Management of national park administrations: weaknesses in procurement procedures and leases. No clear strategy to finance and develop national parks.

Press release on audit 18/23 – 7 October 2019

The Supreme Audit Office has scrutinised the management of the state’s assets and funds under the management of national park administrations between 2016 and 2018. It has identified a number of minor shortcomings concerning the leasing of property, public procurement, and accounting. In order to finance the national parks in the future, the decline in prices and volume of timber sold can be problematic, as sales revenues represent a significant share of revenues of the national park administrations. Moreover, the Ministry of the Environment (MoE) has not developed yet a concept to address the issue of national parks in the Czech Republic in the future, their financing included.

The national park administrations manage assets for more than CZK 7 billion. The SAO examined the management of all four. It was discovered, for example, that the of the Krkonoše Mountains National Park Administration acted in an uneconomical way when renting its lands. It leased a plot for a chairlift and a slope at a price of more than CZK 861 thousand lower than the annual rent rates specified in the contract.

Auditors also found errors in the public procurement. The Administration of the Bohemian Switzerland National Park did not act according to law when awarding two above-the-treshold public procurement contracts amounting to more than CZK 20 million. For two tenders in total of more than CZK 1 million, the Administration of the Podyjí National Park did not announce public procurement in which it would have been able to choose from among several offers but it awarded these tenders directly to one supplier.

“Deficiencies in the financial management are one thing. But it is also important that the national park administrations have to cover a large part of their revenues from sales of timber. However, these will fall in the coming years and the state has no clarity about how to deal with funding of the national parks and their further development,” said Petr Neuvirt, head of the audit.

The national park administrations provide the environment protection and receive funds for their activities from the Ministry of the Environment, subsidies, and their own resources. In 2018, their costs amounted to almost CZK 1.1 billion from which around 44 % were covered by the sales of timber. Owing to natural influences and an outbreak of pests, the timber production in the national parks increased. It was by 61 % higher in 2018 than in 2016. The situation is similar in other forests as well. As a result, the selling price of timber is decreasing, both on the Czech and the European market. In subsequent years, the revenues from sales of timber will not be so significant, implying a risk for the funding of national park administrations. This should be addressed by the concept of multi-source financing of care for nature and the landscape. The Ministry was obliged to set it up by 2017 but it has not yet been drafted, and the next term has been set by the Ministry for 2020.

The SAO also found out that due to the ambiguity in the Nature and Landscape Protection Act there had been transfers of nature-valuable land located in the territory of the national parks which had not been offered to the state first. For example, in the case of the Administration of the Krkonoše Mountains National Park, the MoE records 600 such cases. By ransom of these lands, the state could broaden naturally valuable areas, which fall under its administration, and could manage it more efficiently.

Communication Department
Supreme Audit Office

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