01/02/2011
The Public Procurement Law should be discussed widely with the beneficiaries to reach a maximum support
Monika Panayotova is a Bachelor in International Relations and Master in International Economic Relations with specialization "Management of International Projects" of University of National and World Economy. She was Director of “Projects and Public Relations” in the Economic Policy Institute. She was elected to parliament as a majority candidate of GERB 24th Constituency-Sofia; Chairwoman of the youth organization of GERB. She is currently Chairwoman of the Committee on European Affairs and oversight of the EU funds.
- Ms Panayotova, last week the committee that you headed, announced the annual report on management of EU funds in Bulgaria. What are the most important findings in it?
- There are received about 10% of EU funds and agreed 36.74 percent, which means that beneficiaries actually received 1.6 billion levs. Let me mention also that from December 2009 to December 2010 there were paid 1.2 billion levs. The conclusion we draw is that there is sustainable growth of absorption and negotiation of the resource. The figure 10% itself is not much, but given the delays over the years, I think this is a significant success for the country. Regarding the agreed resources on first positions remain the OP "Human Resources", "Regional Development and Administrative Capacity”. According to the indicator rate of payment on the first place are OP "Administrative Capacity", "Competitiveness” and “Regional Development”. But to be honest, we must say that outside the JEREMIE instrument real growth of utilization of OP “Competitiveness” is about 2.34%. Programme for rural development compared with other 7 OPs marked the highest percentage of utilization of resources - 19 percent and 37% agreed from the funds. Strong growth of the OP "Regional Development" can be explained by making direct contact with beneficiaries who are mainly the municipalities. Low levels of negotiation, but with good financial performance are programs “Transport” and “Technical Assistance”. Poor performance, accumulated delays, but taken for compensation in 2011, is our assessment for program "Environment”. In summary we can say that in 2009 our country was the only one in the EU, which had no positive assessments and this blocked the interim payments. Following receipt of these assessments there were the payments were granted, which is very important in a crisis. As a result of the undertaken institutional, administrative and legislative measures now we have a stable system of coordination and control of EU funds. There is a sustainable growth rate of resource utilization. The system opens.
If you have to sort the problems on whose solution depends the acceleration of the process, which will you place in the beginning?
- The two main problems are still the insufficient administrative capacity and the Public Procurement Law / PPA. A working group under the LPP have already been formed. Changes will be essential and will accelerate the procedures next year, because most of the funding goes under this Act. Our recommendation is that the draft should be widely discussed with the beneficiaries to reach a wide support. The insufficient administrative capacity is a problem that still exists and it is reported in the interim and the annual report of the Committee. We see that measures are taken. On the one hand, the possibility to use specific expertise from international financial institutions opens. This will be within the program "Technical assistance" and will not affect the budget. On the other hand - the JASPERS initiative will set up panels of experts who will help direct beneficiaries. It is also important to seek an opportunity to accelerate and simplify procedures. European funds will become available to more beneficiaries when the documents are unified and the bureaucratic burden is reduced. Control is really important but it should be understood that more administration and bureaucracy does not mean more effective control.
- Administration has not learned quickly to handle the projects yet, or beneficiaries are not able to make good suggestions?
- Everything depends on the concrete operational program. For example, in OP “Transport” beneficiaries are government agencies, and for OP "Environment" are municipalities. It is quite different in the program "Human Resources", in which a beneficiary is the NGO sector, which over the years failed to properly prepare. In OP “Competitiveness” the initiative is fully in the business. Available information is very important and it is a good step that 27 information centers will be created in order not to concentrate everything in Sofia. And another - last year the rate of turnover among the administration is much lower, which means that additional funding was able to retain experts.
- When a special law for EU funds will be adopted?
- We have over 20 ministerial decrees governing this matter at the moment. There should be considered a law on European funding, which will enable the settlement of public relations and greater legal certainty. If it is a time for a new institutional framework, it would be important to be introduced by a law. This will also show a clear national vision for the management of EU funds. This law will work in the next programming period. If we take this step now, it is likely to accommodate the confusion and the process to be delayed. But we recommend unification of application and accounting documents to be considered. Concentration should be not so much on the form of reporting the projects, but rather on their performance and thus to seek the maximum impact on society and citizens. As there is a discrepancy between the numbers of governing bodies, the Information System for Management and Monitoring and the National Fund, it is important to achieve data synchronization in order not to get different interpretations.
In your opinion why the OP “Competitiveness”, which all call the program of business is going the slowest?
- 198 million euro were transferred to venture capital and 1 million euro to provide for so-called “business angels”. The question now is the means that are considered utilized to reach real business. I think we need to use the experience of the program "Regional Development” and “Human Resources” for direct contact with beneficiaries. It is now clear that we need closer interaction with business and further information on procedures. JEREMIE initiative itself is successful because it will help the venture business. The issue now is as soon as possible to make Holding Fund work and the beneficiaries take advantage of it and avoid the risk of reflux of interest in the program.
- In recent days the letter from Commission President Jose Manuel Barroso is being commented, which is actually from the middle of December. What is your comment?
- The main problem areas that are pointed are OP "Transport” and “Environment”. The problem of the OP" Transport "is that over the years a delay has been accumulated. Error of this program is from the beginning because concentration of heavy infrastructure projects is allowed without the necessary readiness. This should not be repeated in the next programming period. A good example is the launch of “Trakia” motorway project, before the approval of Application form by the Commission in order not to delay implementation. Of course, there should always be recognized that such cases also pose risks. There should be paid attention to the railway transport, which shows low levels. “Trakia” motorway and metropolitan subway improve absorption, but we call for seriously intensification of construction activities concerning other projects. OP "Environment" is essential for the reform in the water sector and we think that we must strengthen the capacity of municipalities, which are the main beneficiaries. If there is no project readiness in priority agglomeration, it is better to consider and to redirect funds to agglomerations with less than 10 000 inhabitants.
The Public Procurement Law should be discussed widely with the beneficiaries to reach a maximum support
Monika Panayotova is a Bachelor in International Relations and Master in International Economic Relations with specialization "Management of International Projects" of University of National and World Economy. She was Director of “Projects and Public Relations” in the Economic Policy Institute. She was elected to parliament as a majority candidate of GERB 24th Constituency-Sofia; Chairwoman of the youth organization of GERB. She is currently Chairwoman of the Committee on European Affairs and oversight of the EU funds.
- Ms Panayotova, last week the committee that you headed, announced the annual report on management of EU funds in Bulgaria. What are the most important findings in it?
- There are received about 10% of EU funds and agreed 36.74 percent, which means that beneficiaries actually received 1.6 billion levs. Let me mention also that from December 2009 to December 2010 there were paid 1.2 billion levs. The conclusion we draw is that there is sustainable growth of absorption and negotiation of the resource. The figure 10% itself is not much, but given the delays over the years, I think this is a significant success for the country. Regarding the agreed resources on first positions remain the OP "Human Resources", "Regional Development and Administrative Capacity”. According to the indicator rate of payment on the first place are OP "Administrative Capacity", "Competitiveness” and “Regional Development”. But to be honest, we must say that outside the JEREMIE instrument real growth of utilization of OP “Competitiveness” is about 2.34%. Programme for rural development compared with other 7 OPs marked the highest percentage of utilization of resources - 19 percent and 37% agreed from the funds. Strong growth of the OP "Regional Development" can be explained by making direct contact with beneficiaries who are mainly the municipalities. Low levels of negotiation, but with good financial performance are programs “Transport” and “Technical Assistance”. Poor performance, accumulated delays, but taken for compensation in 2011, is our assessment for program "Environment”. In summary we can say that in 2009 our country was the only one in the EU, which had no positive assessments and this blocked the interim payments. Following receipt of these assessments there were the payments were granted, which is very important in a crisis. As a result of the undertaken institutional, administrative and legislative measures now we have a stable system of coordination and control of EU funds. There is a sustainable growth rate of resource utilization. The system opens.
If you have to sort the problems on whose solution depends the acceleration of the process, which will you place in the beginning?
- The two main problems are still the insufficient administrative capacity and the Public Procurement Law / PPA. A working group under the LPP have already been formed. Changes will be essential and will accelerate the procedures next year, because most of the funding goes under this Act. Our recommendation is that the draft should be widely discussed with the beneficiaries to reach a wide support. The insufficient administrative capacity is a problem that still exists and it is reported in the interim and the annual report of the Committee. We see that measures are taken. On the one hand, the possibility to use specific expertise from international financial institutions opens. This will be within the program "Technical assistance" and will not affect the budget. On the other hand - the JASPERS initiative will set up panels of experts who will help direct beneficiaries. It is also important to seek an opportunity to accelerate and simplify procedures. European funds will become available to more beneficiaries when the documents are unified and the bureaucratic burden is reduced. Control is really important but it should be understood that more administration and bureaucracy does not mean more effective control.
- Administration has not learned quickly to handle the projects yet, or beneficiaries are not able to make good suggestions?
- Everything depends on the concrete operational program. For example, in OP “Transport” beneficiaries are government agencies, and for OP "Environment" are municipalities. It is quite different in the program "Human Resources", in which a beneficiary is the NGO sector, which over the years failed to properly prepare. In OP “Competitiveness” the initiative is fully in the business. Available information is very important and it is a good step that 27 information centers will be created in order not to concentrate everything in Sofia. And another - last year the rate of turnover among the administration is much lower, which means that additional funding was able to retain experts.
- When a special law for EU funds will be adopted?
- We have over 20 ministerial decrees governing this matter at the moment. There should be considered a law on European funding, which will enable the settlement of public relations and greater legal certainty. If it is a time for a new institutional framework, it would be important to be introduced by a law. This will also show a clear national vision for the management of EU funds. This law will work in the next programming period. If we take this step now, it is likely to accommodate the confusion and the process to be delayed. But we recommend unification of application and accounting documents to be considered. Concentration should be not so much on the form of reporting the projects, but rather on their performance and thus to seek the maximum impact on society and citizens. As there is a discrepancy between the numbers of governing bodies, the Information System for Management and Monitoring and the National Fund, it is important to achieve data synchronization in order not to get different interpretations.
In your opinion why the OP “Competitiveness”, which all call the program of business is going the slowest?
- 198 million euro were transferred to venture capital and 1 million euro to provide for so-called “business angels”. The question now is the means that are considered utilized to reach real business. I think we need to use the experience of the program "Regional Development” and “Human Resources” for direct contact with beneficiaries. It is now clear that we need closer interaction with business and further information on procedures. JEREMIE initiative itself is successful because it will help the venture business. The issue now is as soon as possible to make Holding Fund work and the beneficiaries take advantage of it and avoid the risk of reflux of interest in the program.
- In recent days the letter from Commission President Jose Manuel Barroso is being commented, which is actually from the middle of December. What is your comment?
- The main problem areas that are pointed are OP "Transport” and “Environment”. The problem of the OP" Transport "is that over the years a delay has been accumulated. Error of this program is from the beginning because concentration of heavy infrastructure projects is allowed without the necessary readiness. This should not be repeated in the next programming period. A good example is the launch of “Trakia” motorway project, before the approval of Application form by the Commission in order not to delay implementation. Of course, there should always be recognized that such cases also pose risks. There should be paid attention to the railway transport, which shows low levels. “Trakia” motorway and metropolitan subway improve absorption, but we call for seriously intensification of construction activities concerning other projects. OP "Environment" is essential for the reform in the water sector and we think that we must strengthen the capacity of municipalities, which are the main beneficiaries. If there is no project readiness in priority agglomeration, it is better to consider and to redirect funds to agglomerations with less than 10 000 inhabitants.
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