Tuesday

28th Mar 2017

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.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

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.

SMEs lack support in EU financial plan

The European Commission's plan for a capital markets union is said to be aimed at small and medium-sized enterprises, but many could end up being left out in the cold.

Stolen Russian billions ended up in EU states

Illicit money flowing out of Russia ended up in almost every single EU state, an investigation has found, posing questions on the integrity of Europe’s banking systems.

News in Brief

  1. Scottish MPs give go ahead to seek referendum
  2. Uber pulls out of Denmark over new taxi-regulation
  3. EU court validates sanctions on Russia's Rosneft
  4. Luxembourg to team up with Ireland in Apple tax appeal
  5. EU majority against GM crops, but not enough to block them
  6. Turkish referendum voting starts in Europe
  7. Le Pen says she lacks election funds
  8. UN dinner for Cyprus leaders to restart stalled peace talks

Stakeholders' Highlights

  1. The Idealist QuarterlyCan Progressive Stories Survive Our Post-Truth Era? After-Work Discussion on 6 April
  2. ACCAG20 Citizens Want 'Big Picture' Tax Policymaking, According to Global Survey
  3. Belgrade Security ForumCall for Papers: European Union as a Global Crisis Manager - Deadline 30 April
  4. European Gaming & Betting Association60 Years Rome Treaty – 60 Years Building an Internal Market
  5. Malta EU 2017New EU Rules to Prevent Terrorism and Give More Rights to Victims Approved
  6. European Jewish Congress"Extremists Still Have Ability and Motivation to Murder in Europe" Says EJC President
  7. European Gaming & Betting AssociationAudiovisual Media Services Directive to Exclude Minors from Gambling Ads
  8. ILGA-EuropeTime for a Reality Check on International Day for the Elimination of Racial Discrimination
  9. UNICEFHuman Cost to Refugee and Migrant Children Mounts Up One Year After EU-Turkey Deal
  10. Malta EU 2017Council Adopts New Rules to Improve Safety of Medical Devices
  11. Nordic Council of MinistersNordic Energy Research: How to Reach 100 Percent Renewable Energy
  12. Party of European SocialistsWe Must Renew Europe for All Europeans