Lithuania’s deputy minister of finance owns a previously undeclared stake in the state-controlled energy company Ignitis, as does the minister of energy, LRT Investigation Team has found.
Ignitis is the country’s largest energy supply company that is majority- owned by the Lithuanian government. However, around 25 percent of shares are in the hands of private investors.
The private minority shareholders receive about a third of the company’s dividends. Ignitis has been particularly profitable recently, paying out 45.2 million euros to its shareholders in the first six months of this year alone.
Until recently, Ignitis was a monopoly supplier of electricity to Lithuania’s households, with a government commission controlling the prices. However, Lithuania has implemented a reform, opening up the market to independent suppliers and scrapping price controls. Ignitis still remains by far the largest electricity supplier.
The list of Ignitis’ private shareholders is kept a secret. However, LRT Investigations Team has asked Ignitis to share which public officials are among the company’s shareholders. One of them is Gediminas Norkūnas, deputy minister of finance, to whom Ignitis is directly subordinate.
The vice-minister bought the shares before he took office. In his declaration of interests, he mentioned the fact of the transaction, but indicated that his interests in the company ended the day before he assumed the office in the Ministry of Finance. The politician did not declare that he was still a shareholder and receives dividends from the company whose operations he can influence as a policymaker.
“This is for a specific column [in the declaration of interests] – I don’t know, the transaction is recorded there and I can confirm that yes, I have shares [in Ignitis],” Norkūnas commented to LRT when approached about his stake in the company.
After questions from the media, the politician amended his declaration and indicated his links with Ignitis.
Minister of Finance Gintarė Skaistė said she was aware of her subordinate’s personal assets, but did not see any problem with it.
“We have to look on a case-by-case basis whether the decisions that are being made are for personal benefit. And yet in this case, I trust the deputy minister that the decisions he is making are for public benefit,” Skaistė told LRT.
The exact number of shares held by Vice-Minister Norkūnas is kept secret, and it is therefore unclear how much he has been paid out in dividends during his two years in charge of Ignitis.
But he is not the only politician whose job is directly related to energy policy and who has a vested interest in Ignitis.
In order to get access to the list of shareholders, LRT Investigation Team had to become one and buy one share for 19 euros. The list includes a company linked to Minister of Energy Dainius Kreivys.
The minister owns a 40-percent stake in a company called Catus. It in turn controls another company, Norteo, which has shares in Ignitis. While Kreivys has disclosed his ownership of Catus, his declaration of interests does not mention his links to the energy company.
When approached by LRT, he said he was not aware he was an owner of Ignitis shares.
“That Norteo is a shareholder? Anyone can own one or two shares or 100. I, as an individual, have small stakes in a dozen companies. You can’t look for someone who has a few shares and say: you’re a shareholder,” Kreivys said.
Calls for investigation
Several opposition MPs have said that undeclared interests by officials represent a conflict of interests.
“When you make claims about exceptional transparency, as the government of [Prime Minister Ingrida] Šimonytė has done, I think that such actions really need to be declared, especially since the minister of energy makes decisions in the field of energy, including decisions on Ignitis. I think there was an obligation to declare,” said Agnė Širinskienė, member of the Faction of Regions.
Meanwhile, the Social Democratic Party’s group in the parliament has asked the High Official Ethics Commission (VTEK) to investigate the matter.
“The disregard by the minister and the deputy minister for the principles of transparency is worrying,” the group’s leader MP Orinta Leiputė was quoted in a statement. “In today’s context, when the public is extremely sensitive to everything related to the energy sector, such a lax attitude towards declaring a potential conflict of interest, as demonstrated by Minister Kreivys and Deputy Minister Norkūnas, makes one wonder: is it a way of avoiding the publicity, of hiding anything else?”
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