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National Reform Programme 2017

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National Reform Programme 2017 Ministry of Finance of the Slovak Republic National Reform Programme of the Slovak Republic 2017 April 2017 Contents 1 Identification of challenges in the Slovak economy ................................................................................. 6 2 Implementing the measures under the National Reform Programme 2016 ............................................. 8 3 Macroeconomic framework and medium-term forecast ......................................................................... 16 4 Planned measures in structural topics ................................................................................................... 18 4.1 Fiscal policy and public finance ..................................................................................................... 19 4.2 Education, science, and innovations ............................................................................................. 23 4.2.1 Regional education........................................................................................................................ 25 4.2.2 Tertiary schools ............................................................................................................................. 27 4.2.3 Science and research .................................................................................................................... 27 4.3 Employment and social inclusion .................................................................................................. 29 4.3.1 Employment .................................................................................................................................. 32 4.3.2 Social inclusion.............................................................................................................................. 33 4.4 Transport infrastructure ................................................................................................................. 35 4.5 Modernization of public administration and the business environment ......................................... 38 4.5.1 Modernization of public administration .......................................................................................... 40 4.5.2 Business environment ................................................................................................................... 42 4.6 Health ............................................................................................................................................ 44 4.7 Environmental sustainability and energy ....................................................................................... 48 5 EU cohesion policy ................................................................................................................................ 50 6 Institutional framework for the Europe 2020 strategy and NRP ............................................................. 52 Annex 1: National targets under the Europe 2020 Strategy and other indicators ........................................ 53 2 List of Boxes Box 1: Pilot assessment of the effectiveness and efficiency of the public employment services ................ 31 Box 2: Local government efficiency ............................................................................................................. 39 Box 3: Healthcare spending review …………………………………………………………………….………….45 List of Figures Figure 1: Performance indicators, standard deviation from the sample average (OECD/EU) ....................... 6 Figure 2: Disaggregation of performance indicators by means of supplementary indicators, standard deviation ........................................................................................................................................................ 6 Figure 3: Contributions to GDP growth in Slovakia, 2012 - 2020 (in pp) ..................................................... 16 Figure 4: Structure of consumer inflation - y/y accruals of CPI components (in pp) ................................... 16 Figure 5: National fiscal rules (index) .......................................................................................................... 20 Figure 6: Medium-term budgetary frameworks (index) ................................................................................ 20 Figure 7: VAT gap (% of potential revenue) ................................................................................................ 21 Figure 8: Effective corporate income tax rate (tax collected from the net operational surplus) ................... 21 Figure 9: Expenditure on education, 2013 ................................................................................................... 23 Figure 10: Wages of primary school teachers as a ratio of average wage of employees with tertiary education (2014) ......................................................................................................................................... 23 Figure 11: Inputs and outputs of R&D as % of V3 average ......................................................................... 24 Figure 12: PISA testing results (average score) .......................................................................................... 24 Figure 13: Quarterly development of the unemp. rate ................................................................................. 29 Figure 14: Long-term unemployment (%, 3Q 2015, 3Q 2016) .................................................................... 29 Figure 15: Relationship between unemployment and the job vacancy rate in time (Beveridge curve) ........ 30 Figure 16: Relationship between unemployment and the job vacancy rate in districts (March 2017) ......... 30 Figure 17: Low-skilled workforce in the labour market (%, 2015) ................................................................ 30 Figure 18: Unemployment rate of women by age groups (%, 2015) ........................................................... 30 Figure 19: Expenditures of the MoTC SR and the organisations set up by the MoTC SR on transport (EUR million) ......................................................................................................................................................... 35 Figure 20: Capital expenditures of NDS and ŽSR + availability payments in the PPP projects (EUR million) .................................................................................................................................................................... 35 Figure 21: Construction of motorways and highways in Slovakia (km) ....................................................... 36 Figure 22: SSC´s expenditures (EUR million) and condition of the class A roads...................................... 36 Figure 23: Annual rail network utilisation rate .............................................................................................. 37 Figure 24: Unit costs of rail carriers (average for 2013-2014, EUR)............................................................ 37 Figure 25: Comparison of areas in the DB ranking (standard deviation from the OECD average) ............. 38 Figure 26: Number of days necessary for enforcing liabilities out of contracts and resolving insolvency .... 38 Figure 27: Disposition time in days, civil and commercial matters, 2014 .................................................... 39 Figure 28: Clearance rate in V4, civil and commercial matters in %, 2010-2014 ........................................ 39 Figure 29: Current public expenditure on healthcare, 2015 (% of GDP) ..................................................... 44 Figure 30: Amenable mortality, 2013 (standardized per 100 thousand inhabitants) ................................... 44 Figure 31: Healthcare efficiency of the OECD countries ............................................................................. 45 Figure 32: Liabilities of 13 teaching and university hospitals operated by MoH SR (millions EUR) ............ 45 Figure 33: Municipal waste recycling ratio ................................................................................................... 48 Figure 34: Average exposure of population to PM2.5 in µg/m3 (2013) ....................................................... 48 Figure 35: Drawing of structural funds and the Cohesion Fund, the second PP 2007-2013 (EUR million, 2016 value provided above the figure) ........................................................................................................ 50 3 Summary The National Reform Programme of the Slovak Republic 2017 (NRP) describes the structural measures that the Slovak government plans to implement in the next two years. The new complex approach to the identification of priorities taking into account GDP, as well as other life quality aspects, identified the labour market, the healthcare system and the primary education as the biggest challenges of the Slovak economy. In 2016, 54 thousand of new job positions were created, the second most successful year in the Slovak history, and the unemployment rate dropped to lowest level since the end of 2008 (9 % in the fourth quarter 2016). Measures focusing particularly on the decrease in long-term unemployment rates should result in further decrease in unemployment. Therefore, job seeker profiling, personalised consulting and new active labour market policies (ALMP) will be introduced within the public employment services. Furthermore, expansion of childcare facilities for children up to three years of age and flexible employment of mothers
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