Increase in prices was the main reason for delays in EU funds acquisition in 2011
On Tuesday, December 20, the Ministry of Finance (MoF) reported to the Cabinet of Ministers on the acquisition of European Union (EU) funds and other foreign financial assistance instruments by end-November 2011.
“Although we can say that the liabilities for 2011 regarding EU funds acquisition set in the Memorandum of Understanding with international lenders are at large extent implemented, ministries mainly have not managed to achieve more ambitious financial goals of national projects. As a reason for delays in the acquisition this year is mentioned increase in prices that the government decided not to approve. It is very important that ministries take into account experience of previous years and their own planning errors and plan really the budget financing for 2012. But Latvia can be proud that it is still in the top of the list of EU member states showing the best EU funds acquisition results,” says State Secretary of the MoF on EU Funds Issues Aleksandrs Antonovs.
For example, in late November Latvia was the fourth among twelve new member states in terms of European Commission payments to member states showing results (36% of EC payments of total EU funds contribution) close to Slovenia and Cyprus (37%), which were ranked the third.
Initial EU funds project payment plans in the state budget for 2011 for ministries amounted to 903 million lats, however, the MoF, having evaluated acquisition experience of previous years, envisaged 648.6 million lats in the budget. In the government meeting representatives of ministries provided information about the amount of budget financing that ministries will not be able to utilize by the end of the year, the remaining amount may reach 100 million lats. The biggest non-executions of the state budget plan are in the Ministry of Transport, Ministry of Education and Science, Ministry of Economics and Ministry of Environmental Protection and Regional Development.
In order to solve the problem of increasing prices the government assigned the MoF to provide immediately a standard mechanism for indexation of procurement contracts that would justify the increase in prices.
In the state budget for 2012 the amount of approved financing for the implementation of EU fund projects is 581 million lats,
Informative report is available on the homepage of the Cabinet of Ministers.
Information prepared by:
Agnese Belkevica
Deputy Head of the Communication Division
Phone 67083938
Agnese.Belkevica@fm.gov.lv
