EU: Fraud (EUC Report)

Viscount Eccles Excerpts

Wednesday 11th December 2013 Grand Committee

[Viscount Eccles (Con)]

My Lords, I go back a long way to 1949 and the Council of Europe. If ever there were a referendum, I cannot imagine voting to come out of the European Union. That does not mean that I cease to think about the problems facing Europe and speculate a bit on how much of a contribution we can make to the solutions to those problems.

I have to record that I was new to the committee when it started this inquiry, and new to the procedures of sub-committees preparing reports, although I had read quite a number of them. As I went into that I thought about the background—the financial crisis, fairly rapid change, the expansion of the membership of the Union and the identification of problems. There is of course a rather large gap between the identification of problems and the practicality of solutions to them. I was also minded to think that many empires have fallen because they were top heavy. Today we know very many things and how to do them; in fact, there is a lot that we know about how we could do them if we had the resources, but we do not. We do not have the money and, more importantly, we do not have the people. The people who are capable of implementing some of the things that we would like to see implemented are spread very thin.

In considering the report, I wondered: where do we, the United Kingdom, rightly come into this picture? The report says with great accuracy that fraud is opaque. As the noble Earl, Lord Sandwich, said, it is also endemic. It does not matter what we are going to do, it will not disappear, because human nature is best seen as a constant. Therefore, the first question that we might ask is: how many programmes do we want? What level of expenditure within those programmes do we want? What complexity do we want those programmes to have? What are we actually trying to do with them? If we had fewer programmes we would have less fraud. The more complex the programmes are, the greater the army of people. I have applied for European money in the past, and the number of people who will advise you on how to knock down that money from the tree is legion. It is a profession—and, of course, those people could be doing something else, perhaps adding more value. So is that the right use of resources? We should think rather more seriously about the objectives we are looking for.

We then come to another danger and another question. Are we right to be judging others by ourselves? Almost certainly not. The Commission, after all, is sui generis, and I join others in saying that there is absolutely no point in being highly critical of the Commission because there is fraud against its programmes. That does not make any sense at all. I completely agree with that. Then we think about the members, their objectives, the reasons why they are members in the first place and their capacity to implement programmes. If they take advice, which they do, there are many imaginative ways of providing that advice. That imagination can extend into how you spend the money, as well as how you get it in the first place.

I cannot get excited about the uncertainty in the figures. My question is: what do you do about the situation? What is the United Kingdom’s contribution to wise implementation of answers to these problems? When there are problems there is always a temptation to design new institutions or seek more legal procedures. However, in my experience, for all the people who claim to have a good plan to do this or that, few could implement such a plan if it were put into place. Therefore, for me, it is important to implement measures within the existing systems. How can we make the existing structures work better? Reference has been made to OLAF and I completely agree that there is a pressing need to co-operate and exchange data. Whether it is sensible to have that channelled into one place, I leave to others to decide. If people are willing to work with and talk to one another, we do not necessarily need just one focal point.

However, of one thing I am certain: that is, in the difficult circumstances that pertain, particularly within the eurozone, we need to work with what we have. I do not see any future in having new centralised institutions. As for the United Kingdom, we should cope better than we do with any fraud that is perpetrated here. We should seek to minimise fraud and prosecute those committing it. As regards cross-border fraud, we should offer others maximum co-operation, but seeking a centralised, European Union-wide silver bullet to solve these problems will not work and we should not contemplate it.