KredEx: The audit of the National Audit Office ignores important facts


Today, the National Audit Office disclosed an audit assessing the bases and processes of the crisis measures provided by KredEx. Although the audit, among other things, includes constructive feedback, several important facts have been overlooked according to the head of KredEx.

Ivo Kuldmäe
Ivo Kuldmäe

Chairman of the Management Board at KredEx Ivo Kuldmäe says that there are unsubstantiated allegations in the audit and at times the audit even contradicts itself. ‘In its assessment, the National Audit Office has highlighted that the implementation of measures has not been sufficiently quick and effective, while saying that speed and maximum distribution of funds cannot be goals in themselves. Such conclusions are confusing and incomprehensible. At the beginning of the crisis, speed was important, and we acted accordingly. To date, we have made 442 million euros available to entrepreneurs,’ Kuldmäe said.

‘The National Audit Office states that there is a need to monitor the market more and listen to entrepreneurs. Since the first days of March, KredEx has been co-operating consistently and substantially with all major umbrella and support organisations in the field of business, and we also have regular meetings with the Estonian Banking Association, we have had a dialogue with Eesti Pank and taken into account the feedback received from entrepreneurs, both at the level of individual contacts and organisations,’ the head of KredEx brought another examples.

‘It is also contradictory to claim that the current measures have not been used, but in the future the focus should be on sureties, which banks and entrepreneurs have not requested to the extent expected so far. Furthermore, the claim that emergency services do not have a clear purpose is not true. When we focus on the fact that the European Union’s temporary state aid framework has set the goal of helping entrepreneurs alleviate liquidity problems, we can say that we have performed well in that sense,’ Kuldmäe argued.

According to him, it is arbitrary to state that entrepreneurs were not properly informed of the change in the terms of the measure. ‘We have organised more than 20 webinars, carried out regular media coverage, conducted several digital campaigns to promote the measures, shared information through the channels of business-related organisations and much more.’

According to Kuldmäe, the National Audit Office has overlooked the most important fact when assessing the national significance of loan projects worth more than 10 million euros. ‘Whether the project is nationally important is decided by the Government of the Republic, not KredEx. Therefore, it remains unclear why the National Audit Office criticises KredEx for its substantive compliance.’

However, Kuldmäe stresses that there is a lot of constructive feedback in the audit, which will definitely be taken into account when planning further steps. ‘We fully agree with the proposal of the National Audit Office that regularity and a holistic view must be a priority in the further development of the crisis measures. The state must also set clearer goals and co-operation with KredEx is important in achieving this.’  

According to Minister of Foreign Trade and Information Technology Raul Siem, the audit is a necessary feedback mechanism from the point of view of adjusting measures and confirms the vital important role of KredEx in assisting businesses affected by the crisis.

Minister Siem noted that since the beginning of the crisis, the contribution of KredEx to supporting entrepreneurship has significantly increased and the need of entrepreneurs for financial aid is likely to grow. Siem added that the main goal of the crisis measures of KredEx in spring was speed in order to provide immediate relief to the liquidity problems of as many businesses as possible. ‘Since March, KredEx has been re-structuring its services, creating new products for narrower target groups, and making conditions more favourable for entrepreneurs, which has also accelerated the flow of funds to applicants. It must be noted that the crisis came unexpectedly for everyone, that events in the crisis are happening quickly, and that the needs of the market are constantly changing. It is only natural that in such circumstances, the continuous adjustment of financial instruments takes some time,’ Siem said.

‘Feedback from various professional associations and other market participants has been extremely necessary in structuring and adjusting the measures. We have involved experts in both the working group of crisis measures and the expert panel of economic recovery to ensure that the measures meet the needs of entrepreneurs as much as possible. We continue to develop various financial solutions that would be universal enough to bring the financial aid provided by KredEx into the economy faster and more flexibly,’ Siem added.