Inquiry targets tourism funds

Date: 17/10/1996

A SPECIAL internal task force is preparing to investigate hundreds of EU-funded tourism projects and a director-general is taking early retirement as the European Commission re-organises one of its most vilified departments.

The radical shake-up of senior staff in the tourism and small businesses directorate-general (DGXXIII) is being implemented as the European Parliament threatens to freeze 10&percent; of Commissioners' 1997 salaries unless the department's management is seriously overhauled.

MEPs will decide whether to carry out the threat when they give their initial approval to the Union's 1997 spending plans in Strasbourg next week, before finally adopting the budget in mid-December.

“It is not a question of individual people in DGXXIII. The whole department has to be managed so that we are sure the big sums of money involved are being run in a proper way. If this is not the case, the Commission must change the structure. We want to be sure there is proper financial management in the future,” explained budget committee chairman Detlev Samland.

Tourism Commissioner Christos Papoutsis began an extensive overhaul of the directorate-general's top management in the spring after allegations of inefficiency and fraud which led to the dismissal of two tourism officials and investigations by Belgian police.

The increasing emphasis which Commission President Jacques Santer is placing on small and medium-sized enterprises (SMEs) as creators of employment is seen as a further incentive to improve the embattled directorate-general's management and morale.

Several senior staff have already been drafted in from other departments and Director-General Heinrich von Moltke is now preparing to take early retirement.

In a bid to respond to detailed criticisms made by the Court of Auditors, Papoutsis is establishing a small team of experts to investigate every tourism project ever funded by the Union.

“The task force will have to examine 470 individual projects which were funded between 1990 and 1994. It will go through each single case by June next year and visit member states so we can give a full reply to the Court of Auditors as soon as possible,” said one senior official.

The Union's tourism and SME policies are not the only targets MEPs will have in their sights when they examine the 88-billion-ecu budget next week.

The Parliament is expected to follow the lead set by Union governments in July by endorsing an austerity budget, but the two are set to clash over the financing of the Union's prestigious Trans-European Networks (TENs).

With the Council of Ministers this week maintaining its opposition to MEPs' demands for an extra 1 billion ecu for the projects, the Parliament is expected to transfer funds away from TENs feasibility studies to other internal policy areas facing a cash squeeze.

The Parliament's budget committee will argue that Union governments took too sharp a knife to some EU programmes in July and is recommending that funding be increased for various energy, education, environment, health and consumer protection programmes.

Dutch liberal MEP Laurens Brinkhorst, parliamentary rapporteur on the 1997 budget, warned: “The budget will be very much prejudiced by the fate of the TENs. People should start to understand you cannot just ignore civil society. Hundreds of non-governmental organisations active in and around Brussels depend on the EU budget.”

Despite majority support on the budget committee for trimming 1 billion ecu off regional and social spending next year, many MEPs are expected to oppose the move next week amid fears that this could pave the way for wider structural fund cuts.