Subsidies to sports: the Ministry of Education provided CZK 800 million under non-transparent conditions
PRESS RELEASE on Audit No. 14/04 – February 2, 2015
The Supreme Audit Office (SAO) aimed at the Ministry of Education and scrutinized three non-investment programmes that aimed at the support of sports from 2011 to 2013. The Ministry should have used the funds to support sporting activities of children, young people and the disabled, to fund operation costs of sports centres, and to fund sporting projects that were organized by non-profitmaking non-governmental organizations (NGOs). The SAO revealed that the Ministry had made fundamental errors with the subsidies. Auditors scrutinized 122 selected applications, which had been submitted by 19 various applicants and their allotments amounted to CZK 1,900 million in total.
During the period 2011–2013, subsidies to sports by the Ministry exceeded CZK 3,000 million with the audited programmes. The funds were mostly allotted to beneficiaries on the basis of incomplete, incorrect, lately submitted, and even non-existing applications. For example, the Ministry provided over CZK 1,200 million without any evidence documenting the exact period, in which the applications were submitted and reviewed. Other subsidies in the amount of CZK 1,000 million were provided to applicants who had not met the criteria – for example, it was not possible to find the information whether the applicants owned or rented any sports facilities. By exercising this approach, the Ministry created unequal conditions for individual applicants as well as non-transparent environment during the projects’ selection processes.
Since 2012, no contributions for the support of sports have been gained from profits of the Czech betting company SAZKA. When approving the State budget for the year 2012, the Chamber of Deputies decreed that the Ministry of Education would get additional funds in the amount of CZK 800 million for the support of sports. However, the said decree was made after the due date for submitting the applications for the year 2012. The Ministry did not re-schedule the application process and divided the funds according to its own assessment. Auditors revealed that out of 19 audited beneficiaries, 12 were provided more subsidies than had been originally asking for: The total amount requested in applications was CZK 215 million and the total amount of subsidies was CZK 547 million. The SAO concluded that such a decision making process is non-transparent.
Auditors also revealed that 11 beneficiaries failed to utilize the subsidies in ways previously determined by Programme objectives. For example, the Ministry allotted CZK 4.5 million to the citizens’ association European Medicine Association, which did not engage in sporting activities at all. The SAO concluded that there was a certain risk that the subsidies had been misused. The SAO also revealed that most sub-contractors were related with the Association either personally or with property. Other beneficiaries made errors as well. For example, a Czech automobile association Autoklub ČR utilised all provided subsidies in the amount of CZK 400,000 for maintenance and operation of motor camp site instead of supporting sports. The SAO revealed that budgetary regulations had been violated by the beneficiaries in case of CZK 15 million and respective financial authorities were informed.
Several sport associations transferred the provided subsidies to NGOs that organized sporting activities. The funds previously determined to support sports were also partially used to cover operational costs of the sport associations. For example, Czech Sports Union used CZK 26 million out of subsidies in the amount of CZK 42 million to pay the employees’ wages and Association of Czech Sport Federations used CZK 13 million out of the granted CZK 45 million for wages.
The SAO concluded that the Ministry of Education failed to fulfil its duties as the national guarantor in the sports’ supporting area. No actually measurable goals were set with the audited programmes. The Ministry only distributed state budget funds and did not assess the final effects. Furthermore, the Ministry did not keep records of all subsidies to sports, which were also provided from other ministries.
Communication Department
Supreme Audit Office