Regional democracy in the Slovak Republic

Rapporteur: David SHAKESPEARE, United Kingdom,
Chamber of Regions, Political Group : EPP/CD

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EXPLANATORY MEMORANDUM

I. INTRODUCTION

1. According to Article 2.3 of Statutory Resolution (2000) 1 of the Committee of Ministers of Council of Europe, the Congress shall prepare reports on the situation of local and/or regional democracy in the member states and in states which have applied for membership, on a regular basis1.

2. The state of local and regional democracy in the Slovak Republic has already been the object of a report, Recommendation 88 and Resolution 109 adopted by the Congress in 2001. The decision to prepare a second monitoring report on regional democracy in the Slovak Republic was taken by the Congress Bureau on 3 November 2004 given the need of evaluation of the situation of regional democracy since the setting up of the self-governing regions in 2001. The present report carries out a revision of the current features of regional democracy in the Slovak Republic, identifies the most problematic issues and points out the major changes that are now in progress. It includes some conclusions and recommendations with a view to improving the situation of regional democracy in the Slovak Republic in the light of relevant Council of Europe principles, especially drawn from European Charter of Local Self-government and the Helsinki Declaration on Regional Self-Government.

3. Mr David Shakespeare (United Kingdom, EPP/CD) was appointed by the Institutional Committee of the Chamber of Regions as Rapporteur to prepare and submit the report on Slovakia to the Congress. In carrying out his task, the Rapporteur was assisted by Prof. Angel-Manuel Moreno, consultant (Spain), member of the Group of Independent Experts on the European Charter of Local Self-Government, and Ms Irina Blonina (Secretariat of Congress). The Congress monitoring delegation paid two visits to the Slovak Republic on 31st January -1st February 2005 and on 18th -19th May 2006. The one-year break between two visits was justified by the need to assess the implementation of the new 2005 legislation on fiscal decentralisation and by the fact that regional elections were held in November 2005. During the visits the Congress monitoring delegation conducted several interviews with top officials of the central administration, Presidents of some Slovak regions, the Mayor of Bratislava, members of the Slovak delegation to the Congress, members of the National Parliament, representatives of the Association of Towns and Municipalities of Slovakia (ZMOS), experts and NGOs (for detailed programmes of the two visits see the appendices). The present report was prepared on the basis of the information received during two on-site visits of a Congress monitoring delegation to the Slovak Republic, as well as all necessary extracts from the relevant legislation and other information and documents provided by the representatives of the Slovak authorities and experts.

II. ANTECEDENTS: MAIN DEVELOPMENTS CONCERNING REGIONAL DEMOCRACY IN THE SLOVAK REPUBLIC (2001-2005)

4. Some antecedents should be mentioned for a better understanding of the present situation. The most important are the following:

a) A political, comprehensive programme for decentralisation

5. Regional democracy in the Slovak Republic has experienced a radical change in the last years. From the stage of a strong unitary country, it has evolved to a decentralised one. The reform has been conducted on a comprehensive basis, developing at the same time the local and the regional layers of government. During this period, the Slovak Republic has carried out a comprehensive project of global reform of public administration, on which decentralisation is a key element. The government then in power made explicit its intention in a strategic political document, called the “Concept for decentralisation and modernisation of public administration”, supported by all the parties in the cabinet and approved by Resolution of the Council of Ministers of the Republic of Slovakia (N° 230, of 11 April 2000). Most of the developments that took place afterwards have been anchored in that strategy. The final target was to have a streamlined government, territorially divided in three layers: (a) State administration, with a central organisation and a deconcentrated one; (b) the regional layer; and (c) the local authorities.

6. At that time, the situation of local and regional democracy in the Slovak Republic was the subject of a report by the Congress in May 2001 (CG (8) 5 Part II). Following that report, Recommendation 88 (2001) and Resolution 109 (2001) were adopted.

b) Reforming the Constitution

7. Although the creation of Regions (or “Higher Territorial Units”, HTU or “Upper Territorial Unit”) has been foreseen in the Slovak Constitution since 1992, the Magna Carta was amended in 2001 with the purpose, among others to help introduce regional democracy in the country. The final result of the voting for the constitutional amendments in Parliament showed a radical split opinion: out of 148 Members of Parliament (MP) present, 90 (the required minimum) voted for the amendments, 57 against and one MP did not vote. The governing coalition, which had 92 MPs after the last general election, lost only two votes, but the opposition, namely the Movement for Democratic Slovakia (HZDS) and the Slovak National Party (SNS) voted against the amendments. The President of the Republic eventually promulgated the revision on the Slovak constitution on 8 March 2001.

8. The Constitution of the Slovak Republic contains basic provisions, setting up a level of regional self-government in Articles 64, 65 and 69 (which deal at the same time with local and regional self-government). Namely, the Constitution foresees the future creation of “a higher territorial unit”, the details of which will be laid down by a law (Article 64a). Furthermore, Article 65 depicts the Higher Territorial Units (regions) as legal persons “which manage their own property and their financial means independently, under the conditions laid down by a law”. They will “finance their needs primarily from their own revenues and also from state subsidies”. Furthermore, Article 69 of the Constitution lays down the basic institutional organisation of the regions (see infra, point 3.3).

c) The law on the Higher Territorial Units, HTU (regions)

9. By Resolution N° 736, of 20 September 2000, the Council of Ministers of the Republic of Slovakia asked the Minister of the Interior to submit, before 31 March 2001, a draft Law on the decentralised administration of the “higher territorial units” (“HTU”), which is the technical name given to the regions. Consequently, by the end of the year 2000 that Minister sent a Draft Bill on the matter. In the summer of 2001, the National Parliament approved the Law of the HTU: Act of 4 July 2001. The Bureau of the Congress adopted an opinion on this Act on the basis of a draft prepared by Prof. Jean-Marie Woehrling, member of the Group of Independent Experts on the European Charter of Local Self-Government. This opinion carried out a complete analysis of this piece of legislation, and reference is made to it for a full account of the Act2. There was also a reaction of the part of the Committee of Ministers of the Council of Europe3.

d) The regional elections

10. In the summer of 2001, the National Parliament approved the law on regional elections. The Act No. 303, of 4 July 2001, called for elections to the self-governing regional bodies. The first regional elections to be held in Slovakia’s history took place on 1st December 2001.

11. In November 2001, at the request of the Slovakian authorities, the Bureau of the Congress took the decision to observe the regional elections. As a result of that activity, on 20 December 2001 the Bureau adopted the report on the observation of the first regional elections held in the Slovak Republic, 1 December 20014. The Congress delegation concluded that the elections had been free and fair. As a result of the elections, 401 representatives in total were elected as members of the several regional councils. These elections experienced a very low turnout of voters: 26% of electoral participation in the first round and 22% in the second one.

12. The second regional elections took place in November 2005. One noticeable aspect of these elections was once more the very low electoral participation. The average voter turnout was 11,07%, with the highest turnout of 16,19% in the Region of Nitra, and with the lowest in Trencin, with only 7,12%.

13. This is a serious situation, which deserved concern on the part of many officials and regional leaders interviewed by the Congress monitoring delegation. According to the Slovak authorities, several factors might explain this state of facts:

      - In general, the public has not fully understood the role of regions
      - The absence of tradition in the field of regional democracy
      - Little knowledge on the political position and competences of the regions
      - General passivity in electoral processes, as evidenced by low participation in other elections, for example 17% in the elections to the European Parliament

In any case, the situation is considered unsatisfactory by the Slovak authorities. This is also the opinion of the Rapporteur who recommends taking the measures to reinforce the participation in the regional elections and the awareness of the citizens on the role of regions, as well as on their citizen’s rights and duties.

e) The process of establishing the regions

14. After the elections in December 2001, the governing bodies of the Regions were established and took up their functions. The autonomous regions started their activities in 2002. During the first two years, the process of establishment was progressive. Different laws were enacted to set up a full and comprehensive statutory framework of the regions (see infra). The transitional period finished in late 2003. January 2004 marked the beginning of the full life of the regions.

III. OVERVIEW OF THE CURRENT SITUATION OF REGIONAL DEMOCRACY IN THE SLOVAK REPUBLIC

15. In the light of the present legal scheme, the key aspects of regional autonomy in the Slovak Republic may be summarised as follows:

a. Statutory scheme for regional democracy

16. The Act of 4 July 2001, on the self-government of the “higher territorial units” is the basic statutory regulation of the regions. The Act was amended several times in 2003, 2004 and 2005. According to top Slovak officials, the amendments took place on the basis of several proposals made by the presidents of the regions, and were inspired by the experience gained by the application of the law during the last four years. The Act – in the English version- depicts the HTU as “autonomous (samospravny) territorial self-government and administrative unit of the Slovak Republic”. The Act establishes eight HTU: the region of Bratislava, with the seat in the city of Bratislava; the region of Trnava, with the seat in the city of Trnava; the region of Trencin, with the seat in Trencin; the region of Nitra, with the seat in the city Nitra; the region of Zilina, with the seat in Zilina; the region of Banska Bystrica, with the seat in Banska Bystrica; the region of Kosice, with the seat in Kosice; and the region of Presov, with the seat in the city of Presov.

17. The Act of 4 July 2001 defines the Higher Territorial Unit as a legal person that, under the conditions laid down by a law “manages its own property and revenues independently, ensures and protects the rights and interests of its inhabitants” (Article I, Section 1-5). Its territorial district can only be changed by a law (Article I, Section 1-4). As for the institutional organisation, the Act develops the constitutional provisions and says that the region is endowed with directly elected organs: an Assembly or Council (Art. 1, Sect.11) and a “Head” or President (Art.1, Sect.16). All these provisions, plus the fact that regional self-government is regulated by the Constitution, should be understood to be in full compliance with the core concepts and common principles on regional self-government endorsed by the Conference of European Ministers responsible for Local and Regional Government (hereafter “the Helsinki Declaration”) (principles A 1.2, A 1.3 and B9).

18. Furthermore, the Act lists a group of competences of the regions (Art. 1, Sect. 4), thus fulfilling principle B 1 of the Helsinki Declaration. It also rules that the regions do possess some kind of own resources (Art. 1, Sect.10: “a self-government region shall finance its needs mainly from own resources as well as from state subsidies”), an aspect which is dealt with by principle B 11 of the Helsinki Declaration. The regions are endowed with rule-making power (Art. 1, Sect.8: “generally binding regulations”, as amended in 2006) an aspect which is covered by principle B 1.2 of the Helsinki Declaration. They can develop a strong trans-frontier co-operation, by the subscription of the appropriate agreements, and even become a part of international associations (Article 1, Section 5) an important provision which is just in line with the requirements laid down in principles B 6 and B 7of the Helsinki Declaration.

19. On the other hand, the regions may be delegated the discharge of duties corresponding to state administration (Art 1, Section 6 as amended in 2006: “some tasks of local state administration may be transferred to a self-government region”), an aspect which is in line with the provisions of the Helsinki Declaration (principles B 1.3 and B 1.4). Finally, the Act establishes that the regions have their own administration (Article I, Sections 20 and 21) a provision that consistently follows the requirements of principle B 10 of the Helsinki Declaration.

20. The Act of 4 July 2001 is not a comprehensive “code” of regional government. Instead, its scope is limited, laying down the basic elements of the institutional profile of the regions. In many key features of the regions’ institutional regime, the Act refers to other pieces of legislation: the Act on the property of the HTU (dealing with the transfer of state property to regions); the Act on the elections of organs of the HTU; the Act on the allowances and salaries of the Presidents of the HTU; the Act on budgetary rules of territorial self-government; the Act on budgetary determination of the yields from the income taxes of the territorial self-government; etc. In spite of its limited scope and content, the Act establishes a set of autonomous regional entities whose legal regime largely complies with the key principles of the Helsinki Declaration.

b. The number and size of the Regions (HTU)

21. The number, size and capital of the several regions were largely the most critical issue for political discussion during the process of establishing the regions. The proposal of the Government was to create twelve HTU, following a model connected with political and historical background. The government proposal was supported by many people, the vast majority of local authorities, experts and NGOs.

22. In any case, this aspect of regionalisation was a hot issue during the political debate of the governmental proposal. The debate on the number and size was also pervaded by technical terminology (especially the EU Regional Policy terms, such as “NUTS” -Nomenclature of Territorial Units for Statistics) or by political questions (especially, the possibility or political willingness to have a region along the territory of the Hungarian minority). A long and sensitive political debate followed the presentation of the Government’s proposal. Finally, the Act of 4 July 2001 (described supra) divides the Slovak Republic into eight self-government regions, using the same territorial basis as the governmental regional offices created in 1996. The final decision seems to have been the result of a compromise between historical and economic consideration, but the Parliament changed the sense and spirit of the proposal.

23. The Act establishes the regions according to a model that appeared to be mostly connected with technocratic guidelines than with with real, historical or natural borders. These features rendered the whole regionalisation process a bit technocratic and cold. A good example is the name chosen for that bodies: “Higher Territorial Units” (HTU), “Upper territorial Units” of “Upper territorial wholes”, according to the different translations in the documents used by the Congress monitoring delegation , instead of using “Regions” or any of the names that the regional instance has had in Slovak history. It is noteworthy to state that the title of the Act of 4 July 2001 uses the terminology “self-government of the Higher Territorial Units”, but is also uses the word “regions” in points 1 and 2 of Section 1 of Article 1.

24. If the regional leaders and political officials met by the Congress monitoring delegation seemed to be rather satisfied with the resulting situation, the general feeling is that natural regions have been split into rather technocratic units. Some officials consider that the current regions are not homogeneous, and they do not form a coherent picture. Real administrative centres are missed, and the borders of the current regions do not follow the natural, historical lines. Some politicians told the Congress monitoring delegation that the optimal number of regions would be 16, based on the traditional župan or old territorial districts, while others endorsed other numbers, such as 12. There is no general consensus on this issue

25. In any case, the Congress monitoring delegation got the impression that the question of the number and size of the regions is from now on totally closed and fixed, since the government does not have in its political agenda the project to change the number or the basic features of the present regions. On the other hand, the fears of the Hungarian minority that they could be somehow dissolved in the resulting territorial picture of the regions were largely dissipated by the very good electoral results of that minority in the regional elections of 2001, where the Hungarian Coalition Party and other fractions got a proportion of seats in the regional councils of Nitra, Trnava, Banska Bystrica and Kosice much higher than the size of the minority in terms of inhabitants. In total, the Hungarian Coalition Party obtained 84 of the 401 seats available in the different regional councils.

26. The only remaining problem seems to be the status of Bratislava, and the possibility for the capital city to become a HTU (region) in the future. During the first visit in February 2005 the Congress monitoring delegation collected contradictory versions. For instance, the Mayor of Bratislava strongly supported that possibility (see, infra) on the basis of the particular features of the city. On the other hand, the president of the Bratislava Region, amongst others, expressed his satisfaction with the current situation, since he considered that the city is not big enough to be a region by itself.

c. Political organisation of the Regions

27. As said above, article 69 of the Slovak Constitution lays down the basic institutional organisation of the regions, consisting of “the representation of the upper territorial unit” (the Council of the Region) and “the head of the upper territorial unit” (the President of the region). The members of the council -the representatives - shall be elected for a four-year term. Elections of the representatives are to be performed on the basis of free, universal, equal and direct suffrage by secret ballot. The council approves the budget of the Region.

28. For what concerns the “Head” of the region (the President), he is also elected by the inhabitants of the territorial district, on the basis of a universal, equal and direct suffrage by secret ballot for a four-year term. The elections are organised on a two-round model. In the first round, the candidate obtaining more than 50% of the votes is appointed to the office of president. If this is not the case, a second round is organised, in which the victory goes to the candidate that gets the higher number of valid votes. In each region, the President is elected independently from the Regional council. He is not a member of it, but he chairs the meetings of the council. The president of a Region can appoint deputies. The relations between the president and his deputies and the possibility of delegating presidential responsibilities have been ruled by the 2005 amendments to the Act on HTU.

29. The head is the executive authority of the region, the political leader and its “visible head”. He performs the management of the regional organisation and resources. He is also the natural representative of the Region. Therefore, the institutional framework of the region follows the national tradition of double legitimacy: at the local level (Mayor and Council are elected directly and independently), at the regional level (Presidents and Councils of the regions) and at the national level (President-Parliament).

30. The presidents have a veto power, but the council may overrule the president’s veto if it votes in favour of the proposal for the second time. Each council can approve its own code of procedure, and they can establish in an internal regulation the procedural requirements, steps and phases of their decision-making process, including the handling of a veto from the president of the Region. Presidents’ and councils’ majority do not always belong to the same political party.

d. Competences and responsibilities. Scope of self-government

31. The competences that the regions exercise today belonged basically to the central State administration in the past. This level of government transferred a high number of competences (around 400) to the local and regional level through a multi-year period of time. Decentralisation was performed through a dual-level (albeit simultaneous) process, composed of five stages. The powers were transferred from the State to the regional and/or the local layer, according to the territorial or economic scale of the competence at stake. For instance, in the domain of education: (a) local governments are responsible for primary schools and preliminary “fine arts” schools; (b) regional governments are responsible for secondary schools, conservatories and “upper fine arts schools”; (c) the central government is responsible for the Universities.

32. The process was conducted by the Ministry of the Interior, and took place mainly between 2001 and 2003. The transfer implied not only the nominal or formal conveyance of the competences, but also of infrastructures, personnel and resources. However, some leaders met by the Congress monitoring delegation expressed their views that in that period the competencies were actually transferred, but the funds and the human resources to discharge such competencies were not transferred in the same amount.

33. The Act on HTU points out the main domain of responsibility of the regions (article 1, section 4) but does not enumerate their precise competences. For instance, letter “b” of section 4 says that the region will “carry out planning activities” relating to its own territory, but does not describe what concrete plans are to be approved by the region. The concrete definition as to the actual powers to be transferred to the regions does not seem to have raised too much political controversy, as the heart of the debate focused on the issue of the number and size of the regions.

34. Today, the regions have a fair share of powers, basically in the domain of economic management and regional development, education, schools, culture, transportation. The Slovak system is a “symmetric” one, in the sense that all the regions have the same legal status and the same and homogenous share and number of powers. As in many other countries, HTU´s competencies may de divided into original and delegated by State. The most important original competencies of regions are the following ones:

      - regional planning and development
      - transportation (they own and maintain roads of the second and third class)
      - healthcare (they own and run hospitals of the second category)
      - social affairs (they run some kinds of social services having supra-municipal scope, such as retirement homes, social services for children, etc.
      - education (they run secondary schools)
      - cultural services (galleries, museums, theatres, some types of libraries)
      - participation in civil protection,
      - licences for pharmacies and private physicians

35. Furthermore, each region may enact regulations on regional taxes, fees, healthcare system, regional services and so on. Although regions are commonly perceived as having the primary task of regional development, the management of the European Union structural funds is performed by the central administration.

36. As far as delegated competences are concerned, the regions execute some tasks transferred from the state administration (for example, a part of the competencies in education, health system, road transportation, etc).

37. The process of transfer of powers is widely considered to be finished by now. New transfers of powers from the central government to the HTU are not foreseen in the near future. Most regional leaders and officials met by the Congress monitoring delegation expressed their views that the number and share of regional competencies is rather satisfactory. In general, all the people met by the delegation declared to be fairly satisfied with the current level of competencies of the HTU. In the Rapporteur’s view, the share of powers attributed to the regions clearly satisfies the requirements of the Helsinki Declaration and the regular comparative standards in European practice.

e. Relations with State Administration. Controls

38. In practice, Slovak regions act as rather autonomous territorial units, free from day-to-day guidance or prior approval or consent from the central instance. Under strictly legal terms, the central government cannot give orders to a region, but it can forward it suggestions or recommendations. Decisions adopted by the regional executive may be challenged directly in courts of law, and there is no mechanism of inter-administrative supervision. There is no expediency control or appeal before the state administration. The system of external control is, consequently, a purely judicial one.

39. The Slovak authorities told the Congress monitoring delegation that so far there is practically no inter-administrative litigation, and challenges in courts of regional activities by central administration are very infrequent.

40. However, the activity of the regions may be controlled by different forms. First, there is a possible control from the General Prosecution Office of the country. Also, there is the case of different forms of inspections and controls carried out by the Supreme inspection office, and the financial audit. Finally, there is an internal control, since the council of the region appoints a controller. This specific feature is regulated by article 1, section 19 of the Act of 4 July 2001. In the exercise of delegated competences from the state administration, there is room for the central administration to issue guidelines or to check the manner of how the region is exercising that competence.

41. As from 2004, the State deconcentrated Administration (the so-called “local state administration) has been drastically modified. The old, integrated regional or district offices were abolished and a network of sectorial offices of state administrations was put in place. Ministries have territorial offices (Interior, Environment, etc.) in all regions.
For instance, the Ministry of Construction and Regional Development has offices in every Region for the management of the cohesion and structural funds which need to be spent in the region. These Regional offices have a vertical responsibility to the sectorial minister.

f. Finances

42. The statutory framework for the financing of the regions is to be found at section 9 of the Act on the HTU (as amended in 2005). Namely, the second paragraph of this provision (as amended in 2005) states that “the self-government region financially covers its needs first of all by its own income, subsidies from the state budget and other resources”.

43. The funding of the regions has evolved in the last five years, along the lines of the process of creation and establishment of the regions. In the period 2002-2004, the regions were mainly financed by direct subsidies from the central administration. Later, a specific chapter in the budget of the central administration was created, in order to deal with the relations with HTU. As the different competences were transferred to the regions, there was a parallel reduction in the budgets of the affected ministries, and the resources were also transferred to the region. Progressively, the central administration increased the freedom of HTU in the use of those grants. In 2004, the money sent to the regions from that special chapter in the central budget was not “purpose bound” anymore.

44. The financial system of the regions has been completely renovated as from January 1, 2005, following some new legislation approved in 2004, which is supposed to strengthen the autonomy of the regions. The new statutory scheme is basically composed by the following laws and regulations:

      § Act No 564/2004 Coll. of Acts on budget determination of income tax yields to regional self-government and on amendments and supplements to certain laws
      § Act No 583/2004 Coll. of Acts on budget rules of the regional self-government and on amendments and supplements to certain laws.

45. In the new financing system, it is estimated that proportion of regional own revenues has reached up to 60%, while in the old system this proportion was only 7%. The basic sources of funding for the regions are:

- (1) Regional tax. The only source of genuine, own revenue for the region is a tax on motor vehicles. This tax hits corporate cars, since there is no tax on private, personal cars in Slovak Republic. The tax is calculated on the basis of the power of the car. The money collected on the basis of this tax no longer goes to state budget. Furthermore, regions enjoy a certain degree of discretion to fix the rate of the tax, since they can define it by themselves, within certain limits.

-(2) A proportion in income tax. The regions get a proportion of the money collected by the central government on the basis of the income tax, which is a national tax. The proportion and calculation of the income tax yields have been dramatically modified by the new legislative scheme. The participation in this tax on the part of local and regional government has been strongly increased in the last year, parallel with the process of decentralisation.

46. The share of the regions in the income tax global collection is stipulated by the law (Act. No. 564/2004), and not decided by the regions. The total fiscal effort for the income tax is divided into the following headings:

      - 70,3% goes to the Municipalities
      - 23.5% goes to the Regions
      - 6.2% remains in the State budget

47. Then, the total sum of this 23,5% is allocated among several regions. For this purpose, the system uses a complex set of criteria and coefficients related to statistical and empirical data for each region, each one having a different weight in the final formula. The Congress monitoring delegation was told that these criteria had been discussed and agreed at the political level, and they are connected to the devolved competencies. The criteria are the following ones:

      · the number of inhabitants with permanent residence in the region (15% of weight)
      · the number of citizens between the age of 15-18 (15%)
      · the number of citizens being older than 62 (32%)
      · population density of the region (9%)
      · roads of the second and third class in the region (20%)
      · Area of the region (9%)

48. The next step in this complex calculation involves the application of several factors and coefficients that are supposed to work as a redistribution and horizontal equalization, and for solidarity purposes: each one of the eight regions has its own coefficients for the years 2005-2006-2007 and 2008. For instance, the region of Bratislava has the coefficient 0,7592 for the year 2006, while the region of Banska Bystrica has the coefficient of 1,0849. In practical terms, the effect of those coefficients is simple: poor regions get more money than the sum which is actually collected in its territory, while rich regions get less than the money actually collected.

49. The central tax administration collects all the taxes on personal and corporate revenue. Afterwards, the state severs a part of the total collection, and divides it into eight parts (according to the number of regions). The central administration then transfers a percentage to the regions. Once transferred, the regions may decide freely how they spend this money.

50. In general terms, the fiscal reform is seen in an overall positive way, and with moderate optimism. The regional politicians are in general satisfied with the results and consequences of the fiscal decentralisation. However, some regional leaders considered that this situation is unfair, since each region should receive a part of the central tax collection in proportion of the money collected in that region (fiscal effort). In their view, problems remain in the financing of some services and infrastructures, such as public transportation and hospitals.

51. The central government expects that the product of the tax will increase, as economic growth is foreseen. The forecasts and projections of the Ministry of Finance for the period 2005-2008 say that the new system should give regions enough financial resources for the discharge of their duties. However, if there were an important deviation from the predictions made, the government would react by increasing the regional participation in income tax.

52. Government officials believe the current system is fair and overall good, and it is proportionate with the share of competencies and responsibilities of the regions. The system is also seen positively by the regions. The fiscal effort has been higher than expected, so the regions have received more money than it was planned. Regions are apparently happy with the new system, as the Congress monitoring delegation did not hear from any specific complaint on this field on the part of the presidents of the regions. It is important to stress the fact that the money transfers are not “ear-marked”, that is, the once the regions receive the money they can freely decide on which item it should be spent.

53. As for the recourse to debt, regions can ask banks for money and sign loan contracts. Regions are not strictly controlled as to the opportunity of the loan, but budgetary rules are very strict. Regions can not allocate more than 25% of the annual, regional budget for the payment of the instalments of the credit.

54. In addition to those regular elements of regional finances, the regions may also apply for funding to the central government in connection with a specific project, which may be financed by the state alone or within the framework of the structural funds of the European Union. In that respect, the territorial units for the purpose of the EU Cohesion funds are following ones: the whole Slovak Republic is a NUTS I, two or more regions form a NUTS II, and one single region is a NUTS III.

55. In this respect, the Congress monitoring delegation was informed at the Ministry of Construction and Regional Development that European funds constitute an additional source for the financing of regional (and local) services and infrastructures. The interaction between the local, regional and central levels of government works as follow:

      - Local and regional governments submit projects to be financed totally or in part by the aforementioned funds.
      - The final responsibility for the selection of projects to be financed with European funds belongs to the central administration (Ministry of Construction and Regional development).
      - There is an inter-administrative council, where representatives of the regions are somehow involved in the evaluation and selection process
      - Thus, the regions have a small participation in the selection of projects, while the spending and management of those funds is the sole responsibility of the central government.
      - The Congress monitoring delegation was informed about the existence of some proposals to increase the role of the regions in the management of the EU structural funds, which could be in force in 2007

56. Some of the regional leaders met by the Congress monitoring delegation expressed satisfaction with the current situation of financial autonomy of the regions, while others complained. In any event, all were expecting an improvement of the situation due to the full implementation of the new regime, which started in January 2005. Financial decentralisation has fuelled regional government. However, it seems that the current system only covers satisfactorily the operating costs of the regions, but it has not yet solved the problem of investment costs.

g. Association of Regions

57. Before the visits of the Congress monitoring delegation, the Slovak regions have not established a specific organisation or association to promote the common interests of the regions, apparently on the grounds of some political or legal obstacle. Furthermore, it would be inconvenient from a political perspective to have one regional president being appointed as President of such an association.

58. The officials and leaders met by the Congress monitoring delegation at ZMOS (Association of Towns and Communities of Slovak Republic) said that this national association offered the regions to become a member of it. The idea was to have a chamber of regions but regional leaders refused to join. Notwithstanding this fact, the presidents of the eight regions established first a sort of informal meeting or conference, commonly called the “Club of the eight”. Later, the informal “club of eight” was transformed into a true, formal association, with its own legal status. The association was indeed registered as such during the development of the second visit. The presidency rotates every six months, among the different presidents of the regions. The association was established with the aim of becoming an interlocutor with the Parliament, the mayors and ministers with respect to decentralisation. The councils of the regions have authorised the respective presidents to enter such agreements.

59. As for the councils of the regions, they have not established any form of association, conference or permanent co-operative structure.

h. Transfrontier co-operation - International action

60. Regions are allowed to perform transfrontier co-operation. They are free to enter into agreements with other regions and they notify the central government after the signing of the agreement. Transfrontier cooperation seems to be very active at regional level, especially in the area of the Carpathians.

61. On the other hand, most regions have their own representative office in Brussels, and in the future it is expected that there will be a building for all the regions in Brussels. The regions are adequately represented in the delegation of the Slovak Republic to the Committee of the Regions of the European Union. This delegation is composed of 6 representatives of the regions, and 3 of the local government

i. Relations with Local Self-Government

62. An overall complaint of the politicians and officials met by the Congress monitoring delegation in Bratislava is that the current Slovak territorial system consists of three somehow watertight compartments or layers of government: the central administration, the regions and the local level. The regions and local self-government have both contacts with the central one, but they do not have relations between each other. There is no institutional, operative or financial relation between the regional and the local governments. The co-operation and communication between these two levels of government is very weak.

63. On the other hand, the regional and local layers of government have the same hierarchy, none is superior to the other, and there is neither superiority nor subordination. However, in some respects the local instance has a sort of natural subordination to the regional decisions, as in the domain of planning, for instance (the city planning has to respect regional planning). The respective competences of regions and towns seem to overlap sometimes, according to one regional leader met by the Congress monitoring delegation.

64. It should be pointed out that some city mayors are at the same time members of the Council of the region. For instance, in the Region of Trnava the council has 40 members, 15 of which are at the same time mayors of cities of the region. Under Slovak law, it is possible to be, at the same time, a mayor, a Member of Parliament and a member of the regional council.

j. Miscellaneous

- Consultation and participation

65. Some of the political leaders met by the Congress monitoring delegation said that the central government had consulted the regions in regards to the different legislative proposals. For instance, the officials met at the Ministry of Regional Development told the delegation that the national concept of territorial planning was elaborated by the state with the comments of local authorities. Top civil servants told the delegation that at the central level that there is an advisory body to the government, where the regions are present. In the framework of that advisory body, documents are sent to the regions for comments by the central administration, and there are joint meetings between their representatives.

-Human resources

66. Currently, the regions have their own staff, which is independent from the central bureaucracy. All the people working for the regions are civil servants at the regional level, except in the case of teachers. The regions have their own salaries. HTU have autonomy to hire and dismiss their own civil servants and employees.

- Questions that remain open

67. The Congress monitoring delegation perceived two recurrent issues during the visits. On the one hand, the regional self-government in the Slovak Republic does not trigger the amount of popular interest and support that it should do. Many people still do not fully understand the role of the regions in the new decentralised country. This is probably one reason that helps to explain the low participation rate in the last regional elections. The situation is expected to improve, as the regions will be taking important and progressive responsibilities in the day-to-day life.

68. On the other hand, another debated issue concerning the territorial definition of the current regions seems to be the role of Bratislava. What is more, the Mayor of Bratislava told the Congress monitoring delegation about a legislative proposal to make Bratislava a HTU. He supports the view that Bratislava is not a regular city, due to the well-known contradictions and shortcomings of every big capital city. The current situation is unsatisfactory for the local leaders of the capital, especially for what concerns the finances. The proportion of money granted to Bratislava on the basis of its “official” permanent population is not in accordance with the reality of the services demanded by its de facto population and visitors.

IV. CONCLUSIONS AND RECOMMENDATIONS

(A) Conclusive assessment

69. The Slovak Republic has made an important effort in the domain of decentralisation over the past six years. For what concerns regional self-government, it may be said that the Slovak system deserves an overall positive assessment, in the light of the Slovak Republic’s recent history (especially the post-war period), taking into consideration the political and social context of the country, and with due attention to Slovakia’s size, population and current political priorities. The current regionalisation process in the Slovak Republic seems to be a fair, sensible and reasonable arrangement responding to a delicate balance between the need to be in line with European standards on territorial organisation and the historical unitary character of the country.

70. In the light of the Act of 4 July 2001 and its supplementary laws and regulations, the Higher Territorial Units in Slovakia may be perfectly considered as true regions, therefore largely meeting the criteria for regional self-government set out in the documents of the Council of Europe (Helsinki Declaration on Regional Self-Government), and in the light of comparative experience in Europe. On the other hand, the transfer of competences from the central instance to the regional (and local) one, as well as the establishment of a sensitive and delicate fiscal decentralisation has been accomplished in a very reasonable time and with a notable expediency.

71. The regional instance of government is nowadays fully accepted by all political parties. The process of regionalisation is irreversible, and the regions constitute a stable and developing layer of government. Inter-governmental litigation is almost non-existent, and there are no major conflicts between the central and the regional governments. Of course, there are still discussions on issues such as the number and financing of the regions, but the whole idea itself is not called into question. In the general perspective, the process of regionalisation can be considered very successful.

(B) Recommendations

72. As any new system establishing a new territorial system and approach in the handling of public affairs, the Slovak experience in the domain of regional decentralisation may be streamlined and improved. From that perspective, some suitable recommendations could be the following ones:

i) The Slovak Republic should be encouraged to continue the progress and initiatives taken so far, in order to consolidate and deepen regional democracy. In particular, it should be encouraged to pursue the legislative efforts already accomplished, aiming at strengthening regional authorities.

ii) It would be desirable to carry on the process of fiscal decentralisation and to increase the financial autonomy of the regions, so that they are able to cover not only operating expenses, but also to perform a comprehensive program of investments.

iii) It would be very convenient to reinforce the technical capacity and the managerial abilities of the human resources of the regional authorities. The training of civil servants at the regional level should be the object of a nation-wide program of technical education, so that they are fit to satisfy the challenges of the regional governmental activity.

iv) Some links should be created between the regional and local government, so that they can develop joint development strategies and co-operative efforts.

v) The interest of the people towards the regions should be enhanced, maybe through an institutional information campaign. Participation should be seriously encouraged, in order to improve the poor electoral turnout registered in the 2001 and 2005 elections.

vi) Specific Coordination structures (for instance, bilateral bodies) should be set up between the state administration and the regional one, in order to provide a solution to the lack of coordination in some fields such as social affairs and education.

Appendix

Monitoring report on regional democracy in the Slovak Republic–
first official visit, 31 January – 1st February 2005

Programme

Monday, 31 January 2005

8:30 – 8:45 Welcome in ZMOS (Association of Towns and Communities of Slovak Republic) by Milan MUŠKA, Executive Vice-President, and Dr Olga GÁFRIKOVÁ

8:45 – 9:45 Meeting with Jozef LIŠKA, Director General of the Public Administration Section, Ministry of Interior, with participation of Dr Gejza PETRÍK, Director of the Local Government Department, and Dr Dusán SVEDA, Director of the Legislative Department

9:45 - 10:45 Meeting with Peter TOMEČEK, President of Trnava Self-Governing Region, member of the Congress

11:00 – 12:00 Meeting with Lubo ROMAN, President of Bratislava Self-Governing Region

12:15 – 13:45 Lunch break

14:00 – 15:00 Meeting with Stanislav BERNÁT, Head of the Slovak Delegation to the Congress, Vice-President of the Congress, and other members of the Slovak Delegation:

Štefan ŠTEFANEC, President of Trenčín Self-Governing Region
Ladislav LUMTZER, Mayor of Košice - Dargovských hrdinov
Ferdinand VÍTEK, Mayor of Nitra

15:15 – 16:15 Meeting with Andrej ĎURKOVSKÝ, Mayor of Bratislava, with participation of PhDr. Branislav HOCHEL, First Deputy Mayor of Bratislava

16:30 – 17:30 Meeting with Emil KUCHÁR, Director of the Human Rights Department, Ministry of Foreign Affairs, with participation of Peter BIRCAK, Deputy Director, and Juraj KUBLA

Tuesday, 1st February 2005

9:00 – 10:20 Meeting with Viktor NIŽŇANSKÝ, Plenipotentiary of the Government for the Decentralisation of Public Administration, Government Office of the Slovak Republic, with participation of Jaroslav PILÁT, Consultant

10:30 – 11:15 Meeting with Michal SÝKORA, President of ZMOS, with participation of Alexander SLAFKOVSKÝ, Mayor of Liptovskský Mikulas, member of the EU Committee of the Regions

11:30 – 12:15 Meeting with Josef MIKS, Head of Department, Division of Financing Public Expenditure, Ministry of Finance

12:30 – 13:30 Lunch break

13:45 – 14:45 Meeting with László GYUROVSZKY, Minister of Construction and Regional Development

          with participation of Monika JÁVORKOVÁ, Director of EU Assistance Section, Emil JAMRICH, Director General of the Section of Regional Policy, and Július SLOVÁK, Director General of Regional Development Support Agency

15:30 – 17:00 Meeting with the Parliamentary Committee for Public Administration Issues, National Council of the Slovak Republic:

          Milan HORT, Chairman of the Committee (SDKU – Party of Democratic and Christian Union)
          Miroslav ČIZ, Vice-Chairman of the Committee (SMER)
          Katarína TOTHOVA (HZDS – Movement for Democratic Slovakia – People’s Party)
          Renáta ZMAJKOVICOVA (SMER)
          Karol MITRIK (SDKU)
          Iván FARKAS (SMK – Party of Hungarian coalition)
          Pavol ABRHAN (KDH – Christian and Democratic Movement)
          István PASZTOR (SMK)
          Ivana JALCOVA, Secretary of the Committee

17:15 – 18:00 Meeting with Luba VAVROVA, Local Government Development Center

Monitoring report on regional democracy in the Slovak Republic

Second official visit (Bratislava, 18-19 May 2006)

PROGRAMME

Thursday, 18 May 2006

09:00 – 10:00 Ministry of Construction and Regional Development

          Meeting with Ms. Vladimira OLLEOVA, Director General, Section of the Strategy of the Regional Development

10:30 – 12:00 Ministry of Finances

          Meeting with Ms. Alena NEMCOVA, Head of the Public Administration Budget Division, and Mr. Josef MIKS, Head of Department for Budgetary Regulations and Financial Analyses of the Regional and Local Government


15:00 – 16:00 Meeting with members of the Slovak delegation to the Congress (Chamber of Local Authorities)

        Mr. Stanislav BERNAT, Mayor of Martin, Head of the delegation
        Ms. Anna NEMCIKOVA, Mayor of Gelnica

16:30 – 17:30 Meeting with Mr Viktor NIZNANSKY, Plenipotentiary of the Slovak Government for decentralisation of the public administration

Friday, 19 May 2006

8:30 – 9:30 Meeting with representatives of the Association of Towns and Communities of Slovakia (ZMOS)

          Mr. Milan MUSKA, Vice-President and Director General
          Mr. Jozef MRVA, Vice-President
          Mr. Boris TONHAUSER, Head of International Relations Department

10:00 – 12:00 Meeting with Presidents of the Self-Governing Regions:

          Mr Gabriel AGARDY, Vice-President of the Region of Bratislava

    Mr. Tibor MIKUS, President of the Region of Trnava

          Mr. Frantisek SEBEJ, Member of the Regional Parliament, Region of Bratislava

13:00 – 14:00 Ministry of Interior

          Meeting with Mr. Jozef LISKA, General Director, Section of the Public Administration, with participation of Dr Gejza PETRÍK, Director of the Local Government Department, Dr Dusán SVEDA, Director of the Legislative Department, and Mr Frantisek PAULINY, State Advisor, Organizational and International Co-operation Department

 15:00 – 16:00 Meeting with Prof. Milan BUCEK, Chair of the University of Economics, Department of Public Administration and Regional Development, Member of the Group of independent experts on the European Charter of Local Self-Government

1 The Slovak Republic joined the Council of Europe in 1993. It ratified the European Charter of Local Self-Government in 2000, with some reservations, which came into force in respect of the Slovak Republic on 1st June 2000.
2 Doc CG/Bur (8) 57
3 Report on the self-government regions in the Slovak Republic, [Doc. RAP-LOC (2002)1]
4 Doc CG/BUR (8) 99, Rapporteur: Mr Martin Haas

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