Friday

29th Mar 2024

Valencia faces EU probe over dodgy statistics

  • Valencia faces an EU investigation into whether it deliberately sent false data on government spending. (Photo: SWIFT)

The European Commission has launched a probe into whether the Spanish region of Valencia is guilty of the first case of statistical fraud since the Greek crisis in 2009.

The investigation, which will look at years worth of unreported spending by the region, could carry stiff sanctions including, at worst, a fine worth up to 0.2 percent of Spain's economic output.

Read and decide

Join EUobserver today

Get the EU news that really matters

Instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

In May 2012, Spain's statistical office was forced to revise up its deficit forecast for 2011 by 0.4 percent after turning up previously unrecorded spending in Valencia and Madrid. A subsequent investigation by Eurostat, the bloc's statistical agency, confirmed that Valencia had sent incorrect data on government spending to the Spanish statistical authorities for a number of years.

In a paper issued on Friday (July 11), the EU executive warned that Valencia's local government appeared to have "systematically sent incorrect information to the national statistical authorities over many years."

It added that the investigation, which could last up to 10 months, would seek "to determine whether there has indeed been deliberate manipulation and / or serious negligence and to decide which part of the “chain” was responsible for this".

For his part, Algirdas Semeta, the commissioner for statistics, said that the "quality and credibility of European statistics is not something that the Commission is willing to compromise on."

However, the commission is not calling into the question the reliability of Spain's overall data.

Under the bloc's economic governance rules, re-written in response to the eurozone debt crisis, deliberately cooking the books can carry a fine worth 0.2 percent of GDP.

Statistical fraud in Greece, where the government's deficit forecast of 4 percent for 2009 had to be revised to over 12 percent, wrecked market confidence in the country's ability to pay its bills, forcing it into the first of two bailout programmes worth €300 billion.

With the Greek crisis affecting confidence in other eurozone countries, EU politicians vowed to tighten up controls of statistical offices and production, handing new powers to Eurostat and auditors.

Regional and national offices are now required to send data to the Luxembourg-based Eurostat at least twice a year.

Meanwhile, new rules also allow Eurostat and commission officials to conduct country-specific visits in order to verify dubious data.

Spain faces fine over false statistics

Spain became the first casualty of beefed up EU rules on statistics after the European Commission recommended the country be fined €19 million for misreporting of deficit data by the region of Valencia.

'Swiftly dial back' interest rates, ECB told

Italian central banker Piero Cipollone in his first monetary policy speech since joining the ECB's board in November, said that the bank should be ready to "swiftly dial back our restrictive monetary policy stance."

Opinion

EU Modernisation Fund: an open door for fossil gas in Romania

Among the largest sources of financing for energy transition of central and eastern European countries, the €60bn Modernisation Fund remains far from the public eye. And perhaps that's one reason it is often used for financing fossil gas projects.

Latest News

  1. Kenyan traders react angrily to proposed EU clothes ban
  2. Lawyer suing Frontex takes aim at 'antagonistic' judges
  3. Orban's Fidesz faces low-polling jitters ahead of EU election
  4. German bank freezes account of Jewish peace group
  5. EU Modernisation Fund: an open door for fossil gas in Romania
  6. 'Swiftly dial back' interest rates, ECB told
  7. Moscow's terror attack, security and Gaza
  8. Why UK-EU defence and security deal may be difficult

Stakeholders' Highlights

  1. Nordic Council of MinistersJoin the Nordic Food Systems Takeover at COP28
  2. Nordic Council of MinistersHow women and men are affected differently by climate policy
  3. Nordic Council of MinistersArtist Jessie Kleemann at Nordic pavilion during UN climate summit COP28
  4. Nordic Council of MinistersCOP28: Gathering Nordic and global experts to put food and health on the agenda
  5. Friedrich Naumann FoundationPoems of Liberty – Call for Submission “Human Rights in Inhume War”: 250€ honorary fee for selected poems
  6. World BankWorld Bank report: How to create a future where the rewards of technology benefit all levels of society?

Join EUobserver

EU news that matters

Join us