Press Conferences

16. 2. 2009 16:06

Press Conference after the Meeting of the Government, Held on Monday 16th February 2009

Jana Bartošová, government spokesperson: Good afternoon, ladies and gentlemen, welcome to the press conference after the meeting of the government. I welcome the Prime Minister Mr. Mirek Topolánek, the Deputy Prime Minister and the Minister of labour and Social Affairs Mr. Petr Nečas and the Minister of Industry and Trade Mr. Martin Říman. Mr. Prime Minister, you have the floor as usual.

Mirek Topolánek, Prime Minister: I must excuse the absence of Minister Kalousek as he left for Brussels and therefore we will not participate in the presentation of the National Anti-Crisis Plan of the Government. As to the points which were debated today, they will be presented by Petr Nečas. The government approved the supportive material for the decision on the implementation of the third stage of the pension reform and I point out that it is still in the phase of a discussion. I have read certain articles which informed on the implementation; nevertheless it is still a long way to go to the implementation. I have brought Mr. Minister Říman and Mr. Minister Petr Nečas with me to try to present some points of the National Anti-Crisis Plan, in spite of the fact that we do not want to explain it in a detailed way.

Before this, let me read the draft of the resolution which concerns payments of regulatory fees in regions, which was an item that was debated today beyond the agenda of the meeting. The government assigned the Minister of Interior with a task to begin urgent negotiations with the representatives of the individual regions of the Czech Republic in connection with payment of regulatory fees in accordance of the Act no. 261/2007 Coll. and in connection with the Act no. 48/1997 on resolution, decisions or other measures of regional organs in connection with this Act. The government assigned the Ministry of Finance with a task to analyse legal consequences of those resolutions or other measures of regional organs which apparently and seriously breached the law within the point I/1 and in relation to the legislation on the gift tax, and to submit to the government information on consequences on suspension of provision of non-mandatory financial means which represented revenues of the individual regions. These were marginal notes on the meeting of the government.

As you know, a session of the economic ministers with the National Economic Council of the Government (NERV) and with the EU presidency section of Mr. Deputy Prime Minister Vondra was held yesterday. We debated great number of measures which were presented by the NERV and at the tripartite session today. Some points were added. I will try to inform you briefly, as I am of the opinion that deputies deserves to be given direct information on Wednesday. That is why deputies and senators will be provided complete information in a material which you cannot have at your disposal at the moment and I hope you will not have it at your disposal by the time it is published. Therefore I deem all those materials you have at your disposal as drafts as the particular material will be submitted to the Chamber of Deputies.

The principal tasks which we assigned in our efforts to eliminate impact of the economic recession, those tasks were to maintain employment or to reduce the growth of unemployment, and to maintain the stability of public finances. After those corrections we made, those figures that you know – I mean 2,9% GDP, are not true, as they will be higher. The public budgets will be negatively affected by the amount of 1,9% GDP. I would like to refute a very popular myth which was disseminated in media and on our political scene – they claimed that we were behind the time and did not take certain measures in time. I should say that half of those measures, and also from the financial point of view, have been implemented since September of the last year. I and the government refuse such speculations in this respect. There are about 15 points in the material; you cannot find there matters of rather systemic or long-term character which were connected with the economic decline. Therefore there are few points which you might expected because they had no connection with direct solution of that crisis; they were included in the programme declaration of the government or in other materials.

It also applies to the solution of the economic recession impacts on the health insurance. In a week we will present quite separable solution of the health insurance problems and the drop of insurance collection that is expected. It is not a measure which would be related to the crisis itself. It is necessary to take it so as to solve those impacts, those drops in insurance collection as a whole.

The first measure that you were informed of, and Petr Nečas can explain it, concerns the reduction of social security payments. We expect that this measure will enable to maintain employment just in case of employees with low incomes. It is markedly regressive measure and it will have a positive impact on low-income groups.

The second measure consists in shortened depreciation period of property on the revenue side of the budget. According to the final decision, depreciation period in the first group will be shortened from three years to one year, which means that no depreciations will be applied in fact. In the second depreciation group depreciations period will be shortened from five to two years, which will increase financial means of entrepreneurs by about 9 billion crowns. We expect that this measure will be fiscally neutral in a long-term time horizon.

The Chamber of Deputies is to vote on the VAT-free purchase of cars; it concerns rather a revocation of a saving clause and setting of normal state. The expected impact will be about 3 billion crowns. I forgot to say that the expected decline in first measure would be about 18 billion crowns. Nevertheless, we suppose that it will be compensated by economies resulting from higher employment rate and lower unemployment benefits. We expect that we could save 50000-70000 of low-income employees.

The fourth measure consists in reduction of the social insurance rate by 1,5%. It came into effect as of 1st January and about 18 billion crowns would be left proportionally to all employees who paid the social insurance.

The fifth measure which also came to effect from January consisted in reduction of the corporate tax; I mean the income tax of legal entities.

The sixth measure means the reduction of railway fees. Those fees were reduced by 20%. The seventh measure concerns regional traffic and ensuring its proper performance. In total 2 billion crowns will be spent in the most affected regions.

Further measure consists in guarantees and support of credits, which has been announced by the Czech-Moravian Guarantee and Development Bank; this measure is aimed at small and medium-size enterprises. The increase of financial means for the bank at the amount of 1, billion crowns in this year and by 2,7 billion crowns in the next year means guarantees of credits amounted to 40 billion crowns. The guarantee will be increased up to 80% with the maximum drawing of 90 million per one addressee. It is a revolving project which means that its effect consists in the second figure; it means in the direct burden of the state budget but in the impact of those 40 billion crowns.

The ninth measure concerns reduction of the energy intensity of buildings. We expect to implement the entire Housing Programme - replacement of non-environmentally friendly heating, introduction of thermal pumps, measures concerning waste management. We also expect the support of the Panel Programme which has also a multiplication effect as it multiplies the private capital.

The tenth measure concerns the support of exports and it comprises series of changes in the Czech Export Bank and the Export Guarantee and Insurance Corporation (Egap). It will enable to increase the amount of export projects by 35 billion crowns at the moment.

The eleventh measure consists in the support of entrepreneurs in the agricultural sphere and concerns the Supporting and Guarantee Agrarian and Forestry Fund. It is also a multiplicator and at the moment it concerns the support amounted to 2,3 billion crowns; thus credits for small and medium-sized entrepreneurs in the agricultural sphere will be increased.

The twelfth measure concerns investments to the research and development. The approved amount for 2009, including financial means of the European Union, amounts to 32,4 billion crowns which is unprecedented amount within the of the Czech Republic.

The thirteenth measure concerns the investment to the transport infrastructure which we must include in those measures together with funds of the State Fund of Transport Infrastructure that were not drawn in the last year and that amount to 7,2 billion crowns. We transferred them to this year and thus the State Fund of Transport Infrastructure will have financial means amounted to 90,3 billion crowns at its disposal. It is a double of means which were provided in those years of prosperity of previous governments.

The fourteenth measure concerns strengthening of further expenditure areas, for example the Programme of Rural Reconstruction by 272,2 million crowns (direct payments will be about 1 billion crowns). At today's meeting of the government it was added one more point which was more advantageous for entrepreneurs than the original proposal which had been aimed at return of taxes for 2007. This measure is more comfortable and may help all entrepreneurs as all the freelancers and entrepreneurs with less than 5 employees will not have to pay tax prepayments. It concerns in total 250000 entrepreneurial subjects. The payment paid by us is rather a virtual one as those subjects would not probably pay tax in this year; nevertheless, the aid may be about 22 billion crowns. Now I would like to conclude my presentation of those measures.

Of course, we will submit to the Chamber of Deputies the entire analytic part and detail bases which are much more comprehensible and concern the individual measures. I should say that fears that we missed the bus were vain. I refuse fears that the government did not want to solve the problem. If we compare our measures with some other countries, for example Germany, our anti-crisis plan is even broader if we take number of inhabitants or the GDP into consideration. Nevertheless, what I regard more important is the fact that majority of those measures are systemic measures and nation-wide measures. They are not isolated and populist steps. They could ensure the principal thing – it is employment maintenance.

Now I am looking to my notes – I have skipped the point no. 16. It concerns a great package of insolvency proposals for solution of the situation of firms which are facing moratorium or bankruptcy. The measure should ensure more security for employees from the point of view of incomes and their ensuring.

After this point, we also approved a measure which was aimed at solving problems of firms which face lowering demand for their products and which would have to dismiss employees or to send them to holiday with 60% wages. Such firms will have a possibility to get 80% not only of wages but also social and public health care insurance payments for employee who will have accelerated or a special regime of work. Thus, they will get a chance to maintain their employees even in time of lowering demand. I must have forgotten something; you will be informed on details on Wednesday in the framework of our presentation at the Chamber of Deputies and at the press conference which will be held on this issue.

Jana Bartošová, government spokesperson: Thank you and now I give the floor to the Deputy Prime Minister Mr. Petr Nečas.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: Good afternoon. I would like to specify the second point. Using the financial means from the European Social Fund and the priority no. 1 – operational programme Human Resource and Employment we want to aim means, which would enable employers that do not have jobs for their employees to organize educational and training activities, at increasing their skills and knowledge. In case of absence of that measure, such employees would have to be either dismissed or they would have to stay at home and get only 60% wage. We will refund them up to 80% of wages, including payments to the social and public health care insurance up to the triple of the minimal wage. It will enable employers to flexibly respond to fluctuation of the demand for their goods and to organize, for example in a week period, those trainings. It would be a way which would enable employers to maintain their employees to a certain degree and in addition to increase the value of labour force.

Apart from this material, the government debated the material which deepened measures of the government in the sphere of pension reform; I mean the possibility of so called opt-out – the transfer of certain percentage of the PAYG (pay as you go) pension system to the fund pension system. The government assigned the Minister of Labour and Social Affairs and the Minister of Finance with a task to submit a detailed subject-matter of the law by July of this year so that a political discussion might be led about it. I would like to emphasize that this step is a step by means of which the government meets its Programme Declaration as the government promised to consider the possibility to introduce the second pillar of the pension system. I would also like to point out that the proposal which we submitted is based on voluntary possibility of the opt-out; it means that we do not want the fund system to be obligatory. It will be a possibility to transfer up to 4% out of 28% of amount that are paid by employers and employees to the social insurance. Employees who will choose this opt-out will have to add their own 2% in addition. It means that two crowns of employees will be added to those four crowns which will be transferred from the PAYG pension system.

There are two basic reasons for that. First it is a feedback element which is to lead employees to consideration of this step. The second reason is that there will be more revenue sources in the entire pension system, which will be composed of three pillars, as people will deposit their own means. Part of this step is a principle according to which employees, who will use the opt-out and who will reduce their incomes and payments to the PAYG pension system, will have reduced their claims related to the PAYG pension system. Their pensions or proportional part of their pensions will be lower. As you know the PAYG pension system consist of two parts – the basic part, which is the same for all beneficiaries, and the proportional part which will be reduced by one third in case of use the opt-out.

It means that the system, on a voluntary basis, will enable those people, who do not want to pay their money only to the PAYG pension system and who do not want to rely only on that system, to invest their money into the fund system. Those state pension systems are sometime something like pyramidal schemes. In other words, those who will start later, will pay for it more. I would like to point out that the fund system does not mean saving for 5 or 10 years; it means saving for 30 or 40 years.

Jana Bartošová, government spokesperson: I thank the Deputy Prime Minister and now the Minister of Industry and Trade has the floor.

Martin Říman, Minister of Industry and Trade: Good afternoon, I would like to specify two points of that anti-crisis plan which are closely related and apart from the reduction of social payments are perhaps the most important for entrepreneurs. I mean the shortening of depreciation and abolishment of their duty to pay income tax prepayments in case of traders and entrepreneurs with maximally five employees. As to depreciations it is markedly pro-demand measure. It will not be in force for ages, just for two years until 30th June of the next year. It means that entrepreneurs will be motivated to purchase property and investments now in combination with abolishment of those income tax prepayments. Thus a very advantageous combination is created. In comparison with other possible measures which were considered, it is a measure that is possible to implement executively; there is not necessary to amend any law. It concerns income tax prepayments started from the first quarter of the year. It is an urgent measure which will maintain the cash-flow in firms as the amount of 22 billion crowns, by which the state budget will be reduced on the revenue side, represents real money which entrepreneurs would have to pay but they will not have to pay it. They will be able to purchase property and to use those shortening depreciations.

Mirek Topolánek, Prime Minister: I have forgotten to mention a measure which looks like an unimportant one. Following the request of entrepreneurs the shortening of the VAT return period was introduced. It is a measure that is connected with our efforts to retain employees in firms and to enable entrepreneurs to invest their money in this period.

Jana Bartošová, government spokesperson: Thank you and now your questions, please.

Mediafax: I would like to ask what the role of the National Economic Council of the Government (NERV) is like at the moment.

Mirek Topolánek, Prime Minister: It is exactly like it was described at the last press conference. I was speaking about three roles of the NERV. First, it concerns speedy help in the preparation of the National Anti-Crisis Plan of the Government, second – help in the course of the Czech presidency and in particular before the March EU Council summit which will concern, apart from energy industry also economy and the implementation of the European economic reconstruction plan. The third role is closely connected with our role in the framework of G20 session, preparation of the Czech position or the European position in the framework of the G20 summit that is to be held in London on 1st and 2nd March. The NERV continues its activities.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: I would like to add information on the National Economic Council of the Government in such a respect that it also represents more detailed expert background for the economic decisions of the government as each member of the National Economic Council of the Government cooperates with many other economists. It enable to get a more graphic view of the current economic situation and proposals for solution than it would be in case of solely executive organs, ministries and state administration bodies. We regard it as very precious and inspiring tool on which the government will rely also in the future. It does not have connection only with the National Anti-Crisis Plan of the Government; it concerns far broader cooperation.

Jana Bartošová, government spokesperson: Thank you, the Czech TV.

Czech TV: I would like to ask when those measures, which you agreed on today, will begin to bring their effects. Mr. Minister Říman has already informed us of some of them; could you say something about the other measures?

Mirek Topolánek, Prime Minister: Those measures have already been bringing their effect. I mean those measures, the implementation of which started from 1st January; they are measures which means expenditures amounted to 32 billion crowns. These measures are already bringing their effect. Those executive measures, which form an overwhelming majority, will be implemented immediately. For example in the framework of those plans for organization of trainings, some of them will be started at once and in March a new programme will be introduced; it means within two or three weeks. The legislative measures that concern the Act on Insolvency are likely to be passed by the Parliament. I do not expect any problems there unless somebody has a tendency to amend it in a creative way. It also applies to the Act on Social Insurance. I regard this law as very important as well as the Act on Income Tax which is related to the accelerated depreciations. I do not expect any problems there. The biggest problem poses the proposals that were submitted to the Chamber of Deputies and which mean expenditures amounted to 80 billion crowns in case of the consumption tax. They would absolutely unnecessarily decrease the consumption tax in the situation when prices of oil and petrol are lowest if we take last years into consideration. These are measures of Bohuslav Sobotka and Vlastimil Tlustý aimed at the VAT; these measures are absolutely nonsensical. I claim that if they are adopted, there will not be financial means for any other measures. Most of those measures which were taken are of an executive character and they are being implementing immediately. In case of those legislative measures, I suppose that they will be approved at the March session of the Chamber of Deputies in an accelerated procedure as they concerns small amendments with great impacts. It will be necessary to negotiate with the opposition or to win necessary number of votes so that they could be quickly implemented.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: I would like to add information – the reduction of the social insurance payments is proposed in such a way that the system carry-back will be used; it means that it will be applicable to the entire year 2009. There will be used the retroactive principle. Even in case of coming into force as of May, the accounting period would be from 1st January 2009.

Mirek Topolánek, Prime Minister: There are no problems in case of depreciations and the social insurance. These measures are in force throughout the year or there is retroactive principle used. In case of insolvency measures, which will be adopted quickly as I hope, we could solve the situation through a moratorium.

Jana Bartošová, government spokesperson: Thank you, further question, please.

Reuters: Mr. Prime Minister has already spoken about it; nevertheless, can you confirm that these measure that are now proposed mean 1,1% GDP or 40 billion crowns?

Mirek Topolánek, Prime Minister: These measures, about which we are talking in the framework of the anti-crisis plan, mean 1,9% GDP plus 22 billion crowns. It means that I refuse to divide those measures to those which will be implemented and those which have already been implementing; they form part of a single plan and it means 1,9% GDP plus 22 billion crowns.

Reuters: And how about those old measures amounted to 30 billion crowns?

Mirek Topolánek, Prime Minister: There are any old measures here; only those that came into force on 1st January of this year.

Reuters: Were these measures prepared with the vision of such a crisis?

Mirek Topolánek, Prime Minister: Yes, of course. We have been taking measures related to the economic decline since September of the last year. The economic decline was monitoring and great number of those measures was taken with knowledge that the economic growth would be markedly lower that in past years. Those measures are connected with the anti-crisis plan and in this respect we comprise them in it correctly.

Martin Říman, Minister of Industry and Trade: For example those pro-export measures were presented at the Office of the Government together with Minister Kalousek at the end of November. At that time the economic impacts had not been expected. Now as regards to impacts – it is not possible to just add those billions together because those two measures, about which I was talking, which concern depreciations and income tax prepayments are quite neutral from the budgetary point of view in a long time horizon. If investments are depreciated now, they will not be depreciated in the following years. It is neutral from the point of view of the state budget. It is much more complicated and it is not possible to just add it together.

Mirek Topolánek, Prime Minister: Nevertheless, I would like to highlight the information that I gave in the introduction. We are debating something which is not a published material at the moment. I refer you to the press conference on this material that will be held on Wednesday. I refuse to give you any further information on it.

Jana Bartošová, government spokesperson: Thank you, Hospodářské noviny.

Hospodářské noviny: Mr. Prime Minister, you said in a Slovak TV broadcasting that you conditioned a little bit the future existence of your government with the approval of that package of measures. What does it mean?

Mirek Topolánek, Prime Minister: A little bit means a little bit, not quite.

Hospodářské noviny: Are you going to joint the vote of confidence with the vote of that package?

Mirek Topolánek, Prime Minister: I am not responsible for the crisis. I hope you do not expect me to do so. I regard those measures to be positively adequate to the situation. We expect in our scenario the decline by 1% in spite of the fact that current prediction are 0 – 0,3% We regard those measures as adequate to the situation or to the expected situation. I think that there is much greater risk here which is connected with possible adoption of measures that concern the VAT and the consumption tax. If they are adopted, then – let somebody else do it because nothing could be implemented.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: Simple calculation shows that the adoption of those proposals which concern the VAT and the consumption tax would pose far more risks that if we will be in red from the point of view of GDP. In other words, those measures would be greater threats for public finances that the decline of the GDP.

Jana Bartošová, government spokesperson: Thank you, further question, the Czech TV.

Czech TV: Mr. Prime Minister, you mentioned in the introduction the resolution and a task for the Minister of Finance and the Minister of Interior which concerned regions and health care fees. What the impact of this task on regions will be like? What will be the next steps like? What does it mean for regions?

Mirek Topolánek, Prime Minister: With regard to the fact that the first point is to start negotiation with regions, it would be good if they will be informed first.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: Nevertheless, I would like to add that it is true that regions as organs of public administration are public corporations and unlike private corporations, which can do everything what is not forbidden, these public corporations may do only what is expressively allowed in our laws. This is a principle of our Constitution. From this point of view, the government as the supreme executive organ will approach those negotiations.

Jana Bartošová, government spokesperson: Thank you, Daniel Takáč, Czech TV.

Czech TV: Good afternoon, Mr. Prime Minister I would like to know whether the vote at the Chamber of Deputies will be on the individual parts of the plan or whether it will be on the entire package. It is important for the Social Democratic Party which claims that it would be a problem for them to vote on the entire package; however in case of votes on the individual parts there will be no problem with it. That was the first question. The second question – excuse me, but I really do not understand what you mean under the term "a little bit". You either may combine the vote of confidence with that vote or not. So, the question is clear – will you combine the vote of confidence with that vote or not?

Mirek Topolánek, Prime Minister: I will leave it to your mysterious speculations. I will not answer it as I still do not know how we will submit those laws or those amendments. I suppose we will submit them in a single package. It is quite simple; those amendments concern just simple changes and have a short term character. It is not a great package; its volume is about 300 pages and in case of the Insolvency Act there will be just a few pages. I do not think that we should vote on them individually because disapproval with some of those measures and approval with the consumption tax would form a concept which could not be implemented. I am of the opinion that the value of that package is in its comprehensiveness because the individual measures are aimed at the relevant groups, whether they are employees or small enterprises of big corporations with pro-export needs. It means that lifting any measure out of the entire context, for example the infrastructural projects, is not possible. I have forgotten to mention those infrastructural projects. We agreed on the preparation of faster renewal of vehicles in the public transport and logistic centres. By the way, it is also connected with the Programme Declaration of the Government. We are trying to set such mechanisms in the framework of structural funds so as we would be able to concentrate that fund drawing, which is even now unprecedented, to this year. Therefore I do not think that it is possible to lift any measure out of the context. In this respect I expect the vote on the entire package and we will debate it at the meeting of the government. I would like to know what would be adopted from that package as the opposition criticized it even before it had information on it. That a priori refusal is rather derisory. Only now when they have an opportunity to study it may understand that those measures are mutually interlinked and I cannot see any good reason for separate votes. In case the approach of the opposition is a priori negative it might a problem; nevertheless, I do not think that such an approach is common in Europe and in the world. I have information from various countries and everywhere political parties call for national unity in this situation; they are trying to find a way how to implement measures as quickly as possible. I do not think whether the Social Democratic Party will act in accordance with slogan "the worse the better". In such a case no measures would be approved, and if they are approved, then they would be aimed at different direction. I could hardly be liable for that.

Jana Bartošová, government spokesperson: Thank you, Czech Radio.

Czech Radio: I have just an additional question that concerns those programmes of employment maintenance. Will be that 80% wage refund, which is paid out at the amount of 60% to people who are out of work, only in case of trainings organized by firms?

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: I will specify it. I may have said it imprecisely; it is not 80% refund of 60% salary. It is an 80% refund of salary. In other words, it will be more advantageous for employees if an employer organizes that training as they would get higher refund then in case of an employee would be at home because of partial unemployment; I mean if the procedure would follow the Article 209 of the Labour Code. It will be up to 80% of wage, maximally triple of the minimum wage, including payments to the social insurance and public health insurance. A small part, about 10%-15% will be covered by employers so that there would be certain cost sharing.

Mirek Topolánek, Prime Minister: It has several synergic effects. One of them is employment maintenance in the situation of reduced demand. Second effect consists in acquiring skills; it will not be regarded as a formal matter. Third, it is employment maintenance in training centres which will provide such trainings. There are several effects there.

Jana Bartošová, government spokesperson: Thank you, Czech TV, E15 and Mladá fronta.

Czech TV: Mr. Prime Minister, I have one more question concerning the solution of the crisis in the European Union - the financial and world crisis. Will you be negotiating, in the framework of some measures, also with the organization Union of European Employers? They are rather complaining that they are trying to contact you but without success, so far. They prepared some proposals for fighting against crisis. Are you planning any meeting with them?

Mirek Topolánek, Prime Minister: I have already met representatives of trade union and therefore I cannot see any reason why to refuse a meeting with employers. Nobody addressed me; they must have been trying it in a wrong way. Just for the sake of order, in the nearest future we have four sessions in fact; one will be held in Berlin on Monday; it will be the session of G5 – the most powerful EU members of G20 and the Czech presidency as a representative of 27 EU countries. We will meet for the first time after some time. The next Sunday we will meet in Brussels at the informal session of heads of states where we should be debating the preparation of the G20 summit. It will be certain balancing of the European approach even before the session of the EU Council in March. It will be a debate of those who call for further packages and protectionism with those who are in fears of such measures. We will be trying to exchange our experience of implementation of that European Reconstruction plan. Then the March summit will be held and it will be very important as it should anchor those issues in the binding final resolution. Then it will be G20 Summit held where we the global financial architecture is to be debated as well as tools in the framework of the global solution, not only the European one. The space for the discussion is large. I would like to say that we represent the EU Council, not employers. So, we are a guard of rules. I had a meeting with the European Commission last week and they very appreciated that we are a country is trying to ensure the position of the European Union in the time when certain countries begin to play their own game.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: I would just like to add that we negotiated with representatives of BusinessEurope and the European Association of Crafts, Small and Medium-Sized Enterprises in the framework of a special meeting of the Czech presidency with our social partners in January. We also expect that the European Tripartite Summit will be held on the highest level; it means in the presence of the Czech Prime Minister in the course of tour presidency. And we are prepared to negotiate on the bilateral level both with Business Europe and with the Union of European Small and Medium-Size Enterprises as well as we negotiated with representatives of the European Trade Union Congress.

Mirek Topolánek, Prime Minister: We are even ready to meet them. Now you can see what my life is like – I am meeting them today at 15:30; now I have remembered that meeting.

Radiožurnál: I have a question which concerns different issue. What was the stand of the government like to the senatorial proposal to include the Good Friday among other state holidays? Thank you.

Mirek Topolánek, Prime Minister: Following more animated discussion than it was in case of the anti-crisis plan, here you can see that Parkinson's Laws are in force, our stand is neutral. On the one hand it is a shame that our country does not have such a holiday. On the other hand it has some useless holidays; nevertheless, with regard to the fact that we do not expect reaching an agreement in the Parliament on an exchange of that holiday for some other one which would be abolished, those impacts would amount to 5 billion crowns. There exist a group in the cabinet, and I belong to this group, which would like the Good Friday to become a state holiday. But another holiday would have to be abolished.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: Prevailing position of the government is that it is a mark of certain barbarism of our country is the fact that the Good Friday is a working day. Nevertheless, impacts on the GDP in case of introduction of further holiday would amount to 0,4 GDP together with impacts on the revenue side of public finances amounted to some 5 billion crowns. In other words, it would not be for free and an introduction of further holiday would have those impacts. I dare to say that most of members of the government would welcome the introduction of this holiday on condition of abolition of another holiday.

Mirek Topolánek, Prime Minister: We will leave it to the Chamber of Deputies; it will be a great fun. Come to the session.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: We leave to your fertile fantasy those estimates concerning who advocated abolition of the individual holidays.

Jana Bartošová, government spokesperson: Thank you, E15.

E15: Mr. Prime Minister I really do not know what you will submit to the Chamber of Deputies on Wednesday. Will it be a single material which will comprise the respective amendment including the Insolvency Act?

Mirek Topolánek, Prime Minister: I will repeat it especially for you. The legislative proposal must be considered by the government and it will be submitted to the March session of the Chamber of Deputies. The government will decide whether it will be submitted separately or not. We will submit an integral package of the anti-crisis plan to the Chamber of Deputies; the plan contains both temporary and long-term measures as well as legislative and executive measures. The presented here the essence of the proposal. At the Chamber of Deputies the plan will be presented by two institutions, at least – by the Ministry of Finance and by the Czech National Bank which will describe risks and situation that might occur from the point of view of number of areas including the financial sector. The material will not contain measures that are implemented by the Czech National Bank. It will not include certain measures of the government which are implemented independently on this material.

Jana Bartošová, government spokesperson: Thank you, Mladá Fronta.

Mladá Fronta: Mr. Prime Minister, do you expect any official appeal to the Social Democratic Party or do you rely on the individual deputies of that party who could help you to approve that package? And the second question – they have their own package of measures; is there among those measures anything what you could help them to push through?

Mirek Topolánek, Prime Minister: A part of that discussion within the NERV was also those 52 items of the Social democratic party, one third of which were steps that are already being implemented or which are not against that proposal. About one third formed proclamations that were not possible to implement or measures that concerned the Czech National Bank and one third were measures that would be rather in compliance with a government programme of a left-wing government. We have already made such an appeal through the NERV as two members of the NERV are former ministers of the Social Democratic cabinets; I mean Jiří Rusnok and Martin Jahn are members of the Social Democratic Party. This party, as it is standard, did not use the opportunity to addanother members to the NERV. I think I am making that appeal through that statement of mine and it is not necessary to do any special gestures. It is true that we are willing to talk about the energy industry in the framework of the Pačes´s commission about health care sphere at the round table, for example. I have a feeling that those appeals are ignored by the opposition party and I would be very glad if they will negotiate with us those matters and help us to push them through as it is our common interest.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: I think that there are two possible political approaches of the opposition here. The opposition may express its disapproval with the proposals of the government, and I would understand that approach. Or it may block the anti-crisis measure of the government. I think that a constructive opposition can express its disapproval by another way and it need not block anti-crisis measures of the government and put a spoke in its wheel.

Mirek Topolánek, Prime Minister: I can give you an example. I certainly will not agree with the populist proposal for reduction of the VAT for electric energy as it would lead only to the consumption increase. It would be a step in the opposite direction to those measures than we proposed and which lead to energy economies, whether I mean thermal insulation or a different energy production. The fact that the government will, through appropriate tool, will influence both the oligopoly ČEZ (electric energy producer) and monopoly RWE Transgas (gas distributor) is another issue as the government has not direct tools to do that. It can negotiate. The entire anti-crisis plan of the government is socially directed; we did not say it explicitly but no social allowances, no welfare benefit or programme is endangered. It means that those groups that would face problems have standard of living guaranteed as in times of conjuncture. Our measures are socially balanced and all of them should be aimed at stimulating higher employment rate that it is necessary in the present state of our economy. Thus we reduce expenditures for social benefits and unemployment benefits which will increase as a consequence of the unemployment rate increase. I should say that if we managed to implement in 2003 or 2004 the same measures in the pension reform as they implemented in the last year, then positive effects of those parametrical changes would enable us to breathe freely. But in the present situation, and we calculated 1,4% growth of GDP, a ten-billion deficit of the pension system threatens. It means that I cannot support any measures that lead to deepening of that problem; unfortunately, most of those measure proposed by the Social Democratic Party is aimed at this direction.

Jana Bartošová, government spokesperson: Thank you, I would like to ask whether the report of the BIS (intelligence service) on the Savoy case was on the agenda of the meeting. When will you publish its content?

Mirek Topolánek, Prime Minister: First, it was not on the agenda. Second, we will not publish its content as the report will be debated in the regime "restricted". I do not know why you are so interested in it.

Jana Bartošová, government spokesperson: Thank you, further question please.

Právo: I would like to revert to those fees and regions. You mentioned Mr. Prime Minister, that you may not pay non-mandatory contributions. Could you add some information and explain it a bit, please?

Mirek Topolánek, Prime Minister: I did not say anything like that. I will read it once more for you. We assign the Minister of Finance a task to submit to the government information on consequences of suspension of allocation of mandatory financial means to the revenue side of regional budgets. There are several conditional moods there.

Jana Bartošová, government spokesperson: Thank you, Czech TV.

Czech TV: I have one more question. You presented those anti-crisis measures. When do you they show positive effect upon the Czech economy, what do you think?

Mirek Topolánek, Prime Minister: I am answering that question for the second time. Those measures that we implemented at the end of the last year, for example those concerning the Czech Export Bank, the Export Guarantee and Insurance Corporation, financial means for the Czech-Moravian Guarantee and Development Bank and reduction of social insurance – these measures began to show their effects immediately. The executive measures which we propose will show their effects immediately after their approval of the government, after their gradual implementation. The legislative measures, their number is much lower, will show their effect once the Parliament approves them.

Czech TV: I meant when they will have a positive effect on economic figures.

Mirek Topolánek, Prime Minister: I must disappoint you; it does not depend on the government and you must know it.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: And it does not depend on the Czech government, at all. All of us know that the current economic problems are a consequence of the demand decline. In other words, that crisis is of an exogenous character.

Mirek Topolánek, Prime Minister: It is a question rather to the President Obama, I think.

Jana Bartošová, government spokesperson: Thank you, further question, please.

Deník: I have a question to Mr. Minister Nečas; the question concerns the opt-out implementation. In January the government suspended the debated on this issue as there was a request of the Christian Democratic Party to make a detailed analysis of impacts of the opt-out. Is that problem already solved? Does such an analysis exist? What is its content like?

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: We agreed in the framework of the coalition that we would submit a detailed intention which would be a result of that analysis. The measures would be accompanied by changes of the PAYG pension system which will be aimed at a support of families with children.

Mirek Topolánek, Prime Minister: I cannot refrain from commenting it. Do you really think that a government can solve the economic crisis? You must be kidding. Those measures of the individual governments are aimed at elimination of unemployment and at elimination of impacts of the crisis. It is a financial crisis, it is a crisis of trust and the problem is to unblock credits and to start new investments so that economies of United States of America and China would be recovered; it is not within the power of the Czech government.

Martin Říman, Minister of Industry and Trade: We do not know how many entrepreneurs would go bankrupt if we did not introduce that relief concerning the income tax pre-payments. We suppose that their number will be much lower if they have that relief. We have no possibility to make an experiment in a real economy and to find out how many of them would go bankrupt without those measures and how many of them would go bankrupt without them.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: We have only expert opinions and thus we suppose that based in the reduction of the social insurance we will maintain up to 50-70 thousand jobs in our economy through the improved cash-flow of entrepreneurs.

Jana Bartošová, government spokesperson: Thank you, further question.

Týden: I have two questions. First one concerns the opt-out; you said it would be for 30-40 years. Will you be somehow limiting the age for entering the system, because if you enter the system five years before retirement, there is great risk of short-term oscillation of the market. The second question is aimed at thermal insulation of houses and panel houses.

Mirek Topolánek, Prime Minister: The Panel Programme is running according to the schedule. It is a programme which has firm rules. We expect to transfer to it revenues of the sale of emission vouchers; there are firm rules there. If you ask me whether money allocated by officers of allocated in a optimum way, I reply no, they are not. But I do not know a different system of allocation of public financial means.

Petr Nečas, Deputy Prime Minister and Minister of Labour and Social Affairs: I will add that one of alternatives is to limit the age before retirement to 10 years; part of this measure should be a launch of an information campaign including a possibility to use an Internet calculator which would inform the relevant clients that to make such a step five or ten years before retirement age is a nonsense, and even in case of no oscillation s on the market, because opt-out of part of means would result in reduction of the adequate potion of the pension.

Mirek Topolánek, Prime Minister: I would like to add general information concerning that matter. We debated yesterday this issue and we debated it in the framework of the NERV session. In particular Tomáš Sedláček has prepared entire series of measures of an anti-corruption character as we are aware of the fact that in case of the existing volume of allocation of public money there is certain corruption rate and certain loss-making, and we do not want them to be higher. A great number of measures do not seem to me as if they are a part of the anti-crisis plan because we will implement them in a standard way. They concern the issue which you indicated – that it is not possible to relax those rules as it is common in great number of European countries.

Jana Bartošová, government spokesperson: If there are no further question, thank you for your attention. I would like to draw your attention to Wednesday when the National Anti-Crisis Plan will be presented. Good-bye

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