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May 17th, 2008
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Legislative limboReforms, new laws on hold as country awaits new governmentBy Kristina Alda For The Prague Post August 23rd, 2006 issue
A law Parliament passed earlier this year requiring small businesses to install cash registers by the beginning of 2007 was met with almost universal derision among business owners, who said the government had no right to mettle in their affairs. Political parties quickly responded: The Civic Democratic Party (ODS) said its first order of business if it came to power after June's general election would be to repeal the law. The Social Democrats (ČSSD) promised to amend the law. Neither has managed to do a thing since. "I would welcome if the law was changed," says Alex Novanský, owner of the Zlatá Hvězda sports pub in New Town. Novanský and others will continue to wait, as government deadlock continues nearly three months after a general election delivered a divided Parliament. Lawmakers are getting nothing done, while legislation and important reforms rest in a state of limbo, including: - Long-awaited pension reform - The privatization of many state-owned companies - An overhaul of the country's Criminal Code - The fate of the controversial flat tax A nonfunctioning Parliament costs taxpayers as much as 3 million Kč ($136,550) a day, according to the right-leaning organization eStat. The organization estimates that the country has wasted some 258 million Kč since the stalemate began, because political leaders seem unable to reach consensus about who should lead. The Finance Ministry confirms this. Some point out that Parliament accomplishes little in the summer months to begin with. But this past week's developments at the top of the government seem likely to extend the impasse into the fall. Prime Minister Jiří Paroubek resigned Aug. 16, and President Václav Klaus quickly tapped ODS leader Mirek Topolánek to succeed him. But Klaus threw a curveball into the mix: He asked Paroubek, leader of the ČSSD, to temporarily continue heading the country's government until Topolánek sets up his government. Whether Topolánek will do that is anyone's guess, since the ČSSD controls half of the seats in Parliament, which must approve whatever government Topolánek brings forth. Topolánek, in other words, is prime minister in name only, powerless to start implementing the reforms his party pledged to make in its election platform. At the same time, the ČSSD has no real mandate to draft new laws of its own, since it could be out of power any day now. A backed-up back burner The country's cash-strapped pension program was one of the hottest topics on the campaign trail leading up to June's election, but the subject has not been addressed since. A major overhaul is needed to accommodate the country's aging population: Demographers say that by 2030 this country will have some 3 million pensioners, 1 million more than today. The ODS and the ČSSD are at odds as to what reform should look like. The ODS wants to raise the retirement age from 60 to 65 and provide all citizens with a basic low pension around 20 percent to 25 percent of their salary along with the option to save money for an additional private pension fund. The ČSSD, on the other hand, wants to raise the birth rate through financial incentives and thus ensure a young work force. Whatever reforms the new government makes to the pension system now will have a long-reaching effect. And with the pensioner population what it is, the reforms cannot be put off for much longer, analysts warn. The planned privatizations of many state-owned companies are being delayed by the government deadlock, among them energy giant ČEZ, Czech Airlines, Czech Railways and the Czech Postal Service. The privatization of aircraft manufacturer Aero Vodochody was approved this spring, but the ČSSD-led government opted not to see it through until after the election. Nothing has happened. The ODS plans to sell the shares of most big state companies by 2010. So far, it hasn't been able to take any steps in that direction, while companies that might be interested in bidding are treading water. Martin Říman, the ODS's industry expert, has said the sale of big companies like ČEZ cannot be accomplished in the government's four-year term, and that if the government wants to at least start the process, no time can be wasted. Even sweeping changes to the country's outdated Criminal Code that looked like a sure bet last winter are now uncertain to take place. A proposed ČSSD amendment which, among other things, suggested lowering the age, from 15 to 14, at which young offenders can be tried as adults held up the bill before the election. The ODS-dominated Senate eventually blocked it. But whether the amendment has been officially scrapped, or is just awaiting a different audience in a new government, is unclear. Topolánek himself will likely have to scrap many of the reforms he promised voters before the elections, as the ČSSD looks likely to influence any new government. The ODS's proposed 15 percent flat tax, for example, is all but dead. No matter what shape the new government takes, the ČSSD, a party vehemently opposed to a flat tax, will have enough seats to block any such tax reforms from passing. Petr Kašpar contributed to this report. Kristina Alda can be reached at kalda@praguepost.com Other articles in News (23/08/2006):
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