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EU Auditors Slam Commission for Budget Failures Amid Refugee Crisis

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The European Union Auditors have criticized the European Commission for its lack of responsiveness to the current refugee crisis, arguing that its budgetary controls are so complex that it has failed to react quickly enough to the current migrant crisis.

The President of the European Court of Auditors, Vítor Caldeira said Tuesday: "The EU must invest its money better." He called for a "wholly new approach to the management of EU investment and spending.

"Major changes are required by all those responsible for the way EU funds are managed."

According to the ECA's presentation of the report to the European Parliament, EU decision-makers must align the budget better with the EU's long-term strategic priorities and make it more responsive in a crisis.

EU budgetary spending totaled US$153 billion in 2014, but 4.4 percent of that — or US$6.7 billion — was defined as being spent in "error" — money which should not have been paid out because it was not used fully in accordance with EU rules.

The auditors warn that "if the EU is to address the pressing challenges it faces, it must manage the Budget better. The EU needs to deal with a number of financial backlogs in order to free up funds so they can be used where they are most needed."

In a sign of his increasing frustration with the European Commission, Caldeira said:

"There is a persistently high level of payment errors, which means too much money is still not spent in accordance with the EU's financial rules."

He said the EU was facing three major challenges: generating jobs and economic growth; meeting energy needs while achieving climate goals; and managing the pressures of asylum, migration and security.

Severe Pressure

He said there was a lack of proper control over how and where money was spent in Europe, with some EU grants not being spent wisely — or often not spent at all in some countries.

"Poor performance in terms of results achieved does not lead to Member States losing their performance reserve," the report said. 

"The EU budget is under severe pressure. It has been operating within the contingency margin for payments since shortly after the new MFF began —even before the Juncker Plan was launched or the full force of the refugee crisis was felt."

The multiannual financial framework (MFF) lays down the maximum annual amounts ('ceilings') which the EU may spend over a period of at least 5 years. The current MFF covers seven years: from 2014 to 2020.

"Some Member States are struggling to absorb the EU funds they have been allocated."

"In fact, in four Member States, the total not yet claimed from the EU budget is equivalent to 15% or more of their governments' annual spending," the auditors found.

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