EU auditors criticise European Commission spending error litany

The European Union’s official audit body has again criticised a litany of spending errors in programmes managed by the European Commission, raising questions over some €5.2 billion in expenditure last year.

Although there was scant reference to Ireland in the 2011 annual report of the European Court of Auditors, numerous problems were highlighted in other countries.

These included the payment of subsidies in Spain and Italy for land claimed as “permanent pasture” when parts of it were densely forested.

It reported training intended for electronics workers in unnamed countries being given to workers in other sectors and noted “over-claimed” personnel costs on research projects.

Handing down an adverse opinion on the legality and regularity of payments underlying the EU’s accounts, the court refused to give a formal statement of assurance in relation in relation to the figures.

This is the 18th successive year in which the Luxembourg-based court, an independent EU institution, has taken issue with the accounts.

The court estimated an “error rate” of some 3.9 per cent in the EU’s €129.4 billion budget for 2011, up from 3.7 per cent in 2010 and 3.3 per cent in 2009 but down from a rate as high as 7.3 per cent in 2006.

“We have not given a full statement of assurance . . . because there are still issues that the commission and member states need to address to ensue that the public purse is properly protected,” said Kevin Cardiff, the former Department of Finance secretary general who took Ireland’s seat on the court in March.

“At a time of financial crisis, the proper spending of public money is all the more important,” he told reporters.

The commission said the overwhelming majority of payments were free from quantifiable error and said the overall error rate was “stable”. Audit and anti-fraud commissioner Algirdas Šemeta said member states must up their game when it came to financial oversight but said spending errors did not mean EU money was lost, wasted or affected by fraud.

“When the Court of Auditors refers to an error rate, it means that money should not have been paid out because a project did not meet the detailed rules making it eligible for EU funding,” he said.