91997E3598

WRITTEN QUESTION E-3598/97 by Ernesto Caccavale (UPE) to the Commission (13 November 1997)

Subject: Misuse of cooperation funds

In 1993 approximately LIT 6 billion was allocated by DG VIII to CESTAS, an Italian NGO based in Bologna, for urgent health work in Angola.

There is still no evidence of CESTAS working in Angola, although it would seem that in 1993 and 1994 a large amount of expenses for extravagant 'fact-finding' missions in that tormented country were authorized by the directors of the NGO for its members.

Furthermore, it seems that the NGO had a number of problems with the Cape Verdean authorities (in Africa) in 1994 and 1995, since it allegedly failed for months to administer a project to combat AIDS, which was also commissioned and financed by the Commission's DG VIII.

Can the Commission:

1. shed light on these events without delay;

2. consider the possibility of suspending any funding which proves to have been wrongfully granted;

3. organize careful on-the-spot checks to ascertain whether EU funding is being used properly and efficiently;

4. assess whether there have been instances of 'favouritism' on the part of DG VIII and/or casual management by the officials responsible for on-the-spot checks?

Answer given by Mr Pinheiro on behalf of the Commission (8 January 1998)

The Commission rejects any allegation that it shows favouritism in granting funds to NGOs for implementing development cooperation.

It systematically evaluates the merits of projects and programmes presented by European NGOs, notably as regards their compatibility with the development strategies of the countries concerned, before any financing decision is taken. It closely monitors project execution both at headquarters and in the delegations, with continued funding depending on strict implementation of the project even in sometimes difficult conditions.

On-the-spot project evaluation and supervision missions are carried out professionally and independently of the local authorities and NGOs concerned. Financing is suspended immediately if any irregularity is discovered. The last tranche is granted only on the basis of an implementation report and verification that expenditure has been made as planned in keeping with the rules on the utilisation of the funds.

The final tranche of the Cestas health project in Angola has not yet been paid. The Commission established that the NGO was having difficulties implementing the project in this strife-riven country. The NGO was asked to reorient the project and the measure has been extended.

As regards the Cestas project in Cape Verde, the health ministry complained about the delay in the supply of equipment. The dispute was settled in 1993 following an evaluation mission. The Cestas project came to an end in 1994 once all the services forming part of the contract had been performed. It is now being continued directly with the health education unit of the relevant ministry.