The European Court of Auditors has identified significant transparency shortcomings in the EU’s Covid recovery fund. The Recovery and Resilience Facility (RRF) was the largest joint borrowing instrument in the history of the European Union. By the end of January 2026, it amounted to €577bn ($666bn).
The fund was designed to stabilize Europe's economy after the pandemic, finance reforms and support investment. To access the money, member states submitted national recovery and resilience plans containing projects, reforms, milestones and targets. EU payments were tied to the achievement of those milestones.
According to the court, that mechanism lies at the heart of a key problem. The RRF operates under a principle known as “financing not linked to costs". In practice, this means that payments to member states depend on the completion of agreed milestones rather than on the actual costs incurred. As a result, funds can be disbursed without the public being able to fully trace the costs of individual measures or identify who ultimately benefited economically.
Ivana Maletić, the auditor responsible for the report, summarized the issue bluntly: “We do not have a complete picture of how RRF funds have been used." Transparency, she argued, is not a formality but a “prerequisite for trust and accountability towards citizens".
The Trail Often Ends with Government Agencies
Member states are required to publish the 100 largest final recipients of RRF funding in their respective countries. At first glance, this appears to provide a reasonable level of transparency. In practice, however, the Court of Auditors argues that the requirement falls short.
In many cases, the published lists do not identify the companies that ultimately carry out projects or benefit financially. Instead, ministries, government agencies and other public bodies appear as recipients because they receive the funds before redistributing them or awarding contracts. Although these entities merely pass the money on, they are still recorded as final recipients in official disclosures.
The auditors consider this approach inadequate. The published information often reveals only the first public-sector destination of the funds rather than the private contractors that ultimately receive them.
According to the report, public bodies account for more than half of the 100 largest recipients. Measured by value, they receive more than 80% of all funds included in those rankings. For citizens, this frequently makes it impossible to determine which private companies were paid, for what purpose and under which contracts.
Germany and France Lag Behind
The willingness of member states to provide information also varies considerably.
Several countries systematically collect data on final recipients, contractors and actual project costs. Among those highlighted by the auditors are Austria, Bulgaria, Estonia, Latvia, Malta and Romania. Spain and the Netherlands also gather substantial amounts of information, although actual cost data are not always available through a central system.
Germany and France performed significantly worse in terms of transparency. Certain data are not collected continuously at a central level and must instead be assembled upon request. This makes rapid analysis, comparison and oversight more difficult. In France, auditors were initially unable to obtain all legally required information for several measures under review.
Spain also faced criticism. Authorities published budgeted or committed amounts for the 100 largest recipients rather than the sums actually received. As a result, public disclosures do not provide the level of accuracy necessary for meaningful scrutiny.
The Court of Auditors pointed to Bulgaria as a positive example. A public online portal allows users to view detailed information on recipients, contractors, payments and implementation progress. The report suggests that greater transparency is technically possible and already being practiced in some member states.
The broader conclusion is that, for much of the money distributed under the RRF, the public can identify only the administrative body through which the funds passed. It is often unclear who ultimately received the money, for which projects and for what purpose.
Brussels Does Not Track Costs Systematically
Oversight of actual project costs remains incomplete.
Many member states possess detailed cost information, but the European Commission does not systematically request such data for individual measures. The Commission argues that the RRF regulation does not provide a clear legal basis for doing so. The Court of Auditors regards this lack of clarity as a significant weakness.
Without information on actual costs, the Commission has only limited ability to assess whether funds were spent efficiently. This is particularly important because many measures were originally based on estimated costs. In several completed projects reviewed by auditors, actual expenses turned out to be lower than projected.
The savings generated by those lower costs were not systematically reallocated. As a result, questions remain about how funds were ultimately used when the original measures required less money than anticipated.
Daniel Freund, a Green member of the European Parliament responsible for the Commission's budget discharge procedure, described the situation as a “scandal".
“These are billions of euros in taxpayers' money. The fact that we still do not know where the funds have gone is unacceptable", Freund said. He called on the Commission to ensure that all member states disclose the true final recipients of the money.
The Court of Auditors recommends a comprehensive and timely collection of data, publication of information on public and private recipients, contractors and subcontractors, and greater use of actual cost data when evaluating efficiency
A Test Case for Future EU Debt
The report is more than a technical audit.
In Brussels, the RRF is widely regarded as a possible model for future joint EU borrowing programs. Discussions surrounding the next long-term EU budget already involve significantly larger financial commitments. Against that backdrop, the finding that the destination and impact of recovery funds cannot always be fully traced carries substantial political weight.
Weak transparency creates conditions in which waste, mismanagement and corruption may become more difficult to detect, while effective oversight remains limited.
The RRF was originally conceived as an emergency recovery instrument. The Court of Auditors has now turned it into a test case for future debates over common European debt. If the EU continues to borrow collectively, the report argues, it will not be enough to verify milestones and transfer funds to national governments. Citizens must also be able to see who ultimately receives the money and whether spending achieves its intended objectives.
That is precisely where the current system falls short. According to the auditors, critical information about recipients, costs and outcomes remains missing in a program worth €577bn. That would be problematic in any public funding scheme. In the largest joint borrowing experiment in EU history, it is a matter of major political significance.