Comprehensive pension reform with a gradual increase of the retirement age to 67 years, further tax and administrative relief, continuation of the functional integration of hospitals, and the establishment of a national children’s hospital and a national university hospital, a new law on the salaries of civil servants and employees – these are some of the measures from the National Reform Program adopted by the Government on Thursday.
Prime Minister Andrej Plenković identified three key goals of this document: strengthening the competitiveness of the economy, linking education with the labor market, and the sustainability of public finances.
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“We want this document to be a catalyst for numerous reforms in 2018 and in the first half of 2019,” said the Prime Minister.
He believes that now is the right time to implement structural reforms, as ministers know what the strategic priorities are, we have economic growth and good macroeconomic indicators, and there are no elections scheduled for this year.
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The National Reform Program is a document of nearly 130 pages, planning 59 measures in 11 reform areas.
Finance Minister Zdravko Marić highlights two main directions of reform in his department – further strengthening of the budget framework and planning, and the continuation of tax reform.
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The continuation of tax reform is aimed at further administrative and tax relief, and Marić announces that a complete package will be designed and presented to the Government by the summer break, and in the fall it would go to the Parliament to come into effect on January 1, 2019.
In the legislative framework, he announced strengthening the role of the State Audit Office, the adoption of a new law on fiscal responsibility, and a law on the budget, which is planned to be adopted by the end of the year.
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The Ministry of Labor and Pension System plans a comprehensive pension reform, and Minister Marko Pavić reassures citizens, stating: ‘No one will go from work to the grave or work until exhaustion, but the goal is to maintain the sustainability of the pension system and implement measures that will ensure the adequacy of pensions.’
He wants to extend the working life, Pavić said, supporting this with data that only 19 percent of retirees have a full working record of 40 years, and that there is only 1.19 employed persons per retiree.
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The Minister of Labor also announced a reform of the employment service. The focus will also be on the long-term unemployed and marginalized in the labor market for which, as Pavić said, significant funds from the European Social Fund, amounting to 13 billion kuna, are available.
He also announced a new law on the salaries of civil servants and employees, aimed at increasing productivity, rewarding the best, and sanctioning the worst.
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Minister of Public Administration Lovro Kuščević announced that after the law on civil service is adopted, regulations on job title classification and evaluation will also be adopted. The goal is for civil servants to finally be rewarded or sanctioned for their work or lack thereof. “We believe this will lead to better and higher quality work of civil servants,” said Kuščević, who also highlighted digitalization projects, reducing state agencies, etc.
Justice Minister Dražen Bošnjaković stated that the fundamental goals are to create a system in which cases will be resolved faster in court and to reduce the number of unresolved cases. “Last year, we managed to reduce the number of unresolved cases from about 450,000 to just over 400,000, and in the next period, we expect even stronger reductions,” he said.
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He also emphasized the importance of a set of laws related to better evaluation of judges’ work, more efficient and faster appointment of judges and state attorneys, and the continuation of the fight against corruption where the legal framework will be changed and improved, etc.
At the beginning of next year, a new law on social care should come into force, announced Minister for Demography, Family, Youth and Social Policy Nada Murganić, who among the activities in her department announces the continuation of integration and management of social benefits and better targeting of vulnerable groups to reduce the risk of poverty among the most vulnerable groups – children, the elderly, and persons with disabilities.
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Murganić also highlighted measures for co-financing the construction of kindergartens and the activity “kindergartens for a Harmonious Life,” along with the introduction of shift work in kindergartens and new programs and employment in kindergartens.
Health Minister Milan Kujundžić emphasized the continuation of the functional integration of hospitals as a basic measure in health care, and identified the need to establish a national children’s hospital and a national university hospital in Zagreb as one of the main goals of the Government and the state, thereby preserving the core of top medicine.
Among the 27 activities planned in his department, he highlighted the attempt to lower the prices of medicines and equipment through consolidated procurement, informatics control of consumption and treatment outcomes, and promoting health tourism, especially considering the great interest of investors from around the world in investing in health tourism in Croatia.
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Measures in the field of education and science are aimed at linking education with the labor market, and Minister of Science and Education Blaženka Divjak emphasizes four major areas – curriculum reform of general education, educational curriculum reform of vocational education, relevance of higher education, promoting excellence in science, and linking with the economy.
Along with the experimental phase of curriculum reform in 72 schools, Divjak also emphasized the reform of vocational and dual education, the establishment of about 20 competence centers in five areas, and the engagement of around one billion kuna from two European funds, promoting the retention of young scientists in Croatia, rewarding excellence, and encouraging cooperation with the economy.
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The activation of state property and the reduction of the state portfolio in commercial companies are activities that the Ministry of State Property is focused on, and for effective implementation, the Government today discussed the final proposal of the law on the management of state property.
“Preparation of 10 major projects by 2020 is planned, ensuring an investment of over 10 billion kuna. The introduction of a unified register of state property and the obligation of medium-term planning in companies of special interest is also anticipated,” emphasized Minister of State Property Goran Marić.
Already this year, the Ministry has ensured revenues in the budget of 700 million kuna and investments of 1.5 billion kuna through the activation of state property. This has not been recorded in relation to the activated portfolio since Croatia’s independence to date, said Marić.
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State Secretary in the Ministry of Sea, Transport and Infrastructure Maja Markovčić Kostelac highlights three areas in which intensive work will be done – railways, the road sector, and maritime transport, with the aim of increasing efficiency, competitiveness, and space for investment.
Minister of Environmental Protection and Energy Tomislav Ćorić highlights the establishment of a legal basis for the implementation of reforms in the water utility sector, which should also mean a reduction in the number of public water service providers. Currently, there are more than 170 in Croatia, and the service level of a good part of them is not at the level that citizens deserve, said Ćorić.
A new law on water services is to be adopted, which, along with by-laws, should create conditions for reducing the number of public providers and thus strengthen their capacities, in order to reduce the losses we have in the water system, which currently average 49 percent.
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Minister of Regional Development and EU Funds Gabrijela Žalac emphasized the need to accelerate the use of funds, simplify procedures, further develop the information system that includes electronic project applications, as well as create mechanisms for responding to user complaints during project application and implementation.
Work is also being done on developing technical assistance for the preparation of large investment projects, and Žalac announced that the Government will present a regulation on the base of development projects next week, which represents the basis for the development of the National Development Strategy of the Republic of Croatia by 2030.
State Secretary in the Ministry of Economy, Entrepreneurship, and Crafts Nataša Mikuš emphasizes that activities in this department will be directed towards administrative relief to enable easier and cheaper business operations for entrepreneurs. The liberalization of the service market will continue, investments in research and development will be increased through tax incentives for the business sector, the consolidation of inspection services is planned, and by the end of this year, a strategy for the digital transformation of the economy will be adopted, etc.
