Why don't we know how much added value the EU generates?


On 14 October 2020 the Court of Audit published a report on the Netherlands’ net payment position in the European Union. We thought it necessary to line up the figures and explain just how much the country contributed to the EU and how much it received from it. The European Commission and the Dutch government have long disputed the amount.

Their difference of opinion relates chiefly to the Netherlands’ contributions. Should they include customs duties (the import tariffs charged on goods that enter the EU through the Netherlands) or not? The Commission thinks they should not: customs duties are collected on the external borders of the customs union on behalf of the EU, and sent to the EU after the deduction of collection costs. The Netherlands, by contrast, thinks they should be included because imports are determined largely by its own economic performance and are not miraculously brought about by the existence of a customs union.

These different definitions had a significant impact on the figures for 2014-2019. Under the Dutch definition, the Netherlands was the biggest net contributor to the EU throughout the entire period. Under the Commission’s definition, the Netherlands was a more modest contributor; it was the biggest in 2014, but fluctuated between second and fifth place in the other years. The ‘frugal’ countries the Netherlands recently worked with in the negotiation of the EU’s Multiannual Financial Framework for the next 7 years, Sweden, Austria and Denmark, are also in the top 5.

But what do the figures really mean? They could reinforce a prejudiced view of the European Union. They do not explain how much added value the EU generates, whether it strengthens the economy, makes the country a healthier, more pleasant place to live, work and travel. Does the EU make us safer?

As EU citizens, we have a right to ask how much we pay to the EU and how much we get back from it. For many years, the Court of Audit has been calling for more clarity about the results of projects funded by the EU. What do we get out of them? Are they useful and necessary? Answering these questions is a challenge to both the EU and the member states. But if no clear benefits can be demonstrated, it is just a small step to misuse of the funds or suspicion of misuse.

The work of the European Court of Auditors and the member states’ supreme audit institutions can help fill in the missing information. Last year, for instance, the Court of Audit investigated which farmers in the Netherlands received agricultural grants. It found that a considerable proportion was paid to farmers who already earned more than twice the modal income. The EU and the member states have primary responsibility for unearthing this information. In close cooperation with the House of Representatives, for instance, the Dutch government is improving policy efficiency and effectiveness through its Insight into Quality initiative. It is high time the EU launched its own Insight into Added Value programme.

Until then, figures on the net payment position and the like will remain in circulation. And until then, we at the Court of Audit think it is our task to clarify the figures and explain the differences.

Ewout Irrgang is Vice-President of the Netherlands Court of Audit’s Board