EU accounts fail audit for 19th year in a row

For the 19th year in a row, the EU’s Court of Auditors has refused to give a clean bill of health to the EU’s accounts for the year ending 31st December 2013. The EU’s Court of Auditors registered an ‘adverse opinion’ about the legality and regularity of EU payments, blasting them as being “materially affected by error” – with almost €7 billion being paid out improperly.

With multinationals claiming small business relief, farms claiming buildings as grazing land and officials pocketing 5 times the going rate for their jobs, I wonder whether people realise just how bad the situation is in terms of mismanagement of the EU’s funds – at a time when Britain is being asked to hand over an additional €2.1 billion to the European Union within weeks?

The official error rate is 4.7% for 2013 (with rural development and regional policy completely out of control at almost 7%), roughly holding steady after a huge increase the previous year.  In actual fact, errors are higher – around 6.3% of the budget – but 1.6% had been rectified.  At today’s Budgetary Control Committee meeting in the European Parliament, I was handed a copy of a monster 319-page report.  It was the Court of Auditors’ annual report on the financial year 2013 – available online athttp://www.eca.europa.eu/Lists/ECADocuments/AR13/AR13_EN.pdf

So far I’ve picked out just a few of the most shocking pieces of information from that document.  Bear in mind that these (and 14 further cases of fraud) have been found in a small sample of all EU projects:

  1. EU money spent on IT equipment in Africa was claimed to have been given to the lowest bidder, but that just wasn’t true.  The Commission’s auditor didn’t even spot the problem. (p206)

    2.  A legal training firm claimed using incorrect hourly rates, claiming subcontracting costs as though they were regular employees, and declaring costs for periods of time that weren’t part of the project. More than a quarter of such projects had illegible costs. (p221)

    3.  The Commission signed a contract for a French legal expert, who was paid 98,000 euros for advisory service in Tunisia, in breach of the financial regulations. (p207)

    4.  The Commission accepted millions of foreign aid expenditure to Moldova which hadn’t actually been incurred. (p207)

    5.  In Romania officials were paid 5 times the usual salary, but no action was taken because the rules were unclear. (p185)

    6.  Illegal awards were made under the Regional development fund in Germany and 5 other countries.  (p148)

    7.  In Latvia the body responsible for checking that EU aid is genuine itself claimed €2 million in ineligible aid (p118).

    8.  In Poland, a farmer was given payments for early retirement support despite being of pension age (p114).

  2. Multinational companies in Portugal claimed €500,000 of EU aid aimed at small businesses. Similar problems were found in FIFTEEN other countries (p112; p25, EU Audit in Brief).

    10.  An Italian company was paid not to use harmful plant protection products, but it used them at least twelve times. (p112)

    11.  In 10,000 cases in Italy aid was granted for land which was excluded from such aid (p89).

  3. In Ireland, farms claimed subsidies for grazing land.  Some so-called ‘grazing land’ had buildings and roads built on it, and couldn’t possibly be used for grazing.  This was found in four out of the six farms randomly surveyed (p88).
  4. In Greece and 5 other countries land covered in trees, shrubs and bushes was claimed as grassland (p84).

    14.  Errors in French and British trade with Germany have been simply ignored for 15 months (p64).

    15.  In Holland, 90% of monies involved in fraudulent activity in textile imports haven’t been reclaimed (p63).

Defenders of the European Union usually point to the fact that a lot of money is spent in the member states, and say that it’s the member states’ responsibility to police the problem.   They act as though the Commission is a blameless victim of national governments’ incompetence.

Well that was certainly true today!  Speaker after speaker on the Committee lambasted national governments for not doing more.  They’re probably right that national governments don’t police EU funding well enough, but it’s also fair to say that they’re the ones bearing the brunt of having to interpret complex EU rules.

But the Commission also routinely ignores instructions from the Court of Auditors.  For example (p70), the Court of Auditors criticised them for ignoring last year’s recommendations for improvement.  The Commission declined to even comment.  In fact 21% of all of the Court of Auditors’ recommendations (p17, EU Audit in Brief) were completely ignored by the Commission, and many others were only partly implemented.

But whilst they’re aiming their bullets at national governments, is the record of the European Union itself really okay – or are they just seeking to deflect criticism?  For projects directly administered by the Commission, the error rate is still 3.7%.  Yes, it’s a tiny bit lower than the overall error rate but that’s to be expected because there’s one less tier of administration.  So when the pro-EU lobby blames member states, they’re doing nothing more than using it as a way to muddy the waters.  The fact is that the system itself is broken and unreformable.  There’s even a 1% error rate within the EU’s own expenditure.

The EU’s budget will always be mismanaged; the system and procedures are so complex that they are open to large-scale abuse and fraud.  Far better, surely, not to send money to Brussels in the first place and then apply to receive a small portion of that money back with strings attached?  We want to be good neighbours with Europe and to trade freely with Europe, but outside the EU trading freely with the globe.  European government does not work, will not work and can never work.

Labour’s Ronnie Campbell cosying up to big business, says UKIP’s Jonathan Arnott MEP

Labour’s MP for Blyth, Ronnie Campbell, is cosying up to big business, whilst ‘neglecting the people who pay his wages at the end of the month’, according to Blyth’s UKIP Euro MP, Jonathan Arnott.

Mr Campbell said he ‘looked forward’ to working with the French government owned organisation, EDF ER, after the company acquired rights to develop the Blyth offshore wind demonstration project.

The project has the potential of seeing 15 wind turbines erected, up to 195m tall, meaning each turbine could be at least nine times the height of the North East landmark, the Angel of the North.

Arnott said “From this we can clearly see that Mr Campbell supports lavish ‘green subsidies’ which are given out to over-powering corporations and wealthy land owners, such as David Cameron’s father-in-law, to build and develop even more hugely inefficient wind turbines in the future.

“Campaigners say 6 million families are already in fuel poverty, with the figure set to hit 9 million by 2016.  By supporting this project, Mr Campbell is only adding to the pressures that families and pensioners across the country will face for winters to come.”

A recent study by the Adam Smith Institute and the Scientific Alliance found that, on average, wind farms produce 80 per cent of their potential power output for less than one week annually – and they manage 90 per cent output for only 17 hours a year.

Ben Southwood, Head of Policy at the Adam Smith Institute, said: “Wind farms are a bad way of reducing emissions and a bad way of producing power.

“They are expensive and deeply inefficient and it seems like they reduce the value of housing enormously in nearby areas”.

Arnott added “It’s inevitable that more expensive energy bills will destroy more job opportunities locally than they’ll create.”

Scrap subsidies for new wind farms

The UK should stop giving new subsidies for wind farms, according to UKIP’s North East MEP, Jonathan Arnott.

The call comes following the news that the anti-wind farm, Middleton Burn Action group, were barred from the premises of a public exhibition by a wind farm developer.

The community organisation were barred from the building where the organisation’s exhibition was set to take place, with the company claiming that some of its ‘large’ members had previously acted in an intimidating fashion.

The group has dismissed the accusation and slammed the company’s decision to bar the group from the property, maintaining it will take up a place outside the venue.

Arnott, UKIP’s local Euro MP, said “Taxpayers are still paying vast sums on top of their electricity bills to fund wind turbines across the UK. These subsidies, given to wealthy landowners and big corporations, have a devastating effect on pensioners and low income families in our region who will face the stark choice this winter between heating and eating.”

Middleton Burn Ltd is proposing to erect fourteen 125m turbines at its site in Belford, Northumberland.

The turbines would be six times the height of the Angel of the North.

Arnott added “By driving up energy costs, reducing competitiveness and deterring investment, a recent report highlights that for every one ‘green job’ created, four are destroyed elsewhere in the economy. Wind turbines are a hugely inefficient energy source which the taxpayer simply doesn’t get value for money from. We should scrap subsidies for wind farms at the earliest opportunity.”

The Labour MP for Hartlepool is treating voters with contempt

Iain Wright MP has treated the people of Hartlepool with complete contempt by voting against the proposed amendment to the MPs recall bill, according to UKIP’s North East Euro MP, Jonathan Arnott.

The statement comes following the recent vote on Monday in the House of Commons in which MPs rejected the amendment by 340 to 166.

Under the government-backed plans there would only be a by-election if 10% of constituents signed a petition after the sitting MP is either sentenced to more than 12 months in jail, or banned from the Commons for more than 21 days.

Mr Goldsmith, MP for Richmond Park and North Kingston, however, had created a rival plan in which MPs would face a recall referendum if 5% of voters in a constituency sign a “notice of intent to recall”, and 20% then sign a “recall petition”.

Arnott said “It is blindingly obvious the reason Mr Wright, along with majority of the house, voted against this bill – because they have zero trust in the electorate.  He is once again proving that he is only in politics for himself and has no regard for the concept of democracy”.

Labour’s shadow justice secretary, Sadiq Khan, said the Labour Party wouldn’t vote for a system that could give vested interests power to kick out MPs simply because they dislike the way a politician has voted on controversial issues.

Arnott, who has his office based in the town, added “The people of Hartlepool have voted for Labour years, and consistently they’ve been let down like a cheap pair of braces. If the people of Hartlepool feel that their MP has let them down – they should have the ability to kick them out and choose someone else. The people are the bosses of politicians, the people pay the politician’s wages, and politicians need to realise they should be putting the people’s best interest to the top of their agenda.”

EU’s demands for UK to pay additional £1.7bn is ‘outrageous

The EU’s demands for UK taxpayers to cough up an additional £1.7bn is ‘outrageous’ and the leadership of the Conservative Party is in ‘complete disarray’ according to UKIP’s EU budget spokesman, Jonathan Arnott MEP.

EU Chiefs plan to charge an additional £1.7 billion from UK taxpayers on the back of the UK’s better than expected economic performance in recent years.

Meanwhile, Syed Kamall, leader of the Conservatives’ MEPs, admitted this morning that Treasury officials may have known about the EU’s new demands a week ago.

Since then, Cameron told his MEPs to vote in favour of the EU’s new unelected commission, their whips overruled him and said to abstain, whilst still more MEPs voted against.

Arnott said “This farce would be as big a comedy of errors as Ed Miliband’s Party Conference speech if it weren’t so serious. Cameron broke his promise on the Lisbon Treaty, his much-trumpeted ‘budget cut’ was actually just a below-inflation rise, he failed to stop Juncker becoming Commission President and his EU ‘renegotiation’ hasn’t removed a single stroke of a pen from a single EU law. Now hard-pressed British taxpayers are being expected to cough up yet another pile of cash that we can’t afford. Cameron is out-manoeuvred at every stage by the European Union, and it’s our taxes that foot the bill”.

Eurocrats have recalculated national payments to the EU based on economic performance since 1995. Whilst the UK pays money to the EU, Germany and France are due to receive nearly £1.6bn between them.

It would add about a fifth to the UK’s annual net contribution of £8.6bn.

“It’s Alice in Wonderland stuff”, Jonathan Arnott continued. “Our ‘economic recovery’ is invisible in the North, yet we’re supposed to send cash to France. And Greece and Italy, in economic meltdown, are being expected to subsidise Germany. And these figures, backdated to 1995, are based on the EU’s estimate of illegal activities like drug dealing, which never gave the Exchequer a penny piece. The phrase ‘you couldn’t make it up’ has never been more apt.”

Time for a sensible discussion on e-cigarettes

Hundreds of thousands of people have managed to quit smoking cigarettes and moved on to e-cigarettes instead.  It’s pretty obvious that, although e-cigarettes aren’t exactly as healthy as quitting smoking altogether, in comparison they will drastically reduce the risk of the various health issues associated with smoking.

I wouldn’t object to a certain regulation of the e-cigarette industry; in much the same way as food and drink are regulated it’s important that consumers know what is in them and in what quantities so that they are able to make an informed choice.  It’s also a good idea to ensure that whilst they exist, they’re produced in such a way as to minimise any health risks.  On the other hand, the European Union Directives expect e-cigarettes to be classified as medicines and over-regulated accordingly, putting a lot of smaller firms out of business.  Phrases about sledgehammers and nuts spring to mind.

Research published in the Addiction journal shows that “people attempting to quit smoking without professional help are approximately 60% more likely to report succeeding if they use e-cigarettes than if they use willpower alone or over-the-counter nicotine replacement therapies such as patches or gum”.  We should be supportive of the e-cigarette industry not opposed to it.

In the Parliament’s Budgetary Control Committee there was a fascinating discussion about counterfeit cigarettes and smuggling.  There’s a huge problem with counterfeit cigarettes being smuggled into the UK and elsewhere; the EU’s proposed plain packaging would be a counterfeiter’s dream.  I’d never realised before that Committee that there’s also an issue with so-called ‘ant smuggling’, where people cross land borders into Europe a number of times a day bringing a relatively small (say, a thousand cigarettes at a time) number of cigarettes across.  It’s not an issue for the UK, but it is for much of the rest of Europe – another example of why a one-size-fits all approach doesn’t always work.

I’ve never smoked a cigarette in my life.  I think I’d probably find I enjoy it, and I certainly don’t want to get addicted to cigarettes.  So I’ve done the responsible thing and never smoked.  Neither have I ever smoked an e-cigarette, so I have no axe to grind here.

I grew up in smoke-filled rooms (not the kind in which political parties made deals – I played chess to a decent standard, making the England Under-21 squad, and was regularly competing against adults in club matches from about the age of 7).  It was the League which acted first, long before the law, to ban smoking during matches.

The difference between then and now could hardly be starker.  No-one should be suggesting that we should go back to how things were in the 1980s and 1990s; for those who were in that environment on a daily basis I would find it difficult to believe that there wasn’t a serious danger attached to passive smoking.

Now, of course, Boris Johnson wants smoking banned in Hyde Park.  In such an open-air environment, where is the health risk to anyone other than the smoker?  And surely, if we drive those people to smoke indoors with poor ventilation, there will be a greater risk to their own health and that of their families.