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From · opinion parliamentary committee draft · 2023-11-13 EMPL-PA-752903 on discharge in respect of the implementation of the budget of the European Training Foundation

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To · Plenary report · 2024-03-13 A-9-2024-0114 on discharge in respect of the implementation of the budget of the European Training Foundation for the financial year 2022

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1. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

on discharge in respect of the implementation of the budget of the European Training Foundation for the financial year 2022

(2023/2163(DEC))

– having regard to the final annual accounts of the European Training Foundation for the financial year 2022,

– having regard to the Court of Auditors’ annual report on EU agencies for the financial year 2022, together with the agencies’ replies,

– having regard to the statement of assurance as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors for the financial year 2022, pursuant to Article 287 of the Treaty on the Functioning of the European Union,

– having regard to the Council’s recommendation of 22 February 2024 on discharge to be given to the Foundation in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),

– having regard to Article 319 of the Treaty on the Functioning of the European Union,

– having regard to Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012, and in particular Article 70 thereof,

– having regard to Regulation (EC) No 1339/2008 of the European Parliament and of the Council of 16 December 2008 establishing a European Training Foundation, and in particular Article 17 thereof,

– having regard to Commission Delegated Regulation (EU) 2019/715 of 18 December 2018 on the framework financial regulation for the bodies set up under the TFEU and Euratom Treaty and referred to in Article 70 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council, and in particular Article 105 thereof,

– having regard to Rule 100 of and Annex V to its Rules of Procedure,

– having regard to the opinion of the Committee on Employment and Social Affairs,

– having regard to the report of the Committee on Budgetary Control (A9-0114/2024),

1. Grants the Director of the European Training Foundation discharge in respect of the implementation of the Foundation’s budget for the financial year 2022;

2. Sets out its observations in the resolution below;

3. Instructs its President to forward this decision, and the resolution forming an integral part of it, to the Director of the European Training Foundation, the Council, the Commission and the Court of Auditors, and to arrange for their publication in the Official Journal of the European Union (L series).

2. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

on the closure of the accounts of the European Training Foundation for the financial year 2022

(2023/2163(DEC))

– having regard to the final annual accounts of the European Training Foundation for the financial year 2022,

– having regard to the Court of Auditors’ annual report on EU agencies for the financial year 2022, together with the agencies’ replies,

– having regard to Article 319 of the Treaty on the Functioning of the European Union,

– having regard to Regulation (EC) No 1339/2008 of the European Parliament and of the Council of 16 December 2008 establishing a European Training Foundation, and in particular Article 17 thereof,

– having regard to Rule 100 of and Annex V to its Rules of Procedure,

– having regard to the opinion of the Committee on Employment and Social Affairs,

– having regard to the report of the Committee on Budgetary Control (A9-0114/2024),

1. Approves the closure of the accounts of the European Training Foundation for the financial year 2022;

2. Instructs its President to forward this decision to the Director of the European Training Foundation, the Council, the Commission and the Court of Auditors, and to arrange for its publication in the Official Journal of the European Union (L series).

3. MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

with observations forming an integral part of the decision on discharge in respect of the implementation of the budget of the European Training Foundation for the financial year 2022

(2023/2163(DEC))

– having regard to its decision on discharge in respect of the implementation of the budget of the European Training Foundation for the financial year 2022,

– having regard to Rule 100 of and Annex V to its Rules of Procedure,

– having regard to the opinion of the Committee on Employment and Social Affairs,

– having regard to the report of the Committee on Budgetary Control (A9-0114/2024),

A. whereas, according to its statement of revenue and expenditure, the final budget of the European Training Foundation (the ‘Foundation’) for the financial year 2022 was EUR 25 051 848, representing an increase of 17,05 % compared to 2021; whereas the budget of the Foundation derives entirely from the Union budget;

B. whereas the Court of Auditors (the ‘Court’), in its report on the annual accounts of the Foundation for the financial year 2022 (the ‘Court's report’), states that it has obtained reasonable assurance that the Foundation’s annual accounts are reliable and that the underlying transactions are legal and regular;

Budget and financial management

1. Notes with appreciation that budget monitoring efforts during the financial year 2022 resulted in a high budget implementation rate of 99,98 %, representing a slight increase of 0,07 % compared to 2021; points out that the payment appropriations execution rate was 97,70 %, representing an increase of 11,48 % compared to 2021;

2. Welcomes the fact that despite the budget crisis caused by inflation and utilities prices in 2022, the Foundation has been able to effectively manage its expenses, introduce cost-saving measures and reprioritise without major disruptions to its work programme;

Performance

3. Notes with satisfaction that the Foundation uses certain measures as key performance indicators to assess the added value provided by its activities and other measures to improve its budget management;

4. Notes that the Foundation achieved a 93 % activity completion rate, a slight decrease compared to 2021, with a timely completion of 89 %; commends that the Foundation has achieved all the key performance indicators above or well above targets set;

5. Notes the Foundation’s key achievements of 2022, which are based on three strategic objectives: skills relevance and anticipation, skills development and validation, and performance and quality of education and training policies; notes that those objectives are delivered by the Foundation under three core services: knowledge hub, monitoring and assessment, and policy advice;

6. Notes the new initiatives launched by the Foundation in 2022, such as the new Team Europe Initiative in the Southern and Eastern Mediterranean and the network gathering Governance Learning Action and Dialogue (GLAD); notes the growth of its network for excellence and the Foundation´s network for excellence online conference in November 2022 which provided the opportunity for participants to share developments and results on the work of the thematic partnership;

7. Highlights that the Foundation is supporting Moldova, Georgia, and Ukraine as candidate countries in their aspirations to align their education and employment policies with those of the Union, by providing technical expertise and advice on various issues to the national authorities in close cooperation with the Union delegations and Commission services;

8. Welcomes that the measures taken by the Foundation in response to shocks, such as the continued effects of the COVID-19 pandemic and the Russian aggression in Ukraine, were very effective in ensuring a continued and very high level of delivery of the annual work programme; commends the initiative of the Foundation to support Ukraine through the online resource hub for the recognition of qualifications, skills and study periods of Ukrainian refugees, and other means, and to respond, where possible and relevant, in close contact with different Commission services, tapping into its thematic expertise and knowledge of education and training systems of the country;

9. Underlines that the Foundation has suspended all activities and cooperation with Belarusian authorities since the beginning of 2022;

10. Welcomes the Foundation’s activities in helping Union partner countries harness the potential of their human capital and improve the employment prospects of their citizens through the reform of education, vocational training, skills and labour market systems, in the context of the Union’s external relations policies;

11. Welcomes in particular the Foundation’s new concept of entrepreneurial centres of vocational excellence that have been developed to contribute to the international debate in the entrepreneurial learning community, and to inspire training centres to better respond to the changing needs of citizens, economies and societies;

Efficiency and gains

12. Notes that, in 2022, the Foundation continued to identify opportunities to introduce efficiency gains in its operations, such as improving digital workflows and proactively participating in the Union agencies network and its different working groups; notes, among others, the sharing of the Foundation’s accounting services with the European Agency for Safety and Health at Work through a service level agreement signed in 2022 and the evaluation of the possibility of sharing resources in the areas of recruitment, cyber-security, EMAS, sustainability and greening, procurement and IT tools and systems with the European Centre for the Development of Vocational Training;

13. Notes that the Foundation has put in place measures, including in the areas of energy consumption and building management, for example, closing the offices in August 2022, sensors for lighting and water, timers for boilers, heating and air conditioning; notes the increased efforts on energy management that have led to savings of 2,000 mc of gas and 49,107 KwH of electricity in 2022 despite the increased presence of staff in offices throughout the year due to hybrid working arrangements in place;

14. Welcomes the Foundation´s commitment to adopting all the Commission’s e-procurement tools and the fact that Foundation’s procurement process is fully digitalised;

15. Commends the Foundation for having established a corporate plan to improve energy efficiency and climate neutrality of its operations;

Staff policy

16. Notes that, on 31 December 2022, the establishment plan was 98,8 % implemented, with 85 officials and temporary agents appointed out of 86 officials and temporary agents authorised under the Union budget (the same number of authorised posts as in 2021); notes that, in addition, 39 contract agents and one local agent worked for the Foundation in 2022;

17. Notes that 21 Member States were represented among the Foundation’s staff in 2022; reiterates with concern that geographical balance is a challenge; notes that 42 % of the Foundation´s staff are nationals of the Member State where it is located; acknowledges that the Foundation uses merit-based selection procedures, whereby in presence of equal merits, the Foundation would favour the under-represented nationalities; recalls the importance of geographical balance and calls on the Foundation to take the necessary measures to have a balanced and fair geographical representation, including at middle and senior management positions, while at the same time respecting the competences and merits of the candidates and report any developments in that regard to the discharge authority;

18. Notes that the gender balance among middle and senior management in 2022 was four women out of nine posts; notes that the gender balance among the members of the management board is 41 % men and 59 % women (11 and 16 respectively) and among staff overall 33 % men and 67 % women (41 and 84 respectively); recalls the importance to ensure gender balance and calls on the Foundation to take this aspect into consideration with regard to future recruitments of staff and appointments within its middle and senior management; asks the Commission and the Member States to take into account the importance of ensuring gender balance when nominating their members to the Foundation’s management board;

19. Notes that according to the follow up on 2021 discharge observations, the Foundation has revised its vacancy notices to increase the attractiveness of the place of employment and is diversifying the communication channels to target countries which are less represented via LinkedIn;

20. Notes that the Foundation adopted the charter on diversity and inclusion in December 2022; notes that, in 2022, the staff had many benefits to improve the well-being at work and, additionally, new rules were adopted on working time and hybrid working that continue to provide staff with opportunities for new flexible ways of working;

Procurement

21. Takes note of the Court’s observation regarding the award of a EUR 1 million framework contract for content support services, initiated in 2021, according to which it was irregular due to a deviation from technical specifications; notes that tenderers were required to provide closed and signed accounts showing a turnover of at least EUR 250 000 for the last two financial years, namely 2019 and 2020, to demonstrate their financial capacity; observes that the winning tenderer’s turnover for 2019 had not reached the required threshold but, however, the Foundation instead of rejecting the tenderer, decided not to reject it on the basis of the higher turnover shown in the 2021 provisional accounts; highlights the fact that the Court concluded that the evaluation procedure and the resulting contract are irregular and so are all the related payments, which, in 2022, amounted to EUR 100 100; takes note that following the Court’s observation, the Foundation will be simplifying its methodology, which will continue to assess the financial reliability of contractors, however, making it more tailored to the current financial situation (post COVID-19 pandemic and war in Ukraine);

22. Notes that in another open procurement procedure for in-country support services for an amount of EUR 4 million, the tenderers’ financial and economic capacities was to be assessed by two criteria: (i) stable financial position, demonstrated by a set of parameters, including positive net profit; and (ii) a yearly turnover of at least EUR 1 million in the last two financial years; observes that the Foundation awarded the contract to a consortium of five non-commercial entities even though none of the members of the consortium had reported any profits in the last two years, and in addition, it decided to disregard the turnover requirement, which the winning tenderer did not meet, as non-applicable to non-commercial entities; highlights that the Court concluded that the Foundation applied the selection criteria incorrectly and that the economic and financial capacity of the winning tenderer has not been demonstrated; notes furthermore that the evaluation procedure, and the resulting contract, are therefore irregular, as are all the related payments, which, in 2022, amounted to EUR 70 500; observes that the procurement procedure in question was targeting human capital development in Central Asia and following the Court’s observation, the Foundation will pursue discussions with the relevant Commission services on possible alternative methods to implement the activities in its partner countries and in parallel will be simplifying its methodology on financial assessment to target, where applicable, the non-Union market;

23. Recalls the importance, for all procurement procedures, to ensure fair competition between tenderers and to procure goods and services at the best price, respecting the principles of transparency and the sound use of public resources, proportionality, equal treatment and non-discrimination; calls on the Foundation to take actions to guarantee that in future procurement procedures there is full compliance with the applicable rules ensuring transparency, fairness, and integrity in the tendering process;

24. Notes that, at the end of 2022, the Foundation had only one open Court finding on the procurement procedure for interim workers, issued in 2018, and previously acknowledged by the Parliament in its discharge report; notes, additionally, that the Foundation addressed this issue when launching the new framework contract, due to be signed in 2023;

Prevention and management of conflicts of interest and transparency

25. Notes that the Foundation published all the declarations of conflict of interest and CVs for management board members, and senior and middle managers; notes, furthermore, that the Foundation lists all meetings held by its director and organisations and self-employed individuals on its website;

26. Notes that the Foundation has an internal anti-fraud strategy, which is regularly updated, and it may consider complementing that strategy with an anticorruption section; further notes that it is now developing a policy on conflicts of interest issues;

Internal control

27. Welcomes the positive opinion the internal audit service issued on the complementarity and cooperation mechanisms between the Foundation and the Commission in its final audit report in December 2022 highlighting the Foundation’s staff expertise and the set up of a bi-annual structured dialogue to ensure better coordination for the preparation of governing board meetings; observes that, nevertheless, the internal audit service also points out two very important issues regarding the Foundation's mandate and monitoring of indicators, as well as two important issues on priority alignment and Union requests database and procedure improvements; acknowledges that in response, the Foundation, in collaboration with DG EMPL, has devised an action plan to tackle those recommendations, which were to come into effect in 2023;

Other comments

28. Notes the Foundation’s dedicated attention to cyber security and digital records and data management and the actions undertaken in order to follow the relevant guidelines from the Union, such as backup improvements and the Foundation’s main websites’ penetration tests; notes, additionally, that following a Foundation-wide information security risk assessment performed in 2021, a risk treatment plan was developed and agreed in 2022;

29. Notes that, in 2022, the Foundation retained both the EMAS certification and the ISO 14001 certification following an environmental audit carried out in March 2022 (and 2023);

30. Welcomes the fact that the Foundation has continued to implement different measures to increase its public and online presence, including through the production and promotion of 10 podcasts, two international awards and 10 joint communications, the streaming of seven LIVE LearningConnects interviews, and taking part at the UN COP conference to present its work on green skills; notes in that context a significant increase in the Foundation’s social media metrics in 2022 compared to 2021;

31. Reiterates its call on the Foundation to ensure greater transparency and public accountability by better-utilising media and social media channels;

° °

32. Refers, for other observations of a cross-cutting nature accompanying its decision on discharge, to its resolution of ... on the performance, financial management and control of the agencies.

ANNEX: ENTITIES OR PERSONS FROM WHOM THE RAPPORTEUR HAS RECEIVED INPUT

The rapporteur declares under his exclusive responsibility that he did not receive input from any entity or person to be mentioned in this Annex pursuant to Article 8 of Annex I to the Rules of Procedure.

5.2.2024

OPINION OF THE COMMITTEE ON EMPLOYMENT AND SOCIAL AFFAIRS

for the Committee on Budgetary Control

on discharge in respect of the implementation of the budget of the European Training Foundation

(2023/2163(DEC))

Rapporteur for opinion: Romana Tomc

SUGGESTIONS

1. Expresses its satisfaction that the European Court of Auditors (the ‘Court’) has declared the transactions underlying the European Training Foundation’s (Foundation’s) annual accounts for the financial year 2022 to be legal and regular and that its financial position as of 31 December 2022 is fairly represented;

2. ~~Appreciates~~Welcomes the Foundation’s activities in helping ~~transition and~~Union ~~developing~~partner countries harness the potential of their human capital and improve the employment prospects of their citizens through the reform of education, vocational training, skills and labour market systems, in the context of the Union’s external relations policies;

3. Notes that, the budget of the Foundation for the financial year 2022 amounted to EUR 25 million (EUR 21 million in 2021); expresses its satisfaction that the Foundation’s budget for 2022 was executed by 97.7%;

3. Welcomes in particular the Foundation’s new concept of entrepreneurial centres of vocational excellence (CoVEs) that have been developed to contribute to the international debate in the entrepreneurial learning community, and to inspire training centres to better respond to the changing needs of citizens, economies and societies;

4. Welcomes the fact that despite the budget crisis caused by inflation and utilities prices in 2022, the Foundation has been able to effectively manage its expenses, introduce cost-saving measures and reprioritise without major disruptions to is work programme;

4. Welcomes that the budget of the Foundation for the financial year 2022 increased up to EUR 25 million (EUR 21 million in 2021); expresses its satisfaction that the Foundation’s budget for 2022 was executed by 97.7%; highlights the need to keep ensuring adequate human and financial resources allowing the Foundation to fulfill its mandate and continue implementing its work programme with a very high activity completion rate;

5. Recognises that the Foundation’s objectives and actions are closely aligned with EU policies and activities in the field of vocational education and training, human development, skills and migration; welcomes the Foundation’s continued cooperation and sharing of resources with other agencies, in particular with Cedefop and Eurofound, which enables significant knowledge sharing;

5. Welcomes the fact that despite the budget crisis caused by inflation and utilities prices in 2022, the Foundation has been able to effectively manage its expenses, introduce cost-saving measures and reprioritise without major disruptions to is work programme;

6. Notes with concern that the Court reported weaknesses in some public procurement procedures; calls on the Foundation to further improve its public procurement procedures, ensuring full compliance with the applicable rules, to ensure they achieve the best possible value for money, notably by simplifying its methodology and together with relevant Commission services discuss possible alternative methods to implement activities in the Foundation’s partner countries;

6. Stresses the importance of the Foundation’s work and added value in its field of expertise; recognises that the Foundation’s objectives and actions are closely aligned with EU policies and activities in the field of vocational education and training, human development, skills and migration; welcomes the Foundation’s continued cooperation and sharing of resources with other agencies, in particular with Cedefop and Eurofound, which enables significant knowledge sharing;

7. Recommends, on the basis of the facts available, that discharge be granted to the Director ad Interim of the European Training Foundation’s in respect of the implementation of the Foundation’s budget for the financial year 2022.

7. Notes with concern that the Court reported weaknesses in two public procurement procedures, in particular on the legality and regularity of transactions, related to the lack of financial solvency of the tenderers proposed by the Foundation; calls on the Foundation to further improve its public procurement procedures, ensuring full compliance with the applicable rules, to ensure they achieve the best possible value for money, notably by simplifying its methodology and together with relevant Commission services discuss possible alternative methods to implement activities in the Foundation’s partner countries;

8. Commends the Foundation for having established a corporate plan to improve energy efficiency and climate neutrality of its operations;

9. Recommends, on the basis of the facts available, that discharge be granted to the Director ad Interim of the European Training Foundation’s in respect of the implementation of the Foundation’s budget for the financial year 2022.

ANNEX: ENTITIES OR PERSONS FROM WHOM THE RAPPORTEUR HAS RECEIVED INPUT

The rapporteur declares under her exclusive responsibility that she did not receive input from any entity or person to be mentioned in this Annex pursuant to Article 8 of Annex I to the Rules of Procedure.

INFORMATION ON ADOPTION IN COMMITTEE ASKED FOR OPINION

Date adopted

11.1.2024

Result of final vote

–:

Members present for the final vote

João Albuquerque, Atidzhe Alieva-Veli, Dominique Bilde, Vilija Blinkevičiūtė, Milan Brglez, Jordi Cañas, David Casa, Leila Chaibi, Ilan De Basso, Jarosław Duda, Estrella Durá Ferrandis, Lucia Ďuriš Nicholsonová, Cindy Franssen, Chiara Gemma, Helmut Geuking, Elisabetta Gualmini, Agnes Jongerius, Radan Kanev, Ádám Kósa, Katrin Langensiepen, Elena Lizzi, Sara Matthieu, Jozef Mihál, Max Orville, Dennis Radtke, Antonio Maria Rinaldi, Mounir Satouri, Monica Semedo, Eugen Tomac, Romana Tomc, Nikolaj Villumsen, Maria Walsh

Substitutes present for the final vote

Catherine Amalric, Romeo Franz, Lina Gálvez Muñoz, José Gusmão

Substitutes under Rule 209(7) present for the final vote

Maria Noichl, Carina Ohlsson, Vera Tax

FINAL VOTE BY ROLL CALL IN COMMITTEE ASKED FOR OPINION

Key to symbols:

INFORMATION ON ADOPTION IN COMMITTEE RESPONSIBLE

Date adopted

4.3.2024

Result of final vote

–:

Members present for the final vote

Dominique Bilde, Olivier Chastel, Caterina Chinnici, Ilana Cicurel, Carlos Coelho, Daniel Freund, Isabel García Muñoz, Monika Hohlmeier, Joachim Kuhs, Markus Pieper, Petri Sarvamaa, François Thiollet

Substitutes present for the final vote

Katalin Cseh, Bas Eickhout, Hannes Heide, Sabrina Pignedoli, Wolfram Pirchner

Substitutes under Rule 209(7) present for the final vote

César Luena, Miguel Urbán Crespo

FINAL VOTE BY ROLL CALL IN COMMITTEE RESPONSIBLE

Key to symbols: