ZAGREB, August 30, 2018 - Economy Minister Darko Horvat said on Thursday that an application procedure for the allocation of EU grants for small and medium entrepreneurs, during which 53 million kuna was allocated in just 35 seconds, would be annulled.
The Economy Ministry procedure, designed to help improve the competitiveness and efficiency of small and medium enterprises through ICT, lasted only 35 seconds on Wednesday.
Entrepreneurs wishing to upgrade their operations with information and communications technologies started submitting their project proposals at 11 a.m. but the ministry's system stopped further registration after only 35 seconds because the amount of grants sought in processed project applications exceeded 200% of the total allocation.
The other entrepreneurs, with 589 applications that could not be submitted, suspect software irregularities or irregularities in the allocation of funds.
"When an application procedure for which you prepare 53 million kuna receives a response from the real sector that exceeds the approved funding three times, it only means that we have chosen the right application procedure. We will discuss the situation during the day and most probably annul the procedure, secure more money and invite applications anew. We want all those who apply and who meet the ministry criteria to obtain EU money and increase their competitiveness," Horvat said ahead of a government session.
Asked by reporters why speed was crucial in the allocation of funds, he said that it was not and that project quality would be the key factor. He added that things could have been done differently, but that the ministry was now aware of entrepreneurs' interest and would prepare EU funding accordingly.
Regional Development and EU Funds Minister Gabrijela Žalac said before the government session that the application procedure in question was not her ministry's but one of the Economy Ministry which, she said, wanted it to be the way it was.
"More than 800 applications were submitted for the 53 million kuna allocation, and the value of those applications exceeded 350 million kuna. I will increase the allocation, but I will certainly see to it that procedures like this one do not happen again," Žalac said.
She said that she did not know why the Economy Ministry had opted for such a procedure given its insufficient capacity to process project applications.
She said that there were no irregularities in the procedure and that applicants should not worry.
Asked where she would find money for a higher allocation, she said that she would find it in EU funds.
