ROP NUTS II Southwest: Regional health-care facilities not following rules for EU funds drawing

PRESS RELEASE on Audit No. 14/16 – January 12, 2015

The Supreme Audit Office (SAO) scrutinized funds from Regional Operational Programme NUTS II Southwest (“ROP Southwest”) that had been provided for development and reconstructions projects implemented at regional medical health-care facilities. Auditors scrutinized the council of the NUTS II Southwest region and seven individual projects, which had been co-financed under the ROP Southwest. Errors were found in the area of funding, assessment and evaluation. The audited projects were implemented in České Budějovice Hospital, Tábor Hospital, PRIVAMED – Plzeň City Hospital, and Plzeň Regional Emergency Medical Services.

The council of the NUTS II Southwest region poorly set indicators for project evaluation and optimum budgeting. The indicators did not correspond with actual prices and lacked telling abilities. For example, in case of purchases of intensive care unit fittings in Tábor Hospital the optimum price would be CZK 260 million according to the indicators set by the Council. But the actual price only amounted to some CZK 21 million. Such indicators did not enable the Council to sufficiently evaluate whether the funds provided for regional health-care facilities had been utilized efficiently.

The unrealistic indicators allowed audited health-care facilities to purchase medical devices for various prices. For example, PRIVAMED – Plzeň City Hospital procured a bedside monitor of vital parameters for less than CZK 175,000, while Tábor Hospital spent over CZK 541,000 for a similar apparatus. In case of a purchase of an anaesthetist machine with integrated systems for monitoring of vital parameters, PRIVAMED – Plzeň City Hospital spent CZK 757,000, while Tábor Hospital spent around CZK 400,000 more for the same appliance. With some projects aimed at constructions of health-care facilities, individual beneficiaries paid up to 53 % more for one cubic meter in construction than stipulated in the decree implementing Property Valuation Act.

According to the Program, beneficiaries were allowed to utilize the allotments when purchasing equipment worth more than CZK 40,000. Some audited health-care centres used the allotted funds to purchase furniture, computers and other equipment worth CZK 8.8 million in total but still did not meet the financial limit. In the accounting records, various items were grouped (these joint invoices were sometimes worth several millions) so that the beneficiaries could demand reimbursements from the allotted funds. The council of the NUTS II Southwest region reimbursed the expenses in spite according to the Operational Program’s conditions these expenses were ineligible. The SAO decided to inform the financial authorities about these cases of budgetary discipline violations.

Communication Department
Supreme Audit Office

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