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The governmental Local Investment Fund (FIL) is a 12 bn zloty-heavy financial support program for local governments whose budgets have suffered during the pandemic. In the second stage of distributing the grants, nearly all major cities were omitted. Local government officials protested, demanding that the Prime Minister and governors explain the rationale behind the distribution of nearly PLN 6 billion.- We were not informed about the criteria and existing procedures. We suspect that party affiliation might’ve been one of the crucial conditions here - said Piotr Grzelak, the deputy mayor of Gdańsk.
Provincial governors explained that the decisions concerning the distribution of funds were made by the central government, which in turn relied on the recommendations of a committee appointed specifically for this purpose.
Party affiliation generously rewarded
In a report commissioned by the Batory Foundation, Dr. Jarosław Flis and Prof. Paweł Swianiewicz found that in the second tranche of distributing the Local Investment Fund support grants, the money was allocated largely along party lines.
"In municipalities governed by Law and Justice MPs, the average subsidy amounted to over PLN 250 per person. At the same time, in municipalities headed by members of the opposition, the subsidies were ten times lower. (...) Although municipalities governed by members of the ruling camp comprise only 9% of the country's total population, they received 28% of all the grants awarded under the program. On the other hand, in the case of municipalities governed by oppositional politicians, these proportions were reversed. Although municipalities led by the opposition make up almost one-third of the country’s total population, they received only 10% of the grants. (...) It is a shocking phenomenon unseen anywhere else (at least not in Western Europe). Here, party affiliation is not the dominant rationale behind distributing the money, but rather takes the form of a subtle nudge”- reads an excerpt from the report.
No record of committee meetings. No written justification for allocating the funds
Pointing out that the Local Investment Fund was supposed to help local governments whose budgets have suffered during the pandemic, a group of MPs from the Pomorskie province (Barbara Nowacka, Piotr Adamowicz, Agnieszka Pomaska, Małgorzata Chmiel, Marek Rutka, Henryka Krzywonos-Strycharska) asked the Prime Minister to explain the decision.
Jarosław Wenderlich, a staffer at the Prime Minister's Office, answered their questions on behalf of Prime Minister Morawiecki.
Why did the three coastal cities of Gdańsk, Gdynia, and Sopot not receive any support?
Mr. Wenderlich explained the decision arguing that the government received more than 10.000 applications for a total amount of nearly PLN 63 billion PLN, i.e. over ten times more than the available funds. He concluded that it had not been possible to grant support to all the local governments.
The opposition MPs asked for access to the protocols prepared by the committee tasked with evaluating submitted applications. They did not receive any documents. According to Mr. Wenderlich, the committee was not obliged to justify its decisions in writing. - It is not possible to provide a written justification for each of the individually submitted applications recommended by the Committee- he replied.
A committee packed with members of the ruling party
Following an inquiry by the opposition MPs, the government finally revealed a list of the committee members. The list included:
1) Representatives of the Prime Minister’s Office:
Krzysztof Kubów – PiS MP, Secretary of State, Head of the Prime Minister’s Political Office;
Izabela Antos – Head of the Developmental Services Department, member of the Unipetrol Supervisory Board;
Krzysztof Michalski – Deputy Director of the Prime Minister’s Office
2) Representatives of the Minister in charge of economic affairs:
Iwona Michałek – PiS MP, Secretary of State;
Piotr Ziubroniewicz – Head of the Minister’s Office, member of the Agreement (Porozumienie) party
3) Representatives of the Minister in charge of public finances:
Piotr Patkowski – Undersecretary of State, Head Officer of Public Fiscal Discipline, ran for parliament in 2019;
Robert Banach – Legal Department Manager.
4) Representatives of the Minister in charge of regional development:
Waldemar Buda – PiS MP, Secretary of State;
Marta Leśniak – Deputy Director at the Department of Regional Operational Programmes.
Asked about the criteria for aid allocation, Mr. Wenderlich quoted an excerpt from the directive, indicating that the committee considered such factors as sustainable development principles, the level of complexity of a given investment, emission standards, the cost in relation to the local government's income, the number of people who would be positively affected by the investment, etc.
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