Brussels, 24/05/2012 (Agence Europe) - The Czech Republic is in fact subject to a “rather high” budget risk if the European Commission maintains the freeze on Structural Funds decided in response to the financial irregularities observed, acknowledged Czech Prime Minister Petr Necas on Thursday 24 May following a meeting with the president of the European Commission, José Manuel Durão Barroso. “The situation is quite serious”, added Necas. In the worst case, in other words if the Commission does not pay “€10 billion” in co-financing planned for 2012, the deficit will reach “6%” in relation to GDP, while the Czechs hope to take it below the 3% bar. This is a situation which will destroy the Czech budgetary strategy, Necas believes, for whom “every euro counts and must be spent effectively”.
Barroso considers that good management of structural funds in the Czech Republic, in terms of regularity, eligibility and deadlines, is of crucial importance. This is particularly important because the Czech Republic is the main per capita beneficiary of European cohesion policy for the 2007-2013 period. Over this period, €38.6 billion was allocated to this member state. An action plan is currently being applied in an effort to correct the irregularities observed. The Commission will proceed to audits in June and July with regard to the measures adopted by the Czech authorities. It will not be until this exercise is completed that it will decide, at the latest by the end of July, whether it will start to pay structural fund payments again.
Agenda for growth. Necas said that growth is essential but could only materialise in a stable and sustainable environment. He also said that they had to focus on budgetary discipline and that he was convinced that there was no other reason to modify this approach. This is, indeed, music to the ears of Barroso, who is pleased with the support provided by the Czech leader to the Commission crisis exit strategy which focuses on cleaning up public finances and stimulating growth. (MB/transl.fl)