The Czech Republic will not utilize all EU funds allocated for railway network modernisation
PRESS RELEASE on Audit No. 13/14 – February 17, 2014
The Supreme Audit Office (SAO) performed an audit of modernisation of the railway network outside the Trans-European Transport Network (TEN-T), i. e. outside the main corridor lines. The audited period was from 2009 to present. Auditors focused on electrification of railways.
In the programming period 2007–2013, the funds allocated for modernisation of the railway network from the Transport Operational Programme amounted to EUR 393.5 million. By the end of 2012, beneficiaries were only paid one-third of the allocated funds and only EUR 40.6 million, i. e. only 10.3 % of the allocation, were certified. There is a real threat that the allocated resources will not be utilised in full. The Ministry could merely explain this trend in general – pointing to delays in preparation of large projects.
When the Ministry of Transport decided on the preparation and execution of the projects, the correctness and objectiveness of the assumptions applied in the projects’ economical assessments were not examined. In certain cases, the Ministry itself contested the veracity of documents based on which a decision was to be made. The financial parameters and timing of projects during the course of decisions changed substantially without a proper examination of causes and impacts of such changes.
For example in 2007, the Ministry of Transport agreed with the electrification of the line from Šatov to Znojmo under the condition that the Railway Infrastructure Administration and the State Fund for Transport Infrastructure will harmonize the schedule with electrification works at the lines Brno–Jihlava and Okříšky–Znojmo. In July 2008, the Ministry approved funding of the works from EU funds in spite the electrification of the line from Brno to Jihlava was reduced to the section Brno– Zastávka u Brna and preparations of electrification of the line Okříšky–Znojmo had not started yet.
In certain cases, changes in the subject and scope of the works were made only on the basis of the project engineers’ instructions without concluding the addenda to the work contracts. For example, during the electrification of the line from Zábřeh to Šumperk the Railway Infrastructure Administration paid CZK 15.7 million for works without concluding rightful agreements but only based on instructions of the works’ manager. The Railway Infrastructure Administration also awarded additional work in negotiated procedure without publication at the time when it was already carried out.
Supreme Audit Office