WITH DEFICIENCES OF VIEW
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The Court of Accounts of the Republic of Moldova (CoARM) examined today, February 27, the results of the follow-up audit regarding the implementation of the recommendations approved by the Court of Accounts’ Decision no. 36 from 16.07.2021 regarding the Compliance audit report on the implementation of the Housing Construction Project for the Socially Vulnerable Layers.
The purpose of the audit was to evaluate the way in which the submitted recommendations were approached and implemented, as well as the impact obtained following the implementation of the Court of Accounts Decision no. 36 from July 16, 2021.
The previous audit highlighted deficiencies in the organization, realization and monitoring of the implementation of the Housing Construction Project for socially vulnerable strata, the most relevant being:
- distribution of social housing to beneficiaries who do not meet the criteria established by law, in 57 cases out of the 139 checked;
- distribution of social housing to beneficiaries who did not meet the eligibility criteria regarding the income obtained (16 cases out of the 139 checked);
- lack of records in the accounting records by 5 LPAs of level II of the value of the social housing received in ownership, distorting the value of the managed public patrimony by 81 million lei, etc.
To remedy the attested situations, 29 recommendations were submitted to 9 entities through the CoARM’s Decision, of which 7 recommendations were implemented, partially implemented – 9 and not implemented at all– 13 recommendations.
The measures taken by the concerned entities were not sufficient to fully eliminate the identified deficiencies, therefore the previously identified problems remain, the non-resolution of which indicates a high degree of materialization, continuity and advancement of the problems.
Thus, the Ministry of Infrastructure and Regional Development did not take sufficient measures to correlate the normative framework, which conditions the further distribution of social housing to beneficiaries who do not meet the criteria established by the normative acts.
Nor did the Construction Project Implementation Unit (PIU) take measures to remove the deficiencies found by the previous audit in the chapter on the execution of construction works, being unrecovered expenses in the total amount of 142.3 thousand lei, paid for the execution of some works that were not actually ascertained by the audit team (for 3 objectives). More than that, it is revealed that as a result of the control carried out by the Agency for Technical Supervision (ATS) of the volumes and costs of the works carried out at the objectives in the districts of Rezina and Cimișlia, exaggerations of the volumes in the total amount of 5.6 million were found. lei and 1.4 million lei, respectively.
Until now, the Călăraşi District Council has not been able to re-examine the status of 8 apartments allocated to the teachers of the Vocational School in the city. Calarasi, which were reported as social housing, they are still occupied by people who are not eligible according to the regulatory criteria.
The District Councils: Călărași, Soroca and Nisporeni took measures to adjust the accounting records of the value of the heritage obtained as a result of the implementation of the Project in the amount of 66.7 million lei. And the District Councils: Sîngerei and Briceni did not take measures and did not register assets in the total amount of 14.3 million lei.
The Court of Accounts recommended Level II LPAs, which were not verified during the previous audit, to voluntarily comply with the recommendations in the audit report.
At the same time, a request from the Social Protection, Health and Family Committee of the Parliament of the Republic of Moldova was submitted to the Court of Accounts for the evaluation of the implementation of the Project in the other beneficiary districts that were not subjected to the previous audit.
Thus, during the follow-up audit, samples were collected to evaluate the implementation of the recommendations from the previous audit and for the other beneficiary districts. Deficiencies were found in the implementation of the Project at the objectives in the Rezina and Cimișlia districts, caused by the delay in the completion of the construction works by the contractors, although the concerned District Councils already bear expenses for the payment of loans and related interests. Thus, at the objective in the Rezina district, from 2017 to the present, construction works were executed in the total amount of 27.9 million lei, and in the Cimișlia district, from 2018 to the present - 14.9 million. lei.
According to the explanations of the responsible persons within the PIU, the non-completion of the construction works was generated by the deficiencies in the project documentation.
Pursuant to the contractual provisions, the contractors were penalized for violating the approved execution schedule for the period September - December 2022 with the amount of 191.9 thousand lei and 177.2 thousand lei, respectively.
Another finding is that the accounting services within 3 LPAs of level II did not ensure the proper registration in the accounting records of the social housing received in ownership in a total amount of 73.5 million lei, the financial reports of the entities subject to the audit being distorted.
The audit evidence collected shows that during the distribution of social housing, 6 LPAs of level II that were not targeted in the previous audit, did not comply in some cases with the provisions of the normative framework, in the end benefiting from social housing to ineligible persons, who have salary incomes above the limit legally established, as well as own real estate.
Thus, in 18 cases out of the 112 verified, the Committees within the District Councils: Cantemir, Cahul, Hîncești, Ialoveni and Leova assigned social housing to beneficiaries who were not eligible according to the criterion regarding the income obtained compared to the approved eligible income limit. An eloquent example is in the city of Ialoveni, where the applicant submitted an application for housing in 2021. The audit found that, in the period 2018-2020, he obtained salary income together with family members in the total amount of 916.7 thousand lei, or 25.5 thousand lei per month, which is 13.7 thousand lei/month more much more than the income limit for 2021 calculated according to the Oxford scale for 2 adults and 1 minor (11.8 thousand lei/month).
Contrary to the stated purpose of the Project for which it benefited from loans from external financiers, the Glodeni District Council changed the status of 8 social apartments, transforming them into service apartments.
Examining the distribution of housing in Hîncești r., the audit reveals that out of 56 apartments built, as of 01.02.2023, only 34 housing units were allocated, or 60.7 percent.
Although, according to the information presented by the Hîncești District Council, during 2017-2022, persons with severe disabilities, deinstitutionalized persons and families supporting children with severe disabilities were registered on its territory, however, the homes have not been distributed until now, the entity motivating this situation by the fact that the social houses are far from the district center. The audit mentions that the expenses executed on the homes that have not been allocated to date amounted to 16.1 million lei.
Checking the executed works on site, the audit team had access to only 3 out of 4 repaired apartments in the village of Sofia, because the entrance to the last apartment was blocked. According to the explanations of the responsible persons from the Hîncești District Council, this apartment is used by a natural person who expanded its construction and changed the entrance, arguing that he registered the ownership of this apartment in 2006.
Examining the data from the Real Estate Register, it was found that in the block in the village of Sofia, 5 homes with an area of 164.8 m2 were registered as property, including 4 by the Hîncești District Council with an area of 130.9 m2, and one home with the surface of 33.9 m2 by a natural person in 2006. Therefore, the apartment with an area of 31.7 m2, which according to the Real Estate Register is the property of the Hîncești District Council, is being misused, amounting to approximately 547 thousand lei.
During the follow-up audit, the accounting service of the Hîncești and Briceni District Councils adjusted the value of the social housing executed within the Project with the amount of 7.45 million lei and 364.3 thousand lei, respectively.
In the context of the above, the recommendations from the Compliance Audit Report on the implementation of the Housing Construction Project for the socially vulnerable layers, which have not been implemented, will be reiterated and reformulated by the external public audit.
