A total of € 284 million of EU agricultural policy funds, unduly spent by Member States, is being claimed back by the European Commission today under the clearance of accounts procedure. However, because some of these amounts have already been recovered from Member States and there is a reimbursement to Portugal, the financial impact of this decision will be some € 276 million.
Member States are responsible for paying out and checking expenditure under the Common Agricultural Policy (CAP), while the Commission is responsible for ensuring the sound management of EU budget. When the Commission identifies deficiencies in the control system of the Member States, it ensures that amounts unduly paid by Member States are returned to the EU budget.
The amount of this decision should be seen in relation to the overall CAP expenditure which is around € 55 billion per year.
The following Member States are concerned by this latest decision: Bulgaria, Czech Republic, Denmark, Germany, Spain, France, Greece, Ireland, Italy, Latvia, Lithuania, the Netherlands, Portugal, Romania, Slovenia, Slovakia, Sweden and the United Kingdom.
The main deficiencies relate to Land Parcel Identification System (LPIS) which governs all area related payments.
The EU rules governing the CAP also allow the Commission to authorise the reimbursement in yearly instalments. Regarding Greece, which currently is under EU financial assistance, today's decision is deferred for two years. The reimbursement, starting in 2017, will then be made in 5 yearly instalments.
Member States are responsible for managing most CAP payments, mainly via their paying agencies. They are also in charge of controls, for example verifying the farmer's claims for direct payments. The Commission carries out more than 100 audits every year, verifying that Member States' controls and responses to shortcomings are sufficient, and has the power to claw back funds in arrears if the audits show that Member State management and control is not good enough to guarantee that EU funds have been spent properly.
For more details on the audit activities of the Commission and their outcome, see DG Agriculture and Rural Development's "Annual Activity Report 2014".