Thursday, 24 April 2014

Minister to propose end of sCards for welfare payment

3 May 2013

Prague, May 2 (CTK) - The Czech cabinet recommended that Labour and Social Affairs Minister Ludmila Muellerova (TOP 09) start taking legislative steps to scrap the project of electronic social cards (sCards), Prime Minister Petr Necas (Civic Democrats, ODS) said after a cabinet meeting Thursday.

Muellerova said she would respect the recommendation.

She said a series of talks at her ministry but also with the Ceska sporitelna (CS) bank that operates the sCard system for welfare benefit payments would be launched.

CS won a tender for the sCard project and former labour minister Jaromir Drabek (TOP 09) signed a 12-year contract with it, under which nearly all state benefits and allowances and later also pensions would be paid via the sCard system.

The bank will probably demand financial compensation if the project is scrapped. Necas said previously the state acknowledged that the bank had its expenses. The calculation of the compensation would be negotiated about.

CS head Pavel Kysilka said earlier the bank invested about 300 million crowns in the project.

Social Democrat leader Bohuslav Sobotka (opposition CSSD) said Drabek and not taxpayers should cover the costs of the possible compensation.

Muellerova did not say when she would submit the plan for the project's termination to the cabinet.

"I don't want the sCard to be an issue of political disputes," she said.

Muellerova Thursday again proposed modifications to the sCards, but only four cabinet members supported them, Necas said.

It is probable that only the four ministers for TOP 09 present Thursday backed the continuation of the project.

The scrapping of the project is promoted by the ODS, the CSSD, the Liberal Democrats (junior ruling LIDEM) as well as the association of disabled people and trade unions.

Deputy Prime Minister Karolina Peake (LIDEM) said she believed sCards should be either scrapped or turned into only one of the ways of paying welfare benefits.

About 274,000 people received the sCard and over 4000 rejected it. Under the original plan, one million people were to use it now. Over 1.3 million benefits worth 7.34 billion crowns have been paid via the electronic cards so far. Drabek claimed that the state would annually save up to 250 million crowns thanks to sCards.

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