Final Report - European Commission - Europa

Chapter 3 Explaining the performance of the Phare programme 47
D. Resources and procedures
As in other countries, the EC’s ability to engage in policy dialogue and donor
coordination is constrained by the Commission’s limited capacity and timeconsuming
administrative procedures. However, in Albania, these constraints have
been exacerbated by extremely poor management and financial controls and by poor
cooperation between EC Headquarters, the Delegation in Albania, and the Albanian
authorities. A number of recent reviews commissioned by the Delegation identified
widespread weaknesses in financial controls, allowing for serious irregularities,
while transparency and accountability have been poor. In the considered view of the
Evaluators, these factors have limited the impact of the EC programme (see Chapter
2). Commission Headquarters, (EuropeAid and DG RELEX) do not accept the
validity of these studies; partly as a consequence, the relationship between
Headquarters and the Delegation has broken down. Urgent management action is
required.
The Decentralised Implementation System
Phare assistance to Albania was initially managed by the Commission under the Centralised
Implementation System. In 1994, the Commission began the introduction of the Decentralised
Implementation System (DIS) in Albania. Under the DIS, implementation is mostly managed by the
Albanian government: tendering, contracting and payment procedures are the responsibility of the
relevant PMU with supervision from the Delegation or Commission Headquarters. Currently there are
PMUs in the Ministries of Transport, Agriculture and Public Works; the PMU (European Dimension)
is responsible for projects in other ministries and departments, including most importantly justice,
home affairs and public administration. However, some programmes are still managed directly by
Headquarters (e.g. TA of the PIU in the Ministry of Justice).
The Albanian authorities are responsible for the preparation of strategic plans, work programs and
tender documents. The Delegation can approve the awarding of contracts up to certain limits, and also
should provide advice, supervision and assistance to the authorities. Commission Headquarters approve
tender documentation and the awarding of contracts above those limits, and are primarily responsible
for programming.
The Decentralised Implementation System is excessively complex but it could work if all
parties were to act cooperatively. In practice, the opposite occurred, with the result that aid
implementation in Albania has been extremely poor. Not only did each of the three key
actors fail in their assigned role, the relationship between the three positively reinforced,
rather than mitigated, their different failings. The poor performance of these actors has been
described in Chapter 2 (Impact of the Phare programme) and is a key factor in explaining the
very low impact of the EC programme.
Project Management and Implementing Units
For the most part, PMUs and PIUs in Albania have not properly fulfilled their assigned
functions (as described in monitoring reports and interviews with Delegation staff).
Moreover, they have provided very little input into the management and monitoring of the
programmes. This weakness has a number of causes:
• most importantly, the low pay of PMU/PIU staff, with salaries typically in the range of
$80-100/month, coupled with the demands made on them and poor working conditions.
This is scarcely a living wage in Tirana, and certainly not sufficient to attract skilled and
competent staff; 1