National Audit Office: the South-Estonian hazardous waste collection centre was not established in the most cost-effective way for the state

Toomas Mattson | 2/8/2007 | 12:00 AM

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TALLINN, 8 February 2007 - In the course of the audit the NAO found that the South-Estonian hazardous waste collection centre whose cost amounted to EEK 23.2 million, was not established in the best suitable way and conditions for the state. The collection centre was constructed on the registered immovable of AS Epler&Lorenz, the largest handler of hazardous waste in South Estonia. The Minister of the Environment did not concur with any of the NAO’s assessments and finds that the construction of South-Estonian hazardous waste collection centre is a well-considered decision from all perspectives that was carried out in the best suitable way and in conditions favourable for the state.

According to the Ministry of the Environment, the collection centre shall be used by AS Epler&Lorenz pursuant to a rental contract concluded as a result of a competition. Additionally, in the next ten years the state shall pay over two million kroons to the public limited company for the right of superficies.

The analysis of the NAO shows that even though the Ministry organised a competition to find an operator for the centre, its criteria were such that only one applicant - AS Epler&Lorenz - met the rental conditions. This company turned out to be the only one to submit a tender, although the number of persons requesting the competition’s documentation was larger.

The audit revealed that the collection centre could have been established in a significantly more favourable manner. In 2002, AS Epler&Lorenz itself wished to construct the collection centre, applying to the Environmental Investment Centre (EIC) for a support of EEK 7.7 million. Unfortunately, the EIC did not consider the company’s request to be reasoned.

In 2005, the Ministry of the Environment began constructing a state-owned hazardous waste collection centre on the registered immovable of AS Epler&Lorenz, receiving a support of EEK 7 million from the EIC for that purpose. The documents analysed in the course of the audit did not show that the Ministry of the Environment had thoroughly considered other options for establishing a hazardous waste collection centre, e.g. constructing a centre on state land or finding an undertaking to construct the centre.

The NAO found that the conditions of the contract of superficies concluded for the use of the registered immovable of AS Epler&Lorenz are unfavourable for the state in terms of the payment and deadline for the right of superficies. Also, the benefit paid to the state upon the termination of the contract of superficies is less than the actual value of the collection centre.

The NAO is of the opinion that the collection centre that was completed last year can not fulfil all duties imposed on it. During the establishment of the centre, the storage lots with a lightweight roof were not built, though it was required by the environmental impact assessment report, and no laboratory equipment necessary for the determination of the characteristics of hazardous waste was obtained. Therefore, the storage of hazardous waste has not been ensured in a way that would eliminate threat to the environment, the building and the people working there.

Analysing the viewpoints presented in the official reply and the discussion in the Committee on the Control of State Budget with the participation of the Minister of the Environment and the Ministry’s officials, the NAO does not find it justified to change the observations given in the report.

Toomas Mattson
Communication Manager of National Audit Office
Telephone: 6400 777
Mob: 51 34900
E-mail: toomas.mattson@riigikontroll.ee

  • Posted: 2/8/2007 12:00 AM
  • Last Update: 9/15/2015 1:46 PM
  • Last Review: 9/15/2015 1:46 PM

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