Prague - Housing benefits paid by the state to the poorest frequently don't reach their destination. Instead, they end up with private owners that buy houses designated for the impoverished, in particular in Romany ghettos.
Two Czech NGOs, People In Need (Člověk v tísni) and Socioklub, claim that this kind of money making is an easy business. What the enterpreneur needs to do is to buy an estate from the municipality where socially marginalized people have been evicted by the local authorities.
The Czech government's office is said to be aware of the problem.
Flawed attitude of authorities
The NGOs´ representatives explained that the opportunity to exploit the poorest in this way emerges whenever municipality authorities try to solve the problem of socially excluded in the easiest way; that is by evicting them to low-cost council housing.
These estates are subsequently sold to private owners. The reasoning behind is such houses cannot be financed by local authorities, as it would be discriminatory against the rest of the society.
"The first thing the new owners do is raise the rents," Tomáš Hirt of Plzeň's branch of People In Need says.
The monthly rent for one-room flat without a toilet and kitchen in Předlice locality may reach up to CZK 10,000 (EUR 400).
"The owners are aware of the fact nobody else will rent a flat to these tenants," Hirt adds. "These people are deprived of free movement in the housing market."
Running into debt
The socially marginalized cannot afford to pay high rents, so the new owners often lend them money. In this way, the tenants become the house owners´ debtors and although the tenants´s income is not high, it is stable and regular thanks to the monthly social benefits.
As soon as the tenant cannot pay his debts, the house owner applies for a distraint on the debtor´s social benefit, which is then paid to the owner as the tenant´s monthly rent as long as the debtor is alive.
Ghettos as milking cow
"These state funds dissappear, it is a disaster," says head of the Socioklub Petr Víšek.
"Ghettos become a milking cow that get the state budget money to the hands of private owners," Miroslav Brož of the Socioklub describes the unfortunate situation.
At the moment state authorities are not able to prevent this kind of exploitation from taking place.
Law change needed
"The ideal solution would be to amend the law and ban the option of authorizing the distraint on social benefits with the exception of alimony," Hirt claims.
The Agency for Social Inclusion newly established under the Government´s Office may be of help soon.
"We take the amendment of the current legislation as one of our primary goals. Nothing can change without that," says director of the agency Marek Podlaha. However, no law can be amended with haste.
Furthermore, the agency has been waiting for more proposals for the law amendment, as one proposal would not be enough to achieve the covetted law change.