Bulgarian Government to Request Extension of ISPA Deadlines, EC – unhappy with Compliance Assessments in the Operational Programmes

The government will request a one-year extension of the deadline for using the ISPA pre-accession programme funding, the Deputy Minister of Regional Development Liliana Pavlova said, cited by Dnevnik Daily.

The Programme expires in the end of 2010 but so far only 38 percent of the funds have been used. The data from the Ministry of Finance shows that the total budget of ISPA is 1.6 billion euro, of which 478 million were paid by the end of January. The negotiations for the deadline extension will be led with the new make-up of the European Commission which will be clear in October, Pavlova explained.

The cases for which there are 323 million euro of suspended PHARE funding will be reviewed, Deputy Minister Nikolova announced. According to her, this was requested by the European Commission. This time a new approach will be taken - a horizontal review of the financial memoranda instead of a project-by-project review.

European Commission has again declined to accept the positive compliance assessments of five operational programmes, sent by the Bulgarian audit unit in May, Pavlova confirmed, cited by Mediapool. Commission approval is necessary in order for the interim payments for the programmes to be restored. Those payments amount to 80 percent of the total of 7 billion euro.

EC declined the assessments of the programmes last year because of the weak administrative capacity of the audit unit and the dysfunctional information system for management of the European funding. The unit was transformed into an agency and the information system has slowly started operating. A year later, the European Commission is not satisfied with the results and is not confident that the managing authorities have created the necessary conditions for effective and transparent work with the EU funds.

Pavlova explained that there are two options: one is for the European Commission to decline the assessments and to send them back to Bulgaria for another audit report and the other is to suspend the procedure for approval of the assessments which has to be completed by November and to request an action plan for correcting the lapses.

The assessments of Operational Programme Environment and OP Regional Development still have not been sent to Brussels. Pavlova explained that the evaluation of OPRD will be completed by the end of August and the lapses, detected in the management of the other programmes, will be corrected so that they would not be turned down.