Saturday

24th Jun 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.

Row between EU ministers halts e-book tax rate

A bill to reduce VAT rates on e-books and e-publications has become the latest victim of a row between the Czech Republic and its partners over its own plan to collect VAT.

Focus

EU and China move to fill US void

At a summit in Brussels, EU and Chinese leaders will attempt to deepen ties on trade and climate as US president Trump plans to pull out of the Paris climate deal.

Italy reaches EU deal on failing bank

After months of negotiations, the European Commission and Italy agreed on the terms of rescue for Monte dei Paschi di Siena bank, including job cuts, salary caps and private sector involvement in the bailout.

News in Brief

  1. Merkel and Macron hold symbolic joint press conference
  2. Juncker has 'no' clear idea of kind of Brexit UK wants
  3. Belgian PM calls May's proposal on EU citizens 'vague'
  4. UK lacks support of EU countries in UN vote
  5. Spain to command anti-smuggler Mediterranean force
  6. Estonia confirms opposition to Nord Stream 2 pipeline
  7. Ireland and Denmark outside EU military plan
  8. EU leaders renew vows to uphold Paris climate deal

Stakeholders' Highlights

  1. EPSUOn Public Services Day, Stop Austerity! Workers Need a Pay Rise!
  2. EGBAOnline Gambling: The EU Court Rejects Closed Licensing Regimes In Member States
  3. World VisionFaces of Today, Leaders of Tomorrow: Join the Debate on Violence Against Girls - 29 June
  4. ECR GroupThe EU Must Better Protect Industry from Unfair Competition
  5. Malta EU 2017Better Protection for Workers From Cancer-Causing Substances
  6. EPSUAfter 9 Years of Austerity Europe's Public Sector Workers Deserve a Pay Rise!
  7. Dialogue PlatformGlobalised Religions and the Dialogue Imperative. Join the Debate!
  8. UNICEFEU Trust Fund Contribution to UNICEF's Syria Crisis Response Reaches Nearly €200 Million
  9. EUSEW17Bringing Buildings Into the Circular Economy. Discuss at EU Sustainable Energy Week
  10. European Healthy Lifestyle AllianceCan an Ideal Body Weight Lead to Premature Death?
  11. Malta EU 2017End of Roaming Charges: What Does It Entail?
  12. World VisionWorld Refugee Day, a Dark Reminder of the Reality of Children on the Move

Latest News

  1. Macron’s investment screening idea watered down by leaders
  2. Leaders unimpressed by May’s offer to EU citizens
  3. New Irish PM praises unscripted nature of EU summits
  4. EU extends sanctions on Russia
  5. UK's universities set 'Brexit wish list'
  6. Decision on post-Brexit home for EU agencies postponed
  7. May's offer on citizens’ rights dismissed as ‘pathetic’
  8. 'Historic' defence plan gets launch date at EU summit