The inability of the government to deal with the operational programmes is being exposed in every of its moves. All the schemes to whitewash the situation came to light, too. First, it became clear that the state will probably lose more than 1 billion lev of the money for regional development due to poorly prepared projects. Then it became clear that the vast majority of the funds will go to purchasing environment-friendly trams, trolleys, metro carriages and even fire vehicles because of the total mess in the water sector. Now it turns out that the business sector will say goodbye to hundreds of millions that could have been allocated by the European Union. The blame for this has traditionally been passed on companies, even though the decision making is a task of the bureaucrats.
In fact, to save from disaster the Competitiveness operational programme, which provides grants to companies, the Ministry of Economy, Energy and Tourism redirected more money to the Jeremy tool a several days ago. This is about 300 million lev, which would help the small and medium companies in the introduction of innovative products. After the maneuver, however, the latter would not be possible, even though interest in the scheme was high. But innovation is generally quick financing needs, since aging rapidly.
But why officials should make any efforts after there is a much easier way. In this case, the holding fund Jeremy will introduce through the 300 million a new facility for lending through Unicredit Bulbank, ProCredit Bank, Raiffeisenbank, UBB and EIBANK. So the EU money will not be given as a grant to companies, but will be held in the official statistics as used. What could be more convenient than that?
The main goal is to improve access to borrowed funds by SMEs. It is envisaged that the interest rate should be 0% on the funding part of the Jeremy and a standard market interest rates on the portion provided by the credit institutions. This is a way to achieve an effective reduction of the interest rate by one half for businesses. Along with significantly lower interest rates, loans will also have lower levels of pledges and service charges. Companies can use low-interest loans to finance their investment projects and their needs of working capital. The maximum loan term will be 10 years, the managing authority of the programme explained.
Since unspent funds can now be reported as utilized, the Government decided to boast publicly unreal achievements. Economy Minister Delian Dobrev proudly announced that since the merger of the intermediate unit and the Competitiveness Programme’s managing body at the end of April, a total of 420 million levs so far has been paid. Given that the aid proportion is 50%, this means that the companies are implementing projects for more than 750 million levs. Such funds are a stimulus to the economy, said the minister. Mr. Dobrev conveniently overlooked the fact that in the amount of 420 million lev the aforementioned 300 million is included and that has not yet come to businesses and may remain unused at all. According to official figures, by 20 October the programme has paid exactly 943,279,024 levs, which is 41.5 percent of the total envisaged sum. But by early 2012, the spending was 413,710,192 levs. The real problem is that the business actually received only about 230 million levs in grants from the European Funds. Why is it so? Well, very simply – the funds poured to Jeremy have been 682 584 670 lev ( while the actually granted credits are below 70 million levs in total). Economy Ministry itself has absorbed 8,835,090 levs, the Agency for Small and Medium-Sized Companies has taken another 14,503,567 levs, the Bulgarian Investment Agency – 3,131,346 levs and Metrology Institute – 2,543,692 levs. In other words, for bank loans and administration went more than 711 million levs. This is now being called aid intensity and stimulus to the economy.
