Rural development policy errors due to 'breaches of conditions' says ECA

A report by the European Court of Auditors (ECA) finds that most of the "errors" in rural development policy are due to "breaches of conditions" set by member states.

The auditors say tens of billions have been spent "in error" from rural development funds.

But the ECA cautions that the control authorities in member states "could and should" have detected and corrected most of the errors affecting investment measures in rural development.

Their control systems are deficient because checks are not exhaustive and are based on insufficient information, says the ECA.

Rasa Budbergytė, the ECA member responsible for the report, said,“It’s important to understand why the rate of errors in rural development policy is unacceptably high."

"The key to bringing it down is to strike the right balance between the number and complexity of rules governing spending – which help achieve policy goals such as improving agricultural competitiveness – and the efforts to guarantee compliance with such rules."

The special report, entitled Errors in rural development spending: What are the causes, and how are they being addressed?, focuses on the compliance of rural development implementation with the applicable laws and regulations and describes the main causes of the high error rate for rural development.

It also assesses whether the steps taken by the member states and the commission are likely to address the identified causes effectively in the future.

The report includes information made available to the auditors up to the end of September 2014.

The EU and member states allocated more than €150 billion to rural development policy during the 2007-2013 programming period, divided almost equally between investment measures and area-related aid.

Rural development expenditure is implemented by shared management between the member states and the commission.

Individual countries are responsible for implementing the rural development programmes at the appropriate territorial level, according to their own institutional arrangements.

The Commission is responsible for supervising member states to ensure that they fulfil their responsibilities.

The "significant level" of non-compliance with applicable rules, as reflected in the high error rate, means that the money concerned is not spent according to the rules, said the ECA.

It concludes: "This may negatively affect the attainment of rural development policy objectives, such as improving the competitiveness of agriculture and forestry, improving the environment and the countryside, improving the quality of life in rural areas and encouraging the diversification of economic activity."

However, Jonathan Arnott, a UKIP MEP and member of the budgetary control committee, is still critical of the EU, saying: "The commission has again shown it is incapable of finding a way to ensure taxpayers' money is spent properly. For eurocrats, the failure to spend a billion-plus euros according to the rules is business as usual."

Arnott added that while one "could expect any multi-billion euro operation to have a rate of error in how money is spent, the auditors found that the rate of error in spending EU rural development funds in 2011-2013 was 'unacceptably high.' In fact, the rate was 8.2 percent, or four times the maximum rate of error that would be tolerated in private enterprise.

"In this report the auditors calculated the rate of error just for three years. If calculated across the entire €150bn 2007-2013 rural development budget, this would indicate that €1.23bn has been spent by member states without adhering to the rules.

"The commission is responsible for 'shared management' of these funds, so the eurocrats must share the blame for the failed oversight and gross errors made in how these billions were spent."

Share this article: