Greece missing tech train

The inability to absorb generous European Union funding for information technology public sector projects means Greece faces the prospect of missing out on a unique opportunity to modernize its state administration and, consequently, boost growth across most economic sectors. Even after the government managed to salvage some EU funds certain to be lost by diverting them into other projects, the Information Society program has still absorbed less than a third of the remaining earmarked funds (930 million euros of a total of 2.95 billion). According to the rules of the Third Community Support Framework program (CSF III) all contracts for the program must be signed by the end of the year and the funds absorbed by the end of 2008. These are worth 1.5 billion euros, slightly more than those signed over the previous five years. Few believe it is possible for the state to sign all these contracts, given the performance of the state administration. Also, of the 1.45 billion euros’ worth of contracts signed, 520 million have yet to be absorbed and the EU must provide funds by December on proof that some progress has been achieved. With its back to the wall, the government is holding an emergency meeting of the program’s Monitoring Committee on Wednesday. Pressure will be put on all concerned – the ministries and private contractors – to push projects forward. Privately, officials fear the loss of funds, since there is no more leeway given by the EU to divert CSF III money into other areas. The management of the program by successive governments has been catastrophic, with the state administration more focused on pleasing all bidders than implementing the projects. Initially, projects were split into several contracts to provide each bidder with a slice of the pie. Now, contractors are stalling projects, with losing bidders appealing to the courts against the winners. IBM and Intracom, for example, are at each other’s throats over three big projects. The end result is that about 2 billion euros’ worth of projects are currently up in the air.