Statement: No Follow-up to SAI’s recommendations

Questions from “Dan”:

Can you comment the final report of the SAI on the Government accounts for 2011 year and the fact that the Ministers were shared 775 thousand euros, hired 697 civil servants and diverted funds from one budget item to another and between the consumer unit?

How do you comment the fact that the Government failed to meet 13 of 18 recommendations made by the SAI last year?

Marko Sošić, Public Policy Researcher in the Institute Alternative replies:

Institute Alternative has been warning for a long time about the unacceptable attitude of the Ministry of Finance, which has repeatedly refused to approve the significantly major budget for the SAI, endangering its financial independence. Now we see the logical consequence of such position, and that is the fact that the Ministry of Finance does not care much for the work or the SAI and is not paying attention to the recommendations and rectifying of irregularities.

This is a practice that has worried the people in the SAI, but especially in the Parliament: We should not forget that by ignoring the SAI recommendations, the Government actually expresses contempt for the Parliament of Montenegro, which has adopted SAI recommendations last year as its conclusions.

The European Commission, in the last Progress Report noted that progress has been made in accepting the recommendations of the audited entities. The question is, on what basis is deserved this positive score if the SAI data show a very different trend and set a variety of cases in which the recommendations are not followed.

SAI itself has, in the final audit report of the Budget, clearly pointed out the problem of the lack of attention paid to the verification of implementation of recommendations of the audited entities.
It seems that, after seven years of work, it is about time for the SAI recommendations to go beyond ordering to respect laws in force. Here we mean that persistent “offenders” must be punished. For this to occur, however, it is necessary to regulate the levels of accountability in public finances, especially when it comes to the misdemeanor and criminal liability.

The problem that prevents the determination of responsibility for the irregularities and wrongdoing is that systemic Budget Law contains no penalties for budget users and executives in the event of improper conduct in planning, execution and reporting of the budget process. Montenegro is the only country in the region where sanctions in the area of public financial management is not adequately regulated by the law nor applied in practice. This issue we have highlighted in 2010 in our study on the impact of state audit.

If we want the SAI’s work to be meaningful, it is not enough to produce based, comprehensive reports and good references. All the other actors, especially the Ministry of Finance and the Government must evaluate its work and work to implement the recommendations of the SAI. From the last SAI report we can see that this is not the case and that other actors do not care much for the work of the SAI when it is necessary to implement the SAI’s recommendations. To make things worse, a legal framework for ensuring that those responsible for the irregularities and law breaches will be sanctioned has not even been established.

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