Cause and Effect in European Politics and Law

Bulgaria Must Start Making Decisions

Ralitsa Kovacheva, March 8, 2012

The biggest challenge Bulgaria is facing is to work simultaneously for better absorption of EU funds within the current programming period and to plan its strategic priorities for the next period. This message was conveyed by European experts during a media workshop on EU structural funds for Bulgaria, organised by the Directorate General for Regional Policy and the European Commission Representation in Bulgaria.

At European level debates on the future of the regional policy have already begun. In terms of resources, there is a clear trend of increasing regional funding at the expense of reducing the money for the agricultural policy. As to the philosophy and objectives of regional policy, the strongest voice at the moment belongs to the so called net payers, the richest countries that pay the largest contributions but receive the least funding, because presumably the cohesion funds are intended for poorer countries and regions. Their position is that the rich countries should also benefit from these funds, especially given the poor absorption in the new member states.

In order to participate fully and from the very beginning in this debate, Bulgaria should have strategic objectives, which it should formulate in a specific and clear plan and, most importantly, be able to justify it before the European Commission. Pouring money into fragmented individual projects is not sufficiently effective, so experts recommend focusing more resources on certain problems, identified as key ones by the country itself. The funds obtained under the various instruments of regional policy may, for example, be used to implement important structural reforms, for which money from national budgets is never enough.

In this sense euinside asked the Bulgarian minister of EU funds management, Tomislav Donchev, whether there was a discussion at institutional level about what would the Bulgarian priorities for the period 2014-2020 be. Without specifying the level of discussions, Minister Donchev gave a surprisingly concrete answer: transport infrastructure, integration of ethnic minorities and addressing high age dependency ratio (age dependency ratio shows the number of people in "dependent" age under 15 and over 65 per 100 people of the population in "independent" age - 15 to 64).

The strategic objectives of Bulgaria in terms of EU funds are related to searching for the "engine" of our economy henceforth, the sectors with the highest added value, Minister Donchev explained. In this sense, the creation of the necessary transport infrastructure is vital. Problems related to the integration of minorities and ageing also have a significant economic impact, because in practise this means greater social burden on fewer working people. With regard to minorities, the question is not simply to improve their living conditions, which is not insignificant, minister Donchev said, but there is also another aspect - these people do not create a product.

It is undoubtedly positive that the Bulgarian priorities reflect the targets of the European 10-year strategy Europe 2020. However, it is disturbing that, as minister Donchev joked, no matter how long experts discuss and whatever they propose, it could be smashed into pieces by the politicians. In order to avoid this, the only solution is the issue to be taken out of the ministerial offices and to be widely discussed, especially through media with the entire society. Why, for instance, not to add education to the strategic priorities of Bulgaria - not only because it is one of the objectives of the European strategy, but also because when you build roads and investors come, they would expect to find skilled labour.

While preparing for the next programming period, a great challenge to our country will be to produce projects for the so called ‘integrated urban development’ - integrated solutions for urban areas aimed at promoting economic development. Such projects are likely to receive direct funding and even to be set as a requirement for the next programming period. The reason is that currently the poorer and smaller municipalities are more active in submitting projects and the aim is to attract large cities, which are themselves an incentive for the development of the other regions.

Sofia is a good example for this, as it has only one project – for the construction of the subway - and has submitted another - for a waste plant (only in April 2010), but there are still discussions with the European Commission how to improve the documents and plans. Officers with DG Regional Development are in talks with Sofia Municipality about future projects for public transport, but they are at a too early stage. The paradox is that the Bulgarian capital city does not show any activity in absorbing EU funds, although a certain percentage of the regional development funds is earmarked for Sofia.

The other condition Bulgaria to be well prepared at the negotiating table with the Commission for the next programming period, is to improve the current level of absorption of funds. Both minister Tomislav Donchev and the European experts believe that the current problems with absorption are due to the Bulgarian legislation.

"Most of the problems are associated with the public procurement law, the mere organisation of tenders, environmental impact assessment procedures, expropriation procedures. It takes two thirds of the time to realise a project in terms of administrative effort," Minister Donchev explained. Not less than 70-80 percent of European money pass though the public procurement law, so it is necessary to have quick assignment, unlike now, when it takes 6-7 months, the minister said. Therefore the adoption of a new public procurement law is a priority (this, albeit for other reasons, was a recommendation in the latest Commission`s CVM report and Prime Minister Borissov promised this to be done within 3 months, but then the term became one year).

The most serious problems Bulgaria is facing are related to the Cohesion Fund and Operational Programme "Transport", Minister Donchev admitted. One year after the law was amended and the road agency was relocated to the regional ministry, it still does not work. European experts explained that they had never received a response from the government why this was the case. Attracting foreign experts from international financial institutions is part of the solution, though it is not enough, Minister Donchev admitted.

The European experts are sceptical whether this support will be crucial, because last year over 100 experts from Brussels worked in Bulgaria, but this did not lead to significant results. The reason? There is a problem with making decisions - not to delay them in time or transfer elsewhere, but to take responsibility. Because not taking a decision is worse than making the wrong decision. It simply does not lead anywhere. And this is a luxury Bulgaria cannot afford, given the obvious need of serious reforms in health care, pension and social areas.

No strategic vision for the future development of the country could be developed, if solving the problems does not start now. We cannot expect results in 10 or 20 years, if today our eyes can reach only as far as the next election.