The error rate in EU budget spending has fallen to 3.6%, but for the sixth consecutive year, the European Court of Auditors (ECA) has issued an adverse opinion on the Union’s expenditures. In its latest annual report, the auditors also warn of mounting risks arising from the EU’s growing debt, which could exceed €900 billion by 2027.
Errors in EU Spending Decline but Remain Significant
According to the ECA, the EU’s financial statements for 2024 provide a true and fair view of the Union’s financial position. However, irregularities persist in several areas of spending. The estimated error rate stood at 3.6%, compared with 5.6% in 2023 — an improvement, but still above the materiality threshold of 2%.
“Although the reduction in the error rate is a step forward, there are still too many irregularities in EU spending,” said Tony Murphy, President of the European Court of Auditors.
“Deficiencies in oversight and accountability structures persist. As the EU’s post-2027 budget takes shape, stability and transparency of future Union finances must be ensured.”
For the sixth year in a row, the Court issued an adverse opinion on EU expenditure, noting that the level of error remains “widespread and material.” The highest concentration of errors was found in cohesion policy spending, where the error rate reached 5.7%, compared to 9.3% the previous year.
The most common irregularities included:
- financing of ineligible projects or costs,
- violations of public procurement rules,
- and errors in projects financed outside the EU.
Recovery and Resilience Facility Under Scrutiny
The auditors also issued a qualified opinion on the Recovery and Resilience Facility (RRF) — the main pillar of the Next Generation EU recovery package.
In 2024, EU member states received €59.9 billion from the RRF, of which six disbursements did not meet formal requirements. In one instance, the ECA was unable to verify the fulfillment of judicial reform “milestones” because the case was still pending before the Court of Justice of the European Union (CJEU).
The ECA also highlighted problems with the reliability of data submitted by member states and shortcomings in the design and assessment of RRF objectives.
Rising Risks to Future EU Budgets
The auditors warn that debt incurred to finance the EU recovery program could surpass €900 billion by 2027 — nearly ten times higher than in 2020.
Debt-servicing costs are also increasing sharply:
- during the current budget period, interest payments may exceed €30 billion, more than double the originally planned amount,
- between 2028 and 2034, they could rise to €74 billion.
The ECA calls for caution in planning the next post-2027 budget, stressing the need to strengthen control mechanisms, performance measurement, and transparency in the use of EU funds.
What the Error Rate Means
The “estimated error rate” does not indicate fraud, but rather the percentage of funds spent in breach of EU or national rules. In 2024, auditors reported 19 cases of suspected fraud to the relevant EU authorities.
Source: CEO.com.pl
