site.btaEconomy Minister Claims Repairs of Three Dams Involved Mismanagement, Overpricing

Sofia, June 14 (BTA) - Caretaker Economy Minister Kiril Petkov
told reporters on Monday he would seek an explanation from the
State Consolidation Company (SCC) why three dams were still not
in operation six months after repairs. He talked of
mismanagement and inflated prices after inspecting three of the
ten dams whose repairs have been completed.

During an inspection, Petkov found that the dams - Pazar Dere in
 Lovech Region (Northern Bulgaria) and Zlati Voivoda 3 and 4,
both in Sliven Region (Southeastern Bulgaria) - were empty and
overgrown with grass. The Montagi EAD state-owned company
transferred them to SCC at the end of 2020, which was supposed
to turn them over to the State Dam Management and Stewardship
Company. It was set up in 2019 as the owner responsible for the
management, security and minor maintenance of potentially
dangerous dams, while SCC is responsible for repairs.

Although the repairs of the three dams have been completed and
paid for, they cannot be filled with water and used for
irrigation and other purposes since the protocols of delivery
have not been completed, said Petkov, adding that this is an
instance of mismanagement.

Taking a question, the Economy Minister said that since the
State Dam Management and Stewardship Company cannot use the
reservoirs, their sluices had to be opened after each heavy
rainfall because the dams are still considered to be under
repairs and cannot be filled with water.

Regarding Montagi EAD, Petkov said between six and eight
companies hold over 82 per cent of the contracts for repairs of
more than 100 dams.

More than 400 small dams are due for repair since the Boyko
Borissov government considered them a risk to the population
after heavy floods in 2018. At the time, the government
allocated 500 million leva to the Economy Ministry for dam
repairs. SCC's capital was increased by that amount, and the
company signed with its subsidiary Montagi at least 266
contracts worth 631 million leva, with the remaining 130 million
 leva borrowed from the Bulgarian Development Bank. Montagi made
 advance payments of several million leva each to subcontractors
 through a new company, Montagi Sofia.

Petkov said on Saturday that in 2018 Montagi had outstanding
debts to the National Revenue Agency and creditors, and while
its accounts were frozen, it made payments through its
subsidiary, which he called unacceptable, given the large volume
 of construction work.

Costly repairs
    
Furthermore, the Economy Minister will ask the Public Financial
Inspection Agency to look into overpricing of materials and
construction. All three dams were repaired by the same company
at what he said were inflated price. A cubic metre of concrete
cost between 214 and 219 leva, double the market price, and at
1.16 leva per tonne-kilometre, soil transport costs were five
times the market price, he said.
     
The repairs cost about 5 million leva: 2,350,000 leva for the
Pazar Dere Dam, 1,913,000 leva for Zlati Voivoda 3 and 547,000
leva for Zlati Voivoda 4.

The state-owned companies have their managing and supervisory
boards, which cannot be dismissed before a competition for new
members is held, Petkov said on Monday, and pledged that the
caretaker government would work every day to make those changes.

Inspecting the Pazar Dere Dam, Petkov Saturday posted a video
which showed a plastic bottle attached to the water level
gauging equipment. He commented: "I expect the equipment to look
 better than this when the State spends over 2 million leva."

Petkov's predecessor, Lachezar Borisov, who also visited the
site, called those claims "a grave manipulation of the public"
in the run-up to the July 11 parliamentary elections. He said
the dam had been designated dangerous in 2013 because it
inundated the road between Sofia and Varna. He claimed the water
 had been drained shortly before Petkov's inspection since the
dam was full on May 31. The former economy minister also said at
 least 600 companies were involved, not six as Petkov claimed,
and that the price of concrete included its transport and
placing.

Acting on its own initiative, the Supreme Cassation Prosecution
Office Monday asked the Economy Minister to make available the
information on dam repairs financed by SCC. RI/DD