The criticism meted out this year by the European Court of Auditors is politically containable. The damage could have been much worse. When the European Union is embarking on a discussion of its spending levels after 2013 and when the negotiations on the 2011 budget are in full swing, a more damning report from the EU’s auditors would be seized upon by those wanting to cut back the budget. Rightly so. If, in times of austerity, the EU is to command public support for its budget, it has to demonstrate that money is spent wisely, well and within the rules.
The auditors’ report shows instead that not all the money is being spent in strict compliance with all the rules. The reflex in the European Commission and the European Parliament is to blame the national administrations for not managing EU money effectively. There is something in that: the auditors find disturbing weaknesses in the agencies paying out to farmers: only one state (Latvia) out of eight met the required standards. Some of the failures – keeping an adequate database of farmland, for instance – are basic. Improvements have been made in the management of cohesion money, but it is still the area of spending with the greatest problems.
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But blaming the national administrations will not explain away everything. The auditors also find an unacceptable error rate in research, energy, transport, external aid, development and enlargement, policy areas where less responsibility lies with the member states. More generally, the auditors still find fault with most of the supervisory and control systems.
The EU administrations should draw two principal lessons from this report. The first (not new) is that until the rules for claims and payments are simplified, the errors will persist. The second is that without renewed political and administrative commitment, of the sort that José Manuel Barroso proclaimed back in 2004, the Commission will not win a positive verdict from the auditors. The current trend is not good enough.