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2007 BUDGET : REPORT REVEALS NUMEROUS IRREGULARITIES IN STRUCTURAL FUNDS.

Numerous cases of irregularities in the execution of the EU budget were notified to the European Commission in 2007, the largest number concerning own resources and Structural Funds. This is what is revealed by the Report on the protection of the financial interests of the Communities - fight against fraud', published on 21 July by the Commission.

The document contains a statistical presentation of all the irregularities communicated to the EU executive by member states with cases where fraud is suspected highlighted. Preliminary figures show that the estimated amount of irregularities increased in the different sectors but remained relatively stable as a percentage of the budget. For own resources and agriculture, the number of irregularities is 5,321 and 1,548, respectively, which has "an estimated financial impact for suspected fraud" of 106 million and 44 million. The most worrying figures concern Structural Funds and Cohesion Funds, with 3,832 irregularities, which has an estimated financial impact of 141 million (see table). This sector is often subject to irregularities. There is a scandal resulting from the publication of the 2006 annual report from the EU Court of Auditors, in late 2007, which revealed a error rate of 12% in the management of these funds, meaning 4 billion at risk.

For the EU executive, the growing number of irregularities communicated "can be a good sign of improvement in monitoring". Furthermore, it wants to put more responsibility onto the shoulders of member states because even though it is responsible under the treaty for the execution of the budget, member states alone execute 80% of funds. The Commission also wants to be clear on the fact that it is a question of "suspicion" of fraud, ie that "it is only at the end of a budgetary procedure, when a court as ruled accordingly, that we can talk about fraud".

The same day, European Anti-Fraud Office (OLAF) published its 2007 activity report describing, with the help of 15 case studies, the actions carried out against fraud. In 2007, the total of funds recovery from member states stood at 203 million.

The two reports are available at www.europolitics.info > Search > 231290

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Publication:European Report
Date:Jul 23, 2008
Words:356
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