published: 16.12.2013, 12:46 | updated: 16.12.2013 13:17:22
Prague - The coalition agreement of the nascent Czech centre-left government generally corresponds to the trade union policy, but it does not clearly say how the finances to cover the planned changes would be gained, CMKOS umbrella union leaders told journalists today.
"The coalition agreement moves in a direction that corresponds to the direction of the CMKOS policy," CMKOS deputy chairman Vaclav Picl said.
"This has been the best coalition pact of the last 23 years," Josef Stredula, head of the strongest trade union KOVO, said, referring to the whole post-communist era following the 1989 Velvet Revolution.
But Stredula said a number of issues still needed to be dealt with, such as the energy concept.
The Social Democrats (CSSD), the Christian Democrats (KDU-CSL) and the ANO centrist movement released the programme of their coalition pact on Friday. The three parties will start the talks on the composition of their potential government today.
The union leaders especially welcomed the planned increase in the minimum wage, the abolition of private pension schemes (second pillar of pension system) and more support to families with children.
Picl said the unions praised the effort at food self-sufficiency, pro-growth measures, the idea of social solidarity and the plans related to employment.
"Economic growth is our main priority," he said.
The CMKOS pointed out that the coalition agreement does not clearly set the revenues and expenditures of public budgets, which poses the risk of the state not being able to cover the costs related to all the planned changes because the agreement pledges to keep the budget deficit under 3 percent of gross domestic product (GDP), which is a condition for the euro zone membership.
The revenues are mostly based on savings in state administration, CMKOS said, indicating that the desired savings may not be achieved.
Czech financial analysts also noted that it seems rather unclear where the forming government would find the money to meet its promises when it did not plan to raise taxes.
According to the 50-page coalition agreement, no taxes will change in 2014 and any planned tax changes would be discussed in public. As of 2015, the coalition plans to increase the taxes imposed on gambling introduce a lower VAT rate on books, medicines, diapers and baby food, which would be funded by a special tax on telecoms, utilities and banks. Tax reliefs for people with children and higher pensions are to be introduced as of 2015.
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