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ISSN 1213-1792


Jan Čulík


Karel Dolejší


Michal Panoch, Jan Panoch

Grafický návrh:

Štěpán Kotrba

ISSN 1213-1792
deník o všem, o čem se v České republice příliš nemluví
26. 6. 2006

Parties search for some post-election consensus

Days before the center-right coalition agreement was to be signed, the parties had still only agreed to disagree on many policy issues, although consensus has been found on value-added tax (VAT) levels and a form of flat tax, the cause celebre of the Civic Democrats (ODS).

Published in Czech Business Weekly HERE

The junior partner Greens appeared satisfied that ODS and the Christian Democrats (KDU-ČSL) would give their ecological and energy agenda a fair hearing.

But ahead of the June 26 signing date, the Greens' push to change the electoral law and form its own parliamentary club was coolly received, and ODS negotiating team member Martin ˘Ríman was labeling party Chairman Martin Bursík a "coalition breaker."

Topping the three parties' agenda were taxation, energy, transport and environmental issues; hanging over their heads was the knowledge that, in a hung Parliament, the viability of the coalition itself was far from certain, with ODS Chairman Mirek Topolánek giving it a "50--50 chance" of success. The center-right coalition has 100 seats in the 200 seat lower house and needs at least one vote from the Social Democrats (ČSSD) or unreformed Communists (KSČM) to win a confidence vote in Parliament. Much will depend on who the lower house will elect chairman and vice chairmen --- in a secret ballot.

As the coalition looked to close the last of six "chapters" in the draft agreement, economic questions proved to be the main stumbling block, with the free-market ODS and ecological Greens locking horns and the KDU-ČSL --- which insiders say is deep in debt --- resigned to the sidelines.

The parties' negotiators agreed on one flat tax for individuals and companies, between 15 and 19 percent, to replace the progressive system that now sets those rates at between 12 and 32 percent for individuals and 24 percent for companies.

The same 15 to 19 percent level would apply to VAT with some "exceptions" on items including food, medicines, accommodation, public transport and biomass fuel, books and cultural events. The changes would be valid from the beginning of 2007. This agreement placed the Czech Greens to the right of their European counterparts.

"The new tax system means higher incomes for entrepreneurs but lower incomes for the state," said Communist MP and financial expert Svatomír Recman. "Of course, while it would be an excellent financial contribution for companies, it would weigh heavily on people hovering on the edge of a living wage," he said, signaling KSČM opposition to the proposal and adding that, "state incomes would be 25 percent lower."

As CBW went to press Friday the coalition parties looked far from agreeing in writing on the public hospital law (although ODS shadow health minister Tomáš Julínek said he has an alternative solution, he did not present one), or the Greens' move to prohibit construction of a new nuclear power station and halt the completion of the Temelín plant in South Bohemia (one of the Greens negotiators is Dana Kuchtová from the anti-Temelín nonprofit group Jihočeské matky) and extension of coal mining limits in North Bohemia. A ban on truck transport on Sundays, another Green proposal, was agreed.

Taxing issues, clubs

While negotiations were a bit theatrical --- secret talks at sometimes secret locations --- the coalition agreement is less dramatic; short on detail and vision, especially about how reforms may proceed.

Nonetheless, the Greens, who entered Parliament for the first time, were very successful during the coalition discussions, winning tough concessions from a desperate ODS. Bursík comes off as the election winner, knowing that the six Green deputies are of vital importance.

Now Bursík wants to change the election law and form his own political club in Parliament. Current rules allow only parties with 10 or more MPs to form a caucus. The ČSSD and Communists don't want the system to change, while the ODS --- which sees the Greens as nontransparent --- are suggesting that it could "lend" the Greens four MPs to create a club. Bursík hasn't been receptive to the idea, which could act as a control mechanism and limit club debate.

"The fact is, that in this case the Greens would be dependent on the ODS, and there would always be the danger that the four [ODS] deputies would come back to their own club and the Greens would lose their club," said political scientist Petr Just.

Observers see Bursík's assertive behavior as a potential impetus for the ODS and ČSSD to agree on cooperation and possibly form a "grand coalition" that could eventually push to scrap the current "d' Hondt" system of proportional representation, which they see as giving smaller parties too much power, to a first-past-the-post majority electoral system.

Meanwhile, the leadership of the new Parliament --- who will be the chairman and however many vice chairmen are voted in --- is of vital importance to all parties in pushing through their agenda.

Considered favorites for the top post are Miroslava Němcová (ODS) and outgoing Prime Minister and ČSSD party chairman Jiří Paroubek, with the KSČM's Vojtěch Filip as a vice chairman in exchange for supporting Němcová as chairwoman, and eventually an ODS government in a vote of confidence (see opinion, page 8). A similar scenario played out when President Vacláv Klaus was elected with the "silent" support of the Communists.

However, there are two things that make this problematic. One, the Communists are disappointed with President Klaus, who hasn't proven grateful to the KSČM; and two, the Communists cooperated with ČSSD on pushing through legislation, such as the Labor Code, and any support to the center-right would be taken as a dirty trick. Furthermore, the Communists must be ready to support a ČSSD government in case Topolánek fails to win successive votes of confidence.

The ODS leader knows very well that the confidence vote will be touch-and-go. He can also try to offer a vice chairmanship to the Communists in exchange for support in a confidence vote --- probably by leaving the chamber when a vote takes place. Topolánek also can make an agreement with ČSSD and try offer the chairmanship to Paroubek in exchange for a "yes" in a confidence vote. There is no formal negotiation about these positions, but the two bigger parties will likely try to "sell" or "buy" deputies in this regard.

Paroubek, though not prime minister, could still be a very important figure --- as chairman, he would be the third who can suggest the person who should try to form a new government. He is rumored to want the current chairman, Lubomír Zaorálek (ČSSD), to fight for the spot again, in which case Zaorálek would in turn suggest Paroubek as a new government negotiator.

Meanwhile, Topolánek has said that if it proves impossible to form a center-right coalition government, he would attempt a minority government, with Paroubek's ČSSD support as a last resort. This possibility is "pure speculation," Topolánek said, although confirming that it was a possibility. The question is what would the Christian Democrats do in case Communists support the coalition government, as KDU-ČSL party Chairman Miroslav Kalousek said last year that his party would never be a member of any government supported by the KSČM.

Typical in the trading of political favors is the appointment of party members to posts in key state and other supervisory boards; spots at the Czech bail-out agency ČKA supervisory board could be the first filled, as ČSSD this spring ousted from its board ODS' Vlastimil Tlustý and Vladimír Doležal.

Irena Ryšánková is a parliament analyst for public broadcaster Česká televize.

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