European Court of Auditors: Court of Auditors continues to see high error rates when spending EU funds

Even in 2025, a significant amount of EU funds will not have been spent in accordance with regulations. The European Court of Auditors concludes in a new report that an estimated 3.8 percent of spending in the last financial year was incorrect. With total expenditure of around 167 billion euros, this corresponds to a total of around 6.7 billion euros in which EU regulations were violated.

The most common problems included violations of public procurement rules and the financing of ineligible projects or expenditure. In the previous year the rate was slightly lower at 3.6 percent. In 2023, the EU auditors put it at 5.6 percent, the highest level in years. Above a threshold of two percent, irregular expenditure is considered “essential”.

The auditors particularly looked at irregular disbursements from the Corona development fund worth around 650 billion euros. In order to receive the aid, member countries must submit a plan with concrete investment and reform projects. The money should only be paid once promised milestones in the implementation of planned reforms and investments have been achieved.

Funds should be linked more closely to reforms

According to the auditors, of 37 payments from this pot to EU countries in 2025, 9 did not comply with the applicable regulations and conditions. For example, procurement regulations were violated and funds flowed before the corresponding goals were achieved.

This is interesting in view of the current budget negotiations, said the Court of Auditors. The new long-term EU budget for 2028 to 2034 is currently being discussed in Brussels. Similar to the Corona recovery fund, the Commission's proposal for the trillion-dollar budget also envisages linking funds more closely to reforms, concrete goals and milestones achieved.

In addition, cases were discovered in which the predetermined goals were simply ignored. "Essentially the ambitions in the plans are scaled down to essentially ensure that the money can be paid out," said ECA President Tony Murphy. However, according to the Court of Auditors, the estimated error rate is “not a measure of fraud, inefficiency or waste.” It is an estimate of the amounts that were not used in accordance with EU and national rules.

Auditors warn of high debt burden

The Court of Auditors also warned of the consequences of the EU's increasing debt, which could rise to up to one trillion euros by 2027 - around ten times as much as before the start of the Corona recovery fund in 2020.

In the future, almost every tenth euro of the European budget will go towards paying off debts, said Daniel Caspary, the German member of the Court of Auditors. In the medium term, he expects a significant increase in national contributions, "particularly for Germany as the largest net contributor."