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Auditors criticise EU for lax controls on spending

06 November 2012, 17:20 CET
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Auditors criticise EU for lax controls on spending

2011 Budget

(BRUSSELS) - Controls over EU spending, a hot topic in the run-up to a sharply contested summit on the bloc's long-term budget, fell short again last year, a Court of Auditors report showed Tuesday.

"Put simply, the court found too many cases of EU money not hitting the target or being used sub-optimally," said Vitor Caldeira, its president of standards set for sound accounting.

The error rate -- when funding is made to projects which do not meet the conditions required -- came in at 3.9 percent, below 4.0 percent for a third year in a row but still nearly double the 2.0 percent auditors require to judge the accounts free from "material error".

Caldeira highlighted rural development, environment, fisheries and health as the worst performing components of the budget with an error rate of 7.7 percent, while regional policy, energy and transport remained high at 6.0 percent.

"It is here, in these areas, that we found the member states are not doing their job as fully as they should," he said, calling for a greater government commitment to improving financial controls.

The errors found showed that "control systems examined were only partially effective. In other words, control systems were not realising their full potential to prevent or detect and correct errors," he said.

The European Commission for its part said the report showed that over recent years it "has delivered on its promise to ensure high-quality management and control of EU funds."

Errors "should not be seen as money lost, wasted or subject to fraud," a Commission spokeswoman said, adding that the report showed "the result of immense efforts to improve financial management."

"We are not complacent," the spokeswoman said. "We do not consider less than four percent to be acceptable ... we are aiming for two percent."

The report was greeted with derision by eurosceptics who said it once again demonstrated how the EU could not properly monitor its spending.

"You would think that after 18 years, a more mature EU could have its accounts signed off, but no," said Godfrey Bloom, a member of the European Parliament for the UK Independence Party.

"The EU ... has failed again," Bloom said, condemning "the cheek of these EU institutions and bureaucrats ... wasting people's money and demanding even more."

The Commission is preparing for a tough November 22-23 summit on its proposed 2014-20 budget, increased 5.0 percent to just over one trillion euros, which the biggest contributor states such as Britain insist is unacceptable at a time of austerity.

The EU Court of Auditors checks the accounts of all EU institutions.

Annual report of the European Court 
of Auditors 2011 - guide

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