SaS Raises Concerns Over Misuse of Funds in Social Enterprises

Bratislava, 2 September (TASR) – Social enterprises, as currently structured, raise suspicions of public fund misuse, Freedom and Solidarity (SaS) MPs Vladimir Ledecky and Martina Bajo Holeckova stated at a press conference on Tuesday. The MPs criticised the high proportion of "soft activities" such as training, analyses, and workshops in funded projects. They also pointed to potential abuse of the reduced 5-percent VAT rate on goods and services offered by social enterprises, and the option to defer profits for up to five years. Ledecky expressed concern that these projects may be inefficient. „It is alarming that more and more money is being spent on soft activities. With around 600 social enterprises in Slovakia, millions are being spent inefficiently with minimal benefit,” he said. He also raised issues regarding the employment of people with disabilities. While enterprises must declare such employment, they are exempt from actually doing so for the first 12 months, giving them an unfair advantage in tenders. Another concern is the ability of winning enterprises to subcontract work, potentially bypassing rules intended to support disadvantaged groups. Bajo Holeckova cited the example of AMG Security, a company with social enterprise status, which won a contract from the Ministry of Labour, Social Affairs and Family for €1.1 million. She claimed that, due to subsidies amounting to 33 cents per euro of revenue, the ministry will ultimately pay €1.5 million – €315,000 more than the next-lowest bidder. Labour Minister Erik Tomas (Voice-SD) dismissed the MPs’ claims as “incompetent and false”, demanding an apology from them. He noted that AMG Security was granted the social enterprise status in 2021 during the term of SaS’s own coalition government. „Since 2021, this company has been winning tenders across various institutions, including the Bratislava City Authority. If Bajo Holeckova's theory holds, it would implicate numerous state and municipal officials, including [Bratislava] mayor Vallo,” said Tomas. Holeckova further criticised the ministry's €6 million subsidy to the Alliance for Social Economy in Slovakia (ASES), an organisation founded by Voice-SD MEP Branislav Ondrus. She questioned both the use of the funds and possible political ties. Minister Tomas defended the grant, stating that ASES is an umbrella organisation representing 200 social enterprises nationwide, not a direct beneficiary. In its response, ASES also rejected the MPs’ accusations. „We strongly object to the damage to our reputation by opposition politicians who have not verified basic facts,” ASES said. The group called it absurd to link Ondrus's past civic activity, while employed at the European Commission, to political corruption. ASES asserted that it does not employ members or officials of Voice-SD and confirmed it currently works with Ondrus at his own initiative, as he is Slovakia’s only member of the European Parliament's Committee on Social Economy. „If Mr. Ledecky fulfils his four-year-old promise to establish a similar committee in the Slovak parliament, we would gladly cooperate. To date, neither he nor Ms. Bajo Holeckova has contacted us in any way,” underlined ASES. mf