$500M in Farm Funds Misused Across Europe

(CN) - Nearly half of the countries in Europe must give back more than $500 million in agriculture subsidies for incorrect use of the funds, the European Commission announced Friday.

The commission said it will recover funds from 13 EU states, including Denmark, Germany, Estonia, Greece, Spain, France, Italy, the Netherlands, Poland, Portugal, Romania, Slovenia and the United Kingdom. The agency said the countries either failed to comply with EU rules or had inadequate control procedures on agricultural spending in place.

Under the Common Agricultural Policy (CAP), member states are responsible for managing payments and controls like verifying farmers' claims for direct payments. The commission carries out 100 audits a year and has the power to "claw back funds in arrears if the audits show that member state responses are not good enough to guarantee that EU funds have been spent properly," according to a commission statement. The commission also noted that it has already recovered $12.5 million in misspent funds.

Europe's wine industry bore the brunt of the commission's wrath, accounting for almost 60 percent of the corrections. Several countries with the most significant corrections are also embroiled in Europe's financial crisis. The commission assessed Spain nearly $164 million for planting vineyards without re-plantation rights, and Greece must repay more than $130 million for violations across several agricultural sectors.

"In order to take account of the financial pressures being felt by some Member States due to the financial crisis, the Commission has adopted a regulation allowing Member States under financial assistance to delay, on certain conditions, the reimbursement of disallowed funds for up to 18 months. This comes in addition to existing options to request that the reimbursement be spread over a limited number of years," the commission said, adding that Greece has already applied for the relief payment schedule.

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