£35bn EU poverty budget 'wasted'
Benedict Brogan Mail - 27 December 2007
THE European Union is 'spraying' £35billion a year at 'absurd' development projects which do little to alleviate poverty or promote economic growth, a report claimed last night.
Schemes funded by British taxpayers include roving 'city clowns' in Finland, a conceptual project to turn Barnsley into a 'Tuscan hill village', a mobile burger van intended to lecture building site workers on sustainable development and a 'nail beauty' course for traveller women.
The money for the projects comes from the EU's structural and cohesion funds, which are intended to allow the poorest parts of Europe catch up with their wealthier neighbours.
But the Open Europe think-tank, which investigated the funds, claimed that much of the £245billion allocated to the scheme between 2007 and 2013 will be wasted.
Mats Persson, the report's author, said yesterday: 'The absurd system where we send money to Brussels then get some of it back minus the cost of bureaucracy has got to stop. The real losers from the current system are the poorest areas. The UK and other governments don't want to keep on wasting money.
'The only real motivation for continuing with these failing programmes seems the EU's desire to be seen to be handing out money and doing good things.' British officials are now hoping that control of the funds will be handed back to national governments.
But some other countries, in particular those with a tradition of corruption, do not trust their own authorities to spend the cash wisely. The structural and cohesion funds are distributed on a system of regional allocations which do not take into account variations in wealth in some areas, the report found. Precise figures are difficult to obtain, but the Open Europe study - called Why the EU should not run regional policy - suggested that just ten per cent of the funds are spent in the poorest fifth of the EU.
The research group, which campaigns against the EU, concluded that the programme targets funds poorly, has huge bureaucratic costs and spends money on wasteful projects which do not create jobs.
It also claimed that the system is vulnerable to fraud. Perhaps the most worrying finding was that the funds are failing to achieve their primary aim - to alleviate poverty in the EU.
Of the 44 regions granted Objective One status in 1989 - the most needy group - 43 were still eligible for funding 14 years later.
The report said: 'Because of EU rules which say that regional authorities must spend money or lose it, the focus is very much on "getting the money out of the door". This and other factors lead to the commissioning of wasteful projects which do not boost growth or employment.'