EU Withdraws Report That Criticized Spanish Budget Data

Eurostat, the European Union’s statistics agency, withdrew a report criticizing Spain’s processes for reporting budget data after consultations with the country’s government.

EU statisticians, who had said Spain lacked “initiative” in addressing flaws in its budget figures, removed the report, published in April, from their website in order to revise their comments, Tim Allen, a spokesman for Luxembourg-based Eurostat, said by e-mail.

“Further exchanges with the Spanish authorities have shown that a few statements in the report were too general,” Allen said yesterday. “The report has been temporarily withdrawn for amendment.”

The move marks a retreat for Eurostat after the agency sent an extraordinary mission to Spain in September to follow up urgent concerns stemming from regional officials’ failure to report all their unpaid bills in 2011. Spain has missed EU budget targets since its deficit surpassed 3 percent of gross domestic product in 2009.

Local and regional administrations in Spain need to make “substantial improvements to public accounting and statistical reporting,” the agency said in its April report on the September 2012 visit. “Eurostat notes the lack of initiative and preparedness to follow up the recommendations.”

Increasing Scrutiny

“There are no more bills in the drawers,” Budget Minister Cristobal Montoro said Nov. 7. Even so, local administrations continue to hire companies for jobs, without having the budget, telling suppliers they will be paid when the administration has the funds, he said.

A spokeswoman for the Spanish Budget Ministry declined to comment on the move.

Last week, Bloomberg News reported Eurostat was ratcheting up its scrutiny of Spanish budget procedures on concern that regional officials weren’t responding to EU recommendations to improve their reporting. Expansion, the Spanish business newspaper, yesterday cited the April report as evidence Eurostat was pushing for the Spanish statistics office to be given more power to supervise government data.

Eurostat’s pullback came as Spanish and European officials clashed over a possible reduction in subsidies for Spanish students.

‘That’s Rubbish’

The European Commission’s education spokesman, Dennis Abbott, dismissed analysis from the Spanish Education Ministry suggesting grants for Spanish students to study abroad may be cut by 50 percent from next year.

“I don’t know how to put this any more diplomatically but that’s rubbish,” Abbott said in a televised press conference yesterday. The Spanish figures were “completely wrong,” he added.

EU subsidies of 115 euros ($154) per Spanish student under the Erasmus program, which allows Europeans to study in other member states, may be cut in half from 2014 under a new funding formula, El Pais newspaper reported yesterday, citing Education Ministry analysis. The EU budget for Spanish students studying abroad will be increased by more than 4 percent, Abbott said.

To contact the reporter on this story: Esteban Duarte in Madrid at eduarterubia@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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