MEPs accuse Council of hypocrisy over financial reform

Date: 01/02/01

Member states are locked in a battle with the European Parliament over key financial reforms, with MEPs accusing EU nations of double standards when it comes to fighting fraud.

Euro-MPs say member states' refusal to subject their own Union administrative structure, the Council of Ministers, to the same financial reforms that theyare demanding of the Commission is leaving them open to charges of hypocrisy.

"The Council seems to be taking the approach that what is good for the Commission is not necessarily good for them, too," said Dutch socialist MEP Michiel van Hulten, the parliament's rapporteur on audit reform.

The row revolves around moves to change the way EU spending is monitored in the wake of scathing criticism from the independent wise men who played a key part in the downfall of the Santer Commission, as well as from the Court of Auditors.

Under current rules, financial controllers performa dual task, approving payments before they are made and then auditing their own books to make sure they are in order.

The wise men said this creates a conflict of interest. To address the problem, Reform Commissioner Neil Kinnock insists the two processes must be separated, with an internal auditor taking over responsibility for post-payment monitoring.

While all sides agree this is the way forward for the Commission, member states are refusing to apply the same rules to the Council secretariat and the Parliament.

They say that, unlike the Commission, no one has ever accused the Council of fraud or bad financial management and that sums handled by the institution are tiny compared with the billions of euro the EU executive is responsible for spending.

But Van Hulten argues that with new powers in the justice and home affairs and defence fields the Council is an increasingly important institution with a growing budget, and so must follow the same rigorous auditing rules. "The reform is just as urgent for the council as it is for the Commission," he said.

Both sides are hoping to hammer out an agreement at a meeting of finance ministers on 12 February.

Member States are locked in a battle with the European Parliament over key financial reforms, with MEPs accusing EU nations of double standards when it comes to fighting fraud. Euro-MPs say Member States' refusal to subject their own Union administrative structure, the Council of Ministers, to the same financial reforms that they are demanding of the Commission is leaving them open to charges of hypocrisy.