The CMKOS Demands Concerning Solving of the Consequences of the Economic Crisis
The CMKOS appeals to the Government to immediately address the consequences of the global economic crisis. We are concerned by the fact that the Government - regardless our timely warnings that the global economic crisis will have very strong impacts on the Czech economy - refused to see the danger of slowing down of the economic growth and of now totally apparent decline of the economy and losses of jobs of tens of thousands of employees. Thus the valuable time for preparing for the crisis and elaboration of corresponding economic policy measures was lost.
In our view the Governmental measures should focus on:
1. Preventing further deepening of the crisis. This in our view needs to stop the overall reduction of taxes and insurance contributions - especially of direct taxes and contributions -which takes away the means for educational as well as social systems and also for public investments. The reduction of the profit tax at the same time supports the outflow of profits abroad (up to 5 per cent of the GDP). We are on principle against taking the insurance contributions out of the pay as you go system of pension insurance and put them to the system of capital savings. We demand stopping of privatisation in the sphere of state property, social transfers and public services.
2. Coordination of economic and monetary policy, as the present measures of the central bank aimed at reduction of interest rates are inefficient. Although the central bank reduces the basic interest rates commercial banks on the contrary increase them and reduce the credit framework of companies. We ask the Government to submit - in coordination with the central bank - measures aimed at restoring the credits for the companies and at reduction of their interest burden.
3. Significant expanding of economic diplomacy and thus the real Governmental support of Czech exporters, especially to the markets suffering less from the crisis. To do so needs especially preparation of resources for providing Governmental credits for selected important export activities of Czech companies (the Czech Government should provide credit to foreign companies thus enabling them to implement large projects with Czech exporters.
4. Accelerated increase of public investments to infrastructure (including the infrastructure of cities and communities) and support of green and smart investments. It concerns not only an increase of public investments into transport and water supply and distribution infrastructure and into public support of construction, but also strong expansion of reconstruction of flats, including improvement of their energy efficiency. The acceleration of amortization of new investments, especially of investments to research and innovation. Focusing of the system of investment incentives exclusively to smart investments into innovation, sophisticated production and services. Development of especially technical disciplines at all levels of schools.
5. Accelerated development of the programme of construction during two years of at least 50 thousand flats with the state support, with low rents - for young families and pensioners who cannot find decent housing at suitable costs. It is an investment which could stabilize the housing market. To support and strengthen programmes for thermal insulation of houses
6. Establishment of a fund for wage compensation for employees who as a consequence of the crisis cannot work full-time. The people working only a part of working week should get compensation from the state means. For instance, if they work only three days, the other two days they would get 80 per cent of wage and the state should pay two thirds of this sum.
7. Increase of unemployment benefits and prolongation of the period of drawing them. Our economy gets into a long-term crisis and thus the state is to assure decent conditions for life of people even if they are unemployed for a long time.
8. Protection of agency workers and fix term workers. To ensure the access of these employees to retraining programmes and provide them with corresponding social security including unemployment benefits. To provide foreign workers with a possibility to return home, if they wish so.
9. Protection from financial speculators. To adopt, as quickly as possible, necessary measures unambiguously defining usury and preventing financial speculators from parasitizing on difficult situation of employees by offering them loans with excessive interest which then lead to unmanageable debts of households and often end by personal bankruptcy or seizure. To adapt legal regulations in the sphere of protection of employees' rights in case of insolvency of their employer.
10. Earmarking this year at least two per cent of the GDP for solving the consequences of the crisis and for the support of economic growth. We believe priority should be given to the economic growth and not to the narrowly understood
11. Consulting and agreeing of anti-crisis measures of the Government with social partners in the tripartite Council of Economic and Social Agreement. We hope that the Government already realizes the possible range of economic crisis and is aware of its responsibility for the development of economy in our country. In these difficult times we expect the Government to discuss its measures with its social partners. The CMKOS is ready for such debates.