Burovs: Rēzekne might have been purposefully led to bankruptcy

Saeima State Administration and Local Government Committee Chairman Oļegs Burovs suspects the city of Rēzekne, which is in serious financial difficulties, has been deliberately led to bankruptcy, he said in an interview with Latvian Radio on January 10.

“How do I say this so I am not sued afterward. I personally suspect deliberate action to bring [Rēzekne] to bankruptcy,“ Oļegs Burovs told Latvian Radio.

“Expenditure does not add up with revenue. There was probably the idea that we would get the money from the country after that. Of course, you can budget with virtual promises, but 8.5 million is too much,” Burovs noted and emphasized that the situation in which Rēzekne has found itself is not acceptable.

Burovs will also encourage assessment of the possibility of amending the law to criminalize local government officials for bringing the deputy to insolvency. According to him, responsibility for such a situation lies not only with the management of the City Council and deputies who vote on the local government budget but also with the officials who prepare it, sign it, and “stamp” it.

He also said that the state could act more actively because it was already clear in the summer that Rēzekne had problems. But the true picture in Rēzekne is not clearly known and is perhaps even worse.

Rezekne local government has until January 22 to submit a balanced draft budget, which will also be evaluated by the responsible Committee of the Saeima. “Clearly, the state should give a loan to the municipality of Rezekne for several years. It's not five but 15-20. Clearly, future life in Rezekne will be very limited in terms of development,” Burovs noted.

According to him, there are two possible options – the financial stabilization process, possibly attracting an international audience of companies, as well, or suspending Rēzekne City Council. But Burovs agreed that in the event of an emergency election, the existing leadership could return to power.

“The municipality of Rēzekne lacks statehood, which is also economic action,” Burovs summarized.

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