EU budget review ‘needed to demonstrate value added’

13 Jul 18

The European Commission should have proved the value it was adding with changes to its long-term spending priorities, auditors have concluded. 

In a briefing paper released on Tuesday, the European Court of Auditors warned the Commission had not justified how its May spending review of its 2021 - 2027 budget plan would increase value added.

The bloc published a package of legal proposals and explanatory documents for its new multiannual financial framework - the seven-year budget for the Union - at the beginning of May.

Although, the watchdog noted the Commission had increased flexibility in the budget to deal with unforeseen events, such as a future financial crisis or migration.

Jan Gregor, one of the members of the ECA responsible for the paper, said: “EU value added was identified as one of the guiding principles for the Commission’s reform of spending.

“But the Commission’s proposals are not clearly explained or justified by the Commission’s assessment of the EU value added of spending programmes.”

The report said that the May spending review did not provide a clear assessment of EU programmes, based on the EU criteria for value added, or show a clear overall conclusion on the value for programme spending.

“Readers cannot readily use the information in the spending review to compare or rank programmes in terms of the EU value added they generate,” it said.

It added that the information does not provide much insight to guide future funding decisions by the EU legislative authorities.

On 2 May, when the bloc published the documents and spending review, the commissioner for budget and human resources Günther Oettinger said: “This budget proposal is truly about EU added value.

“We invest more in areas where one single member state cannot act alone or where it is more efficient to act together - be it research, migration, border control or defence.”

The Commission usually allocates money into blocks, such as ‘cohesion’ and ‘natural resources’, which makes it difficult to find money in a hurry for unexpected events, but this time around, the budget is more flexible, the auditors said.

The bloc has now proposed changes to the priorities and structure of the budget, including €63bn less funding for “natural resources and environment”. This includes a 15% cut in funding for common agriculture policy, the ECA said.

The Commission also proposed to raise the level of co-financing provided by member states for rural development programmes.

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