In the Ministry of Environment and Water (MEW) there is a lack of financial discipline, inaccurate accounting and auditing is bad. No national strategy and policy for water sector development has so far been adopted, and what is also lacking is strategic and operational objectives for the concession activity. Procedure rules for the implementation of concessions have not been devised.
These are just some of the findings in the report of the Supreme Auditing Office on the spending of revenues from mineral water concessions and the ski zone concession above Bansko in the period 2009-2010.
The report also shows that the inspectorate of the ministry has not been instructed to check nor has it inspected the activities around these concessions. The risks when planning income and expenses have also not been identified, assessed or monitored. All this leads to chaos in the management of concessions that would otherwise bring significant revenue to the state budget.
The situation in the ministry starts from the fact that employees work without any rules and requirements for documenting their operations and activities. The work of experts in their participation in various stages of the concession process is not reported, which makes it impossible to track their actions. The auditors also found that there is no audibility between the departments Budget, Finance and Accounting, Water Management and Nature Protection National Service, which leads to inconsistencies and incompatibility of databases for the concession of mineral springs.
The communication between the ministry and municipalities has been interrupted, so that in some cases the due concession fee fails to reach municipalities. The supervision activities of the Ministry in this respect are is based on information provided by the companies themselves.
The active involvement of local administration in the process of administering the proceeds from the concession activity and cross-checking of information between the three parties – the concessionaire, the ministry and the municipality will reduce the risk of non-payment of amounts and will increase the collectability, said the auditors.
All these problems will inevitably have their financial expression. The reasoning in planning revenues from concession activities were not well justified and bound with sufficiently reliable financial and economic indicators. The planning of costs is not carried out according to set priorities based on strategic and operational objectives, which creates a risk for the efficient, economical and efficient spending of budgetary resources and leads to frequent changes in the approved operating expenses and the directions of their spending, the auditors wrote in their report.
For 2010, for example, the officials in the ministry estimated revenues amounting to 1.995 million lev, the same as those in 2007 without making any adjustments, although the change in the Water Act of 2009 significantly raised the minimum concession fee. In other words, Environment Ministry’s planning is not based on realistic data.
Whether because of this or due to any other cause during this period, the number of concessions and revenue from them has remained almost unchanged. At the same time,
costs increase significantly.
The BANKER
