The Ministry of Finance (MoF) explains that the allocation of 4.6 billion euros for the 2014-2020 programming period of the European Union (EU) funds will be fully used for investment projects and Latvia will not lose any EU funding. This is ensured by the preventive risk-compensating decisions already taken by the government - possibilities of budget overrun (over-budgeting) of up to 164 million euros for additional investments in new projects, as well as using the option given by the European Commission (EC) to re-finance at least 60 million euros of payments for heating support to vulnerable households to the EU funds programme and other reallocations of funding.
At the same time, the information published in the media about the possible loss of funding of EU funds for the 2014-2020 planning period in the indicative amount of 200 million euros refers to individual projects that will not be completed by the end of this year, and the specific projects may not receive all nationally planned EU funds co-financing for expenses after end of this year. In such cases, Latvia will also use the flexibility options offered by the EC to complete the projects at a later date, either by financing their completion by co-financing with the EU funds for the 2021-2027. programming period.
“EU fund investments are crucial instrument for the development of Latvia's economy. I can assure you that Latvia, despite various global shocks, has managed the risks and will be able to use the full EU funds allocation of 4.6 billion euros for the 2014-2020 programming period. The Ministry of Finance has enough tools at its disposal to complete the individual projects whose implementation is delayed even after the end of this year, as well as to ensure that Latvia does not lose the resources intended for it by accurately managing cash flows," emphasizes the Minister of Finance Arvils Ašeradens.
Currently, 100% of the national 2014-2020 EU funding is tied to projects. The objectives and indicators of the EU funds have mostly been achieved. Similar to other member states, the implementation of certain infrastructure projects has been affected by the world events of recent years - COVID-19 pandemic and the war started by the Russian Federation in Ukraine. Therefore, in order to prevent the financial risks of the 2014-2020 programming period and to ensure the completion of the projects, the administrative authorities use all of the nationally possible solutions and those proposed by the EC.
The full use of the allocated funding is ensured by the risk management measures introduced by the government in time and the decisions taken preventively so far - for example, the possibilities of budget overruns of up to 164 million euros for investments, which compensate for some project delays. During the entire period, the possibilities of overruns have been allocated for such purposes as energy efficiency of centralized heating, waste processing, development of health infrastructure, development of education infrastructure, energy efficiency of municipal buildings, practical orientation studies, etc. In addition, Latvia has used the opportunity given by the EC to refinance at least 60 million euros from the state budget of payments made in the previous year to support heat supply compensation for vulnerable households. Moreover, funding is redistributed between projects and within the operational program, maximizing the use of available funding and achieving goals.