Croatia: Government’s Social Welfare Moves In Shocking Contradictions – “If You Are Hungry And Poor, You Will Sign!”

Croatian Kuna

 

The Social Democrat led government is the one that boasts about looking after the poor, the socially endangered and disadvantaged citizens – the best (?).
One was tempted to believe it a week or so ago, at least partially when the government announced it would forgive debts to the poorest. In a measure considered by some as innovative and unorthodox, the Croatian government has gotten creditors on board a plan to erase the debts of some 60,000 poorest citizens. The “fresh start” scheme targets less than 1 % of the entire debt, but is hoped to boost the economy in the long-term, although no precise calculations or forecasts have been delivered. Given that it’s election year in Croatia this measure although great news for the poor who will qualify for the erasure of their debt, may well be seen as populist political move to score some points for the utterly unpopular Social Democrat government, which might as soon as this European Spring face its destiny at early general elections (regular elections are due end of 2015). Certainly those who have labelled it innovative might not be aware or have forgotten that austerity measures such as mortgage debt relief – governments paying banks to forgive debt on mortgages as e.g. in the US or stimulus cash payments to citizens as in Australia during the Global Financial Crisis of late 2000’s etc.
The measure was voted for by the Croatian government on January 15 and came into force on Monday 2 February and will be implemented until 30 June2015. To be eligible to participate debtors must have no savings or property, have a debt no greater than about $5,100, have no assets, and live on welfare or an income of no higher than $138 per month (about 20% of average net wage) per household member.

We assess that this measure will be applicable to some 60,000 citizens,” Deputy Prime Minister Milanka Opacic (also minister for social welfare and youth) said as she introduced the bailout in late January. “Thus they will be given a chance for a new start without a burden of debt.”

It’s expected that some $31 million worth of bad debts will be written off by creditors, who have signed up to the government’s scheme – buying the debts etc. Those include several banks, telecommunication companies, major utilities, several major cities and municipalities as well as the government’s own tax agency. None will be refunded for their losses.

The program would return access to bank accounts to about 20% of the 317,000 (out of 4,4 million population) Croatians, whose accounts were frozen in July last year due to debts. “This is the first time that any Croatian government is trying to solve this difficult problem and we are proud of it,” Prime Minister Zoran Milanovic said recently at a cabinet session.

And now, if one looks further into the poverty and social welfare pathways in Croatia one comes across extreme contradictions to this benevolent and rather good act of forgiving the poorest people certain debts i.e. debts of up to $5,100 they cannot pay off.

If you are hungry and poor, you will sign,” were the awful and deplorable words directed a couple of days ago by a Ministry of social welfare official in Zagreb, Croatia, at a woman who approached the office with an application for the so-called “guaranteed minimal social welfare payments”. The woman complained, that is, about the part of the application form which states that the person in receipt of minimal social welfare must sign to, in effect, hand over to the government the ownership (title) of the only property the applicant has! I.e., must agree that the government depart will enter a claim to the property on the title deed. Croatian media report that there are more and more similar cases.

While means testing is the usual order of the day for welfare payments eligibility in the developed world one gets quite a shock discovering that Croatia’s government actually demands rights over social welfare payment applicant’s real estate property. Social welfare payments are not loans one needs collateral or guarantees for. Such moves of demanding rights over the applicant’s only property would suggest that this governments social welfare policy also includes measures of making the poorest even poorer and this, to my view, cancels out many positive attributes one might credit the debt forgiveness with.

And so, this same government that has ruled on debt forgiveness to a large number of the poorest with no property, goes about fleecing off or registering claims against the last property of the poorest citizens that turn on its doorstep seeking social welfare payments! No points scoring here Social Democrats! Ina Vukic, Prof. (Zgb); B.A., M.A.Ps. (Syd)

Comments

  1. Zrinka Stampalia says:

    Dear Ina,
    I have so much respect for you and your blog, because you are always on a target!!! This Social Democrat led government is full of tricks and lies!!!
    Major American TV Channels spread the news about ‘Croatian Government generosity and humanistic feeling for own poor populations forgiving their debts’, but always is The Catch – what Americans always know, when they hear the news ‘too good to be true’. But, first moment, when I heard the news from American TV, I thought: Look, now that ‘Kukuriku’ Coalition nailed it!!! Now everybody will voted for them!!! They are ‘Populist’ like Chavez used to be and had all poor Venezuelans with him, and destroyed so prosperous Country to rubbles.
    Now after reading your blog I found out that ‘Kukuriku’ Coalition is so sneaky and they are trying to steal last property from poor Croatian (aprox. 85% Croatian are own property, that is one of highest percentage in the world, I think) by blackmailing and tricking own people who are in financial troubles!!! I am so ashamed and always in fears about any news from Croatia!!!

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    • It begs the question, Zrinka, why would a Social Welfare want to register a claim against a property of a poor person seeking welfare payments. Isn’t welfare there to simply help is the person has no income means, no property to sell etc… I cannot fathom this one – except it makes me feel terrible.

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  2. Reblogged this on Anno Domini 2015 / News.

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  3. Do you ever think we are going to have WWIii? I am worried. You are doing so much to make the world better. Genocide can’t be proved and yet I remember when they found mass graves. Keep up the great job you are doing my friend. Hugs, Barbara

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    • Yes I do think about it, Barbara, although the way things are panning out to alarming levels of discontent almost everywhere one fears such a war might be territorially much larger than the two WW before. It’s up to us to try and point out the obvious wrongs and help prevent utter revolts. Thank you, Barbara, you too and your writings contribute much to the flow of peace

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  4. I think the clue for all this “good will with a catch” from the government might lie in the fact that companies like Telekom (privately owned) were apparently going to forgive the debts of the very poor and not be reimbursed for it. I can’t imagine any private company agreeing to do that without some kind of recompense. So maybe the government made a deal to hand over a certain amount of private property to these benevolent companies and state owned corporations. It’s a win win really. They figure the poor are so desperate to rid themselves of what they perceive to be a large debt, that they will be running in to sign away their property so that they can qualify. The government ends up looking good and possibly winning the next election, and the corporations end up with real assets (bricks and mortar) as opposed to a bad debt.

    Gotta give it to the ex-communists. They have outdone themselves this time.

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    • Simply bad, Anna – it’s almost at the stage when the poor should think twice before signing a form for social welfare du to risk of losing their only property or roof over their head…yep, the ex-communists have nasty tricks up their sleeves still

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  5. wow this is sad!

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  6. Dear Ina,
    This is unacceptable. The money to be “given” to help the poor is money that belongs to the people. The people pay taxes and what they have is theirs. A government cannot levy taxes and also take their possessions away from the poor. It looks as though the government is trying to make a profit using the poor. In fact, it looks like a scam. They are defrauding the poor!
    Love to you Ina.

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    • Totally agree, Michelline. Taxes are there so we all benefit in one way or another. The banks provide the so-called equity loans whereby they give money against the value of property and when the person passes away the banks take what’s owed to them. This practice is a business transaction but this with social welfare and government is another kettle of fish – awful one at that.Love back 🙂

      Liked by 1 person

  7. Politicans we need them but should we trust them.

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