Commission sets cap on payment errors

No need to introduce tougher controls in a bid to reduce ‘errors’ in EU-funded projects to less than 2%, Commission says.

The European Commission is recommending that the EU does not need to introduce tougher controls in a bid to reduce “errors” in EU-funded research, energy, transport and rural development projects to less than 2%. 

In a communication due to be adopted on Friday (28 May), the Commission says that trying to reduce the error rate – the proportion of spending that does not meet EU-set criteria – to below 2% would cost more than it would save.

It argues that it is acceptable to keep the “risk of possible error” to 2%-5%.

Cost-effective efforts

This is the first time that the Commission has indicated an acceptable error rate, and follows a request made in 2004 by the European Court of Auditors, which wants to ensure that its spending controls are cost-effective.

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The court has previously indicated that only an error rate of below 2% should be treated as “free of material error”.

The Commission stresses in its communication that controls should not be eased.

The recommendation, which does not cover some of the biggest budget items, is the latest attempt to improve the quality of controls on how the EU spends its annual €130 billion budget.

The Court of Auditors has declined to approve the EU’s spending in 15 successive years.

However, it said in its latest report – for 2008 – that, for the first time, the percentage of errors in spending on rural development was below 2%.

In one area beyond the communication’s scope, cohesion policy, at least 11% of spending was found to contain errors.