The Slovenia Times

Parliament Debate Shows Entrenched Opinions on Privatisation



The session, the third dedicated to the topic in the current parliament, was held at the request of the United Left (ZL), which insists the parliamentary resolution needs to be repealed and a new strategy of management of state assets drawn up in cooperation with all stakeholders.

But the Finance Committee rejected the proposal from the ZL to call off the decision of the National Assembly from 2013 to short-list 15 state-owned companies for privatisation.

Luka Mesec, the ZL deputy group leader, touted a petition against privatisation co-sponsored by his party that has so far collected 11,000 signatures. He said the ongoing privatisation was "neither fair nor useful or voluntary".

His party opposes privatisation in general, but in particular the sale of Telekom Slovenije, by far the biggest company on the privatisation list.

If the state assets are sold in their entirety, this would net around 11 billion euros, and Slovenia would still be left with 17 billion euros of general government debt. "What we will be selling then, we don't know," Mesec said.

Government representatives meanwhile warned that privatisation needs to be carried out in order to protect Slovenia's international credibility, while maintaining that this is not a "fire sale" of state assets.

Dušan Mramor, the finance minister, mounted a defence of privatisation efforts, suggesting that continuation of privatisation was crucial if Slovenia is to retain access to international financial markets.

He said he met 45 investors on the margins of the meeting of the IMF and the World Bank in October, and they wanted to know three things: whether Slovenia is politically stable, whether it will privatise state-owned companies, and whether the budget deficit will be in accordance with EU rules.

Mramor stressed that the list of companies to be privatised was confirmed in parliament in order to satisfy investors who were ready to refinance Slovenia's debt and borrow fresh capital "when the country was practically on the way of Greece".

"Slovenia must continue what it set out to do, including with regard to privatisation...All other debates could very quickly lead us to a situation where we used to be," he said in reference to Slovenia being shut out of financial markets for much of 2014.

Economist Jože Mencinger, who spearheaded the anti-privatisation petition, was adamant that the privatisation plan ought to be scrapped since the situation has changed substantially since 2013.

But Mrak, a renowned economist, noted that credibility has been one of Slovenia's biggest problems and reneging on privatisation could erode its credibility.

Moreover, he said corporate governance was poor. "I don't believe the illusion that we will henceforth manage companies better," he said, noting that Slovenia still needed international financial markets.

Nevertheless, Mrak warned against rushing new lists of companies for privatisation. Slovenia needs a much more serious development strategy which should include privatisation as just one of the instruments.

Deputy Dušan Verbič of the ruling SMC party said that Slovenia's credibility must be preserved, but that privatisation must be very transparent. Marko Pogačnik of the opposition Democrats (SDS) added that the procedure has gone too far and that halting it would be damaging to Slovenia.

Privatisation was also endorsed by Jožef Horvat of the opposition New Slovenia (NSi), and Jani Möderndorfer of the opposition Alenka Bratušek Alliance added that the anti-privatisation hysteria should be stopped. "I'm afraid that someone is scoring political points here."

While Uroš Prikl of the coalition Pensioners' Party (DeSUS) also spoke about Slovenia's credibility on the international markets, coalition Social Democrats (SD) MP and former Finance Minister Franc Križanič said that the parliament was pressured to make such a decision.

The ZL also proposed that expert public and representatives of employees and civil initiatives are involved in the drafting of the strategy of management of state assets, but this proposal was also rejected by the committee.

Finance Ministry State Secretary Metod Dragonja said that the ministry is working intensively on a draft strategy, which will first be presented to deputy groups, and then sent for public debate. A working draft has been already completed but is still labelled as confidential, he added.

Coinciding with the debate, a group of liberal associations today launched a petition in favour of privatisation, which has so far collected over 3,300 online signatures.

While the petition is ostensibly non-partisan, it has been endorsed by the opposition SDS, who have demanded the committee hold an extraordinary session to debate it.

Privatisation has been one of the main topics in the first four months of the Miro Cerar government. The prime minister was initially seen as an opponent, but he has since changed tack and has pledged numerous times that the 15 companies on the initial list would be privatised.

Nevertheless, there have been tensions in the government over the issue, as the Social Democrats (SD) started to backtrack, arguing that the plan should be reconsidered. Commentators attribute the move to the fear that the party is being outflanked on the left by the ZL.

The remaining coalition partners, the SMC and DeSUS insist that privatisation must continue and that ongoing procedures cannot be stopped.


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