A new report reveals that in 160 municipalities across the Czech Republic, significantly more people are living in material need compared to other parts of the country. Over the past 15 years, the number of poor residents receiving benefits in these areas has grown dramatically. The findings, published today by the Platform for Social Housing and the For Housing Initiative, point to a troubling rise in what experts call the “poverty business” – a situation where vulnerable tenants are trapped in overpriced and substandard housing.
The report, which analyzes data on housing benefits and subsistence allowances, highlights the growing disparity between these municipalities and the rest of the country. While the number of people in households receiving subsistence allowances nationwide increased by 1.14 times between 2008 and 2023, the growth in these 160 municipalities was five times higher. Similarly, while the number of housing benefit recipients across the country grew by 1.38 times, it skyrocketed by 8.1 times in these impoverished areas.
“I was surprised to find 160 municipalities where the majority of the population relies on housing benefits. When we hear from local authorities about the so-called poverty business, it is not an exaggeration,” said Jan Klusáček, an analyst and co-author of the report.
The data paints a stark picture: in these 160 municipalities, an average of 12 people per 1,000 inhabitants receive housing supplements. In the 40 municipalities with the highest increase in poverty, the figure rises to 18 per 1,000. By comparison, the national average is just five per 1,000. Similarly, while 13 people per 1,000 nationwide receive subsistence allowances, in these municipalities, the number jumps to 31, with the hardest-hit areas seeing as many as 44 per 1,000.
The report suggests that people in financial distress are often forced into substandard housing, paying exorbitant rents for inadequate living conditions. “For 20,000 crowns a month, a family might get a single room in a hostel with a shared kitchen and bathroom or a moldy apartment without windows. This is the same price that would be paid for a standard apartment elsewhere,” Klusáček noted.
The rise in poverty in these municipalities has raised concerns about whether new generations are growing up in entrenched poverty or whether people in need are migrating to these areas. Further analysis is needed to understand the full impact of the so-called poverty business, where a disproportionately poor population is concentrated in certain municipalities, according to the report.
Experts on social issues argue that a comprehensive Housing Act could address the problem of the poverty business. Previous governments have promised such a law, but it has yet to materialize. The government of Prime Minister Bohuslav Sobotka (ČSSD) failed to reach an agreement on the law, and the subsequent cabinet led by Andrej Babiš (ANO) replaced the idea with subsidies and a set of 15 steps that were never fully implemented.
The current five-party coalition government of Prime Minister Petr Fiala (ODS) has committed to passing the Housing Act, but its exact form and how it will be enforced remain unclear. Experts believe that without significant legal reforms, the poverty crisis in these municipalities is likely to worsen, trapping more residents in a cycle of substandard housing and financial hardship.
Source: CTK
