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No transparency in the Brussels Kremlin

August 22 2002

The EU loves to talk the language of transparency and accountability, but it has a way of firing officials who actually try to deliver on transparency.

A couple of weeks ago I had lunch with Bernard Connolly. Bernard was for several years the most senior Commission official working on plans for monetary union. Then in 1995 he published a book entitled "The Rotten Heart of Europe", subtitled "The dirty war for Europe's Money". It's an excellent book, which takes the lid off the in-fighting and skulduggery that have characterised the euro project.

In 1996, Bernard was fired by the Commission. Whistle-blowing is not welcome in Brussels. During his action for wrongful dismissal before the so-called European Court of Justice (ECJ), the court ruled that criticism of the EU was "akin to blasphemy", and therefore not protected by the normal right to freedom of speech!

Although I have known about this for a long time, I am still frankly appalled that the ECJ could come up with such a Stalinist proposition. My good friend and colleague Phillip Whitehead, the Labour MEP, gets very hot under the collar when I compare the European Union to the Soviet Union, but in the face of that sort of judgement, it's difficult not to.

Bernard actually helped me understand a problem that had been bothering me. Often when I speak about the economic problems of the euro, people say to me afterwards "You were very convincing, but if you're right, why can't those clever chaps at the European Commission see the problem?". I've tended to assume that they're simply dazzled by the European dream, and not prepared to think through the consequences.

Bernard has a different take on the question. He says that the Commission knows perfectly well that the euro will create financial crises in member states. But they not only accept that - they welcome it. Why? Because when a crisis arises, the EU itself is the bail-out of last resort. And the price of the bail-out is that the EU takes control of the member-state's economy - its tax and spending plans.

I should have said that this was a conspiracy theory too far, but for the fact that it is happening right now, in Portugal. A Commission hit squad is in Lisbon as I write, sorting out the economic problems created by the euro. And on current trends the same could be happening in Ireland or Finland in the next year or two.

Of course Bernard is not the only whistleblower to be dumped on by the EU. A couple of years back Paul van Buitenen discovered a range of abuses in the Commission. His bosses wouldn't listen, so he went to the parliament.

Unfortunately, Commission employees have a confidentiality clause in their contracts (whistle-blowing may be protected in the UK, but not on the Brussels Kremlin). So Mr. van Buitenen was promoted to take charge of the Commission's car parks.

But the latest whistle-blower, Maarta Andreasson, is the most remarkable of all. Brought in as a professional accountant to look at the Commission's systems, she was appalled by what she found. Spending nearly 100 billion euros of our money, the Commission lacks even the most rudimentary accounting controls. It has primitive software that allows anyone to hack in and change the numbers, without leaving a record of who made the change.

The system is so bad that it is impossible to identify whether fraud has taken place - much less to stop it. The system that runs the EU budget would disgrace a corner-shop.

Maarta still has a contract and a salary, but - surprise surprise - no actual job.

And whose fault is all this? Step forward our own Neil Kinnock, Commissioner responsible for administration and reform. It was astonishing that a member of the disgraced Santer Commission should be reappointed at all, still more astonishing that he should be put in charge of reform. And what has he done in three years? Presided over a Commission with woefully inadequate accounting skills and systems, and apparently done little or nothing to address the problem.

Britain is a net contributor to the EU, to the tune of about £3 billion a year. How would it be if we withheld our contributions until we were satisfied that the EU has systems in place to manage the money? We've been members of the EU now for thirty years. On the current track record it will probably take another thirty years until they sort things out - if ever