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Wide spread and uncertain effect of the EEA and Norway Grants - management by objectives and results should be strengthened

The purpose of the EEA and Norway Grants is to contribute to the reduction of social and economic disparities in the new EU member states. The Office of the Auditor General (OAG) recommends strengthening management by objectives and results. - While it is positive that the distribution has become more concentrated, spreading the grants among 147 programmes in 15 countries still makes it difficult to ensure achievement of objectives, says Auditor General Jørgen Kosmo.
Published 9/17/2013 12:30 PM

Document 3:15 (2012-2013) The Office of the Auditor General's investigation of the EEA and Norway Grants was submitted to the Storting on 17 September 2013.

The audit covers the EEA and Norwegian Financial Mechanisms 2004-2009 and 2009-2014, up to January 2013. Norway gave approximately NOK 10 billion to the less prosperous EU countries in the period 2004-2009. In the period 2009-2014, Norway will contribute just under NOK 14 billion.

The OAG's audit shows that while the projects were largely carried out as planned in the period 2004-2009, no provisions were made to measure the outcomes of the support in either the projects or sectors or at the national level. The grants were divided among 1,245 projects in ten sectors.

Based on its experiences from the funding period 2004-2009, the Ministry of Foreign Affairs has introduced a programme-based management model for the period 2009-2014. Each programme area is defined with an objective and expected outcomes. Support is provided to projects under each programme.

- It is positive that the programme model facilitates a more concentrated and results-driven effort, which provides better preconditions for achieving good results. However, there is a high number of programmes in many sector areas, giving rise to a risk of poorer achievement of objectives than if the support had been divided among fewer and larger programmes in the individual countries, says Kosmo.

The OAG finds that the work of measuring outcomes has been strengthened, but points out that the programmes primarily provide information about the scope of the support, and less about outcomes and long-term impacts.

- The OAG recommends that the Ministry of Foreign Affairs place even more emphasis on results-based management, says Kosmo.

The programme model has introduced a new level of management in the beneficiary states, with programme operators who administer a large number of projects. This also means that while the Norwegian-funded part of the EEA and Norway Grants increased by about 37 per cent from the period 2004-2009 to 2009-2014, administration costs are expected to rise by 76 per cent.

- The OAG recommends that the Ministry of Foreign Affairs follow up the complex management model to safeguard control requirements and ensure good achievement of results. The largest possible share of the grants must go to programmes and projects in the beneficiary states, says Kosmo.

An overarching objective for the period 2009-2014 is to strengthen bilateral relations between Norway and the beneficiary states. Contact will now be better safeguarded in that 23 Norwegian programme partners have entered into donor programme partnerships with programme operators in the beneficiary states.

- It is positive that bilateral relations at the programme level have been bolstered, says Kosmo.

In his response, the Minister of Foreign Affairs states that while the negotiation process for the current grant scheme resulted in several countries ending up with a larger number of programmes than desired on the Norwegian side, creating capacity challenges on the donor and beneficiary sides, the programme model cannot be blamed for this. Furthermore, the Minister notes that establishing a common understanding of results-based management will take time. This is a relatively demanding process, given the fact that the EEA and Norway Grants cover 15 relatively different countries and a number of new partners on both the beneficiary and donor sides, as well as the donor states Norway, Iceland and Liechtenstein, writes the Minister.

The new programme model, with expanded bilateral cooperation, more integrated project portfolios, better control and management, is expected to strengthen the achievement of results. In light of this, the increase in administration costs is not unreasonably high, writes the Minister.

You can download the document through the link to the right.

Public institutions can order the document from the Government Administration Services, tel. (+47) 22 24 20 00, publikasjonsbestilling@dss.dep.no. Others can order it from Fagbokforlaget AS, tel. (+47) 55 38 66 00, offpub@fagbokforlaget.no.

The deferral of public access to documents prepared by or for the Office of the Auditor General in connection with Document 3:15 (2012-2013), cf. the Act relating to the Office of the Auditor General section 18 second paragraph, is hereby set aside.

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