Malta's annual VAT contributions to the EU coffers and some spending in the agricultural sector have not yet been given the green light by the European Court of Auditors, the EU's watchdog on how funds are spent.
According to the last report for 2008, by the end of last year Malta had six pending VAT reservations on its contributions to the EU budget since its accession to the EU in 2004. This means that Malta's contribution can still be corrected if any administrative miscalculations are found.
Describing the reservations as a normal accounting process, a spokesman for the ECA said that, in the case of Malta, the six reservations were placed in 2007 and discussions with the Maltese authorities were still ongoing on the clarifications requested.
"In these cases, the Commission has asked for clarifications or corrections on data concerning various elements of the VAT statements sent, such as interests paid on VAT statements made, new constructions and transport of persons."
The spokesman said almost all of the EU member states had similar reservations. "It should be noted that reservations are a device for the Commission to keep doubtful elements in the VAT statements submitted by member states open for correction after the statutory time-limit of four years. As such, reservations are a useful management tool to safeguard EU revenue," he explained.
The other Maltese outstanding issue in the latest ECA audit deals with some spending in the agricultural sector where about €5 million spent under two particular funds, one on direct payments to farmers and the other on rural development, have still not been cleared by the Commission.
Even in this case, the ECA spokesman said that this might just be an accounting issue. "In practice, this means that the accounts that have been disjoined (not cleared) will normally be accepted at a later stage, when the additional inquiries were satisfactorily replied to," he said.
Malta contributes millions of euros to the EU budget every year as part of its membership obligations. It is however a net beneficiary in terms of the funds it receives from the EU because it is considered as a member state that still has to catch-up with the EU's average GDP.
Between accession in May 2004 and the end of last year, Malta contributed €253 million to the EU coffers and received €462 million in various funds including contributions towards infrastructure projects, training programmes and direct payments towards various sectors of the economy including industry and agriculture. Until the end of 2013, Malta will still be eligible to receive more funds than it contributes.