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Figure 4. Public Management Input – Output model (Vanags and Vilka 2005).• Mission – to promote development of serviceproviders in the telecommunications industry, bypromoting competition and protecting interests ofservice users.• Objectives – to ensure possibility to receiveuninterrupted, safe and qualitativetelecommunication services the tariffs (prices) ofwhich comply with economically reasonableexpenses.• Input:o Activity of the PUC is financed from incomereceived by collecting state fee for regulation ofpublic services, which is fixed in the amount of0.2% from previous year’s net turnover of thecompany performing activities in the regulatedsector. In 2004 funding of PUC was 1,545,357LVL out of which 1, 337,180 LVL werereceived from pay-services and other ownincome while 208,177 LVL were foreignfinancial aid Phare 2002. When compared with2003, the income has increased by 28%;o Labour force resource has been constantlyincreasing through years of activity and in 2004it consisted of 83 employees that is by 5employees more than during the previous year.o Activity – functions defined in “Law onRegulators of Public Services” and „ElectronicCommunications Law”.• Output 1 :o Pursuant to data of the Central StatisticalBureau, 16% of goods and services in theconsumer price index basket are services withregulated price, thus the tariffs of these servicesmay significantly influence the annual inflationrate;o In year 2004 total increase of nominal prices forregulated services was 5.4% that is less than theincrease for the price level in total. This increasemainly can be explained by price increase forfuel due to increased oil price. While in 2003the nominal prices of regulated services haveincreased by 5.3% which indicates that priceincrease of regulated services in 2004 whencompared with previous period was by 0.1%more rapid.• Outcomes: PUC activity indicators are characterisedby performance of competition promotion criteria.o Reduced price of services:→ Total price of regulated services hasincreased by 5.4% in nominal prices, yet,taking into account yearly average inflationin the amount of 6.4%, in real prices the1 Since until February 20, 2006 only PUC Annualreport for 2004 was available for public, analysis doesnot include indicators about the year 2005.Annual Proceedings of Vidzeme University College “ICTE in Regional Development”, 200684