BRAVO! THE PRESIDENT of the EU has offered €60 million to French towns affected by riots, under the “framework of an urban programme”. All those disaffected youths can now train as urban consultants, split the fee between themselves and advise others how to milk the system. Voilà. That’s bound to be a bigger growth industry than replacing burnt-out Renaults.

Taxpayers might ask whether, if the EU has this kind of cash going spare, it would be better returned to them. But on Tuesday they were once again dismissed with a collective Gallic shrug. It is only a shame that we could not see the shoulders of Denis MacShane MP rising and falling on the radio, as he responded to the auditors’ refusal to sign off the EU budget for the eleventh year running. “Whaddya want,” was his gist, “an inspector for every subsidised sheep and goat? Get real.” Fine. If we can’t spend money wisely, we should stop handing it out.

Under British law, our Government has a duty to rectify mis-spending of taxpayers’ money. Yet the Serious Fraud Office claims that it has no remit to investigate the dealings of the EU unless it is clear that funds have been wrongly paid to British beneficiaries. Which is convenient, since many of the problems in Brussels seem to stem from those of, shall we say, a Mediterranean persuasion. In Spain, more olive trees were declared for subsidy purposes than were registered in the official control system. In Greece, where farm unions control the input of data into the farm subsidy computer system, the Court found that none of the data was reliable.

It is not only farmers who are doing a bit of an Italian Job. Membership of the Self-Preservation Society is widespread. It includes Antonio Fazio, governor of the Bank of Italy, who apparently intervened in a takeover to help a banker who is under criminal investigation, but who refuses to do anything so Anglo-Saxon as to resign; and some Brussels bureaucrats for whom the meaning of “probity” seems to have been lost in translation.

What else can explain the Commission’s decision to jerry-build its own computer budgeting system? No company would entertain a system of accounting spreadsheets that can be changed by anyone at any time without trace. But the Commission went to the trouble of building one, even though it had a perfectly good system based on a well-known software package. Project budgets go up and down like yo-yos. There is still no balance sheet listing all the EU’s assets and liabilities because no one has a clue what money goes in and out. Except perhaps those officials who have access to the computer and who might, just possibly, press the delete button once in a while. Or maybe quite often.

So blatant are the irregularities that it took remarkly little time for Paul van Buitenen, the auditor, and Marta Andreasen, the chief accountant, to spot them. Both were sacked. Mrs Andreasen queried some of the payments she was asked to authorise, including some for offshore accounts, whose existence the Commission has never satisfactorily explained. About half of her queries were never answered: the cheques simply never crossed her desk again. We must presume the Commission paid up. But Mrs Andreasen could not tell, since she was never given a list of signatories who were authorised to sign cheques on behalf of the Union. No company finance director would stand for such a situation.

Until now, the laid-back Latin approach has continued partly because the ultimate sanction for accounting failure, the Parliament forcing the resignation of the Commission, is a very blunt instrument. But now the EU is at a critical point. Next month the Commission will be trying to persuade member states to increase its budget. The British presidency, for one, is unlikely to be sympathetic to pleas to throw more cash into a black hole. A new Europe needs an accountant who actually accounts — an idea regarded as outlandish by the Commission but one that has long been embodied, but ignored, in the treaties. It is astonishing that the chief accountant of the EU still does not sign the accounts.

The Commission, though, still lacks a sense of urgency. In June EU ministers argued that misspent money should be paid back within eight years — hardly an onerous deadline. The Commission insisted on the right to extend the time limit to 12 years. Wow.

The Commission blames member states for not monitoring the use of EU cash. But no business would get away with merely blaming its contractors for misspending or misappropriating funds on this kind of scale. If the EU insists on blaming member states and refuses to put its own house in order, the member states should call its bluff and take back the running of the asylum. If EU money was channelled through national budgets, this would be no different to the structural lending done by multilateral development banks. If those control filters are good enough for Argentina, why not for Europeans? If people want to repatriate graft and corruption, let them. Then make them explain it.

This deregulation would also force problems into the open. We will never know how much money has been spent taking satellite pictures of flocks of sheep and counting oranges dumped in Spanish rivers that are then driven back up to the top again by crooked farmers to be double-counted. The difficulty of monitoring such a grandiose welfare scheme is clear, and it strongly reinforces the case for scrapping the Common Agricultural Policy and its trade-distorting subsidies. Overlaps between EU and national foreign aid programmes would also be exposed. In September the European Court of Auditors criticised EU programmes in Africa for paying too little attention to, among other things, corruption.

This year the Commission underspend is “only” 2.7 billion euros. If that is a real figure and not another accounting fiction, they should be returning that money to sender, not writing cheques in les banlieues.

Join the Debate
Send your e-mails via
www.timesonline.co.uk/debate

Times Recommends

• It’s the beginning of the affair
• Afghanistan: still a price worth paying
• Heroes of the downtrodden