CORRUPTION across Europe is "breathtaking" and amounts to around £100 billion a year, equivalent to the total EU budget, according to the European Commission.
The first report of its kind to be undertaken across all 28 member states said that corrupt practice affected some 43% of businesses across the bloc and an increasing number of EU citizens think it is getting worse.
Construction companies, which often tender for government contracts, claimed to be the most affected, with almost eight in 10 complaining of corruption. "Europe's problem is not so much with small bribes on the whole," explained Carl Dolan, of Transparency International in Brussels. "It's with the ties between the political class and industry," he said.
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"There has been a failure to regulate politicians' conflicts of interest in dealing with business. The rewards for favouring companies, in allocating contracts or making changes to legislation, are positions in the private sector when they have left office rather than a bribe."
The Commission's report was published shortly after Romania's former Prime Minister, Adrian Nastase, was sent to jail for four years for taking bribes. He was the first premier to be put behind bars since the collapse of communism in Europe in 1989.
Publishing the report, Cecilia Malmstroem, the EU Home Affairs Commissioner, said corrupt practice was eroding trust in democracy and draining resources from the legitimate economy.
"One thing is very clear: there is no 'corruption-free' zone in Europe. The political commitment to really root out corruption seems to be missing. The price of not acting is simply too high."
The commissioner stressed that corruption undermined citizens' confidence in democratic institutions and the rule of law, it hurt the European economy and deprived states of much-needed tax revenue.
"Member states have done a lot in recent years to fight corruption but today's report shows that it is far from enough," she added.
The report recommended better controls and a redoubling of enforcement.
It explained experiences of corrupt practice varied across the EU with almost all companies in Greece, Spain and Italy believing it widespread, while few did so in Denmark, Finland and Sweden.
In the UK only five people out of 1115 surveyed - below 1% - said they had been expected to pay a bribe. This, according to the report, was "the best result in all Europe".
While 64% of British respondents said they believed corruption to be widespread across the UK, this was lower than the EU average of 74%.
The UK was among member states criticised for not regulating the financing of political parties and was asked to "cap donations to political parties, impose limits on electoral campaign spending and ensure proactive monitoring and prosecution of potential violations".
In some member states, the report found there was a relatively high number of people reporting personal experience of bribery.
For example, in Croatia, the Czech Republic, Lithuania, Bulgaria, Romania and Greece, between 6% and 29% of people said they had been asked for a bribe or had been expected to pay one in the past 12 months.
There were also high levels of bribery in Poland, Slovakia and Hungary - 15%, 14% and 13% respectively - where the most prevalent instances of corrupt practice were in healthcare.
The EU has repeatedly raised concerns about a failure to tackle high-level corruption in Romania and Bulgaria, the bloc's two poorest members.
They have been blocked from joining the passport-free Schengen zone over the issue since their entry.