EU budget: Auditors urge reform of spending

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image captionErrors were found in budget management both nationally and in the EU Commission

Independent auditors say the EU needs a "wholly new approach" to investment and spending, in a report on the bloc's 2014 budget.

The European Court of Auditors (ECA) gave the budget a clean bill of health overall, but found that 4.4% was mis-spent - the budget "error rate".

The European Commission says most "errors" take place at national level, where 80% of EU funds are managed.

The €142.5bn (£101bn) spent in total was about 2% of all public spending.

The ECA's criticisms were sharper in tone than in previous years, BBC Brussels reporter Alex Forsyth says.

"The EU must invest its money better," said ECA President Vitor Caldeira.

"It must ensure its investments match its priorities more closely, simpler rules are framed."

As in previous years, the biggest spending areas were agriculture and rural development (€57.5bn) and cash for poorer regions, known as "cohesion" funds (€55.7bn).

Unspent cash

The auditors said too much EU money remained unspent after being allocated to member states which lacked the capacity to make good use of it.

The budget must also be made "more responsive in a crisis", they said.

During this year's migrant crisis EU member states have struggled to send resources to where they are urgently needed. Pledges for the border agency Frontex, for example, were not fully met.

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image captionHigh-speed broadband is a priority area for EU investment

The ECA says EU budget spending represents about €300 per EU citizen.

By "errors" the ECA means spending that violated EU rules - but it is not a measure of fraud or waste. Some of it was clawed back by the EU Commission.

The Commission drafts EU laws, enforces EU treaty rules and co-funds many projects with member states.

Sometimes EU public procurement rules are broken - amounting to a spending "error". Despite that, a project - for example a new bridge - may still be completed with EU funds.

"Out of the some 1,200 transactions that we assessed for legality and regularity during the 2014 audit, we found 22 instances of suspected fraud (2013: 14), which we forwarded to Olaf [the EU anti-fraud agency]," the ECA said.

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