Chaos surrounds euro-funds

THE PROCESS through which organisations can apply for EU funds has been changed, harvesting massive criticism from the opposition, local governments and experts. The Ministry of Construction and Regional Development said the change was to simplify the application process due to difficulties that arose during the previous EU fund-drawing period, when Slovakia was eligible to draw up to Sk400 million.

THE PROCESS through which organisations can apply for EU funds has been changed, harvesting massive criticism from the opposition, local governments and experts. The Ministry of Construction and Regional Development said the change was to simplify the application process due to difficulties that arose during the previous EU fund-drawing period, when Slovakia was eligible to draw up to Sk400 million.

However, Deputy Prime Minister Dušan Čaplovič (Smer), said the ministry's system is defective because it does not provide equal opportunity to all potential applicants.

The ministry introduced a new application process, which involves accepting applications in groups of 54. Once 54 applications have been submitted online, the registration process is temporarily closed while the accepted applications are processed. Only then does a new round of submissions begin.

Moreover, the ministry launched a trial run on February 4 without telling the applicants who submitted proposals for school reconstruction projects that the process was not sharp.

Within a few minutes, 54 applications were registered, preventing others from submitting their applications.

The communities complained that they had had no chance to register, as they had never been informed of when the new procedures would take effect.

Marián Janušek, Minister of Construction and Regional Development, a nominee of the Slovak National Party (SNS), which initiated the change to the system, rejected the claims.

"It [the system] is very well run, but somehow many applicants do not like to read," Janušek told a press conference at the Governmental Office on February 6, 2008. "Everything was clearly stated on the website, so I would like the applicants to be more attentive."

The Association of Towns and Villages of Slovakia (ZMOS) disagrees with the minister.

"It is really an impertinent statement," Milan Muška, vice-chairman of the ZMOS told the public service Slovak Radio on February 6. "Some of our officials were sitting at their computers from midnight until nine in the morning, and they were not able to connect to the server."

The new procedure provoked outrage from all regions of Slovakia," Muška said on February 6 for the private TV channel JOJ.

Čaplovič has been sharply critical of the system invented by the ministry. He told the Sme daily on February 9 that the new registration system surprised him.

"I felt as though I just fell out of a cherry tree," Čaplovič told Sme. "I know the Prime Minister was shocked as well. If we applied such a system to other EU fund programmes - where would it lead us?"

Asked whether he suspected that some communities could be favoured during the registration, Čaplovič answered: "With such a model in place there would always be suspicion."

Čaplovič also said that the current online system should be changed, as it is not convenient.

The European Union will investigate how applications are registered in Slovakia, Eva Kaluzynska, the spokesperson for the Commissioner of the EU for Regional Development told the private TV channel Markíza on February 7.

"So far, we do not know exactly what has happened, but we will ask our employees in Slovakia to analyse the situation for us," she said.

The opposition, too, criticised Minister Janušek's new system.

Iván Farkas (SMK), a member of the local parliament in the Nitra Region, told the Slovak Radio that the registration process was not transparent.

Farkas said that since the call for registration was on the website for only 30 minutes, it is highly probable that the 54 successfully registered applicants knew in advance when they would have to register.

"There is a suspicion that they could have known about this in advance," Farkas said.

According to Farkas, due to issues surrounding the euro-funds, there are lasting tensions within the ruling coalition, especially between Smer and SNS.

Minister Janušek said he was convinced the system was transparent and that the analysis of successfully registered applicants does not bear out the accusations of party cronyism. Thus, he refuses to change the system.

"We do not want to change this [system] in any way, as we live in the time of the internet," he told the Slovak Radio on February 8.

Ministry spokesperson Miroslav Bátovský has confirmed for The Slovak Spectator that the current system will not change, since it is both better and faster than the previous one.

"It will be a streamlined, rolling applications process, and the evaluation of submitted applications will not take long, either," Bátovský said.

He added that under the previous system, applicants had to wait up to a year for their projects to be evaluated.

"When compared with the past, this system is three times faster," Bátovský said.

He also said that in the case of the 54 registered applicants which evoked the wave of criticism, this was just a trial round.

"In the next round, the date and hour when the application system will open will be provided in advance," Bátovský told The Slovak Spectator.

The next round of registration should be launched by the middle of March.

According to the ministry's analysis, 20 municipalities led by a mayor with no party backing, 18 with a mayor who ran for the ruling coalition, and 13 with opposition-supported mayors registered on the web. Two municipalities with mixed leadership registered as well, according to the Sme daily.

"We did not know the time in advance, so we waited from the early morning by the computer for the whole thing to start on the web," Zuzana Švantnerová from the Poprad town hall, which succeeded in registering a project for elementary schools, told TV Markíza.

Ján Rudolf, chairman of the civic association Euro-funds for Slovakia, told TV Markíza the new system's requirement that applicants go in person to the ministry whenever they need to add something to their applications makes room for corruption.

"This is completely useless, since an applicant, perhaps a mayor from eastern Slovakia, might have to travel to the ministry just to talk to someone for five or ten minutes," Rudolf added.

Slovakia has not managed to draw all the allocated funds for any of the drawing periods.

In the previous period, from 2005 to the end of 2007, Slovakia returned Sk272.8 million. This amount was added to the Sk80 million which Slovakia did not draw in 2004, according to the Finance Ministry.

Rudolf also said that one of the problems is that the people responsible for the euro-funds have been replaced for political reasons far too often.

"The trouble is that at the beginning of the programme period, [of the current cabinet of Robert Fico], the system was badly set," Rudolf told the TA3 television channel. He added that the system is far too bureaucratic, and that there has not been much improvement in the management of EU funds.

"I see no improvement," he said. "The Slovak Republic will lose hundreds of millions of crowns."

Two ministries, the labour and education ministries have not been able to draw the funds, František Palko (SNS), State Secretary of the Finance Ministry, told TA3.

Political ethics watchdog Transparency International Slovensko (TIS) said it was rather hard to see good intentions behind the website registration process, which lasted for only a few minutes.

"It is really hard to see any rationality there - to see what was supposed to be so positive and good about it," Emília Beblavá told The Slovak Spectator.

She said that TIS has repeatedly noted that party affiliation far too often becomes a criterion when the central power distributes finances.

As for the reconstruction of schools financed through Euro-funds, she said that there was a huge need in Slovakia and schools were entitled to get the money, Beblavá stressed.

Beblavá said that mayors politically affiliated with the current ruling coalition may find that their municipalities are more successful with these projects than those whose mayors come from the opposition.

"We have checked several projects or subsidy schemes allotted by the central government to the local level, not just in connection with the euro-funds," Beblavá said. "We simply saw a pattern of preferring communities which are politically close to the current ruling coalition."

However, Beblavá also said that the previous system was not immune to corruption.

As long as there are many more applicants than recipients, the cronyism in the system of allocating subsidies will persist, Beblavá added.

She said the solution is to create a scheme which would clearly define the criteria for specific projects, with everyone who qualifies getting a subsidy.

Secondly, if this rule cannot be always applied, supply and demand should be balanced, she added, which means toughening the conditions for receiving aid.

"Thus, the huge imbalance between the demand and the supply will be abolished, and neither personal nor party cronyism will be necessary," Beblavá told The Slovak Spectator.

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