Crown Agents submitted to the Minister of Finance the Final Report on the Programme for Modernisation of Bulgarian Financial Administration, which ended at the end of June 2010. The report contains a summary of all of Crown Agents’ activities under the programme including  332 recommendations for improvement.  They have been submitted continuously as the programme has progressed and implementation will provide opportunities for further benefits to Bulgaria beyond the duration of the consultancy contract.  Approximately two thirds of the recommendations submitted are at various stages of implementation by the responsible Agency and their full effect is not felt yet.

“It has been a privilege for us to work with so many professional people in Bulgaria over the last eight or more years. Some changes have been much easier to introduce than others, some have an immediate effect but for others it will need much more time for the impact to be felt.”, said Vivienne Davies, Crown Agents’ Director “Customs and Trade Facilitation”.

Programme Manager, David Smith, believes the results of Crown Agents’ work in Bulgaria, both in terms of revenue collection and modernisation of the financial administration, have a direct and positive impact on people, businesses and the economy.

“The benefits from our joint activities with the Ministries of Finance and Interior will continue to be felt by the State in terms of improved revenue generation and sustainable reform of working systems and procedures.”, said Crown Agents’ Team Leader in Bulgaria, John Brown.

The Programme for Modernisation of Bulgarian Financial Administration began in June 2007, following a six-month gap after the end of the previous Crown Agents Customs project.  The Programme was significantly smaller  but its scope of activities was substantially widened to include all aspects of state revenue enhancement.  Crown Agents’ advisors supported a wider range of agencies that are responsible, directly or indirectly, for protecting revenue and preventing frauds. These included the National Revenue Agency (NRA), the National Customs Agency (NCA), other Single Level Spending Units under the responsibility of the Ministry of Finance and the State Agency for National Security (SANS).

At the request of the Minister of Finance at the time, Crown Agents’ role became much less operational and more strategic, focused on developing the operational capacity of the agencies through the provision of advice and training.

Notes to editors:

1. Crown Agents made a large number of analyses and assessments of legislation and working practices. The advisors’ reports covered the VAT Registration System, VAT Fraud Detection, Development of the NRA Risk Management Approach, Enhancement of information exchange, NCA Modernisation, Mobile Assurance Team  (MAT) Training and Development, Excise Control and Use of IT Systems to Prevent Corruption and Crime.

2. The analyses resulted in a significant number of recommendations for improvement and specialised trainings, based on the needs identified. Crown Agents then organised a series of training events, which were aimed at enhancing the capacity of state administration to protect revenue and combat frauds. Training was delivered to over 700 staff in the revenue agencies and other enforcement bodies, including SANS and the Ministry of Interior. Among the major areas covered were improving the use of risk analysis in identifying and targeting revenue threats, systems based audit in Customs post clearance control, rummage techniques and money laundering awareness.

3. Crown Agents has been instrumental in the creation and development of:

• A Fiscal Crime Coordination Group, aimed to encourage inter-agency cooperation in the sharing of knowledge and experience in relation to serious fiscal crime.

• A VAT Registration Unit to verify the intentions of companies applying for VAT registration and reduce the risk of phantom companies fraudulently reclaiming VAT

• Continued and improved training, mentoring and guidance to Mobile Assurance Team (MAT( managers and staff)
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• An Information Technology (IT) Security Policy for the Ministry of Finance, which will reduce the risk of fraud and corruption.

4. During the Programme for Modernisation of the Bulgarian Financial Administration Crown Agents’ role became much less operational and more strategic, focused on developing the operational capacity of the agencies through the provision of advice and training. It is therefore not appropriate to simply relate the activities under the Programme with overall levels of revenue collection during the period as a large number of the benefits will only materialise following the adoption and effective implementation of the recommendations made.

5. Although Crown Agents’ role under the current Programme was mainly strategic the advisors also supported the practical aspects of revenue collection through assistance in a number of operational exercises with the NRA and the NCA. Amongst these exercises were  the NRA Winter and Summer Tax Compliance Campaign in the major resorts, which proved to be crucial in increasing the levels of income declared by companies and consequently their tax liabilities. Crown Agents also supported various operations of the Customs MATs at the borders and exercises targeting specific high value excise goods such as oils, cigarettes and alcohol. As well as supporting the campaigns themselves, the advisors also reviewed their implementation on each occasion and provided specific recommendations for enhanced effectiveness in the future