Articles Default

New study on EU agricultural funds shows fraud, corruption and misuse of European money in Central and Eastern Europe

Brussels, 25 February 2021 – Today, the Greens/EFA group in the European Parliament released a report which shows that with the current capping practices, only the few biggest players are benefiting from the overwhelming majority of Common Agricultural Policy (CAP). Therefore, the outcome is not in line with the official CAP objectives. The study maps out in clear terms how EU funds contribute to fraud and corruption in five EU countries: Bulgaria, Czechia, Hungary, Slovakia and Romania.

The report outlines up-to-date cases, including fraudulent claims and payments of EU agricultural subsidies to Slovakia, the conflicts of interest around the Czech Prime Minister’s Agrofert company in Czechia, and state interference by the Fidesz government in Hungary.

“The Commission is supposed to be guardian of the treaties, but it is refusing to take proper action against fraud, corruption and misuse in EU agricultural funds. Transparency, accountability and proper scrutiny are essential to building an agricultural system that works for all, instead of enriching a select few. Unfortunately, data on subsidy recipients are scattered over hundreds of registers, which are mostly not interoperable with the Commission’s fraud detection tools. Not only is it almost impossible for the Commission to identify corruption cases, but it is often unaware of who the final beneficiaries are and how much money they receive. In the ongoing negotiations for the new CAP period, we cannot allow the Member States to continue operating with this lack of transparency and EU oversight,” says Czech Pirate MEP Mikuláš Peksa who is a member of the Budgetary Control Committee, and chairperson of the European Pirate Party.

The study also comments on reports about the problems with the work of the Agricultural Paying Agency (PPA) in Slovakia. Since the launch of the police operation called “stock-breeder” in April 2020, two former directors of the PPA, Juraj Kožuch and Jozef Partika, as well as politicians and businessmen have been arrested. They are accused of operating a structure, in which bribes were systematically collected.

“The exposed corruption scheme caused huge problems, and no one wants to be part of the team solving the problem, at least that’s how it seems. If the funds will be distributed by a foreign agency with no direct relations to Slovak companies and agriculture, it might help us move forward,” says the Vice-chair of the Slovak Pirate Party Marcel Litvák Feliks. According to Litvák Feliks, the arrests are a step into the right direction, but the PPA agency is still not moving forward.

The report’s main findings reveal a system that is more and more based on cash crops. As funds are based on the size of the land, incentives are given for higher land and capital concentration and agricultural production. As a result, small family farms are the beneficiaries only a small proportion of the EU support, whereas bigger agro-conglomerates and bigger companies are receiving the overwhelming majority of CAP funds. In some of these countries, even the existing support for small farmers is being implemented in a way that is undermining its potential. Another overarching problem is a lack of transparency and publicly available information in many Member States. While the results of this report are causing high waves in the European Union, the EU institutions are already in the process of negotiating the CAP for the years 2021-27.


0 comments on “New study on EU agricultural funds shows fraud, corruption and misuse of European money in Central and Eastern Europe

Leave a Reply