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Accounting for the EU

Benefits and problems from the EU membership.

Accounting for the EU

Postby boomerang » Wed Nov 21, 2007 10:20 pm

Accounting for the EU
November 21, 2007

The European Commission talks a great game on reform. Then every autumn we get a stark reminder, in case we'd forgotten, that European Union mismanagement's alive and well -- thanks to the annual report on the EU's accounts.

The European Court of Auditors released its latest opinion last week, and for the 13th year in a row refused to sign off the EU's finances. "Errors of legality and regularity still persist in the majority of EU expenditure due to weaknesses in internal control systems both at the Commission and in Member States," according to the report.

Every year the Commission pleads innocence, arguing that responsibility for dealing with fraud lies with the member states who distribute the vast majority of EU funds.

True, poor administration at national level is to blame as well. But the major problem is the lack of a proper system of checks and accountability in Brussels. As the Court points out: "Regardless of the method of implementation applied, the Commission bears the ultimate responsibility for the legality and regularity of the transactions underlying the accounts."

A quick journey through key areas of EU spending throws up numerous examples of incompetence and waste. Not surprisingly, the Common Agricultural Policy (CAP) tops the list.

Of the €49.8 billion paid out last year under CAP, €15 billion were not subject to any proper checks. In addition, the Court found that "one quarter of the payments tested at final beneficiary level revealed overpayments." For example, nearly a quarter of olive growers in Italy, Spain and Greece had declared at least 5% more olive trees than they actually owned in order to pocket "significant" extra EU cash.

The structural funds budget -- €32.4 billion in 2006 -- is also rife with fraud. In theory this money is designed to improve overall economic performance in the Union by combating "regional disparities." But the Court noticed little improvement from previous years in financial management. Of the audited projects, less than a third "were found to be free from error." The Court warned that there was a "high risk" that project costs were "overstated" and that there were large numbers of claims for "ineligible expenditure." The report also states that there was generally "a lack of evidence to support the calculation of overheads or the staff costs involved."

The truth is that until expensive and wasteful policies such as CAP and the structural funds are brought back under national control, or scrapped altogether, we are unlikely to see any real improvement. Such sprawling, complicated, top-down spending programs are always going to be vulnerable to fraud.

The EU's failure to properly account for how most of its near trillion-euro, seven-year budget is spent is characteristic of the wasteful and perverse way it disperses all that taxpayers' money.

Luxembourg, the EU's wealthiest country, is the biggest beneficiary per capita while France will receive more money in absolute terms than any other member state. Despite being the second richest country in the EU, Ireland will still receive more money than it puts in, while Cyprus, with an income well below the EU average, will be a net contributor. This is for that moron Talat that didn't know the RoC is a net contributor

As ever the CAP is one of the worst culprits. In 2004, the 10 new member states from Central and Eastern Europe paid nearly €1 billion more into CAP than they got out of it, while comparatively wealthy countries like France and Spain continue to benefit disproportionately.

Europe's taxpayers deserve better than this.

Wrong...the RoC deserves better than this...The RoC should demand as to how, where and who the beneficiaries are....
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Postby humanist » Wed Nov 21, 2007 10:26 pm

Booms, thank you for an interesting report. Mate you have made the fatal mistake though of mentioning that moron's name. Good luck with the debate,
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