CZK 431 million worth of support for tourism in the regions: even inefficient and uneconomical projects subsidised
PRESS RELEASE ON AUDIT NO 23/02 – 25 March 2024
More than CZK 431 million were spent from the state budget on the National Programme for Supporting Tourism in Regions 2016-2023 from 2016 to July 2023. The subsidies distributed among 375 projects were aimed at increasing the potential and competitiveness of the regions of the Czech Republic, facilitating the movement of visitors in specific destinations or developing the quality of services. However, it is not possible to verify whether these objectives were achieved. As the audit of the Supreme Audit Office (SAO) showed, the Ministry of Regional Development (MoRD) set general and unmeasurable objectives for the use of funds from this programme. It is therefore not possible to assess and measure the benefits of the subsidy for tourism as a whole. The audit showed that flaws in the system allowed for the support of inefficient and uneconomical projects. The SAO also found deficiencies in some of the beneficiaries audited. In five of the 19 projects audited, it found facts indicating a breach of budgetary discipline.
The beneficiary is obliged to submit documentation to the MoRD for the final evaluation of the action. These materials are crucial for the MoRD to assess whether the supported projects have achieved their intended purpose. However, the SAO found that in most cases the MoRD did not check the above-mentioned documentation even three years after the project was completed. Thus, it does not have up-to-date, correct and complete information on the effectiveness of the action. According to the SAO, this is a serious failure of the MoRD's internal control system.
For example, the Ministry did not find out that the place where the exposition of industry, trade and agriculture was supposed to be located was just an empty space with no visible structural modifications. According to the SAO, funds amounting to almost CZK 2 million were thus spent uneconomically and ineffectively. It was not used to pay for the construction work and installation of the exhibitions as declared. Another example of ineffectiveness is the project to build a river sauna on the banks of the Svratka River. At the premises, the SAO auditors found that the building had also been used as a bistro/café. By using the subsidy for the construction of a catering facility, the beneficiary of the support violated the principles of the subsidy programme, according to which support cannot be used for such purposes.
The auditors also pointed out that the MoRD had not even detected some errors that an effective administrative inspection "from the desk" would have been able to reveal. For example, the Ministry did not detect that a planned marketing campaign to promote water tourism on the Labe and Vltava rivers in the Ústí nad Labem and Central Bohemia Regions had not been implemented. Although the beneficiary did not provide any verifiable proof that the campaign had taken place, the MoRD paid more than CZK 702,000 for it. The SAO considers this to be an ineffective and uneconomical use of funds.
Although the MoRD stated in the documentation of the National Programme for Supporting Tourism in Regions 2016-2023 that one of its objectives is to spread the number of visitors over time and territory, the programme has not contributed to the reduction of regional inequalities. According to the SAO auditors, particularly in the case of the 'Marketing' sub-programme, there are many localities where no project has been supported. Most of the projects were supported in the České Budějovice district, while very little support was provided in districts throughout the Ústí nad Labem and Karlovy Vary Regions. The situation is not much better in the districts of the Vysočina Region or the Central Bohemia Region.
For more details see the interactive annex (only Czech).
Communication Department
Supreme Audit Office