Deficiencies were primarily identified in the processes guaranteed by the Agricultural Payments Agency (APA), but also by the Ministry of Agriculture and Rural Development of the Slovak Republic (MARD) and the Ministry of Investment, Regional Development and Informatics of the Slovak Republic (MIRDI). "Fundamental managerial failures have resulted in very poor absorption of European money. However, the inaction of the state authorities may have put not only the action groups but also several local authorities involved in the activities of the LAGs in a very difficult financial situation. In the Rural Development Programme, for which the APA is responsible, the uptake in the second half of 2024 was only 11% of the allocation, with more than EUR 90 million still to be accounted for by the end of this year. The risk that Slovakia will not use the generated funds is high, while the financial impact of their non-use will be borne by action groups and local governments. Or the sanctions for long-standing unsolved shortcomings will go to the state budget, " said Ľubomír Andrassy, the chairman of the national auditors, summarising the conclusions of the cross-sectional audit.

Establishing local action groups operating on a bottom-up basis was supposed to improve the quality of life in rural areas and support the development of basic services for the inhabitants of the regions through projects responding to local development needs. The projects, also financed from European funds, were aimed at repairing public buildings and pavements or supporting local entrepreneurs, up to a maximum of EUR 100 thousand. "LAGs have been and should be an innovative tool for local sustainable development. They connect natural regions and respond to people's demands through public-private partnerships, whose members know best the current state of the region and the possibilities for its development. Communities formed in this way are able to model activities that will support the local economy, contribute to sustainable regional development, and include social benefits," says Ľ. Andrassy. In addition to the two ministries and the APA, the auditors examined 16 selected action groups. They checked how funds amounting to more than EUR 170 million were used between 2017 and 2023 and what constituted barriers to their use.

Read the full text of the press release about this issue in Slovak language.