Savić: NPOO is crucial for obtaining European funds, not the National Reform Program

Special advisor to the Prime Minister Zvonimir Savić emphasized on Monday that the European Commission does not consider the National Reform Program (NPR) as relevant for deciding how much European funding will be allocated to Croatia, but rather the National Recovery and Resilience Plan (NPOO) is crucial for that.

Savić referred to an article in today’s Jutarnji list which states that the Government has fulfilled only 15 out of 85 measures in the first half of the NPR’s implementation for this year. According to Jutarnji, the deadline for 16 measures has already passed or they have been postponed, the others are ongoing, and of those that are being implemented, most must be completed by the end of this year, leading to the conclusion that it is already clear that they will not be able to be completed on time.

The NPR for this year was adopted by the Government on April 27. It pertains to the period until the end of April next year and was adopted within the framework of the European semester, an instrument of fiscal oversight and coordination of economic policies of member states with the economic policy of the European Union, and as such, it was submitted to the European Commission.

The NPR is defined in such a way that measures from the NPOO are taken for a certain period, and measures that are primarily provided for in the budget are added. Thus, of the 85 measures, Jutarnji list notes that 56 are from the NPOO, based on which European funds are drawn.

Therefore, there is an “overlap” between the two documents, but Savić claims that there are no delays in the measures related to the NPOO, which is crucial for obtaining European funds and where the Commission checks whether a certain number of reforms and investments have been completed on time.

The Government is ‘100 percent fulfilling‘ the NPOO, Savić states. In other words, since the beginning of the implementation of the NPOO, it has fulfilled all planned reforms and investments so far, totaling 104.

Savić notes that the text in Jutarnji list was written based on the semi-annual report on the NPR, which pertains to the period from May to the end of October this year, stating that each reform has its own dynamics, and that the six-month period is merely a “transitional time,” while the deadline for fulfilling the 85 reforms is the end of April next year.

– There are no consequences because the deadline for fulfilling all 85 measures is the end of April next year. It may happen that something is delayed considering the dynamics we have predicted, and there are nine such measures, but they will be implemented because the final deadline for the entire document is the end of April 2024. By then, the plan is to fulfill everything – Savić stated for Hina, emphasizing that the Commission does not allocate European funds based on the NPR.

Upcoming payment of the third tranche from the NPOO

The Government submitted a request to the Commission for the payment of the third installment from the NPOO on July 24 of this year, and Savić expects the payment of those 700 million euros “very soon.” Croatia has so far received more than 2.2 billion euros from the NPOO, which is more than 40 percent of the total available 5.5 billion euros in non-repayable funds, and Savić emphasizes that it is among the most successful EU members in implementing the NPOO, thus it will be the third to receive the third installment.

Regarding the mentioned 56 measures, Savić notes that some relate to fulfilling conditions for the payment of the third tranche, some to the fourth, some to the fifth, and some to the sixth tranche.

He explains that all projects in the NPOO are proceeding according to the agreed dynamics, where the Commission needs to document and prove that everything planned has been completed, and this entire procedure and verification on their part takes several months.

For example, reforms and investments that are prerequisites for the payment of the fifth tranche must be completed by the end of this year, while those related to the sixth tranche, which are also among the mentioned 56 measures, have a deadline for completion in the first half of next year.

Postponements in agreement with the Commission

Explaining certain postponements, Savić emphasizes that they have been agreed upon with the Commission. ‘We cannot unilaterally say that we will postpone something. There is fundamentally no problem here,’ he states.

As an example, he took the project of operating rooms in Firule and Križine in Split, where a robotic system was supposed to be installed by the end of the year. Due to “objective difficulties” related to the supplier and infrastructure, the project has been postponed for six months, and a similar postponement of deadlines, also agreed with the Commission, related to the recently mentioned project of Rimac’s robotaxis.

Furthermore, Savić states that Jutarnji list writes that the works in water supply are progressing slowly, considering that by the end of the year at least 673 kilometers of public water supply network should be built or renovated, and so far just under 400 kilometers have been completed.

However, Savić emphasizes that the deadline is the end of the year, so it has not passed, asserting that this indicator will be fulfilled, meaning that the planned work will be completed. He adds that this involves many projects across Croatia, and that Hrvatske vode has previously fulfilled similar indicators within the NPOO.