Paul Stephenson has written an article entitled ‘The EU’s anti-fraud apparatus‘ for The UK in a Changing Europe Initiative. This initiative promotes rigorous, high-quality and independent research into the complex and ever changing relationship between the UK and the European Union.
Funded by the ESRC and King’s College London, it is tailored to be easily accessible to policy makers, businesses, journalists, civil society organisations, educational institutions and the general public who are interested in the UK’s relationship with the EU.
The EU’s anti-fraud apparatus
The EU’s annual budget is roughly €140 billion (£110 billion), representing just over 1% of the total combined gross national income of the 28 member states. Understandably, the EU and its institutions keep a close eye on how this money is spent, and works hard to ensure that fraud is avoided. In this piece, I describe the governance framework which oversees this spending, and shed some light on its operation.
How is EU money spent?
The EU budget is spent according to the priorities agreed on by member state representatives in the Council and the elected politicians in the European Parliament. In most cases they decide together on the laws behind these common policies.
One of the major tasks of the European Commission is then implementing these priorities. As such, it acts very much like any national civil service, with departments (directorates-general – DGs) covering transport, agriculture, social policy and so on. Commission staff are in close contact with civil servants in the respective national ministries of the 28 member states to discuss how best to design policy, how to cost it, and then how to actually make it happen on the ground.
Most of the EU budget is spent across the regions of the EU member states. European policies are designed in such as way as to ensure that regional and local authorities in the member states, such as town councils, are as active as possible in spending the money on their own projects.
Who is responsible for ensuring money is well spent?
There is a clear division of labour between the Commission and the member states. National governments are jointly responsible, with the Commission, for ensuring that there are control mechanisms in place at the national level to provide oversight while money is being spent, and not simply once it has been spent. Together they should ensure that money is used properly – which means correctly, fairly, wisely.
The European Court of Auditors (ECA), established in 1977, assesses the soundness of the financial management systems in place in those public bodies spending the EU budget. The ECA performs different types of checks: financial audits (“Do the sums add up?”), compliance audit (“Is the spending legal?”) and performance audit (“Did the spending provide value for money?”). It has decades of professional experience in auditing, employs specialists with extensive experience in the private sector, and is active in shaping the rules and practices of audit internationally…. read the remainder of the article at: http://ukandeu.ac.uk/explainers/the-eus-anti-fraud-apparatus/.
