WRITTEN QUESTION E-2561/01 by Michiel van Hulten (PSE) to the Commission. Problems detected in connection with implementation of the ESF during the periods 1994-1996 and 1996-1999.
Date: 2001-09-20
Institutions: European Parliament, Provisional data
Subjects: European Commission, European Social Fund, application of EU law, fraud against the EU, management, sanction (EU)

C 134 E/48

Official Journal of the European Communities

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6.6.2002

On 17 November 2000, the Community presented to the WTO both the request for suspension of
concessions and the request for consultations as the first step in the panel procedure. The WTO panel
ruled on 20 August 2001 condemning the FSC replacement legislation. On 15 October 2001 the US, as is
its right under relevant WTO provisions, appealed this ruling before the WTO Appellate Body. The
Appellate Body is expected to rule within 90 days from the date of the appeal.

the end of

the panel procedure,

the arbitration procedure examining whether the amount of
At
countermeasures requested by the Community is appropriate will be automatically reactivated.
It is,
therefore, for the WTO arbitrators to fix the amount of the countermeasures the EC can finally impose on
i.e. $ 4 000
the US which cannot be higher than the amount initially requested by the Community,
millions.

In light of the above, it can be clearly seen that the Commission has not waived any rights under the
WTO. As said before, the WTO Appellate Body will review the panel ruling and, if the ruling is confirmed,
the final amount of countermeasures the Community might be entitled to will be fixed by the arbitrators.
However, the Commission continues to expect that the US will comply with the WTO rulings.

(2002/C 134 E/050)

WRITTEN QUESTION E-2561/01

by Michiel van Hulten (PSE) to the Commission

(20 September 2001)

Subject: Problems detected in connection with implementation of the ESF during the periods 1994-1996

and 1996-1999

Could the Commission indicate the number of irregularities detected in connection with the use of
1.
ESF funds, together with the relevant amounts, for each Member State,
in respect of the 1994-1996
programming period? Have steps been taken in each of these cases to recover the money? If not, why not?

2. With regard to the cases referred to under 1 above, has the Commission produced an extrapolation,
on the basis of irregularities detected, for the whole of the programming period 1994-1996, or does it
intend to do so? If so, how many cases are concerned, and in which Member States? What is the size, in
each instance, of the sample on the basis of which an extrapolation has been made? What amounts have
been sought to be recovered? Which Member States are concerned? Have the amounts sought to be
recovered actually been paid back to the Commission?

3. With regard to the cases referred to under 1 above, has the Commission made proposals to the
Member States in respect of an arrangement? If so, in which cases? And on the basis of what criteria?

4.
Has the Commission detected irregularities which have not led to a claim for recovery in respect of
the Member State concerned? If so, could the Commission indicate the cases concerned, for each Member
State, and the amounts involved?

5.
Does the Commission take the view that, with the exception of the cases where steps have been
taken to recover funds, all ESF projects carried out during the period 1994-1996 were carried out to the
letter of the rules in force?

Could the Commission also reply separately to the above questions in respect of the 1996-1999

6.
programming period?

Answer given by Mrs Diamantopoulou on behalf of the Commission

(6 November 2001)

1.
Irregularities in the implementation of the European Social Fund (ESF), which co-financed many
thousand of projects all over the Community to the tune of on average € 7 000 million a year in the
period 1994-1999, are found in all Member States. Corrective actions are prepared in partnership with the

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Official Journal of the European Communities

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Member States. When the Commission and the Member State in question are in agreement on the
corrections to be made, the Member State integrates the necessary corrections into its annual declaration of
expenditure. Consolidated data on such corrective actions by the Member States are not available. When
the Commission and the Member State cannot reach an agreement on the necessary correction, the
Commission launches a procedure for financial correction pursuant to Article 24 of Council Regulation
(EEC) No 4253/88 (1). The most recent report on financial corrections in the context of the application of
Article 24 is transmitted direct to the Honourable Member and to the Secretariat general of the Parliament.
In all cases where the recovery of ESF support was necessary, steps have been taken to do so.

Pursuant to Commission Regulation (EC) No 1681/94 (2), the Member States have to report quarterly to
the Commission any irregularities which have been the subject of
initial administrative or judicial
investigations, and the recovery of sums wrongly paid. Up until 31 December 2000, the Member States
have communicated the following data with regard to ESF operations for the programming period
1994-1999:

Member State

Number
of cases

Currency

Community Expenditure
(EC)

Amount to be recovered

B

DK

D

GR

E

F

IRL

I

L

NL

AT

P

FI

SE

UK

9

14

69

86

324

357

8

73

0

50

1

50

12

41

66

BEF

DKK

DM

GRD

ESP

FRF

IEP

ITL

LUF

NLG

ATS

PTE

FIM

SEK

GBP

1 797 146

2 705 774

1 797 146

230 114

47 007 610

45 585 871

984 632 774

365 379 878

2 320 553 148

1 592 260 505

88 711 381

69 248 351

465 407

449 532

10 532 532 397

8 767 299 837

0

0

11 572 002

7 471 068

0

0

1 500 803 177

1 037 445 045

1 463 544

20 652 988

25 603 976

1 126 752

8 309 294

14 683 750

2. When the Commission considers that irregularities found in a sample of projects reflect a systemic
weakness in management or control systems, this justifies a correction beyond the individual irregularities
discovered. In six other ESF-related cases, extrapolation has been used to determine the amount of the
correction (Member States concerned are Belgium, France, Ireland twice, the Netherlands with respect to
1997, Portugal). All these cases concern the programming period 1994-1999. In each of these cases, the
necessary corrective actions have been or are being undertaken by the Member States involved.
Consolidated data on such corrective actions by the Member States are not available.

The Commission has not made proposals to the Member States in respect of an arrangement. In all

3.
cases, corrective actions are taken to fully safeguard the financial interests of the Commission.

4.
In the case that the Member State undertakes all necessary corrective actions and integrates them in
their annual declaration of expenditure, the irregularities do not lead to a financial correction by the
Commission in application of Article 24. In all other cases, the necessary steps are taken to recover the
funds.

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In the framework of the partnership,

5.
management and control systems implemented by the Member States.

the Commission has, to a great extent,

to rely on the

According to Article 23 of Regulation No (EEC) 4253/88, the Member States should take the necessary
measures:

D to verify that operations have been properly carried out;

D to prevent and to take action against irregularities;

D to recover any amounts lost as a result of an irregularity or negligence.

The financial control
throughout all Member States has been further strengthened by Commission
Regulation (EC) No 2064/97 (3). In accordance with Article 8 of this Regulation, all Member States will
have to certify the validity, the legality and regularity of the operations underlying the final declaration of
expenditure for the programming period 1994-1999.

Irregularities found after controls by the Commission lead to corrective actions by the Member State or to
a financial correction by the Commission in application of Article 24 of Regulation (EEC) 4253/88.

Given the number of projects receiving ESF support throughout the Community and despite the controls
carried out by the Member States and the Commission, the Commission is not in a position to give
complete assurance that all ESF projects that were not subject to controls, comply fully with all the rules in
force.

6.

The aforementioned answers apply to the programming period 1994-1999.

(1) Council Regulation (EEC) No 4253/88 of 19 December 1988, laying down provisions for implementing Regulation
(EEC) No 2052/88 as regards coordination of the activities of the different Structural Funds between themselves and
with the operations of the European Investment Bank and the other existing financial
instruments OJ L 374,
31.12.1988.

(2) Commission Regulation (EC) No 1681/94 of 11 July 1994 concerning irregularities and the recovery of sums
wrongly paid in connection with the financing of the structural policies and the organization of an information
system in this field, OJ L 178, 12.7.1994.

(3) Commission Regulation (EC) No 2064/97 of 15 October 1997 establishing detailed arrangements for the
implementation of Council Regulation (EEC) 4253/88 as regards the financial control by Member States of
operations co-financed by the Structural Funds, OJ L 290, 23.10.1997.

(2002/C 134 E/051)

WRITTEN QUESTION E-2579/01

by Jules Maaten (ELDR) to the Commission

(24 September 2001)

Subject: Environmentally harmful subsidies, with particular reference to road transport and energy

1.
Environmentally harmful subsidies are those granted with a particular objective, often unrelated to
the environment, but which may have unintended negative side-effects on the natural and social
environment. A study by Van Beers and De Moor (Public Subsidies and Policy Failures. How Subsidies
Distort the Natural Environment, Equity and Trade, and how to reform them, Edward Elgar Publishers,
Cheltenham, UK, 2001) shows that environmentally harmful subsidies are a widespread phenomenon in
the road transport sector. These include in particular fuel prices which are too low, public expenditure on
the construction and repair of new roads and bridges, failure to levy parking charges, and a lump sum
payment for travel to work by car. Does the Commission have a sufficient overview of these hidden
environmentally harmful subsidies?

Is the Commission prepared to carry out detailed studies on hidden environmentally harmful

2.
subsidies in the transport sector?