Brexit & EconomyPoliticsEC launches crackdown on funding

EC launches crackdown on funding

States face crackdown as EC vows to claw back funding

The European Commission is set to launch a crackdown on member states over
redistribution spending, in a bid to win a positive statement of assurance on
its accounts.

‘The commissioners were asked to be stronger, so that will be our policy over
the coming year,’ Brian Gray, chief accounting officer for the EC, said.

The commission already has the power to recover spending that is poorly
accounted for from the member states, but the prospect of more serious attention
may well see large sums clawed back.

The European Union failed to earn a statement of assurance from the European
Court of Auditors for the thirteenth time in a row this week after the court
drew particular attention to problems in the structural fund, the part of the EU
that redistributes money to the poorest regions.

There was better news in other areas, with problems on agricultural spending
measured at just above 2%, the threshold above which the court cannot give a
statement of assurance. ‘We have hopes [for a positive opinion] next year,’ Gray
said.

Over 40% of the total EU expenditure now gets a positive opinion, which is up
on previous years. But the problems in the structural fund seem not to have
altered. A third of the problems relate to missing documents, a third to
situations where there are complex interpretations of the rules, and a final
third to errors in claims for funds.

‘Our supervision is in principle good but proving ineffective,’ Gray told
Accountancy Age. There are also issues with funds paid out by
non-governmental organisations, where a large chunk of money did not meet the
rules laid down for claiming it.

Last week, EC whistleblower and Gray’s predecessor Marta Andreasen lost her
case against her dismissal, a verdict she said she would appeal. Because so many
issues had not been addressed, ‘I believe I will be successful on appeal,’ she
said.

Andreasen was outspoken in her criticisms of the EU accounts this week: ‘This
year the court is trying to clarify that the management responsibility for the
accounts and the underlying transactions remains with the European Commission.’

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