1998 REPORTS ON THE STRUCTURAL AND COHESION
FUNDS
(a)
(20605)
12011/99
COM(99) 467
(b)
(20606)
12012/99
COM(99) 483
|
Structural Funds — tenth annual Report by the Commission (1998).
Annual Report on the Cohesion Fund (1998).
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| Legal base: |
— |
| |
| Department: |
Trade and Industry |
| Basis of consideration:
| Minister's letter of 26 January 2000
|
| Previous Committee Report:
| (both) HC 23-i (1999-2000), paragraph 6 (24 November 1999)
|
| To be discussed in Council:
| No date set |
| Committee's assessment:
| Politically important |
| Committee's decision:
| (both) Cleared; but further information requested
|
Background
10.1 When we last considered these reports
(in November 1999), we asked the Minister for Trade (The Rt. Hon.
Richard Caborn) for clarification on a few points emerging from
them.
The Minister's letter
10.2 The Minister has now responded to all
our questions.
10.3 In relation to the Structural Fund
Report, we asked why the UK's Single Programming Document (SDP)
was not adopted until 1998. The Minister says:
"The previous Administration
was unwilling to implement the Objective 4 Programme and refused
to do so in the 1994-96 programme. Agreement in principle on Objective
4 was reached during the negotiation of the Objective 3 programme
in 1997. Negotiations on an Objective 4 programme began but, because
of the impending General Election, could only make slow progress
and were not completed until late 1997. The new programme was
therefore implemented in 1998".
10.4 Noting that some cases of irregularities
had been closed at national level but still not followed up, we
asked the Minister what actions the Commission was taking to ensure
that Member States kept it informed of the outcome of their investigations,
and whether he considered that it had sufficient authority in
this regard. In reply, the Minister states:
"The Commission reminds Member States of the
need to follow up and keep it informed of the outcome of any investigation
into irregularities. If necessary, the Commission has the authority
to deduct the cost of projects from Member States' programmes
if they do not co-operate. We believe, with the Commission's financial
control and irregularities Regulations (EC) 2064/97 and the Structural
Funds Regulations (EC)1260/99, the Commission has sufficient authority
to deal with these instances".
10.5 Finally, picking up the concern expressed
in the EM on the Cohesion Fund Report, we asked the Minister what
steps the Government had taken to impress on the Commission the
need to review the adequacy of the anti-fraud procedures of the
Cohesion States and the importance of reporting fraud cases. We
wondered whether the Government had any reason to believe that
some cases existed which had not been reported; if so, what action
the Commission had taken; and, if that had proved ineffective,
what action the Government was prepared to take in Council.
10.6 The Minister replies as follows:
"The only forum for
the UK to raise issues relating to the Cohesion Fund is the annual
Cohesion Fund information meetings. At the next meeting, we intend
to raise the importance of reporting fraud cases and the need
to review the adequacy of the Cohesion countries' anti-fraud procedures
and ask the Commission what action they are taking or propose
to take to ensure Member States are reporting fraud cases. In
our Explanatory Memorandum on the Cohesion Fund Annual Report
(1998) we state that the absence of any case of fraud being reported
to the Commission causes concern. The UK Government would like
clarification that [that] is not because there may be cases of
fraud which have not been detected".
Conclusion
10.7 We thank the Minister for his response.
While there can, of course, never be certainty that an absence
of reported fraud means an absence of fraud, we support the Government
in its wish to see effective anti-fraud procedures in place in
the Cohesion countries and encourage it to press the Commission
on this issue. We find it surprising that there is only one annual
forum in which the UK can raise issues relating to the Cohesion
Fund; we ask to be informed of the outcome of that meeting in
relation to the reporting of fraud. Meanwhile, we clear the document.
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