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DRAFT REPORT (2023/2156(DEC))

On discharge in respect of the implementation of the budget of the European Medicines Agency for the financial year 2022

CONT-PR-753524

Committee on Budgetary Control · Rapporteur: Petri Sarvamaa

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This draft report proposes that Parliament grant discharge to the Executive Director of the European Medicines Agency for the 2022 budget and approve the closure of the Agency's 2022 accounts. It sets out observations on the Agency's budget and financial management, performance, efficiency, staff policy, conflicts of interest, internal control and other matters. It notes the Agency's 2022 final budget of EUR 421 815 000, a budget implementation rate of 96,80 % and a payment execution rate of 71,48 %. It raises concerns about the London office lease, with estimated outstanding costs of EUR 366 million until 2039, and about asset inventory discrepancies. It calls on the Agency to comply with financial rules, address outstanding audit recommendations and report back to the discharge authority.

Committee position. The rapporteur proposes that Parliament grant discharge to the Executive Director of the European Medicines Agency for the 2022 budget and approve the closure of the Agency's 2022 accounts, while setting out observations in the accompanying resolution.

Key points

  1. Parliament would grant the Executive Director of the European Medicines Agency discharge for the 2022 budget and approve the closure of the Agency's 2022 accounts.
  2. The Agency's 2022 final budget was EUR 421 815 000, up 11,23 % from 2021, with about 88 % of revenue from fees and 12 % from the Union budget and miscellaneous income.
  3. The Court of Auditors found the Agency's annual accounts reliable and the underlying transactions legal and regular, and reported no procurement issues requiring corrective action.
  4. Budget implementation was 96,80 % for commitments and 71,48 % for payments; for one audited payment of EUR 2 million the Agency committed the budget after the legal commitment, against Article 73(2) of its Financial Regulation.
  5. The lease on the Agency's former London premises runs to 2039, with estimated outstanding rent, service charges and insurance of EUR 366 million at 31 December 2022; the Agency sublet the premises but remains liable if the subtenant fails.
  6. The Agency reported on 41 performance indicators with a 92,60 % implementation rate, delivered three major pieces of legislation and progressed international regulatory harmonisation.
  7. The Agency's mandate was extended on 1 March 2022 by Regulation (EU) 2022/123, requiring new bodies such as the Medicines Shortages Steering Group and the Emergency Task Force, and management of medical device expert panels.
  8. The Agency approved two new vaccines and two COVID-19 treatments, supported monkeypox vaccination, established DARWIN EU and pursued digitalisation and efficiency projects.
  9. The establishment plan was 99,39 % implemented with 658 of 662 temporary agents appointed; 192 contract agents, 25 seconded national experts and 114 interims also worked for the Agency.
  10. The Agency revised its conflict-of-interest policies and breach-of-trust procedure, initiated two breach-of-trust cases and processed 22 post-employment applications.
  11. The Court found the Agency had not clearly identified some donated assets and that inventory counts showed discrepancies, against Article 87 of the Financial Regulation; the Agency will update its asset management guidance.
  12. The Agency's internal audit issued 6 critical and 19 very important recommendations in 2022; Parliament calls on the Agency to address the 14 major recommendations awaiting action and report back.

Who is affected

  • The European Medicines Agency and its Executive Director, who would receive discharge and must act on the observations.
  • The Agency's staff and management, affected by staff policy, gender balance and conflict-of-interest rules.
  • The Agency's landlord and subtenant for the former London premises, given the lease liabilities until 2039.
  • The Council, the Commission and the Court of Auditors, which would receive the decision and resolution.

Figures and deadlines

  • EUR 421 815 000 — the Agency's final budget for 2022.
  • 11,23 % — increase in the 2022 budget compared to 2021.
  • 96,80 % — budget implementation rate for current year commitment appropriations.
  • 71,48 % — current year payment appropriations execution rate.
  • EUR 2 million — one audited payment for which the budgetary commitment followed the legal commitment.
  • EUR 366 million — estimated outstanding rent, service charges and landlord insurance up to the end of the London lease term.
  • EUR 15 million — Dutch government incentive scheme for fitting out the Amsterdam building.
  • EUR 534 331 to EUR 15 000 — decrease in inventory discrepancies found in four counts since relocation.

Legal basis: Article 319 of the Treaty on the Functioning of the European Union.