Cautious Optimism: Clear Criticism Despite Progress Ratings

Despite the assessment of progress, the European Commission’s report brings numerous criticisms, demands for concrete results, and new recommendations focused on implementing adopted laws – the real work is yet to come!

The European Commission’s report provides an average progress score of 3.21 across chapters, while the readiness score is 3.20, showing slight improvement compared to previous years. Although these are the highest scores recorded so far, the difference is measured in decimals. We remind that the European Commission uses two levels of evaluation – “progress score” and “state/readiness overview.” The first level pertains to the overall state in areas covered by individual chapters, while the second level focuses on assessing the progress made over twelve months.

While progress has been noted, it is crucial for substantial reforms that the EU applies its announced enhanced monitoring system, especially in light of promises that progress in key chapters (23 and 24) will be accompanied by a comprehensive assessment of public administration and democratic institution reforms.

Most of last year’s recommendations in the cluster related to fundamental chapters focused on the adoption of laws and strategic documents. In this report, these recommendations have been replaced by an insistence on implementing the adopted documents. Most recommendations regarding concrete results have been repeated, while in specific areas like the judiciary, public enterprises, and public procurement, they have been further detailed. All recommendations regarding public administration reform have been reiterated, with the adoption of the Law on Free Access to Information, which we have long advocated for, being just one of them.

Following the report on fulfilling interim benchmarks in these chapters, the process of developing final benchmarks through the preparation and adoption of revised action plans for meeting the final benchmarks is even more crucial, and it must be inclusive.

Unfortunately, the government has shown a worrying trend of excluding the public from important decision-making, partly under the pretext of the need for accelerated EU accession. Momentum in EU accession cannot justify this trend, as the integration process inherently values the enhancement of citizen participation in public policy making.

See the comparison of the average score and progress per chapter compared to 2023:

Government to provide software for all inspections

Institute Alternative has called on the Government to ensure the necessary conditions for the Unified Inspection Information System (UIIS) to be utilised by all inspection bodies.

After we highlighted that the inspection software was not in use, the Government of Montenegro issued an Information on October 10, 2024, regarding the Unified Inspection Information System, emphasising the need to reactivate the system for inspections that previously used the software, which was deactivated following the dissolution of the Administration for Inspection Affairs.

Through its conclusions, the Government obligated the Ministry of Public Administration to enable the reactivation of JIIS by November 1.

We note that certain inspections, even before the dissolution of the Administration for Inspection Affairs, operated within ministries (such as urban and construction, administrative, and budgetary inspections) and that these inspections are not connected to UIIS, nor do they have access to advanced IT infrastructure that would facilitate inspection supervision. Given that these inspections lack such support in their work, we believe that working conditions should be equalised for all inspections, particularly by providing this type of tool to improve inspection efficiency.

We have called on the Government to take the opportunity to plan and enable the system to cover those inspections that have operated within ministries as part of the upcoming intervention on the existing information system.

You can read the letter we sent to the Government here.

About Public Administration Employment for CIN-CG

Official data is quite conservative, and its reliability is questionable, but it shows a steady trend of increasing public sector employment. It is important to emphasise that there is no unified record of the number of employees in state and local government owned enterprises.

The downside of all this is flawed hiring procedures and a complete lack of vision and meritocracy from the Government. I deliberately use the word meritocracy because many of today’s politicians were inclined to promise it while they were in opposition. The latest example of backsliding is the reintroduction of the rule where, instead of school boards, the Minister of Education decides on the appointment of school principals. Not even two years ago, these provisions were abolished in the same manner as they were introduced—by the Parliament, without public debate, explanation, or a systemic approach. The new parliamentary majority, led by the “Europe Now” Movement, justified the removal of authority from school boards by citing poor results.

Without a predictable procedure and clear criteria for testing all candidates, there can be no depoliticisation and professionalisation. Reducing and adjusting the number of employees to meet the real needs of the public sector—so-called “optimisation”—has disappeared from the Government’s comprehensive reform plans, and even from the recently presented Draft Fiscal Strategy, despite a decision by the previous Democratic Party of Socialists government to significantly reduce public administration staffing.

For example, the Public Administration Optimisation Plan for 2018-2020 called for a 3 percent reduction in employees by the end of 2018, or 1,179 fewer employees. Instead of being optimised, the administration only expanded, and one could say there is quite a disorder in the public sector—or better, sectors—since the rules are so fragmented, and data management and accountability are lacking even where clear rules and punitive measures for oversight and record-keeping on salaries and employment exist.

It’s difficult to precisely determine the actual number of employees in public administration, and records are not always kept on individuals engaged through freelance or temporary contracts. The establishment of these contracts must be conducted more transparently, with clear plans and identified needs.

Milena Muk

Public policy researcher

You can read the text on the Center for Investigative Journalism of Montenegro (CIN-CG)

Parliamentary Diplomacy: Regional cooperation through enhanced parliamentary dialogue – Decarbonisation

At the Berlin Process Summit held on 10 November, 2020 in Sofia, the leaders of the Western Balkans Six (WB6), Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia, endorsed the Common Regional Market (CRM) 2021-2024 Action Plan and the Green Agenda 2021-2030 Action Plan.

Based on the RCC’s implementation reports and desk research conducted in the period from November 2023 to September 2024, the Institute Alternative has a glance at Montenegro’s current level of implementation of the action plans.

You can find the current level of implementation of the Green Agenda Action Plan and the achievements in the field of decarbonisation in our monitoring report.

 

IA Proposals for SAI’s Annual Audit Plan for 2025

The State Audit Institution (SAI) has continued its positive practice for the second consecutive year, inviting civil society, the academic community, and professional associations to submit proposals for the annual audit plan for the coming year.

We would like to remind that last year, the SAI accepted one of the three proposals we submitted, and conducted an audit on the compliance of simplified procurement procedures across multiple public sector entities for the year 2023. This audit confirmed previous findings from the IA on a smaller sample, pointing to abuses of the direct procurement mechanism.

For the 2025 Annual Audit Plan, we have prepared three new proposals:

  • Performance Audit – System for Planning and Preparing Infrastructure Projects for EU Funding (WBIF)

 Considering that in 2023, the government submitted investment projects in energy, environmental protection, and transport sectors to the European Commission, which were deemed premature or unsuitable for funding by the Western Balkans Investment Framework, we have suggested this as a starting point for this audit. In our analysis of the Unified List of Priority Infrastructure Projects, we highlighted numerous irregularities in how projects were presented, evaluated for maturity, and valued. A comparative regional review shows that other countries in the region have more developed project preparation mechanisms, where both the domestic capital budget system and the projects submitted to the EU are centralised and linked with the national budget planning system. Additionally, there have been changes to the body overseeing and planning these types of projects, negatively affecting its work and the adoption of a new list of priority projects.

Therefore, we believe it is essential for the SAI to monitor the functioning of this system, particularly because of the announced Growth Plan, an EU financial support instrument for regional countries, providing Montenegro access to a €3 billion fund of loans and grants over the next four years through this type of infrastructure project financing.

 

  • Performance Audit – Efficiency of Inspection Oversight in Terms of Resolving Appeals in Second-Instance Procedures

The goal of this audit would be to determine whether the current actions of institutions have been effective in addressing appeals in second-instance inspection procedures. According to the Inspection Oversight Act, an appeal against an inspector’s decision can be filed within 8 days of receiving the written decision. The appeal in the second-instance procedure is decided by the ministry responsible for the relevant administrative area. Although the law states that an appeal does not suspend the execution of the decision, it also allows for the execution to be postponed until a decision on the appeal is made in certain situations. Institute Alternative’s experience shows that the response to an appeal can take several months; in one case, we waited more than two months, while in another, there was no response even after three months.

Given the recent changes to the legislative framework on inspection oversight, whereby inspections are now part of ministries, we consider it important for the SAI to provide an objective insight into the functioning of this system to identify legal and other obstacles to efficient proceedings in second-instance inspection oversight.

 

  • Corporate Governance in State-Owned and Public Enterprises

We proposed that the SAI conduct a thematic audit on a sample of several state-owned and municipally-owned enterprises at the central and local levels, focusing on the core elements of good corporate governance to draw conclusions on shortcomings and challenges.

Public enterprise reform was highlighted as one of the priority areas in the European Commission’s 2023 report. Structural reforms in this area are also planned in the Economic Reform Programme for the 2023-2025 period. The work of companies that are majority-owned by the state requires further regulation—either through a special act or an amendment to the current Companies Act—to introduce mechanisms allowing the state to manage companies more effectively, making them more transparent and accountable for the responsibilities assigned to them and the assets they manage. The fact that government conclusions on salary reductions and similar matters are being ignored speaks to a systemic issue in the communication between the owner and the enterprises.

We believe this type of audit is the best way for the SAI to enter multiple enterprises of this type simultaneously and provide the public with a comprehensive view of the quality of corporate governance. At the same time, as the Ministry of Finance is currently contemplating reform directions for public enterprises, it would be valuable to have objective recommendations from the SAI in that process.

 IA Team

The Government Forgot About the State Property Inspection

The State Property Inspection has not conducted a single inspection in the past year, and in the meantime, the inspection body has been left without inspectors, as they have been reassigned to other positions or their mandates have expired.

The State Property Inspection has not been operational since October 2023. Following amendments to a government regulation in October 2023, this inspection body was placed under the jurisdiction of the Ministry of Spatial Planning, Urbanism, and State Property. Until then, since 2010, it operated under the Ministry of Finance in accordance with the Law on State Property. Changes in the organisation of the government did not take into account the Law on State Property, which stipulates that the Ministry of Finance is responsible for its enforcement. As a result, the inspection body remains caught between the law and the regulation, between two ministries, and inspectors are left without the authority to carry out their duties.

From October 2023 to June 2024, the government did not take measures to resolve the inconsistency between the provisions of the law and the regulation. Only in June did the government propose amendments to the Law on State Property to change the responsible ministry, aligning the law with the regulation. However, this proposal was not adopted by Parliament, as the majority of MPs opposed the government’s and ruling coalition’s amendment proposal.

As of October 2024, the State Property Inspection has no inspectors; two inspectors were reassigned, and the third’s mandate expired.

In January 2023, there were five state property inspectors within the Directorate for State Property Inspection. Inspections in 2023 were carried out by four inspectors, as one inspector continued working in the Municipality of Bar in February 2023. Since January 2024, the State Property Inspection has had no chief inspector, and inspections have been carried out by three inspectors.

The Directorate for State Property Inspection oversees the enforcement of the Law on State Property, the Regulation on the Sale and Lease of State Property, and the Regulation on the Record and Inventory of Movable and Immovable Property in State Ownership. The State Property Inspection monitors the management of state assets and other property belonging to Montenegro or local governments in ministries, other administrative bodies, government agencies, local government bodies, the Capital, the Royal Capital, and public institutions. The State Property Inspection also oversees the procedures, agreements, and conditions under which state-owned immovable property is leased or used.

In 2023, the State Property Inspection conducted 36 inspections. None of these inspections recorded any cases of state property being usurped. Apart from one inspection, in which inspectors visited four outpatient clinics at the Health Centre in Kotor, no inspections recorded the state of state-owned assets.

A Television Vijesti segment and commentary by our Dragana Jaćimović on this topic.

We monitor the work of inspections within the project “ Inspect to Protect: Turning Inspectorates Into Anti-Corruption Allies”, supported by the Embassy of the United States in Montenegro, the State Department’s Bureau for International Narcotics and Law Enforcement Affairs (INL). The content is the sole responsibility of Institute Alternative and does not necessarily reflect the views of the United States Government.