Government's Planless Investments in Public Enterprises

The Kosovo government has invested 26m euros in public enterprises during 2012-2016. These investments, the Government of Kosovo has done without supporting a strategy, but only on the basis of demands coming from public enterprises.

The ministry's “Finance of capital projects has been made mainly based on the demands of public enterprises. The lack of strategic document as the key element of an effective internal control system, diminish the accountability and transparency of taxpayers and interest parties related to government priorities”, the audience's report on capital investments that were made in public companies by the Kosovo government says.

The audience has also found shortcomings in terms of supervision of public enterprises and especially projects funded by the state budget.

The ministry has prepared the policy for subsidising the NP, but it has not drafted standard supervision and monitoring procedures of public enterprises. As a result, the ongoing delivery of projects in terms of spending, resource use, implementation of activities, achievement of results, and risk management of” has been unable, the report further shows.

The ministry interprets baseless results in analysis and does not have a unique system of reporting from public enterprises to the institution.

The ministry has not established a unified system of reporting public enterprises. This system would enable the ministry to have a comprehensive and standardised mirror for capital projects. Also, he has not done any assessment of projects financed in public enterprises so that the interpretation of the results is based on analysis”, the audience further explains.

Notes have also been given concerning arbitrary budget writings for several public enterprises.

With the case of budgetary reviews, the Government of Kosovo has not analysed and assessed the possible consequences on budget cuts for some of the public enterprises. The budget for several capital projects had been reduced, despite public companies having previously signed contracts with economic operators. As a result, the public enterprise had unpaid obligations for jobs that were realised”, the report shows.

One of the companies that has benefited subsidies from the Kosovo government is “InfraCos”, which according to the audience, has no financial opportunity to cover even operational expenses. The audience has chronologically explained how the amount of resources invested by the government has fallen in the company. The audience says the government cut the previous budget to this company by leaving it in debt.

Kosovo's “Government, as well as MZHE, have not analysed and assessed possible consequences on budget cuts for HINA NP InfraKosı, or at least inform the NP of these budget cuts in time so that it does not enter contracting obligations with economic operators. After signing the MPC NP Infra Kos has contracted economic operators with the aim of completing projects based on the divided budget. As a result of the NP budget cuts at the end of the year, it has resulted in unpaid obligations worth 37,542 euros”, the audience report says.

Public Enterprises

The audience's report says public companies as beneficiaries of funds from the Government of Kosovo have managed to manage capital investments at a satisfactory level towards achieving the goal for what the means have been given.

Four (4) from six (6) funded projects have been accomplished 100 percent, while two other projects have been accomplished between 40 and 70 percent.
The report says that implementation of projects as a whole has contributed to increased public infrastructure, and this has also contributed to improving services to citizens.

The audience has found out how some projects remain un finalised because some municipalities have not done their job.

The fact that two administrative objects financed by Kosovo's budget were finalised in early 2015 by the Regional Company of wastes Eco-region Sh.a. Prizren, but they haven't been set up yet. The failure to operate is due to the lack of water and water infrastructure and channeling, duty of the Rahovec and Suhareka municipality. This has made it impossible to deploy the working staff to these objects, which would affect the improvement of services for citizens in these municipalities”, the ZKA report said.
Despite compliance with procurement procedures and reporting project implementation, the KR “Eco Region” and the KR “Pastia” had no separate accounts financed by the ministry.

“Budget Management and Spending for capital projects funded by the Ministry at the KM-Eko Regionı and the KR Purgertia were not made in a separate account which was one of the 17 criteria under the” agreement, the audience announced.
The Public Company “Drini White” had not properly maintained and completed the files for capital investments. As a result, there was uncertainty in identifying two projects and evaluating them.

The Ministry of Economic Development and Public Enterprises have agreed with the findings and conclusions of the audience's report and have pledged to implement the recommendations.
The National Audition Office has audited the bodies, management and monitoring of capital investments. Public companies./Cashho. com/