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news 13 Oct 16

Kosovo Auditor Highlights Procurement Failures

New report by Kosovo's Auditor General criticises government's management of public spending and its failure to address the auditor's own previous recommendations.

Arben Qirezi
BIRN
Pristina
According to the report by auditor general, nearly 11,000 public contracts worth 402 million euros were signed last year. Photo: Pixabay.

A new report by Besnik Osmani, Kosovo's Auditor General, has found numerous weaknesses in the public procurement process, including planning and contract management.

According to the report for 2015, presented to parliament on Wednesday, nearly 11,000 public contracts worth 402 million euros were signed in 2015.

But it said that "implementation of the procurement legal framework is not yet at a satisfactory level,” and added that “the design of contracts does not offer value for money,” suggesting favouritization of certain companies.

The report also said electronic procurement equipment “is not yet operational” due to the “lack of managerial, human and technical capacity in the government agencies.”

Osmani also stated that “the level of current implementation of recommendations of auditing is not satisfactory.

“Lack of implementation means that weak control and financial losses are repeated, year-by-year,” he said.

The report reveals a low level of action on recommendations made the Auditor General by central and local government and by agencies and public enterprises. Of 1,033 recommendations, only 33 per cent were fully implemented, it said.

Moreover, the level of implementation of high-priority recommendations was only 24 per cent, whereas 52 per cent of medium-priority recommendations were implemented.

The Auditor General also noted an increase in wage spending of 40 million euros, partly due to the increased number of employees at central government level.

Employment at central level has long been a concern since the ruling parties in Kosovo tend to employ their officials and allies in public positions.

During the 2014 election campaign, the ruling Democratic Party of Kosovo, PDK, and the Democratic League of Kosovo, LDK, promised to create 200,000 and 150,000 new jobs respectively.

In the event, job creation has mainly focused in the public sector with the creation of new jobs for their own party officials.

The Auditor General report also notes weak planning, with plans lacking any costs and thus becoming vague.

Gaps in capacity for project planning and drafting were a result of the failure of institutions to contract appropriate professionals, which has “reduced the quality of services and the value for money”, he said.

The Auditor General was created by the UN agency in Kosovo, UNMIK, during the period of international administration of Kosovo. The office was managed by international civil servants until 2012.

Besnik Osmani, who was Secretary of the Ministry of Local Government from 2006 to 2016, is the first Kosovo-appointed director of the office.

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