I am certianly not claiming credit but yesterday’s post was followed soon after by the announcement of the new government. As expected the architects of the 4th Republic (the two year period PiS ruled together with Giertych and Lepper) have taken on the so called power ministries (defense, internal affairs, justice) and will pursue imaginary foes.
On the other hand the economy ministries have been taken by sensible, and indeed surprising people given PiS’s populist stance. A new super ministry of development has been created/ proposed which will oversee the ministries of trade and industry and others (but NOT the ministry of finance). The new minister will be Mateusz Morawiecki currently CEO of one of the largest banks – BZWBK (previously owned by AIB and now Santander) with Jerzy Kwieciński as deputy minister (the only deputy to have been announced yesterday). I first got to know Jerzy back in 1993 on the EU PHARE funded export promotion programme. He is highly articulate and knows Brussels inside out. So it does look as if in line with expectations PiS is not interested in controlling the economy. We will wait to see how things actually work out.
The past couple of days have been frustrating and only in part because of the Polish election result. My main bugbear has been the inability of being able to talk to a human being who is willing and able to help and in dealing with the consequences of regulations dreamed up by idiots who clearly would not be able to hold down a normal job.
The first frustration concerns the Polish subsidiary of a leading Austrian bank which some two years ago acquired Polbank from the Greeks. Since then they have been trying to harmonize the computer systems. And of course having “legacy” bank accounts in both entities the possibilities for a b… up are astronomical. Anyway a client paid money into one of these legacy accounts (better 3 years late than never I guess). When I tried to transfer the money I was told that the account was blocked by a komornik (bailiff). Since this was the first I had heard of any seizing of assets I remonstrated and was told at my local branch that I needed to call the bank’s execution department whatever that might be. But of course no telephone number is listed on the less than helpfull website apart from a general call centre number. Well after being kept on the line for an hour or so I was finally put through to a person who might have been able to help and who informed me that she had no idea why my account had been blocked and would call me back in the next couple of days. I did ask whether she could unblock the account in the meantime but apparently this is not possible. Needless to say she never called back which started the next wild goose chase to find the address of the execution department so that I could write a formal complaint. You would think this was a category A state secret. Anyway finally I have managed to send a letter. I will report back how long it takes for me to be able to get at my money. Of course if I was an identity theft merchant I am sure the bank would have allowed me a loan using stolen identity!
This same bank has a so called customer relationship management system which, should you make payment on a credit card account more than 3 days before the due date, allocates the payment to the previous month and you then get pestered by an automated messaging service threatening amputation of legs and arms if immediate (i.e. further) payment is not made. And guess what, again no human being willing to listen.
Next on the list is registration of a second hand car I recently purchased. In the UK the seller sends a counterfoil from the log book and the purchaser sends the rest of the log book with new details entered by registered post to DVLC in Swansea and within a couple of days a bright new shining log book lands on the front door mat. NOT in Poland. Since the citizen is not to be trusted and because civil servants are 1. not civil and 2. the citizen is there to make their life easier and not the other way round you have to get a special form (woe betide if it is an old version), fill it in and take personally to the local authority office. You get a temporary vehicle registration document and a month later the real thing. To add to the complication if the previous owner lived in say Poznan and you live in Warsaw then new number plates have to be issued. Luckily (I thought) the vendor also lived in Warsaw and the lady at the desk said that I could keep the same number plate. Great I thought until she said that I had to remove the number plates and bring them to her for her to inspect. WHY?
The third instance concerns the Polish health service. Now this is in many ways actually rather good. As some of you may know I was diagnosed with MS some years ago and have had quarterly appointments at the excellent neurological institute in Warsaw since then. Today was a visit day and the poor receptionist looked sheepish as she said that for next year I would have to obtain a new referral from my doctor of first contact as the NFZ have decided to change the codes of ilnesses and if I did not get a new skierowanie I would not be able to see my specialist in the New Year. Now why is the system incapable of mapping the old codes to the new? MS is not curable so one would assume that a lifetimeskierowanie is just that – lifetime. So I have to go and find a doctor and waste my own and his time to obtain a document which does not add ANYTHING to the sum of human knowledge or happiness.
Which brings me on to the disabled parking bay permit saga. Again I had a lifetime decision o(rzeczenie) however the EU in its infinite wisdom has introduced a new style permit. Great I though except that Hanna Gronkiewicz-Walc’s people had decided that a new decision was required. So five, yes FIVE visits to the same office, once to collect the new application form (not available on line), then a second visit to lodge the application form only to be told that the form has been changed (luckily I was allowed to transcribe there and then), a third to attend a medical tribunal, a fourth to collect the decision and a fifth, after a month, to give me a chance to appeal against a positive decision!, to actually collect the permit. To add to the sureal the application form stipulated that I could not apply for a new decision earlier than 31 days before the expiry of the old. Now given that the old decision was lifetime…
But just to show that stupidity is not limited to Poland I read yesterday of an Australian whose parents were born in the UK being deported from the UK because his English born wife had lost her job! Now had he been an ISIS terrorist then he could have appealed on human rights.
by Andrew Kinast (AWK)
With more than 20 years of experience of advising foreign owner managed businesses PKGT is ideally placed to advise on succession planning….
……… and realisation of an exit strategy. We have developed a framework of potential issues which need to be addressed if the business is to survive the transition of management from the founder to successors, be they family members, employees or indeed outside managers. Cultural issues can play a significant role as the business moves from a “home jurisdiction” mentality to being more and more “Polish”. In particular the management style will need to change.
The list of issues outlined below is not exhaustive and not all issues will be relevant to a particular entity. At PKGT we can undertake a “hand holding” exercise starting with an assessment of the current position, identifying problem areas, looking at possible solutions and helping the client with implementation. As ever the role of the consultant is primarily to help the owner manager take an impassioned view of the business they have built up over a number of years and to share with the client experiences gained across a wide range of owner managed businesses.
In the course of an initial consultation our consultants will be able to identify those issues relevant to the individual client and will formulate a strategy for resolution.
The following list is not exhaustive and not all factors will be a problem to any individual business:
to find out more please find here http://pkgt.pl/pliki/Program%20for%20family%20businesses.pdf
visit our website www.pkgt.pl
The recent Polish Presidential elections have shown that electors are tired of the same old arguments between PO and PiS (the two main parties) but are not at all sure what they do want. Well let me help electors:
The real albeit not articulated concern of ordinary people be they rich or poor (i.e those who do not believe in conspiracy theories or that the only moral issues are in vitro and gender) is the issue of citizen rights as consumers and as small entrepreneurs.
I am sure that I cannot be the only citizen who is sick and tired of being taken for a ride by T Mobile trying to sell me services I do not want or need, PGNiG and RWE trying to tie me into long term contracts with the offer of cheaper energy only in the first year, LOT having a reservation system which requires me to enter my mobile phone number in two different formats and an on line check in system which does not allow check in on a code share flight operated by Lufthansa or TAP, a totally user unfriendly social security authority requiring me to prove that I am not a camel, having to queue five (yes five) times to apply for a disabled parking permit, being unable to apply for a passport or ID card by post or internet and having to supply “civil” servants with information which the state already has.
A recent press article shows how easy it is for large corporations to collect moneys not due from consumers and small businesses using the e-sąd system where the virtual judge does not even ask the putative debtor to put their side of the argument before issuing a payment order which allows the baillifs to run riot. And woe betide if you have moved house and TPSA has ignored your contract cancellation and continues to issue invoices sent to your old address and the court sends the payment order also to that and not your current address completely ignoring that you are now “zameldowany” somewhere else. As recent scandals have shown the state is powerless against baillifs who sell assets not belonging to the debtor and against officials in the Prosecutors office who allow the photgraphing of documents.
The government has just now published guidelines for how the various central and local government departments should communicate using the rather derogatory benchmark of language understandable by a mentally deficient grandmother. Well what about the language of contracts. What about the principle of equal treatment of the parties and defense of those who do not have access to full information? What about small print in contracts. By the by I now sign contracts and add the words I have NOT read the terms and conditions. When was the last time you tried to return faulty goods to any retailer and in particular the large multi nationals? Why do you as a consumer have to check sell by dates just because the fines for selling out of date goods are so laughably small as to be irrelevant?
Why as a small producer do you still have to wait for months for the likes of Tesco and Auchan to pay for goods they have long ago sold? Why if electors say that they are against so called “rubbish” employment contracts do they continue to buy Chinese products which clearly are produced by in effect slave labour? Why are banks able to increase charges by stealth?
And lastly why is the new Minister of Health a doctor who represents the supply side of health care rather than someone who would represent the consumer?
So come on Prime Minister Kopacz. Time to take the political debate away from substitute issues and concentrate on issues which would make life far simpler for consumers and small businesses who actually create employment. Time to do away with Social Security (ZUS) as a seperate tax system and move to a single system of taxation which would not create artificial anomalies. And time to create a Ministry for Consumer Affairs able and willing to create a truly level playing field.
There is a world of difference between a free competetive economy and one in which the freedom applies to only large state owned enterprises and oligarchies. The State is there to create a level playing field and protect the weaker. And the weaker is clearly the consumer i.e you and I.
The more serious Polish press report today a ranking of inward investment published by fDi Magazine. In 2014 inward investment into Poland totalled 6 billion US$. In terms of numer of investments Poland raked 5th in Europe.
In terms of country of origin 909 investments came from the UK, 378 from Germany, 252 from Spain and 237 from France.
German mittelstand businesses have always invested in Poland. It is a pleasure to see however that UK owner managed businesses are beginning to come to Poland. The high ranking of Spanish investment is probably on the back of Santander having acquired some years ago BZWBK from AIB.
The 6 billion invested into Poland has to be seen as part of an on going move of production eastwards and the growth of the Polish domestic consumer market.
Last week the central bank of Poland reduced interest rates by a full 0.5% with the headline rate now standing at an all time low of 1.5%. Most commentators believe the main reason for the move is the fact that the Polish economy is dangerously close to deflation. Now the reason deflation is a bad thing is the fact that consumers hold off purchases expecting proces to fall and manufacturers reduce stock. Which causes a down turn. So maybe holding interest rates relatively high was a bad move (hindsight is of course a wonderful things).
The question however remains as to whether near zero interest rates will in fact encourage businesses to borrow for investment and for consumers to buy more goodies (such as TV’s) on credit. As far as consumers are concerned it would appear that the major consideration with credit purchases is the amount of monthly repayments and not the rate of interest. For a short while the news of interest rate reductions can cause a feel good factor and of course for those with significant mortgages their disposable income increases. For corporations the key issue remains whether they believe that investment will pay off and whether the banks will be willing to lend.
There is another aspect to the equation. The central banks world wide primarily look to keep inflation within a narrow range. All well and good but what do the indexes measure? The average shopping basket which in a quickly changing world soon becomes misleading. And of course the inflation indicators do not measure asset inflation. With surplus funds looking for a home we have already seen a dramatic increase in house prices in the UK (well the South East at least). Stock markets have also bounced back.
But what of Poland? Will businesses invest in research and development and new technology as we are told is vital to achieve the next level of growth? Only if they believe there will be a market for the products. John Palmer from BNP Paribas Real Estate reports in a current review that the yield rate on Polish logistics properties has fallen to 7.15% to 7.25% having previously tested double figures and vacancy rates have dropped to 5.7%. The yield rate shows clearly that investors are back in the market whilst the fall in vacancy rates suggests that businesses are gearing up for increases in sales and hence need for warehouse space. Time will tell whether these are the first signs of growth rates increasing.
One of the key issues is that for the demand for employees to grow the Polish GDP has to grow more than gains in productivity. With the government side tracked by the double elections and having fallen into the trap of acceding to demands from public employees (miners amongst others) there is little chance that the still remaining barriers to business are removed any time soon.