Press conference of Prime Minister of the CR, Mirek Topolánek after the meeting of the government on Wednesday 15th November 2006

Radim Ochvat, secretary of the Prime Minister: Good evening, ladies and gentlemen, welcome to the evening press conference after the meeting of the government. I welcome the Prime Minister, Mirek Topolánek, the Minister of Agriculture, Mrs. Milena Vicenová, the Minister of Industry and Trade, Mr. Martin Říman and the Minister for Regional Development, Mr. Petr Gandalovič. As an introduction, I give the floor to the Prime Minister.

Mirek Topolánek, Prime Minister of the CR: Good afternoon, ladies and gentlemen. We live in a country where the government governs, the Parliaments holds its sessions and political parties live in rare symbiosis and therefore I will inform you on the main issues of the agenda of the meeting of the government. I think that it is the decision of the government on the distraint upon property of the Setuza, joint stock company because of claim of the state, or rather the claim of the PGRLF, which deserves to be mentioned as the first one. The government was choosing from four variants; it was not the first government, which debated this issue; however this government finally decided to use the way of distraint, as any other method would not ensure advantageous solution of claims for the state. We chose a standard solution, which is in the interest of the state, agricultural producers, suppliers, customers, and apart from other things, also employees of the company. Regarding views that had helped us in the course of finding a solution, it was the economic point of view and the international point of view, because the Ministry of Agriculture has received a letter and a request of the European Commission regarding explanation of unauthorized support of the state just for the company of Setuza, which we have to respond to. That was one of auxiliary arguments for this solution. But there was also the security point of view. The solution is transparent and the state, which is represented in this case by the PGRLF, may attain its rightful requirements and claims. I would also like to say that the government of the CR, whether it is this government or the next one, will protect its rightful economic interests for the benefit of citizens; and I must say that in this case the action was consulted with the opposition. Of course, more detailed information will be provided by minister Vicenová. We also debated a material, which had been announced and which means that the government suspended the decision on the transfer of the helicopter base from Přerov to Náměšť nad Oslavou without any unfavourable influence on investments in Náměšť. The decision has been postponed by one year. In this year, feasibility and return of investments of the mixed army-civil airport must be proven. The government assigned the respective ministers with a task, in cooperation with the Zlín Region, Olomouc Region and the statutory town of Přerov, to work out feasibility study also with regard to financing of such a mixed army-civil operation. We also approved the bill amending act, which is to determine requirements regarding banks, saving banks and credit unions, and the government would desire, in cooperation with the Czech national Bank, the act to be valid starting from 1st January. We will ask the Chamber of Deputies for accelerated approval procedure during the first reading, which is very courageous, but this law deserves it. I have a feeling that four conclusions of the NKÚ (Supreme Audit Office) deserve certain comment. I have a feeling that even during the short time of our governance, we succeeded in attaching great importance to those materials and the government returns every material, in which there are no measures taken aimed at remedy or determination of liability to indemnify the employer and personal and other liability. Today's four materials, whether they concerned the Ministry of Industry and Trade, the Ministry of Interior regarding publishing activities of the respective administrators of the state budgetary headings, the Ministry of Environment and the Ministry of Education were debated thoroughly, but without reservations and they were approved. Just to amuse you I must say that in the framework of publishing activities at the Ministry of Defence publications were approved and published like "Nymphomaniac" – 500 copies, which were located at the Army Grammar School in Česká Třebová. That was information so that you know what it is possible to reveal during these inspections. Further issue I will leave to the Minister for Regional Development to make some comments and explanations. It concerns two materials that have been awaited for a long time. I would say that the government taking great pains recouped the delay regarding the debate on the strategic reference framework for using means fro structural funds. In connection with this, the material on proposals of operational programmes for 2007-2013 has been approved today. I will leave it to the minister. We also approved removal of environmental damage in the company of Tatra Kopřivnice, we approved range of other materials, and nevertheless one of them, which are of great importance, will be presented now by Martin Říman.

Martin Říman, Minister of Industry and Trade: Good afternoon. The government approved today the programme of implementation of gradual reducing of administrative burden of small entrepreneurs and small enterprises. The Ministry of Industry and Trade has chosen more than 150 various legal norms, from laws to various executive regulations, which significantly complicate activities of small traders from the administrative point of view and assigned the Minister of Industry and Trade with a task to coordinate works on analyses and simplification with other ministries. A typical example is, which was realized in last weeks in the framework of a pilot project of preparation for this great and complex project, was simplification of the regulation on hygienic requirements for restaurants, which you may have required in last weeks. It was a typical example and we want to continue like this in the future. It concerns legal norms of all the spectrum of activities, from the environmental sphere to the sphere of finance. The second material, which has connection with this, is analysis of control activity system in relation to traders. We have found out, after monitoring the situation, that certain matters are controlled twice or even five times. For example sale of spirits and tobacco products control five different institutions without any linkage. It means that the Ministry of Industry and Trade will prepare a new system, based on the material debated today and on the approval of the government, which will simplify the system of controls in the entrepreneurial sphere. That was my brief information.

Radim Ochvat, secretary of the Prime Minister: I thank the minister and now I give the floor to minister Vicenová.

Milena Vicenová, Minister of Agriculture: Thank you for the floor. I would just like to specify information that the decision of the government continues the resolution of the former government of 16th November 2005, in which there was stated clearly that we were obliged to solve claims concerning the company of Setuza. I would also like to remind you that a tender has been called in summer, and four participants had entered it. This public tender was necessary to be annulled after consideration of all eventualities and above all due to the fact that the PGRLF pays high taxes, which burden the state budget and detract financial means of farmers. With regard to the fact that other eventualities that had been debated could result in justified doubts regarding usage of state aid, as we are oblige to act with due diligence and we have to solve the situation without delay, a solution was adopted to use the method of distraint. That was information regarding Setuza.

Radim Ochvat, secretary of the Prime Minister: I thank the minister and as a conclusion of the first round I ask also the Minister for Regional development, Pert Gandalovič, for a few words.

Petr Gandalovič, Minister for Regional Development: Good afternoon, ladies and gentlemen. The stage of discussion on spheres and purposes, where the European money in 2007 – 2013 will be used, was finished today. As you know, we will have about 100 billion crowns per year at our disposal. Negotiation regarding this issue is starting with the European Commission and I am optimistic, I suppose that it could turn out well, as we have been discussing those issues with officials of the Commission and we are doing our best to have it approved, so that using money could be started on January 1st 2007. I would like to add that further three great tasks are ahead of us, namely preparation of executive regulation for all the operational programmes. Then we must reach an agreement on the mechanism of financial flows. I would like to emphasize here that it will be continuous financing. All of us know what it means, because up to now, the European money was given to applicants in the end and therefore a lot of applicants were discouraged. And the last task is a monitoring and consistent control of usage of European money. And I would like to emphasize the word transparency. So, these are tasks that are ahead of us and I repeat again – we will do our best to the entire system would be ready to be used starting from January 1st 2007. Thank you for your attention.

Radim Ochvat, secretary of the Prime Minister: I thank the minister and now your questions, please.

Jana Klímová, MfDnes: I would like to ask a question regarding Setuza. I suppose that the state aid, or fears of the state aid is a result of the complaint of Agroodbyt to the European Commission; but still, I would like you to explain it in more detailed manner to me – what was the danger regarding investigation into a state aid? And then, I would like to ask – it was yesterday when your ministry claimed that this material would not be surely debated today, can you say why you opinion was changed? And my third question is for the Prime Minister. You have mentioned that one of reasons was also the security aspect. Can you explain why you decided to act?

Mirek Topolánek, Prime Minister of the CR: The answer to you last question is quite clear as the meeting of the government regarding this issue was held under the closed regime. I cannot tell you what security reasons led to proposal of the distraint. And I think you understand it. Concerning the material, I think you are mistaken. It was just said that the material was not on the agenda of the government at that moment; it was included in the agenda in the morning, which is admissible, of course. And regarding the third question, I give the floor to the minister Vicenová.

Milena Vicenová, Minister of Agriculture: Yes, I am glad I can add information. Any solution where the original owner might hypothetically get lower price than the market price, could be regarded as unjustified state aid. This is the first matter. The second matter is that it is a situation is always compared with the situation where due diligence had been applied. This is such a classical view. In case a state acts in a different manner that a private owner would have acted, it is always a suspicion of usage of the state aid.

Mirek Topolánek, Prime Minister of the CR: I will just add why the government debated this issue, when the PGRLF is a joint stock company. The first reason is that the state owns 100% of shares in the PGRLF and second, the resolution of the previous government, which had decided that it would be the government, which would decide regarding claims of the PGRLF against the Setuza.

Radim Ochvat, secretary of the Prime Minister: Further question, please.

Miluše Hlinovská, ČTK: I would like to ask minister Gandalovič, whether he could say in which areas the money from the EU will be spent, especially in the next programme period? Thank you.

Petr Gandalovič, Minister for Regional Development: Well, as I have already said, it is about 100 billion crowns per year and we divided this portion, of course in cooperation with the individual ministries and regions, in such a manner, I cannot say exact figures, but it will be about 19% for the environmental area, 22% for the transport area, 18% for regions, it means for so called operational programmes and then there are such areas as education, human resources and lesser programmes in the sphere of healthcare, culture and the integrated rescue system. The entire framework or measures to which means of the European funds may be invested, is based on so called National Strategic Reference Framework, which is a document that is prepared in cooperation with the European Commission and is based on national priorities and priorities of the EU; it means those priorities that are aimed at strengthening of competitiveness, human resources development and let us say also at harmonious development of regions. Well, these were resources, let us say ideological resources which are a basis and in the end there are of course concrete figures for concrete areas of economy and public life.

Mirek Topolánek, Prime Minister of the CR: If I can I would just add that we have entered this process with great delay that had occurred in this year, I mean the CR. Nevertheless, despite this, we managed to do certain transfers and perhaps the Minister for Regional Development should have said that the transfer just to the regional operational programmes was higher by 4%, which means, by the way, significant decentralization of the entire system. It results in complications because of number of titles for which structural funds are provided, nevertheless it secures what we regard as right, and it is decision-making on the regional level regarding allocation of money.

Radim Ochvat, secretary of the Prime Minister: Thank you, further question, please.

Newswoman: I would like to ask the Prime Minister. You say that because of security reasons you cannot say why you decided to use the bankruptcy, the distraint. Nevertheless, the server "aktualne.cz" states that it is because you regard the entire sale as a fictitious one, and that people around Tomáš Pitra are still controlling the company. Could you affirm it or at least refute it?

Mirek Topolánek, Prime Minister of the CR: As I have stated before, at the first place are economic views, at the second place international views regarding unlawful public or state aid and only at the third place there are security views. This is what I can confirm.

Newswoman: Can you say what could arise from this theoretically, what the impacts on employees will be, following your decision?

Mirek Topolánek, Prime Minister of the CR: Owing to the fact that you have used incorrect term bankruptcy, I must say that the distraint does not mean that the existing management will leave. Only range of actions is subjected to an approval and countersigning of an administrator, who is nominated by an executor, and it just means that the production process continues, nothing else. And analyses show that by means of this measure the value of the state claim may be even increased.

Radim Ochvat, secretary of the Prime Minister: Further question, please.

Jan Hloch, televize 24.cz: I have just a technical question. The press conference should have started at 13 o'clock. Why it started 15 minutes earlier without informing newsmen?

Mirek Topolánek, Prime Minister of the CR: Press conferences are held after finish of the meeting of the government and I have decided on it, if it can calm you; I did not know that the start was scheduled for 13 o'clock, I apologize myself.

Radim Ochvat, secretary of the Prime Minister: Further question, please.

Marta Nová, televize Prima: I would like to ask since when the distraint is to be started? And then, I would like to ask, Mr. Topolánek, there are speculations regarding names of new members of the government, could you tell us some names, when will you know them concretely?

Mirek Topolánek, Prime Minister of the CR: The government may decide on the method of distraint, but on all other steps decides a court. The court in Ústí nad Labem is deciding now, in these hours, whether the distraint may be executed. It means that the government cannot do anything else. That was regarding your first question. I regard your second question as groundless, I regard such speculations as improper and I do not want to make any comments on it.

Radim Ochvat, secretary of the Prime Minister: Yes, further question, please.

Veronika Kračáková, televize Nova: I would like to ask the Prime Minister what the main topics of the debate with Mr. Klaus at the Castle will be. And the second question would be for Mr. Říman; would you like to be the Minister of Finance instead of Mr. Tlustý and what would be your comments concerning today's speculations?

Mirek Topolánek, Prime Minister of the CR: I am bringing to our President plums from our garden. I think he will be satisfied.

Martin Říman, Minister of Industry and Trade: I will answer the second part of your question by referring you to the answer of the Prime Minister on case of previous question. You certainly have not expected anything else.

Mirek Topolánek, Prime Minister of the CR: But still, it would be proper to say, as those questions have a certain core, so that my answer would be correct – all negotiations will be starting next Monday, next week. The reason is quite logical, it is the congress of the ODS. If an agreement is reached then it will have to be broader agreement of more democratic parties, and about names, functions, forming of the government which parties will be in the government directly, these issues have not been debated so far. I will calm you; there was no debate on names.

Radim Ochvat, secretary of the Prime Minister: Further question, please.

Aleš Sosnovský, ČTK: Good afternoon, I would like to ask you whether the government by chance debated, in the framework of discussion on the reduction of administrative burden, the proposal of the Minister of Finance for consolidation of taxes, health insurance and social insurance.

Mirek Topolánek, Prime Minister of the CR: No, it did not; it belongs among short-time priorities. The Minister of Finance, whether this one or the future one, as I hope, will submit the material, and I hope it will be this year. This legal norm is rather complicated and it is not very simple, so, we did not debate it today. It was the intention of this government.

Radim Ochvat, secretary of the Prime Minister: Further question, please.

Ondřej Černý, Radiožurnál: Prime Minister, one more and the last question. I would like to ask whether your today's decision regarding Setuza has certain connection with negotiations with the ČSSD, because the time connection is quite evident. And the former Prime Minister and the Chairman of the ČSSD, Jiří Paroubek, had called Tomáš Pitra an enemy of the state. Do not you try to accommodate the ČSSD by mean of this measure?

Mirek Topolánek, Prime Minister of the CR: I regard this speculation as unsubstantiated. It has no connection, the only one connection, which is here, is that this issue was solved by the former government and because of time reasons it had not realized the same intention, which the existing government is realizing now.

Radim Ochvat, secretary of the Prime Minister: Thank you. Does anybody have a question? If it is not so, thank you and I wish you nice day.