Euro-MPs Voice Their Anger
Over Collapse of Cash Control
by Ambrose Evans Pritchard

The European Commission has overseen an "intolerable" breakdown of EU financial control while subjecting whistleblowers to vindictive treatment, Euro-Mps said yesterday.

The European Parliament's annual report on the £70 billion budget expressed "extreme alarm" over failures in the Commission's accounting system, finding that the books did not add up and large sums of money could not be traced.

The report, drafted by Paulo Casaca, a pro-EU Portuguese socialist, complained that no commissioner had taken the blame for the disappearance of £3million into " black accounts " at the EU's data office, Eurostat.

Pedro Solbes, the economics commissioner in charge of Eurostat, has refused to accept the blame for abuses described by investigators as "a vast enterprise of looting".

The MEP's report orders the commission to pay damages to whistleblowers. Yves Franchet, Eurostat's former chief, continues to draw a £144,000 salary plus perks while key officials linked to the downfall of Jacques Santer's commission after fraud allegations in 1999 kept their posts in the machinery.

By contrast, Paul Van Buitenen was suspended on half pay after he disclosed endemic abuses under Mr Santer, and Marta Andreasen, the commission's chief accountant, was fired when she said the budget was "an open till waiting to be robbed".
The Daily Telegraph, 29th January 2004

Britain Faces Payouts to
EU's £40 Bn Begging Bowl
by David Hughes

Plans for a massive rise in EU spending threaten to plunge Europe into a bitter financial row.

The European Commission, led by Romano Prodi, is ready to defy its biggest member states, including Britain, by demanding a staggering £14 billion increase. It wants the extra cash to pour into poor areas in the ten countries which will join the EU on May 1st. The rise would push up the individual British taxpayer's contribution to the EU to £2.50 a week.

Tony Blair flies to Berlin in ten days for a summit with German chancellor, Gerhard Schroeder and French President, Jacques Chirac to try to halt the spending plans.

Shadow Foreign Secretary, Michael Ancram said last night: "When will the Commission learn that the EU should do less and do it better? If these spending rises go through, Britain will be paying much more and getting little in return."

The confrontation over the new EU budget, which runs from 2007 to 2013, could split the newly-enlarged EU right down the middle. The planned huge spending rise will be set out by the Commission on Tuesday. It is designed to raise and re-focus spending to promote regional development in poor new member states. It will also direct resources into research in a bid to make the EU economy more competitive with the US.

The budget proposal will signal the start of a bloody 18-month battle that will pit rich states against poor ones.

According to sources, a majority of the 20 Commissioners are backing proposals to keep the current ceiling on the EU budget at 1.24 per cent of gross national income - but to spend up to that limit. At the moment, spending is running at under one per cent of national income.

By spending up to the limit, the EU's budget will rise from £75billion this year to £116billion by 2013. The present budget costs the average taxpayer in Britain around £105 a year. The increase being demanded by Brussels would push that up to more than £130 a year. Most of that is spent on the Common Agricultural Policy which costs around £33billion a year and benefits France more than any other country.

Britain, Germany, France, Sweden, Holland and Austria are resisting the budget rise. They want to cap EU spending at one per cent of gross national income. The Commission, however, argues that this is impossible because of the cost of integrating ten poor countries that join in May, plus Romania and Bulgaria which are lined up to join in about five years.

The Commissioners say that given the level of farm subsidies the rise is inevitable. "The political challenges we face are enormous," declares the Commission's draft document. It goes on: "The EU could decline and turn into a heavy bureaucratic organization."

One commissioner said privately: "Politically the Commission could not seek a figure less (than 1.24 per cent)." He noted that the budget ceiling had remained unchanged since 1992 while the EU's areas of action had expanded enormously.

The ten new EU members are Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovenia and Slovakia.
Daily Mail, 7th February 2004

UK Was Right Not to Join Flawed
Euro, Admits Jacques Delors
by Charles Bremner and Greg Hurst

Jacques Delors, the former President of the European Commission, fuelled the controversy over the euro yesterday by admitting that Britain was justified in opting out of the single currency because its launch was flawed.

In a remarkably frank interview with The Times, the one-time bogeyman of Eurosceptics also predicted that Britain would stay out for years, not least because Gordon Brown was so "passionate about his contempt for Europe".

In another startling admission, the veteran French left-winger said that European Union was in a "state of latent crisis" because of weak leadership. He blamed member state leaders, including President Chirac of France, for putting national interests before the common good.

M Delors, 78, also spoke with unexpected admiration of Baroness Thatcher, his old nemesis. He says that she was a "figure who counts" in British and European history, and the way her Conservative colleagues dumped her was an example of the "atrocious" manner in which male politicians treat female colleagues.

But his most surprising comments were on the euro. He lamented that EU leaders had failed to heed his warning that monetary union must be matched with close co-ordination of economic policies, and argued that the euro was consequently less attractive than it could have been.

"Since we have not succeeded in maximising the economic advantages of the euro, one can understand the British….saying, 'Things are just fine as they are. Staying out of the euro hasn't stopped us prospering'," he said.

Denis McShane, the Minister for Europe, said M Delors' comments, vindicated the Government's "sensible decision….to make economic conditions rather than ideology the central issue as far as the euro is concerned."

But Michael Ancram, the Shadow Foreign Secretary, said: "This is an extraordinary admission by M Delors. If a champion of European integration says that the euro hasn't worked, it shows how right Britain has been to stay out, doubly so if a harmonised economic policy is proposed as the way forward."

M Delors led the Commission for ten years, pushing through both the single market and the 1991 Maastricht treaty on monetary union, and has just published his memoirs. He spoke warmly of Britain, though he called its aversion to Europe "a great mystery of history". But he was sharply critical of his own country. He deplored the opposition in France to the EU's imminent enlargement and President Chirac's attempts to lay down the law to the former Soviet block states because of their pro-American leanings.
Times Online, 20th January 2004

Further Resources:
Ten Minutes to Midnight by Phillip Day
Vigilance by Ashley Mote
The Real Face of the European Union (PAL video documentary) by Phillip Day

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