Follow-up: Bioeconomy as a key Government project

The priorities in Prime Minister Sipilä’s Government Programme were implemented by means of key project funding. One of the priorities was “Bioeconomy and clean solutions”. The National Audit Office conducted three performance audits related to this priority area in 2018–2019. The audit recommendations have been implemented partially, but there is still room for improvement in the preparation and implementation of strategic programmes and models.

In the same way as previous policy programmes, the key project or priority model aims to ensure that the key objectives set out in government programmes are achieved when the measures and funding to support them are divided across different ministries and administrative sectors. The procedure aims to increase the visibility of the measures taken across public administration to support each priority area and to examine them jointly. At the same time, it makes it possible to ensure consistency between the different measures.

The National Audit Office made several recommendations in its bioeconomy-related performance audits. The recommendations concerned, for example, the cooperation between ministerial working groups and public administration in the preparation of strategic themes, the quality of strategy preparation, the clarity and concrete nature of strategic target setting, and the clarity and effectiveness of various funding procedures. In the follow-ups of the audit recommendations in autumn 2021, the National Audit Office found that the situation had improved only partially.

Improvement in the guidelines for the preparation of priorities and in the forms of cooperation

According to the audit report Bioeconomy as a key Government project – overall key project funding (13/2019), the key projects as such had been mainly effective, and they had been reported on although there were no specific comprehensive guidelines concerning reporting. The National Audit Office recommended that the Prime Minister’s Office should prepare guidelines on the issues, measures, plans, and practices that the ministerial working groups should agree in writing as soon as they start their work. This would ensure that the operations run smoothly, systematically, and efficiently. In addition, the National Audit Office was of the opinion that when the Government’s strategy model and the effectiveness of the key project system is developed, special attention should be paid to systematic steering of the work of the ministerial working groups in the different priority areas.

Based on the follow-up, the development has been in line with the recommendations. More attention has been paid to the systematic nature and steering of the work of the ministerial working groups. For example, the Government updated the Minister’s Handbook in 2019 to support the work of the Government and the ministerial working groups. In addition, Sanna Marin’s Government Programme defines the Government’s working methods, including steering of the Government’s work, describing the current situation, developing various indicators, and carrying out impact assessments. (Instead of the term ‘key project’, the guidelines now use the terms ‘strategic project’ and ‘priority area’). However, according to the Prime Minister’s Office, the development of the Government’s strategic leadership instruments is still underway.

Strategy preparation still calls for comprehensiveness and concrete objectives

In the audit Preparation of the Finnish Bioeconomy Strategy (17/2018), the National Audit Office found that the preparation of the Bioeconomy Strategy – particularly the extensive involvement of the stakeholders – created fairly good conditions for achieving the strategic objectives. The development needs identified in the audit were related to, for example, strengthening the foresight activities, formulating strategic alternatives, and systematic assessment of their impacts. In addition, the audit called for a better description of, for example, the links with other strategies related to the theme, the implementation of the strategy, as well as the risks related to the strategy and their management. The monitoring of the implementation and impacts of the strategy as well as strategy-related reports and updates were found to be insufficiently planned. Defects were also identified in the filing of the documents related to the preparation of the strategy.

The follow-up was targeted at the Finnish Bioeconomy Strategy updated in 2021. Several conclusions and recommendations of the National Audit Office were taken into account in the update process. Stakeholder cooperation has been further strengthened, foresight data have been used more systematically in the knowledge base of the strategy, and the key documents related to the strategy update have been appropriately filed and made available. There is still room for further development, for example, in the clarity of the key objectives of the draft strategy and the indicators for their implementation, in the planning of the implementation and the required resources and risk management, and in the monitoring of the implementation of the strategy. In addition, the updated strategy lacks a monitoring and foresight plan for the operating environment of the bioeconomy. As a result of extensive stakeholder cooperation in the process, a broad consensus has been achieved on the key strategic objectives and a number of other principles. However, it is challenging that some of the key concepts – such as a sustainable bioeconomy – have remained open to interpretation. In addition, differing views have been considered only to a limited extent, and the “sustainability impacts” of the different strategic options have not been assessed. When the Finnish Bioeconomy Strategy was updated, links with several international and national strategies were identified, but there is no concrete interaction between the different strategies and policies. It would therefore be necessary and possible to promote the effectiveness of the Bioeconomy Strategy by means of an implementation plan drawn up after the adoption of the strategy.

It is still impossible to assess the effectiveness of additional funding for the Development Fund of Agriculture and Forestry

In connection with the key project, EUR 90 million of additional funding was granted to the Development Fund for Agriculture and Forestry (Makera) to improve the competitiveness and profitability of agriculture. In its audit 1/2019, the National Audit Office was unable to separate the impacts of the additional funding or the related impact assessment from those of other agricultural investment aids. It was also found to be impossible to assess the impacts of the additional funding from the perspective of the achievement of the Bioeconomy Strategy. It proved to be problematic that the current monitoring systems were not used to assess the activities supported with the additional funding and the effectiveness of investment aids in general.

In the follow-up, it was found that there had been little positive development in the issues referred to in the audit conclusions and recommendations. The impacts of the different forms of aid have been assessed mainly from the viewpoint of the beneficiary. The impacts of the additional funding granted through Makera still cannot be separated from those of other agricultural investment aids. Nor can the impacts of the additional funding on the implementation of the Bioeconomy Strategy be assessed, and the effectiveness has not been monitored from the perspective of central government finances. The information system in use and the data collected in it do not support ex post monitoring of the impacts of aids. The information system is currently being developed to a tool that will also benefit monitoring. The lack of information on the benefits of different measures for central government finances does not promote efficient use of state resources. Efforts should be made to resolve this problem.

The development continues to be monitored

According to the National Audit Office, the recommendations made in all the three audits related to the theme Bioeconomy as a key project have been implemented only partly, and their implementation is still partly underway. However, the National Audit Office will discontinue the actual follow-up but will continue to monitor the development as part of its normal monitoring of the operating environment. The National Audit Office will decide on any subsequent audits related to the theme separately in accordance with its planning procedures.