The Sunday Express claims in its article “£270m EU cashback row“, 14 July 2013 that a political row has erupted over refunding of money for EU funded regional projects in the UK. Serious allegations are made in the article. The European Commission is therefore setting the facts straight here.
The Commission has indeed interrupted interim payments for English regional programmes. It has done this because the UK’s own auditors – not “Eurocrats” – have identified serious deficiencies in the national management and control system for these payments.
When problems at national level are spotted, as they have been on this occasion – and others – in the UK, the Commission acts to protect taxpayers’ money by interrupting payments until the issues are resolved. The Commission has done exactly the same when similar issues have arisen in other Member States.
The payments can resume as soon as the UK auditors’ concerns have been addressed.
What is more the article says: “For 18 years in a row, auditors have refused to sign off EU accounts amid allegations of fraud and waste.”
First, the European Court of Auditors has for years now given an overall green light on the Commission’s financial accounts for centralised spending, in simplified terms money spent directly by “Brussels”.
Its reservations persist in areas where – exactly as in this case – money is managed jointly with Member States and spent at national level.
Second, the Court of Auditors has clearly said every year that most of the problems are not a matter of “fraud and waste” but of errors, many of them technical and having little effect on the final outcome of spending.
In addition, the audit of EU spending is very stringent and accounts are viewed as a single entity, unlike most national accounts. Former UK Comptroller Sir John Bourn once said to the House of Lords that if he had had to operate a similar system to the EU one: “I might have to qualify the whole of British central government expenditure.”
Nevertheless, the Commission agrees that performance needs to be further improved and continues to work to get the error level below the target of 2%.
It can only do that if all Member States, including the UK, also up their game.
It would seem perverse to insist on the need to improve financial control of EU spending, but to object when such control is exercised.