Mr. Tony Murphy:

State aid is a very complicated area, as the Senator knows. It is a very complex, technical issue. Within the Commission, we have the Directorate-General for Competition, DG COMP, which is ultimately responsible for ensuring state aid rules are respected by member states. What happens for us is that if we have a project where we think there is a state aid involvement, we check the compliance with the rules but we do not set those rules. Basically, we see if the rules are being correctly implemented. This is being managed on a continuous basis by DG COMP.

In terms of fraud, €538 million is a lot of money, especially given that it does not involve many cases. It is only 37 cases, which is a very small number in comparison to the number of cases being handled by OLAF, for example. There are also cases that are referred by the audit divisions in the different DGs and they are much bigger than us. There are country desks in a lot of the DGs that follow specific member states. They would be more aware of things in individual member states. The Commission has implemented anti-fraud strategies but they obviously do not work fully. Fraud, by its nature, involves people who are very clever and very good at getting around the rules. It is very easy to have a paper trail which looks perfect but the reality behind it may not be the same. There are lots of anti-fraud initiatives at Commission level, including the Arachne database, which tries to check for inconsistencies between beneficiaries. There are anti-fraud strategies in place in the DGs. Also, under the RRF, every payment claim that comes from member states includes a management declaration which basically says that the EU budget is protected and that the national and EU rules are respected. This puts the onus on the member states to ensure that happens. That is an issue for us in terms of how we are going to audit the RRF because the Commission has made the member states responsible for the money they receive. Member states are the beneficiaries and it is up to them to make sure that proper fraud prevention measures are in place. The amount of money involved, with the emergency response to Brexit, the RRF and the MFF from 2014 to 2020 still being completed up and the MFF for 2021 to 2027 already up and running, is enormous. There is a lot of funding available and the rush to spend funds obviously increases the risk of fraud, which everyone must be aware of and keep an eye out for.