STATE AUDIT OFFICE
- Press Release-
Skopje, 28.06.2021
Inadequate control over concessionaires results in irrational use of mineral raw materials and lower budget revenue
Measures and activities taken by the competent institutions are not sufficient to ensure effective management of mineral raw materials, in terms of their optimal utilization and efficient collection of concession fees in line with the principles of sustainable development
The State Audit Office conducted performance audit on the topic “Effectiveness of measures and activities for utilization of mineral raw materials and collection of fees” to answer the question whether measures and activities provide effective utilization of mineral raw materials and collection of fees in line with the principles of sustainable development.
Lack of long-term strategic planning, frequent amendments to legal provisions and absence of bylaws, insufficient institutional cooperation, and incomplete cadaster of deposits and occurrences of mineral raw materials do not provide solid basis for effective management policy for mineral raw materials in RNM.
Unspecified deadlines and untimely signing of contracts prolong the procedures for granting concessions for mineral raw materials, which has negative implications on the economic interest of the entities, and insufficiently regulated contractual obligations of concessionaires do not provide legal protection in case of non-compliance.
Concessionaires are not obliged to submit calculations for sold quantities of mineral raw materials; and there are unregulated issues concerning fees for exploited quantities used for own needs and in cases when more than one mineral raw material is exploited in the same concession area.
The established system for collection and recording of concession fees does not provide for checking calculations, which limits the supervision and control of completeness and reliability of revenue from concession fees.
As a result of these shortcomings, , less concession fees were collected in the period 2016 – 2020 amounting to 33 million denars, of which 14 million denars based on exploitation area and 19 million denars based on exploited mineral raw material.
For the same period, 695 million denars were collected untimely i.e. with delay (83 million denars based on exploitation area and 612 million denars based on exploited mineral raw materials), and without calculated legal interest.
Out of four concessionaires subject to inspection, three are excavating mineral raw materials outside the exploitation license they possess over an area of 25.546 m2.
Concessionaires use different calculations i.e. some of them do not present and pay the fee for the amount of silver metal in both lead and zinc concentrate, which results in less calculated and paid concession fees.
Some concessionaires for metallic mineral raw materials do not present and pay the fee for the amount of silver metal in both lead and zinc concentrate. One concessionaire has small flotation utilization of zinc metal and large percentage of leakage in the tailings.
The authorized state auditor finds it necessary to point out that following the inspection and audit indications to the concessionaires, additional 10 million denars were paid.
Performing inspection supervision without defined criteria for selection of entities, incomplete implementation of planned regular inspections, partially performed control supervision upon issued decisions for elimination of irregularities, absence of independent accredited laboratory, lack of financial resources and equipment do not provide for effective control mechanism.
To overcome identified shortcomings, the authorized state auditor made recommendations for improvements in relation to: legal and institutional setup of the management system for mineral raw materials; functionality and effectiveness of procedures for granting/revoking concessions for mineral raw materials; collection of concession fees and mechanism in place for supervision and control over the operation of concessionaires for optimal use of mineral raw materials in line with sustainable development principles.
Link to the Audit Report:
Press contact:
Albiona Mustafa Muhadziri +389 72 228 203
[email protected]
Mijalche Durgutov +389 70 358 486
[email protected]
Martin Duvnjak +389 75 268 517
[email protected]