Polish road funding on hold

European Commission (EC) funding worth €950 million for Polish roadbuilding projects has been interrupted while investigations are carried out into an alleged price fixing cartel.

In Poland, 11 people – including a former director of the General Directorate of National Roads & Motorways (GDDKiA) – have been charged with price fixing.

The EC’s Directorate-General for Regional & Urban Policy, which has responsibility for the European Regional Development Fund, is waiting for the results of anti-fraud investigations to see what the extent of the fraud was. It also wants to ensure such fraud is being eliminated and that other companies are not involved.

Additionally, it wants to be satisfied that control systems are sufficiently robust for the future.

Two EC-funded programmes are affected. The first, Infrastructure & Environment, involves the bulk of the funding at €880 million, while the second is called Development of Eastern Poland.

The EC is making it clear that it is an interruption in the funding, rather than a suspension or anything more dramatic, and when Commissioner Johannes Hahn was asked last week whether the interruption in funding might be lifted by March, he said it was “not unlikely”. There is no exact timescale, however.

Commissioner Hahn met with Elzbieta Bienkowska, Polish Minister for Regional development, and Slawomir Nowak, Polish Minister for Transport, last week, and was reassured that the Polish authorities were taking steps against fraud of this kind.

The Directorate-General for Regional & Urban Policy said that there were 189 interruptions to funding last year, two of them Polish. It said it was one of the means it had to check and safeguard taxpayers’ money.

It is believed that the alleged cartel involved three projects, only one of which had been successful in fixing prices.