Bloomberg News

Czech 2012 Budget Draft Proposes State Job Cuts, Wage Increases

October 04, 2011

Oct. 4 (Bloomberg) -- The Czech government is proposing to cut 7,941 jobs, or 1.8 percent of state employees, while raising salaries for other workers it will retain next year, the 2012 budget draft shows.

The number of people working in public administration would decline to 425,090, according to the budget draft posted on the Finance Ministry website.

The plan “in general can be understood as a measure aimed at making state administration more efficient,” the budget draft said.

The government of Prime Minister Petr Necas has passed legislation overhauling health care and pensions and has sought to streamline budget-making processes to narrow the budget deficit. The three-party Cabinet’s plan has helped attract investor interest, with the country’s five-year bond outperforming similar German debt in the past year.

The allocation for total state salaries in 2012 will rise 845 million koruna ($45 million) to 128.5 billion koruna, the draft shows.

The average public wage will rise 2.6 percent to 23,833 koruna next year, the ministry said in the draft.

--Editors: Douglas Lytle, Alan Crawford

To contact the reporter on this story: Peter Laca in Prague at placa@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net


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