29th Jun 2022

EU institutions wasting money on buildings

The EU is wasting money by negotiating construction deals behind closed doors instead of using open tenders and by renting instead of buying many of its own buildings, a fresh Court of Auditors report says.

"Institutions use the negotiated procedure extensively - rather than competitive tendering - for construction and works [despite case studies showing that open tenders cut costs]," court member Morten Louis Levysohn told MEPs in Brussels on Tuesday (26 June).

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  • The European quarter in Brussels as seen through a window from the commission's HQ, the Berlaymont building (Photo: Wikipedia)

"Institutions have rented buildings on a long-term basis without an option to purchase, which makes subsequent acquisition more expensive," he added, pointing out that court advice in the area has been ignored since 1979.

The survey also complained that "detailed information on the number of staff and surface areas" used by the EU was "imprecise" in a budgetary area that accounts for €345 million a year of spending.

The so-called "court" has no powers to enforce its recommendations and does not tackle fraud - its regular critiques over lax accounting of the total €100 billion a year EU budget have come and gone without much impact for the past 12 years.

But its picture - of "imprecise" information on staff and buildings size, as well as the preference for cosy "negotiated settlements" - puts in context two recent buildings-related problems.

In April, the European Commission said €44 million of cleaning contracts "may have been executed in an irregular manner" after Belgian press alleged EU officials were skimming cash paid out for cleaning work that had never been done.

In April last year, MEPs discovered Strasbourg authorities had overcharged rent by over €2 million a year for 25 years. "I do not know anybody in this building, in our wonderful European Parliament, who knows what is going on," German deputy Markus Ferber said at the time.

An EU official on Tuesday explained that a new commission policy paper in late July will try to improve buildings planning between the various EU institutions.

She also said that in the past the commission used to count the number of staff housed in the various EU buildings by looking at telephone directories, but a new central database has been set up since the court drafted its report.

Rough figures

The Court of Auditors survey put forward some rough figures on what the EU has grown to become in material terms over the past 50 years, scattered across its three official homes in Brussels, Luxembourg and Strasbourg.

The institutions employ about 36,000 people housed in some 2 million square metres of office space. Thirty eight percent of the area is rented with €1.8 billion owed on leases at the end of 2005. The total value of EU-owned property is €3.9 billion.

The report also gives an insight into why native Brussels people have such a love-hate relationship with the European Union machine. On one hand, the thousands of well-paid EU officials and lobbyists help support the city's fancy restaurants and boutiques.

But on the other hand, the EU now occupies 50 percent of all office space in the so-called Schuman area of Brussels "which contributes to an increase of prices...due to the higher demand for buildings, as well as a reduction in the accommodation available."

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