Road and Motorway Directorate remedied its management, with the exception of costs related to external legal services
PRESS RELEASE on Audit No. 16/22 – May 22, 2017
The Supreme Audit Office (SAO) performed an audit at the Road and Motorway Directorate and focused on the management of their assets in the period from 2013 to September 2016. Auditors did not scrutinize activities related to the road and motorway system development. The SAO carried out the audit at the General Directorate and local administrative units in Prague, České Budějovice, Liberec, Olomouc, and Pilsen. Auditors verified whether remedies had been implemented, which followed from the previous audit in 2013 and concluded that most deficiencies had been addressed, with the exception of costs of external legal services. Auditors did not find any serious errors in the Directorate’s management of their assets.
Problems nevertheless persisted in relation to costs of legal services. The Road and Motorway Directorate were using legal services under old contracts, which the SAO criticised already in 2013. The contracts were in force until November 2010 with hourly rates that ranged from CZK 3,500 to 4,800. During the audited period, the Directorate paid CZK 206 million in total for legal services in spite of the fact that the SAO had demanded that the Directorate correct the procedure by March 2014. In the end of 2016, new contracts were signed with new rates ranging from CZK 800 to 1,800 per one hour.
At the Road and Motorway Directorate, costs of legal services decreased during the audited period. In 2015, costs of external legal services were half the amount spent in 2013. However, the number of employees with the legal department of the Directorate increased, but external layers were still hired for tasks, which could have been done by own employees. These tasks included simple administrative formalities related to public contracts, making internal regulations, and creating template documents for the Directorate.
In 2013, the Road and Motorway Directorate sub-divided a tender concerning legal services related to the toll system operation so that the estimated contract value would not exceed the limit set by the law. As a result, services were ordered as small scale public procurements without tendering and the Directorate signed a dozen contracts with one agency and paid CZK 3,500 per one hour.
Auditors also pointed out that the General Directorate’s offices in Prague are located in three private buildings. In 2015, the renting costs amounted to CZK 45 million. The Directorate wanted to build own premises on unused grounds in Prague 4, but the negotiations with the Ministry of Transport have been unsuccessful.
Communication Department
Supreme Audit Office