Eurosceptics across the media have been up in arms recently, touting yet another inaccurate story that our taxpayer contributions to the EU had directly paid for an Elton John concert held in Italy – “gross wastage”, they screamed – “just another example of how ‘european’ funds are wasted” they grumbled, almost all of them wrapped up with “get us out of this union”.
So I noted with some glee this morning that the organisers of said concert have been ordered to pay back the 720,000 € (£613,000) they used to stage the event without delay. The money was reported as having come from the European Union as finance for the regional development of Campania… a good example of EU waste you might say, but that’s not quite the whole story.
You see the funds don’t come directly from the EU: funds for regional development are distributed first to the individual nation states – it’s a cludged system, and one that is almost solely responsible for the commission’s auditors not being able to sign off the accounts for so many years. The Commission simply signs off on the gross national amount, after which the responsibility for distribution is entirely driven nationally.
Indeed, this waste of funds, and the following demand for repayment only followed a complaint by Mario Borghezio, an Italian MEP from the Northern League party, who brought the attention of the commission onto this issue, describing the use of the funds [as a waste of EU cash which was] “shameful“.
This wastage is currently under debate both within the Parliament and the Commission as it’s been acknowledged for some time that certain national governments were fiddling the books. You’re probably also thinking, well we all know where to point the finger, Greece, Spain, Itally… well yes, at least two those have been highlighted, but so is the UK. In fact the UK is being used in the same sentence as Greece and Spain as being one of the worst offenders!
The UK government defends the improper distribution and poor accounting of EU funds by pointing out that the huge amount which is now being demanded back by the EU “had been accrued over six years“.
In case you missed that, it’s a tacit admission by the UK Government that they have been holding on to money that they shouldn’t have for six years. Money that was either not spent or spent incorrectly on regional development, the common agricultural policy, infrastructure and energy projects, cultural activities and a thousand other areas of supranational interest funding by the European Union.
MEPs are now calling for a need to get tough with nation states and the european bodies that don’t follow the rules: the EU needs to get it’s books in order if it is to have any mandate for future projects which are underway – the most obvious way of doing this would be to make national commissioners directly responsible for the funds which their country takes: it ensures that another ‘super-agency’ does not need to be created to distribute funds directly, and the whole european machine would have someone to hold directly accountable should the funds not tally. So far only Sweden and the Netherlands have shown the political will to do this, having their commissioners sign off directly on received funds each year.
If you’re not lobbying your MEP yet – make sure you do: the wastage of EU funds is one of the most pressing issues facing the union, doubly so as national and international budgets tighten.
It’s not all bad news though. There was some good financial news for the EU in the recent budget report, with a statement from the auditors that the individual European organisations had finally got their their act together, and that individually the accounts of each organisation made sense and could be approved. If we can now get the national distribution correct, we’ll be well on our way to being able to approve the global accounts, which will no doubt do great good in being able to approve year on year spending for the union as a whole.