Managers of 112 companies evaluated performance of institutions

Busines Support Network conducted a small survey during the summer season and contacted managers of 112 small, medium-sized and large companies in Belgrade, Novi Sad, Subotica and Šabac, identifying their opinions on the efficiency of the national and local-level institutions important for the business environment.

Survey was conducted by e-mail, on the addresses of company managers in july and august 2014.

Out of the total of 112 companies included in the survey, 29 are micro-sized (up to 10 employees), 44 are small-sized (between 10 and 49 employees), 26 medium-sized (50 to 249 employees) and 13 large companies (250+ employees)

Managers have received a list of 32 different institutions that businesses have to work with in course of their economic activity, due to Serbian regulations. Each of these institutions the managers had to evaluate with one of the three possible grades – positive, negative, or neutral (no opinion).

The leading among the negatively evaluated institutions is the Tax Administration, which was criticized for lack of organization, slowness, lack of electronic communication, insufficiently trained personnel that are unable to explain the methods of their work, lack of IT knowledge and efficient information system, lack of networking with other institutions and bad relationships with clients.

Local self-governments were criticized due to surplus of employees “who often complicate and do not understand their job”, lack of electronic communication, unnecessary fees and charges used to pull the money out of the business sector, complicated procedures and paperwork, corruption in the process of granting construction permits and other services, etc.

Ministry of Finance is especially criticized due to the nature of fiscal regulations, seen as complicated and unclear. Furthermore, the fiscal legislation is in collision with other legislation, which makes it necessary to request the official opinion of the Ministry, which is charged 11,000 RSD, and are not legally binding. In addition, they are criticized for complicated and expensive Law on Accounting, which contributed to the situation in which “everyone writes and compiles financial reports as they desire”, which brings additional legal uncertainty in the system. Also, managers hold the opinion that the total tax burden on wages and overall taxation system are designed in such manner that they stifle the economic growth in long-term and prevent the opening of new companies and creation of new jobs.

Republic Real Estate Cadaster was assessed to be a “hotbed of corruption, inefficiency and arbitrariness”. Managers on average are waiting for months to receive certain documents, and a significant number noted that they have given up from an investment or expansion of business activities due to this institution. They state it was impossible for them to overcome the bureaucratic network of Cadaster, local self-government and other institutions.

Finally, several Ministries made the list, which are criticized for being slow to reform the sectors within their competences (Ministries of Education, Construction, Finance) or lack of efforts for reducing corruption and informal economy (Minisries of Construction, Finance, Interior). Ministry of Trade, Tourism and Telecommunication was criticized due to slowness in introduction of e-government and lack of reform of trade regulation. It is also criticized for not creating conditions for improved development of tourism and hospitality industry.

Positive evaluations

Out of 32 institutions covered by the survey, managers evaluated only five institutions with more positive evaluations than negative ones – the Business Register Agency, Central Register of Compulsory Social Security, Ombudsman, Anti-Corruption Council and Commissioner for Information of Public Importance.

The managers primarily stated that these institutions are diligent and responsible in the course of their activities and to have employees who are sufficiently trained to communicate with the business sector, unlike the institutions which were evaluated negatively.

Regards,

Team of the Business Support Network