Euros - CC / Flickr

Ho, ho, here we go again. A question posed in the House of Commons by Philip Davies (Con) as cited by the Open Europe blog:

Given that the accounts of the EU have not been signed off by the auditors for 15 years running, why do the Government keep giving more and more money to the EU? Surely if the Government are serious about reform of the EU budget, they should say that the EU will not get a penny more from the British Government until it gets its accounts properly audited.

This has become a familiar meme for the Tories on Europe – the EU doesn’t sign off its books, therefore this is a good reason for not cooperating with the EU, not giving it more cash, bla, bla. Cameron even mentioned it in one of his speeches at Tory Party Conference.

So here you are Mr Davies, you who claims at the top of your website to not represent ‘self-interests’, here’s why your question, and the Tory line, is a load of rubbish, and here’s also what the Tories (and indeed anyone else) should do about it.

Firstly, the European Union budget is complicated. Most of the money gets transferred from the European Commission to bodies in the Member States at national or regional level, and these bodies spend the cash. Tracing every last Euro down to every last farmer or training project is a very hard task. And don’t assume this is just something those evil ones across the Channel do – the UK experience is not good on this either.

Secondly, no equivalent budgetary sign off exists in the UK, so it’s not as if the UK is perfect and Brussels is bad. Quoting the Select Committee on European Union Fiftieth Report on the matter:

149. Sir John Bourn, Comptroller and Auditor General at the UK’s National Audit Office told us that, were he required to issue a single Statement of Assurance on the UK Government’s accounts in the same way as the Court of Auditors does for Europe’s accounts, he, like the Court, would be unable to do so (Q 192). This is because last year he issued a qualified opinion on 13 of the 500 accounts of the British Government which he audits.

In short, is the EU budget perfect? No. Is any national government any better? No, probably not, and at least the UK’s is not.

So stop using that as a stick to bash the EU.

So then Mr Davies, Open Europe, hell, even Alistair Darling – you want to do something about this? What you should do is to argue that the European Commission needs at least 1000 additional, new auditors who will spend all of their time digging around in the books of each of the Member States and their regional and local governments, digging up fraud and wrongdoing wherever they find it.

But of course if you’re a Tory you’re never going to go for this either, because then you would have a whinge that EU auditors having a look into the UK’s books would be some infringement on the UK’s national sovereignty, that they would be public sector workers and Tories want a small state etc., and ooh, of course a UK government run by that nice Mr Cameron would never do anything remotely questionable, would it now…?

How would that place Intel as a member state? If we look at line by line of the 2009 budget [PDF, Table 6, total own resources column] a €1.06 billion payment actually would make Intel the 18th highest contributor to the EU budget – Bulgaria, Estonia, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Malta, Slovenia and Slovakia each pay less each year into the EU budget than Intel will have to do with this one fine.

Time for them to have some representation in the Council of the EU and the Parliament if they are such a net payer?

[UPDATE 15.05.2009]
Saw this at Brussels Airport yesterday… The real one says ‘innovation’!

Intel - Collusion in Europe - J. Worth, CC Share Alike Attribute License

Euros - CC / Flickr

I happened to catch a few moments of PMQs today, and Alan Beith asked a question about how EU funds were being denied to the North East, while Wales, Scotland and Northern Ireland were still eligible for the same funds, essentially unused cash from the European Commission £178bn economic stimulus package. The press release about the issue is on Beith’s website, and also on the website of Fiona Hall, Lib Dem MEP in the North East. However both PRs are vague and tub-thumping in their tone, and make no effort to explain what’s actually going on.

I’m quite sure Brown understands what’s going on, as in his reply he cited the European Investment Bank and their loans for car companies in the North East – i.e. something else altogether.

I reckon all of this is another example of the UK government not wanting to take any money from the EU budget because it makes the UK Treasury’s budget position worse. I posted about this at length (1, 2, 3) last summer when it came to why the UK was not applying for money from EU flood aid funds. Essentially the more the UK gets from the budget each year, the less money the UK gets back from its budget rebate. So the times when EU funds are actually directed at something useful, the UK does not apply as it thinks of trying to balance the national books first.

Of course Beith and Hall don’t say it straight either, because if they stated that the rebate has passed its sell-by date and the EU budget needs fundamental reform then they would have the Daily Mail attacking them for selling out… Ho, hum, what joy the ‘debate’ in Britain about EU matters.

• NEW – Helga Truepel MEP is now on the warpath on this one, having written a press release on the issue (EN | DE) demanding clarifications from the UK government, and she’s also written a letter (PDF file here) to the chair of the EP’s Budgets Committee, Reimer Böge, demanding action – including inviting John Healey to Budgets Committee. Oh, that would be fun!
• The Yorkshire Post has printed a new article on the topic, citing Richard Corbett’s critique of what’s going on. Corbett’s line is completely right – the Treasury is at fault, and I do wonder whether Healy was correctly advised. HMT after all thinks it’s the only reasonable economic ministry anywhere in Europe – I would beg to differ.
• Neither of the other Labour MEPs potentially implicated in this – Linda McAvan (Corbett’s colleague in the North West) or Glyn Ford (South West) have said anything about the matter. Not much of a surprise I suppose, even though McAvan is a member of the EP’s environment committee. Glyn Ford’s website doesn’t even seem to have a functioning news function.
• Graham Watson, Lib Dem MEP for the South West, has commented on the mess, as reported by the Aberavon & Neath Lib Dems.
• The Ulster Unionists also have a position on this – demanding the Northern Ireland gets its full share of the money. Well, of £31 million I suppose?
• There’s an interesting theory of why the government had to take this action in the comments on my previous post.

Let me also make this clear: whatever you think of the UK’s budget rebate (for the record: I hate it) and whether the flood hit regions should get £31 million or £110 million (for the record: I want them to get £110 million), one thing is crystal clear in all of this: the decision to reduce the payment from from £110 million to £31 million was taken by the UK Government – the Treasury – and not by any bureaucrat, politician or official in Brussels.