National Investment Fund Transparency (RO0057)

Improving transparency in allocations and acquisitions from national investment funds
2018-2020
Lead implementing agency/actor Ministry of Regional Development and Public Administration (MDRAP) Other actors involved State actors CSOs, private sector, multilaterals, working groups Expert Forum (EFOR) What is the public problem that the commitment will address? At present, there is limited data on how the funds are allocated, on public procurements and implementation of projects made through the National Program for Local Development (PNDL). In this context, the real impact and effectiveness of the program are difficult to quantify. Commitment description What is the commitment? The commitment is to increase transparency on the allocation and public procurement of the National Program for Local Development, as well as to increase the number of indicators and databases published in open format. How will the commitment contribute to solve the public problem? - Identify a larger number of databases related to these funds; - Generate public debate on the transparency, efficiency and evaluation of the program; - Publish the data on the data.gov.ro portal and on the MRDPA website. Why is this commitment relevant to OGP values? Increase the transparency of public funds allocated and invested through the PNDL Milestone activity with a verifiable deliverable Responsible agency / partner Start Date: End Date: Identification of data sets that can be put together based on legal regulations and the information produced in the procedures for the awarding, contracting, MDRAP / EFOR 2018 2018 24 implementation and evaluation of investments Organize a public debate on data sets and related procedures, including necessary legislative changes MDRAP / EFOR 2018 2019 Define procedures and publish data sets MDRAP 2019 July 2019 Updating the data sets MDRAP 2019 2020 Additional information Correlation with other government programs/strategies National Anti-Corruption Strategy - Specific objective 1.2 Increase the transparency of public resource management processes

10. Improving transparency in allocations and acquisitions from national investment funds

Commitment Text: "The commitment is to increase transparency on the allocation and public procurement of the National Program for Local Development, as well as to increase the number of indicators and databases published in open format."

Milestones:

10. • Identification of data sets that can be put together based on legal regulations and the information produced in the procedures for the awarding, contracting, implementation and evaluation of investments
    • Organize a public debate on data sets and related procedures, including necessary legislative changes
    • Define procedures and publish data sets
    • Updating the data sets

Start Date: 2018 ...............................................

End Date: 2020

Editorial Note: The commitment text is abridged. The full text can be found in the OGP 2016-2018 national action plan.

Context and Objectives

The National Program for Local Development (PNDL) 2017-2020 is the main financing source for local infrastructure in Romania, and has dedicated 30 billion RON (6.3 billion euros) to fund 9,500 local projects. [95] There are limited data on how the funds are allocated or projects implemented, and investigative journalists have found that several large projects implemented under PNDL were severely overpriced and of low quality, [96] sparking a criminal investigation into their potential use as a source for large kickbacks for high ranking members of the clergy and of the ruling political party. [97] Expert Forum has also published several reports [98] that suggest national investment funds falling under the PNDL are politically spent. An interviewed Ministry of Regional Development and Public Administration (MDRAP) representative argued instead that when a large fraction of local public administrations belongs to a certain party, that party will receive a proportionally large part of the investment funds. Simply looking at the amounts of funds spent per political party gives a false impression of political clientelism. [99] Increasing the transparency of the allocations of national investment funds and of corresponding public procurement contracts is therefore crucial to assess, beyond doubt, the effectiveness of this 6.3 billion euro program.

This commitment aims to identify and open more databases related to the national investment funds than what MDRAP currently publishes, and organize a public consultation or debate on the transparency, efficiency, and evaluation of the PNDL. These goals are relevant to the OGP values of access to information and civic participation. This commitment’s activities are specific enough to be verified, however the specific datasets that will be made available are not given.

The potential impact of this commitment largely depends on the datasets it will make available and the level of civil society input involved during the consultation. According to a representative from civil society, the potential impact of the consultation is difficult to assess, as it is a complex technical discussion that does not usually attract many civil society organizations. [100]

In terms of datasets, before the commitment, MDRAP published and updated the following:

• the broad procedures for the allocation of funds, [101] as mandated by HG 624/2016;
• the list of investments per local public administration that have been allocated funds—e.g., name of local public administration, title of investment, total funds allocated; [102]
• the list of contact persons (with contact details) responsible for the allocation of national funds allocations at county level; [103]
• summary statistics of the PNDL investments;
• a list of aggregate monthly transfers made, in accordance with ordinance (OUG) 28/2013, each month to the local public administrations. [104]

As part of this commitment, MDRAP will first analyze which datasets can be legally opened, in accordance to its own mandate. According to the MDRAP representative, a formal discussion between Expert Forum and MDRAP is necessary to distill which of the new datasets are relevant to civil society. [105] MDRAP does not publish the following information, which the Expert Forum representative suggested would be of interest: [106]

• The selection methodology for projects put forward by the local public administration. MDRAP does not publish the markers and the weights thereof that are used to select among competing projects.
• The list of local public administrations that applied for funding under PNDL but were not granted it. Transparency would help civil society monitor the allocation of funds to prevent political clientelism. MDRAP only publishes the list of local public administration that have been allocated funds.
• The official justification note that local public administrations put forward in order to receive the funds. Transparency would reveal how well the local public administration reflects the needs of the local community in requesting funding. According to the MDRAP representative, this can be retrieved together with other explanatory documents by sending a freedom of information (FOIA) request to the local public administration, [107] but according to the Expert Forum representative, the waiting times and the response rates make the FOIA requests to the local administration endeavor too difficult. [108]
• A list of public procurements that local administrations have made, based on the national investment funds (as mentioned in the annexes of OUG 28/2012). Transparency would reveal the quality of the competition for the execution of public works as well as the real absorption rate for the PNDL funds. According to the MDRAP representative, MDRAP does not oversee public procurements that local public administration organizes, and cannot publish data related to these procurements. [109] According to the Expert Forum representative, this data can be collected through FOIA requests, but at great costs of time and effort. [110]

Because of the lack of details on the specific datasets to be published, this commitment could have a moderate potential impact, if implemented as written. However, should the MDRAP make significant progress on the above list or the following recommendations, this commitment could significantly improve access to information on the implementation of PNDL.

Next steps

The IRM researcher recommends carrying this commitment forward to future action plans, considering the size and scope of these investment funds, their importance for the sustainable development of local communities, and numerous controversies that have been brought to light in relation to their allocation. The following recommendations can help guide the implementation of this commitment in the current, as well as in future, action plans:

• MDRAP could publish the reasons why certain datasets can or cannot be opened. This data review exercise will reveal the opportunities and the impediments and will help focus the public consultation sessions on how to practically open the data.
• MDRAP could utilize the public consultations to: (1) understand what information citizens consider relevant and would like to have open, and (2) understand why this information cannot be obtained from other sources or at which costs it could be obtained from different sources. MDRAP could then publish the feedback it receives.
• MDRAP could publish as many of the items in the list recommended by the Expert Forum as are in its remit to release, especially the selection methodology for projects and the list of local public administrations that applied but were not granted funding.
• MDRAP could also publish the official justification notes that local public administrations put forward in order to receive funding, for both those that were granted as well as for those that were not granted funding.

[95] MDRAP (19 July 2017) "Programul National de Dezvoltare Locala - PNDL, etapa a II-a", available [in Romanian] at https://bit.ly/2u9ksF2.

[96] Nedea, A. & Muntean, D. (2019) "Dumnezeul Achizitiilor", Recorder, available at https://bit.ly/2DSyChj.

[97] Nedea, A. (2019) "Efectul investigației Recorder: DNA s-a autosesizat și a deschis dosarul „Dumnezeul achizițiilor", Recorder, available at https://bit.ly/2SLe8Qq.

[98] Ionita, S., Stefan, L., Nutu, O. & Parvu, S. (2016) "Prioritati politice in Romania, prioritati politice in Moldova", Expert Forum annual report, available [in Romanian] at https://bit.ly/2JnTfEW; "Banii și achizițiile: unde au ajuns contractele din PNDL în județul Constanța?", Expert Forum, 9 December 2019, available [in Romanian] at https://bit.ly/2KZWshn.

[99] Interview with Andreea Grigore, Ministry of Regional Development and Public Administration (MDRAP), 19 April 2019.

[100] Interview with Septimiu Parvu, Expert Forum, 23 April 2019.

[101] MDRAP (19 July 2017), "Programul National de Dezvoltare Locala - PNDL etapa a II-a", slides 9-12, available [in Romanian] at http://bit.ly/2k75pt8.

[102] "Lista Obiectivelor de Investitii si sumele alocate acestora pentru finantarea Programului National de Dezvoltare Locala", MDRAP, available [in Romanian] at http://bit.ly/2krGEs1.

[103] "Lista responsabililor judete PNDL", MDRAP, available at http://bit.ly/2lQEjqD.

[104] "Plati activitate curenta, plati programe europene", MDRAP, available [in Romanian] at http://bit.ly/2mcTMBT.

[105] Interview with Andreea Grigore, MDRAP, 19 April 2019.

[106] Interview with Andreea Grigore, MDRAP, 19 April 2019.

[107] 13 Ibid.

[108] Interview with Septimiu Parvu, Expert Forum, 23 April 2019.

[109] Interview with Andreea Grigore, MDRAP, 19 April 2019.

[110] Interview with Septimiu Parvu, Expert Forum, 23 April 2019.

10. Improve transparency in allocations and acquisitions from national investment funds

Limited

According to the OGP repository, the Ministry of Development, Public Works and Administration (MDLPA) identified and published all publicly relevant datasets related to the National Program for Local Development (PNDL). These datasets relate to the awarding, contracting, implementing, and evaluating of investments. ^[56] However, as the IRM Design Report mentioned, these datasets do not include information identified by civil society as relevant. [57] MDLPA did not organize the planned public debate and did not define new procedures to publish the datasets, as set out in the action plan. Moreover, MDLPA did not meet with representatives of Expert Forum prior to organizing the debate. [58]

MDLPA regularly updated its open datasets during the action plan period (e.g., the payments section on a quarterly basis, [59] and the PNDL allocations every six months [60]). However, MDLPA did not expand these datasets to include more information than what it published prior to the fourth action plan.

While this commitment saw limited completion, Romania has carried forward some of the incomplete activities into the fifth action plan (2020-2022). [61]