Interview with David Smith,

Programme Manager

27^th of October 2005
“Pari” /”Money”/ Daily Newspaper
Journalist: Andrey Asparuhov

David Smith is the Manager of the Crown Agents Customs Programme in Bulgaria.  He was a customs officer in the UK for over 10 years, before working for the European Commission and for Eurocustoms on customs strategies and specific projects, primarily in countries preparing for EU accession.

Mr. Smith, how do you evaluate the results of the project of Crown Agents for the Bulgarian customs?

Crown Agents is extremely proud of the programme in Bulgaria and the results we have achieved.  The 100% uplift in revenue is a magnificent achievement for the BCA and we are very happy to have contributed to that result.

How did Crown Agents contribute to the increase of the profits of the customs?

The rise in customs revenue since our programme began in 2002 has been dramatic.  There are of course a number of factors involved and we are currently examining the macro economic environment to see how a number of external factors have impacted on revenue.  However it is evident that some external factors (customs duty levels and exchange rates for instance), can actually have a downward pressure on revenue.  In my view the biggest single cause of the revenue uplift has been the increase in compliance by traders.  This means the declaration of more realistic valuations on their goods and the declaration of  accurate classifications.  The overnight18% increase in revenue when the mobile teams became operational is a testament of this. 
Also, when we talk about increased trade volumes, this can be both a real increase (which has undoubtedly occurred) but it can also be the consequence of increase compliance as I have said, and this leads to greater declared volumes and values.

Bulgarian customs are to take over excise administration. How will you contribute to this process?

CA already has teams working on the control of primary risk goods, which includes such things as tobacco and alcohol.  With EU accession approaching, the Bulgarian Government is obliged to continue to increase excise rates to achieve closer harmonisation with EU averages.  This will put even greater pressure on the regulatory agencies to control the regimes, including in terms of duty free shops.

Would you use what you have achieved here as a successful model that could be implemented in other countries?

Every country is different and has its own issues and concerns.  It would therefore be wrong to say that you can simply lift one successful ‘product’ and ‘insert’ it, unchanged, somewhere else.  However I believe we have achieved something in Bulgaria which is unique and which can serve as a base model for other programmes elsewhere, particularly in a pre-accession environment.

Is your Bulgarian experience a reason for Romania to get interested in your services?

That is a question you will have to address to the Romanians.  However, there is no doubt that the results achieved in Bulgaria have received widespread international attention and generated much interest, in a number of other countries

Your contract in Bulgaria expires at the end of year 2006. What is the possibility for it to be extended?

This is a matter for the Bulgarian Government.  Our current contract ends at the end of 2006 and we all hope that Bulgaria’s accession to the EU will take place at the beginning of 2007.  As I said before, achieving the requirements for succession is the current aim but is not the end of the story, just of a chapter.  The period immediately after accession will be a new challenge and Crown Agents would of course be very happy to assist the Government of Bulgaria in any way it can.

How would you comment the practice of appointment of a new director of Customs Agency in Bulgaria after each change of ruling government?

Crown Agents has been very happy to work with the current senior management of the BCA, which has been in place since early 2002.  That is approximately 3 and a half years and I believe that the stability this has brought to customs has been of great benefit. However the appointment of any senior management posts within the BCA is entirely a matter for the Government of Bulgaria.

What will be the impact on Bulgarian customs of the murder of a senior customs officer and the revealation of his/her liaisons with underworld bosses?

The killing of any customs officer is a dreadful thing and Crown Agents extends its condolences to the family of Mrs Shinka Manova. From the BCA’s perspective, the important thing is to demonstrate its determination not to let such events deflect it from its tasks and responsibilities. Any other matters relating to the killing itself are subject to investigation and it would be entirely wrong for Crown Agents to comment.

Will you be worried about the outer borders of the European Union after 2007 when Bulgaria is expected to become EU member?

As citizens of the European Union we should all be constantly concerned about our external borders, whether in relation to the security and safety of our citizens, or in terms of the effective functioning of our internal free market.  The EU has been an evolving body ever since the first wave of enlargement in 1973 and the accession of Bulgaria is the next stage in that process. As always, this brings risks as well as benefits but I am confident that Bulgaria will, with the support of its EU partners, undertake its duties in respect of the external borders with professionalism.

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We Introduced a System for Decreasing Corruption

“Corruption is a notoriously difficult thing to measure.  As with the impact on customs revenue, which I believe has primarily been driven by a greater level of compliance by the trade, I similarly believe that there has been a direct impact on ‘compliance’ by BCA staff.  There is therefore a direct impact on existing levels of corruption as a result of this.  In addition, we have introduced a number of new systems and procedures which have reduced the opportunity for corruption to take place.  We have also developed and supported the internal audit function within the BCA which allows a range of audits to detect weaknesses in systems and procedures and identify systemic corruption. 
Corruption can never be completely eliminated.  No one would pretend that thebattle has been won and certainly we can never relax in our efforts to reduce and controls corruption levels within the BCA.  However I do believe that the BCA has made significant progress and there is a determination within the senior management of the BCA and within the Bulgarian Government to continue to address this problem at all levels.”