EU anti-corruption report stops short of 'naming and shaming'

  

The European Commission said yesterday (3 February) that its first anti-corruption handbook for the 28 member states showed that there were "no corruption-free zones", but officials declined to name and shame individual countries.

Commission: Corruption costs EU €120 billion yearly

The Commission published yesterday (3 February) its much awaited 40-page anti-corruption report covering the overall situation in the 28-country bloc, coupled with individual chapters on each country, of approximately a dozen pages each. The package is supplemented by a 230-page special Eurobarometer survey on corruption.

The EU executive said that its rather modest ambition was to launch a debate on corruption and identify ways in which the EU could help fight the scourge.

Corruption is estimated to cost the EU economy €120 billion per year. That amounts to about 1% of EU GDP and represents only a little less than the annual budget of the European Union.

The anti-corruption package has been in the pipeline since Home Affairs Commissioner Cecilia Malmström announced the establishment of an EU anti-corruption reporting mechanism in June 2011, saying a first report would be published by the end of 2013 (see background). The publication of the report was delayed, she admitted, adding that the quality of the report was now better.

Malmström told reporters that the handbook assessed how each member state tackled corruption, how existing laws and policies worked in practice, and contained suggestions for how each EU country could step up the fight against corruption.

“The Report will hopefully provide everyone - politicians, the public, media and practitioners – with a useful tool for taking national corruption policy forward,” Malmström said.

Crisis increased corruption?

According to the Eurobarometer, a vast majority (76%) of Europeans think that corruption is widespread in their own country. Also, more than half of Europeans (56%) think the level of corruption in their country has increased over the past three years, an apparent indication that the eurozone crisis has impacted negatively on the fight against corruption.

The report shows the state of play in the member states om terms of legislation, institutional framework, and problematic areas for each individual country. “Good practices” are identified with suggestions for “future steps”.

The report cites an integrity programme in the Flemish region of Belgium as an example of good practice. Wallonia, the country's French-speaking region, has no such initiative.

The report also advises Belgium to increase the capacity of its justice and law enforcement system to prevent the statute of limitations on corruption cases from expiring during lengthy criminal proceedings.

Malmström strongly insisted that the Commission made no “ranking” of corruption levels in EU countries, saying that other organisations were engaged in this activity. The NGO Transparency International had ranked EU countries according to perceived corruption levels, with the “most corrupt” being Greece, Bulgaria and Italy, and the least Denmark, Finland and Sweden.

The commissioner was also careful not to speak of dividing lines and of major divisions between North and South, acknowledging only that Bulgaria and Romania were special cases, which required continued monitoring.

Too much diplomacy?

The Commission was also careful in the report not to mention countries by name. Sources told EurActiv that EU countries had rejected the option of "naming and shaming", and this had been the main reason for the delay of the report's publication by a few months.

The paper says that “in some member countries”, vulnerability to corruption in public procurement processes is the main problem, while “in others” political party financing is not transparent enough. Widespread corruption at the level of local authorities is another example, with “many healthcare patients" having to "pay under the table to receive proper medical care”.

“In one Member State, numerous cases of alleged illegal party funding at central or regional level were also linked to organised crime groups”, the report says, without mentioning Italy.

The report also shies away from naming individuals or parties. The report cites "investigations involving a former treasurer of a political party" in Spain. The prime minister of Spain, Mariano Rajoy, last year became embroiled in a corruption scandal, saying that he made a mistake in trusting the former treasurer of his Popular Party, Luis Bárcenas.

Spain also witnessed another corruption scandal involving Princess Cristina, the youngest daughter of Spain's King Juan Carlos, and her husband Inaki Urdangarin.

Malmström said that the idea had been discussed to conduct a corruption investigation into the EU institutions but that it was decided that the EU executive could not do this independently.

EurActiv asked Malmström why the EU survey asked business representatives if corruption was bad for their business and not the other way around.

“As you can imagine, being responsible for law and order, we did not ask that question. But I think you’re right. I think a lot of companies actually make good business out of corrupt contracts,” she said. 

Positions: 

“We welcome this report as an important step in the EU's collective effort to scale up its anti-corruption efforts,” said Miklos Marschall, Deputy Managing Director of Transparency International. “It is a stark warning against complacency about corruption in any EU country.”

“Trust in Europe’s leaders is falling because relations between business and the public sector take place in the dark, leaving citizens with questions about whose interests are being taken care of”, said Marschall. “To bridge the gap between politics and people, there must be greater transparency in public life and more public officials held to account for their actions.”

EU ministers need to follow up with concrete commitments when they meet for the Justice & Home Affairs Council in Brussels in March, Transparency International said.

“Corruption crosses borders and is a threat to the integrity of the single market”, said Carl Dolan, Director of the Transparency International EU Office. “For these reasons, Europe needs coordinated action to tackle the failings identified in the report, such as EU legislation on whistleblower protection”.

A new independent study by Czech, Polish and Slovakian watchdogs has published a “Shadow report” on misuse of EU funds by the Commission and the three studied member countries.

Up to a third of the EU resources allocated to the countries is not reimbursed by the EU programs and—as the authors of the study believe—this is largely due to the effects of political corruption and lack of rules and transparency.

“It is not surprising that EU funds are linked with chronic political corruption in the three studied states since not even the basic rules against conflicts of interest are in effect. EU hasn't been successful in convincing the governments to do so,” comments Martin Fadrný, coordinator of the research team. Among the key findings of the research team is that anonymous companies are allowed to be beneficiaries of EU funds and there is almost nothing preventing politicians from owning such companies.

Data shows that among companies winning public contracts in the Czech Republic (including EU-funded) 10% had ownership structure with unidentifiable owners and 15% owners form tax havens. A recently published study by Transparency International Czech Republic and Bisnode indicates that during 2008–2013 in the Czech Republic, anonymous companies won public contracts worth CZK 8.7 billion (€300 million) from EU funds. In the same period, companies with owners from tax havens won contracts of more than CZK 6 billion (€218 million) from the EU funds.

Approx. CZK 14 billion (€500 million) from EU-funded Czech Operational Program Transport went to the construction company Viamont while its former owner held the position of minister of transport and could easily influence officials managing the EU money. Read the full report

The European Ombudsman, Emily O'Reilly, welcomes the European Commission's first Anti-Corruption Report and its recommendations to the various national administrations and invites the Commission to add a chapter on the performance of the EU administration to the next report.

Emily O'Reilly explained: "The EU administration has to live up to the very highest standards, especially when it comes to transparency, strict rules concerning conflicts of interest, and high integrity standards in the area of public procurement. In most of these areas, the EU institutions already have high standards in comparison to many national administrations. I encourage the Commission to take account of the forthcoming work of Transparency International on the integrity system of the EU institutions and to include the EU institutions in the next Anti-Corruption Report."

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Comments

Andre Clodong's picture

Back in 1996, Transparency International Brussels highlighted the devastating effect of corruption on markets, development and society. The wheels of the European Union turn very slowly.

Walter's picture

In the interest of all the robbed EU citizens please publish and SHAME the nations and individuals concerned.
Corruption in all its forms is a crime;; there is no need for a debate which will go no-where.
The EU has punished its own brave whistle-blowers on corrupt practices so is there any hope that the so called debate will lead anywhere, other than giving more time and space to the beneficiaries of corruption to steal even more.
The robbers are on the EU gravy train; they will not ambush that train themselves.

David Bennett's picture

"EU anti-corruption report stops short of 'naming and shaming'"
It also stops short of naming and shaming the corrupt within its Brussels ranks. In fact the section of this report detailing theft within was deliberately omitted.
Democracy at work

Valdimar Samuelsson's picture

We in Iceland thought the IPA Funds was corruption money and nothing but bribe given to us to smear their way to get people in Iceland like EU. They call it Instrument for Pre-Accession Assistance (IPA)
This they still pay some foreign countries to undermine governments and people. Yes they even pay Iceland IPA after we denied merging with EU and they still operate propaganda office in Iceland to undermine people. I wonder if you over in Europe know about how corrupt your people are in Brussel.

Valdimar Samuelsson's picture

We in Iceland thought the IPA Funds was corruption money and nothing but bribe given to us to smear their way to get people in Iceland like EU. They call it Instrument for Pre-Accession Assistance (IPA)
This they still pay some foreign countries to undermine governments and people. Yes they even pay Iceland IPA after we denied merging with EU and they still operate propaganda office in Iceland to undermine people. I wonder if you over in Europe know about how corrupt your people are in Brussel.

Dusty's picture

When I was a teenager, Portugal was fighting a war in Africa. At that time Portugal was a full Member of NATO (since 1948) and a full member of EFTA. Swedish diplomacy repeatedly accused Portugal of genocide in Africa at the UN, shortly after the independence of Portugal's colonies in Africa; we happen to know that Swedish and Norwegian weapons manufactures had been selling weapons to the insurgency for years... My conclusion, there is always this double talk and judgment about the fact that the "South" is more corrupted than the "North". For me it is just a matter of how you sell it.

George Mc's picture

No one likes to see corruption of any type, but I despair at this report.

Coming up to the EU elections, we have a report which says corruption in the member states is, at best, not good and that it is the responsibility of the member states.

It goes on to give a limp excuse as to why the EU has not reported on its own institutions. I wonder why? Is it too bad coming up to an election to report. I am sure they could have had a stab (Estimate or suggest what they believe or think or feel).
Meanwhile, there are no reports of corruption being reported to the relevant authorities. Would this be because the report contains words like:

ESTIMATES
LIKELY
CLAIMED UPTO
2009 ESTIMATES
SUGGEST
THINK
BELIEVE
THINK
FEEL

and in fact is total Boll*cks!

I have no doubt that corruption happens, but this report should give no one any confidence that it is actually KNOWN how bad it may or be, or not.

KP's picture

This report, on the one hand, is quite necessary because so far corruption in EU was monitored only in Bulgaria and Romania, while we all know that it's EU-wide. On the other hand, the question is how transparent the European Commission and the other institutions are and theoretically how to trust a anti-corruption report of an intransparent institution. I find quite weak and embarassing in the report that various conclusions are based on citizens' perceptions and surveys rather than on factual evidence. Many statemenets are vague and abstract. There is a big space for improvement for the next such report, if there will be one at all.

evad666's picture

Interesting no one is named.
My region of the UK was decimated by a corrupt government official who was allowed to walk scot free by a major political party.
The same party gained notoriety for its media spin and manipulation.
The same party stuffed its creatures everywhere including the Commission.

Dr David Hill's picture

I wonder when the EC will conduct a corruption report on itself or have we to wait for a maverick corrupt nation to do this dirty work? The problem is if this happens we shall never know if it was a corrupt regime but where it has to be said that corruption is rip in all western nations. The difference is that EU and western nations are past masters at covering their tracks and covering for each other. Basically they all p..s in the same bowl and use hot air to make the citizens of the EU et al think that they are not corrupt but where in fact they certainly are. You will never stamp out corruption in politics or a nation's civil service for it has been going on since prime ministers were created.., a very long time indeed....

Dr David Hill
World Innovation Foundation

Dr David Hill's picture

Oh I forgot to say that the biggest corruption being created presently is the USA-EU trade pact that will allow the giant corporates to override sovereign laws. If that is not corruption on the grandest scale of the altar of democracy I just don't know what is?

EU officials, EU ministers and big business are all in the thick of it and there will be many who will as usual make millions behind the scenes to the total detriment of what will happen to the vast majority of EU people. All criminal of course but where these people do not know the simple difference between what is right and what is wrong. Apparently they forgot what their parents told them?

Dr David Hill
World Innovation Foundation

George Mc's picture

@ D David Hill

"You will never stamp out corruption in politics or a nation's civil service for it has been going on since prime ministers were created.., a very long time indeed...."

Or as we say in Scotland " It's been happening since Christ left Dumbarton" and I'll put money on it continuing until the next resurrection!

Valdimar Samuelsson's picture

That one is true David H. And we always elect them again or more they always put them self in front to be elected.
We at least in Iceland have anti EU government and it turns out there was never more that 25 to 30% EU follower but with those loud mouth politicians they could use those to tell EU we would love to join you.

Dr David Hill's picture

George Mc

You put it far better than myself.

Valdimar Samuelsson
It is the system of democracy that has been corrupted by the 'party' system and where partyocracy rules supreme. This corruption means that it is not the wishes of the people that are paramount but what the 'party' wants. Even though their will never be a corruption free political system, not until the electorate start to vote for independents more, will we see a reduction in corruption at all. These political 'party' people look on the electorate as sheep and where unfortunately the voters keep on giving their vote to the same old ideologies that have never worked. Strange that many of the electorate cannot see the wood for the trees and for once give the controlling political parties a real sit up call for 'real' change for the better. Complacency is the death of democracy and the lies that our political classes concoct for party control is criminal as once in power whatever they have said is soon forgotten. All that counts is power and the 'party' has it. A sad old world that has not changed since time immemorial.

Newton's picture

George Mc
Well said, indeed!
There are two very old English sayings that also came to mind:
"Those who live in glasshouses shouldn't throw stones" and "That sounds like the pot calling the kettle black".

Iwantout's picture

Worth comparing this article with this one published on Euractiv 3rd February regarding an MEP sentenced to prison for corruption. (http://www.euractiv.com/future-eu/ex-mep-serve-prison-cash-laws-sc-news-... ). The really worrying points in this context being that according to OLAF the European Parliament refused to cooperate with the investigation and that two MEPs who accepted cash are still sitting in the Parliament.

George Mc's picture

@ Iwantout

You are absolutely correct to highlight this (I had missed that story) in this context.

When it comes to corruption, it is my opinion that Brussels and the EP with its MEPs would not stand up well to examination. I think that there have been rumblings in the past about their lack of integrity.

The UK parliament would probably look like a kindergarten in comparison.

I wonder how the potential President of the new Commission will come out of this one?

http://www.euractiv.com/eu-elections-2014/epp-puts-heat-schultz-stanishe...

Dr David Hill's picture

Iwantout

What do they say about ultimate power?

These old boys networks that drive the gravy train ignore the people at their peril. Indeed as people become more informed they will in my mind take matters into their own hands, as frustration has a funny way of suddenly exploding into the open without warning. In this respect there appears to be a bubbling under belly where people are realising more by the year that things will not just change for the better with the continual incumbents that are appointed to weave their power over us. As they say the worm will turn eventually as there will be no alternative but to do so. When that happens I would not want to be an EU power tripper that we have now with vested-interest being the all consuming driving force.

George Mc
Interesting but just the 'tip' of the iceberg I fear with this rotten lot who care more about themselves than the 500 million plus EU citizens who fund their activities, but for what is big question?

Corruption it appears has a face. That face is those hypocrites that run this merry-go-round we call the EU.

Valdimar Samuelsson's picture

Look at Russians now they are no different than the rest of the world. See all those foreign companies having their share of the cake. One has ''postbox'' office in Sweden and channels all revenue to the Keyman or offshore banks. Last years we have fought for being able to elect individuals but now those individual are in ruling party of the Government so Hmm. we will see.

Barry Davies's picture

The eussr needs to get its own corruption sorted out before it bleats on about others, or does this unelected failed politician think that we won't notice.

ashtonpeter's picture

There was also a report that allow speed cameras to catch bad drivers and humiliate them in the public.Some of its most dangerous intersections, allegedly to improve the safety of the motoring public. Last week, the New York State Legislature failed to vote on a bill that would have made them legal for ticket-generation within the state’s municipalities. Source: https://personalmoneynetwork.com/