EC claims €230m of EU agricultural policy funds unduly spent by Member States

Brussels, 3-5-2013 — /europawire.eu/ — A total of €230 million of EU agricultural policy funds, unduly spent by Member States, is being claimed back by the European Commission today under the so-called clearance of accounts procedure. However, because some of these amounts have already been recovered from the Member States the financial impact of today’s decision will be some €227 million. This money returns to the EU budget because of non-compliance with EU rules or inadequate control procedures on agricultural expenditure. Member States are responsible for paying out and checking expenditure under the Common Agricultural Policy (CAP), and the Commission is required to ensure that Member States have made correct use of the funds.

Main financial corrections

Under this latest decision, funds will be recovered from 14 Member States: Belgium, Czech Republic, Germany, Ireland, Greece, Spain, Lithuania, Hungary, Malta, Poland, Portugal, Slovenia, Slovakia and the United Kingdom. The most significant individual corrections are:

€ 83.6 million charged to Greece for non-compliant reduction of the minimum yield for the dried grapes;
€ 79.9 million charged to Poland for deficiencies in the check of the initial application and in the approval of the business plan for the Semi-subsistence farms measure;
€ 24.0 million (financial impact¹ : €23.9 million) charged to Greece for weaknesses in flock registers and on-the-spot checks for animal premiums;
€ 10.3 million charged to UK for weakness in identification of animals and in on-the-spot checks for the animal premiums.

Background

Member States are responsible for managing most CAP payments, mainly via their paying agencies. They are also in charge of controls, for example verifying the farmer’s claims for direct payments. The Commission carries out over 100 audits every year, verifying that Member State controls and responses to shortcomings are sufficient, and has the power to claw back funds in arrears if the audits show that Member State management and control is not good enough to guarantee that EU funds have been spent properly.

For details on how the clearance of annual accounts system works, see MEMO/12/109 and the factsheet “Managing the agriculture budget wisely”, available on the internet at: http://ec.europa.eu/agriculture/fin/clearance/factsheet_en.pdf.

Details of the individual corrections, by Member State and by sector, are given in the tables attached (annexes I and II).

Contacts :Fanny Dabertrand (+32 2 299 06 25)

Roger Waite (+32 2 296 14 04)

Annex I : Conformity clearance of accounts of EAGF and EAFRD

Decision 41: Corrections by Member state (In Million €)

Sector and reason for correction	Amount of correction		Amount of financial impact of the correction²
Belgium
Other corrections – correction proposed for exceeding of financial ceilings	0.595		0.595
Czech Republic
Other corrections – correction proposed for exceeding of financial ceilings	0.027		0.027
Germany
Rural development – correction proposed for lack of 100% verification of the parcels for Agri-environment measure	0.340		0.340
Other corrections – correction proposed for errors found during the financial clearance of accounts for 2009	0.935		0.935
Spain
Livestock Premiums – correction proposed for insufficient rate of on-the-spot checks for bovine and ovine and for incorrect application of sanctions	0.196		0.196
Cross-compliance – correction proposed for deficiencies in sanctioning system, 1 good agricultural and environmental condition (GAEC) missing and partial coverage of 2 statutory management requirements (SMR)	0.991		0.990
UK
Animal premium – correction proposed for weaknesses in identification of animals by management tags only, absence of reaction in terms of increase of numbers of on-the-spot checks, frequent announcement of on-the-spot checks more than 48h in advance	10.348		10.348
Rural Development – correction proposed for deficiencies in the scope of the on-the-spot checks, controllability and risk analysis	1.930		0.001
Other corrections – correction proposed for late payments and exceeding of financial ceiling	0.322		-0.277
Greece
Fruits & Vegetables – correction proposed for non-compliant reduction of the minimum yield for the dried grapes	83.613		83.613
Livestock premiums – correction proposed for weaknesses in on the spot checks and delays in I&R database updates for bovine	9.403		8.900
Livestock premiums – correction proposed for weaknesses in flock registers and on-the-spot checks for ovine	23.956		23.883
Rural Development – correction proposed for weaknesses in on-the-spot controls	6.175		6.175
Other corrections – reimbursement following the judgement issued in case T-158/09	0.821		0.821
Hungary
Other corrections – correction proposed for exceeding of financial ceiling		0.001	0.000
Ireland
Cross-compliance – correction proposed for 2 missing GAECs and incorrect application of sanctions		1.899	1.899
Lithuania
Rural development – correction proposed for weaknesses in the on-the-spot controls		3.449	3.449
Malta
Area Aids – correction proposed for weaknesses in the establishment of the payment entitlements		0.092	0.091
Poland
Rural development – correction proposed for deficiencies in the check of the initial application and in the approval of the business plan for the Semi-subsistence farms measure		79.903	79.903
Rural development – correction proposed for weaknesses in sanction system and lack of verification of 100% of parcels for Agri-environment measure		1.922	1.922
Other corrections – correction proposed for unaccounted recoveries found during the financial clearance of accounts for 2010		0.680	0.680
Portugal
Export Refunds and Sugar CMO – correction proposed for weaknesses in the selection of the export declarations for the physical checks		0.031	0.031
Slovenia
Rural development – correction proposed for deficiencies in the administrative checks for the Natural Handicaps measure		0.554	0.554
Slovakia
Rural development – correction proposed for lack of timing of on-the-spot controls and lack of cross checks for livestock verification for the Agri-environment measure		1.139	1.139
Rural development – lack of verification of minimum standards for animal welfare		0.401	0.401
Other corrections – correction proposed for financial error in the EAFRD accounts found during the financial clearance of accounts for 2010		1.764	1.764

TOTAL		229.844	226.738

Annex II : Clearance of accounts of EAGF and EAFRD

Decision 41: Corrections by Sector (In Million €)

Sector	Amount of correction	Amount of financial impact of the correction³

Export refunds	0.031	0.031

Fruit and Vegetables	83.613	83.613

Livestock premiums	43.903	43.327

Area aid	0.092	0.091

Cross-compliance	2.890	2.890

Rural development	95.812	93.884

Other corrections	3.503	2.903

TOTAL	229.844	226.739

¹ :

The financial impact is lower due to amounts already recovered from or paid back by the Member State.

² :

Financial impact of the correction is taking into account the previous overlapping corrections and amounts already recovered by the European Commission

³ :

Financial impact of the correction is taking into account the previous overlapping corrections and amounts already recovered by the European Commission