Due to EU reservations, less money will go to social housing

Prague - The Ministry for Regional Development will probably allocate much less money for social housing this year than the planned 1.3 billion crowns. The reason is the opinion of the European Commission, which classified the funding programs for protected and social housing in the Czech Republic as illegal state aid. Grant recipients thus face the risk of having to return the funds, which the MMR does not want to risk, Deputy Minister for Regional Development Miroslav Kalous said today in response to a CTK inquiry.
    "At this time, we have information from the European Commission that these programs should be subject to illegal state aid. This means that the recipients of the grant would have to return it," Kalous said. According to Kalous, the Commission's decision is surprising, as the same programs were run in previous years without objections.
    The Commission's criticism concerns two MMR programs. The first supports social housing for families whose income does not exceed 1.4 times the subsistence minimum. Funds from the second program are intended for so-called protected apartments. "These are, for example, homes with care services, nursing homes, or halfway houses," Kalous said.
    The Commission's spokesperson told CTK only that it was informed about the project at the end of November and that no decision had yet been made. "We are in regular contact with the Czech authorities," said the spokesperson, but did not comment on the details of the negotiations. She reminded that state aid should be granted only after the EC approves that it does not affect competition.
    Last March, the EU summit approved the doubling of the ceiling for state subsidies that the Commission does not have to approve. Until then, it was 100,000 euros over three years; now it is 200,000 euros.
    According to the Czech representation to the EU, this concerns two support programs for providing grants to municipalities and entrepreneurs for the construction of rental social housing for income-restricted citizens. The European Commission requested additional information on January 10, spokesperson Jan Vytopil told CTK. He said that the Czech side would conduct technical consultations with representatives of the EC's Directorate-General for Competition in the coming weeks.
    In total, the ministry has prepared 1.3 billion crowns in the budget for both programs. "We have not yet announced those programs, and we do not want to risk that the recipients would have to return the money," Kalous stated. According to him, the MMR now has two options. Either to completely halt the programs or significantly reduce the amount of funds disbursed to fall below the threshold for illegal aid. MMR, according to Kalous, is now leaning towards this solution.
    A recipient cannot receive more than 200,000 euros (5.6 million crowns) in three consecutive years. "This means that financial support will be significantly lower," Kalous stated.
    There is still the possibility that the programs will run at their full amount. "We will try to convince Brussels that support for social housing is not illegal state aid," Kalous added.