The Supreme Audit Office (SAO) found shortcomings in drawing European subsidies in Prague, so the European Union would not have to reimburse some projects. According to a report released today by the office, some recipients of subsidies made mistakes in tenders for suppliers, while some violated budgetary discipline. The SAO also criticizes the Prague City Council for managing and controlling the operational program. The SAO forwarded some of the findings to the tax office, which may impose sanctions on the beneficiaries.
The SAO is recommended to use 127.5 million euros (about 3.25 billion crowns) for the Prague Adapt Operational Program (OPPA), in which 127.5 million euros (about 3.25 billion crowns) are reserved. The program supports non-investment projects aimed, among other things, at further vocational education, social integration or the modernization of secondary and higher education. The SAO inspected both selected projects and how the municipality manages the program. The Office examined the distribution of about 423 million crowns.
The executive office ensures that the Prague City Council manages the program and is also its auditor. Although the activities are performed by two different departments of the municipality, according to the SAO, this “risks not maintaining the independence of the function” of the auditor. “This problem was also the case with other regional operational programs,” SAO spokesman Jaroslav Broža told ČTK. According to him, the EU demands that control be moved elsewhere. In the future, it could probably be provided by the Ministry of Finance.
According to the SAO, it is also a mistake that the municipality does not have sufficient information about the course of the program. Thus, the program cannot be evaluated or adjusted according to the identified shortcomings. “The municipality of some OPPA monitoring indicators has set and assessed in such a way that it is not possible to verify the progress in achieving the OPPA objectives or to evaluate the efficiency and economy of the funds spent,” he said in the SAO report.
Although this is an operational program focused on Prague, the municipality, according to the inspection, has set the conditions so that even applicants without ties to the Prague region can obtain a subsidy. “Out of a sample of 200 monitored persons selected for inspection, 40 of them have their place of business, resp. the seat of the business, outside the territory of the capital city of Prague, “the report states. According to the SAO, such a significant part of the expenditure could be considered “ineligible” and the EU would therefore not reimburse.
According to the Office, some grant recipients did not comply with the conditions for granting the aid. They made mistakes mainly in the selection of suppliers, in bookkeeping or in fulfilling the project goals. For example, Prague 10 canceled the tender, did not do any other and directly addressed the service providers (four lecturers of the University of Finance and Administration) and concluded contracts with them in the amount of 762,400 crowns. At the same time, the only bidder in the canceled tender won a prize of 446,249 crowns.
The capital, on the other hand, did not exclude candidates who did not meet the qualification conditions in the tender for the provider of further education of employees. This bidder was then selected as a contractor for the project, for which a subsidy of 18.8 million crowns should be allocated.
Some of the offenses were assessed as a breach of budgetary discipline, and the SAO therefore forwarded the findings to the tax office, which may impose sanctions on the beneficiaries.