RIGA, June 10 (LETA) - The current solution for equalization of local government finances is not the best and needs to be reviewed, Prime Minister Andris Kulbergs (United List) said in an interview on the Latvian Television.

"It is completely logical that no municipality can be compared with each other. There are very significant differences and each side is right," he assessed.

The prime minister stressed that a compromise will definitely have to be found. He thinks, however, that a perfect model is not possible.

Kulbergs also expressed his concern whether this "issue that has been unresolved for years" could be resolved in four months.

As reported, in March, even before the resignation of the government of Evika Silina (New Unity), the promotion of a new model for the equalization of local government finances stalled due to numerous objections.

Local governments had many objections to the draft law prepared by the Ministry of Finance to improve the system. The ministry informed at the time that it had therefore decided not to advance the draft law to the government for consideration at this stage, and that in the period ahead it was planned to continue dialogue and explanatory work with local governments, as well as with parliamentary fractions, on the basic principles of the model, which in general envisaged significant improvements and a reduction in administrative burdens.

At the end of May, the Minister of Finance of the resigned government, Arvils Aseradens (New Unity), highlighted the development of the new local government financial equalization model as one of the achievements of the former government, stressing that its aim is to ensure a more balanced and fairer system of financing local governments, while maintaining incentives for economic development in the regions.