Gov't endorses scheme to write off debts of destitute citizens

Photo /Vijesti/2015/siječanj/15 siječanj/JKP_2591.jpg

The Croatian government on Thursday adopted an agreement to write off debts of the poorest citizens whose outstanding liabilities do not exceed HRK 35,000 and who have neither pecuniary means nor assets to pay them off.

The government took into account primarily the social criterion and the scheme is to cover some 60,000 citizens who had overdue liabilities to state-owned utility providers, such as the HEP electricity company or the national broadcaster HRT, as well as debts to private creditors such as banks or telecom operators.

Social Welfare Minister Milanka Opacic said at the government meeting that this "will be a new start for some 60,000 citizens" whose accounts have been frozen for over a year, and who have ended up in this dire situation due to a protracted recession.

According to her explanation, this is a consensual agreement and banks, telecom operators and utility companies of four major cities will now join it.

"I hope other cities will join the agreement too and accept the criteria," she added.

The minister underscored that this agreement was a one-off measure, and that the government would not repeat it.

The justice ministry is preparing a mechanism, that is a law on consumers' bankruptcy aimed at safeguarding citizens against such a situation, Opacic said.

Prime Minister Zoran Milanovic said the agreement proved the humaneness of his cabinet.

"People should pay their bills, but if they find themselves in deep trouble, this measure can help," Milanovic said, boasting that no previous government had taken such a measure.

Households without savings and assets whose monthly income in the last three months did not exceed HRK 2,500 and individuals living alone whose monthly income did not exceed HRK 1,250 are eligible for debt write-off.

Under the scheme, the ceiling for the debt write-off towards telecom operators is 10,000 and the ceiling for writing off debts incurred towards state-run utility services is HRK 25,000.

(EUR 1 = HRK 7.6)

(Hina) ms