Bid to shame states into tackling fraud

Date: 02/11/00

By Simon Taylor

MEPS are calling on the Union's financial watchdog to name and shame member states which are not doing enough to combat the fraudulent use of EU funds.

In a paper on shaking up the Union's budgetary control procedures, UK Socialist Eluned Morgan says the Court of Auditors' annual report should include a list of cases where countries have failed to crack down on abuses of EU money. The list would also reveal how much money each member state had been forced to pay back into Union's coffers because its government had not controlled financial transactions properly.

The call comes ahead of this year's auditors' report on the 1999 budget, due to be published later this month, which will cover the last months of the Santer Commission before it resigned in disgrace. The report will also comment on efforts made by the Prodi administration to improve the executive's record on financial management and fraud prevention.

Morgan argues that publishing a country-by-country 'sinners' list' is essential to ensure that member states no longer "get away scot-free" in the auditors' annual report. Every year, the Court finds cases of fraud or mismanagement involving around €1 billion of Union funds.

But despite the fact that most of the blame for failing to prevent the errors lies with EU governments, which are responsible for paying out around 80% of all Union funds, the auditors' report never mentions offending countries by name. "The sinners' list will make it easier to access which member states are not taking things seriously," said Morgan.

She argues that exposing member states' shortcomings would also put pressure on backsliders to improve their controls. "You need to force member states to say what measures they have taken to tackle fraud," she insisted

The MEP says an overhaul of budgetary control procedures is essential in the wake of the Parliament's vote last spring to dismiss Santer's entire team over financial irregularities. "This report is important now because we pressed the nuclear button last year," she said. "You must recognise that you cannot do that every six months. Otherwise the Parliament loses credibility." Morgan denied suggestions that this meant the Parliament was letting the EU executive off the hook over its failings. "We are not taking our eyes off the Commission," she said. "Our priority will always be to monitor it."

The ability to withhold approval of Union accounts is one of the most powerful weapons the Parliament can wield against the EU executive - and it was used to great effect last year to force the Santer Commission to resign. MEPs withheld approval of the executive's 1998 accounts until the Commission agreed to set up a committee of independent experts to examine allegations of fraud, poor management and nepotism within the administration.

MEPs are calling on the Union's financial watchdog to name and shame Member States which are not doing enough to combat the fraudulent use of EU funds. In a paper on shaking up the Union's budgetary control procedures, UK Socialist Eluned Morgan says the Court of Auditors' annual report should include a list of cases where countries have failed to crack down on abuses of EU money.