Costing half the average salary - is the Slovak state too expensive?
23.5.2008 - Anca Dragu

A group of economists in Slovakia have worked out that the cost of running the state amounts to almost half the average pay packet of each and every citizen. The economists looked at the cost of state institutions like Parliament, local authorities, compulsory health and pension funds, the army, police and so on. Their conclusion is that annually each Slovak pays on average 3,910 euros to cover the cost of the state. Anca Dragu spoke to one of the economists, Radovan Durana and asked him - is the Slovak state too expensive?

Radovan Durana: Compared to wages in Slovakia, the costs of the Slovak government are quite high, especially when we check the development of these costs. We have to say that in the past 4 years the price grew by 25%.

Anca Dragu: I had a look at your webpage and according to your figures the Ministry of Education is one of the most expensive institutions. At the same time there is a lot of talk about poor funding for schools and teachers have low salaries.

RD: If we treat education as one sector then we find out that it is one of the biggest employers. There are more that 60,000 people working in education in Slovakia. This alone sets a high need for funding. There are so many schools at each grade. The problem is allocation. It’s similar to the situation in healthcare where there is a lot of money but their proper allocation is missing. Another problem is that the education consumers, the students, are not really interested in effectivness as long as they don’t see it necessary to pay for their education.People use to say that education in Slovakia is for free but this is not true because when we divide these expenditures we see that it costs almost 300 euro per person per year. Once students would be forced to pay directly, because they now pay indirectly [via taxes], they would care much more about effectivness.

AD: We have heard so much about plans to build technology centers around Bratislava. Slovakia and Austria have even applied to host the European Center for Technology. But at the same time, according to you figures, Slovakia invests more in agriculture which counts for only 4.7% of GDP than it invests in research and development.

RD: It is not so easy to change this situation because most of the expenditures of the Ministry of Agriculture are funded from the European Union. This question should be addressed to people in Brussels, why the European Union supports more the agriculture than the education and research.One the other hand many researchers in Slovakia have kept the habits of previous times when they received funding even without attempting to have scientific results. There is a lack of cooperation with the private sector which would be interested in making research funding effective.

AD: Have you ever calculated how much [public money] goes on perks?

RD: On our website we have gathered information from the media about purchases of different ministries which we think were not ethical. If they weren’t done the money could have been spent better on covering the deficit of the pension system for example or investing in the healthcare system. We’ve launched this database last November and have calculated that in the past 6 months about 10 billion Slovak Crowns [335 million euro] were spent ineffectivelly. We will run the database for the whole year and then we publish a report on how much money could be saved if the public administration hadn’t spent them ineffectivelly.

AD: But how much do ordinary Slovaks really care about how public money is spent? It’s the story of all countries in Eastern Europe that people think that they can’t control those in power anyway so why should they bother?

RD: It’s true that most people do not care but that’s the reason why we’ve launched this project. If we want to change the status quo we must let people know. Uninformed citizens are an easy prey for populist politicians. We plan to go to schools and give a series of lectures on how public money is spent so youngsters entering working life know that nothing is for free in life.