Sittings · Document

DRAFT REPORT (2023/2147(DEC)) 2024-01-16

On discharge in respect of the implementation of the budget of the European Centre for Disease Prevention and Control for the financial year 2022

Committee on Budgetary Control · Rapporteur: Petri Sarvamaa

PR_DEC_Agencies

1. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

on discharge in respect of the implementation of the budget of the European Centre for Disease Prevention and Control for the financial year 2022

(2023/2147(DEC))

– having regard to the final annual accounts of the European Centre for Disease Prevention and Control 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 … February 2024 on discharge to be given to the Centre 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 (EU) No 2022/2370 of the European Parliament and of the Council of 23 November 2022 and amending Regulation (EC) No 851/2004 of the European Parliament and of the Council of 21 April 2004 establishing a European Centre for Disease Prevention and Control, and in particular Article 23 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 the Environment, Public Health and Food Safety,

– having regard to the report of the Committee on Budgetary Control (A90000/2024),

1. Grants the Director of the European Centre for Disease Prevention and Control discharge in respect of the implementation of the Centre’s budget for the financial year 2022 / Postpones its decision on granting the Director of the European Centre for Disease Prevention and Control discharge in respect of the implementation of the Centre’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 Centre for Disease Prevention and Control, 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 Centre for Disease Prevention and Control for the financial year 2022

(2023/2147(DEC))

– having regard to the final annual accounts of the European Centre for Disease Prevention and Control 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 Rule 100 of and Annex V to its Rules of Procedure,

– having regard to the opinion of the Committee on the Environment, Public Health and Food Safety,

– having regard to the report of the Committee on Budgetary Control (A90000/2024),

1. Approves the closure of the accounts of the European Centre for Disease Prevention and Control for the financial year 2022 / Postpones the closure of the accounts of the European Centre for Disease Prevention and Control for the financial year 2022;

2. Instructs its President to forward this decision to the Director of the European Centre for Disease Prevention and Control, 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 Centre for Disease Prevention and Control for the financial year 2022

(2023/2147(DEC))

– having regard to its decision on discharge in respect of the implementation of the budget of the European Centre for Disease Prevention and Control 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 the Environment, Public Health and Food Safety,

– having regard to the report of the Committee on Budgetary Control (A90000/2024),

A. whereas, according to its statement of revenue and expenditure, the final budget of the European Centre for Disease Prevention and Control (the ‘Centre’) for the financial year 2022 was EUR 99 872 000, representing an decrease of 40,59 % compared to 2021, as a result of changes in European Health Emergency Preparedness and Response Authority (HERA) grants; whereas the budget of the Agency derives mainly from the Union budget;

B. whereas the Court of Auditors (the ‘Court’), in its report on the Centre’s annual accounts for the financial year 2022 (the ‘Court’s report’), states that it has obtained reasonable assurance that the Centre’s annual accounts are reliable and that the underlying transactions as regards revenue are legal and regular; whereas the Court audited four grant agreements with a total value of EUR 7,9 million and detected that three of those included VAT to the value of EUR 0,6 million (8,1 %) among the eligible costs; whereas the beneficiaries were engaging in activities as public authorities and consequently VAT is not an eligible cost under Article 186(4)(c) of the Financial Regulation; whereas the estimated total amount of non-compliant expenditure based on the rate and amount of VAT found in the sample described above represents 2,8 % of the total payment appropriations available in 2022 which exceeds the materiality threshold set for the audit and, consequently, resulted in a qualified opinion on the legality and regularity of payments underlying the Centre’s accounts; whereas, except for the matter explained above, the Court concluded that the revenue and payments underlying the accounts of the Centre for the year ended 31 December 2022 are legal and regular in all material respects;

C. whereas with regard to the Centre’s procurement sector, no issues requiring corrective actions were reported for 2022, nor are there ongoing or outstanding corrective actions from previous years’ audits and assessments;

Budget and financial management

1. Notes with satisfaction that the budget monitoring efforts during the financial year 2022 resulted in a budget implementation rate of current year commitment appropriations of 98,86%, representing an increase of 0,49 % compared to 2021; notes that the current year payment appropriations execution rate was 73,61 %, representing a increase of 9,53 % compared to the previous year;

Performance

2. Notes that the Centre delivered 89 % of the outputs planned in its Single Programming Document 2022–2024; notes that 8 % of the planned outputs were postponed, while 3 % were delayed or cancelled by the end of the year; takes note that most of the outputs that have been postponed or delayed were dependant on the adoption and publishing of the amended legal text of Centre mandate, which took place in November 2022;

3. Notes that throughout 2022, for the third consecutive year, ECDC maintained its public health emergency (PHE) plan in response to the continuing COVID-19 pandemic; takes note that in June the PHE level was gradually downgraded from Level 2 (Acute Phase) to Level 1 (Maintenance Phase);

4. Notes that following Russia’s aggression in Ukraine and the influx of refugees fleeing the country, the Centre worked with the authorities of the five countries surrounding Ukraine providing technical and operational response activities within its remit, based on identified needs; takes note that in the second half of the year, the focus shifted from operational response to more medium-/longer-term and strategic response actions and the Centre’s experts were deployed to Poland and Romania in support of national authorities and WHO assisting Ukrainian displaced populations;

5. Observes that during the spring and summer of 2022, the Centre supported simultaneously three ongoing PHEs, namely COVID-19, Mpox, and hepatitis of unknown origin in children; notes with appreciation that this experience was unique for ECDC and tested the limits of the Agency’s capacity to develop risk assessments and guidance for multiple health threats;

Efficiency and gains

6. Welcomes that the Centre continued its efforts towards delivering efficiency gains with the introduction of new methodologies, including the automation of support and operational processes; notes that during the year, four new administrative processes were automated through electronic workflows, a new cost-effective solution for the electronic workflows platform was also implemented to replace K2. An overall analysis of the use of the electronic workflows already shows that a significant number of users have adopted them and that they have markedly reduced processing time, due to the elimination of unnecessary steps, while ensuring legal compliance;

Staff policy

7. Notes that, on 31 December 2022, the establishment plan consisted of 215 temporary agents authorised under the Union budget (compared to 208 authorised posts in 2021); notes that, in addition, 112 contract agents and 5 seconded national experts worked for the Centre in 2022;

8. Notes the gender distribution among the Centre’s overall staff, with 198 out of 331 (60 %) being women and 133 out of 331 (40 %) being men; welcomes that the Centre is in progress of adopting the charter on diversity and inclusion and it will be in place by Q4 2023;

Prevention and management of conflicts of interest and transparency

9. Notes that the Centre continued to apply and strengthen its independence policy for non-staff and staff members; observes that in 2022, the Centre lacked a small percentage of declarations; notes furthermore that all external experts consulted during the production of rapid risk assessments declared their interests before publication; notes that all members of the Management Board and Advisory Forum attending the meetings and thus contributing to the discussions had valid annual DoIs and the Director and Heads of Unit filled their annual DoIs as well as 99 % of external experts attending the Centre’s meetings that required a conflict-of-interest check submitted an annual DoI;

10. Takes note that the Centre’s Independence policy for non-staff provides for the procedure to be followed to identify and avoid potential conflict of interests; notes that in summary, this involves the collection of declarations of interests in particular circumstances (e.g. when a scientific output will be produced) which are then assessed by the Centre’s staff member responsible for the relevant activity, with support of the the Centre’s Compliance Officer; notes that no actual conflict of interests was reported in 2022;

11. Notes that the internal procedure on the Centre’s meetings with commercial organisations active in the field of its mandate was developed in 2022 and formally put into force in January 2023; notes furthermore that the Centre did not, however, hold any such meetings in 2022;

Internal control

12. Highlights the Court’s qualified opinion on the legality and regularity of payments due to the inclusion of VAT as eligible expense under grant agreements whose beneficiaries engaging in activities as public authorities representing 2,8 % of the payment appropriations available in 2022; recalls that when managing grants, the Centre should ensure compliance with the applicable rules, in particular regarding the reimbursement of VAT to beneficiaries which are public authorities;

13. Takes note that the Centre assesses the effectiveness of the internal control system at least once a year by assessing the implementation of the internal control framework, including the implementation of the indicators defined, and by evaluating the main shortcomings identified by the Centre itself or reported by others, including the Internal Audit Service and the European Court of Auditors; notes furthermore that in 2022, a number of improvements were made to the internal control framework, such as an improved Control Strategy, including new indicators, an improved Information Asset Catalogue and the development of a new internal communications policy;

Other comments

14. Welcomes that the Centre aims to be EMAS registered in 2023 and is planning a project for CO2 offsetting (to commence in Q1 2024) that will include measures on calculating the CO2 impact and how to minimize it; notes that Specific targets will be part of the EMAS implementation, commencing in 2024;

15. Commends that during 2022, the Centre moved more towards using electronic tools in the procurement process; notes that the Centre now uses the Commission Public Procurement Management Tool (PPMT) for the registration and publication of all procurement procedures, including Ex Ante publications; notes that the PPMT system is linked to eTendering where the publication as well as Q&A during the publication is handled; notes furthermore that the Centre also uses an internal eWorkflow for purchases under Framework Contracts and for the review before launch;

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16. 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.