SECO supporting ALSAI in auditing Concessions and PPPs

11.03.2020

On March 9, 2020, at the Supreme State Audit premisesit was held the signing ceremony of the Cooperation Agreement between the Swiss State Secretariat for Economic Affairs (SECO) and ALSAI on the project “Strengthening the external audit related to the supervision of Concessionsand Public-Private Partnerships”.

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The project was designed by ALSAI in 2016 and was announced as a winner one by IDI, the INTOSAI Development Initiative, the worldwide organization of supreme audit institutions, which provided the support of the Swiss State Secretariat for Economic Affairs.

The Swiss Confederation Almighty Ambassador, Mr. Adrian Maître, after expressing the pleasure of this new chapter of cooperation between the ALSAI and the Swiss Economic Cooperation and Development Secretariat regarding the increase of professional capacities in auditing, also underlined the need of Albaniafor a public administration reform. This need also includes supervision mechanisms to achieve the effectiveness of the use of public funds.

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Maître underlined that effective institutions are a prerequisite for a stable economy, sustainable growth and the spread of prosperity. Being effective in the case of supreme audit institutions means being independent and being independent requires acting and being an objective arbiter by delivering objective results from auditing the appropriateness of using public funds and identifying cases of corruption and abuse. ALSAI's role is of particular importance in the contect of the current reforms Albania is doin in the field of justice, modernization of public administration and, more importantly, in the fight against crime and corruption.
“As a Swiss partner, we are here to support ALSAI with technical expertise as part of the extensive support Switzerland has provided with public finance management assistance including: debt management, tax administration, public accounting, financial statistics and local finances, as we consider that effective oversight of public finances completes and refines this important cycle of public administration in Albania ” – said Maître.

He further underlined that the project launched today will deliver new experiences and will improve the knowledge and skills of the ALSAI auditors to oversee the field of public-private partnership concessions and contracts by bringing and filling in an appropriate framework to ensure that these types of contracts provide added value and minimize risks in terms of public funding. of audit information.This whole process cannot be implemented without ensuring that auditors have the appropriate technical skills to use audit information technology tools.

At the end of his speech, Ambassador Maître expressed his enthusiasm for a successful implementation of the project, for tangible results and valuable information for the public and other stakeholders regarding public-private partnership, which will be audited through this project.

 

Mr. Bujar Leskaj, Chairman of ALSAI said that “Today's signing of the Cooperation Agreement is very important for us. It will help achieve our key objective of our development strategy 2018-2022 to further modernize our audit capacity. The project will provide a valuable contribution to ensurethat in the future our auditorswill be at the level of values of performance and impact on the life of the Albanian citizens, and at the same level of values, performance and impact of organisations of the supreme audit institutions (SAIs) of the Member States of the European Union and of the Swiss SAI, the Swiss Federal Audit Office ”.

The main objective of the project is to increase ALSAI's contribution to strengthening government accountability and transparency in the use of public funds through more professional and comprehensive audits of concessionsand public-private partnerships.

 

Further Mr. Leskaj stated that since April 2018 ALSAI has requested the establishment of a permanent and professional Opposition Unit against concessions and PPPs, which will function with the Assembly and be financially independent from the Executive. This Unit should have sufficient financial capacity to commission experts of the respective field for study and opposition of concession or PPP under consideration, on behalf and for the account of the relevant Assembly and Parliamentary Committee.

"In the situation when most tenders are carried out and concessions and PPPs are being implemented we have emphasized that such contract implementations bring (as the IMF and the World Bank have identified) increased exposure of our economy to risks of  the wrong selection of a public-private partnership, without an in-depth study of the cost / benefit ratio; risks to the long-term nature of these projects and the complexity of their contractual terms; lacking or incomplete legal framework, transparency and poor public participation in the process, as well as project failure, with high and long-term costs on the State Budget”, underlined the Chairman of ALSAI.
ALSAI found that the lack of reporting in the budgeting process and in the consolidated financial statements of the State, of concession and PPPsexpenditures, enables the conditions for compromising the completeness, accuracy and transparency of information on these projects.

 

It will be very important the SECO support in implementing this joint project, deepening our risk analysis and prioritizing our future audits of PPP contracts and concessions. I hope that the experience of the Swiss Federal Audit Office, a leading INTOSAI institution in technological innovation in auditing, can bring added value to this area of cooperation.The project will enable us to provide quality audits and addedvalue recommendations in the future management of these contracts, while also improving the legal framework for the procces of public tenders and the implementation of concessionary contracts. I express my conviction that this two-year project will help significantly and with maximum effectiveness in the more professional audit of public funds in the field of concessions and PPPs in Albania” - concluded Mr.Leskaj.

 

This event was attended also by the Almighty Ambassador of the Republic of Poland to Albania, Mr. Karol Bachura who praised the current cooperation between the State Supreme Audit and the National Audit Office of Poland, with the implementation of the twinning project for capacity building and establishing an institutional framework as close as possible to the European models of supreme audit institutions.This new project will raise auditing capacities to a more qualitative level, especially on public-private partnership contracts to strengthen public oversight in order to avoid the investigation body handling these cases (4 P: prosecutor-public - private-partnership).