MPs to Trace Tracks of Contracts with BULL Company

The contract signed with the approval of Bulgaria’s former Finance Minister Milen Velchev for the development of information system for managing the revenues of the National Revenue Agency (NRA) will be among the major motives for the opposition to launch investigation against the body’s ex-head Maria Murgina, who resigned end last week, opposition MPs preparing the motives for the seventh non-confidence vote against the cabinet to be filed on February 18 told Bulgaria News on February 17, 2009.

The opposition forces want to see the contract signed by Velchev as they are sure it is the reason for the delay in the system’s launching. The former finance minister in the government of Simeon Saxe-Coburg-Gotha has not made a statement over the document yet. An answering machine answered his cell phone when Bulgaria News tried to get in touch with him.

The information system of the NRA was to start in January 2007 but was put off by few months just to “vanish” later. As a result, nobody can now tell when it would be officially launched. And the system itself is highly needed for the process of coordination of the agency’s activities with those performed by the National Social Security Institute and the Health Insurance Fund.

The authors of the seventh non-confidence vote required access to the contract with the BULL Company as they think it is
non-profitable and does not defend the interests of the state.
The details of the contract have not been clarified yet, as well as the forfeits BULL owes to the state due to the delay, when the saga will end, or what defaults the state should pay in case it terminates the contract. While still Executive Director of the National Revenue Agency, Maria Murgina confessed the delay caused serious problems and she would insist on getting all the forfeits “Bulgaria had to get over the contract signed.”

That is the real enigma in this case, as nobody has ever seen the documents concerned except for some senior administration employees of the previous and the current governments and Murgina herself. Despite she has threatened to seek Bulgaria’s rights in case of delay or performance failure, the National Revenue Agency has no revenue management information system yet and this is quite likely to continue for some time ahead.          
 
As Bulgaria News has already informed, ex-Deputy Finance Minister Georgi Kadiev voiced one of the strongest official accusations against Murgina is based on the launching of the malfunctioning revenue management system purchased from Botswana and on the waste of money allocated for Bulgarian experts’ training in the African country.

The software of the system has been developed by BULL’s branch in South Africa (which hardly could be classified as important information) and has previously been used only by several African states. The most peculiar fact in the story is that NRA’s employees have often been sent to Botswana in recent years to exchange experience and training skills. Obviously, that has not worked, given the system in Bulgaria remains non-functioning.

It is a fact that the lack of good software and good coordination between the institutions has caused serious problems in the National Social Security Institute. It has continuously insisted on adapting the system as the data about insured citizens and companies was not adequate. The intelligent services have found numerous errors in that data – between 500,000 and one million. It happens like that – a citizen or a company pays what they owe, the payments are loaded into the system but the further archiving turns out to be mistaken. After a second check-up of the system, it shows that the person or the firm in question owes taxes. Similar mistakes appeared in the data about income taxes paid, VAT, and insurances, employees of the Revenue Agency said, cited by Standart Daily.

But the National Social Security Institute is not the only victim of the lack of coordination. In start-2006 then Health Minister Radoslav
Gaydarski was cross-fired at a National Assembly hearing,
after he signed another contract with BULL (though in a consortium with two other firms –Romania’s “Siveko” and Israel’s “Makabi”) for the development of a incomes information system for the National Health Insurance Fund. Opposition MP Maria Cappone attacked Gaydarski claiming he had signed the document though being aware of the ongoing conflict between the taxation authority and BULL.
Gaydarski then emphasized on the good implementation of the IT product in Romania. Moreover, the former minister said the problem between the Revenue Agency and BULL was the Bulgarian body itself as it failed to precisely define the parameters for the system’s development, which urged introducing some changes afterwards which caused the huge delay in its launching.

Current Healthcare Minister Evgeniy Zhelev found the system in the stage it was so far developed but he has also suffered because of the poor work done.
According to an official statement of the National Healthcare Insurance Fund in start-December 2008, “the integrated info system of the fund has been completed and will start functioning as of January 1, 2009. So far (February 17, 2009)
the system still does not operate.     

Not only the Health Ministry but the National Revenue Agency too, is to blame for the delay. It turned out that the submission of data from the Healthcare Insurance Fund to the Revenue Agency would be pointless, as the agency’s system does not work. The fund has a good enough internal system so that it could control its own incomes and expenses,yet

sharing information with the Revenue Agency is impossible.

The project for developing an information system for the Health Insurance Fund aims at the integration of two related components – the systems for planning and allocation of financial resources and management of requests for payment of medical and pharmaceutical services provided across Bulgaria. The two components are backed by various applications, including activities for internal financial control, medical audit, complaints’ administration, etc.

The information system of the National Healthare Insurance Fund was developed for about two years, which resembles an Olympic Games record in comparison to case with the NRA. But that achievement has also proved that France’s BULL is probably not to blame for the lack of the Revenue Agency’s system and that its employees are likely to be accused over the delay in its development. The investigation services and the Prosecutor’s Office are yet to conclude whether the failure occurred due to objective factors or the delay was intended to protect the schemes for VAT draining (the widely commented reason for Maria Murgina’s resignation).

There is no reason to doubt the statement of former Healthcare Minister Radoslav Gaydarski, who claimed the completion of the contract between the Revenue Agency and BULL is a complex problem caused by the difficulties of implementing new practices within the Revenue Agency. “At first, NRA has defined 16 parameters for the system, then they were brought to 30, 54 and, finally – 60. You should ask the people working there - they claim not only BULL but they themselves are to blame for the current situation”, Gaydarski explained in an answer to a Maria Cappone’s question asked in 2006.

According to investigators, cited by mediapool.bg on February 17, the software for incomes management in the National Revenue Agency has been bought without an option to be adapted and the revenue control system has not functioned, which eased the VAT draining process. According to documents cited by the website, the software’s initial value was set at USD 1.5 million, but more than EUR 4 million was spent for it so far, although it was introduced in less than half of the Revenue Agency structures.

A hope emerged that after Bulgaria’s accession to the EU the system development would accelerate. But it proved to be in vain, just like many other hopes Bulgaria’s citizens kept even though they are now called “EU citizens.”