Thousands of unproductive hours and about 72 billion crowns per year. According to the Chamber of Commerce, these are unnecessary administrative expenses incurred by companies. According to him, these could be better invested – business development, workforce or increasing value added and GDP growth.
Without passing it, the restart will not take place
However, the benefits of reducing the bureaucratic burden can be even greater – the government will not only save, but also make money. “If we also count the positive effects of reducing bureaucracy, such as a greater willingness to do business or freeing employees from offices for some productive work, according to our estimates we reach the Czech 25 billion crown economy every year,” he explained to SZ Business. Chamber Vice-President Tomas Brusa. “We will get this advantage by removing only a quarter of the unnecessary bureaucracy. I put it simply – there will be no restart of the Czech Republic without massive cutting of unnecessary documents.
For its claim, the chamber drew comparisons with foreign countries, focusing specifically on food and restaurant sales. “Stores are the most common type of business – a supermarket needs people with the same job description in Spain, Germany and the Czech Republic,” Bruza’s methodology describes.
The result for the Czech Republic was not favorable. “In the Czech Republic, the department stores have to have 17% more skilled personnel than in Germany, precisely because of paperwork, various reports and reports,” the vice president explains the results. “Similarly, you can compare, for example, the excesses of different study systems that don’t coordinate with each other when, where, and what they study.”
“Each year, restaurant operators in the Czech Republic face 45% more inspections than in neighboring Austria. And in the Czech Republic, they often inspect large and honest establishments rather than going after questionable operators.”
Government as regulator of bureaucracy
These are not the only numbers the Chamber of Commerce is arguing for. According to him, the government currently imposes more than 2,147 obligations on self-employed people and companies, based on only 34 laws used by entrepreneurs, which are often associated with excessive administration. On top of all this, the number of EU regulations is also increasing.
Representatives of the Chamber of Entrepreneurs in the Czech Republic reported this to the National Assembly in mid-June. As part of it, they also brought in the Anti-Bureaucracy Act. According to the proposal, the latter should provide the duty “to review and eliminate unfair regulatory and disproportionate bureaucratic burdens, and for entrepreneurs to participate in this review” from 2025.
“The administrative burden on entrepreneurs is constantly increasing, while the big problem is that the government does not retrospectively evaluate the effects of increasing regulations,” said Zdeněk Zajíček, president of the Chamber of Commerce during the presentation. “Therefore, the central administrative bodies of the state administration, according to the competent law, responsible for the relevant area from the point of view of creating legal regulations, should receive a new duty to review the regulation and effects. Administrative actions.”
A court of bureaucrats rather than officials
The chamber has long drawn attention to the overburdened bureaucracy in the country. It’s not even a year since Prouza v Interview for Radiožurnál Simplifying the bureaucracy of investments and allowing mechanisms is one of the three steps the Czech Republic needs to move towards higher value-added manufacturing.
“When multinationals think about which European countries they want to invest in, the Czech Republic is missing out,” Brusa explained. “An investor commented that they were already building and operating in Poland before obtaining a building permit in the Czech Republic.”
Last week, the vice president toughened his assessment. “You’re in a situation where you have a funding period of seven years, funding the D3 extension or the North Bragg Ring Road, and in seven years you don’t even allow construction,” he said, again facing an issue. Construction Management Štěpán Křeček’s offline podcast. “So at the beginning you say you want money for infrastructure, and five years later you find out you don’t have a building permit, so you don’t waste money, building searches in the canyon or bike paths.”
“Today, the courts are a bigger problem than the authorities. When you go to trial, it takes three to seven years to get a verdict, and that’s when we wanted to introduce the deadline, and at that time the judges laughed at us and always found a way to block it, to postpone it.” Bruce continues.
“We are a much bigger Austria-Hungary than the Austrians. Most of the bureaucracy is internal. Fundamentally European, but we make it more complicated. Whenever there is an idea to reduce the bureaucracy, the person concerned talks about making cuts elsewhere. It is very disruptive for us, all services are more They are expensive, you postpone things, you don’t modernize, you don’t create.”
Worst in the EU
They notice how much paperwork the Czech Republic needs, even across the ocean. That includes the US News server Country comparison He follows bureaucracy. The nation ranked 11th out of 87 states ranked by the US newspaper for bureaucratic complexity. All EU countries are doing well.
According to Prouza, the server’s rating may not be wrong. “The government has a huge mistrust of entrepreneurs, and at the same time it can’t prosecute even completely obscure matters quickly and efficiently,” he reckons. “Remember, for example, how long it took to convict a prominent politician who was involved in a money laundering case,” recalls David Rath’s case.
“So instead of trust and quick and severe punishments for abusers of that trust, the government in the Czech Republic hides new and new obligations on stamps, verified signatures and paper. It’s easier to get angry because you filled out the wrong column on page 15 than to punish the wrongdoers,” says the vice-president.
The international comparison is based on responses from more than 17,000 respondents and tracks whether, for example, the number of people employed in the public sector or whether pay and employment practices in the public sector contribute to higher public sector productivity, better service delivery and better performance. Management.
While there is agreement among the groups that bureaucracy is a problem in the Czech Republic, Brusa does not see the situation rosy. “Two years ago, I would have been more optimistic. At that time, we presented 441 proposals to reduce bureaucracy in the Chamber of Commerce, which were specific proposals, specific textual amendments to the law,” says the reason for low expectations. “For example, we expected the law minister to catch on, who talked a lot about cleaning up the legal system. He thanked the suggestions and put them in a drawer.’
“At least some of them have been adopted by the Ministry of Industry and Commerce in their anti-bureaucracy packages, but we expect more,” he continues. “At least we have learned that we have to be tough and brave, otherwise we will continue to miss the train economically and grow much slower than the rest of Europe.”
Government is no longer just the night watchman
“The problems are that you do something extra, it costs a lot of time and it’s useless,” says Law Minister Michal Šalomoun, describing the obstacles in the SZ Biznys system. “This can be true in different areas of life and we do it to ourselves as a society. Even if we complain about bureaucracy, it applies to some key players,” explains the minister.
“I firmly believe that many obligations have been laid down in the law for various players to adopt norms with a broad consensus. The government no longer fulfills the role of the so-called night watchman, but goes further and intervenes in various areas,” he begins the argument.
“Among them, various actors from the state administration, municipalities and other players move in these areas and have a constant tendency to increase their influence, consolidate in other areas or at least express their presence and indispensability. These movements are complemented by a certain tendency to talk about everything, without taking responsibility for anything.”
Retrospective evaluation of regulations
But Solomon immediately adds examples of how he solves the situation, for example, the organization of anti-bureaucratic collections. Three are already appreciated, and the fourth is on the way. “Here, we are taking small steps and patiently convincing individual ministries that fulfilling certain obligations is not really necessary,” says the minister.
The Chamber of Commerce’s proposal can be envisioned at the level of government draft laws. “But the problem is not that vulnerability assessment is not practiced, but that it is done only systematically and with poor quality,” he explains.
“Once I joined, I started to create the Government Analysis Unit (VAÚ), which will help the departments to do these high-quality analyses,” Šalomoun describes the work of the 15-person team. At the government level, according to the minister, it could also introduce the opportunity to retrospectively evaluate whether the provider has met the promised targets. “If this succeeds, the said legislation will not be necessary.”
