Efficiency of the public-private partnership project in Ústí nad Labem unguaranteed
Press Release – December 2, 2008
Auditors from the Supreme Audit Office (SAO) performed an audit that focused on the PPP project of the Hall of Justice construction in Ústí nad Labem, which was prepared by the Ministry of Justice and the regional court of Ústí nad Labem. The budgetary commitments were estimated to CZK 410 million every year through the 23-year period of providing agreed services, which also included the building investments in the amount of CZK 1.7 milliard. Since 2003, the budgetary requirements for the project’s preparation phase have risen to CZK 48.9 million.
“The planning stage of the project started 5 years ago and has not been finished yet. The ministry did not ensure the processes in due form, which may affect the construction’s efficiency as well as the future operation of the Hall of Justice“, said František Dohnal, president of the SAO.
The ministry initiated the construction’s scheming without securing the financial resources or sizing up the project priorities. In 2005, the PPP project was launched in spite of the fact that basic economic values were underestimated. The engineering characteristic of could not guarantee the construction’s purposefulness or efficient operation of the future premises. As late as in 2006, necessary measures were taken to down-size the excessive areas while sparing three floors from the building.
The auditors found out that the ministry’s activities lacked the necessary transparency when adjusting the prices in connection with shifting the performance subject of the contract. Invoices for incomplete counselling were paid, and in August 2007, the ministry suspended the counselling activities without settling up the contract or concluding an agreement regarding the further movements.
The auditing operation was included into the 2008 Audit Plan of the SAO under No. 08/16. Jiří Adámek, Member of the SAO Board, controlled the operation and drew up the audit report as well.
Radka Burketová
Press Speaker
Supreme Audit Office