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SUMMARYExcerpt from an Interview withĽudovít KANÍK, the Minister of Labour,Social Affairs and Family of theSlovak Republic.Even though all governments afterNovember 1989 had social andpension scheme reform imbedded intheir Programme Resolutions, yourpredecessors in this seat have implementedonly some kind of cosmeticacts changes. Radical change istaking place only today under yourleadership. Can you explain whatare we expecting from the legislativechanges complex?New social policy aims to change thingsfor the better, to help solve backloggedsocial problems and react to and catchup with the most current trends within theEU. We want the social policy to supportfamilies and threatened groups, to helpcreating job opportunities, to make workattractive and for the new pension schemeto introduce the possibility of choiceand higher pensions. These are goals weshould reach with respect to the adoptedacts and in case of ongoing reforms. Theimplementation tool is the introductionof a strong capitalisation pillar into thepension scheme, family benefits motivatingfor employment, social benefits rewardingactivity and liberal labour law supportingemployment flexibility.Lets theorise a bit. Is it possible tocalculate, name at least roughly, whatSlovak citizens have lost because ofthe pension scheme reform not havingbeen implemented along with theCzech Republic in 1995?Introduction of the voluntary pillar intopension scheme, that took place in theCzech Republic, cannot be considered pensionscheme reform. The voluntary systemhas been working also in our country forseveral years, but is not able to solve principalproblems of the continuous system.Today, we have already adopted legislationimplementing the system of pension savings.Of course, I am convinced should wehave prepared such reform earlier, manyproblems, for example fast need for retirementage increase, growing deficit, lowpensions, did not have to be that acute. Ithink pension system in the Czech Republicis not in a better conditions than the oursprior to the reform.In what time span can we expectfull success of reforms, meaningtheir positive result not only in Slovakmacroeconomics, but also in citizenspurses?Provided the started development willcontinue, I believe already this year willshow an improvement and we may expectalso a more significant improvement in livingstandard in year 2005. Especially workingparents with children will feel positivesof the reforms already this year.The public, but also part of politicalscene are negative about the changesand their rejection by the Presidentlegitimises this resistance. However,has reforms opposition offered anyalternative solutions?In every country, the opposition criticisesGovernmental policies, that is legitimate.Many of the opposition MPs I have oftendiscussed the adopted measures with, hadno contents, expert problem. It is ratherthe opposition leaders’ rhetoric, that haspolitical purpose. The current oppositionbuilds on population fears in light of the biggovernment reform scope, as such reformshave no their like in Slovakia. However, I amconvinced the second half of the electionterm will show a turn also in this area. Peoplewill have more chance to understandwhat we are doing. Therefore, I have tocondemn efforts of part of opposition andKOZ, the Trade Unions Confederation, toorganise early Parliamentary elections. Indemocracy, it is considered playing withfire. It establishes a dangerous precedencefor the future.Lately, the fact of state withdrawalfrom the payment of sick and pensioninsurance for students createda storm of dislike. In this respect youpointed out, that better educatedpeople will have higher pensions andothers concluded, that students donot need to worry, as the act will beamended several times. Where is thetruth?The question of voluntary student leviesis not well asked. The new pension schemeintroduces significantly higher pensions foreducated citizens compared with the oldone, that did not sufficiently consider thenumber of years worked, nor the income.Currently, a university educated personearns about twice as much as a person withonly basic education. In the old system, thedifference between their pensions wasminimum. In the new system,u n i v e r s i t yg r a d u a t e shave much better chanceSUMMARYto influence the final amount of their pensions.Even if the state does not contribute tothe system on behalf of students, their pensionis significantly higher compared withthe old system in which the state made itscontributions. From this point of view, thequestion of levies payment through thestate is irrelevant.The new social system should bemotivational in respect of many unemployedand social benefits receivers.Do you believe it is possible to changepeople with certain habits, taughtonly to listen and not use their ownbrains?I do, even though not absolutely. Weare defining clear and understandablerules. Our everyday slogan is “Work Pays”.We have adjusted the social system to thisslogan. Experiences from around the worldshow, that social benefits not linked to thecondition of activity do not help citizens,they increase their passivity and dependenceand result not only in negative economic,but especially social-moral impacts.A society in which more and more peoplebecome dependent on social benefits isin big trouble. We are trying to hand outfishing lines instead of fish for everybody tocatch his/her own fish.Excerpt from an Interview withMiroslav BEBLAVÝ, State Secretaryof the Ministry of Labour, SocialAffairs and Family of the SlovakRepublicFour years ago you participated inthe state administration audit aimedat its reform. Has this been some kindof platform for the social reform youare a co-designer of?The state administration audit andespecially issues building on it have createda basis also for the agenda we arecurrently trying to enforce in certain areasI am co-responsible for. This means stateservice, public service, state administrationorganization, but it influenced marginallyalso other areas I am responsible for, e.g.employment, where the focus was on otherprojects development. If I remember right,in January or February 2000, when theunemployment rate climbed to twenty percent, together with Martina Lubyová weprepared several analyses based on previouslydone work. These analyses resulted infurther ideas, not so much the state administrationaudit.The entire reform complex yourMinistry is currently implementing isradical in terms of the after Novemberperiod and has truly an impact onevery citizen. It is divided into severalphases. What is important, crucialand what is secondary?The answer is partially hidden in thequestion. In one way or the other the changeshave truly an impact on every personin Slovakia and everybody considers tobe most important what is relevant tohim/her. Retired and those about to retireconsider pension scheme reform the mostimportant, people in material need andeconomists worried about employment asa prerequisite of successful economy aremore interested in benefits, the LabourCode reform, etc. Public servants consideredmost important the Act on PublicService amendment the most important. Itdepends on each recipient.I would not speak of any acts prioritisation,but rather of their order. It was impossibleto do everything at once; thereforewe have prepared reforms with a certainschedule. We had to decide on what had tobe immediately, what may and should bein half a year and what in two years. First,we were solving issues that were easier tochange, where there was a greater politicalorder and which were easier to prepare.We have postponed what needs more extensivelegislative-political preparation. Theorder is not one of importance. It is rathera reflection of several factors.To what extent is the State Budgetlimiting?It is important in the pension scheme reform.It is well known, that should nothingchange in the existing system, pensions wouldbe gradually dropping or else it wouldrequire more and more funds comparedwith today. It means that in the effort tocreate an environment in which peoplewill be able to adjust to the demographicchange without lower pensions or financiallyunbearable burden for other tax payers,the aspect of state budget is important.For other changes, especially for levies andemployment the state budget was not thatcrucial. For example, it is not planned tospend significantly less money for peoplein material need. There has rather been theeffort to organize a system creating suitablemotivation, pushing employment ratesimprovement. It is well known that onlysuch a cake may be divided into portionswe have available and the most importantactivity of any government is an effort tomake that cake bigger. Social scheme hadto be fundamentally redesigned in order toback up the goals of government and societyby improving the employment rates.Have you followed any of the EuropeanUnion countries examples in thesocial program development?We were striving especially for allreform walking the same direction and itwas necessary for them to fit our conditions.Denmark, Ireland and different thanSlovakia. Of course, a lot of inspirationhas come from abroad. In the past sevenyears, the European Union has paid a lot ofattention to employment, it has done manyanalyses and this was an inspiration for us.What we are enforcing is in line with theEuropean Commission recommendations.We were especially interested in countries,where we have seen some similarities andsuccess, i.e., Ireland, Portugal, Spain, TheNetherlands, but the Union as a whole representedan important inspiration.There is a novelty in sick pay, accordingto which the first ten days arepaid by employer. And the first threedays are still very low. May this leadto a situation among better remuneratedpeople, where they will ratherwork sick or use their holidays?We have implemented an insuranceprinciple. This means a person receivessick pay calculated from the same salarysuch person pays levies from. We haveimplemented justness and insurance principle.Secondly, it is everybody’s individualchoice. If one does not feel well, one can decideabout going to work, using holiday orstaying on sick leave. Should anybody missincome for the first 3 days, holiday use is athand. Who decides a few hundred crownsare not important stays on sick leave. Forpeople who are not often and long-termsick, it is not an issue. The only group itmight cause problems to are the often andshort-term sick. Those should think aboutprevention. The new reform decreasessignificantly the possibility of abuse andimplements the insurance system. Collectiveagreements are open to even betterconditions negotiation; it is only about theTrade Unions to negotiate.Excerpt from an Interview withVojtech TKÁČ, Chairman of the ParliamentaryCommittee for SocialAffairs and HousingAs an opposition MP you countamong the most common and expertcritics of the present government socialreforms. Why?I am in po-litics becauseof reforms, as Iam convinced86 87of the change in social and economic areasand of change in population awarenessabout its fortune. However, I have seriousobjections to the implementation of reforms.They are not co-ordinated, changephilosophy and basis of social sphere andignore European values, such as socialpartnership and social dialogue whichrepresent attributes of social sphere in theEuropean Union. Reforms are not linkedto tax, economic and financial spheres. Iexpress my very serious objections to theinstitutional reform, when the characterof institutions changes, they are becomingmore state-like. This was not the case evenin a period critically evaluated as non-democratic.On the contrary, the institutionswere relatively independent, without interventionand personal political problems.So you consider the methodologyof these reforms to be wrong?The leading politicians have nobodyto blame anymore, as it has been in thegovernment for six years and its constantpromises about better times is remindingme about the previous regime with a slogan“As you work today, so you will livetomorrow”. The Prime Minister, nor any Ministershave the right to promise they wouldchange real income. It is nonsense becausebusinessmen and the Trade Unions are responsiblefor income. As of 16 January 1992we have introduced collective negotiationsand collective agreements. However, thissystem is often unprofessional and incompetent.The matter is that the governmentrealising it cannot promise what the previouscentral and directive government could.Politicians and especially statesmen shouldtell citizens about the possibilities of the government,that it is about creation of conditionsand that the region is also responsiblefor its fortune.The Government has already informedof the intention to cancel tripartite.What can this mean?It is not enough to change the rules inthe course of a football game and think ourplayers will play better. Similarly, it is notenough to introduce some act and thinkthe partner will sit at a desk and negotiate.Partnership has been globally disturbed inpublic legal institutions such as the SocialInsurance House and the National LabourOffice, where the Trade Unions and employersgot on a side track. There is an effortto limit co-operation with the InternationalLabour Organisation. There are 75 validagreements of the International LabourOrganisation and extra close connectionbetween the European Commission, theCouncil of Europe and the InternationalSUMMARY