Europe in crisis: EU fat cats shared the rich cream of patronage with their pet cronies

THE LINE of shiny, black limos parked outside the European Commission's Breydel building in Brussels told its own story. It usually takes a crisis to draw all 20 Commissioners to their official workplace on a Monday, but that may be an under statement for the convulsions gripping the upper reaches of the European Union.

As the presses worked overtime churning out English and French copies of a long-awaited inquiry into cronyism, fraud and corruption in Brussels, the sense of a drama permeated the ranks. In a lift in the European Parliament, one secretary was overheard confiding that she was so excited she had been unable to sleep.

On trial are not only thoseCommissioners whose personal and political failings have been well documented, but the culture in which they operate. Never before has the Commission, the unelected and often arrogant executive of the EU suffered such intense scrutiny, knowing the way it responds will shape the future of Europe's institutions.

The crisis convulsing the EU sprang from the work of a worthy but dull committee of the European Parliament, whose task it was to examine the Union's accounts for 1996. Threats made earlier this year that the MEPs would not approve the accounts looked lame until, on the eve of a crucial vote, the Commission circulated a "back us or sack us" ultimatum. To the shock of its cosseted members, the Commission gambled on a macho tactic and lost: the vote went the other way.

That defeat was followed by a censure motion in Strasbourg, put down in the expectation that it would be heavily defeated. (To be successful, and sack all 20 Commissioners, a two-thirds majority is needed). At this point the Commission made its next big error, by arrogantly suspending a whistle-blowing auditor who leaked an extensive dossier of irregularities to the Greens in the European Parliament.

Paul van Buitenen's revelations were seized on as new and flagrant abuses on the part ofEdith Cresson, the Education and Research Commissioner and Manuel Marin, a Vice President of the Commission. In January, MEPs came close to voting the entire Commission out of office, only pulling back when they were promised a thorough, independent inquiry.

Mr Marin, from Spain is under attack over administration of the multi- billion pound humanitarian aid budget, "Echo", which he controlled until 1995, and a programme to help Mediterranean countries But it is Ms Cresson, the abrasive former French premier, who is at the heart of of the row, facing criticism on two fronts.

The first is her administration of the Leonardo da Vinci youth training programme, the day-to-day handing of which was contracted out to a private company called Agenor. The director's wife and his future daughter-in- law were both hired to run the programme, and the boss's salary was found to be around pounds 6,000 a month.

Worse are separate nepotism claims, the most damaging of which was Ms Cresson's decision to employ a dentist from her home town of Chatellerault as a scientific visitor. Rene Berthelot spent only a month working before suffering a heart attack, but stayed on the payroll, earning a total of around pounds 60,000.

Ms Cresson denied the most serious charge, that she sought to block the recovery of money paid to Mr Berthelot for work never performed, but that has not stopped her name becoming a byword for Brussels cronyism. The joke is that if you call her office, the switchboard is liable to say: "I'm sorry, Ms Cresson's line is busy. Can I put you through to her dentist?".

The Cresson case has wider significance because the Commission - the institution not just the 20 Commissioners - has fallen victim to its own supreme aloofness and disregard for its public perception. From the beginning, its handling of the fraud allegations has made matters worse. Queries from MEPs and even police were brushed aside, journalists who reported the allegations were threatened with libel writs.

When it did examine its own structures, the Commission faced an uphill task to root out the type of cronyism and mismanagement now viewed as endemic. Brussels has no agreed administrative culture; what is cronyism in one country is legitimate use of patronage in another and such practises have seeped into the hybrid Brussels bureaucracy.

One of the most notorious practises in the Commission is an accepted fact of life even among the British. This is the phenomenon known as le parachutage where members of Commissioners' private offices - most of whom do not sit the normal recruitment exams - are dropped into the juiciest permanent positions.

The Portuguese commissioner, Joao de Deus Pinheiro, sees nothing wrong with employing his brother-in-law as deputy chef de cabinet, one of the most senior positions in the private office. Mr Pinheiro's wife is also an employee of the Commission, as is Mr Marin's.

Some Commissioners and their staff are hard working but others are not and some of those who are well-intentioned discover that their portfolios do not make up a full-time job.

Much comes down to personal inclination; according to one top official, the directorate of Martin Bangemann, the Industry Commissioner, "has done almost nothing for the last three years". Marcelino Oreja, the Spanish Commissioner has made almost no impact and a recent poll of European newspapers produced a league table of performance listing, among the bottom six, the Environment Commissioner, Ritt Bjerregaard ("as invisible as CO2"), and Christos Papoutsis, who is in charge of energy policy.

It is, of course, an irony that it is the Parliament, which has its own gravy train image, should have provoked such a crisis. But what started as a dispute over a set of figures has turned into Brussels's biggest institutional clash for years. With the Commission looking vulnerable, and European elections looming, MEPs, so long the Cinderellas of the European political power game, saw a golden opportunity for revenge.

Yet Ms Cresson - the clearest target - has shown a determined reluctance to quit, similar to her refusal to resign when she was prime minister of France (she was eventually sacked by Francois Mitterrand). She is also locked in a bitter dispute with Jacques Santer, the European Commission President, who, she believes, is lining her up to be a scapegoat.

MEPs have been quick to up the ante, arguing that if Mr Santer does not act, his head will be on the line. The Commission President does not have the power to fire a Commissioner, but he can refer their case to the European Court of Justice which has the power to "compulsorily retire" the person in question. Mr Santer probably needs the backing of a majority of Commissioners to do that.

As they prepared for a crisis meeting last night, the stage was set for a dramatic denouement. The 20-strong college of Commissioners is not of one view: there are divisions between those due to retire, and those hoping to serve again. There are personal friendships and rivalries and there is an awareness that decisions taken will set a precedent for the future. As one source put it: "All 20 will sit around the table and eyeball each other. That's always a tough thing to do - no matter how courageous you are as a politician."

Few doubt that, whatever the outcome, the politics of Brussels has changed for good.

europe in crisis - the leading players

EDITH CRESSON

Never the most popular of European Commissioners, Ms Cresson, 65, has been thrown to the centre stage of the cronyism row. But as a woman who made her name as France's first female premier her hallmark is toughness and she has shown no desire to quit. Still best known in Britain for casting doubt on the sexuality of a quarter of all Englishmen, Ms Cresson's lack of tact has made matters worse in this case, too. In January, when she appeared before the European Parliament, she struck a arrogant tone and an eleventh-hour charm offensive, both in the media and among MEPs, may have been left too late.

MANUEL MARIN

The 49-year-old Spanish Socialist is one of the youngest members of the Commission and also its longest serving, having been appointed by Madrid in 1986, the year Spain joined the EU. A high achiever at any early age, Mr Marin's star has been fading ever since. A brooding, isolated and melancholic figure, he has not displayed much charisma or understanding of the demands of public relations. Irregularities relating to his office's recruitment of consultants - known as "submarines" because they were invisible - are now under police investigation but Mr Marin denies any personal wrongdoing.

PAULINE GREEN

The leader of the 214-strong group of socialist MEPs, Ms Green has played a crucial role in the crisis even if, by her own admission, things have not turned out as she expected. The 50-year-old MEP for London North called the censure motion, which plunged the EU into crisis in January, in the expectation that it would be voted down. The events in January, when Parliament came closer than ever before to voting the Commission out of office, marked a decisive turning point. Ms Green now argues that, unless Jacques Santer, acts to remove anyone criticised in the report, it will be his "head on the block".

JACQUES SANTER

The former prime minister of Luxembourg emerged from obscurity to succeed Jacques Delors as Commission President when John Major vetoed the majority choice - Belgium's Jean-Luc Dehaene - at the Corfu summit in 1994. Apart from keeping already well-laid plans for the launch of the Euro on a relatively even keel, Mr Santer has not come up with a single memorable initiative. An avuncular, mild-mannered man known as Jacques Sancerre because he enjoys fine wines, the 62- year-old President has yet to convince MEPs that he has the clout to push through the crackdown on cronyism he promised in January.