The Court of Auditors continues to find gaps in the information on the cost of measures in response to Covid-19 and recommends the Government to quantify its impact in a disaggregated manner, including the revenue that is no longer collected.
In its second report on the budgetary implementation of response measures to Covid-19, which covers the period up to 30 September, the Court of Auditors sees improvements in reporting information compared to what it found about the first three months of the pandemic, but continues to detect flaws and limitations that “weaken information monitoring”.
For the institution chaired by José Tavares, reporting information on measures to mitigate the impact of the pandemic, whether in terms of expenditure, loss of revenue or assumed responsibilities, is “vital” for the respective management and even for planning new measures.
Noting that the first line of reporting information on the response to the pandemic comes from the Budget Execution Summary (SEO), prepared by the Directorate-General for Budget (DGO), the Court of Auditors states, however, that in what covid measures say respect, “and despite the verified improvements”, the SEO report “continues not to be exhaustive and without a sufficiently robust level in the information systems that originated it”.
According to the institution chaired by José Tavares, with regard to the “quantification of the total cost resulting from the Covid-19 measures, there is still no orderly system of accounting information that allows the impact to be identified”, namely of contingent support, such as granting of guarantees and lines of credit and surety bonds, part of which the State may be called upon in the future or of interest subsidies associated with lines of credit.
The same applies to unpaid accounts, namely debts to suppliers and overtime or accounts receivable, for the extension of deadlines for payment of taxes and contributions, or even for the impact on revenue, either through exemption or reduction measures. taxes and contributions or the effect of the contraction of the pandemic on economic activity.
In the case of Social Security, the report states that the estimate presented for the loss of revenue due to total or partial exemption from the payment of the single social fee borne by employers “which appears in SEO has limitations”, since the data presented by the Institution Social Security Financial Management (IGFSS) are not coincident, making verification difficult.
And, after the responses of both entities (DGO and IGFSS) in contradiction, the report concludes: “It is verified that, for the same amount (508.7 until December), the measures indicated by DGO do not coincide with those identified by the IGFSS, revealing disarticulation and making verification difficult “.
In view of the information and reporting weaknesses it has detected, the Court of Auditors recommends that the Ministries of Finance and Social Security promote conditions, so that “both at the level of central administration and social security, it is possible to quantify the disaggregated impact of all measures taken in the context of the Covid-19 pandemic, including revenue that is no longer collected “.
It also recommends that the Government promotes conditions so that the impacts translated into financial flows are recorded in the appropriate measures and that instructions are issued that ensure consistency in the use of the budgetary measures related to Covid-19.
The institution also points out the need for full information to be released, including financial, physical data (such as the number of beneficiaries) and result indicators.
The document states that “the monitoring of measures, in terms of their execution, is still limited by the fact that the measures introduced by the Assembly of the Republic and which amended the supplementary budget law proposal, have not been reflected in the respective revenue budget statements. and expense “.
The report adds, however, that recognizing weaknesses in reporting and support systems for budget execution, the Ministry of Finance “issued new instructions, already on February 17, 2021, to adjust the processes for gathering information on associated budget execution. the Covid-19 pandemic and the economic and social recovery measures, applicable from March 2021 and the final budget execution of 2020 “.
According to the document, the impact of Covid-19 measures up to September 30 reported in the SEO for October totals 2,801 million euros, of which 68% (1897 million euros) in the scope of Social Security, and 32% (904 million euros) in the central administration.
In this second report on the budgetary implementation of the measures taken in the context of the Covid-19 pandemic, the Court of Auditors stresses that “the diversified nature of the measures”, “the urgency” of the decisions taken regarding their architecture, application and use, the amount of public money involved and the “uncertainty” about the future of the pandemic “require constant monitoring of the measures, based on a rigorous, complete and detailed report”.
Source: Renascença – Noticias by rr.sapo.pt.
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