Auditing operation No. 03/27
Funds earmarked to Regional Operational Programmes at NUTS II level
The auditing operation was included in the Annual Audit Plan of the Supreme Audit Office (hereinafter referred to as „SAO“) for the year 2003 under No. 03/27. The auditing operation was managed and audit conclusion drawn up by Ms. Marie Hošková, the Member of the SAO.
The aim of the audit was to examine the providing, the drawing and the usage of the funds earmarked for the Regional Operational Programmes (hereinafter referred to as „ROP“) at NUTS II level, including the evaluation of the expected aims and benefits.
The audited period covered the years 2000 to 2003.
The audited bodies were Ministry for Regional Development (hereinafter referred to as „MRD“), Centre for Regional Development (hereinafter referred to as „CRD“) and twelve selected beneficiaries.
The auditing operation focused on grant schemes under the pilot Regional Operational Programmes at NUTS II level, introduced to test the Czech Republic’s preparedness for managing the EU Structural Funds at regional level and to support regional development. There was a change in the preparation for Structural Funds management, namely that their proceeding will be based on a Joint ROP, and not on individual ROPs. Still, the deficiencies identified by the audit can have a negative impact on Structural Funds management:
- It took two years to prepare the grant documentation under the ROPs, select 53 projects and sign the grant contracts. This is significantly longer than the project implementation phase, set at five to nine months. The envisaged implementation phase proved unrealistic due to time-intensive and administratively complex public procurement process and had to be extended up to 11 or even to 20 months in all the 43 implemented projects. As a result, relatively simple projects (such as refurbishment of the squares and access roads) executed under the pilot ROPs could take as long as 37 months, i.e. more than 3 years, from the drafting of the grant documentation to execution;
- More than 20 % of the allocated aid has not been used as envisaged since ten grant contracts were terminated early, out of which seven due to the fact that the CRD did not comply with the valid rules and failed to consult changes with the Delegation of the European Commission in Prague;
- In the North West, Moravia-Silesia and Central Moravia regions, which were selected as the pilot regions, the MRD failed to establish a functioning system to evaluate the benefits of ROP implementation, since the entry data were either missing or not updated. Meanwhile, in approximately one half of the projects there was no clear direct relation with the grant scheme objectives, i.e. small and medium-sized business, spa and tourism development.