A key piece of anti-corruption and transparency legislation appears to have been gutted by an unholy coalition of lower house lawmakers.
It’s a cautionary tale of how one change can result in a landslide of amendments and, according to many, almost totally gut a flagship piece of anti-corruption legislation. But that’s what happened in the Czech lower house of parliament as an existing law aimed at forcing public companies, regions, state agencies and ministries to reveal details of all their contracts was watered down to a shadow of its former self.
Misgivings about the proposed law creating the registry of contracts had already been voiced for months by Minister of Agriculture Marian Jurečka over the prospect that the last remaining brewery in state hands, Budějovický Budvar, would have to show its hand about its deals while rivals in the private sector would not. Jurečka introduced an amendment excluding the state-owned brewery from the scope of the proposed law and other lawmakers followed suit.
Soon the list of excluded state companies widened to also include the post office, rail company, and forestry company, air traffic operator, and state mining company Diamo – massive companies with large budgets and a large slice of overall Gross Domestic Product.
The exemptions were also widened to cover public broadcasters Czech Television and Czech Radio. The former argued that many of the deals covering the screening of sports rights should not be made public. The latter argued that many special deals were offered to it in private which companies simply would not want to be in the spotlight and part of the public sphere.
And municipal and regional companies that have the character of industrial or commercial businesses will not be covered according to the amendment either.
One of the lawmakers backing a wide and effective register, Jan Farský, of the STAN party reckoned that around 70 percent of the total number of state contracts that should have been covered by the measure were now exempt as a result of the changes. He used the Czech phrase which literally translates as “de-boned,” castrated might be the English equivalent. Minister Jurečka, the source of the original amendment, expressed regret and disappointment at the turn of events.
The damage was done by a broad cross party coalition of lawmakers from the leading government party, the Social Democrats; Communists, Dawn party, right-of-centre Civic Democrats, and Christian Democrats. The changes were passed by the most narrow of margins, 80 out of the 159 lower house law makers present.
Lawmakers from the ANO party were absent from that coalition, with leader and minister of finance Andrej Babiš afterwards saying that he did not agree with the exemptions and would now redouble efforts to make state companies more transparent and answerable to their supervisory boards.
The proposed amendment now goes to the Senate. Ironically, the register of agreements was already up and running since July last year after being approved in both house of parliament. It was expected to be given real teeth from July this year when the sanction for not publishing contracts would be the simple fact that they would not be valid.
The registry was recently described to Radio Prague by the head of the Czech branch of anti-corruption and good government promotor Transparency International as a “sunshine act” which would shed light on a lot of shady areas and likely have a real impact in improving the country’s performance.
David Ondráčka added on Thursday that he did not have much hope that the upper house, the Senate, would overturn the changes given that many mayors were opposed to the concept of the registry. The latest move fitted into a pattern of anti-corruption moves being diluted so that they were not longer really effective, he added.