Just what the Eurosceptics have been waiting for: The European Court of Auditors’ Annual Report on the implementation of the 2008 EU Budget is now on the agenda. The good news in advance: the overall results for 2008 reflect the improvements in the management of the budget in recent years. This is mainly due to a better budget management in the field of agriculture and natural resources as the primary concern of recent years. For the first time the Court does not pronounce a negative judgment on this sector - so this is good news.
Much has yet to be done regarding the efficiency of budget management. Thus, the Court‘s negative conclusion in its report refers to the cohesion policy which accounts for around one third of the total budget funds (36.6 billion Euros): The error rate of the funds is dangerously high - that means that more than 11% of the funding disbursement should not have been made and had consequently been incorrect! An “error” in the opinion of the Court occurs if EU grants are paid out for data of excessive square footage or for ineligible expense items. Yet, one should clearly distinguish between unintended mistakes of applicants and fraud, a separation which is not always necessarily made by the public, ending up in exaggerated headlines. Consequently, the Member States are called to reform their control system effectively. Again, this year’s report is making it abundantly clear: If budget management of the European Union causes criticism it is not because of the “EU“ but because of the Member States themselves that do not monitor payments sufficiently. As stated in the current report, the fact that the surveillance systems of the Member States are only “partially effective” reveals in one of the most important areas like research, energy and transport, with a total of 7.5 billions of Euros and an error rate of 2% to 5%. The Court mainly recommends to improve the so-called “ex-post examination strategy” which should be monitoring effectively on all funds in terms of their legality and their consideration. It would be advisable that regulations of the expenses and their monitoring should be aligned and adhered to the EU rules. As the European Court of Auditors has a good reputation it would be useful for national audit courts to be in conformity with the regulations of the European Union. Rather, they praise their own national “accounting culture”, mostly to the detriment of the taxpayer.

Concluding, one point remains certain: The more complex the rules and regulations are, the greater the danger of them not being observed. Consequently the risk of error increases. The target planning of concrete programs must be simplified and clarified, well-designed rules and regulations which are clear and easy to use will reduce the risk of error. If we were to apply this principle consistently, then the annual presentation of the annual report would be “a day of good news“. After all, we have made great progress with the 2008 report.
The European Commission should not shy away from “naming and shaming”: The miscreant should be clearly identified so that the public finally sees who wastes their taxes.
Jorgo Chatzimarkakis is a Member of the European Parliament, he is a member of the Group of the Alliance of Liberals and Democrats for Europe Chairman of the Delegation to the EU-Former Yugoslav Republic of Macedonia Joint Parliamentary Committee, and a member of the Conference of Delegation Chairs, on the Committee on Budgetary Control and the Committee on Industry, Research and Energy.