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Government inquiry criticises Danish innovation fund

Investigation flags problems with handling of Covid-19 grant applications and dismissals

The Danish Agency for Education and Research has highlighted several issues with the Danish Innovation Fund’s handling of grant applications and the dismissal of two employees.

The agency, the supervisory arm of the Danish education and research ministry, published the results of an investigation on 15 February. The investigation was initiated after two employees warned management at the Innovation Fund—which funnels public money into innovation and technology projects—that it was about to act illegally when attempting to quickly distribute money for coronavirus-related research.

The two employees were subsequently dismissed from the fund, which prompted the Danish Agency for Education and Research to subject the Innovation Fund to a review.

In the agency’s 43-page report summary, it criticises several aspects of the fund’s operations. The agency, which acts as a watchdog on public science spending, said that the process by which the chairman of the fund’s board, the two deputy chairmen and an additional board member received and processed Covid-19 funding applications fell short of the correct procedures.

“During the urgent processing of the applications there were significant deviations from the requirements for case processing and assessment that were announced in the current notice and associated guidelines,” the report found.

It went on to note that Covid-19 funding applications were processed according to different rules than other applications—including when it came to peer review and candidate interviews.

One application won 19.1 million Danish kroner (€2.5m) from the fund. In relation to this, the report said the investigation had uncovered evidence “that the Innovation Fund has, to a significant extent, given positive special treatment to one applicant, which constitutes unreasonable discrimination in relation to the other applicants”.

The report said that one of the persons in charge of the fund back then was also chairman of a company involved in a grant application to the fund. The report criticised the fact that no further action had been taken to avoid a conflict of interest as soon as it became clear that one of the people deciding the winning applications was affiliated with a project that had applied for support.

The agency said that the person in question should not have continued to process the application without sufficient justification. However, it stressed that there had been no evidence of wrongdoing.

Regarding the dismissal of two staff members, the agency’s report said that “no reason has been found, as part of the investigation, to confirm the Innovation Fund’s reasons for the redundancies in question.”

It went on to confirm that the dismissals are currently subject to arbitration.

Tina Fanø, chairwoman of the Innovation Fund, issued a response to the report on the fund’s website. “The fund takes the criticism seriously,” she said. “There must be an assessment of processes and procedures. The issues pointed out by the supervisory authority must be rectified, and that work is in full swing.”