Billions of EU's euros going unused: report

30th November 2010, Comments 0 comments

Billions of euros earmarked by the European Union for developing rundown areas are lying idle because member countries cannot find the required matching funds, the Financial Times reported Tuesday.

More than half-way into its spending cycle, the EU has spent only 10 percent of the 347 billion euros (456 billion dollars) allocated until 2013 for promoting growth in poor regions, according to EU documents seen by the paper.

The fund, intended to assist small and medium-sized enterprises, has also been tapped into by multinational giants including Coca-Cola, IBM, and Nokia Siemens -- although this was not illegal, the paper said.

The newspaper's investigation into the EU's structural funds found that 8.4 billion euros was paid out of the fund in error, 25 percent of which was still to be recovered.

EU social affairs commissioner Laszlo Andor warned against overplaying the significance of the statistics.

"This is not a bank that needs to produce a balance at any given moment," he told the newspaper.

The European Commission -- the Union's executive arm -- blamed the slow uptake of funds on the time taken to select suitable projects; for the money eventually allocated to be spent; and for it to be reimbursed by Brussels.

© 2010 AFP

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