Construction of the motorway D47: incomplete documentations, landscape development insufficiencies, and funding system inaccuracies
Press Release – May 14, 2010
From June 2009 to January 2010, auditors from the Supreme Audit Office (SAO) performed an audit of the construction of motorway D47 (leading from Lipník nad Bečvou towards the state boundaries with Poland). Auditors aimed at economic, efficient, and effective utilization of the allotted funds within the period 2005–2009 and assessed future risks related to the motorway’s finishing works. Auditors made use of the results from the previous audit No. 04/25 – Development of transport infrastructure in cohesion regions Central Moravia and Moravia-Silesia (published the SAO Bulletin, No. 2/2005). Among the audited bodies were Ministry of Transport, State Fund for Transport Infrastructure, and Road and Motorway Directorate of the Czech Republic.
“The construction of the motorway D47 has been complicated by various issues including landscape development problems as well as recent underfunding events. These result in enlargements of the realization terms, additional costs, and other risks. The investor, Road and Motorway Directorate, struggles to keep the schedule that was approved by the government“, said president of the SAO František Dohnal.
The Directorate has turned to irregular procedures, e. g. announcing tenders for construction works and initiating the construction without the necessary building approvals. Such evading and violations of the Building Act bring risks of administrative sanctions. To avoid further complications of building control procedures, the Directorate covered investments in the local infrastructure, which were only loosely connected to the construction of motorway D47.
“The investment’s effectiveness was badly influenced by enlargements of the realization terms and by additional costs. The drop may be even worse in case the contractors and general government agencies apply sanctions“, said Dohnal.
The Ministry failed to produce sustainable evidence why some approach roads had been included into the construction of motorway D47. The additional constructions only dealt with the infrastructure of the Statutory City of Ostrava, but Ostrava City or the Moravian-Silesian Region did not share the costs. The poor landscape development only resulted in delaying and ceasing of the construction works. According to the Ministry, the Government had appointed the Managing and Coordinating Committee on the construction of motorway D47 that was the only responsible authority for making such decisions.
The above described state was probably caused by the conflict between decisions made by state authorities and the program funding principles, which are stipulated in the budgetary regulations. The co-financing possibility of EU funds and European Investment Bank adhere to analogical principles.
The Ministry is legally required to produce a balanced assortment of the investment funds that are intended for the transport infrastructure development. Unfortunately, such functions are negatively influenced by various commissions, which have been formed to support local needs at the expense of strategic goals of the State Fund for Transport Infrastructure.
The undervalued area development led among others to a significant delay of the Ostrava region’s connection to national as well as interstate networks, which badly affected the region’s economy; such a connection had already been expected in 1997–1998 planning schemes to be accomplished in 2006. Under such circumstances, the Czech assessment system for road constructions found only little if any point in financing of the D47 construction. Consequently, the national budget runs into debts because of the approved debenture scheme.
In contradiction with Act on the debenture programme for defrayment of the motorway D47 construction costs, over CZK 3.3 milliard were utilized for other constructions. Consequently, the State Fund for Transport Infrastructure needs over CZK 2.9 milliard for finishing the construction of the motorway D47.
The auditing operation was included into 2009 Audit Plan of the SAO under No. 09/16. Petr Skála, Member of the SAO Board, controlled the operation and prepared the audit conclusion as well.
Bc. Radka Burketová
Press Speaker
Supreme Audit Office