Court critical of CAP debt-recovery system
Auditors say 90% of the amounts listed as recoveries in the represented reimbursements from national budgets.
The European Court of Auditors (ECA) has criticised the mechanism used by the European Commission to recover undue payments made under the EU’s €55 billion-a-year Common Agricultural Policy (CAP).
The ECA found that 90% of the amounts listed as recoveries in the EU’s annual accounts represented reimbursements from national budgets rather than actual recoveries from CAP beneficiaries. Its report, published yesterday (28 September), says that while this approach protects the financial interests of the EU, it diminishes the deterrent effect of recovery from beneficiaries.
The auditors analysed the effectiveness of member states’ systems to recover undue payments and the Commission’s monitoring of the recovery process. Undue payments may, but do not necessarily, involve fraudulent activities, which fall under the mandate of the Commission’s anti-fraud office (OLAF).
Different approaches
In 2006, in response to earlier criticisms by the ECA, the Commission changed the way in which debts are recorded, reported and certified in the member states. The court acknowledged that those changes have produced more accurate information, but it concluded that national differences in implementation continue to have a negative impact on the EU budget. Member states differ in the way they recognise and write off debts, reported figures are not comparable across countries, and interest charges are not applied consistently, it said.
The court said the Commission should impose deadlines on the member states to record irregularities and transmit information to OLAF. It also called for rules on applying interest, and for clarification of some reporting and accounting concepts that have been interpreted inconsistently. The court also asked the Commission to “explore methods” to reduce the share of recoveries that come from national budgets rather than from direct recoveries of undue payments from recipients.