Brussels, 26/01/2016 (Agence Europe) - The management of the financial assistance provided to five member states (Hungary, Latvia, Romania, Ireland and Portugal) had positive effects in terms of budgetary cleansing and reforms, but the European Commission's action leaves considerable room for improvement, the European Court of Auditors states in a report it published on Tuesday 26 January.
The external auditor refers to the “achievements” of the Commission in assuming its financial crisis management responsibilities, given the tight timeline of the events. The positive effects of the financial bailout programmes include meeting the revised deficit targets and improving structural deficits, albeit at “a varying pace”, as well as the handling of reforms as a condition for financial aid to be granted.
However, the Court identified four main areas of concern. It finds that the countries in question were not “being treated in the same way in a comparable situation”. “In some programmes, the conditions for assistance were less stringent, which made compliance easier. The structural reforms required were not always in proportion to the problems faced, or they pursued widely different paths. Some countries' deficit targets were relaxed more than the economic situation would appear to justify”, the auditors observe. The second issue is that quality control was “limited”, for instance because the work of the experts was not thoroughly scrutinised. The Court also raises the question of the use of accrual-based deficit targets which, although compatible with the excessive deficit procedure of the Stability and Growth Pact, make it impossible to verify whether these targets have been met until after a certain period of time. Lastly, the available documentation was not geared towards an evaluation of the decisions made.
The external auditors of the EU therefore recommend that the European Commission take the following steps: - establish a framework allowing a rapid mobilisation of staff if the financial assistance programme emerges; - ensure that appropriate procedures are set in place to examine the quality of the management of the programmes and the content of the relating documentation; - distinguish between conditions on the basis of their importance and target the truly important reforms; - formalised inter-institutional cooperation with other programme partners; - make the debt management process more transparent; - further analyse the key aspects of the countries' adjustment after the programme closure.
The European Commission observes that according to the Court, the principal objective of the financial aid programmes analysed was met, in other words a return of the countries in question to the debt markets and the economic recovery of these countries. “Most of the problems identified have been tackled”, such as improving procedures without slowing down the decision-making process, a spokesperson said.
Greece. The European Court of Auditors will publish two specific reports on the Greek bailout plans. The first of these, which is anticipated for the first quarter of 2016, will answer the question of whether the technical assistance coordinated by the Commission made a positive contribution to the implementation of the programmes and the process of reform in Greece. The second will consist of an assessment of the conception, monitoring and results of the economic adjustment programme for Greece. (Original version in French by Mathieu Bion)