Auditors dub Strasbourg deal ‘illegal’

Date: 07/12/1995

By Rory Watson

THE European Parliament stands accused of behaving illegally and of breaking its own internal rules when it signed the contract for its new multi-million-ecu premises in Strasbourg.

The harsh criticism of the agreement made by the then Parliament President Egon Klepsch in March 1994 is contained in a confidential 26-page Court of Auditors draft report now being studied by senior MEPs.

The investigation into the events that led to the Parliament's commitment to the 443-million-ecu Strasbourg complex parallels an earlier critical judgement on the contract for the MEPs' new Brussels premises. It is also likely to revive the controversy over the extensive parliamentary facilities spread between Strasbourg, Brussels and Luxembourg.

Piet Dankert, a Dutch Socialist MEP and former Parliament president, is critical of the way such financially-charged decisions were taken in a rush without proper discussion among MEPs.

“It's a real problem. I must admit that internal procedures are cumbersome, but they have to be respected. The president is able to commit himself to paying enormous sums of money without any financial supervision. It is not good enough to say we must learn from this, as I don't think there will be a next time. We already have enough hemicycles.”

Dankert acknowledges the political reality which led EU governments to designate Strasbourg as the Parliament's official seat, although most of its activities are in Brussels, but says: “From a functional, financial and political point of view it would be better to have just one centre.”

The auditors examined the complex procedures which must be followed before a contract of such magnitude is signed. They focused in particular on the fact that the prior approval of financial controller Eoghan O'Hannrachain was not given, as required.

“One of the main principles of the Financial Regulation was not applied. The signing of the contract was therefore illegal in terms of Community budgetary law,” says the report.

It accuses the Parliament's administration of side-stepping its obligations, allowing the contract for the hemicycle, 29 meeting rooms, 900 offices and ancillary facilities to be signed “in a situation of irregularity”. But it concludes that the long-lease contract with the Société d'Aménagement de la Région de Strasbourg is valid and should be honoured.

The Parliament's bureau is expected to approve a detailed rebuttal of the criticism next Monday (11 December), insisting the bureau - with only two dissenting voices - expressly gave Klepsch authority to sign the contract, effectively using its powers to overrule the financial controller.

The bureau will also say that the auditors failed to take account of the tense political situation at the time. To ensure the Strasbourg contract was signed, the French National Assembly threatened to block an agreed increase in the number of MEPs to take account of German unification - a move which would have thrown the European elections, due two months later, into turmoil.

Parliament Vice-President David Martin, one of the two dissenting voices last year, said: “The Parliament's mistake was to bow to French pressure when taking a decision on one of the major building contracts in Europe. No commercial business would have taken a decision that way.”

Attention is now likely to focus on the cost of the two parliamentary complexes. The Brussels buildings, the largest construction scheme in western Europe, are due for completion in April 1997, ten months behind schedule. The Strasbourg project, the largest in France, should be finished by the end of 1997.

Parliamentary officials forecast that the rental and maintenance of the two complexes could swallow almost a quarter of the institution's budget.