Operational programme Human Resources Development went with serious shortcomings
Press Release – January 21, 2009
From February to October 2008, auditors from the Supreme Audit Office (SAO) performed an audit that focused on programmes and projects of pursuing the state active employment policy, which were co-financed from the European Social Fund (ESF) within the period from 2004 to 2007. Among the audited bodies were several selected aid beneficiaries and the labour offices in České Budějovice, Karlovy Vary, Hradec Králové, Olomouc, and in Plzeň.
“The auditors revealed insufficiencies that outreach CZK 646 million, including serious violations of the budgetary discipline that amount to CZK 39.7 million altogether. The mistakes make roughly 48 % of the controlled finances and consist mostly in paying out sums, which did not respect the basic requirements of EC regulations“, said president of the SAO František Dohnal.
The Programme’s managing authority, which was the Ministry of Labour and Social Affairs, did not fix for the process of evaluation of grant projects sufficiently clear and authoritative rules to guarantee a uniform approach on the part of aid providers in the Programme.
“The project entitled ‘Podpora zaměstnávání v obcích a v organizacích neziskové sféry a rekvalifikace‘ (Supporting the employment in towns, in non-profit making organizations, and retraining) was launched by the Ministry with the evident intent of exhausting ESF allocations for the year 2005 to prevent forfeiture as a consequence of the rule ‘n+2’. The Project was implemented through refunding state budget funds from the ESF in the amount of approximately CZK 280 million spent to pursue the state active employment policy. Based on the Project execution, basic requirements of the EC regulations for eligibility and guaranteeing publicity could not be respected and were not respected”, said František Dohnal.
The principle of transparency and equal treatment was not adhered to in the process of application assessment. „During the realization of the project entitled ‘Pomoc dlouhodobě nezaměstnaným na Ostravsku a Mostecku‘ (Financial aid for the long-term unemployed in the Ostrava and Most regions), the Ministry awarded a public procurement worth almost CZK 150 million excluding VAT to a bidder who had not fully met the eligibility criteria and should have been disqualified from the competition. The Ministry also breached the budgetary discipline when implementing the Project as it repeatedly paid the contractor without having a proper documentation and defrayed the contractor’s costs for uneconomical services. The Ministry did not proceed in the most economical manner when it entered into a contract and allowed a price rise higher than the value of the original order“, said František Dohnal.
On the basis of the monitoring indicators set by the Ministry, it will be difficult to assess objectively the degree to which the objectives are attained and the actual impact of the priority on active employment policy. Preliminary controls preceding obligations were carried out at the level of the Ministry with serious shortcomings and did not achieve their main purpose, which was to verify the regularity of operations before they were undertaken. Some shortcomings were also in preliminary controls before making payments, when the claimed sums had been paid out before the payment request was authorised, at a time when the amount of the liability paid out could not be verified.
The auditing operation was included into the 2008 Audit Plan of the SAO under No. 08/06. Marie Hošková, Member of the SAO Board, controlled the operation and prepared the audit conclusion as well.
Radka Burketová
Press Speaker
Supreme Audit Office