Romanian Agric Ministry Plans To Soften EU Funding Restrictions On Debtors

The Agriculture Ministry drew up a draft government decision eliminating the one year period over which beneficiaries with debts were not allowed to submit other projects requesting funding.

The same restriction will apply to beneficiaries of funding via the National Rural Development Program, and an investor with debts for a project may not submit a new project until he has paid previous debts and penalties.

"There have been many cases when beneficiaries were penalized too harshly. For instance, let’s say a local council built a sewage system and invested EUR1 million, but did not deduct an electricity meter worth 200 lei (EUR1=RON3.6724) within the project. The investor is penalized for that RON200 and registered as debtor. Moreover, the beneficiary may not even be at fault at all and it could all be a mistake, such as the deduction of the same expense twice. The beneficiary must refund all the extra money, also considered debt, although he is not to blame,” said the agency’s general manager Laszlo Klarik.

Beneficiaries of SAPARD funds must observe a set of rules when accessing rural development funds via the national program, to avoid double financing and other irregularities.

For instance, a beneficiary with a SAPARD-funded project underway may not submit a similar project via the national program until after the first investment is completed.

The National Rural Development Program, launched on March 3, allows Romania to access EU funds of nearly EUR8 million by 2013 to upgrade farms, increase the added value of farming and forest products and develop villages.