There is a "question mark" over the legality of how EU funds are spent, Edward Leigh has said following a report from the National Audit Office.
The chairman of the Commons public accounts committee made the comments after European auditors raised concerns about EU accounts for the 12th year running.
Reporting to Parliament on the financial management of European spending, the NAO said that European auditors had found "some errors" on the balance sheets.
Leigh acknowledged there was "some evidence" that the financial management of the funds was improving.
But he added: "The fact remains that, for the 12th year in succession, the European auditors have placed a question mark over the legality and regularity of European Community expenditure.
"And cleared accounts still seem a distant prospect."
Calling on the government to "keep the pressure up" to ensure other member states increase scrutiny, he said it was vital for taxpayers to "have a clear sight of how the EU funds being spent in their countries".
The European Court of Auditors concluded there had been "material errors", but considered most transactions relating to revenue and administration "legal and regular".
In 2005, there had been progress in some areas, such as agriculture payments, they noted.
But they also reported that the Anti-Fraud Office recorded over 12,000 irregularities - including suspected fraud - totalling around €1bn.
This represents a 5.3 per cent rise from 2004.
Examining what the report means for Britain, head of the NAO Sir John Bourn said there had been some problems in relation to Customs checks and flock registers.
He commended the use of accrual accounts for 2005 as "a considerable achievement".
However, Sir John warned that the proposal for the UK to publish a statement of assurance in the use of EU funds "remains a significant challenge for the future".
