WITH DEFICIENCES OF VIEW
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On July 20, the Court of Accounts of the Republic of Moldova examined during an online meeting the Compliance Audit Report of the use by the administrative-territorial units of the transfers from the state budget intended for road infrastructure.
The audit aimed to provide reasonable assurance on the assessment of the compliance of the use by the administrative-territorial units (ATU) of transfers from the state budget.
According to the Law on the road fund and the Law on public finances, were established new rules for planning and allocating road fund allocations for road infrastructure. Thus, the main destinations of the Road Fund means are the maintenance, repair and reconstruction of national and local public roads.
The amounts of special purpose transfers to the local budgets of level I for communal roads and street infrastructure are calculated in proportion to the number of population present in the ATU territory on January 1, presented by the National Bureau of Statistics (NBS), and based on the estimated volume in the amount of 50% of the revenues from the toll for the use of roads by the vehicles registered in the Republic of Moldova. The functionality of the resource management system for road infrastructure is not ensured according to a uniform framework of execution and reporting, which allows in some cases the use of resources contrary to regulatory requirements, and the management of public and patrimonial funds is defective.
Execution of total expenditures for road infrastructure amounted to 988.6 million lei or 33.0 million lei less than the allocated amount of 1.0 billion lei, of which: 211.5 million lei or 20.7% returned to public roads within ATU level II Gagauzia, Chisinau and Balti; 527.6 million lei or 51.6% - district budgets; 282.8 million lei or 27.7% - for the mayoralties of the district and village centers.
The total expenditures executed at consolidated level, registered by the local public authorities at the “Roads Management” group constituted 2.0 billion lei, out of which 1.3 billion lei or 65.8% represent current expenditures.
The selective monitoring of the process of managing financial and patrimonial resources, the deficiencies in the public procurement activities and the lack of constraint levers were the basic factors, which conditioned the non-compliances found, with harmful effects on the public interests.
Central public authorities (CPAs) and local public authorities (LPAs) did not have truthful information on their streets, local and district roads, their quality and condition. II level LPA reports the total length of roads of district interest of 3564.6 km, of which 48.2 percent or 1718.4 km are concrete, asphalt and cement roads. The Soroca and Cimișlia District Councils presented data to the NBS, decreasing by 13.4 km. According to the Ministry of Economy and Infrastructure, which served as a basis for calculating special purpose transfers, the length of district roads is 3592.9 km or 30.6 km longer than the data reported by the II Level LPA to the NBS, including 14 authorities with 42.0 km less and at 12 with 72.6 km more. No works are carried out to investigate the network of public roads, including specifying their length, with the correlation of these data with the formula for calculating transfers. District authorities do not have a documentary basis for these purposes, including technical passports and technical assessment reports, fixed assets records and other information, etc.
The road maintenance strategy is a starting point and an essential element of road network management, which allows for annual or longer-term planning. The audit reveals that any district council does not adopt such strategic planning.
Public authorities are directly responsible, in addition to the obligations assumed by the contractor, for the technologies applied, and for the quality and prices estimated for construction works.
The working group for public procurement within the Cahul District Council incorrectly determined the object of the procurement exposed to the auction and illegally indicated the purchase of services, instead of periodic maintenance and road repair works estimated at 22.0 million lei, which led in error the participants in the auction. According to the data of the information system, similar cases are found at four district councils: Briceni, Rezina, Cimișlia, Criuleni, the procurement contracts awarded being worth 22.8 million lei.
The audit certifies that the process of monitoring by the LPA authorities of the terms of the guarantee period for each contractual object is deficient, because the regulatory provisions are not complied with and the drafting of the minutes by the Final Reception Committees is formal, not properly the examined documents are not attached, and the post-guarantee upon receipt upon completion of the de facto works becomes final, lacking the mandatory conditions for monitoring by the LPA.
The audit found that no I and II Level LPAs audited by the Final Acceptance Committee were required to examine the investor's conclusion regarding the behavior of their constructions and installations in operation during the warranty period, including defects detected and remedied.
The district councils did not ensure the registration in the Real Estate Register of the rights over the lands related to the 3564.6 km roads. Thus, 9 audited district councils did not ensure the proper accounting of assets related to district roads, such as: 69 bridges (length over 10 m), bridges - 839, pavilions - 133, road signs - 2191 units and road plantations - 61054 of trees.
LPAs, as road administrators, do not have a detailed record of indicators or other special devices located in the roadway of the administration. Only in the years 2019-2020 of eight District Councils and a City Hall were made expenses of 812.8 thousand lei, without documentation on damage, theft and installation of signs on new sections, by concretely registering the road sectors where they were installed or the annexation of location schemes, etc.
In the enterprise contracts concluded by 6 district councils: Călărași, Fălești, Cahul, Hîncești, Căușeni, Soroca and 2 town halls of Hîncești municipality and Călărași, as well as in the minutes of reception of the executed works, it was found that the expenses related to the works in the total amount of 5.4 million lei are not justified by the concrete registration of the road sectors.
The Court of Accounts concludes that the assessment of the process of managing the financial resources related to road infrastructure by the first and second level public authorities reveals non-compliances in the planning of road maintenance and repair programs, inconsistencies with the provisions of the strategies in the field, and non-conformities with the estimation and planning of the procurement objectives, at the stages of awarding, executing and monitoring the enterprise contracts, with the reporting of the results of the construction behavior.
These aspects of the authorities' work in the field of the use of public funds for road infrastructure need to be improved in order to increase the transparency and efficiency of the use of public funds.
