Czech National Budget Council chair: Nationalising ČEZ is an expensive and unnecessary nonsense

The nationalisation of ČEZ, included in the draft policy statement of the emerging government formed by ANO, SPD and the Motorists, is expensive and unnecessary nonsense. Mojmír Hampl, chairman of the National Budget Council, said this today on Czech Television's Questions of Václav Moravec programme. In his view, without further measures it would not lead to changes in the energy price's commodity component. He does not understand the plan in the context of this year, when energy prices are no longer rising significantly.

"We will take steps to gain 100% control over generation within the ČEZ Group. The share buyback will not be financed through state budget expenditure, but by ČEZ itself buying back its own shares," the coalition said in the draft statement, seen by ČTK.

ANO deputy chairman Karel Havlíček said in recent weeks that the move would take around one to one-and-a-half years and cost roughly CZK 250 billion. The current cabinet has long criticised the plan.

Hampl pointed out today that the state receives income from ČEZ dividends, amounting to up to CZK 20 billion a year. The state would therefore lose this money if it nationalised ČEZ.

"The motivation is to have 100% control over ČEZ," believes former finance minister Miroslav Kalousek.

"What ČEZ is has repeatedly been wrongly described here. ČEZ is a private company listed on the stock exchange, in which the state exercises its ownership rights under private law while also having very strong regulatory mechanisms under public law," he added. Although, by his own admission, he has too little information to reject the plan to nationalise ČEZ fully, he is certainly not in a position to recommend it.

Analysts approached by ČTK also oppose the nationalisation of ČEZ. According to Capitalinked.com analyst Radim Dohnal, for example, the move would leave the company heavily indebted, while the resulting lower profitability would make it unable to finance the construction of new nuclear units. "Corruption and nepotism would flourish. It would complicate the environment for other electricity producers and sellers. It would be the beginning of the end of capitalism in the Czech Republic," Dohnal told ČTK on Friday.