On paper, everything is fine, or almost. In reality, frauds against the Common Agricultural Policy (CAP), the largest item of expenditure in the European Union (EU) budget, are far more numerous than they appear to be. Indeed, the Commission, like the Member States, which share the task of monitoring the proper use of Community funds, can, in certain cases, be permissive and allow fraudsters to act with impunity. This is, in essence, the message of the European Court of Auditors, which published a report on the subject on Monday 4 July. The choice of subtitle for this publication – “It is time to attack the problem at the root” – is unambiguous.
The sums involved are significant. As the Luxembourg institution recalls, between 2018 and 2020, each year on average, direct payments to farmers (generally depending on the area of agricultural land available to farmers) represented 38.5 billion euros, while expenditure linked to market measures (intended to help certain sectors) and rural development amounted to €2.7 billion and €13.1 billion respectively. Over the period 2016-2020, reported irregularities concerned 0.09% of CAP payments. This digit “is not a direct indicator of the degree of fraud, but rather of the results obtained by Member States in their fight against fraud and other illegal activities affecting the financial interests of the EU”note the magistrates.
The report of the European Court of Auditors resembles a small manual of possible frauds which can easily escape the control of the Commission as of the Member States, so much this one remains random and insufficient. We thus discover that certain beneficiaries of Community funds do not respect the conditions to which they are theoretically subject, without this being prejudicial to them. They “omit important information or artificially create the conditions allowing them to fulfill the eligibility criteria and to benefit unduly from CAP aid”can we read.
“The more complex the projects, the higher the risk”
Thus, aid reserved for SMEs can be circumvented in favor of larger companies. In Bulgaria, for example, an investigation by the European Anti-Fraud Office (OLAF) revealed that agricultural actors, who had reached the ceiling of the aid to which they were entitled, obtained Community funds – around ten million euros – through other seemingly independent entities that were in fact under their control. In this case, therefore, the fraudsters have been caught, but given the holes in the nets of European controls, there is no doubt that many of their colleagues escape unscathed.
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