At its meeting on March 24, the Government reviewed the amendments developed at the initiative of the Ministry of Culture to the Cabinet of Ministers' Regulations No. 421 of July 17, 2018, "Procedures for Making Changes to the Appropriations Set in the Annual State Budget Law". The amendments introduce, for the first time in Latvia, a systemic regulation by which associations and foundations can engage in projects and measures co-financed by European Union policy instruments and other foreign financial assistance and qualify for state budget pre-financing, if the implementation of these financial instruments is not regulated by other regulatory enactments.
Until now, budgetary institutions could enter into long-term state budget commitments only up to the maximum limits set forth in the State Budget Law for the fiscal year, and budgetary institutions could assume additional long-term state budget commitments only for projects and measures co-financed by European Union policy instruments and other foreign financial assistance, provided that a relevant decision of the Cabinet of Ministers had been adopted. Associations and foundations were unable to receive state budget co-financing for a range of foreign programs, including the implementation of European Economic Area programs in the civil society sector, which means that national co-financing for the implementation of these programs had to be provided from their own resources, thereby reducing the ability of Latvian non-governmental organizations to compete for foreign funding.
The regulations provide for the provision of pre-financing to associations and foundations to be integrated into the existing system of redistribution of state budget appropriations. Pre-financing from the state budget will be available to associations and foundations that implement programs in the field of civil society and that have received funding from the European Economic Area Financial Assistance Program and the Norwegian Financial Assistance Program, the Swiss-Latvian Cooperation Program or other foreign financial assistance programs, as well as associations and foundations that implement projects within the framework of projects co-financed by European Union policy instruments and other foreign financial assistance, subject to additional conditions.
Considering that pre-financing is returned to the state budget after the project is completed, these changes do not create a significant gap in the state budget, while at the same time allowing the non-governmental sector to potentially attract large financial resources for the development of civil society and citizen participation in Latvia. There is already a precedent – in 2023, The Civic Alliance - Latvia concluded the European Economic Area program “Active Residents Fund”, for the conclusion of which pre-financing of 130,000 was provided with the assistance of the Ministry of Culture. Within the framework of the program, a total of 8.5 million euros were attracted to the Latvian non-governmental sector. At the end of 2025, the entire pre-financing amount was successfully returned to the state budget.
The new regulation will significantly improve the opportunities for non-governmental organizations to participate in programs and projects, strengthen their capacity and promote the implementation of high-quality projects in various fields. By promoting investments in strengthening a cohesive society and civil society, public understanding of the role of civil society and its importance in the development of a democratic state will be improved, Latvia's international visibility will be strengthened, and the contribution of non-governmental organizations to the Latvian economy will be increased.
Information prepared by:
Alma Rudzīte
Officer of Public Relations Division, Ministry of Culture
Tel.: +371 25784795
Email: Alma.Rudzite@km.gov.lv
(Translated with the help of DeepL Translate)
