Grants for reconstructions of cultural sites awarded without concepts; projects often delayed while costs exceeded expectations

PRESS RELEASE on Audit No. 15/40 – August 22, 2016

The Supreme Audit Office (SAO) audited funds under two national programmes, which were provided by the Ministry of Culture for maintenance and reconstruction of cultural sites and state-owned castles. Auditors scrutinized four sub-programmes, which supported 559 projects worth CZK 5,200 million in total during the period 2008–2015. Auditors concluded that the Ministry did not follow its own defined priorities when selecting individual projects for funding, but rather followed the requirements of allowance organisations. The selection process was found non-transparent as the applied points system was only formal, which allowed subjective assessment of applications. Moreover, the Ministry often postponed the projects’ implementation terms without assessing their actual contributions.

With one audited programme, the Ministry of Culture failed to set clear rules for the selection process. The assessment list of applications was not consistent with awarded scores. In some cases, applicants were promised grants before the assessment process even started. Thus, auditors concluded that the assessment processes were non-transparent. The Ministry did not state in advance, which expenditures would be eligible and as a result had to make operational decisions on the reimbursing. No maximum reimbursement amounts were pre-set for the allowance organisations. The Ministry also failed to define any contribution rate with the potential expenditures.

Auditors selected and scrutinized 14 projects implemented by five individual beneficiaries, which were worth over CZK 820 million in total. Implementation terms were postponed with 11 out of the 14 audited projects, on average by tree years. Among the causes of the delays were too long procurement procedures, differences between the proclaimed and real conditions of the buildings, and necessary archaeological investigations or reconstruction works even before the projects began. Among the projects with the latest terms was one that aimed at reconstruction of facades of the National Theatre, which got postponed by seven years. With 10 out of the 14 audited projects, there were increases in costs, on average by 10 %. For example, the final costs of the reconstruction at the Holy Trinity Hospital in České Budějovice were 46 % higher than planned. Serious errors were found in the project that aimed at reconstruction and development of the administration building at the Wallachian Open Air Museum in Rožnov pod Radhoštěm, as there was a violation of the budgetary discipline in the amount of CZK 250 800, which were intended for preparation costs but were used to cover construction works instead.

The Ministry of Culture only developed a general strategy for the development and reconstruction projects that aimed at state-owned cultural facilities, but in the strategy, it was not possible to find out whether the programmes did target the Ministry’s said objectives. The Ministry established the programmes under demands from allowance organisations. Subsidies have been granted for 13 year under the programmes, but the Ministry has not assessed the programmes’ outcomes so far. The earlier Programme was about to be finished in 2007 and the Ministry was supposed to perform an assessment of the Programme in 2008. However, the Programme’s documentation was amended five times and the implementation terms got postponed to 2017. Funds allocated for the Programme gradually increased from CZK 2,600 million to more than CZK 8,800 million. With the other Programme, the implementation deadline was postponed by three years and the allocation increased from 1,900 million to 3,600 million so far.

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