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Despite initial opposition from international financial institutions, which called for a clear analysis of costs and benefits, the state institutions continued.
In 2015, concessions were granted for sterilization and check-ups. In 2016, dialysis was concessioned, and in 2019, laboratory services, all in the healthcare sector, Monitor reports.
In 2015, the practice of granting incinerator concessions began with Elbasan, which expanded to Fier in 2017 and Tirana in 2019.
In 2017, the maintenance of the Milot-Morinë road was concessioned, and in 2018, the Arber road was also concessioned.
The scanning concession was also revisited, which had been approved by the previous government in 2013 and to alleviate the burden on businesses, the government undertook to partially cover the cost through the budget.
All of the aforementioned concessions received direct payments from the state budget. The increase in these payments forced the government, under pressure from the IMF, to establish a fiscal rule whereby the total annual net payments made by general government units resulting from concession contracts or public-private partnerships (PPP) should not exceed 5 percent of the actual tax revenues for the upcoming budget year. In case of exceeding this limit, the Council of Ministers takes corrective measures in the revenue side of the budget, necessary and sufficient to return within the allowed limit during the next two budget years.
So far, the limit has never been exceeded, but the reality is showing that for the most part, these payments have been cost-inefficient, as a significant portion of the concessions are now under official investigation by SPAK, the special anti-corruption structure.
Data from the Ministry of Finance, for the actual budgets from 2017 to 2022, processed by Monitor, shows that over six years, the state budget paid a total of 58.5 billion lek (around 560 million euros) for 12 concessions: Arber Road; Scanning; sterilization; Laboratories; Tirana Incinerator; check-ups; Dialysis; Maintenance Milot-Morinë; Educational Infrastructure; Fier Incinerator; Orikum-Dukat; Elbasan Incinerator. The highest amount was allocated for the Arber road (12.9 billion lek), sterilization (9.4 billion lek), scanning (9.1 billion lek), and Tirana's incinerator (5.5 billion lek) – see the full table: Actual payments from the state budget for concessions 2017-2022.
Of these 12 concessions, five of them – three incinerators, check-ups, and sterilization – are under official investigation by SPAK for charges ranging from corruption, abuse of duty, to money laundering. The total amount allocated by the budget for these five concessions for the period 2017-2022 is 25.4 billion lek (around 240 million euros), accounting for 43% of the total payments made by the budget for all concessions!
Even the finance sector itself has expressed concern that concession contracts are not being controlled or monitored in line with legal obligations and agreements between the state and the private sector, which are mandatory instruments.
Payments and Investigations
In 2021-2022, investigations were launched for the incinerators in Fier and Elbasan. According to SPAK, the investigation has found numerous violations, starting from the procedures for concession grants and continuing with document falsifications of ownership, creation of fictitious companies, fictitious invoicing, and payments for work not performed. Fictitious payment schemes have been used to cover and hide the true nature of the illicit origin of monetary amounts and the true nature of their transfer and displacement.
The Elbasan incinerator received around 2.4 billion lek during the 2015-2021 period, which coincided with the concession term.
The Fier incinerator received around 4 billion lek during the 2015-2022 period.
At the beginning of August of this year, SPAK initiated an investigation into the Tirana incinerator. SPAK announced that it is investigating criminal offenses of "Serious Fraud," in collaboration, "Abuse of Office," "Passive Corruption by High State Officials or Elected Officials," and "Money Laundering of Criminal Products or Criminal Activities," committed in collaboration.
The Tirana incinerator received payments of 5.5 billion lek from the budget for 2019-2022, and according to the balance sheet, it has collected around 9.9 billion lek due to receiving payments from municipalities and for waste removal services.
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| Actual payment from the budget of the Albanian government 2017 - 2022, Source: Monitor |
In May 2022, SPAK initiated an investigation into the check-up concession. This concession received payments from the budget of around 4 billion lek for the period 2015-2024.
A day ago, SPAK issued 8 arrest warrants for former senior officials of the Ministry of Health for abuses of the sterilization concession. This concession has received payments of 9.4 billion ALL for the period 2015-2022.