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October 21, 2021



Czech Government approves start of bill on social enterprises

17.5.2017 7:46
Bohuslav Sobotka (SOURCE:
Bohuslav Sobotka (SOURCE:

On 15 May the Czech Government approved a document outlining its intention to draft a bill on social enterprises which should establish clear rules for such firms, the advantages they would enjoy, and the terms of state support for them. Czech Prime Minister Bohuslav Sobotka (Czech Social Democratic Party - ČSSD) announced the news on Twitter.

The law was originally meant to have taken effect this year, but it is no longer realistic to expect it will be adopted before the autumn elections. The team of the Czech Human Rights Minister, which drafted the bill, believes it will improve employment for people living in ghettoes and therefore the state of the places where they reside, as well as reducing welfare benefit expenditures.

According to experts on social issues, social enterprises could give work to several dozen thousand people. The law "will increase the chances for persons from disadvataged groups to be employed in public benefit projects," Sobotka tweeted.

Social enterprises function in the Czech Republic already. There are 239 such firms country-wide.

Sobotka's cabinet pledged to support social enterprises further in its coalition agreement. The material outlining the rules was supposed to have been ready two years ago and the detailed wording of the law was supposed to have been completed by the end of 2015.

Drafting of the law has encountered delays. The Human Rights Minister's team has actually drafted the bill already, but there has not been agreement on it in the cabinet itself.

According to that bill, a social enterprise would be defined as one that uses more than half of its profits for its own development or for fulfilling a public benefit aim. The portion of revenue specified should come from its own earnings.

Social enterprises would not be allowed to fall behind on their employee contributions or taxes. They would also have to take the environment into consideration during their work and use local resources and local work forces.

The enterprises should employ socially disadvantaged persons - immigrants, the long-term unemployed, members of minorities, people living with disabilities, and people nearing retirement age who find it difficult get jobs. It should be possible to use EU funding for the social enterprises.

Applicants would formally apply to the Czech Labor and Social Affairs Ministry for social enterprise status. That ministry would maintain a registry and information from the registry should be available online to those interested.

The Czech Finance Ministry has taken exception to the proposed outlines of the law. The Finance Minister is bothered by the increased expenditure for administration of the social enterprise agenda.

Czech Vice Prime Minister for Science Pavel Bělobrádek (Christian Democrats - KDU-ČSL) asked that the material include an enumeration of the benefits social enterprises would enjoy. He believes they should enjoy advantages during public tenders.

Labor unions, municipal associations and the Olomouc Regional Authority also commented on the material. The number of social enterprises is increasing in the Czech Republic, and during the past four years their number has tripled.

While in the autumn of 2012 there were 70 such firms listed online, today there are 239. One-third of them do business in gastronomy, while more than one-fifth provide cleaning, gardening, and property maintenance services.

ČTK, translated by Gwendolyn Albert
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