Gross reasserts his authority following financial scandal

Stanislav Gross, photo: CTK

"It's just like Sarajevo"- those were the words of Prime Minister Stanislav Gross on Tuesday, when he was told at a news conference in France that Miroslav Kalousek, the leader of the junior coalition partner, the Christian Democrats, had given him an ultimatum: he should either clarify aspects of his personal finances or resign. Seven years ago, the same party made a similar move when the then Prime Minister Vaclav Klaus was on a trip abroad in Sarajevo. On that occasion they actually managed to bring down the government.

Prime Minister Stanislav Gross, photo: CTK
But back home on Thursday, Mr Gross went on the offensive, and made it clear he had no intention of resigning. At this stage he appears to have survived the crisis. Dita Asiedu has been following the story. Dita, what was the catalyst for the whole crisis?

A few weeks ago, the paper Mlada fronta Dnes questioned how Mr Gross was able to afford to make a down payment of 1.2 million Czech crowns, around 50,000 US dollars, on a Prague flat in 1999, when his official earnings had been well below that sum. Mr Gross gave several different versions of the story, at times contradicting himself, undermining the confidence even of his allies. The story was picked up by the rest of the media and ended up in parliament, where the opposition used it to give Mr Gross a tough time. At the same time Mr Gross's wife Sarka has also been accused of dubious business dealings, over another loan to purchase a building in downtown Prague.

Which did not seem to threaten Mr Gross' career, until the coalition partners came into it this week...

Exactly. In itself this is not a major scandal, involving relatively small sums of money, but the Social Democrats' partners in an extremely shaky government coalition, chose not to let the scandal fade from the limelight. That's where the leader of the Christian Democrats, Miroslav Kalousek, and his statement during the prime minister's trip to France comes in. Mr Kalousek said the scandal was damaging the government's reputation and had made it unworkable. He hinted - and some say even said overtly - that Mr Gross should go. He also called on him to clean up his financial affairs, and those of his wife.

And Prime Minister Gross was in France at the time...

Yes, he was on a two-day trip to France, from where he snapped back at the Christian Democrats they could leave the government if they wanted. Back in Prague, Mr Gross went on the offensive. He cancelled a meeting that the Christian Democrats had called for - to bring together all parties in parliament except for the Communists - and said that instead he would meet with each party leader in the government for individual talks.

But Mr Gross had to prepare for a question-and-answer session in the lower house first...

That's right. The centre-right opposition Civic Democrats grilled him for 45 minutes on Thursday afternoon. Not just about his own finances but about his wife's business activities as well. One of those attacking Mr Gross was opposition Civic Democrat MP, Petr Necas. Afterwards he told us that they got very little out of him that they didn't already know:

"It was only some kind of a tricky business from the prime minister and I hope that public opinion will be able to observe this strange behaviour. I don't think this scandal is directly connected to the issue of early elections. All ministers and ruling coalition parties have been strongly interested to stay in this government and I don't think there will be some internal problems with the government's stability."

But Mr Gross has taken a few steps to appease his critics. He did say that his wife had agreed to cease her business activities...

...yes, but only for as long as her husband remains in office. And Mr Gross also ate humble pie, saying that he would cancel the controversial loan on his flat, and take a mortgage.

Stanislav Gross and Pavel Nemec, photo: CTK
After the parliamentary session, Mr Gross secured a promise from Pavel Nemec, the leader of the smallest coalition party, the Freedom Union, that the party was willing to keep the government afloat.

So, it looks like Mr Gross has nothing to worry about now. He's always had his party's support, he's made a few gestures to appease the Christian Democrats, and remind them of their junior status in the government, and he's managed to keep the opposition at bay.

That's right. The Civic Democrats can't touch Mr Gross as long as his coalition remains secure, and the Christian Democrats have also had little choice than to go back from the brink, having realised that they would probably have little to gain from being seen as the ones who brought down the government. But public confidence in the government is shaken.