The European Commission approved the National Recovery Plan (NRP) for the Czech Republic on 19 July 2021. The Czech Republic has been allocated a total of CZK 180bn from European resources for the period of 2021 – 2026. 

The National Recovery Plan is divided into 6 main pillars of support:

• Digital transformation
• Education and the labour market
• Physical infrastructure and green transition
• Institutions, regulation and support of business in reaction to the COVID
• Research, development and innovations
• Health and resilience of the population

On 31 March 2022, an inventory of NRP goals and readiness was conducted, and the Ministry of Industry and Trade (MoIT) assessed all 244 goals. The results were then divided into 3 groups:

1.    group – represents 63% of the milestones and targets from the NRP, which the MoIT expects to meet as planned and where no changes or adjustments are required.

2.    group – 21% of milestones and targets, requires additional funding from the state budget, either to meet pre-set targets or to cover additional costs (e.g. VAT, inflation).

3.    group – 16% of the milestones and targets, defined the requirements for changes to the plan and therefore also the time, conditions, text modifications and additional funding, possibly a combination of all.

“Last year, just before the election, the previous government outlined the National Recovery Plan to make it look as good as possible on paper for its voters. In reality, however, it was built on feet of clay and because of this, it is now in very serious danger of collapsing and of no one getting anything out of it.” says Minister of Industry and Trade Jozef Síkela, adding that the implementation of the NRP must not stop, even if its implementation is problematic.

For the 1st payment request of EUR 1,066,888,563, scheduled for summer 2022, the following components are most at risk:

• Component: 1.2: Digital public administration systems, Investment no. 4: Creating the prerequisites for digital justice, this is an Analysis mapping the data use and data management needs of the judiciary and the Ministry of Justice to serve as a basis for the preparation of future projects aimed at the digitization of this sector. It includes the implementation of a data warehouse for the Department of Justice.
• Component: 2.6: Protection of nature and adaptation to climate change Investment no. 1: Flood protection, specifically the approval of 40 projects related to flood protection under the responsibility of the Ministry of Agriculture.  Full compliance with the requirements of the Water Framework Directive will be ensured and demonstrated for recommended projects prior to the commencement of construction works.  

An equally serious problem is the fact that not all ministries have a designated person responsible for NRP implementation for that ministry. The request, which was approved by the new Cabinet at the end of March, came from the Ministry of Industry and Trade, which is in charge of managing and coordinating the recovery plan. Petra Hrušová from the press department of the Ministry of Culture said that the MoIT expects information about the responsible person by 30 April.

The announcement of calls from the NRP is getting significantly delayed, which in a situation of uncertainty and high inflation in combination with a shorter time for the implementation of project plans may further complicate the implementation of the set objectives. Uncertainty and poor information create reluctance in the business sector to implement already prepared project plans. If the timetable for announcing calls and its compliance is not changed in the near future, the drawdown of a large part of the NRP will be at risk.

Grant Thornton Advisory applies a complex and systemic approach in the area of subsidy consulting. We deal with management of the project portfolio from the perspective of possible subsidy opportunities.

Subsidy analysis

At the beginning, there is always a thorough subsidy screening, which will compare the portfolio of the client’s possible projects with the current as well as the expected options for financing. The analysis focuses on Czech as well as European subsidy programmes, as well as on other types of financing (such as for example loans). The analysis is addressed with an agile attitude, with workshops with the client being organised in the meantime, where the options and possible alternatives for how to approach the projects are discussed.

Consultation and monitoring

The subsidy analysis will specify potential projects, priorities and action steps. Subsequent consultations and monitoring according to the specified action steps will be resolved operatively by means of monthly reports according to the needs and schedule of the projects and the subsidy calls.

Submitting an application

At the time of the decision to submit applications for the given project, we will provide complete preparation of the application including supplements, communication with the provider and we will define the necessary cooperation on the part of the client (such as for example the preparation of project documentation, permits, energy assessments etc.)

Subsidy administration

In case of a successful application, we also offer services of subsidy administration in the course of the project. Preparation of requests for change, requests for payment, reports on realisation, communication with the provider, and after the completion of the project reports on maintainability as well.

All supported projects must also be addressed from a public procurement perspective. In case of need, it is possible to arrange support in this area as well.

In case you are interested in subsidies or preparing and submitting project applications, we are at your service. Please, contact Jiří Dvořák, Senior Manager | Advisory, Infrastructure, jiri.dvorak@cz.gt.com.

Author: Jiří Dvořák, Libor Kaňák