AGRICULTURE: COMMISSION TO RECOVER EURO 275.5 MILLION OF MISSPENT FARM FUNDS.

Under the Common Agricultural Policy, the Member States are responsible for paying out and controlling virtually 100% of expenditure and for collecting all levies and recoveries under the European Agricultural Guidance and Guarantee Fund (EAGGF). The clearance of accounts procedure is an essential instrument of controlling CAP spending. It requires the Commission to assure, principally by way of on-the-spot inspections, that the Member States have correctly used the funds put at their disposal by the EAGGF. And it permits the recovery of sums paid out without sufficient guarantees as to the legitimacy of these payments or the reliability of that Member States' control and verification system. Every year over 100 inspections are carried out by the Commission at national level. The Commission works with the Member States to ensure that throughout the EU the responsible paying agencies conduct strict controls on all claims before they are paid, and that the paying agencies' accounts and procedures are audited each year up to internationally-accepted standards.The Commission also actively assists all Member States to put into place an integrated control system using the most advanced techniques to check fields by aerial and satellite photography, and to cross-check claims in computer data-bases. Finally, when in spite of these efforts the Commission finds that a Member State has weak control procedures, or does not respect the Community rules, it recovers from the Member State concerned the amount misspent. If the systems put into place by a Member State prove to be unsatisfactory, the Commission refuses to finance all or part of the expenditure concerned.Per sector, export refunds (Euro 160.7 million) were at the root of most major fraud cases in the 1995 EAGGF accounts, well ahead of public storage in Italy (Euro 38.5 million) and livestock premia (Euro 26.1 million). It is expected that the Commission will take a further decision on the recovery of Euro 500 million by July. This matter is now on appraisal within the Conciliation Committee (designed to reduce disputes referred to the Court of Justice), which is called upon to help work out a compromise when the Member States challenge the amount of money the Commission seeks to recover. In principle, the Commission will take two or three decisions each year, covering the results of its enquiries in the Member States.Irregularities for the storage of durum wheat in Italy.The 1995 financial...