Civil servants are likely to bear the burden of government cost-saving measures aimed at reducing the budget deficit. Along with the extensive cancellation of unfilled posts within the civil service, bonuses have been lowered as of 1 January 2010 and significant dismissals are being forecast. Trade unions are opposed to any redundancies or salary cuts, although some deemed the dismissals as inevitable.
Cost-cutting measures in government ministries
Government ministries are being forced to introduce cost-saving measures in 2010, reducing expenditure significantly. As a spokesperson for the Ministry of Agriculture of the Czech Republic (Ministerstvo zemědělství, MZe), Petr Vorlíček, outlined: ‘The total volume of wages and salaries in our ministry must drop by 6%.’ Moreover, the Ministry of Culture (Ministerstvo kultury) is predicting that cost-saving measures will also affect subsidised organisations of the ministry, with budget allowances set to be cut for galleries, museums and theatres. The Ministry of Foreign Affairs of the Czech Republic (Ministerstvo zahraničních věcí ČR, MZV) has already announced the closure of some of the embassies. At the same time, the Ministry for Regional Development of the Czech Republic (Ministerstvo pro místní rozvoj ČR, MMR) is planning to cut subsidies and grants for non-profit organisations.
Cancellation of unfilled jobs
The public service employs about 435,000 people. The government had already introduced some amendments to the working conditions of civil servants in 2009, including a wage freeze. In addition, a total of 13,287 unfilled positions have been cancelled; the ministries continued to receive funds allocated from the state budget for these positions which were usually used for increasing wages in the civil service – however, this is no longer possible since the beginning of 2010. This process is set to continue: for example, in the education sector, more than 6,700 jobs are to be cancelled in this way. In total, according to the Minister of Finance, Eduard Janota, more than 20,000 unfilled job positions will be cancelled, while the volume of funds earmarked for civil service salaries is due to drop inter-annually by CZK 4 billion (about €152 million as at 29 January 2010).
However, even these measures are not deemed sufficient. Due to the worsening budgetary outlook – with the state budget deficit for 2010 set to amount to almost CZK 163 billion (€6.2 billion) – employee dismissals will also have to be implemented. As Minister Janota confirmed: ‘Another reduction of costs for administration and the civil service is being envisaged.’
Dismissals inevitable
According to the trade unions, dismissals related to cost-saving measures within the state budget are most likely to occur in the country’s Customs Administration (Celní správa ČR), the Prison Service (Vězeňská služba ČR, VS ČR), the Judicial Guard (Justiční stráž ČR) and the army. As the Chair of the Trade Union on State Bodies and Organisations (Odborový svaz státních orgánů a organizací), Alena Vondrová, forecast: ‘I presume that, until the end of 2009, up to 4,000 people will have to leave the civil service.’
Meanwhile, a spokesperson for the Customs Administration, Jiří Barták, confirmed: ‘Towards the end of the year, we will reduce the number of jobs by 421 of the total of 6,690, but we still do not know how many of them will be linked to the cancellation of the non-staffed positions only.’
Elsewhere, in the Ministry of Defence (Ministerstvo obrany ČR), nearly 2,000 employees are set to lose their jobs. The job cuts will affect employees of the ministry, along with those of subordinate organisations and the army. As a spokesperson for the ministry, Andrej Čírtek, confirmed: ‘The absolute majority of them will leave by the end of 2009.’
Commentary
On 9 December 2009, the Czech Chamber of Deputies (Poslanecká sněmovna Parlamentu ČR, PS PČR) approved the state budget for 2010, with the left-wing parties proposing additional funds for social services, civil servants’ pay and remuneration for farmers – although the government was against these proposals. The left-wing deputies in the lower house have raised the deficit by more than CZK 12 billion (€457 million) through their changes to the budget – in total, the deficit for public expenditure will amount to 5.7% of gross domestic product (GDP). The Deputy Chair of the liberal Civil Democratic Party (Občanská demokratická strana, ODS), Petr Necas, critisised the outcome of the voting, claiming that the decision was a victory for populism ahead of the May 2010 general election campaign. He warned that the move would pose a long-term threat to the Czech public finances.
Jaroslav Hála, Research Institute for Labour and Social Affairs (RILSA)