INTERVIEW: Polish govt appoints funny man to get serious on red tape

By bne IntelliNews April 23, 2008

Jan Cienski in Warsaw -

Janusz Palikot is one of the Polish parliament's most flamboyant politicians - best known for holding a news conference denouncing police wrongdoing during which he waved a pistol and a fleshy dildo - but that hasn't stopped Donald Tusk, Poland's prime minister, from handing him one of the key jobs in government: slashing the red tape that throttles business and dogs the lives of normal citizens.

Palikot is a publicity hound whose quick mouth often gets him into trouble - recently he accused President Lech Kaczynski of drinking too much, to which the president responded by calling him a "clown" - but is one of the most accomplished businessmen in parliament, which he entered after making a fortune in producing alcohol. "I was in business for 17 years and I have seen a lot of these problems myself," says Palikot, speaking from the back seat of his chauffeur driven SUV as he was ferried to a television interview to talk about the first hundred days of his parliamentary commission.

The Friendly State commission he heads is the hardest working in parliament, with its members meeting several times a day to come up with an initial list of 250 harmful or idiotic rules and laws that need to be changed. One of Palikot's favourite examples is the VAT regulation on how a car should be measured to see if the tax could be written off. The rule is written in such bizarre language that it's impossible to follow. "I took the commission members to a car and we tried to measure it according to the law. It was impossible," he says with a laugh.

But the effects of such illogical regulations are far from funny. "In Poland there are hundreds of laws and regulations which are unclear and often absurd," says Palikot. "The result is complication and a lack of transparency which affects every sphere of Polish life."

He mentions another regulation requiring employers to recalculate their employees' social security contributions every quarter, a relic of a time when Poland was wracked with high inflation. With inflation now much lower, there is no need for such frequent recalibrations, but bureaucrats are loath to change. "Imagine all the time and energy that could be saved if rules like this were changed," says Palikot. Yet another rule that gives business fits is the tax regulation that businesses have to pay VAT for services rendered even before the customer pays their bill, which can cause severe cash flow problems for smaller companies.

Tough business climate

Poland's mangled regulations make it one of the toughest places in Europe in which to do business. In its annual Doing Business report, the World Bank found that Poland ranked 74th out of 178 economies, the second lowest in the EU. Poland was ranked 129th when it came to opening a business and 156th for dealing with licenses.

Lewiatan, the Polish business confederation, comes up with a yearly list of barriers to doing business which now stretches to 52 pages and shows no sign of shrinking. Palikot's commission has gathered the information on legal absurdities directly from business and people affected by the rules. In the past, similar de-bureacratisation commissions tried to come up with lists of laws to change on their own, which took years. The results were then bundled into a single, very complex reform law, which invariably failed to make it through parliament. "We want to make a lot of little changes," says Palikot. "Everyone who tried to do this before us had a huge complex piece of legislation. Our approach is easier and uses much less political capital. What we're trying to do is a little like the bombing of Iraq. We aim at the enemy, hit, leave a hole in the ground and move on."

Palikot has the prime minister's full backing, which makes it likely that a lot of the changes he is working on will be approved by parliament. "I'm counting on the prime minister," says Palikot. "Without his support, we wouldn't have been able to move nearly as fast."

Making the commission a success is an important priority for the PM. When his Civic Platform party won last October's elections, Tusk promised a sharp break with the statist views of his predecessor Jaroslaw Kaczynski and his Law and Justice party. His pledge to make Poland more open appealed to thousands of young people who were crucial in bringing him to power. If Palikot fails - as has every past attempt to trim back the bureaucracy that entwines Polish life - then Tusk's own chances of re-election are also damaged. That is why his choice of Palikot to head the commission raised many eyebrows. Although Palikot was a successful businessman, he had become known as the class clown of the Polish parliament.

So far, he has treated his work very seriously, setting up good cooperation with the other parties on the commission, something of a rarity in the Polish parliament. "I work all day and night because I know that something may finally come of this," says Palikot, dressed in a deep red velour blazer with foppish hair falling over his face.

Despite the importance of the task before him, Palikot has been unable to restrain his impulsive streak. He faces legal action for his comments accusing the president of drinking, which didn't stop him from conflating Father Tadeusz Rydzyk, a controversial nationalist priest whose Radio Maryja network supports Law and Justice, with Beelzebub, the prince of darkness. His own personal life is fairly messy, with a very public divorce and a new romance with a dancer, all while living in a refurbished aristocratic palace in Lublin in eastern Poland.

But Palikot, a philosopher and author as well as a politician, may be just the kind of headstrong and unconventional character who can do what Tusk promised just after his election and take a "machete" to red tape. "What we're doing could have a revolutionary effect," he says before clambering out of his car for the TV interview, the last of several that day as he tries to spread the gospel that the state should be small and efficient and the bureaucracy should be there to serve people, and not to cow them and dog them with harmful and ridiculous regulations and procedures.

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INTERVIEW: Polish govt appoints funny man to get serious on red tape

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