SUMMARY of Annual Report on implementation of the Operational programme, Infrastructure
and services’’ in 2014
Annual Report on implementation of the EU funds in the 2007-2013 planning period in Operational
programme ”Infrastructure and services” (OP) (ID No 2007LV161PO002) for year 2014 is prepared
according to the Art.67 of Council Regulation (EC) No 1083/20061 and the Annex XVIII of Commission
Regulation (EC) No 1828/2006 of 8 December 2006.
The progress in achieving the main objectives of the OP is highlighted in the report - to support investments
in improvement of the availability of public infrastructure and quality of services in Latvian economy by
co-financing investments in transport, environment, energy, information and technology (ICT), culture and
tourism sectors, energy efficiency of housing, urban development, modernisation of the infrastructure for
education and other improvements regarding availability of public services and infrastructure to remove or
decrease obstacles which substantially interfere with achievement of the aims of both EU and Latvia
concerning regional development.
EU funds are the most substantial public investments in Latvia and has greatly contributed to the country's
economic growth. EU funds impact assessment analysis shows that without EU funds contribution, GDP
growth in 2014 would have been approximately 0,9% lower.
Overall Latvia has managed to ensure successful implementation of the EU funds, including measures taken
to promote the use of EU funds to the full extent, conceptually assigning state budget overcommitments
within the OP of 185,9 million Euro.
In general the level of implementation of the OP in 2014 can be evaluated as positive, considering the
fact that closure of planning period of 2007-2013 is nearing. Year 2014, compared to 2013, has seen a little
increase in contracted and approved projects – up to 2014, projects have been approved for total of 3,3Bn
euro or 101,8% (annual decrease – 0,01% mostly due to fact that some projects have been transferred from
OP ”Infrastructure and services” to OP "Entrepreneurship and Innovations"), projects have been contracted
for total of 3,3Bn euro reaching 101,8% (annual increase 6%) of EU co-financing. Amount of contracted
and approved projects exceeds 100%, because there are overcommitments within the OP funded from state
budget. Payments made to final beneficiaries (including advanced payments) reach 2,6Bn euro (annual
increase 14,6%) or 81,2% of EU co-financing.
Despite some of the factors hindering the implementation of EU funds in 2014, that don’t differ from those
in previous years - procurement problems, economic external factors, project cost increases, as well as
terminated contracts for various reasons, the managing authority shall determine the use of EU co-financing
in full at the expense of overcommitments.
It can be concluded, that the national absorption targets have provided a guaranteed achievement of
the n +3 / n +2 goal in 2014. Within CF there was a risk of not fulfilling the N+2 plan for 2014, but
necessary measures for the prevention of risks have been timed well. In 2015 managing authority will
reinforce the EU fund project, in particular major project, supervision in order to ensure a full use of EU
co-financing as well as benefits from priority rates.
During 2014 there has been a significant increase in number of completed projects, within OP up to 2014
in terms of number more than half of projects or 65,8% have been completed (2 088 projects from total of
3 171 contracted). On the other hand, in terms of the proportion of the project financing, amount of
completed projects is relatively small, within OP 38,6% projects are completed (1 279,1 mil euro) from the
contracted projects of EU co-financing and 61,4% are still in the implementation stage, which means that
the most expensive projects are still being implemented. The largest proportion of the number of completed
1
Council Regulation (EC) No 1083/2006 of 11 July 2006 laying down general provisions on the European Regional
Development Fund, the European Social Fund and the Cohesion Fund and repealing Regulation (EC) No 1260/1999.
projects – 78,2% is in 3.1. priority "Infrastructure for Strengthening Human Capital", however the largest
proportion of projects completed in the amount of the financial contribution is in priority 3.5., where 60,7%
projects are completed from contracted EU co-financing.
NSRF strategic targets are reached gradually, EU funding is one of the main sources of investment in the
economy, contributing to its development, but reaching of the set targets are mostly impacted by socioeconomic situation. Achievement progress can be observed of almost all core indicators. It is forecasted
that planned values of core indicators will be reached and exceeded by the end of 2015. OP impact
indicators implementation has been rated as positive. It is forecasted that by the end of 2015 most of the
indicators will reach their planned values with some exceeding them. For indicators reported in 2013, the
most significant deviations from OP output and result indicators that not changed much in 2014. In
priority 3.1. "Infrastructure for Strengthening Human Capital" education field the improvements will not
be made to educational institutions, as originally planned, moreover, in the area of the labour market,
investments in infrastructure will be smaller than planned within OP, mostly because the reorganisation of
institutions. However, in 2014 the most notable indicator progress can be observed in transport sector, in
terms of total length roads paved and reconstructed indicator is exceeded (up to 31.12.2014. first grade
roads have been paved for total of 394,43 km (in 2014 – 82,1 km) or 119,5% from the planned and
reconstructed transit roads 68,65 km (in 2014 - 20,89 km) or 343,3% from planned, moreover, TEN motor
road have been built and reconstructed for total of 345,56 km (in 2014 – 157,46 km) or 612,7% of target
value (56,4 km). In transport sector indicators exceed their target values mostly due to planned cost
reductions and additionally allocated funding. Indicators are exceeded in health sector, ICT, water
management and policentric development sectors.
Some of the major project implementation rates are lagging from the planned mostly due to the objective
reasons. For this reason several of major project deadlines have been extended, including changes in
implementation contracts. In two projects risks have been identified relating to reaching target of result and
output indicators, therefore project EC decision amendments are taking place. Additionally, two major
project applications are being prepared for projects which qualify as major projects. Two of them will be
classified as not functional.
In 2014 managing authority has taken a number of substantial steps in order to improve EU funds
management and control system – strengthened methodological support for EU fund supervising
institutions, during the reporting period, a number of methodological and explanatory materials have been
improved for these institutions, moreover, strengthened cooperation with law enforcement authorities,
enhanced control mechanism of managing authorities over the general supervision carried out by the
managing authority delegated functions.
Main tasks for 2015:
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implementation of financial discipline measures for the promotion of financial targets;
EU fund implementation, in particular the financing granted by the Cohesion Fund, monitoring,
including enhanced monitoring of the implementation of major projects;
two major project application and EC decision amendment preparation and submission to EC;
preparing for closure of planning period 2007-2013;
establishing a system for planning period 2014-2020.