Money, power, and politics are often closely intertwined and this results in low levels of trust in public institutions, not only in the Czech Republic and other Central and Eastern European countries, but within the EU as a whole, and worldwide. There are a number of corrosive byproducts, including the diversion of public money to private accounts, companies with anonymous ownership structure, and to political parties and interest groups.
Political corruption is present at all levels of government, with impacts ranging from the destruction of the local environment to the embezzlement of public funds, to the proliferation of private interests in policy-making.
We work to tackle these problems by supporting grassroots citizen initiatives that combat corruption and public maladministration at the local level.
We also develop and promote legislative measures to address the problem at the systemic level. We initiate, promote, and monitor legislative and policy changes that prevent political corruption, clientelism, and misuse of public funds. Our work focuses specifically on the responsibility of politicians and public office holders for handling public assets, the abuse of these assets for financing political parties and election campaigns, and the transparency of the law-making process:
Access to Information and Open Contracting
Frank Bold lawyers actively participated in the preparation and promotion of the Czech Act on the Register of Contracts – a transparency measure adopted by the Czech Parliament in late 2015. According to the new Act, any public contract worth CZK 50,000 or more has to be published online in a central contract register, in full text in a machine-readable format, in order to take effect.
This represents an important shift from passive transparency (guaranteed by the Freedom of Information Act) to pro-active transparency, and allows for much wider and active public oversight of the use of public resources and dealings of public institutions. The Czech Act is based on similar legislation in Slovakia.
The new legislation is expected not only to have a preventive anti-corruption effect but also to lead to more effective public spending, better service delivery, increased citizens’ trust in public administration, as well as potentially innovative ways of analyzing and reusing the data from the register by both public and private actors. We continue to monitor the implementation of the Act, and to safeguard it against the industry lobby and other critics trying to gain unjustified exemptions from the newly adopted legislation.
At the EU level, Frank Bold supports a coalition of European civil society organizations promoting public registers of beneficial owners of companies—a measure that would contribute to tackling the issue of anonymous ownership, tax evasion, and money laundering.
Political Party Financing
Money in politics is a matter of topical interest – globally as much as at the national and EU level. The Czech Republic is one of the few member states which have not carried out a reform of political party financing to date, despite repeated criticism by the Council of Europe’s Group of States against Corruption (GRECO). Despite the Czech government’s reassurances, little tangible progress has been made so far. Political parties and election campaigns in the Czech Republic are financed both by state subsidies and private donations. In reality, however, additional income often comes from “tunnelling” of public procurement, EU funds, or “buying” of political decisions. It is impossible to track down the true origin of the money due to the lack of rules for party financing.
Frank Bold advocates increased transparency and independent oversight of funding of political parties and election campaigns, and is actively involved in the process of amending the current legislation. We collect data and publish our analyses, share our findings with both national and international audiences, and participate in both political and expert discussions.
Transparent Legislative Process and Lobbying Regulation
Lobbying, i.e. seeking and exercising influence over decision-making and how policies are created and implemented, is often considered an important and integral part of well-functioning democracies. However, if not sufficiently regulated and transparent, lobbying may become a platform where politics and business connect in a way that sways the decision-making towards private, rather than public, interests.
In 2011, drawing inspiration from examples of good practice abroad and with the support of major Czech anti-corruption organizations, Frank Bold prepared and presented a detailed proposal of a lobbying regulation. Despite the failure to secure the adoption of the proposal, we remain involved in the discussion and are members of the recently formed Czech Committee for the Regulation of Lobbying. We publish relevant studies and policy recommendations.
We are also active advocates of a more transparent legislative process. In the Czech Republic, we helped prepare and push through an amendment to the Chamber of Deputies Rules of Procedure which reduces opportunities for introducing last-minute “riders” into the debated legislation, and increases transparency of the bills preparation. We further support any initiative to make legislative proposals and votes available for independent expert and public scrutiny.
At the EU level, Frank Bold is a member of ALTER-EU (Alliance for Lobbying Transparency and Ethics Regulation)—a coalition of over 200 public interest groups and trade unions promoting lobby transparency across Europe. Currently Frank Bold takes part in the ALTER-EU’s Full Lobby Transparency Now! campaign which aims to improve the quality of EU Transparency Register.
State-owned Enterprises and Independent Oversight
State-owned enterprises are a major vehicle driving corruption in the Czech Republic. The state assets in these companies are equal to approximately two thirds of the annual income of the state budget. Yet, there is little or no control of how these assets are managed: no procurement regulation for state-owned enterprises, no binding requirements for state companies’ governance, no binding rules for the appointments to their management and supervisory boards.
In 2011, Frank Bold opened a public discussion on this issue and prepared proposals to bridge these gaps. Since then, we have been pushing for more efficient oversight of state-owned enterprises—for example, by changing the supervisory board composition, introducing a state ownership policy, adopting transparent nomination procedures for positions on the state companies’ boards, or by extending the powers of the Supreme Audit Office so that it can audit public assets in state- and municipality-owned companies, as is common in most EU Member States.
To support our advocacy work on concrete legislative proposals and recommendations, we collaborate with partners from the Czech Republic, Poland, and Slovakia to prepare and publish reports, case studies, data analyses, and examples of international best practices.