State budget funds earmarked for programmes of regional development support
Press release on completion of the auditing operation No. 06/12
The auditing operation was included in the Annual Audit Plan of the Supreme Audit Office (hereinafter referred to as “SAO”) for the year 2006 under No. 06/01. The auditing operation was managed and the audit conclusion drawn up by Mrs. Marie Hošková, the Member of the SAO.
The aim of the audit was to examine the provision, the drawing and the usage of the State Budget funds earmarked for programmes of regional development support and the system of evaluation of expected benefits.
The audited period covered the years 2000 to 2005 as well as previous periods and the period up to the end of the audit in certain cases of relevant connections.
The audited bodies were:
the Ministry of Finance (hereinafter referred to as “MF”), the Ministry for Regional Development (hereinafter referred to as “MRD”), statutory cities Kladno, Liberec, Most, Ostrava, town Čáslav, district Kutná Hora, and others.
The SAO audited the management of the state budget funds earmarked for the MRD and MF Programmes oriented to regional development.
The MF Programme using funds from the General Treasury Administration did not sufficiently justify that needs in the area of regional infrastructures were out of the ordinary. The Programme failed to match even the basic conditions of regional policy, when less than a quarter of the subsidy was allocated to economically or structurally affected regions. A state subsidy form based on suggestions raised by members of parliament goes against basic principles of programmatic financing, which require setting goals, priorities, as well as the financial and time framework of subsidy. The MF allocated in such an unsystematic way CZK 4.4 billion, when subsidies from the MRD programmes covered only about 28 per cent of applicants from economically and structurally affected regions.
None of the audited programmes could be practically evaluated from the point of view of benefit to economical and social development of regions.
The Government called for to replace the national regional programmes by joined programmes financed from the EU Structural Funds together with the state budget funds, but the MRD undertook no step to go on. Taking into account possible problems to ensure co-financing of the EU Structural Funds Projects in the new programme period 2007 – 2013, it is necessary to consider whether to continue the MRD and MF Programmes further or to limit or terminate them and their funds transfer to co-financing of the Structural Funds Projects.
The audit of beneficiaries’ activities found out shortcomings in using of subsidy, public procurement, dealing with acquired property, and bookkeeping.