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More rot in the Environment Ministry?

LAST YEAR’S sale of emissions quotas, in which Slovakia sold its excess CO2 quotas for a discount price to a unknown, new company named Interblue Group, is among the biggest controversies swirling around the current government and months after the media and opposition political parties started criticising the deal, the end of the saga is far out of sight. With new information emerging about other questionable contracts signed by the Environment Ministry, even the Prime Minister, who has been reluctant to get involved in the Ministry’s ‘business’ in the past is “taking action”, according to his spokesperson.

LAST YEAR’S sale of emissions quotas, in which Slovakia sold its excess CO2 quotas for a discount price to a unknown, new company named Interblue Group, is among the biggest controversies swirling around the current government and months after the media and opposition political parties started criticising the deal, the end of the saga is far out of sight. With new information emerging about other questionable contracts signed by the Environment Ministry, even the Prime Minister, who has been reluctant to get involved in the Ministry’s ‘business’ in the past is “taking action”, according to his spokesperson.

Environment Minister Viliam Turský is scheduled to have a meeting with representatives of Interblue Group to “reach a mutual agreement about the next steps,” the SITA newswire quoted the ministry’s spokesperson, Jána Kaplanová, as saying. The sales price agreed with Interblue Group may have cost Slovakia up to €75 million in comparison to prices paid to other neighbouring countries for their emissions quotas.

Interblue Group bought Slovakia’s quotas for €5.50 per tonne. According to the annexes to the sales contract, the company would pay €1 more per tonne if Slovakia’s proceeds from the sale were used on green projects such as insulation for housing by the end of 2009.

Prime Minister Robert Fico, who previously defended the contract, said on August 14 that the government no longer agrees with operational terms of the contract and asked minister Turský to tell Interblue Group that no other sales will be made on the basis of this contract.

Later, on August 17, PM Fico said withdrawing from the contract is even a possibility, with the Sme daily quoting his spokesperson as saying this is because of “the atmosphere of the whopper accusations made by the opposition on one hand and the incompetence of the Environment Ministry to defend its steps on the other hand.”

The emissions quotas sale has also moved from the political arena to the police, as criminal complaints have now been filed – the most recent complaint was delivered to the General Prosecutor’s office from Lucia Žitňanská, a parliamentary deputy for the Slovak Democratic and Christian Union (SDKU) opposition party. She charged that the crimes of a public official misusing the competencies of office and of violation of the duties of administering property belonging to others have been committed, the SITA newswire wrote.

“Without an agreement with the other party, the Interblue Group, [Turský] has got no way to get out of this deal without harming Slovakia,” Žitňanská said about Turský’s forthcoming meeting with Interblue Group, as quoted by SITA, adding that if an agreement to cancel the contract is reached, it would suggest a connection between politicians from the ruling coalition and the company.

Meanwhile, the Hospodárske Noviny daily reported on August 13 that the Japanese Embassy in Slovakia confirmed to the newspaper that a Japanese state agency, NEDO, was just a step away from signing a contract for buying the Slovak emissions quotas for a price similar to what it paid to Hungary or the Czech Republic (between €10 and €13). However, the embassy tempered that information later in the day by saying that there were some talks between NEDO and the Slovak government but they had not led to any results, SITA reported.

Ashes and Xiland

“The Prime Minister is intensively dealing with issues in the Environment Ministry and is also taking action,” Fico’s spokesperson, Silvia Glendová, said as quoted by SITA. The media has started speculating whether that means the forthcoming dismissal of the minister, who the PM has already called incompetent.

The emissions quotas case is far from being the only environmental pain facing Prime Minister Fico. The Sme daily has written about what it is calling the ‘ashes tender’ under which the state water utility company (SVP), which falls under the supervision of the Environment Ministry, signed a questionable contract for removal and disposal of ash and slag from state-run heating plants in Martin, Zvolen and Žilina with Esco, a Krupina-based company for a total of €85 million over the contract’s six years. Two of Esco’s competitors were excluded from the tender for not fulfilling the tender conditions – one of them, for instance, did not have an approval statement from the ministry regarding the proposed contract. The more expensive of the two competitors’ tender proposals was €27 million cheaper than Esco’s price, Sme wrote.

“The Prime Minister principally disagrees with the execution of this project under the given conditions,” Glendová told the media.

On August 19 Turský told the media that the ‘ash case’ does not even exist, as the contract was never implemented, the TASR newswire reported.

In another emerging case, SVP and the state water-utility’s construction arm rented 300 hectares of land in Jarovce, near Bratislava, for Sk0.50 (about €0.02, a symbolic price) per hectare per year for 99 years to Xiland company to build residential and recreational buildings at the location. According to Sme, Deputy Prime Minister Dušan Čaplovič asked that the activities be stopped and the government agreed.

Local media are suggesting that there are links between Ján Slota, the head of the Slovak National Party (SNS) which has controlled the Environment Ministry since 2006, and the companies involved in all three cases. Neither Turský or Slota, or any official of SNS, commented on the recently reported information.

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