EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 18 May 2009  
on measures on public sector remuneration with regard to central bank independence 
(CON/2009/47) 
 
Introduction and legal basis  
On 8 May 2009 the European Central Bank (ECB) received a request from Latvijas Banka for an opinion 
on a draft law on a uniform remuneration system for government and local government officials 
(employees) (hereinafter the ‘draft law’) and its possible application to Latvijas Banka. Although, 
according to its current wording, the draft law does not apply to Latvijas Banka , the consulting authority 
is aware that the Latvian Government is considering a pplying the draft law to Latvijas Banka and that it is 
highly possible that amendments will be made to the draft law during the legislative process to include 
Latvijas Banka within its scope. 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the third indent of Article  2(1) of Council Decision 98/415/EC of 29 June 1998 
on the consultation of the European Central Bank by  national authorities regarding draft legislative 
provisions1, as the draft law relates to Latvijas Banka. In accordance with the first sentence of 
Article 17.5 of the Rules of Procedure of the Eur opean Central Bank, the Governing Council has adopted 
this opinion. 
 1.  Purpose of the draft law 
The purpose of the draft law is to establish uniform conditions for determining the remuneration of public 
and local government officials and employees. The draft law sets out principles for establishing monthly wages and salaries, additional payments, bonuses and cash awards, allowances, compensation and leave. 
In all other respects the existing provisions of lega l acts governing employment will continue to apply.  
The remuneration of members of Parliament and of local government authorities, and the remuneration of 
officials approved and appointed by Parliament, w ill be established by linking it to the average 
remuneration of employees in Latvia
2. The remuneration of officials of  other public institutions will be 
set according to a scale determined by the Latvian Government3.  
                                                 
1 OJ L 189, 3.7.1998, p. 42. 
2  Article 4(1), Articles 5 and 6 of the draft law. 
3  Article 4(2) and Article 7 of the draft law. 
2 Under the draft law remuneration may be further re viewed as part of the process of drawing up or 
amending the state budget4. 
 2. General observations 2.1 The ECB recognises the very difficult economic circ umstances, both in Latvia and internationally, 
and the current efforts being made by the La tvian Government to stabilise public finances. 
2.2 As noted in the ECB Convergence Report of  May 2008 under the heading ‘Autonomy in staff 
matters’, ‘Member States may not impair an NCB’s ability to employ and retain the qualified staff 
necessary for the NCB to perform independently the tasks conferred on it by the Treaty and the 
Statute
5. In addition, an NCB may not be put into a position where it has limited or no control over 
its staff, or where the government of a Member Stat e is in a position to influence its policy on staff 
matters’6. This point has been stressed by the ECB in  its recent opinions on draft Irish and German 
legal acts on matters concerning national central bank staff7. In its opinion on draft Italian 
legislation establishing a threshold for the overall re muneration of the national central bank staff, 
the ECB also pointed out ‘that the ECB defines autonomously its staff’s conditions of employment and that this autonomy forms part of the ECB’s independence as guaranteed by Article 108 of the 
Treaty and Article 36 of the Statute [of the ESCB]’
8. 
 3. Specific observations Under the Law on Latvijas Banka, the remuneration of the Governor of Latvijas Banka, members of the 
Council of Latvijas Banka and the Board, as well as Latvijas Banka’s employees is determined by the 
Council of Latvijas Banka. The Council of Latvijas Ba nka also approves the staff numbers and positions. 
In order to protect Latvijas Banka’s autonomy in staff matters, which is a particular aspect of the principle 
of central bank independence under Article 108 of the Treaty, the Latvian authorities are under an 
obligation to ensure that any determination of the remuneration of the employees, members of the 
Council and of the Board, and the Governor of Latvij as Banka is decided in cooperation with the Council 
of Latvijas Banka, taking into account its specific centr al bank tasks and the need to ensure compliance 
with the prohibition of monetary financing in Article 101 of the Treaty
9. To this end, such cooperation 
should take due account of the views of Latvijas Banka. 
 
                                                 
4  Article 3(5) of the draft law. 
5  ‘Statute’ refers to the Statute of the European System of Central Banks and of the European Central Bank (hereinafter the 
‘Statute of the ESCB’). 
6  ECB Convergence Report of May 2008, p. 22.  
7  See paragraph 2.2 of Opinion CON/2009/ 15 and paragraph 2.2 of Opinion CON/ 2008/9. All ECB opinions are available 
on the ECB website at www.ecb.europa.eu/ecb /legal/opinions/html/index.en.html.   
8  See paragraph 3.2.2 of Opinion CON/2008/10.  
9  As implemented by Council Regulation (EC) No 3603/93 of  13 December 1993 specifying definitions for the application 
of the prohibitions referred to in Articles 104 and 104b(1) of the Treaty (OJ L 332, 31.12.1993, p. 1.). 
3 This opinion will be published on the ECB’s website.  
  Done at Frankfurt am Main, 18 May 2009. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET