Accents
BCC can play an important role in improving transparency in public procurement
Mr. Renaldo Mandmets, what is your estimation of Bulgaria concerning the absorption of EU funds?
Honestly speaking, the real amount of payments to beneficiaries is only 6%, which is extremely low. If we have in mind the advance payments to beneficiaries, the amount of payments is a little higher but as a whole it remains low. The fulfillment of grants financed by the European fund for regional development has been accelerated in recent months but the really paid funds on the Cohesion fund are alarmingly small 1.6%. This in practice means that infrastructure projects (about one third of Bulgaria’s budget) make progress very slowly. From the information we have, Bulgaria and Romania are one of the last member countries in the absorption of EU funds.
Operational program “Regional Development” however advances relatively well and I do not think that there will be a problem in the absorption of all envisaged funds by the end of the period. Most critical is the situation under OP “Transport” because there were no developed ready projects and the really prepared projects are few. In order to avoid loss of funds in the next program period, Bulgaria should now start preparation for transport projects. I can see a risk concerning OP “Environment” as preparation of projects by municipalities and achieving good quality takes much time and there is no clear decision (clear functions and responsibilities) how exactly should be organized the management of the water sector in Bulgaria.
Absorption depends on many different aspects. I will refer not only to absorption but also to the loss of funds during or after fulfillment of programs and projects. We have a lot of bad examples with the projects under the ISPA program. We do not speak of millions of euro but of hundreds of millions of euro. We do not want Bulgaria to lose the opportunities afforded under the cohesion policy.
Now we have achieved the first and most important thing – we can see political engagement on the part of the government and Minister Donchev. The second important question I think is connected with the management culture in state administration: decision making becomes very slowly (to find a decision on the problem with the borrowed pits on the Danube bridge project took more than 24 months). Delegation and taking personal responsibility is missing. There is not sufficient cooperation between ministries and institutions (on the level of deputy minister work is well but that is not enough). Some procedures are too long and heavy (the Public Procurement Law is extremely complex). Besides, it is not enough to have deputy ministers and a certain number of directors who are good managers. Chiefs of units in agencies should also be good managers. Management culture should be changed – people are afraid of taking decisions and except payment improvement in order to motivate employees the so-called soft managers’ skills should also be improved. Employees who work with end beneficiaries should be aimed at better client service.
We see improvement connected with simplifying of payments but this is not enough. When we see that a certain government decree/decision does not work it should be changed. It is better to take an external expert to estimate the existing systems, procedures and law frame.
Bulgaria loses a lot of funds because of delays caused by the very bad management of contracts. Immediate improvements should start connected with the use of standard documents, better management, improvement of communication, faster decision taking and making compromises if necessary.
The Bulgarian administration began to study good practices from other member countries but they have to be applied. Bulgaria needs strong institutions/agencies to fulfill successfully infrastructure projects in the future.
The Bulgarian Construction Chamber can give advices to parliament, government, ministries in discussion and difficulties in public procurement (documents, processes and laws), projects fulfillment and contract management. BCC can play an important role in improving transparency in public procurement.
Mr. Renaldo Mandmets, what is your estimation of Bulgaria concerning the absorption of EU funds? Honestly speaking, the real amount of payments to beneficiaries is only 6%, which is extremely low. If we have in mind the advance payments to beneficiaries, the amount of payments is a little higher but as a whole it remains low. The fulfillment of grants financed by the European fund for regional development has been accelerated in recent months but the really paid funds on the Cohesion fund are alarmingly small 1.6%. This in practice means that infrastructure projects (about one third of Bulgaria’s budget) make progress very slowly. From the information we have, Bulgaria and Romania are one of the last member countries in the absorption of EU funds. Operational program “Regional Development” however advances relatively well and I do not think that there will be a problem in the absorption of all envisaged funds by the end of the period. Most critical is the situation under OP “Transport” because there were no developed ready projects and the really prepared projects are few. In order to avoid loss of funds in the next program period, Bulgaria should now start preparation for transport projects. I can see a risk concerning OP “Environment” as preparation of projects by municipalities and achieving good quality takes much time and there is no clear decision (clear functions and responsibilities) how exactly should be organized the management of the water sector in Bulgaria. Absorption depends on many different aspects. I will refer not only to absorption but also to the loss of funds during or after fulfillment of programs and projects. We have a lot of bad examples with the projects under the ISPA program. We do not speak of millions of euro but of hundreds of millions of euro. We do not want Bulgaria to lose the opportunities afforded under the cohesion policy. Now we have achieved the first and most important thing – we can see political engagement on the part of the government and Minister Donchev. The second important question I think is connected with the management culture in state administration: decision making becomes very slowly (to find a decision on the problem with the borrowed pits on the Danube bridge project took more than 24 months). Delegation and taking personal responsibility is missing. There is not sufficient cooperation between ministries and institutions (on the level of deputy minister work is well but that is not enough). Some procedures are too long and heavy (the Public Procurement Law is extremely complex). Besides, it is not enough to have deputy ministers and a certain number of directors who are good managers. Chiefs of units in agencies should also be good managers. Management culture should be changed – people are afraid of taking decisions and except payment improvement in order to motivate employees the so-called soft managers’ skills should also be improved. Employees who work with end beneficiaries should be aimed at better client service. We see improvement connected with simplifying of payments but this is not enough. When we see that a certain government decree/decision does not work it should be changed. It is better to take an external expert to estimate the existing systems, procedures and law frame. Bulgaria loses a lot of funds because of delays caused by the very bad management of contracts. Immediate improvements should start connected with the use of standard documents, better management, improvement of communication, faster decision taking and making compromises if necessary. The Bulgarian administration began to study good practices from other member countries but they have to be applied. Bulgaria needs strong institutions/agencies to fulfill successfully infrastructure projects in the future. The Bulgarian Construction Chamber can give advices to parliament, government, ministries in discussion and difficulties in public procurement (documents, processes and laws), projects fulfillment and contract management. BCC can play an important role in improving transparency in public procurement.
