WRITTEN QUESTION E-0985/96 by Luigi Moretti (ELDR) to the Commission (26 April 1996)

Subject: Irregular spending under the EAGGF

Following the clearing of the EAGGF accounts for the 1992 financial year by the Commission, the Member States must reimburse the EU for ECU 787 million in irregular expenditure.

Although the Directorate-General for Agriculture is responsible for checking the Member States' inspection systems, according to Commissioner Fischler the Commission 'does not have the necessary means to keep order when EU legislation is not observed', and in any event it is the duty of every Member State to ensure the legitimate use of taxpayers' money.

How does the Commission consider it can punish Member States that cannot ensure that Community funds are managed properly?

Does the Commission intend to set up monitoring committees?

What measures does the Commission intend to take to ensure that the EU's financial interests are better protected?

Answer given by Mrs Gradin on behalf of the Commission (3 June 1996)

On the specific item of penalties applied to Member States that cannot ensure the proper management of Community funds, the Commission would first point out that, for all sectors, it may bring the matter before the Court of Justice (Article 169 of the EC Treaty) which may impose a lump sum or a penalty payment if the Member State concerned fails to take the necessary measures to comply with the Court's judgment (Article 171 of the EC Treaty).

As far as the European agriculture guidance and guarantee fund (EAGGF) - guarantee section is concerned, the legislation, which includes a system of disallowing finance, has recently been modified ((Council Regulation (EC) no 1287/95 (OJ L 125, 8.6.1995) and Commission Regulation (EC) no 1663/95 (OJ L 158, 8.7.1995) )), notably in order to introduce a more preventive approach. Member States are required to accredit the paying agencies offering sufficient guarantees (admissibility of claims and compliance with Community rules, correct and full record of the payments effected, submission of the necessary documents within the time and the form laid down in Community rules). Moreover, annual accounts of paying agencies have to be accompanied by an attestation regarding the integrality, exactitude and veracity of the accounts transmitted.

The Commission would finally underline that both it and the Court of auditors carry out checks and controls.

The Commission does not intend to create a new committee in the area of the protection of the financial interests of the Community. For EAGGF - guarantee expenditure, committees already exist (EAGGF committee as well as EAGGF working party on irregularities and mutual assistance). In addition, the advisory committee for the coordination of fraud prevention was set up in 1994 ((Commission Decision 94/140/EC; OJ L 61, 4.3.1994 )), covering all horizontal aspects.

As stated in its 1996 anti-fraud work programme ((COM(96) 17 final, 31.1.1996 )), the Commission's strategy to protect the financial interests of the Community is currently being further developed. This includes initiatives to achieve stronger presence on the ground, closer partnership between the Commission and the Member States, improvement of Community legislation as well as greater compatibility between legislation of the Member States.