National Audit Office carries out additional work for the audit ‘Activities of Government in Development of National Airlines’

Toomas Mattson | 2/11/2016 | 5:11 PM

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TALLINN, 11 February 2016 – The National Audit Office will be carrying out additional work in relation to the audit ‘Activities of Government in Development of National Airlines’ in the next few months. Completion of this work was initially planned for February. The additional work is necessary due to the facts that have emerged in the course of the audit.

The audit has revealed that some of the material that could be an important source of information when analysing the decisions made in the case of Estonian Air has not been stored in the expected place or it could so far not be found for reasons unknown to the National Audit Office. At this stage of the audit, the National Audit Office is not going to specify which material is missing and which of the officially missing material it managed to obtain via other channels. The fact that a lot of verbal communication and information exchange was used in issues concerning Estonian Air, which has left no trace, has complicated the audit.

As various written materials are incomplete and contradictions in existing information must be eliminated, it is necessary to conduct additional interviews with the persons concerned and carry out other work, which will take a couple of months.

 

Background

On 9 November 2015 Auditor General Alar Karis gave the order for the preparation of a special report of the National Audit Office to inform the Riigikogu and the general public about whether or not the Government has been diligent upon the establishment of the new Estonian airline and whether or not it has managed all of the risks as much as possible, as ignoring them may have played a part in the problems of Estonian Air and led to the decision that ca 85 million euros of the money spent to support the company was prohibited state aid.

The special report focuses on the decisions made by the Government before the establishment of the new airline in autumn 2015 and the quality of decision-making. As the new companies (OÜ Transpordi Varahaldus and AS Nordic Aviation Group) require big investments – ca 70 million euros – the National Audit Office will investigate whether the information on which the government’s decision is based allowed for making a wise and prudent decision, and that taking unjustified risks and non-compliance with the state aid regulations of the European Union was avoided.

The audit will also clarify how the Government made its decisions about Estonian Air since the acquisition of the majority holding in the airline in 2010 and whether any mistakes were made when the decisions were prepared. The National Audit Office will also analyse whether the negative state aid decision of the European Commission could have been prevented.

Toomas Mattson
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  • Posted: 2/11/2016 5:11 PM
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