trigger for the first dissolution of parliament in Latvia’s history. Earlier in the year, Latvia’s Corruption Prevention and Combating Bureau (KNAB) opened criminal proceedings against public figures engaged in “laundering of criminally acquired assets, providing false statements in the declaration of public officials, misuse of position, receiving and giving of bribes, illegal participation in property transactions and violation of restrictions imposed on public officials.” However, on May 28 the Saeima voted against lifting the immunity of oligarch Ainārs Šlesers, a deputy accused of money-laundering, bribery, and other crimes.
President Valdis Zatlers responded to the vote by calling for a referendum on dissolution of the Saeima, declaring that the parliament “feels comfortable in its atmosphere of lies, and this has strongly influenced the government.” Of the 44 percent of eligible voters who participated in the July 28 referendum, approximately 94 percent voted in favor of dissolving the Saeima—a rare moment of unity in a country that has usually been politically fragmented.
By the time Zatlers called for the referendum, his first presidential term was nearly over and he was up for reelection on by the same body he was attempting to dismiss. Zatlers was not reelected; instead, a majority of deputies chose a relatively unknown candidate, a wealthy businessman and deputy of the Union of Greens and Farmers, Andris Bērziņš. Many felt that Zatlers’s replacement was an act of retaliation on the part of the Saeima, or a broader backlash against Zatlers’s increasingly anti-oligarch tendencies.
Snap elections on September 17 resulted in major losses for the two former coalition parties (Unity and the Union of Greens and Farmers), but increased representation for the social democratic and mainly Russian party, Harmony Center, and the nationalistically-oriented National Alliance. Harmony Center received the most votes with 31 seats, however, it proved unable to attract enough other deputies to form a working government with over 50 seats. The leading ethnic Latvian party was formed by former president Zatlers shortly before the elections, despite the expectations of Unity that he would appear on their ticket. With its 22 seats, the centrist Zatlers’s Reform Party (ZRP) was allowed to take the initiative in forming a ruling coalition, in tandem with the Unity Party and its 20 deputies. Initially, Zatlers hoped to form a coalition including Harmony Center, purportedly to create a cross-national, inclusionary government; however, ZRP’s failure to involve Unity in this decision caused the deal to fall apart. Zatlers also lost six deputies from his own party by repeatedly turning to his former presidential advisors on issues of coalition-forming and political strategy instead of consulting his own deputies. Ultimately, ZRP formed a ruling coalition with Unity and National Alliance. A new government led by incumbent prime minister Valdis Dombrovskis was finally approved on October 25 with the support of 57 out of 100 Saeima deputies.
The most significant outcome of the election is undoubtedly the reduced presence in the Saeima of former heavyweight oligarchs such as Ainārs Šlesers and Andris Šķēle, both of whose parties were dissolved by year’s end. The Union of Greens and Farmers now controls only 13 of 100 seats in the Saeima, having won only 12.22 percent of the vote. In October 2011, several important changes were introduced which have the potential of further limiting oligarch power. New amendments to the party financing law provide a solid wall against improper donations, making them subject to criminal prosecution. Beginning in 2012, all parties receiving over 2 percent of the vote and still officially registered will receive annual state payments equivalent to US$1 per vote received at the previous national elections. Such payments should lessen dependence on outside donations by rich individuals with private agendas.
The call for the dismissal of the Saeima by President Zatlers and the subsequent referendum affirming this dismissal appeared to energize and empower voters. However, subsequent squabbling between parties in the formation of a government soon led to disillusionment and pessimism. Russophones, in particular, felt neglected, with their party, Harmony Center—the election’s biggest winner—relegated to opposition benches. Former president Zatlers has also lost much influence as a result of postelection conflicts. He was not elected speaker of the Saeima and by the end of October 2011, his personal approval rating was just 17 percent. Prime Minister Dombrovskis's popularity also declined during the year, from nearly 60 percent in May 2011 to around 42 percent in December.
Major economic, taxation, demographic, bureaucratic, and linguistic problems facing Latvia will no doubt test the capability and solidarity of the new coalition. The first major test of the coalition’s cooperation—passage of the 2012 state budget—was achieved in December.
Latvia holds popular elections for the national, local, and European parliaments, but the president of the republic is elected by the Saeima. On June 2, the Saeima elected a new president, leaving former president Valdis Zatlers free to form a new party, the ZRP, and compete in the snap parliamentary elections of September 17.
The September Saeima elections were organized in five electoral districts—Riga, Vidzeme, Zemgale, Kurzeme, and Latgale—using party-list proportional voting. The parties of the incumbent ruling coalition—Unity and the Union of Greens and Farmers—suffered significant declines compared to the October 2010 parliamentary elections, losing 13 and 9 seats, respectively. A large number of Unity’s voters were siphoned off by the newly-formed ZRP, which won 20.82 percent of the vote and 22 seats in parliament. The Latvian nationalist party National Alliance also increased its presence in the Saeima, winning 14 seats compared to the previous year’s 8. Harmony Centre, meanwhile, increased its seats from 29 to 31, drawing most of its support from Riga and largely Russophone eastern Latvia. Eight additional parties competed in the election but were unable to meet the 5 percent electoral threshold for representation in parliament.
Of the 1092 candidates put forth by 13 parties, 70 percent were men. Seventy-two percent were ethnic Latvians and 11 percent were Russian. Voting activity declined somewhat with a total of 59.49 percent compared to 62.62 percent in the 2010 elections. Considering the apparent public antipathy towards the previous parliament, it is noteworthy that 63 of the 85 incumbent deputies listed on the 2011 ballot were reelected.
According to the Organization for Security and Cooperation in Europe (OSCE) observers, the elections were democratic and marked by the rule of law. The elections were run with respect for citizens’ fundamental freedoms as voters were provided genuine choices between diverse parties. The OSCE delegation did highlight the fact that 16 percent of Latvia’s adult population are non-citizens and not allowed to vote. These people do have the choice of acquiring Latvian citizenship with minimal language and other requirements commonly found in most other Western countries.
As of February 2011, there were 13,284 registered nongovernmental organizations (NGOs) in Latvia, almost two-thirds of which were founded after Latvia joined the European Union (EU) in 2004. The EU has encouraged the formation of interest groups and has also provided financing for various research and advocacy efforts by civil society organizations. In a largescale public survey released in April 2011, approximately 40 percent of Latvians claimed to have joined or participated in voluntary social groups or activities in the past three years. However, only 15.3 percent of respondents believe that by doing so they can influence political decisionmaking.
Most nongovernmental activity relies on volunteers; only 27 percent of NGOs have one or more salaried employees. Funding is largely dependent on individual projects, therefore most efforts are led by the demands of project sponsors, and longterm financial planning is extremely difficult. The challenges to NGO sustainability have become particularly acute since the onset of the economic crisis.
The majority (62 percent) of registered NGOs are located in Riga and the Riga region. There are ﬁve permanent state-supported resource centers for NGOs in Latvia, with additional centers providing information on funding opportunities, legal issues, and technical support. Many groups are also served by umbrella organizations such as the Civic Alliance-Latvia which unites over one hundred organizations and provides advice and often acts as a more powerful instrument for reaching centers of decisionmaking.
One notable source of increasing public engagement in political decisionmaking has been the advent of online political petitions and webportals designed for communication between politicians and their constituents. Launched in June 2011, the portal ManaBalss.lv (“My Voice”) allows individuals to circulate and sign social and political proposals that can later be heard in parliament if the number of signatures from eligible voters reaches 10,000. The platform gained some visibility in the summer through the support of former president Zatlers, who transmitted a widely supported initiative from ManaBalss.lv to the Saeima, eventually resulting in a law requiring publication of information about owners of Latvian offshore companies. Another website, launched in late 2010 by the Riga-based public policy center Providus, allows individuals to submit questions directly to members of parliament. A third web platform, launched by the government in the last three years, allows visitors to track the progress of legislative bills under consideration by the state and even offers commentary and explanation of proposed bills from legal experts.
In 2011, two major linguistic campaigns initiated via the internet reflected the more radical demands of the Latvian and Russophone communities. Many Latvians view Russian as the language of their former occupiers, and worry that Moscow is still attempting to wield influence in Latvia through the country’s sizeable ethnic Russian minority. In 2010, a Latvian Language Action Committee made up of members from the National Alliance party and an organization called Sargi valodu un Latviju (“Guard the Language and Latvia”) began gathering signatures for a proposed constitutional amendment making Latvian the only official language of primary education in public schools. By February 2011, the group had collected the 10,000 signatures necessary for the initiative to be presented to the Central Election Commission (CVK); however, when CVK organized a second, official petition for the same initiative, it did not collect the necessary support needed to qualify the measure for consideration in parliament.
In response to the Latvian language initiative, the Russophone youth group Vienota Latvija (United Latvia) began a campaign to make Russian the second official language of Latvia. Russophone activists successfully collected the signatures required for both the first and second round of petitions. Therefore, although parliament voted against the demanded changes, a referendum on the issue was scheduled for February 18, 2012. Chances of the measure passing are very slim, but both language-focused campaigns caused a major uproar during 2011, deepening tensions between the country’s two major ethnic groups and reducing the likelihood of any ruling coalition that would include Harmony Centre.
Additional symbolic jousting between Russian and Latvian groups occurs annually in Latvia with the remembrance of certain historical events. In March 2011, the Latvian legionnaires, who gather every year to commemorate those who fought against Stalin’s Red Army during World War II, were denied a permit to lay wreaths at the Freedom Monument by the Riga City Council, whose mayor is Russian. Ultimately, a regional court overruled the decision.
Latvians enjoy a diverse range of news and information services in two languages. However, economic pressures on the media have increased dramatically since 2007, threatening diversity and pluralism. Such pressures raise questions about the ability of the country’s Fourth Estate to fulfill its watchdog function at a time when Latvian society is expressing its preference for more transparent and less corrupt governance.
There is widespread public speculation that the so-called oligarchs and political economic groups are consolidating their control over major media outlets. In October 2011, leaked recordings from an investigation by the anticorruption bureau KNAB revealed that the joint-stock media company Diena belonged to Latvia’s three most notorious oligarchs, Šlesers, Šķēle, and Lembergs—not to the official owner, Viesturs Koziols. The same tape also records the oligarchs discussing a merger between the Diena newspaper and a daily newspaper Neatkariga Rita Avize, widely linked to the oligarch Aivars Lembergs. These revelations followed the passage of a September 2011 amendment to the 1991 Media Law, requiring all media outlets to disclose their true beneficiaries. The same amendment includes provisions to safeguard editorial independence and clarifies some registration processes for media outlets.
Since 2007, Latvia’s media have seen brutal declines in advertising revenues, which shrank by 46 percent in 2009 and 13 percent in 2010. Between 2007 and 2010, advertising in newspapers fell by 75 percent and by 74.9 percent in magazines. During the same period, television advertising dropped by 40.8 percent, radio by 50 percent, and internet advertising by 30.4 percent. Both television and online advertising appeared to stabilize during 2010; by the first half of 2011, there was an overall advertising growth of 4 percent.
The public broadcasting service has also suffered during Latvia’s economic crisis. Broadcast administrators have grappled with serious personnel problems related to insufficient funding and low salaries. In 2011, a popular public affairs program by investigative journalist Janis Domburs could not be renewed for budgetary reasons. Meanwhile, another popular public affairs critic, Karlis Streips, was fired in September from his political talk show of 16 years when he referred to the Union of Greens and Farmers as “whores” because of its close association with Lembergs. Streips’ dismissal elicited sharp public criticism. Latvian television is rapidly losing its audience share. State-owned radio broadcasting stations, however, maintain over one-half of Latvia’s radio audience.
Several Latvian internet portals have become major news purveyors, edging out traditional media sources. Among these are the online news portals Tvnet.lv (owned by Schibsted of Norway and Estonia), Delfi.lv (owned by Ekspress Grupp of Estonia), Apollo.lv (owned by Sanoma News of Finland), and the online magazine Baltic Course (owned by a Russian Latvian). The online magazine Kas Jauns (“What’s New”) provides a synthesis of news from other sources and is rapidly gaining in popularity. All three Latvian and three Russian language dailies provide online content, as well. A group of journalists that broke away from Diena in 2009 continues to publish a respected investigative weekly called Ir, available in print and online. Several investigative or Wikileaks-style websites are also active, including Pietiek.lv (“Enough”), which exposes scandals on a regular basis. For the moment, internet censorship does not extend beyond some basic rules regarding privacy and child pornography.
In November 2011, Latvia’s National Electronic Media Council (NEMC)—the state regulatory body—brought charges against the predominantly Russian-language TV5 for discrediting it during a “street interview” in which passers-by were asked whether or not Russian should be established as Latvia’s second state language. TV5 refuted NEMC’s accusations, arguing that in a democratic country, people have the constitutional right to express their views. In the past, NEMC has made several similar accusations against TV5, forcing two of the station’s journalists—anchorman Olegs Ignatjevs and news director Vladislavs Andrejevs—out of their jobs.
Latvia’s municipalities underwent largescale structural reforms in 2009, reorganizing more than 530 local units into 109 municipalities and 9 cities. These reforms entailed major readjustments in leadership and administrative personnel, disrupted existing communications networks, and reassigned or removed various geographical reference points. Local governments received little publicity in the national media in 2011, signaling the adjustment and uneventful functioning of the new municipalities. However, throughout the year, local governments felt the pressure of decreased funding, unemployment, outmigration of young people to urban centers and other EU states, and lack of specialized labor.
The responsibilities of municipalities include primary and secondary education, social assistance (with the exception of pensions and family care benefits), healthcare, water supply and sewage works, country roads, solid waste collection and disposal, and stewardship of about one-fifth of all housing in Latvia. The processes of governance vary according to the size of the municipality, but all are based on fundamental democratic foundations, such as open council and committee meetings and freely available meeting minutes; voter access to council members and executive officials; procedures for review of complaints and suggestions; public discussions; and audited annual reports and reviews of government budgets, spending, assets, and activities. Citizens also have recourse to municipal elections every four years. Almost all local governments maintain webpages, with transcripts of council meetings, news, social events, and advice on a variety of issues from health to farming and gardening.
There was a time when local government representatives were known to be highly partisan, directly serving the interests of national parties. This frequently led to favoritism in national government funding of special projects at the local level. With the demise of the notoriously partisan People’s Party in 2010 and the decline of the Union of Greens and Farmers, these practices have become much more muted. Municipal leaders from all parties voluntarily belong to the Association of Local and Regional Governments (LALRG), a powerful organization with the authority to represent municipalities in negotiations with the Cabinet of Ministers. The longtime chairman of the LALRG, Andris Jaunsleinis, has become an effective lobbyist for municipal interests and meets with ministers and the president on a regular basis. Additional, issue and interest–based groupings of municipalities exist, cutting across what were once rigidly partisan lines. For example, in October 2011, coastal municipalities came together to discuss sea coast jurisdictions, requirements for safe and clean beaches, and government support and subsidies for fisheries.
Throughout 2011, local governments struggled with a decreasing income tax base caused by widespread unemployment and outmigration. Local government budgets have decreased significantly since 2007. Currently, 82 percent of income tax collected by the national governments goes to local government budgets, but in 2012, the assigned share will decrease to 80 percent. Many municipalities are now faced with the burden of supporting a growing number of residents who rely on welfare, and many impoverished residents are unable to pay their heating bills. Negotiations are underway between the ministries of finance and the new minister of environmental protection and regional development over increasing mandatory contributions to the Municipal Finance Equalization Fund, which transfers money from rich municipalities to poor ones. The city of Riga has always been a reluctant contributor to municipal equalization; now with a substantial budget deficit, Riga must contribute 10.7 percent of its budget to the fund. Under these circumstances, the distribution of EU structural funds has become increasingly contentious. At the 2011 LALRG congress, municipalities lobbied to have one full third of the LV 1 billion promised by the EU for the 2014–20 funding cycle given directly to local governments to address their greatest needs, including poor road conditions.
Latvia, unlike neighboring Estonia, allowed its Soviet-era judiciary workers to retain their posts after the country gained independence, preserving a culture of cronyism and inefficiency within the court system. Through normal attrition most of these judiciary workers have been replaced by much younger cadres with Western judicial orientation. Moreover, many weak areas of the system have been reinforced or eliminated. The increased salaries and prestige of judges, the active work of anticorruption organizations, and the electronic processing of judgements have also strengthened the efficiency of the court system. A 2011 survey by the Latvian Judicial Training Center (LJTC) reported that 79 percent of citizens who have dealt directly with the court system trust the judiciary. This stands in contrast to the broader public’s trust of the courts, which was as low as 36 percent according to a late 2010 Eurobarometer poll. Lawyers polled by the LJTC pointed to lengthy case decision periods, lack of privacy in waiting rooms, and parking as the most serious drawbacks of working in the Latvian justice system.
The creation of the Judicial Council in September 2010 has encouraged collective problem-solving and initiative among judicial officers. While caseloads are still considered excessive, new steps have been taken by the Judicial Council to speed up the court process. Small court claims where the sum involved does not exceed US$3,000 can be processed by correspondence, although a court hearing option remains. Uncontested divorces are now settled by notaries. Notaries have also indicated their readiness to take over all uncontested court cases. Another cause of delayed judgements is the high absentee rates of litigants due to apparent illness. A new regulation of October 2011 requires a doctor’s note outlining the particulars of the disability which will be evaluated by the judges concerned. More judges have also been appointed and some transferring of judges from the less burdened land registry courts to district and regional courts was underway at year’s end.
Despite these improvements, the court system still faces a number of challenges related to its budget. In 2011, administrative personnel in the judiciary received an average monthly wage of LVL 351.6 (US$703) compared to the national monthly average of LVL 467 (US$933.70); they have declared willingness to go on strike. Courts in 2011 had to cope with security problems, as local police refused to work because of budget cutbacks and courts had no finances for security guards. The courts lack the resources to store old documents, and state archives have refused to house them without additional financing. Judges have also expressed disappointment that their salaries have not increased as much as they originally expected. Base salaries for district court judges are fixed at 4.5 times the average income in the state sector with added differentiation for length of tenure and qualification. The sum is small by Western standards—only LVL 1,157 (US$2,314) a month for a base salary.
On March 3, the Saeima elected a new ombudsman, Juris Jansons. Jansons, who boasts a law degree, a masters in economics, and the beginnings of a Ph.D in sociology, has already raised the visibility of the ombudman’s office by speaking out on controversial or publicity-gathering topics. He has challenged the State Revenue Service for collecting taxes that had not received parliamentary acceptance. He has criticized the raising of electricity rates by Latvenergo, Latvia’s biggest state-owned energy company. Beginning in November 2011, the ombudsman’s office received funding from the Germany-based Ebert Fund to study emotional aggression and hate speech on the internet. In addition, the ombudsman office has asked the public to discuss the issue of same-sex marriages.
In October, the constitutional court lifted the immunity of constitutional court judge Vineta Muizniece, allowing the prosecutor general’s office to bring criminal charges against her. Muizniece is accused of falsifying documents in her previous position as chair of the Saeima legal affairs committee. Muizniece has been suspended as a judge until a final judgement is made.
Latvia’s twelve prisons, which are old and dilapidated, have also been the subject of ongoing criticism. In men’s prisons, 20 to 30 people are crowded together into a single space creating many internal conflicts. The prison system has witnessed a dramatic drop in its budget allowance from LVL 36.8 million (US$73 million) in 2008 to LVL 20.5 million (US$41 million) in 2010. As a result, there have been cutbacks in food quantities, heating, construction of new prisons, and guard wages. At the beginning of 2011, Latvian prisons held 6,780 inmates or 301 inmates per 100,000 population—a decrease since 2009, when the ratio was 346 inmates per 100,000 population. The rate is very high compared to Scandinavia’s, where the averages are below 80, but lower than in the United States (743) or Russia (577).
Increasing frustration with corruption and the influence of oligarchs in parliament was a major theme in public discourse in 2011. When parliament elected Andris Berzins, an ex-banker and member of the Union of Greens and Farmers (a pocket party of oligarch Aivars Lembergs), president, several public figures and anti-oligarch activists organized a public demonstration called the “Oligarchs’ Funeral” in Riga on June 8. The demonstration attracted thousands of participants, reflecting public frustration with Latvia’s slow economic recovery and a growing consensus that the 10th Saeima was ignoring the corruption concerns of its electorate.
The anti-oligarch mood was echoed in the results of a popular referendum to dissolve parliament in July, which was instigated by outgoing President Zatlers in response to perceived corruption in the Saeima and approved by over 94 percent of voters. A poll conducted one month earlier also reported that 89 percent of economically active participants agreed oligarchs Ainārs Šlesers, Andris Šķēle, and Aivars Lembergs wielded undue influence over the work of the Saeima, the government, and other state institutions. The snap parliamentary elections held on September 17 ousted Šlesers, a member of the so-called oligarchs’ bloc party For a Good Latvia, and largely diminished the representation of the Union of Greens and Farmers.
The newly-elected 11th Saeima includes deputies with strong anticorruption credentials. Among these are two returning deputies—former KNAB Director Aleksejs Loskutovs (Unity) and world renowned corruption specialist Rasma Kārkliņa—and also Lolita Cigane of Transparency International Latvia (a.k.a. Delna). Another new deputy, Valdis Liepins, is an articulate and business-savvy deputy in ZRP, known for his anticorruption work on the Riga city council.
The People’s Party of Andris Šķēle did not participate in the September 17 elections, having been dissolved in July to avoid a large penalty initiated by the anticorruption bureau KNAB. On September 22, the Administrative Affairs Senate of the Supreme Court upheld KNAB’s decision to fine the People’s Party LVL 1.03 million for spending illegal funds on its highly successful “positivism campaign” in 2006. While the fine cannot be collected now, the verdict sent a strong message about illegal party spending and confirmed the Supreme Court’s immunity to pressure from oligarchs.
Leading oligarch Aivars Lembergs, mayor of the port city of Ventspils, also suffered major legal and financial setbacks in 2011. He was charged in the United Kingdom by the co-owners of Latvian shipping company, “LASCO," for allegedly siphoning large sums of money from their corporation. Though Lembergs declined to participate in court proceedings, pleading illness, on April 20 the High Court of England and Wales froze Lembergs’ assets, valued at US$135 million. A Latvian court also approved the freeze. As a result of missing his first British court appearance, Lembergs was fined an additional £10,000. On November 16, at a court session involving Lembergs, judges decided to meet several more times in the future to resolve the conflict.
On June 16, the head of KNAB Normunds Vilnitis, who had been appointed in March 2009 by Prime Minister Godmanis under questionable circumstances, was dismissed. The dismissal was seen as another major turnaround in the struggle against corruption as Vilnitis was accused of purposely reducing the organization’s capacity and seriously damaging its prestige. On November 17, parliament appointed KNAB Deputy Director Jaroslavs Strelcenoks chief of the organization. Strelcenoks has worked within KNAB since 2005 and is highly respected by his colleagues.
KNAB is funded from the national budget and has therefore lost significant funding since the onset of the economic crisis. In 2011, the organization’s annual budget was further reduced to LVL 2.4 million (it was LVL 3.58 million in 2007). Nevertheless, by October 2011 KNAB had already begun 14 criminal proceedings, the same number initiated in all of 2010. It also continued its investigation of several ongoing cases, some of which are several years old. The oldest case still pending concerns the September 2003 “digital-gate,” where sophisticated operators, led by oligarch Šķēle, allegedly tried to illegally appropriate state shares of the Latvian Mobile Telephone company. Twenty people so far have been charged in the case. Another ongoing case, known as the Ludza contraband case (filed in October 2007) involves 13 customs individuals. The “Latvenergo” case (filed in June 2010) deals with largescale bribery and money laundering.
In February 2011, police made arrests in connection with alleged bribes given to Riga City Council officials by German carmaker Daimler from 2006–08. According to an investigation by KNAB and German law enforcement, Daimler officials paid more than €4 million in bribes to win contracts for supplying Mercedes buses to municipal authorities in Riga. Since early 2010, investigations of similar bribery by Daimler have been pursued in several countries, including Russia, Hungary, Greece, and China. The other widely publicized, ongoing investigation of 2011 was the so-called “oligarch case” built by KNAB and based on secretly taped conversations, confiscated diaries, and 40 raids on the homes or offices of Latvian oligarchs. The case, a complex story involving charges of bribery, money-laundering, and abuse of office. According to the newsportal Zz.lv, Ainars Šlesers had attempted to legalize his previously undeclared property holdings in the Riga Commercial Port through a complex, multilayered scheme involving Andris Šķēle.
As investigations of corrupt actvities escalate, so does the necessity to monitor the legality of those investigations. In 2007, members of the Financial Police wiretapped conversations of journalist Ilze Jaunalksne and leaked them to the media, violating the confidentiality of Jaunalksne’s sources. After years of legal appeals, three members of the financial police charged in the case were given prison sentences in June 2011.
In June 2011, amendments to the Law on Prevention of Conflict of Interest in Activities of Public Officials entered into force, providing legal protection to government officials who “whistleblow” about conflicts of interest in their institutions. Other small but significant steps were undertaken to lessen opportunities for corruption among customs personnel and border police In September, the government passed another new law designed to reduce corruption in politics by limiting illegal campaign donations. As of January 1, 2012, the state will pay an annual stipend to all officially registered parties receiving over 2 percent of the vote. Moreover, individuals tied to large, illegal campaign donations will now face criminal prosecution.
 "Eurostat: Emigration," Eurostat, 4 February 2012, http://epp.eurostat.ec.europa.eu/tgm/table.do?tab=table&plugin=0&language=en&pcode=tps00177.
 “Provisional results of the Population and Housing Census 2011 in Latvia,” European Statistical System, 19 January 2011, http://epp.eurostat.ec.europa.eu/portal/page/portal/pgp_ess/news/ess_news_detail?id=109483139&pg_id=2417&cc=LV_LATVIA.
 Corruption Prevention and Combating Bureau (KNAB), Progress and Results in Preventing and Combating Corruption in Latvia (Riga: KNAB, January-September 2011), http://www.knab.gov.lv/uploads/eng/periodic_update_september_2011.pdf.
 “Atlaistas 10. Saeimas aktivakais debatetajs-Skele” [The most active debater of the dismissed 10th Saeima – Skele], Delfi, 13 October 2011, http://www.delfi.lv/news/national/politics/atlaistas-10saeimas-aktivakais-debatetajs-skele.d?id=41161523; “ZZS atlaistas Saeimas laika 51 balsojuma blokejusies ar SC prêt Vienotibu 30” [The ZZS voted 51 times in concert with SC and 30 times against Vienotiba during the period of the dismissed Saeima], Diena, 14 August 2011, http://www.diena.lv/latvija/politika/zzs-atlaistas-saeimas-laika-51-balsojuma-blokejusies-ar-sc-pret-vienotibu-13897997.
 “The good guys are losing ground in Latvian struggle,” EuropeanVoice.com, 1 June 2011, http://www.europeanvoice.com/article/imported/the-good-guys-are-losing-ground-in-latvian-struggle/71240.aspx.
 “Berzinu ievele par Valsts prezidentu” [Berzins is elected state president], TVnet, 2 June 2011, http://www.tvnet.lv/zinas/latvija/379748-berzinu_ievele_par_valsts_prezidentu/video. Berzins received 53 votes for and 44 against. The other candidate, Zatlers, received 41 votes for and 56 against.
 “Saeima Ministru Prezidenta amata atkartoti apstiprina Valdi Dombrovski” [The Saeima again approves Valdis Dombrovskis as prime minister], Saeima.lv, 25 October 2011, http://www.saeima.lv/lv/aktualitates/saeimas-zinas/18943-saeima-ministru-prezidenta-amata-atkartoti-apstiprina-valdi-dombrovski.
 “Jau tris partijas pieteikusas sanemt valsts budzeta finansejumu” [Already three parties have registered to receive financing from the state budget], Delfi, 15 October 2011, http://www.delfi.lv/news/national/politics/jau-tris-partijas-pieteikusas-sanemt-valsts-budzeta-finansejumu.d?id=41198737; KNAB, “Kriminallikuma grozijumu mazinas iespejas nelikumigi finanset politiskas partijas” [Changes in criminal law will lessen the possibilities of illegally financing political parties], press release, 8 September 2011, http://www.knab.gov.lv/lv/knab/press/article.php?id=339015.
 “Gandriz 70% iedzivotaju sliktas domas par Zatlera politisko darbibu”, [Almost 70 percent have negative attitude regarding Zatler’s political activities], Delfi, 24 October 2011, http://www.delfi.lv/news/national/politics/gandriz-70-iedzivotaju-sliktas-domas-par-zatlera-politisko-darbibu.d?id=41355527.
 “Kā Jūs vērtējat LR Ministru prezidenta Valda Dombrovska darbību?” [How do you assess Prime Minister Dombovskis’s work?], Latvijas Fakti, April 2012, http://www.latvianfacts.lv/portals/pētījumi/grupa/26.
 Official election results from the Central Election Commission of Latvia.
 “11 Saeimas velesanas piedalisies 13 partiju saraksti” [In the 11th Saeima elections, 13 party lists will participate], Ir, 18 August 2011, http://www.ir.lv/2011/8/18/11-saeimas-velesanas-piedalisies-13-partiju-saraksti. “Saeima neieveletie deputati stasies bezdarbniekos” [The unelected Saeima deputies will join the unemployed], TVnet, 8 October 2011, http://www.tvnet.lv/zinas/latvija/394870-saeima_neieveletie_deputati_stasies_bezdarbniekos.
 Organisation for Security and Cooperation in Europe (OSCE)/Office for Democratic Institutions and Human Rights (ODIHR),“Latvian parliamentary vote marked by pluralism and respect for fundamental freedoms, OSCE observers say,” news release, 18 September 2011, http://www.osce.org/odihr/elections/82573.
 Baltic Institute of Social Sciences (BISS), Parskats par NVO sektoru Latvija [Review of the NGO sector in Latvia], (Riga: BISS, April 2011), http://www.biss.soc.lv/downloads/resources/SIF_Parskats_par_NVO_sektoru_Latvija.pdf.
 Latvian law dictates that once the initial 10,000 signatures have been verified by the Central Electoral Commission, the CKV must begin a second collection of signatures over a period of several weeks. This time, the project must receive signatures tallying more than 10 percent of voting participants in the previous national elections in order to be considered by parliament. If a project received the necessary 10 percent but is rejected by parliament, it must be put to a nationwide referendum.
 “Elerte: Referindums nav veids ka stiprinat latviesu valodas lietosanu skolas”[Elerte says the referendum is not the way to strengthen Latvian language use in schools], Diena, 10 May 2011, http://www.diena.lv/sabiedriba/politika/elerte-referendums-nav-veids-ka-stiprinat-latviesu-valodas-lietosanu-skolas-778914.
 Oligarhi grib apvienot laikrakstu “Diena” un “Neatkariga,” [The oligarchs want to merge the newspapers “Diena” and “Neatkariga”], TVnet, 23 October 2011, http://www.tvnet.lv/zinas/kriminalzinas/396743-oligarhi_grib_apvienot_laikrakstus_diena_un_neatkariga .
 See “The Latvian Media Advertising Market has Decreased by 13% with 45.89 million LVL in 2010,” TNS Latvia, 9 March 2011, http://www.tns.lv/?lang=en&fullarticle=true&category=showuid&id=3409 and “The Latvian Media Advertising Market has Decreased by 46% with 52.7 million LVL in 2009, ” TNS Latvia, 17 February 2010.
 Juris Kaža, “Latvian Talk Show Host Booted After 16 Years for Calling Politicians ‘Whores’,” Free Speech Emergency in Latvia, 22 September 2011, http://freespeechlatvia.blogspot.com/2011/09/latvian-talk-show-host-booted-after-16.html.
 “Premjers: butiskakas problemas patlaban ir LTV vadiba”, [The premier: the most substantial problems presently are in the leadership of LTV], Delfi, 12 October 2011, http://www.delfi.lv/news/national/politics/premjers-butiskakas-problemas-patlaban-ir-ltv-vadiba.d?id=41143783.
 “Latvijas piekrastes pasvaldiba sanaksme Roja” [ Latvian shoreline local government meeting in Roja], Latvijas Pasvaldibu Savieniba [Latvian Association of Local and Regional Governments] , http://www.lps.lv/?task=view&article_id=2164.
 “Dombrovskis un Jaunsleinis paraksta valdibas un LPS vienosanas un domstarpibas protokolu" [Dombrovskis and Jaunsleinis sign the government and LPS agreement and differences protocol], Diena.lv, 5 December 2011, http://www.diena.lv/latvija/zinas/dombrovskis-un-jaunsleinis-paraksta-valdibas-un-lps-vienosanas-un-domstarpibu-protokolu-13918926.
 “Riga City Council’s Budget Amended by 17 Million Lats,” Baltic News Network, 11 November 2011, http://bnn-news.com/riga-city-council%E2%80%99s-budget-amended-17-millio...; “Riga City Council approves 2012 budget,” Baltic News Network, 15 December 2011, http://bnn-news.com/riga-city-council-approves-2012-budget-43640.
 “Pasvaldibam sola Saeimas atbalstu fondu pardale” [The local governments are promised support in the distribution of EU funds], Delfi, 20 May 2011, http://www.delfi.lv/news/national/politics/pasvaldibam-sola-saeimas-atbalstu-es-fondu-pardale.d?id=38621579.
 “Survey: people with court experience trust judicial systems more”, Baltic News Network, 21 March 2011, http://bnn-news.com/survey-people-court-experience-trust-judicial-system...; “Petijums: tiesam uzticas 79% to klientu” [Research: 79% of clients trust the courts], Delfi, 21 March 2011, http://www.delfi.lv/news/national/politics/petijums-tiesam-uzticas-79-to-klientu.d?id=37504939.
 Latvijas Tiesu Portals, “Tieslietu padome ierosina palielinat rajonu (pilsetu) un apgabaltiesu tiesnesu skaitu samazinot vakances zemesgramatu nodalas” [The Judicial Council initiates the enlargement of district (city) and regional number of judges by diminishing the vacancies in the land registry courts], 28 January 2011, http://www.at.gov.lv/information/about-notable-events/2011/201101/20110126-3/.
 “Par Tieslietu padomes 30.marta sedes jautajumiem” [Regarding the March 30 Judicial Council sitting], Latvian Supreme Court, 31 March 2011, http://www.at.gov.lv/information/about-notable-events/2011/201103/20110330-1/.
 Aivars Ozolins, “Viltota tiesnese” [The fake judge], TVnet, 6 October 2011, http://www.tvnet.lv/zinas/viedokli/394573-viltota_tiesnese; “ST aptur Muiznieces pilnvaras”, [The Constitutional Court abrogates the [judge] powers of Muizniece], TVnet, 3 June 2011, http://www.tvnet.lv/zinas/latvija/380049-st_aptur_muiznieces_pilnvaras.
 “Gada laika no cietuma atbrivotas 2315 notiesatas personas” [In one year 2315 incarcerated persons have been freed from prison], Delfi, 6 February 2011, http://www.delfi.lv/news/national/politics/gada-laika-no-cietuma-atbrivotas-2315-notiesatas-personas.d?id=36678657; "List of Countries by Incarceration Rate," Wikipedia, http://en.wikipedia.org/wiki/List_of_countries_by_incarceration_rate.
 “Dule ar kampanu ‘oligarhu kapusvetki’ cer sapurinat tautu” [Dule, with the campaign ‘funeral for the oligarchs’ hopes to shake the nation], TVnet, 3 June 2011, http://www.tvnet.lv/zinas/latvija/380116-dule_ar_kampanu_oligarhu_kapusvetki_cer_sapurinat_tautu.
 “Oligarchs’ Funeral,” PhotoRiga, 8 June 2011, http://www.photoriga.com/2011/06/oligarchs-funeral.html.
 “Latvian Parliament Dissolved in Referendum on July 23,” Baltic Review, 26 July 2011, http://baltic-review.com/2011/07/latvian-parliament-dissolved-in-referen....
 “81% iedzivotaju Sleseru, Skeli un Lembergu uzskata par oiligarkiem” [81 percent of inhabitants consider Šlesers, Skele and Lembergs to be oligarchs], TVnet, 7 June 2011, http://www.tvnet.lv/zinas/latvija/380454-81_iedzivotaju_sleseru_skeli_un_lembergu_uzskata_par_oligarhiem.
 “Tautpartijiesiem liek atmaksat miljonu” [The People’s Party forced to repay a million], TVnet, 22 September 2011, http://www.tvnet.lv/zinas/latvija/392940-tautas_partijai_bus_jamaksa_miljons.
 “London Court to decide on action against Lembergs in LASCO case,” Baltic News Network, 17 November 2011, http://bnn-news.com/london-court-decide-action-lembergs-latvian-shipping....
 “KNAB vaditaja amatam virza darbinieku Strelcenoku” [KNAB worker Srelcenoks is being guided to the position of KNAB chief], TVnet, 31 October 2011, http://www.tvnet.lv/zinas/latvija/397635-knab_vaditaja_amatam_virza_darbinieku_strelcenoku; “Strelcenok’s appointment to CPCB chief’s post forwarded for review,” Baltic News Network, 15 November 2011, http://bnn-news.com/strelcenok%E2%80%99s-appointment-cpcb-chief%E2%80%99....
 KNAB, Progress and Results in Preventing and Combating Corruption in Latvia, (Riga; KNAB, January-September 2011), http://www.knab.gov.lv/uploads/eng/periodic_update_september_2011.pdf. ; KNAB, Progress and Results in Preventing and Combating Corruption in Latvia, (Riga: KNAB, 2007), 64, http://www.knab.gov.lv/uploads/eng/knab_public_report_2007.pdf
 “Slesers velejies legalizet ipasumtiesibas Rigas Tirdzniecibas osta” [Šlesers wanted to legalize the ownership of the Riga commercial port], Zz.lv, 23 October 2011, http://www.zz.lv/portals/latvijas/raksts.html?xml_id=33811.
 “Jaunalksnes izspiegotajiem piespriez cietumsodu” [Jaunalksne spies given prison sentences], TVnet, 1 June 2011, http://www.tvnet.lv/zinas/kriminalzinas/379775-jaunalksnes_izspiegotajie....