Tuesday 6 January 2009

TACIS funds for Russia were a waste of money (updated)

For years, the European Union has been financing assistance programmes in its geographical and political neighbourhood, especially in the former Soviet Union, including Russia.

The main financial aids for Russia under the EU-Russia Cooperation Programme came from the so-called TACIS (Technical Assistance for the CIS countries), in place from 1994 until the end of 2006 for the main CIS country.

Thanks to a newly published document of the Council of the European Union, I found the conclusions of the Council (doc) from its meeting on 17 July 2006 where it
"Notes with concern the main conclusion of the audit that the efficiency of the use of TACIS funds in the Russian Federation has been low. It regrets that the objectives were not met in a number of the audited projects and that projects were deemed sustainable in only a few cases. It also regrets the lack of a real dialogue between the Commission and the Russian authorities and the consequent lack of a sense of ownership on the Russian side. Given the size and duration of the programme, the audit results can only be seen as disappointing."
Using "disappointing" in a diplomatic document sounds rather strong, and the assessment that major parts of the TACIS programme in Russia have been a failure raise the question whether sticking for 12 years to a programme and projects that do not have any considerable effect was necessary and right.

This question is especially relevant since under the European Neighbourhood Policy (ENP) and other technical assistance programmes, the European Union is still financing an huge number of activities in the countries of the former Soviet Union.

Are these effective, efficient, helpful? Or is the European Union sticking to programmes and activities that cost a lot of money but remain without relevant impact? These questions have to be answered, and I am afraid that they are not seriously raised, especially not publicly.

In order not to be misunderstood: I am in favour of supporting democratic developments - technical and political - in the EU neighbourhood, including Russia. But I am in favour of a self-critical assessment of what we are financing, how useful it is, and how we can improve it.

And I am against waiting for 12 years to realise that what we are doing is full of good intentions but without any considerable effects!

(Updated on January, 6. First version published on Januar, 3.)

On the request of Petr, here some more details on the TACIS programme and the evaluation of its implemenation in Russia:

The objectives of TACIS, which in the case of Russia is now run under the European Neighbourhood and Partnership Instrument, were the following:
  • assistance for institutional, legal and administrative reform (development of the rule of law, support for effective policy-making, support for justice and home affairs activities, etc.);
  • support for the private sector and assistance for economic development (promotion of small and medium-sized enterprises (SMEs), development of the banking and financial systems, promotion of private entrepreneurship, etc.);
  • assistance in addressing the social consequences of transition (reform of the health, pension, social protection and insurance systems, assistance for social reconstruction and retraining, etc.);
  • development of infrastructure networks (transport networks, telecommunication networks, pipelines, border crossings, etc.);
  • better environmental protection and management of natural resources (alignment of standards on Community norms, sustainable management of natural resources, etc.);
  • development of the rural economy (land privatisation, improvement of distribution and access to markets);
  • support for nuclear safety. (source)
The assessment made above, and the conclusions by the EU Council are based on the SPECIAL REPORT No 2/2006 concerning the performance of projects financed under TACIS in the Russian Federation issued by the European Court of Auditors in March 2006 in which it concludes that out of 29 projects assessed (out of a total of 275 worth 56 million Euros) only 9 fully achieved their goals and only 5 produced sustainable results.

The audit report noticed the following shortcomings in the project planning and implementation:
  • Objectives not achieved or achieved only partially (only small projects successful)
  • Poor application of the Project Cycle Management System
  • Long project-planning schedule
  • Unrealistic underlying assumptions and objectives
  • Imprecise or missing objectives
  • Unsuccessful selection and involvement of beneficiaries
  • Rare national co-financing
  • Delays in implementation
  • Ineffective steering committees
  • Equipment not used for the purposes of the project
  • Purchases free of VAT from domestic suppliers impossible
  • Poor dissemination and poor sustainability (e.g. discontinuation of project websites)
  • Lack of evaluation
I recommend reading the full ECA report in order to get the full picture. It seems as if a good part of the problems are self-made problems by the Commission which did not apply proper planning and evaluation, while the rest are related to internal shortcomings in the Russian Federation. However, since those activities usually should be joint (i.e. "partnership") projects between the Commission and the beneficiary - in this case Russia - it is not always useful to distinguish between the partners when it comes to the responsibility for (partial) failure.

The report - and the subsequent harsh assessment of the EU Council - show that although the European Union and its Commission have high standards and high expectations, the implementation of policies - here: foreign aid - is not very effective, which means that we spend millions of Euros in high expections but low results.

My personal and professional experience in the field of international work so far is quite similar - high expections plus a lot of money lead to rather low outcomes - which raises concerns about whether the report on TACIS money for Russia does not represent a more general picture about how the Union and other international organisations are working in the field (and back in their headquarters).


Unknown said...

That whole commentary is a bit vague, Julien.

What was the expectation?
What was (and was not) acomplished?

Julien Frisch said...

Sorry, I might have been a bit in a hurry... Will expand the article to answer your questions as soon as I have some time (probably tomorrow evening).

Petr Frish said...

Thank you.

I looked at the report too.

Interesting - and looks very
bureaucratic too. One wonders what were the human stories behind the formal evaluations.


Julien Frisch said...

This bureaucratic language is a massive problem of the European Union institutions.

To get the human stories, we might have to investigate individual projects and ask the participants, the local European Commission staff charged with the planning and supervising as well as the relevant people in the Commission, the Council, and the Court of Auditors - a hell lot of work which is can only be done by professional journalists with appropriate contacts and funds...