Bulgaria grabbed the last option to prevent the loss of nearly 1.7 billion levs worth of EU funds. After a long and painful administrative saga, last week the Ministry of Agriculture and Food announced the final choice of a certification authority – that would be the one-man limited liability company Deloitte Bulgaria. The company is owned by the Cyprus-registered company Deloitte Central Europe Holdings Limited. It is managed by Assen Dimov, Sylvia Peneva, Englishman Gavin Hill and the citizen of the Netherlands Peter Wessel. It will perform the certification audit of the Agriculture Fund, the paying agency of the Republic of Bulgaria.
For unknown reasons, the Ministry of Agriculture for over a year and a half was unable to hold this competition and put under tremendous risk the compensation with European money what was already paid from the budget. There was danger that the approved billions of EU funds will not be sent here. Now the auditing company should work as fast as possible to send its report by 31 January to Brussels – this is the way to that the money may be saved. Besides, the company should reaffirm the findings of spot checks carried out by the paying agency during the financial year 2014. The auditor should confirm the legality of the sums paid to farmers under the Programme for Rural Development amounting to 1.7 billion levs from the state budget, so that the Ministry of Agriculture may recover them.
Deloitte Bulgaria will perform their services against 539,000 levs without VAT. The Deputy Minister of Agriculture and Food Vasil Grudev boasted that this agreement has been achieved at a price twice lower than projected – 1.2 million levs. The offer of the second participant in the competition procedure, Ernst & Young Audit LTD, was for 1.08 million levs.
The procedure for selecting the Certifying Authority of the State Fund Agriculture was held by direct negotiations. The initiative came in October, when the then official minister and current Deputy Minister Vasil Grudev noted the critical delay. And now he did not hide that the delay in choosing a Certifying Authority was reflected very badly on the reputation of our country. It turned out that we are the only country in the European Union without acting Certifying Authority for the funds paid from the agricultural funds so far. The country had to ask for special visits Brussels with requests to extend the period within which to present its report.
Obviously this is not the only concern of the new leaders of the agriculture ministry. Days ago it became clear that the department was officially notified of the imposition of a financial correction of 60 million euros set by the European Commission on direct payments due to detected problems. They on their turn are connected with the identification of agricultural areas, the Programme for Rural Development (2007-2013-a) and municipal measures.
Minister of Agriculture and Food Desislava Taneva announced that the biggest problems that were found in these audit missions are associated with the programme and the measures are municipal ones as well as technical assistance. Bulgaria has requested deferral of the payment for the next three years, as according to European norms it has the right to it. The answer to this request is expected to arrive after December 18. In practice, this means that in the next funding under direct payments and under the programme for rural areas these amounts will be deducted. Of course, given that commissioners allow this to happen in the next three years.
Mrs. Taneva tried to calm down beneficiaries that they will not lose in this case, but in practice the government will contribute more funding to these projects, as problems in implementation of the program and its measures come from the state.
Meanwhile the commission runs several procedures, under some of which it has requested a variety of sanctions. For example, the procedure for municipal measures and the payment of advances on these projects has not yet been completed, but Brussels has already requested a fine of 120 million euros, said Minister Taneva.
Now local departments have rolled up their sleeves to defend the position that the country does not owe these amounts, but whether the reasons that will be used to justify this will be accepted is not yet clear. The truth is that at this stage the position of the European Commission for financial corrections says the fines should come to 248 million euros.
