Finance Ministry Freezes Hospital Debt Clearance

Following the decision of President Ivan Gasparovic to halt the transformation of hospitals into joint stock companies, the Ministry of Finance led by minister Ivan Miklos has frozen around EUR 40 million that was earmarked for clearing the debt of hospitals.

The future of hospital wards? (c) Roman Whuke

Miklos justifies the move by saying there is no real reason to continue bailing out the debt of hospitals using state money if the transformation process has been stopped, reports Hospodarske Noviny. The EUR 40 million is the last part of a massive EUR 350 million rescue injection package for hospitals, subject to their conversion from subsidised organisations into joint stock companies.

A special commission made up of health and finance ministry civil servants was supposed to decide on the allocation of the money, but now the Ministry of Finance could even try to call the money back. The Ministry had already agreed with the impatient creditors to waive penalties and provide discounts, so the latest decision of the Ministry of Finance could rock the boat, with the hospitals being the ones with no lifebelts. After all, they are committed to settlement agreements already signed with creditors.

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