197Acta všfs, 2/2008, roč. 2
New system of social services financing: myths
and mistakes
Nový systém financování sociálních služeb: mýty
a omyly
Ladislav Průša
Among other things, the law on social services significantly changed the system of the
financing of social services. The objective of my contribution is to point out some myths
and mistakes that accompanied the creation of this system and to present possible solutions
of the existing problems.
First mistake:
Within the grant proceedings, the basic principles of grant proceedings were not
respected; there are differences in the amounts of the provided subsidies both among
individual regions, as well as among organizations, depending on the selected organizational
structure.
According to § 101 of law no. 108/2006 Coll., on social services, as amended, a grant from
the state budget is provided for the securing of the provision of social service to those
providers that are entered in the register. But an analysis of the results of grant proceedings
shows that there are considerable regional differences in the provision of subsidies
for individual types of social services, which suggests that, within the scope of grant proceedings,
the breaching of the fundamental principles of grant proceedings, as they were
defined in the year 2000 
, occurred. These are especially
●	 the principle of equal conditions for all providers of public services,
●	 the principle of equal conditions for all recipients of public services,
●	 the principle of the effective utilization of public funds,
●	 the principle of a transparent system of financing,
●	 the principle of a stable system of financing.
A detailed analysis of the amount of subsidies provided to residential services in individual
regions shows that there are diametrical differences among individual regions:
●	 whereas in the South Moravia region in first place was a provided grant in the amount
3,588 CZK per month for a senior citizens’home, in the Liberec region its amount was
more than 2.8 times higher and was 10,131 CZK,
	 see: L. Průša, O. Mátl – Nad pojetím dotační politiky MPSV, Sociální politika no. 9/1999, pg. VI, ISSN 0049-
0962
198 Acta všfs, 2/2008, roč. 2
●	 whereas in the Pilsen region, a grant in the amount of 6,280 CZK per month was
provided for one place in a social services facility for handicapped citizens, in the
Pardubice region its amount was more than 2.2 times higher and was 14,097 CZK 
(see graph no. 1).
Graph 1: Amount of grants per 1 bed in homes for seniors and in homes for handicapped
persons (including special treatment homes)
0
2 000
4 000
6 000
8 000
10 000
12 000
14 000
16 000
Prague
CentralBohemiaRegion
SouthBohemiaRegion
PilsenRegion
KarlovyVaryRegion
ÚstíRegion
LiberecRegion
HradecKrálovéRegion
PardubiceRegion
VysočinaRegion
SouthMoraviaRegion
OlomoucRegion
ZlínRegion
CzechRepublic
Moravia-SilesiaRegion
grant for 1 place in a retirement
home per month
grant for 1 place in a social care
institute per month
Source: own analysis on the basis of Ministry of Labor and Social Affairs (MLSA) internal
data
These differences show that within the grant proceedings, the principle of equal conditions
for all recipients of social services was also breached, since the existing differences in the
amount of the provided grants among individual regions will clearly be reflected – also
thanks to the change to the contractual principle for the provision of social services – in
the differing amount of payments of the user of the service when using a comparable type
of service.
These differences are also confirmed by findings that were shown by the survey on grant
proceedings
, i.e., that the grant proceedings were not sufficiently transparent.
Also the data about the total volume of funds spent on grants for all types of social services
per one citizen of an individual region were roughly compared. Despite the fact that
also here there are considerable regional differences in facilities, which cannot even be
quantified in the area of the services of social prevention, since the existing statistics do
	 in the interest of the objectivity of this comparison, it is necessary to state that the amount of grants in Social
Care Institutes can be partially influenced by the differing structure of these facilities in individual regions
	 see: V. Hanzl – Anketa o dotačním řízení, Rezidenční péče no. 1/2007, pg. 6, ISSN 1801-8718
199Acta všfs, 2/2008, roč. 2
not monitor the majority of these services at all, even here the differences among individual
regions are very significant (see graph no. 2):
●	 whereas the lowest volume of grants, when recalculated to 1 inhabitant in a region,
was provided in the capital city of Prague (almost 36 CZK per inhabitant per year),
in the Zlín region it was more than 2 times more (almost 75 CZK per inhabitant per
month).
Graph 2: Amount of grants for social services recalculated for 1 inhabitant (CZK per month)
0
10
20
30
40
50
60
70
80
Amountofgrants(inCZKpermonth)
Prague
CentralBohemiaRegion
SouthBohemiaRegion
PilsenRegion
KarlovyVaryRegion
ÚstíRegion
LiberecRegion
HradecKrálovéRegion
PardubiceRegion
VysočinaRegion
SouthMoraviaRegion
OlomoucRegion
ZlínRegion
CzechRepublic
Moravia-SilesiaRegion
Source: own analysis on the basis of MLSA internal data
The principle of equal conditions for all providers of social services was also breached
from the perspective that the level of the coverage of the requirements of individual providers
is significantly differentiated based on their legal form. It is apparent that the most
satisfied are subsidized organizations that are established by the region and that provide
social care services, as their requirements were met at a level of 82.8% (the total amount
of the grants is 4,204 million CZK). In virtually all of the cases, these are institutions of
social care for the elderly and handicapped citizens, whose grant requests were met in this
extent. The lowest level of the meeting of the requirements is being reported by business
companies, whose requests for grants for social care services were met at a level of 2.7 %
(the total amount of the grants is 1.1 million CZK). Even though it is not clear from the
overview in table 1 what the portfolio of social services provided by individual founders
is, the differences, from the perspective of the level of satisfaction of the requirements of
individual types of providers, are striking.
200 Acta všfs, 2/2008, roč. 2
Table 1: Comparison of the amount of the provided and requested grants, depending on
the type of provider of the social service
  grant
  mil. CZK % of request
Alliance of municipalities     0.3 20.6
Subsidized organization established by the
region
4 294.8 82.7
Subsidized organization established by the
municipality
  951.6 49.8
Church legal entity   561.2 59.0
Physical person     6.4 18.4
City, municipality, organizational unit    23.4 12.5
Public service organization   137.3 49.5
Business company     1.1   2.7
Civic association   729.6 49.6
Health care provider     1.1 20.2
Total 6 706.7 66.6
Source: own calculations based on the Interim report on grant proceedings by the Ministry of
Labor and Social Affairs (MLSA) in the area of the support of the provision of social services,
Prague: MLSA, 2007
Second mistake:
The payout of the contribution for care in cash does not create a dynamic environment
for the development of social services; the criteria for its awarding are not
balanced
The existing method of the evaluation of the level of dependence makes it possible to
objectively evaluate the social situation of mainly physically handicapped and elderly
persons. On the other hand, it does not make it possible to objectively evaluate the needs
of mentally handicapped and blind persons. A number of the recipients of the contributions
for care are stopping the usage of social services, since they understand the provision
of the contribution as a means for the increasing of their own standard of living, or for
the increasing of the standard of living of their families or the families of their children.
Approximately 70% of the funds paid for the contribution for care do not return to the
area of social services. This fact leads to the existential problems of a number of providers
of social services, especially those having an in-the-field character, both from the ranks of
non-state and non-profit organizations, as well as from the ranks of subsidized organizations,
especially municipalities and cities.
Negatively is also evaluated the fact that members of the resistance -- for whom social
services are provided for free pursuant to the corresponding laws -- can be the recipients
201Acta všfs, 2/2008, roč. 2
of a contribution for care, by which basically the double fulfillment of their rights occurs,
respectively the abuse of the contribution.
These problems can be solved by taking these measures:
a)	 clearly define that the contribution for care in a 1st and 2nd degree of dependence
will only be paid out via vouchers and that only registered entities will be able to
provide services for these persons,
b)	 if a person is placed into a residential facility, then the contribution for care is by law
the direct income of this residential facility,
c)	 if a person is the recipient of a contribution for care in a 3rd and 4th degree of dependence,
and care is provided for this person by a family member, consider the possibility
of increasing the level of contribution for care
, and for this family member:
●	 include the care period as a substitute period for the purposes of pension insur-
ance,
●	 in labor relations provide similar protection to the care provider as parents have
on parental leave,
●	 enable the taking of special courses, which would represent a certain form of support
for the care provider,
d)	 do not set the maximum amount of reimbursement for room and board in residential
facilities, as well as the amount of reimbursement for individual actions of the care
service, by law and a procedural regulation linked to it, but leave room for the establishing
of these amounts directly between the provider and user of the service,
e)	 clearly stipulate that the person, who by law has the right for the provision of social
services for free, does not have the right for the payment of a contribution for care.
The entity that provided these services for this person receives compensation based
on information stated in his registration,
f)	 re-evaluate the criteria for the assessing of the degree of dependence so that the
needs of all groups of handicapped and elderly citizens are objectively evaluated,
g)	 re-evaluate the degree of dependence of those recipients of a contribution for care,
who acquired the right to it by roll-over from the increasing of the pension for the
incapacitated and the contribution during care for a close person.
When setting the amount of payment for a client for room and board in residential facilities,
and for individual acts of social services, the existing legislation is based on the fact that the
establishing of a maximum payment amount is one of the forms of the protection of the client,
which -- at the moment when social services are provided by organizations established
by self-administration authorities of municipalities, cities and regions, and non-state non-profit
organizations on contractual principles -- is an unsystematic element that does not create
sufficient space especially for the desirable development of in-the-field social services. For the
protection of the users of social services, the law has a number of effective tools (registration of
the providers of social services, standards for the quality of social services, inspection of social
services, whole-life education of social workers) available, and therefore the amount of the
payment for provided social services should be set directly by the provider of the social service
and should be stated both in the contract with the user of the social service as well as in the
	 within the scope of the Proposal of the material intention of the Law on social assistance, which was prepared
at the turn of 1997 - 1998, it was proposed to increase the contribution for care by 25 % in these cases
202 Acta všfs, 2/2008, roč. 2
provider’s registration. At the same time, the existing amount of payments for the provision of
care services, which is regulated by regulation no. 505/2006 Coll., is set at a very low level, which
does not make the desirable development of this type of service possible.
First myth:
Changes in the system of the financing of social services will make it possible to
decrease the capacities of residential social services facilities in the next period
The forecast of the development of the population, which was prepared by the Czech
Statistical Office at the beginning of this millennium, shows that significant changes in
the structure of our population will occur in the following years. According to the so called
medium alternative, it is assumed that by the year 2025 the total population will slightly
decline, but the number of persons that are the most frequent recipients of social services
-- i.e., persons older than 65 -- will increase by more than 50 %, and the number of persons
older than 80, who are the most frequent clients of social care residential services, will
actually increase by more than 60 %. These trends will also continue in the subsequent
period, as during 2025 - 2050 it is anticipated that the total population will decline by
approximately 8 %, but the number of inhabitants older than 65 will grow by another
more than 30 %, and the number of persons older than 80 will grow by another more than
75 %. These trends are apparent in detail from table no. 2 and graph no. 3.
Table 2: Selected characteristics from the forecast of the CR population until 2050
year
    Share of persons older than
Number of
inhabitants
Of this, older than 65 80
total 65 80
Of the total number of
inhabitants
2005 10 235 973 1 446 681 315 988 14.13 3.09
2010 10 283 042 1 596 812 368 068 15.53 3.58
2015 10 301 994 1 864 146 390 459 18.10 3.79
2020 10 283 929 2 088 333 413 674 20.31 4.02
2025 10 217 200 2 201 310 509 607 21.55 4.99
2030 10 102 433 2 308 073 664 338 22.85 6.58
2035   9 957 079 2 399 918 771 810 24.10 7.75
2040   9 795 118 2 633 554 800 123 26.89 8.17
2045   9 622 248 2 862 020 844 525 29.74 8.78
2050   9 438 334 2 956 079 904 745 31.32 9.59
Source: Population forecast of the CR until 2050 [online], cit. [2007-10-01], accessible on:
http://www.czso.cz/csu/2003edicniplan.nsf/t/FF004F4709/$File/4020rr05.xls
http://www.czso.cz/csu/2003edicniplan.nsf/t/FF004F5158/$File/4020rr06.xls
own calculations
203Acta všfs, 2/2008, roč. 2
Graph 3: Development of the population in 2005–2050 and development of the share of
persons dependant on the provision of social care services
0
2 000 000
4 000 000
6 000 000
8 000 000
10 000 000
12 000 000
2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
year
population
0
5
10
15
20
25
30
35
shareofpersonsolderthan65(resp.80)ofthetotalpopulation
total
65+
80+
share 80+/C
share 65+/C
Source: own analyses
Table 3: An estimate of the need for social services for senior citizens in the following
period, with the maintenance of the facilities at the 2006 level
Retirement Homes/80+ Social Services/65+
Total number
of places
Growth
compared
to 2006 in
absolute
terms
Growth
compared
to 2006
in %
Total
number of
person
Growth
compared
to 2006 in
absolute
terms
Growth
compared
to 2006
in %
2010  42 438  3 766    9.74 113 214   8 126   7.73
2015  45 020   6 348   16.41 132 168   27 080 25.77
2020  47 697   9 025   23.34 148 063  42 975 40.89
2025   58 758 20 086   51.94 156 073   50 985 48.52
2030   76 598 37 926   98.07 163 642   58 554 55.72
2035  88 990 50 318 130.11 170 154   65 066 61.92
2040   92 254 53 582 138.56 186 719  81 631 77.68
2045   97 374 58 702 151.79 202 917   97 829 93.09
2050 104 317 65 645 169.75 209 586 104 498 99.44
Source: own calculations
With the maintaining of the existing proportions of the availability of social services in
2006 (the capacity of homes for seniors makes it possible to place 11.53 % of persons older
204 Acta všfs, 2/2008, roč. 2
than 65, care services are provided to 7.09 % of persons older than 65), it is possible to
quantify the growth of the need of social services for seniors during the following period
(see table no. 3 and graph no. 4)
Graph 4: Estimated growth of the number of places in homes for seniors in proportion to
1000 persons older than 80 and the number of persons for whom social services will be
provided, in proportion to 1000 persons older than 65, with the maintenance of facilities
at the level of 2006
0
20
40
60
80
100
120
140
160
180
2010 2015 2020 2025 2030 2035 2040 2045 2050
growthincomparisonto2006(in%)
PS Social Services
DD Retirement Home
PS/1000 65 +
DD/1000 80 +
Source: own analyses
It is clear that it will be necessary to further specify this data in the following period, especially
on the basis of an analysis for the need for care depending on the age of a person
and type of care provided according to data from the information system on contributions
for care. This data will also make it possible to update the data defining the need of social
services in relation to the level of dependence and age of persons of a higher age
.
Abstract
The implementation of a new system of financing of social services establishes the conditions
for the finding of the optimal form of the securing of human needs in an unfavorable
social situation, which should contribute to the increasing of the effectiveness of the spent
funds. The goal of this paper is to analyze some myths and mistakes that directly influence
the effectiveness of this system of the social protection of the population. In this sense,
attention is paid especially to:
●	 an analysis of the results of grant proceedings, which are regulated by § 101 of law
no. 108/2006 Coll., on social services, as amended,
	 see: L. Průša a kol. – Obce, města, regiony a sociální služby, Praha: SOCIOKLUB 1997, pg. 31, ISBN 80-902260-
1-9
205Acta všfs, 2/2008, roč. 2
●	 an analysis of some of the findings on the manner of using the contribution for care
for the securing of the need of care for oneself,
●	 the implications of an aging population on the need of services for elderly citizens,
in connection with the change of the system of social services financing.
Keywords
social services, grant policy, demographic development
Souhrn
Zavedení nového systému financování sociálních služeb vytváří předpoklady pro nalezení
optimální formy zabezpečení potřeb člověka v nepříznivé sociální situaci, což by mělo
přispět ke zvýšení efektivnosti vynakládaných finančních prostředků. Cílem tohoto příspěvku
je analyzovat některé mýty a omyly, které se bezprostředně dotýkají efektivnosti
tohoto systému sociální ochrany obyvatelstva. V tomto smyslu je pozornost věnována
především:
●	 analýze výsledků dotačního řízení, které upravuje § 101 zákona č. 108/2006 Sb., o sociálních
službách, v platném znění,
●	 analýze některých poznatků o způsobu využívání příspěvku na péči k zabezpečení
potřeby péče o vlastní osobu,
●	 důsledkům stárnutí populace na potřebu služeb pro staré občany v souvislosti se
změnou systému financování sociálních služeb.
Klíčová slova
sociální služby, dotační politika, demografický vývoj
Contact address / Kontaktní adresa
doc. Ing. Ladislav Průša, CSc.
Institute of Finance and Administration
(e-mail: ladislav.prusa@vsfs.cz)
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