By Martin Banks - 13th November 2007
The European court of auditors has again refused to give a positive statement of assurance to the EU’s accounts for the 13th year.
The auditor’s annual report, published on Tuesday, says there is either a "high level of administration errors, misallocation of funds or failure to adhere to disciplines and procedures".
While stressing this does not mean corruption is widespread, the report says this does leave EU accounts vulnerable to fraud.
The report says the court found a number of examples of control checks not being carried out properly.
It goes on to provide adverse audit opinions on most expenditure areas.
This year's report is the first since EU governments signed an agreement with parliament to provide a system of 'self-certification' for the 75-80 per cent of transactions national governments and agencies conduct on behalf of the EU.
Presenting the report, ECA president Hubert Weber said, "Reasons for the errors include neglect, poor knowledge of the often complex rules and attempts to defraud the EU budget.
"What is required is better management and control of EU spending.
"The commission should lead by example by paying particular attention to devising and operating its own internal control systems effectively.
"This would provide a model and encouragement to member states' operating systems.
"The key to effective management of EU funds lies in efficient and reliable internal control systems at all levels of administration.
"EU citizens are entitled to expect EU funds to be properly managed and controlled."
Reaction to the report was swift, with British Tory MEP Richard Ashworth criticising the auditors for the "blanket" approach he says they take to the EU budget.
Ashworth, his party’s budget spokesman in parliament, said, "It is helpful to know that the 2006 accounts failed to achieve an unqualified statement of assurance but, unless the auditors break their findings down, there will be no indication of where the particular weaknesses lie."
He added, "This is the first auditors report after national governments pledged to provide evidence that the EU transactions they carry out are done so with integrity.
"So far, national governments and the commission have failed to treat this annual charade with the urgency it requires.
"The court's report is more favourable than in previous years but it says the EU's accounts are still vulnerable to fraud. That is simply not an acceptable way to treat taxpayers' money.
"When I read the auditors report, I am overcome with a feeling of déjà-vu.
"Every year the auditors tell the EU it has failed yet they never give any specifics about which areas are failing more than others.
"Unless the auditors break down their findings in more depth, we will never be able to understand where the real weaknesses lie.
"It’s like saying your car has failed its MOT but not telling you whether it’s the brakes, the lights or the engine."
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