The financial situation in Valka is so tense that delays in social benefit payments may begin in the coming months. Prolonged negotiations between the municipality and the Ministry of Finance have reached a deadlock.
In recent years, a number of municipalities in Latvia have faced serious financial difficulties, reports TV3 News. The most high-profile case was the city of Rēzekne, but painful measures to cut expenses have also had to be taken, for example, in Talsi.
The focus now is on the Valka region. Tax debts, delays in payments to suppliers. Last autumn, at the request of the Prime Minister, the minister responsible for municipalities visited this northern Latvian municipality. Negotiations were difficult then and remain so now. There is still no solution, and the mayor of Valka has called a press conference in Riga. It is in the capital that the fate of this border municipality will be decided. Valka is requesting a separate state grant of almost 700,000 euros to make ends meet. Otherwise, difficulties with benefit payments will soon arise.
"In the summer, if there are no additional funds, we will likely start delaying not only payments to entrepreneurs but also payments to residents. From the state's perspective, this is a very small amount. From the perspective of our residents, it is extremely important. If this money is not available, especially the most vulnerable part of the population will feel that the situation is bad," noted the chairman of the Valka region council, Vents Armands Krauklis.
According to the mayor, it cannot be said that the municipality has managed its affairs irrationally and is now expecting a handout. For example, the optimization of the school network has already been carried out, and the region is one of the leaders in building insulation. In reality, the problem is much deeper and more complex, related to Valka's unique status as effectively one city with the neighboring settlement in Estonia.
According to the municipality's leadership, almost one-fifth of residents are registered on the Estonian side, which directly affects budget revenues. This year, Valka has the lowest revenue growth among all municipalities, which does not cover the increase in expenses. This aspect needs to be addressed in the long term, in addition to urgent assistance.
A deadlock — this is how the mayor of Valka characterizes the current negotiations with the Ministry of Finance. The department acknowledges that the smallest municipality in Latvia is currently facing the most serious financial problems, but they believe there is a way out.
However, it is not the one that Valka's leadership is counting on. The Ministry of Finance emphasizes that at the moment, it plans to postpone the repayment of the municipality's principal debt of 370,000 euros.
"Of course, we see that this is not a long-term solution. We ask the municipality to revise its budget for 2026 so that next year it can fulfill its functions and settle its debts," clarified the director of the Department of Supervision of Financial Activities of Municipalities at the Ministry of Finance, Inta Komisare.
In Valka, they do not see the possibility of getting out of the situation solely through savings measures. If an agreement with the government cannot be reached, the mayor is ready to appeal directly to the members of the Saeima in this election year. Public protests are also not ruled out.
"I have quite a few public organizations that we continue to support. The Ministry of Finance says — why are you even asking for money if you support culture and sports. But if we do not support active people, and our neighbors do, they will leave Valka... Organizations are asking why I am not organizing a picket in Riga. They are even ready to block streets and roads and so on," Krauklis said.
It is expected that the government will soon consider the report from the Ministry of Finance on the financial situation in the Valka region.
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