This headline will come as no surprise to the public with ‘problems,’ according to the auditors, being blamed as much on lack of local controls and management weakness, as the farmers who have been fiddling grant applications.
The European Court of Auditors considers that an astonishing 75% of the audited projects that had been financed under the scheme for agricultural investments ‘to improve the environment’ largely have been a waste of money, with plenty of examples coming from Portugal.
The report, released on January 22nd, 2106, is based on audits performed in Portugal, Denmark, Italy and the UK.
The conclusion is that most of the so-called 'non-productive investments' did contribute to landscape and biodiversity protection, but that in 75% of cases the costs were either too high or ‘insufficiently justified,’ auditor-speak for a rip-off.
The report covers the fate of €860 million of funding for non-productive investment projects, €226 million of which was sent to Portugal with little onward control on how grants were issued and how the money actually was spent.
In Portugal, the report highlights stone wall repair projects on the terraces of the Douro wine region.
This work represented 89% of the funding received by Portuguese farmers in this grant category between 2007 and 2013, and the conclusion was that the price of the stone used was inflated.
"National authorities have set a maximum eligible cost of €250 per m3 for the construction of stone walls that sustain agriculture in terraces.
According to data provided by national authorities, the average cost paid to the beneficiaries was €198 per m3. Reference values presented by professionals such as the National Association of Construction Companies suggest that the unit cost for this type of work is €75 per m3," reads the auditors’ report.
Another flaw identified in Portugal was that the work was awarded to contractors who had no operating license. This was the case in 12 of the 20 projects examined.
In total, the European Court of Auditors concluded that only five of the 28 projects audited had been cost effective.
The problems, say the auditors, are not just from farmers taking full advantage of free money, but stem from weaknesses in the management and control systems of the Member States.
