Parliament also deplores the lack of checks on customs duties collected by Member States and failures to recover incorrectly-spent funds.
The resolution, drafted by Cătălin Sorin Ivan, is a response to the European Commission’s 2009 annual report on the protection of the Communities’ financial interests and the fight against fraud. It was passed with 655 votes in favour, 3 against and 18 abstentions.
Bad reporting – some fraud rates “suspiciously low”
Parliament strongly criticises the Commission report for providing too little information on fraud and irregularities. This is considered a result of bad reporting by Member states. The fraud rates in France and Spain are, for example, considered “suspiciously low”. In future, MEPs want to see a clear division between irregularities and fraud, given that fraud is a criminal offence, whereas an irregularity is a failure to comply with a rule. They also ask for a breakdown of estimated fraud and irregularities for each Member State so that disciplinary action can be taken against individual countries.
Large amounts of EU funds are still spent incorrectly, says the resolution. Parliament calls on the Commission to take action to ensure prompt recovery of those funds, especially in Italy. In agriculture and cohesion policy in particular, the rate of recovery of outstanding amounts is “catastrophic”, say MEPs.
Penalties
Parliament wants the Commission to exert pressure on Member States to provide reliable and comparable information and to impose penalties for failing to comply with reporting obligations. In line with the budget discharge report for 2009, Parliament also stresses the need for national politicians to take political responsibility for the spending of EU funds by their national authorities, which accounts for almost 80% of EU expenditure.
Own resources
Parliament is also concerned about the high number of irregularities in the collection of own resources in Austria, Spain, Italy, Romania and Slovakia. It calls on these Member States to step up their customs surveillance systems. The scale of fraud relating to imports from China is a cause for serious concern, it says.
Agriculture
Parliament calls on Austria, Finland, the Netherlands, Slovakia and the UK to meet their reporting obligations in the field of agriculture. The Commission should closely monitor agricultural spending in Spain and Italy, where the number of irregularities as well as the amounts involved were the highest, it says, adding a request for updates on specific remedial measures taken in these two Member States.
Cohesion policy
MEPs are deeply concerned about the high rate of error in spending in this policy group, which in 2009 was above 5%. However, given that many of these irregularities are arguably due to the complexity of procurement procedures, Parliament asks the Commission to propose simplified rules. In this area too, the recovery of incorrectly-spent funds from beneficiaries is far from satisfactory, it notes.
Pre-accession funds
Parliament is also concerned about the high rate of fraud in Bulgaria in connection with the Special Accession Programme for Agriculture and Rural Development (SAPARD) in 2009. For the whole programming period, this rate, at 20%, is the highest rate seen in all funds analysed. The Czech Republic, Estonia, Latvia and Slovenia reported a zero rate of fraud for SAPARD, which prompts suspicion either about the reliability of the information provided or about these countries’ ability to detect fraud.
Confiscating criminal assets
MEPs call on the Commission, the EU agencies concerned and the Member States to take measures and provide resources to ensure that EU funds are not subject to corruption, to impose dissuasive sanctions where corruption and fraud are found, and to step up the confiscation of criminal assets involved in fraud, tax evasion and money-laundering-related crimes.
