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COVID-19 EU PolicyWatch

Database of national-level responses

Eurofound's COVID-19 EU PolicyWatch collates information on the responses of government and social partners to the crisis, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for case SI-2020-40/1485 Updated – measures in Slovenia

Partial reimbursement of fixed cost

Delno kritje fiksnih stroško

Country Slovenia , applies nationwide
Time period Temporary, 01 October 2020 – 31 March 2021
Type Legislations or other statutory regulations
Category Supporting businesses to stay afloat
– Direct subsidies (full or partial)
Author Maja Breznik (University of Ljubljana) and Eurofound
Case created 27 November 2020 (updated 22 January 2021)

Background information

On 25 November 2020, the Parliament passed the sixth COVID-19 law ( Act Determining Intervention Measures to Remedy the Consequences of the Second Wave of COVID-19 Epidemic , ZIUOPDVE). The partial reimbursement of fixed costs is a new measure. Besides the already existing Temporary layoff scheme and reimbursement of wage related compensation to employers , the Partial reimbursement of fixed costs is the most important state intervention in the sixth COVID-19 law. The minister of finance expects that both measures will cost about €900 million.

Content of measure

The measure aims at supporting businesses to overcome temporary stagnation by subsidising their fixed costs. These costs may include compensations for land use, insurance fees, utility costs and energy bills. Private companies (including self-employed persons and cooperatives) must meet the following requirements:

  • Established before 1 September 2020;
  • Employing at least one person;
  • Not a ‘firm in difficulty’, as defined in Commission Regulation (EU) No 651/2014;
  • Cannot perform business activities or to a lesser extent due to COVID-19 epidemic;
  • Fixed costs are not covered by other sources (like insurance);

Thresholds for the partial reimbursement of fixed costs are:

  • at least 30% lower income in the last quarter of the year 2020 compared to the same quarter of the year 2019;
  • the maximum support is limited to €1,000 per employee a month;
  • the maximum support is limited to 70% less income for large and medium companies and 90% for small and micro-companies.

The government will pay off reimbursements on 20 January 2021.

The Minister of Finance gave exemplar calculations of a subsidy one company may receive. A company with 60 employees, €3 million income and 70% less income gets €108,000. If the same company has between 30 and 70% less income, it receives €54,000. A small company with 3 employees, €12,000 income a month and 70% less income gets €5,400. If it has between 30 and 70% less income, it receives €2,700.

Updates

The following updates to this measure have been made after it came into effect.

29 December 2021

The seventh COVID-19 law (ZIUPOPDVE), adopted by the Parliament on 29 December 2020, raised subsidies for fixed costs in sectors most hit by the epidemic: Thresholds for the partial reimbursement of fixed costs are:

  • €1,000 per employee a month for a company with at least 30% lower income and up to 70% lower income;
  • €2,000 per employee a month for a company with more than 70% lower income;
  • the maximum support is limited to 70% less income for large and medium companies and 90% for small and micro-companies;
  • total state support cannot exceed €800,000.

Calculation of lost income can also take into account the average number of employees or the value of fixed assets, excluding land if it is more favourable for the beneficiary.

All reimbursements will be paid in January 2021. The government extended measure until 31 March 2021.

The Chamber of Craft and Small Business of Slovenia (OZS) and the Slovenian Chamber of Commerce (TZS) said that all measures together do not cover all costs. Employer organisations appealed for the opening of shops and activities as soon as possible.

Use of measure

The measure is valid for the last quarter of the year 2020. It may be prolonged for another six months.

Target groups

Workers Businesses Citizens
Does not apply to workers Applies to all businesses Does not apply to citizens

Actors and funding

Actors Funding
National government
Company / Companies
European Funds
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Negotiated Agreed (outcome) incl. social partner initiative
Form Consultation through tripartite or bipartite social dialogue bodies Consultation through tripartite or bipartite social dialogue bodies

Social partners' role in the implementation, monitoring and assessment phase:

  • Social partners jointly
  • Main level of involvement: Peak or cross-sectoral level

Involvement

Social partners contributed their proposals and amendments to the law. Employer organisations (The Chamber of Commerce and Industry of Slovenia, GZS and The Chamber of Craft and Small Business of Slovenia, OZS) demanded lower thresholds and a higher ratio of subsidies to the lost income than determined in the sixth COVID-19 law. Trade unions proposed employee participation in profits for all companies which have received any state support during the epidemic. The proposal was not accepted.

Views and reactions

Opposition parties protested against the provisions which, in their view, do not fall within the emergency law. One of the contested articles is a prolonged accreditation of higher education institutions. It is allegedly a service to a private university ( Nova univerza ), closed to the ruling Slovenian Democratic Party. The second is a very high fine between €1,200 and €12,000 for organizing a protest during the epidemic. Oppositional MPs claim that the fine tries to stop massive protests against government occurring every Friday since April 2020 (but temporarily interrupted due to epidemic). But there are many more: more than 100% higher subsidies to religious institutions (Articles 107–108); the right of communities to change the use of agricultural land up to ten acres etc.

Sources

  • 25 November 2020: Zakon o interventnih ukrepih za omilitev posledic drugega vala epidemije COVID-19 (ZIUOPDVE) [Act Determining Intervention Measures to Remedy the Consequences of the Second Wave of COVID-19 Epicemic (www.iusinfo.si)
  • 26 November 2020: Poslanci sprejeli paket za gospodarstvo s »podtaknjenci« [Deputees adapted law for economy along with 'rootstocks' (www.delo.si)
  • 30 December 2020: Act Determining Intervention Measures to Assist in Mitigating the Consequences of the Second Wave of COVID-19 Epidemic (Zakon o interventnih ukrepih za pomoč pri omilitvi posledic drugega vala epidemije COVID-19, ZIUPOPDVE (pisrs.si)
  • 05 January 2021: MMC RTV, OZS: Stanje v malem gospodarstvu je alarmantno [OZS: Situation in small business is alarming (www.rtvslo.si)

Citation

Eurofound (2020), Partial reimbursement of fixed cost, case SI-2020-40/1485 (measures in Slovenia), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.