The EC insufficiently controls the use of money from the pandemic fund, auditors claim

The EC insufficiently controls the use of money from the pandemic fund, auditors claim

EC insufficiently controls the use of money from the pandemic fund, auditors claim

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Brussels – The European Commission has set insufficient control over the distribution and use of money from the extraordinary recovery fund supporting economic recovery after the covid-19 pandemic. This is stated in today's report by the auditors of the European Court of Auditors (ECA), according to which the finances from the package containing 724 billion euros (roughly 17 trillion crowns) should be better protected against possible misuse. According to the auditors, the Commission does not check whether the states monitor compliance with EU or national law when distributing money.

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The EU filled the fund known as the Recovery and Resilience Instrument with money from an unprecedented joint loan and began distributing it the year before. The most is to go to Italy and Spain, the Czech Republic can get around 180 billion crowns. All member countries must demonstrate the fulfillment of a number of reform milestones before the money is gradually paid out, with which the commission wants to ensure, among other things, that the money is used mainly for ecological and digital transformations.

According to the auditors, however, it is problematic that the rules of the fund, unlike from ordinary structural funds, they do not precisely establish responsibility for compliance with EU and national standards.

“People will only trust the new ways of EU funding if they can be sure that their money is being spent properly. At the moment, the level of certainty that the Commission can provide in the case of the EU's main post-pandemic recovery fund is insufficient, and it is also insufficient deriving responsibility at the EU level,” said ECA President Tony Murphy today.

The Commission has started paying money to the vast majority of member countries, but Hungary and Poland have not yet received it due to problems with respecting the principles of the rule of law. The countries received the first 13 percent of their share in 2021 as part of the pre-financing, after which Brussels sends them additional amounts depending on the achievement of milestones. So far, the commission has distributed roughly a fifth of the total package.

The auditors also see as a problem the fact that, according to them, it is not clear what will happen to the money already paid in the event of the cancellation of a financed project. In addition, according to the ECA, it was not clear for a long time what amount the commission would freeze a member country if it only partially met the milestones. In the report, the Court of Auditors called on the EU executive to correct the deficiencies. According to the auditors, the Commission wants to examine in more detail in the coming years whether the controls of compliance with the rules carried out by individual countries are sufficient.