The EU needs to rethink its budget approach to ensure citizens get a fair deal for their money, auditors said as they reported an increase in spending errors for 2012.
The European Court of Auditors said the error rate for spending rose to 4.8 percent in the 2012 EU budget of nearly 139 billion euros, from 3.9 percent in 2011.
Errors are not fraud or waste but "an estimate of the money that should not have been paid out because it was not used in accordance with the legislation concerned," a statement said.
The ECA, an independent unit of the EU, said there should be a "rethink of EU spending rules and recommends simplifying the legislative framework."
The upcoming multi-annual 2014-20 budget, agreed to only after tough talks in which Britain secured the first ever overall spending reduction at 3 percent, "looks likely to remain expenditure oriented," it said.
This means it is "designed for getting the EU budget allocated and spent, rather than focusing on the value it is intended to bring."
ECA President Vitor Caldeira said "Europe's citizens have a right to know what their money is being spent on and whether it is being used properly.
"They also have a right to know whether it is delivering value, particularly at a time when there is such pressure on public finances," Caldeira said in the statement.
The ECA listed rural development, environment, fisheries and health as the most affected with an error rate of 7.9 percent, followed by regional policy, energy and transport at 6.8 percent.
It said its findings are meant to help the EU improve its financial management and they "should be fully taken into account" in the rules laid down for the 2014-20 budget.