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Monday 19.03.2018 | Name days: Jāzeps

Misuse of EU financing costs millions to municipalities

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Some municipalities have problems with proper use of EU funding year after year. In total, municipalities have lost 8.19 million LVL.

EU funding is more often misused in projects realized by Jelgava District Council (18 cases), followed by Kuldiga District Council (16 cases), Balvi District Council (10 cases) and a number of other municipalities, according to De facto programme of LTV.

For example, the pedestrian walkway and bicycle path in Jelgava District’s Jaunsvirlauka parish were constructed thanks to EU funding. It is, however, strictly stated what EU money can be used for. So, for example, the municipality also decided to patch holes on the adjacent road. 16 524.41 LVL were spent. This example is not an exception. It is more likely a systematic problem with the use of EU financing at Jelgava District Council. There were also cases of construction projects ending up more expensive than initially planned.

A number of violations were noted in repair projects at Kuldiga District. A construction company bearing debts was chosen to re-purpose a synagogue into a library. It failed to carry out its duties. The largest amount of money to be covered from the municipal budget for low quality projects was paid by Kuldiga’s municipality – 1 484 348 LVL. Nevertheless – this amount did not grow last year. This leads to the belief that municipalities have learned something.

Tulsa District Council can be called a spoiled brat in this regard – 698 322 LVL spent on virtually “nothing”. Jekabpils also seems to be too light headed when it comes to foreign money (574 161 LVL), followed by Gulbene (528 383 LVL), Balvi (263 400 LVL) and Ikskile (260 836 LVL). Director of the EU fund monitoring department of Finance Ministry Diana Rancane mentions Talsi, Balvi and Madona as examples where “municipalities are slower or less active when it comes to initiatives to improve the situation”.

In total, municipalities have spent and then covered from their own budgets 8.19 million LVL. Those were mostly breaches of different contracts, mostly related to additional work and term extension without proper procurement procedures.

Attraction of EU funding is active the most in large cities and districts. One of the main reasons – larger budget opportunities. Municipalities require co-funding in order to be able to afford projects. However, there are still situations when EU money is requested for the sole reason of funding being available.


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