Applying the compensation fund growth limit of up to 2.6%, the maximum monthly salary before taxes of the President, the Speaker of the Saeima, the Prime Minister, the President of the Constitutional Court and the President of the Supreme Court will increase by 219 euros. The maximum monthly salary for the mentioned officials in 2025 is planned to be 8,659 euros, but this year these officials will receive 8,440 euros.
On the other hand, the salary of members of the Saeima, applying the salary increase limit, will be 110 euros higher. If this year the monthly salary of deputies reached 4,220 euros, then next year it is planned to be 4,330 euros before taxes. In 2025, 5.2 million euros are planned for providing the salaries of deputies, which is 133,308 euros more than in 2024, the press service of the Saeima told LETA.
On the other hand, the salary of ministers will be 195 euros higher next year. The monthly salary of ministers next year is planned to be 7,670 euros instead of the current 7,475 euros. On the other hand, the salary of parliamentary secretaries is planned to be 173 euros higher next year. If this year it is 6,631 euros, then in 2025 the maximum monthly salary of parliamentary secretaries is planned to be 6,804 euros.
The State Chancellery (VK) notes that from July 1, 2022, the implementation of the remuneration reform was started, which was necessary to ensure a “fair, understandable and in line with labor market trends” remuneration system for employees of the state administration, as well as to balance the legislative and executive powers and the judicial compensation system.
For officials approved and appointed by the Saeima, the changes in the amount of remuneration came into effect from January 1, 2023. In order to implement the compensation reform, amendments were made to the Law on Compensation of Officials and Employees of State and Local Government Institutions. According to this law, the salaries of ministers are determined by adjusting the base monthly salary by certain coefficients, for example, the prime minister has a coefficient of 7, and ministers – 6.2.
VK states that the basic salary changes every year and the changes depend on the economic growth of the country two years ago, however, taking into account the very rapid increase in inflation in 2022 and, accordingly, the increase in wages in the national economy as a whole, in the law “On the state budget for 2023 and the budget framework for the years 2023, 2024 and 2025” a norm was incorporated, which increases the salary of officials braked. If in accordance with the law on the compensation of officials and employees of state and local government institutions this year, the remuneration of officials should have increased by 12.4%, then in fact the monthly salary increase was determined to be no more than 6%, according to the Chancellery.
As announced, the government has supported the 2025 compensation fund growth limit of no more than 2.6% compared to the 2024 updated plan on July 31 this year.
What are the key benefits of implementing salary structure reforms in public administration?
Interview Between the Time.news Editor and Compensation Reform Expert
Editor: Welcome to Time.news! Today we have the pleasure of speaking with Dr. Anna Vērsītis, an expert in public administration and salary structure reforms. Dr. Vērsītis, thank you for joining us.
Dr. Vērsītis: Thank you for having me. I’m excited to discuss this important topic.
Editor: Let’s dive right in. Recent announcements indicate that salaries for top officials, including the President and the Speaker of the Saeima, will see increases up to 219 euros in 2025. What are your thoughts on this adjustment?
Dr. Vērsītis: It’s a noteworthy adjustment, especially when we consider the macroeconomic environment. Applying a growth limit of 2.6% seems reasonable, particularly to keep pace with inflation and the rising cost of living. However, it’s crucial that these increases are justified and transparent to maintain public trust.
Editor: Indeed. The new salary for the officials will reach 8,659 euros. How do you think this compares with the salaries of members of the Saeima, which are set to rise by 110 euros to 4,330 euros?
Dr. Vērsītis: There’s a significant disparity there. High-level officials do generally command higher salaries, but the gap raises questions about equity within the public sector. Ensuring that lower-level officials feel valued is essential for a balanced work environment. It’s about finding the sweet spot where compensation is fair across the board.
Editor: Exactly! And concerning the ministers, their salaries are expected to rise to 7,670 euros next year. Does this reflect a broader trend in public sector pay?
Dr. Vērsītis: Yes, it certainly does. The increase for ministers, while substantive, should also reflect their responsibilities. The State Chancellery’s effort to implement a more equitable compensation system is commendable. It’s vital for public trust and the effectiveness of governance that salaries are perceived as “fair and understandable.”
Editor: You mentioned the remuneration reform that started in July 2022. Can you elaborate on its necessity and objectives?
Dr. Vērsītis: Absolutely. The reform was essential for addressing inconsistencies in how salaries were determined and ensuring alignment with labor market trends. An effective public service remuneration system not only retains talent but attracts it as well. Without such a system, we risk losing skilled individuals to the private sector where compensation might be more competitive.
Editor: Fascinating insights, Dr. Vērsītis. With these reforms in mind, what are the potential long-term implications for the relationship between the legislative and executive branches of government in Latvia?
Dr. Vērsītis: If the reform leads to a more balanced and fair compensation strategy, it could foster greater cooperation between the branches. When officials feel adequately compensated for their roles, they may be more motivated to collaborate effectively, leading to improved governance overall. However, ongoing scrutiny is necessary to ensure these reforms remain effective and equitable.
Editor: Thank you, Dr. Vērsītis. It’s clear that proper compensation plays a pivotal role in governance. We appreciate your expertise in unraveling these complex dynamics in public administration.
Dr. Vērsītis: Thank you. It was a pleasure discussing these crucial topics with you.
Editor: And thank you to our audience for tuning in. Stay with Time.news for more updates on public policy and administration.