EU accounts not signed off… for the 16th consecutive year

Civitas, 10 November 2010

The Court of Auditors has refused to sign off the EU accounts for yet another year, making this the 16th year in a row that the EU accounts have failed to receive a clean bill of health, writes Natalie Hamill. This year’s report found discrepancies in 90% of last year’s EU budget, and yet the European Parliament is currently demanding a 2011 budget increase of 6%, which has, unsurprisingly, gone down like a lead balloon with cash-strapped and budget-slashing national governments.

The Common Agricultural Policy (CAP) and Cohesion Fund payments are, as usual, the main culprits for the majority of the concerns highlighted. These are two areas where EU citizens regularly express dissatisfaction over EU spending. The CAP, which falls under the Agricultural and Natural Resources branch of the budget, has seen its error rate rise to 5%, and for the Cohesion Funds this figure is 11%.

It is rather ironic then that the Court of Auditors report has been released on the same day as the EU’s highest court ruled against transparency in CAP payments, deciding that publishing the details of farm subsidy recipients ‘infringes their privacy rights’. If ever there was a time to insist on improved transparency in order to avoid the misappropriation of funds and payments to undeserving recipients, it should be the day the Court of Auditors are, once again, unable to sign off the EU accounts.

The court case regarding farm subsidies was brought by two German farmers who objected to their names, addresses and allocated funds being published in the public domain, a sentiment that is shared by many farmers across the EU. Despite the large slice of the budget earmarked for CAP payments (more than a third of all EU spending) and the controversies that have made the headlines (the Royal families, for example, that claim high amounts of EU funding) the court found in the claimants’ favour, and their details can no longer be published.

The CAP is one of the more contentious areas of the EU budget. CAP funding is plagued with tales of fraud and figure fixing, non-existent olive groves and, even worse, corrupt ministers and officials siphoning off the funds. Of course the honest claimants far out-weigh these examples; however, funding discrepancies still occur with frightening frequency. The policy’s standing is further damaged when you visit websites like Farmsubsidy.org (which publishes details of who receives what in payments) and see Danish Crown, Nestlé, and Tate & Lyle in the top 10 recipients of CAP payments. Whilst under the current policy rules they are perfectly entitled to claim, these organisations are not the poor and struggling farmers we like to envisage the fund helping.

Only 20% of UK citizens trust the EU institutions. Removing access to details about the CAP and putting the public back into the dark about who is getting how much of the funds, is a step in the wrong direction. It makes the EU look like it has something to hide. Continually failing to get the accounts signed off, whilst asking for greater amounts of EU citizens’ money (via budget increases); will only alienate the EU further. If the EU cares about restoring the public’s faith in its accounts and spending, then transparency and accuracy should be the objective of every EU fund allocation, and this includes spending under the CAP.