EU budget errors despite auditor sign-off

PAYMENTS FROM the European Union’s (EU) budget continue to be “materially affected by error”, according to its auditors, despite the union’s accounts being classed as a fair representation of its financial position.

The European Court of Auditors found improvements in the likely error for the budget as a whole for 2009. However, payments from the budget continue to be materially affected by error in all but two areas of expenditure – economic and financial affairs and administrative expenditure.

“Improving the quality of spending should be a high priority. Simplifying legislative frameworks and introducing more cost-effective systems to reduce the risk of error should contribute to this goal”, said Vitor Caldeira, president of the European Court of Auditors.

Algirdas Šemeta, commissioner for taxation, customs, anti-fraud and audit, at the EU, said: “We can be pleased with the improvements in EU financial management, which are recognised today by the Court of Auditors. But there is always more that can be done, and the Commission will continue its intense efforts to ensure that EU funds are properly accounted for and well spent.”

The EU spent €118bn (£102bn) in 2009.

Around €55bn were spent on agriculture programmes under the Common Agricultural Policy. Auditors found that 27% of sample transactions were affected by error.

Although the EU described the findings as its third clean bill of health in a row, others were less impressed by the findings.

Open Europe, a UK think tank comprising senior UK business heads such as Lord Sainsbury and M&S executive chairman Sir Stuart Rose, described the figures as “a hugely embarrassing annual tradition”.

“The sheer size and complexity of the EU budget means that it remains vulnerable to waste and mismanagement. Until member states and the European Commission resolve the inherent flaws in the EU’s spending there should be no talk whatsoever of budget increases,” said Open Europe analyst Stephen Booth.