Czech coalition rocked by scandal on eve of EU presidency

Petr Hlubuček, a member of the Mayors and Independents movement (STAN), the second-largest party in the Czech coalition, resigned from his post as deputy mayor of Prague and was taken into custody on suspicion of running an organised crime operation from Prague City Hall, facilitating a network of bribery for tenders run by Prague's Public Transport Company.

Bribes of tens of thousands of euros are alleged to have been distributed among a 13-member criminal group. Members of the gang were assigned code-names — Hlubuček was known as "The Hen" due to his fondness for keeping chickens — and police wiretaps suggest a culture of rapacity.

It's also alleged that illegal drugs were used by gang members at safe houses where money changed hands.

A pro-EU government under pressure

Police claim the criminal group had a well-oiled structure led by businessman and lobbyist Michal Redl, who was also taken into custody on Friday (17 June).

The scandal has already claimed other political scalps, the highest profile being that of Petr Gazdík, who resigned as education minister on Sunday morning over his links with Redl.

Gazdík has not been accused of any wrongdoing but said his resignation would protect the government.

More links between the STAN movement and Redl have since been exposed. MEP Stanislav Polčák left STAN on Monday morning over his own contacts with Redl.

And concerns about corruption are becoming more acute as the extent of the businessman's links with the party become alarmingly clear.

"STAN is organised crime," claimed former prime minister Andrej Babiš. "I have talked about this repeatedly. It is a group that went into politics to steal money for itself."

But prime minister Petr Fiala tried to spin Gazdík's departure as new evidence of his coalition's integrity, describing it as "an honest solution which we have not been used to in high politics in recent years."

Yet with STAN accounting for 33 MPs out of his majority of 108, doubts about the fundamental honesty of the party leave Fiala's alliance looking decidedly flimsy.

Trouble on the eve of the Czech EU presidency

Gazdík said he resigned because he did not want the scandal "to shake the government or the coalition on the threshold of the EU presidency."

But his departure won't make the allegations any less damaging to the Czech government's reputation in Brussels.

"Looking back to before the election, there was a supposed dichotomy between the 'corrupt populists' and the coalition as the 'good guys'," Jan Kovář, deputy research director and expert on Czech-EU relations at Prague's Institute of International Relations, told EUobserver.

"But if you have a platform built around liberal democracy and an anti-corruption ethic, a scandal like this is very embarrassing and will have a major impact on perceptions," he added.

Questions will be raised about the country's moral authority to lead a bloc which is more concerned than ever about the rule-of-law in central Europe, notwithstanding the controversial recent approval of Poland's Covid recovery fund.

"Symbolically, this will damage the Czech government in Europe. It won't necessarily make a big difference practically; rule-of-law concerns were never going to be a big priority of the Czech EU presidency. But in the European Parliament, especially, this may be a huge reputational blow," said Kovář.

Politicians: 'they're all the same'

Even more significant than frustration in Brussels, though, will be the backlash against STAN from a Czech electorate which has had enough of corruption.

The country was mired in sleaze scandals in the 1990s and 2000s, and corruption under the new regime risks renewed cynicism about politics and politicians.

"They're all as bad as each other" is quickly becoming the popular assessment of the scandal.

"Domestic perceptions are the most important for the government. The coalition's supporters are very sensitive to corruption allegations, and care deeply about such matters," Kovář told EUobserver.

STAN leader and interior minister Vít Rakušan has so far emerged relatively unscathed, though one Prague councillor claims to have previously warned him about suspicious goings-on at City Hall.

But Babiš said Rakušan is the "head of the hydra" and that by leaving him in government, "Fiala approves of STAN's mafia and robbery practices."

Still, the pro-EU alliance will do everything it can to stick together. A crumbling of the STAN movement could leave the door open for controversial former leader Babiš to lay a new claim to power, possibly in coalition with the hard-right eurosceptic Freedom and Direct Democracy (SPD) party.

Babiš remains at the centre of a scandal of his own, accused of committing EU subsidy fraud in 2007. A trial date for the "Stork's Nest" case against the ANO party leader has been set for September this year.

It was hoped that the Czech Republic had entered a new era in which such sleaze would be rooted out for good. But it's feared a lingering culture of deceit and greed has been revealed under the smooth veneer of its anti-corruption movement.