Business has moaned for years that the bureaucracy is holding the country back. The numbers support that complaint. The Czech Republic was the second worst in the comparative group, and 11% below the EU average on the whole.

The problem did not lie in too many bureaucrats, or even in the cost of bureaucracy - although the social contribution rate is one of the highest in the world. The issue was with its efficiency.

In 3 out of the 7 cost indicators, Czech public administration costs less than its EU peers. Both effective personal tax rates and interest costs as a percentage of total government revenue are significantly lower than the EU average. The total tax rate - both as a percentage of GDP and profit - in the Czech Republic are about average. In two areas, however, the country has dangerous disadvantages: social contributions and government deficits.

Efficiency is an entirely different story. In 8 of 12 measurements, the country is at a competitive disadvantage with Europe. One of the two bright spots of advantage, the social benefit payments to social contribution ratio directly results from the disadvantageously high costs of the system. The other - the days to start of business - results from a recent reform. More such reform is apparently needed.

The danger of continuing the status quo in social security throbs through the numbers. The cost to the economy is one of the world's worst. At the moment, the benefits paid ratio to contributions received ratio is among the best in Europe, but the country still pays 11% more in benefits than it receives. Administrative costs are 9% higher than the European average (only Slovakia is worse in the comparative group); reform could begin there.

Procedural reform is equally necessary. Given the country's performance in other areas, the poor results in administrative efficiency cannot be excused by a lack of competence. There is no reason why the Czech Republic should be nearly 75% below the European average in the number of days it takes to prepare taxes, or why it should be 46% below the European average in the number of days it takes to register property. The Czech Republic should not lag more than 250 days behind Bulgaria in the time it takes to enforce a contract.