Post-term severance as a [paid] holiday leave

Mirko Zgonjanin, a member of a committee in the Municipal Assembly of Novi Grad, says that “post-term severance” is unnecessary because officials are high earners anyways and have enough time to save. Yet, he himself applied for a six-month allowance after his term as a Speaker of the Assembly expired in 2020. Thus, in six months, he received BAM 21,000 marks in “post-term severance.”

“If others did it and collected this perk, why would I give it up”, said Zgonjanin, a member of the Demokratski narodni savez [Democratic People’s Alliance].

He is the owner and general manager of Astorija Company, which in 2020 made a profit of BAM 18,000. He claims to have left the company before coming to the position of Assembly Speaker, but as soon as he collected his post-term severance he registered as an employee of his company.

City mayors, municipality mayors, speakers, and deputy speakers of local assemblies in Republika Srpska (RS) are entitled to “a post-term severance” for six months, just like advisors in the Federation of Bosnia and Herzegovina (FBiH). However, the other politicians in this Entity (FBiH) may enjoy this perk for a year. This money is meant to help them [bridge the economic hardships] until they find a new job or retire.

According to data collected by CIN journalists, from November 2020 to January 2022, 51 municipalities in Bosnia and Herzegovina (BiH) should pay almost BAM 1.5 million in “post-term severance” to 81 officials.

Among them are 34 politicians who collect this perk even though they have their own companies or have in the meantime won new seats in the assemblies. Such a practice is possible due to imprecise rules, which are interpreted in most municipalities for the benefit of politicians.

“Post-term severance” as a life-jacket for poor business

Applications for “post-term severance” are approved by municipal selection and appointment commissions and their role is mainly reduced to formal confirmation of the applications because the rules do not define the circumstances in which such applications can be rejected, and the criteria differ significantly between municipalities. It is, for example, prescribed that politicians are not entitled to “post-term severance” if they are employed, but it is not determined whether this provision applies to those who hold private businesses.

This is why private individuals collect salaries from public budgets while at the same time managing their businesses, though temporarily resigned from that job.

Halil Jašić from the Stranka demokratske akcije [Party of Democratic Action] is the former deputy speaker of the Municipal Assembly of Milići and the owner of the grocery store “Mirza”. After he was elected deputy speaker of the Assembly in 2018, Jašić resigned from the registered position he held in his store. The same day he collected his last “post-term severance” slip, he went back to his old job. In six months, he collected BAM 7,200 in post-term severance.

“They told me I am entitled to this perk if my company’s status is poor if the store is not undergoing some major development”, Jašić told CIN, adding that everything was by the law.

His party colleague, Ajdin Mešić, former speaker of the Prijedor City Assembly is the co-owner of the metal processing company “CNC power” and the owner of the business consulting company “2A connections”. In 2020, they maid a profit of BAM 38 thousand. Thanks to “post-term severance”, he collected 21 thousand in half a year.

Former Deputy Mayor of Šekovići Municipality, Slaviša Mrkajić (SDS), is the owner of the clothing company “Konfekcija Maja”. He told CIN that he would no longer be involved in politics and that he had a company, only to change the story a few moments later.

“Yes, I sold the company to the Italians. Yes, I shut it down. I’m not doing anything anymore.” According to court records, Mrkajić is still the owner of the company he claims he sold three years ago.

The former deputy mayor of Rudo Municipality, Mitar Vidaković, also has a company – “MMR-BraćaVidaković”, which deals with wood processing. In six months, he collected BAM 12,800 in “post-term severance“.

“Currently, it is only my brother who works in the company, keeping it alive”, says Vidaković.

Former speaker of the Municipal Assembly of Osmaci, Milan Popović from the Narodni demokratski pokret [People’s Democratic Movement] also enjoyed the privileges of working in the public administration. He was the owner of a cafe, which he transferred to his wife in 2018.

“When I realized that this state apparatus is a nice cash cow and that one should make an effort to somehow get in (…) never in my life did I know of hot meal allowance, paid holiday leave, allowance for winter, heating until I made it to a state institution. And, when you make your way in, you should really make an effort to stay for as long as possible. There are lots of perks.”

Popović would like to spend his entire career in the “state apparatus”: “I would only like to go in the ministry if I could.” While looking for a job, he collected BAM 13,620 in “post-term severance“.

According to lawyer Miloš Stevanović the problem is that under the law, the right to “post-term severance” ceases only in the case of employment or retirement because the law does not take into account any other ways of earning.

“It often happens that these persons, who suspended their employment status after being elected to a certain function, do not activate their employment status after the expiry of the term but instead wait until they use the “post-term severance”. The latter is a matter of real abuse of rights and does not belong to the domain of the previously mentioned legal procedures i.e., procedures that are a matter of morality “, says Stevanović.

Post-term severance as a favorite perk

Apart from Zgonjanin and Popović, two other politicians, who are owners or co-owners of companies, collected post-term severance. They continued their engagement as councilors after their mandates in leading positions expired. Although they had the opportunity to immediately start receiving fees as councilors, they first opted for collecting post-term severance because the amounts are many times higher.

The same did former officials in the municipalities of Derventa and Kostajnica, Marijan Kljajić from the Hrvatska demokratska zajednica BiH [Croatian Democratic Union of BiH] and Goran Rabat from the Srpska demokratska stranka [Serbian Democratic Party].

In late 2020, Rabat started a business with the transport of asphalting bitumen. He says that he has not been earning much lately, so “post-term severance” came in handy. He collected BAM 11,800 in half a year.

“I think it is difficult for an official who worked in a municipality or at a higher level of government to find a job in a short time i.e., a job of that level, for example – deputy mayor, where he is an official,” says Rabat.

His colleague from Derventa, Marijan Kljajić, in half a year collected BAM 24,600 in post-term severance. He owns two companies in Croatia: “IL-MA promet” and “Autoprijevoznik Kljajić”, which he reported in the 2016 asset declaration report as property worth five million marks. He did not respond to calls from journalists.

Unlike the two of them, the former mayor of Čelinac, a member of the Savez nezavisnih socijaldemokrata [Alliance of Independent Social Democrats], Momčilo Zeljković, collected both benefits at the same time. He has shares in the company “Premium osiguranje” a.d. Banja Luka, worth BAM 126,500, but he did not want to talk to journalists about it.

Former mayor of the Sarajevo municipality of Centar and SDA official, Nedžad Ajnadžić is the owner of the trade and catering company “Ajnex”, which founded the kindergarten “Osmijeh”. Last year, these companies together generated a profit of BAM 24.670.

“I can take a dividend, I can take what I want, but I don’t take anything. I invest everything in the development of the company and I plan to make 2-3 more companies. To give people jobs.”

Instead of collecting dividends from his companies, Ajnadžić will receive a little more than BAM 51 thousand in post-term severance from the municipal budget in a year. Although these are official data that CIN received from the Municipality of Centar, Ajnadžić claims that the amount is not accurate, but refuses to say what, in his opinion, is the true amount. He does not worry about finding a job after he collected the post-term severance.

“And as soon as I’m done with it, I’ll be employed, of course.”

Different interpretations of the same law

A total of 22 officials who applied for post-term severance after the expiration of the last mandate, won new mandates in the 2020 Local Elections. This did not prevent them from enjoying the post-term severance because committee members/councilors are not employed in municipal councils and assemblies, but receive a monthly allowance of up to BAM 500. Unlike them, speakers and deputy speakers have the status of employees, so they have to choose between compensation for a new position and post-term severance from the old position.

Due to omissions and non-harmonized rules, the payment of committee and council fees with post-term severance to former city mayors, municipal mayors, and their deputies is not regulated, so municipalities use this legal gap in different ways.
Hence, the former leaders from Bosansko Grahovo, Jablanica, Gacko, Derventa, Čelinac, and Mrkonjić Grad have been collecting both, the post-term severance and the fees for their new positions in committees/councils for months. At the same time, in Pelagićevo, Prijedor, Rudo, Sokolac, Istočno Sarajevo, the applications for double fees have been rejected.

Post-term severance served well Zeljković, the former mayor of Čelinac. During three and a half terms i.e., nearly fourteen years at the head of the municipality, he did not use the annual leave, so the post-term severance was an opportunity for him to “finally get some rest”.

“You do not go to work, but you get paid. To me, that is a [paid] holiday leave”, says Zeljković, who, in half a year, collected about BAM 18,600. After last year’s elections, he was appointed deputy speaker of the Municipal Assembly – a volunteer function for which a fee of BAM 400 is provided. Thus, in addition to getting a paid holiday leave, Zeljković will be paid for his “volunteer work” from the budget.

His party colleague, former mayor of Mrkonjić Grad, Divna Aničić, in addition to severance perk of about BAM 3,0000 simultaneously collected a fee for her committee engagement of BAM 440. Although she could have returned to her old job in the electric power industry – Hidroelektrana na Vrbasu – after the termination of her term as mayor, she opted for post-term severance.

“I think that after 16 years of my work in this municipality – and ask what I left behind and what I did – I deserved from my municipality and my fellow citizens those six salaries, especially given my health condition“, said Aničić, explaining that she took the severance because she was seriously injured and was immobile for several months.

“In a way, that made me decide to go for it because otherwise, I would depend on the Health Insurance Fund.”

Milorad Gligić became the mayor of Bosansko Grahovo in the early elections in 2018 as an independent candidate, although he is a member of the Srpska napredna stranka FBiH [Serbian Progressive Party of FBiH]. In a year, he will receive more than BAM 21 thousand in post-term severance, along with a councilor fee of BAM 250. For each session held, he will receive another BAM 50.

“If I had an opportunity to get a job, I would not use this post-term perk, but in Grahovo it is difficult to get a job, so I was forced to apply for post-term severance. And when I run out of it, it is questionable whether I will manage to find some source of livelihood.”

Former mayor of Jablanica, Salem Dedić, from the SDA and deputy mayors in Gacko and Derventa, Radoica Antunović from the Partija demokratskog progresa [Party of Democratic Progress] and Siniša Jeftić from the SNSD, receive two types of compensation every month. Dedić receives a total of about BAM 3,800, Antunović almost BAM 2,800, and Jeftić a little over BAM 3,600. Dedić and Antunović claim to have taken post-term severance because they could not have returned to their old jobs. Jeftić did not respond to CIN’s calls for an interview. Every month, the municipalities have double allocations from the budget for these six councilors, and in addition to post-term severance they give another BAM 2,300 in fees.

“Perhaps it may make sense for an official who receives a salary called “post-term severance” not to be entitled to any other benefits from public budgets, but again, it should be defined by regulation and not decided on a case by case basis, it should not be done arbitrarily”, says the president of the Committee for Local Self-Government at the National Assembly of the RS, Srđan Todorović.

Although this Committee can initiate the legislative amendments, Todorović claims that this is the responsibility of the RS Ministry of Local Self-Government, while the Ministry shifts the responsibility for the amount and rules concerning committee member fees to local communities.

Macroeconomic analyst, Faruk Hadžić, says that former officials, like any other worker, are entitled to compensation from the employment bureau, which is currently around BAM 350 in FBiH. In his view, the amounts of post-term severance are unjustifiably high.

“In a way, this perk was explained as a compensation for those who cannot find employment in a certain period, which in fact is not entirely true. They cannot find employment in managerial positions in certain state-owned enterprises, but nothing prevents them from being directors, owners, ordinary employees in some other companies”, says Hadžić.