EU paid out €7bn in error in 2013, auditors reveal

EU paid out €7bn in error in 2013, auditors reveal

Wednesday, November 5, 2014 10:27 pm

EU headquarters in Brussels

EU headquarters in Brussels

The European Union erroneously spent about €7 billion of its budget in 2013, the European Court of Auditors (ECA) announced on Wednesday, as it published an annual review.

The European Commission’s incoming Vice President for Budget, Kristalina Georgieva, told EU lawmakers in Brussels.

The figure comes as the bloc is preparing its 2015 spending plans, an exercise that frequently pits thrifty member states against EU lawmakers calling for more expenditure.

Rising Euroscepticism has also led to a more critical eye being cast on EU funding.

“Europe has lost some of its credibility and some of the trust of its citizens, and our urgent task is to rebuild them,” Georgieva told EU lawmakers.

“The 2013 audit revealed that 4.7 per cent of budgetary spending was not paid out in accordance with EU rules. Examples include giving money earmarked for small and medium-sized enterprises to companies that were in fact subsidiaries of larger corporations.

“Also farmers receiving aid for grassland that was actually covered by bushes or trees,’’ the ECA said.

The auditors also identified 14 cases of suspected fraud and referred these to the EU’s anti-fraud office, OLAF, for further investigation, while the ECA gave no detail of these cases.

She said that the audit also showed that the worst affected areas were regional policy and rural development.

She noted that the error rate was higher when both the commission and member states were involved in the process of allocating funds.

Georgieva pointed out, however, that the EU had recovered a large share of incorrectly spent funding in previous years.

“Over the last five years, the average amount of financial corrections was €2.9 billion annually or, on average, 2.2 per cent of all payments,’’ she told lawmakers.

The ECA also called for a greater focus on whether EU funding is actually delivering results.

“There are quite a lot of cases where monies have been spent in accordance with EU rules, but ultimately the result did not have a real impact on the lives of citizens,’’ ECA member, Lazaros Lazarou, noted

Join The Conversation

One Comment

  • Jon Danzig says:

    There is considerable misinformation in the UK media about the EU budget. The 4.7% identified by auditors as “errors” was not fraud, inefficiency or waste; it related to expenditure not strictly applied according to EU regulations. Most errors took place at national level by EU member states rather than in Brussels.

    Of course the error rate of 4.7% is too high and the European Commission has to do better: the target is an error rate of less than 2%.

    However, the EU budget is always balanced, so there is no debt or deficit. The independent
    Auditors reported that the European Commission’s accounts were accurate, legal, regular and reliable. The auditors have signed off the European Commission accounts every year for the entire 2007-2013 accounting period.

    It was Audit General Sir John Bourn who stated that if the European Court of Auditors applied the same standards to the UK, only 13 of the 500 Government budgets would have been signed off.

    Unfortunately on BBC radio yesterday morning journalist John Humphrys claimed that the EU Commission accounts had never been signed off as accurate or balanced. This is a classic myth, completely untrue, and somewhat worrying that a leading journalist, usually a stickler for accuracy, should repeat such a mistruth.

    See my article and video about this:

  • What do you think?

    This site uses Akismet to reduce spam. Learn how your comment data is processed.