§ Mrs. Winifred Ewingasked the Minister of Agriculture, Fisheries and Food if he will make an up-to-date statement on the steps being taken by the EEC to combat farm fund frauds in the EEC member countries in 1974 and 1975; and what was the total amount of such frauds uncovered in 1974.
§ Mr. BishopI welcome this opportunity of providing the following information.
2. In October 1974 the Commission introduced a number of measures to tighten up financial control with particular reference to FEOGA revenue and expenditure. The Director General for Agriculture was instructed to institute a system of random inspections; the Directorate General for Financial Control was instructed to conduct sector by sector investigations; it was decided to create special inspection teams and to set up documentation centres to deal with information on laws, regulations and administrative provisions relating to Community revenue and expenditure collected and incurred in the member States.
3. The necessary additional posts were authorised under the Communities' 1975 Budget, and the Directorate General for Financial Control will have two additional divisions to which the special inspection teams will be assigned.
4. The Commission's Directorate General for Agriculture is going ahead with random inspections of supporting documents and centralised accountancy data and is checking that transactions have in fact taken place. Up to mid-February 1975 inspections involving the Guarantee Section of FEOGA represented a total of 121 inspector/days.
5. Sector by sector inspections are being carried out by special inspection teams attached to the Commission's Directorate General for Financial Control to establish whether national implementing arrangements conform to the rules, to investigate suspected irregularities and, in the most serious cases of suspected fraud, to launch full-scale inquiries. Despite the fact that the special inspection teams were not fully operational in 1974 the Directorate 172W General for Financial Control carried out 27 investigations representing 76 inspector/days.
6. The Commission's Special Committee of Inquiry which was set up in October 1973 to examine the possibility of fraud and irregularities in the management of Community funds has reported to the Commission on the milk products sector and on the oil seeds and olive oil sectors. These reports contain general as well as specific recommendations for the avoidance of irregularities. They have been drawn to the attention of the Council, the European Assembly and the Audit Board and have been examined by the Select Committee on European Secondary Legislation. The Special Committee has now started to examine the beef and veal sector.
7. In the light of the Committee's findings on the milk products sector the Commission decided to study the possibility of using computers to administer and supervise the Guarantee Section of FEOGA; to speed up discussions of the proposal for a regulation on mutual assistance between competent national authorities and between the latter and the Commission for ensuring the correct application of Community customs and agricultural regulations and for the proposed directive on mutual assistance in the recovery of sums wrongly paid in connection with the agricultural policy, agricultural levies and customs duties; to tighten up the application of Council Regulation (EEC) 283/72 concerning irregularities and the recovery of sums wrongly paid in connection with the financing of the CAP.
8. The Commission has in fact paid particular attention to the operation of Regulation 283/72 which is concerned with irregularities and the recovery of sums wrongly paid in connection with the financing of the common agricultural policy and the organisation of an information system in this field. An Expert Group of the FEOGA Committee and the Committee itself, both composed of representatives of member States and the Commission, have been examining irregularities reported by member States with a view to identifying weaknesses in existing regulations so that these can be corrected and to encourage member States to intensify their efforts to prevent fraud and to detect it when it has occurred.
173W9. In addition member States have decided that a convention embodying common rules on improving co-operation in the prevention and punishment of offences against Community economic law should be drafted and should be ready for signature before the end of this year.
Number of cases Sums wrongly paid Amount recovered Amount being recovered £ million* £ million £ million Guarantee Section … … … 87 4.9 3.8 1.0 Guidance Section … … … 150 0.17 0.08 0.08 * Converted from units of account at the rate of £1 =2.4 u.a.