The European Union: Pooled Sovereignty, Divided Accountability
| Author | John Peterson |
| DOI | 10.1111/1467-9248.00096 |
| Published date | 01 August 1997 |
| Date | 01 August 1997 |
| Subject Matter | Article |
The European Union: Pooled Sovereignty,
Divided Accountability
JOHN PETERSON
Introduction
Viewers of the 1992 Olympic games in Albertville and Barcelona may have been
impressed at the extent to which the European Union (EU) ± its ¯ag, anthem
and symbols ± were featured alongside those of the host nations, France and
Spain. Surely, few European taxpayers were aware that the EU had paid for a
third of the cost of the opening ceremony at Albertville and nearly half of
Barcelona's. Probably even fewerever knew that the European Commission was
later condemned by the Union's ®nancial watchdog, the Court of Auditors, for
spending EU funds on the Olympics when `the idea of dual loyalty on the part
of athletes and of using the Community ¯ag when medals were being awarded
came to nothing'.1
The incident was a microcosm of the problems of blurred accountability
for what the EU does and spends. It highlighted the tendency for Union funds
to be used for dubious purposes when it saves Member States money, the
Commission's inattention to the details of new schemes which appear to further
European integration, and the Court of Auditors' (CoA) constant snapping at
the heels of other EU institutions. The CoA's annual audits of EU spending
usually underline the point that EU funds are not wasted through accidents or
corruption very often. Rather, the problem lies in rules which are poorly-drawn,
the o-hand attitude of Member States to compliance, and weak central
controls over revenue and expenditure.
It is not coincidental that estimates of how much of the EU budget is wasted
are wildly speculative and unreliable.2The Union is caught in a vicio us circle: it
is impossible to know what resources are needed to combat fraud because it is
unclear how much fraud exists. Disagreements about the scale of the problem
are a convenient obstacle to doing anything about it.3
#Political Studies Association 1997. Published by Blackwell Publishers, 108 CowleyRoad, Oxford OX4 1JF, UK and 350 Main
Street, Malden, MA 02148, USA.
I am grateful to Clare McManus and Ricardo Go
Âmez for research assistance and to Elizabeth
Bomberg, Anthony Comfort, Paul Heywood, Heikki Oksanen and (especially) Michael Shackleton
for useful comments on earlier drafts. Thanks also are due to the numerous interviewees who gave
generously of their time during the preparation of this paper. A wider project into EU decision
making from which this paper emerged was supported by ESRC grant ROOO235829. Mostof the
research for this paper was conducted during my residence as Visiting ResearchFellow at the Centre
for European Policy Studies, Brussels in autumn 1995.
1European Court of Auditors, Annual Report concerning the ®nancial year 1992, Ocial Journal
C309, p. 276, November (1993).
2The Court of Auditors generally estimated a global ®gure in the mid-1990s of between two
and 10 per cent of the total EU budget. See also D. Ruimschotel `The EC budget: ten per cent
fraud? A policy analysis approach', Journal of Common Market Studies, 32 (1994), 319± 42.
3N. Tutt, Europe on a Fiddle (London, Croom Helm, 1989).
Political Studies (1997), XLV, 559±578
In contrast to the `democratic de®cit'4or `transparency',5fraud and corrup-
tion in EU governance have attracted relatively little academic attention. It is
dicult to resist the conclusion that a conspiracy of silence between practi-
tioners and analysts has, until recently, allowed the rot to sprout unfettered.
Recent eorts to clamp down on EU fraud seem a frantic, emergency response
both to new populist doubts about the `European project' and a comprehensive
review of the EU's ®nancial arrangements prior to negotiations on a new 5-year
`®nancial perspective' for funding the Union after 1999.
This paper advances four essential arguments. First, if corruption is de®ned
as `behaviour by a public servant, whether elected or appointed, which involves
adeviation from his or her formal duties because of reasons of personal gain',6
the EU is a relatively `clean' and corruption-free system of government. Second,
waste and fraud are rife and intractable: they are natural eects of the way in
which Member States have pooled sovereignty but not accountability, thus
keeping the top `tier' in EU governance weak while making national executives
less answerable for what they do. Third, fraud will remain endemic to the EU
as long as those actors with the strongest interest in eliminating it are not given
greater powers. Fourth, the most pernicious eect of the communautaire
political culture which characterizes EU decision making is not the excesses of
its central institutions, as considerable as they are. Far more damaging is the
Union's uncritical acceptance of the sanctity of national customs and practices,
which often condone or even promote waste, fraud and ineciency.
Sovereignty, Accountability and the EU
De®ning `EU fraud' means navigating very murky waters. The very ®rst annual
report of the European Court of Auditors insisted:
We should be clear what is meant by fraud. It has been de®ned as criminal
deception, the use of false representations to gain an unjust advantage. In
the Community context it is the deliberate misappropriation of money or
goods, inevitably involving breaking the law or the relevant rules and
instructions of the organization concerned .. . But actions which remain
within the law cannot be considered to be fraudulent.7
This de®nition was soon found to be wholly inadequate by the CoA itself,
which rarely has used the term `fraud', referring instead to `irregularities'.8EU
fraud and irregularities generally are not subjects of Community law. A
4S. S. Andersen and K. A. Eliassen (eds), The European Union: How Democratic Is It?
(London, Sage, 1996); M. Newman, Democracy, Sovereignty and the European Union (London,
Hurst, 1996).
5J. Peterson, `Playing the transparency game: policy making and consultation in the European
Commission', Public Administration, 73 (1995), 473±92; A. McLaughlin and J. Greenwood, `The
management of interest representationin the European Union', Journal of Common Market Studies,
33 (1995), 143± 56.
6J. LaPalombara, `Structural and institutional aspects of corruption', Social Research,61 (1994),
p. 328 (italics in original).
7European Court of Auditors, Annual Report concerning the ®nancial year 1977, Ocial Journal
C313/8 (1978).
8C. Kok, `The Court of Auditors in the European Communities: ``the other European court in
Luxembourg'' ', Common Market Law Review, 26 (1989), p. 360.
560 The European Union
#Political Studies Association, 1997
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