Euros: Going to waste?

Parliament's spending watchdog has expressed concern that European Union financial accounts have been qualified by auditors for the tenth year in succession.

Auditor General Sir John Bourn said the government should use its presidency of the EU in the second half of this year to push for further improvements.

However, the National Audit Office report said that some progress was being made by the European Commission.

Reviewing the findings previously set out by the EU's own Court of Auditors, the British watchdog said in 2003 the accounts were only of questionable reliability in one area compared to four in the previous year.

However, the Commission's accounting system was said to be subject to weaknesses which mean it cannot record all its assets.

Errors

The Court of Auditors qualified its opinion on the payments for the common agricultural policy, structural funding, internal policies, external actions, and pre-accession aid.

Member states, though, were responsible for the majority of errors found.

"While I am concerned that the Court has qualified its opinion on the accounts of the European Union for the tenth year in succession, I am pleased to see that the Commission has made progress in a number of areas," said Sir John.

"For example, the new accruals based accounting system introduced on January 1, 2005 presents a good opportunity to move towards an unqualified opinion. 

"I am also pleased that the Court was able to identify progress with regard to other aspects of improved financial management, which the Commission seems intent to build on."

He added that the UK's presidency should be used to "push for improvements in the financial management of the European Union".

"We will continue to work closely with European institutions and the state audit institutions of the 24 other member states to protect European Union funds and to bring about the necessary changes to improve financial management," Sir John added.