Published Wednesday, July 23, 2008 at 15:31
by
arktika 
(1096 views and 0 comments)
As today’s headlines were dominated by news that the European Commission is to withdraw hundreds of millions of euros worth of EU funding to Bulgaria and to withhold their right to manage such funds, Ari Rusila asks how much of the misuse of EU funds is really down to corruption and organised crime?
Ari claims that perhaps the real crime is preoccupation with details and bureaucracy, and that EU officials are the culprits.
The European Commission is set to withdraw the accreditation of two Bulgarian agencies and bar them from using EU funds after details of a European Commission report on Bulgaria’s fight against corruption and organised crime will be officially issued on July 23. Two agencies under the Ministry of Regional Development and Public Works and the Finance Ministry will lose their permits to operate with EU funding under the bloc’s pre-accession programme PHARE. This could deprive Sofia of about €600 million. Two other agencies/programmes could meet the same fate.
The average reader may think that some clever crocks have pocketed a nice sum because the report highlights corruption, organized crime and economical fraud activities in Bulgaria. Undoubtedly these kinds of crimes have happened. However the question about administration of EU funds is more complex than simple crimes. I have worked with EU projects for some 15 years and would like to bring forward some other aspects from field-level project management.
EU has some 500-800 different programmes from where individual projects can derive 10-100 % financing of their costs. There are some general guidelines, but nearly every programme also has individual regulations, practice and details. For administration it is a huge task to manage, coordinate and implement this puzzle.
EU funding/payment can be delayed or revised e.g. if a project manager has offered coffee to participants during training session in one programme when this is allowed with other EU programmes. Also he can make mistake by using real exchange course in payment claim when only monthly average course is allowed. Most projects need their own or SME financial contributions but sometimes according one programme rules it comes from too big a company, or a company is on the wrong side of a municipal border while implementing a regional development project. In payment claims some costs can be in the wrong budget line or the project manager may have forgotten for to ask permission for an amendment/revision decision from Management. Some times it is also difficult to interpret if part of project partners´ administrative work is its normal development work (ineligible cost) or strictly project development work (eligible cost).
So there are different regulations which are eligible costs in each project depending from which programme the main financing is coming. Many times when the programme period changes even the EU officials do not know all the details which to apply on the beginning of programme period - how then could the project manager or province/state level managing authority forecast them?
Before mentioned boring details give a picture about bad project management, when similar details occur with most of the projects one can judge the situation as bad programme/EU fund management. But one can also see that these kind of details are far away from the organized crime scene.
What is a crime from my point of view is that most EU officials/Management Authorities are more interested about small financial details than the outcome of programmes/projects. It is possible to keep budget lines, make a perfect financial report where every cent is in right place without any impact on the field. It is also possible to implement a project with excellent results, superb beneficiary feedback, with many spin-offs and follow-ups but which, following an insufficient financial report, will be deemed as a failure.
In accordance with my opinion, the EU should shift the emphasis of the activity from financial nitpicking to a goal orientated approach and the first question from EU officials should be the results on the field. The priorities could include the following:
In the case of Bulgaria, I do not know how much of the question is down to corruption, organized crime, etc. and how much it is down simply to problems with applying complex EU bureacracy in new member state. However, as a taxpayer I would like to see EU concentrating on big lines in the real world instead of detail honing between specialists about topics whose influence on the average citizen are close to zero.
For more comments one can search on http://arirusila.wordpress.com/
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