EU's 'Tolerable Risk' is Intolerable
The EU's regional funds budget is one of the biggest. In an average year there are some 700,000 recipients of public funds all over the 27 nation states. The Court of Auditors claimed at a recent meeting of the Budget Control Committee of the European Parliament that they had audited 180 such transactions - barely 0.03 percent - during the audit of the 2007 accounts.
They found an 11 percent error rate on this tiny sample. In itself, 11 per cent is an unlikely figure, since it means 19.8 of the sample showed mistakes. Either it was 19 or it was 20. It cannot have been 19.8.
The Court of Auditors also told the committee that the errors they found included incompetence, honest mistakes and fraud, but it was not a matter for the Court to decide. Any fraud issues should be investigated by OLAF, the European Commission's in-house financial police force.
But OLAF has been accused of corruption itself, ever since it was set up. In more than a decade, OLAF has never successfully prosecuted a case in court and then recovered the missing public funds.
Statisticians may think a sample of 0.03% gives a reliable indication of a trend, but I remain to be convinced.
Meanwhile, the Commission's target of a "tolerable level of risk" of four percent gathers support amongst EU aficionados as an easy way out of an insoluble problem.
Not for the first time, and despite my being a full member of the committee, the chairman managed to run out of time before giving me the floor on the regional funds debate. This is what I planned to say:
"There is no 'tolerable level' of error - whatever its cause. That is the soft approach to mistakes of all kinds. Even small percentages, when multiplied by the size of EU government, become big numbers. And these increases tend to be logarithmic - the square rather than the sum.
In reality, 'tolerable error' attempts to define the difference between genuine individual mistakes and weaknesses in the system. It is an impossible task.
The essence of successful statesmanship ought to be based on the political theory of holes. When in a hole, you stop digging. Sadly, the European Commission in general, and Mr Kallas as its protector of the public purse in particular, have yet to understand that lesson."
None of which eases the situation in which hard-pressed taxpayers find themselves, especially in the present economic climate.
(ends)
To respond to, or comment on this Email, please email ashley.mote@btconnect.com
Posts
