Audit Office attacks EU funding schemes

A report into EU financial management acknowledges a "detectable improvement" in recent years in the way funding programmes work, but it warns: "There remain seemingly intractable problems with reducing the high levels of error in some significant areas of EU spending."

The verdict of the independent national financial watchdog echoes the view of the EU's own Court of Auditors, which last year gave EU accounting procedures a clean bill of health for only the second time in 15 years, but said the level of errors was still too high.

The European Commission runs the EU budget, about 80 per cent of which is returned back to needier parts of the member states in the form of regional, social and agriculture grants.

The Commission says mismanagement is therefore largely the fault of national and local authorities responsible for disbursing the funds from grant programmes – and Brussels regularly claws back million pounds it deems to have not been used in accordance with the rules.

In today's report, the head of the National Audit Office, Amyas Morse, says: "I welcome the signs of improvement in financial management of European funds across the EU but the persisting high levels of error are explained by the sheer complexity of these programmes.

"Departments in the UK should press for programmes to be designed with clear measurable objectives and in such a way as to promote efficient administration.

He went on: "Weaknesses in the administration of European schemes in the UK, such as the Single Payment Scheme (for farmers), continue to have an impact on the taxpayer."