By Martin Banks - 4th May 2011
These are huge amounts of taxpayer's money
A €500m EU fund to help workers who have been laid off as companies move to cheaper markets is "open to question and fraud".
The European Globalisation Adjustment Fund (EGAF) which has already been earmarked to receive €500m in the 2012 EU budget is designed to help retrain workers whose job losses are linked to changes in global trade patterns.
However, UKIP MEP and former commission chief accountant Marta Andreasen says there are examples in Ireland and Spain where she says funds have been misused to the tune of €14.8m and €23m respectively.
She was speaking after parliament's budget committee approved €9.6m on Tuesday to help 'retrain' workers from the General Motors plant in Antwerp.
Andreasen said, "There is already a big question mark as to why European taxpayers money should be used to fund redundancy training for large multi-national companies, many of whom have posted multi-million profits. Unilever and General Motors are two such companies.
"Bigger questions however exist. There are no adequate controls in place to make sure that the funds are being effectively used to train employees who have been laid off. What is the point in retraining employees for industries that have already moved elsewhere?
"With Dell in Ireland, €14.8m was given to workers who were laid off. Yet structural funds were also given to Poland to attract Dell. This is a non-sensical approach akin to robbing Peter to pay Paul within an EU framework, the burden of which fell on EU taxpayers in both cases.
"Many believed that the EGAF was being used to buy support for the Lisbon treaty, which was taking place at the time.
"In Spain, El Pais newspaper reported in March of this year that up to 5870 small companies in Andalucia who were in receipt of EU funds to help workers, were misappropriating the funds.
"The funds obliged them to keep workers on for four years, however many were let go after 15 days, the companies involved presumably keeping the remaining money for themselves.
"Whilst I have every sympathy for workers who are being laid off as a result of the financial crisis, rich multi-national companies should have their own schemes in place to help retrain those workers affected by job losses in return for the profits they have made in the past.
"These are huge amounts of taxpayer's money we are talking about here, and considering that there are clear examples that the checks and balances are lacking and the system is being abused, it is clear to me that the EGAF should be discontinued."