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Errors inrural development spending
7 May 2015
Presentation byRobert MARKUS
Head of UnitEuropean Court of Auditors
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Our “DAS” audits showed the same
- error levels (avg. 8,2 %) and- the same error types
Specific audit with as questions:
- what are the main causes of errors?
- how can they be addressed?
Errors in rural development spending
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Our audit:
- analysed the results of the last3 years of the “DAS” (a random EU wide sample of 461 EAFRD payments)
- reviewed action plans and the legal basis
- was published as Special Report 23/2014
Errors in rural development spending
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Types of errorsthe main drivers of the error rate were the type of beneficiary and the type of measure (and not: the MS)
Errors in rural development spending
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Types of errorsmain drivers: the type of beneficiary and the type of measure
Errors in rural development spending
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Types of errorsmain drivers: the type of beneficiary and the type of measure
Errors in rural development spending
sample error rate
14100.0%
4,1%
32000.0%
4,1%
Farmers
Other beneficiaries
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Types of errors
Errors in rural development spending
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Types of errors
Errors in rural development spending
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Types of errors
Errors in rural development spending
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Causes of error -1-
- public bodies are a significant source of error because of non-compliance with public procurement rules
- of the many rules, only three categories of serious breaches of procurement rules caused a significant impact on the error rate e.g. unjustified direct award without a competitive procedure
- two root causes: limited experience and lack of guidance for small municipalities; beneficiaries preferring to work with specific contractors
Errors in rural development spending
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Causes of error -2-
- Non-respect of eligibility criteria for investments, in 4% (6/152) indications of intention
- the measure supporting investments in food-processing facilities raises the most concerns
- root cause: Member State authorities could have detected and corrected most errors affecting investment measures
Errors in rural development spending
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Causes of error -3-- area-related aid generated almost a third of
the error rate, the main cause being non-compliance with farming commitments for AE
- primarily the result of non-respect of basic commitments
Errors in rural development spending
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Causes of error -3-- root cause: low incentives for farmers to
comply, a low control rate for commitments and a low sanction rate for non-compliance
- in around half of the errors, the verification of commitments could have been shifted from the on-the-spot checks to administrative checks (from 5% -> 100%)
Errors in rural development spending
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Not causes of error -1-
- some measures were more prone to error, whereas others were hardly affected by error
- few errors were found in “young farmers” and “LFA” which are characterised by a focused scope, lump sum payments and a small number of detailed requirements
Errors in rural development spending
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Not causes of error -2-
- for the projects audited, the rules were not unnecessarily complex and did not impose unjustified requirements on beneficiaries and Member State authorities
- only limited examples of gold-plating were found, with a marginal impact on the error rate
Errors in rural development spending
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Not causes of error -2-
- on the contrary, the audit did find examples where effective rules were withdrawn
- in the context of reducing the causes of error, it is important to maintain an appropriate balance between the number and complexity of rules, and the need to guarantee the legality and regularity of spending
Errors in rural development spending
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How are the causes of error being addressed
- action plan exercise by the Commission and the Member States is a step in the right direction
- however: insufficient focus on preventing widespread weaknesses at EU level
Errors in rural development spending
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How are the causes of error being addressed
- the new EU legal framework may have a positive effect in addressing the causes of errors
- attention needs to be given during the on-going steps of the regulatory process at Member State level, as most errors occur in the implementation of specific provisions in Member State legislation
Errors in rural development spending
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Recommendation
Analyse to what extent the characteristics of a more focused scope, limited eligibility criteria and simplified cost options can be used more widely
This would fit very well with simplification and performance based controls!
Errors in rural development spending
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Thank you for your attention.
Paldies par uzmanību.
Any questions?
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Contact Details
Robert MARKUSHead of Unit
+352 4398 [email protected]
European Court of Auditors12, Rue Alcide De GasperiL-1615 Luxembourg
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Robert MARKUSHead of Unit
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