By Evgenia Tzortzi

The immediate revision of the subsidies program of the National Strategic Reference Framework (ESPA) is the only way to avert a loss of funds for projects that have been delayed, as the targets set by the bailout agreement are unlikely to be met.

The annual target for fund absorption this year is a European Union contribution of 3.7 billion euros and state spending of 4 billion euros, but the payments to date, three-and-a-half months before the end of the year, amount to just about 1 billion.

The delay is attributed to corruption cases connected to the Private Investments General Directorate regarding projects that benefited from investment incentives legislation passed in 2004 and led to a freeze of payments from Brussels. The twin general elections this spring also contributed toward the delays.

The Development Ministry is now working feverishly on the revision of ESPA, focusing on the transfer of funds between projects that have funding needs and on the streamlining of the whole framework by excluding projects that are unlikely to be completed in time.

The government estimates that out of the total 24 billion euros in available ESPA subsidies, some 7.5 billion concerns projects that are at serious risk of not being executed by the end of 2015. This represents about one-third of the ESPA projects, and if they are not completed in time, the state will be expected to foot the entire funding bill. The application period of ESPA is until 2013, but community regulations allow for a two-year extension.

Projects related to the environmental sector are viewed as the most problematic, especially in terms of overpricing, according to a report by the Development Ministry. Provided that the value of the contracts signed, reaching up to 394.7 million euros, has to be paid in full, the target set by the country’s bailout agreement with its creditors is considered “impossible to meet” by the ministry.