Agriculture and Rural Development Public Procurement issues in EAFRD implementation By Wolfgang...
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Transcript of Agriculture and Rural Development Public Procurement issues in EAFRD implementation By Wolfgang...
![Page 1: Agriculture and Rural Development Public Procurement issues in EAFRD implementation By Wolfgang KAHLENBORN European Commission DG Agriculture and Rural.](https://reader036.fdocuments.net/reader036/viewer/2022062619/55152595550346a80c8b6462/html5/thumbnails/1.jpg)
Agriculture and Rural Development
Public Procurement issues in EAFRD implementation
By
Wolfgang KAHLENBORN
European Commission DG Agriculture and Rural DevelopmentJ.4 – Audit of rural development expenditure and IPARD
December 2012
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Background
The Common Agricultural Policy
• Pillar 1 – EAGF (budget: 44 billion EUR in 2012)
• Pillar 2 – EAFRD (13 billion EUR)
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EAFRD – Rural Development (1)
• Axis 1 – Improving the competitiveness of the agricultural and forestry sector
• Axis 2 - Improving the environment and the countryside
• Axis 3 – The quality of life in rural areas and diversification of the rural economy
• Axis 4 – Leader
• Axis 5 – Technical assistance
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The European Agricultural Fund for Rural Development (EAFRD)
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EAFRD – Rural Development (2)
• Most projects are relatively small (not falling under the EU directives on public procurement)
• High number of beneficiaries
• Most beneficiaries are from the private sector
• Exceptional: private beneficiaries have to follow public procurement rules(according to national law)
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EAFRD – Rural Development (3)
Main measures with public beneficiaries:
• Measure 125 – Infrastructure related to the development and adaptation of agriculture and forestry
• Measure 321 – Basic services for the economy and the rural population
• Measure 322 – Village renewal and development
• Measure 323 – Conservation and upgrading of the rural heritage
• Axis 5 – Technical assistance
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Legislation
EAFRD legal provisions and public procurement:
• A project financed by the EAFRD has to comply with
EU law;
The Rural development program;
National law (incl. provisions on public procurement).
• The Paying Agency shall carry out an exhaustive check of the public procurement procedure(Article 24(2)(c) of Regulation 65/2011)
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Commission Audit Findings
• The Paying Agency does not feel responsible for the detailed verification of the public procurement procedure(“no complaints means all is fine”)
• The Paying Agency checks the procedure but examines only the winning bid.
• Weaknesses in the design of the award criteria.
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Commission auditors noted during their missions in the EU27 the following weaknesses:
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Case study (1)
• A bridge over a small river (measure 321; village renewal)
• The beneficiary: a village in a new Member State
• High aid intensity (100%)
• The beneficiary (village) is the contracting authority
• Tendered on the basis “the economically best offer”
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The investment project visited by the Commission auditors:
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Case study (2)
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Outcome of the tender:
Price Quality Warranty Duration Total
EUR 30% 30% 10% 30% 100%
Offer 1 320.000 27 6 8 30 70
Offer 2 500.000 17 21 2 13 53
Offer 3 324.000 18 14 6 16 54
Offer 4 290.000 30 15 3 18 66
Offer 5 550.000 16 29
10 20 74
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Case study (3)
Commission findings:
• The weight of the price was low andissues of interest of the village had a quite high importance
• The winning bid offered an (excessive) warranty period of 100 years.
A long warranty period means to have less costs of reparation in the future.
Maintenance costs as well as replacement investments are not eligible for an EAFRD funding.
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Case study (4)
Conclusions:
• The award criteria shall adequately take into consideration the interests of the contracting authority as well as those of the EU.
• The contracting authority as well as the Member State shall ensure that the award criteria and their weight lead to the “best offer”.
• The award criteria shall not lead to ineligible expenditure (as an excessive warranty period).
• The Managing authority should give help and/or fix in advance specific conditions for the procurement. This also facilitates the checks later on.
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Thank you for your attention!
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