On Tuesday 4 October, the European Court of Auditors (ECA) sounded the alarm over the high level of infringements of the European state aid rules in the field of the cohesion policy, which they believe affects one public aid measure in every five.
Of the 50 cases of non-compliance with the rules on state aid identified between 2010 and 2014, ECA found that the errors in 16 of them had had an impact on the amount paid for out of the EU budget.
One type of mistake made concerns the intensity of the aid, in other words the level of the aid expressed as a percentage of the eligible costs of the project. For instance, it has happened on a number of occasions that the national management authority wrongly identifies a large company as an SME and awards it the SME premium, to which the company is not in fact entitled.
ECA also flags up the lack of incentive in certain aid granted, even though this is a requirement under EU state aid rules. At the European institution stresses in its report, state aid will not achieve the public interest objective unless it incentivises the beneficiary to undertake activities it would not have done without aid. However, the report notes, in certain cases the work had already begun before the project's application had been submitted to the competent authority for aid to be granted. In other cases, the state aid was not detected or notified or the management authorities had not met their control and verification requirements to make sure that state aid-like measures are compatible with the single market.
For this period, the Commission carried out six financial corrections solely for state aid (in France and Spain) and representing €3.2 million.
By streamlining the law on state aid, the Commission has also increased the responsibility of the EU countries in designing and implementing aid measures.
Oskar Herics, the ECA member with responsibility for the report, stressed that the audit authorities of the member states are an important link in the control chain in the cohesion policy. However, he went on to note that the auditors had not been able to confirm that these authorities were paying enough attention to state aid as part of their audits.
Commission called upon to take a tougher line. The EU auditors therefore recommend that the Commission impose corrective measures in cases in which the aid does not comply with the state aid rules, or make use of its prerogative to suspend the payments to the countries in question if, by the end of 2016, the ex-ante conditions for state aid have not been met.
The Commission reacted on Tuesday by stating that the measures under its 2015 action plan would improve the capacity of the member states to detect issues and help reduce error rates. "We are working closely with the management authorities to strengthen their monitoring and control systems", it added. (Original version in French by Élodie Lamer)