39 recommendations for strengthening supervision and ensuring effective management of public funds

❊ Inadequate administration makes it difficult to implement some programs and measures of public authorities

The Audit Court called for the strengthening of internal control mechanisms and the establishment of healthy and efficient management of public funds and assets, among the 39 recommendations it made in the annual report for 2022, which indicate the impossibility of ensuring the control of economic and financial information, the following – use public funds invested by the state and develop strategies related to it.

The Audit Court has published the content of its annual report, which it submits to the President of the Republic every year, in accordance with Article 199 of the Constitution, because it published 14 letters containing the most important results of the audit conducted in the implementation of its annual program for 2020.

The memoranda included in the report, which is in the possession of Al-Masa’a, indicate the inspections and evaluations of the conditions for the management of financial resources and public funds by the entities that were subject to supervision, along with the recommendations that the Council considered necessary to submit to public authorities, in addition to the responses of officials , legal representatives and respective guardianship authorities to whom the list notes were sent. In light of compliance with the attendance procedure, including responses received from managers or representatives of competent authorities.

The report contained four chapters, three of which were dedicated to the state administration, local authorities, public companies and institutions, while the fourth chapter was dedicated to the financial resources, human resources and international activities of the Court of Auditors.

The Audit Court’s supervision of state administrations was focused on management and supervision systems applied to the economic public sector, where “many shortcomings that make it difficult to implement certain programs and measures initiated by public authorities in the economic and social sphere” were highlighted.

This situation refers to the program for the development of the logistics network and the public cooling network with the aim of controlling the market of consumer agricultural products (Ministry of Agriculture and Rural Development), and to the financial support granted by the state to promote exports (Ministry of Trade and Investment Promotion) and the national perinatal program aimed at reducing some of the problems that affect maternal and fetal health.

In the section on local communities, the focus was on the conditions for the management of school restaurants by municipalities, since the audits, which included a diverse sample of restaurants distributed in 48 municipalities belonging to 16 states located in urban, semi-urban and rural areas, showed “the impossibility municipalities to ensure a meal that complies with the necessary standards.” For school children, due to the difficulties associated with the organization, management and financing of these restaurants.

The watchdog also paid attention to municipal processing programs, noting “a huge amount of stalled projects”, despite financial credits, whether they came from their own sources, such as the Hassi Messaoud municipality in the Ouargla vilayet, or those granted by the state through Solidarity and guarantee fund for communities. Local, as is the case with municipalities in the state of Blida.

The supervision carried out over the provinces of Oran and Sidi Bel Abbes also clearly showed that “the decentralized management of the budget and assets does not respect the principles of internal control and the instructions of public bodies related to the rationalization of public expenditures”, which was the source of many “violations and wasteful situations in the use of financial resources and resources of these local groups”.

In the part dedicated to utility companies and institutions, the omission was aimed at the public institution of an administrative nature “Local Communities Solidarity and Guarantee Fund”, the independent administrative body “Electricity and Gas Control Commission” and two public institutions of an industrial and commercial nature, “National waste agency” and “National Center for Training and Education,” showed Teleprofessionals”, “Poor performance of these bodies, compared to the financial resources used by the state to ensure their functioning.” The authors of the Court of Auditors report confirmed that the imbalances and deficiencies that characterized the organization and management pattern of local groups “represented real obstacles” that made it impossible to fulfill the tasks entrusted to them.

Non-hydrocarbon export fund under the microscope

The supervisory procedure related to the conditions for the use of financial resources allocated to the Fund for the export of non-hydrocarbons for the period from 2017 to 2020 showed that it “did not significantly contribute to the development of exports.” In the report of the Audit Court, it was stated that if the funds available until 2020, estimated at 49 billion dinars, were used only within 3%.

With significant delays recorded in the processing of exporters’ compensation claims, the number of companies benefiting from export promotion subsidies remains “small”.

Despite the different costs eligible for support, the subsidies granted are mainly limited to “the costs of participation in the demonstrations and fairs to which the Algerian company for exhibitions and exports “Safex” has committed, or compensation for part of the transport costs incurred by the exporter.

In the report, this situation is mainly attributed to “the lack of annual work programs that define the measures to be taken, as well as the goals to be achieved and the deadlines for their achievement, in addition to the absence of material and financial results supported by sufficient information and that meet the required conditions in the area of ​​evaluation of results. “

The audit process carried out by the Ministry of Trade and Export Promotion, based on the data obtained, made possible the conclusions of the observations, the most important of which is that the amounts allocated for export support are small compared to the approved funds allocated annually to the fund, significant delays in the processing of requests for compensation due to exporters that sometimes exceed eight years and the absence of real export promotion programs to encourage the export of products Sophisticated and diverse.

The report added that this situation, which has been going on for years, was caused by “improper practices in the management of compensation files in a way that discourages the traders concerned and has a negative impact on export activities”, noting that financial subsidies paid to the fund several years ago to promote exports are often is awarded in favor of the Algerian Exhibition and Export Company.

In order to face this situation, in its recommendations related to this file, the Court of Auditors called for measures to be taken to improve the efficiency of the support mechanism for export promotion, either in terms of organization and administrative management or the conditions of monitoring and evaluation procedures of financial subsidies aimed at encouraging export and the development of support programs in favor of companies with strong export capabilities, in a way that guarantees access to foreign markets.

In the field of industrial and public commercial institutions, the council recommended the establishment of a national body for the management of state contributions as the successor of the Council for State Contributions, to achieve the status of a shareholder for the state, supported by the necessary powers and resources, while defining the relationship of ministries with industrial complexes and unaffiliated public economic institutions, with the aim of ensuring the independence of practical decisions of the directors of economic complexes and public institutions, as well as promoting a policy of partnership with the domestic and foreign private sector in order to ensure the best management of the institution, while allowing the state, on the other hand, to devote itself to economic public institutions that it considers strategic.