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EU: Governments warned over accounting for EU funds

The European Union executive threatened on Tuesday to take several of the bloc’s members, including Germany and Austria, to court over their failure to account properly for their spending of EU funds.

The European Commission said the two countries had not sent it summaries of the available audits and declarations of how the EU’s regional development funds were spent in 2007, the first year for which such a procedure is required. And incomplete information had been sent by the Czech Republic, Greece, Ireland, Luxembourg, Spain and Belgium, Commission spokeswoman Eva Kaluzynska told a daily news briefing. “If they do not respond, they will face the possibility of the infringement procedure and we will not hesitate to use it,” she said, referring to lawsuits at the Luxembourg-based European Court of Justice.

The countries have a month to respond. The court can impose hefty fines on countries, that breach EU laws. Until this year, EU governments had provided the Commission with only limited accounting evidence of how they spend regional aid funds, which make up one-third of the 27-nation bloc’s €120 billion ($176.7 billion) annual budget. This lack of transparency and proper audits has led the EU’s budget watchdog, the European Court of Auditors, to refuse a clean bill of health to the bloc’s budget for 13 years in a row, giving powerful arguments to opponents of EU integration.

Pressed by the Commission, EU governments agreed last year to provide clearer evidence of how the funds are spent on projects such as motorway construction, environmental clean-ups and industrial overhauls. Kaluzynska said Austria and Germany had disputed the Commission’s methodology on exactly what information had to be provided. (Reuters)