After establishing the professional army, immovable property of the army worth CZK 6 billion lies fallow. It is an unnecessary burden on the national budget
Press release to audit No 18/02 – 17 December 2018
The Supreme Audit Office focused on the management of the Ministry of Defence (MoD) and Armádní Servisní, contributory organization, with immovable property and related funds for securing tasks of the Army of the Czech Republic for the years 2015 to 2017. Auditors focused specifically on how the property had been managed, used, fixed, or sold, and in particular whether the volume of the property was in line with the needs of the current army.
The audit has shown that the volume of real estate managed by the MoD does not meet the needs of the army and is unnecessarily burdening the state budget. The Ministry does not use buildings worth CZK 6.5 billion, the administration of which amounted to CZK 32 million in 2017 alone. It is the property that the MoD often ceased to use before 2010 in the context of the earlier establishment of the professional army.
In view of the fact that the buildings are not used, a number of them are gradually falling into disrepair. The structural degradation of the buildings was estimated at CZK 13.4 billion.
If the Ministry of Defence had consistently implemented the procedures and tasks it had set itself in its “White Paper” — a single concept since 2002, which delt with the property of the MoD - it would have been able to raise money for the reconstruction of the buildings.
The White Paper directly supposes, among other things, that funds received from the sale of unused property were to help restore the army buildings. In total, over the years 2004 to 2015, the MoD received CZK 4.2 billion from these sales. However, the MoD used just less than CZK 800 million of these funds for restoring the army real estate.
According to this concept, the Ministry of Defence was also to make the use of its accommodation facilities more efficient, thereby obtaining additional funds for the recovery of its property. In 2014, the MoD designed to terminate the operations of 37 low-use or loss-making accommodation facilities and subsequently sold 31 of them. The Armádní Servisní would have saved over CZK 20 million a year. The army finally approved of the sale but only of seven such facilities.
Auditors also focused on the use of the army accommodation facilities and found out that the accommodation facilities managed by the Armádní Servisní were not occupied even by an average of 50 per cent between 2015 and 2017. At the same time, the MoD also operated such facilities that were not used at all — such as the accommodation facility in Slaný or Lázně Bohdaneč.
The Ministry of Defence and the Armádní Servisní register 32 thousand real estate assets amounting to CZK 62 billion. The Ministry also manages military sites with a total surface area of 400 square kilometres.
Supreme Audit Office