Sittings · Document
On discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies
Committee on Budgetary Control · Rapporteur: Isabel García Muñoz
PR_DEC_Com
1. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s 2022 Annual Management and Performance Report for the EU Budget (COM(2023)401),
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– having regard to the Court of Auditors’ annual report on the implementation of the budget for the financial year 2022, together with the institutions’ replies, and to the Court of Auditors’ special reports,
– 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 Commission in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Commission discharge in respect of the implementation of the general budget of the European Union for the financial year 2022 / Postpones its decision on granting the Commission discharge in respect of the implementation of the general budget of the European Union for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, and the resolution forming an integral part of it, to the Council, the Commission and the Court of Auditors, and to the national parliaments and the national and regional audit institutions of the Member States, and to arrange for their publication in the Official Journal of the European Union (L series).
2. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the budget of the European Climate, Infrastructure and Environment Executive Agency for the financial year 2022
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the final annual accounts of the European Climate, Infrastructure and Environment Executive Agency for the financial year 2022,
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– 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 executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(3) thereof,
– having regard to Commission Regulation (EC) No 1653/2004 of 21 September 2004 on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular the first and second paragraphs of Article 66 thereof,
– having regard to Commission Implementing Decision (EU) 2021/173 of 12 February 2021 establishing the European Climate, Infrastructure and Environment Executive Agency, the European Health and Digital Executive Agency, the European Research Executive Agency, the European Innovation Council and SMEs Executive Agency, the European Research Council Executive Agency, and the European Education and Culture Executive Agency and repealing Implementing Decisions 2013/801/EU, 2013/771/EU, 2013/778/EU, 2013/779/EU, 2013/776/EU and 2013/770/EU,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Director of the European Climate, Infrastructure and Environment Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022 / Postpones its decision on granting the Director of the European Climate, Infrastructure and Environment Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, the decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and the resolution forming an integral part of those decisions, to the Director of the European Climate, Infrastructure and Environment Executive Agency, 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).
3. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the budget of the European Education and Culture Executive Agency for the financial year 2022
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the final annual accounts of the European Education and Culture Executive Agency for the financial year 2022,
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– 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 executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(3) thereof,
– having regard to Commission Regulation (EC) No 1653/2004 of 21 September 2004 on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular the first and second paragraphs of Article 66 thereof,
– having regard to Commission Implementing Decision (EU) 2021/173 of 12 February 2021 establishing the European Climate, Infrastructure and Environment Executive Agency, the European Health and Digital Executive Agency, the European Research Executive Agency, the European Innovation Council and SMEs Executive Agency, the European Research Council Executive Agency, and the European Education and Culture Executive Agency and repealing Implementing Decisions 2013/801/EU, 2013/771/EU, 2013/778/EU, 2013/779/EU, 2013/776/EU and 2013/770/EU,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Acting Director of the European Education and Culture Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022 / Postpones its decision on granting the Acting Director of the European Education and Culture Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, the decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and the resolution forming an integral part of those decisions, to the Acting Director of the European Education and Culture Executive Agency, 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).
4. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the budget of the European Innovation Council and SMEs Executive Agency for the financial year 2022
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the final annual accounts of the European Innovation Council and SMEs Executive Agency for the financial year 2022,
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– 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 executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(3) thereof,
– having regard to Commission Regulation (EC) No 1653/2004 of 21 September 2004 on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular the first and second paragraphs of Article 66 thereof,
– having regard to Commission Implementing Decision (EU) 2021/173 of 12 February 2021 establishing the European Climate, Infrastructure and Environment Executive Agency, the European Health and Digital Executive Agency, the European Research Executive Agency, the European Innovation Council and SMEs Executive Agency, the European Research Council Executive Agency, and the European Education and Culture Executive Agency and repealing Implementing Decisions 2013/801/EU, 2013/771/EU, 2013/778/EU, 2013/779/EU, 2013/776/EU and 2013/770/EU,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Director of the European Innovation Council and SMEs Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022 / Postpones its decision on granting the Director of the European Innovation Council and SMEs Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, the decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and the resolution forming an integral part of those decisions, to the Director of the European Innovation Council and SMEs Executive Agency, 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).
5. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the budget of the European Research Council Executive Agency for the financial year 2022
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the final annual accounts of the European Research Council Executive Agency for the financial year 2022,
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– 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 executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(3) thereof,
– having regard to Commission Regulation (EC) No 1653/2004 of 21 September 2004 on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular the first and second paragraphs of Article 66 thereof,
– having regard to Commission Implementing Decision (EU) 2021/173 of 12 February 2021 establishing the European Climate, Infrastructure and Environment Executive Agency, the European Health and Digital Executive Agency, the European Research Executive Agency, the European Innovation Council and SMEs Executive Agency, the European Research Council Executive Agency, and the European Education and Culture Executive Agency and repealing Implementing Decisions 2013/801/EU, 2013/771/EU, 2013/778/EU, 2013/779/EU, 2013/776/EU and 2013/770/EU,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Director of the European Research Council Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022 / Postpones its decision on granting the Director of the European Research Council Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, the decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and the resolution forming an integral part of those decisions, to the Director of the European Research Council Executive Agency, 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).
6. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the budget of the European Health and Digital Executive Agency for the financial year 2022
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the final annual accounts of the European Health and Digital Executive Agency for the financial year 2022,
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– 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 executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(3) thereof,
– having regard to Commission Regulation (EC) No 1653/2004 of 21 September 2004 on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular the first and second paragraphs of Article 66 thereof,
– having regard to Commission Implementing Decision (EU) 2021/173 of 12 February 2021 establishing the European Climate, Infrastructure and Environment Executive Agency, the European Health and Digital Executive Agency, the European Research Executive Agency, the European Innovation Council and SMEs Executive Agency, the European Research Council Executive Agency, and the European Education and Culture Executive Agency and repealing Implementing Decisions 2013/801/EU, 2013/771/EU, 2013/778/EU, 2013/779/EU, 2013/776/EU and 2013/770/EU,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Director of the European Health and Digital Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022 / Postpones its decision on granting the Director of the European Health and Digital Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, the decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and the resolution forming an integral part of those decisions, to the Director of the European Health and Digital Executive Agency, 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).
7. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on discharge in respect of the implementation of the budget of the European Research Executive Agency for the financial year 2022
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the final annual accounts of the European Research Executive Agency for the financial year 2022,
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– 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 executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(3) thereof,
– having regard to Commission Regulation (EC) No 1653/2004 of 21 September 2004 on a standard financial regulation for the executive agencies pursuant to Council Regulation (EC) No 58/2003 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular the first and second paragraphs of Article 66 thereof,
– having regard to Commission Implementing Decision (EU) 2021/173 of 12 February 2021 establishing the European Climate, Infrastructure and Environment Executive Agency, the European Health and Digital Executive Agency, the European Research Executive Agency, the European Innovation Council and SMEs Executive Agency, the European Research Council Executive Agency, and the European Education and Culture Executive Agency and repealing Implementing Decisions 2013/801/EU, 2013/771/EU, 2013/778/EU, 2013/779/EU, 2013/776/EU and 2013/770/EU,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Grants the Director of the European Research Executive Agency discharge in relation to the implementation of the Agency’s budget for the financial year 2022 / Postpones its decision on granting the Director of the European Research Executive Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision, the decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and the resolution forming an integral part of those decisions, to the Director of the European Research Executive Agency, 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).
8. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION
on the closure of the accounts of the general budget of the European Union for the financial year 2022, Section III – Commission
(2023/2129(DEC))
– having regard to the general budget of the European Union for the financial year 2022,
– having regard to the consolidated annual accounts of the European Union for the financial year 2022 (COM(2023)0391 – C90248/2023),
– having regard to the Commission’s report on the follow-up to the discharge for the 2021 financial year (COM(2023)384), and to the detailed replies to the specific requests made by the European Parliament,
– having regard to the Commission’s 2022 Annual Management and Performance Report for the EU Budget (COM(2023)401),
– having regard to the Commission’s annual report to the discharge authority on internal audits carried out in 2022 (COM(2023)323), and to the accompanying Commission staff working document (SWD(2023)214),
– having regard to the Court of Auditors’ annual report on the implementation of the budget for the financial year 2022, together with the institutions’ replies, and to the Court of Auditors’ special reports,
– 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 Commission in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to the Council’s recommendation of ... February 2024 on discharge to be given to the executive agencies in respect of the implementation of the budget for the financial year 2022 (00000/2024 – C90000/2024),
– having regard to Articles 317, 318 and 319 of the Treaty on the Functioning of the European Union,
– having regard to Article 106a of the Treaty establishing the European Atomic Energy Community,
– 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 Articles 69, 260, 261 and 262 thereof,
– having regard to Council Regulation (EC) No 58/2003 of 19 December 2002 laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes, and in particular Article 14(2) and (3) thereof,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
1. Approves the closure of the accounts of the general budget of the European Union for the financial year 2022 / Postpones the closure of the accounts of the general budget of the European Union for the financial year 2022;
2. Sets out its observations in the resolution forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies;
3. Instructs its President to forward this decision to the Council, the Commission, the Court of Justice of the European Union, the Court of Auditors and the European Investment Bank, and to the national parliaments and the national and regional audit institutions of the Member States, and to arrange for its publication in the Official Journal of the European Union (L series).
9. MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION
with observations forming an integral part of the decisions on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission and executive agencies
(2023/2129(DEC))
– having regard to its decision on discharge in respect of the implementation of the general budget of the European Union for the financial year 2022, Section III – Commission,
– having regard to its decisions on discharge in respect of the implementation of the budgets of the executive agencies for the financial year 2022,
– having regard to Rule 99 of and Annex V to its Rules of Procedure,
– having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Women's Rights and Gender Equality,
– having regard to the letter from the Committee on Agriculture and Rural Development,
– having regard to the report of the Committee on Budgetary Control (A90000/2024),
– having regard to the inter-institutional agreement of 16 December 2020 on cooperation on budgetary matters and sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources;
Political priorities
1. Recalls its strong commitment to the fundamental principles and values enshrined in the Treaty on European Union (TEU) and the Treaty on the Functioning of the European Union (TFEU), including sound financial management as set out in Article 317 of the TFEU and the combating of fraud and protecting the financial interests of the Union as set out in Article 325 of the TFEU;
2. Highlights the importance of the Union budget for achieving the Union’s political priorities, as well as its role in assisting Member States in unforeseen circumstances such as the COVID-19 pandemic, international conflicts or crisis and their consequences; notes in this regard the continuing relevance of investments and support from the Union budget for reducing disparities between Member States and regions, for promoting economic growth and employment, for combating poverty and social exclusion, and thus for improving the daily life of Union citizens;
3. Stresses that the sound and timely implementation of the budget contributes to addressing more efficiently and effectively the needs and challenges in different policy areas; warns that the implementation of the budget under time pressure may lead to an increase in errors and irregularities;
4. Stresses the Recovery and Resilience Facility (RRF)'s contribution to support Member States in recovering from the economic and social consequences of the COVID-19 pandemic and creating a resilient Union that can shoulder the challenges of the future; notes the contribution of the RRF and RePowerEU in addressing the energy-related challenges caused by the Russia’s war of agression against Ukraine; calls on the Commission and the Member States to implement the associated actions swiftly in accordance with the agreed milestones and targets;
5. Highlights the crucial role the Union budget played in 2022 in addressing the fall-out of Russia’s war of aggression against Ukraine to secure food supply chains, address energy-related challenges, support Member States in welcoming refugees, and provide assistance to Ukraine in caring for its citizens; notes that this has put pressure on the budget and that all available flexibility measures have been used; notes in that regard the proposals made by the Commission in the Multi-annual Financial Framework (MFF) review to re-orient funds and to raise fresh funds, and calls on the Council to swiftly move forward with the adoption of the proposals;
6. Recalls the importance of carrying out an ex-post evaluation of financial programmes created to respond to a crisis concerning their effectiveness, efficiency, relevance, coherence and Union added value;
7. Emphasises the role of the European anti-fraud office (OLAF), the European Public Prosecutor's Office (EPPO), the European Union Agency for Criminal Justice Cooperation (Eurojust) and the European Union Agency for Law Enforcement Cooperation (Europol) in the fight against corruption; calls for the capacities of the EPPO and OLAF, as well as cooperation between them, to be strengthened further; calls for common anti-corruption rules applicable to all staff of Union bodies;
8. Welcomes the measures undertaken by the Commission in 2022 and 2023 under the Rule of Law conditionality mechanism for the protection of the Union budget and asks the Commission to continue to be vigilant and proactive in the current and future cases when the lack of respect for Union values and the Rule of Law affect or threaten to affect the Union’s financial interests;
9. Welcomes the agreement reached in the negotiations on the revised Union financial rules in December 2023; welcomes, in particular, the enhancements related to tracking Union funds through digital tools that will bolster the protection of the Union Financial Interests, the reference to the Rule of Law conditionality mechanism and Union values, the introduction of the principle of social conditionality, as well as the opportunity to streamline support for small and medium-sized enterprises and individual applicants by the introduction of very low-value grants;
10. Reminds the Commission that all legislative proposals that have a significant economic, social and environmental impact have to be accompanied by solid and thorough impact assessments, including their impact on gender-related issues, which will ensure that gender-mainstreaming in the Union Budget is successful;
11. Is concerned that the late adoption of several sectoral regulations governing different Union policies, such as the Cohesion policy, resulted in a significant delay in the implementation of the 2021-2027 programming period; urges the Commission and the Member States once moreto take all the necessary measures to continue to speed up the implementation of the policies on the ground, while keeping a high focus on compliance with the rules, achievement of results and protection of the financial interests of the Union; highlights in this context the importance of avoiding decommitments which in turn would decrease the impact of the Union budget;
CHAPTER I - Multi-annual Financial Framework (MFF)
The European Court of Auditors' statement of assurance and budgetary and financial management
Reliability of the accounts
12. Welcomes that the Court finds in its Annual report on the implementation of the budget for the financial year 2022, , that the consolidated accounts of the European Union for the year 2022 are reliable; notes with satisfaction that the Court has given a clean opinion on the reliability of the accounts every year since 2007;
13. Notes that at 31 December 2022, total liabilities amounted to EUR 577,2 billion, compared with EUR 445,9 billion of total assets; notes that the difference of EUR 131,3 billion represented the (negative) net assets, comprising reserves and the portion of expenses already incurred by the Union up to 31 December 2022 that must be funded by future budgets;
14. Notes that at the end of 2022, the estimated value of incurred but not yet claimed eligible expenses due to beneficiaries, recorded as accrued expenses, was EUR 148,7 billion (2021: 129,9 billion), of which EUR 22,6 billion is related to accrued RRF expenditure;
15. Notes that after the end of the transition period following the UK’s withdrawal process, the Commission estimated that, at the balance sheet date, the Union accounts showed a net receivable due from the UK of EUR 23,9 billion (2021: 41,8 billion), of which it is estimated that EUR 9,1 billion will be paid in the 12 months following the reporting date;
16. Notes that the Court has assessed the impact of Russia's unprovoked and unjustified war of aggression against Ukraine on the Union accounts; welcomes the Court’s conclusion that this impact has been appropriately accounted for and disclosed in the consolidated annual accounts;
17. Welcomes the Court’s conclusion that the assets, liabilities, revenue and expenses, including those related to the European Recovery Instrument 'NextGenerationEU' (‘NGEU’), are presented fairly in the consolidated annual accounts;
Legality and regularity of Union revenue and expenditure
18. Welcomes the Court’s conclusion that the revenue is free from material error and that the systems for managing the revenue examined by the Court were generally effective; regrets the adverse opinion on the legality and regularity of the Union budget expenditure issued by the Court for the fourth year in a row;
19. Notes that the Court estimates the level of error for the 2022 expenditure to be 4,2 % (3 % in 2021), which is above the materiality threshold; notes the Commission’s confidence that the risk at payment is estimated at 1.9 % for 2022 (similar to 2020, 2021 and 2022), is representative of the level of error at the time of payment; notes that the Commission’s estimation of the risk at closure, after ex-post controls and corrections have been applied, is 0.9 %; notes the divergence between the Court’s overall error rate and the Commission’s risk at payment, which is observed for the overall Union budget expenditure in 2022, although not in all expenditure areas;
20. Underlines that the general estimate of the level of error in the Union budget, as presented in the Court’s Statement of Assurance, is an estimate of the money that should not have been paid out because it was not used in accordance with the applicable rules and regulations, and not a measure of fraud or of inefficiency or waste;
21. Recalls that the audit approach and methodology of the Court are based on international audit standards that require the testing of a random, representative sample of transactions that result in an estimate of the error rate; recalls that the Court differentiates between low-risk expenditure, i.e. entitlement-based payments under simplified rules, and high-risk expenditure, i.e. reimbursement-based payments subject to complex rules; notes that for the 2022 expenditure, the Court has selected 66 % of its audit population from the high-risk expenditure (63,2 % in 2021), amounting to EUR 110,1 billion, and 34 % from the low-risk expenditure, amounting to EUR 56,7 billion; notes that the Court’s estimated error rate for 2022 (4,2 %) is mainly driven by ‘Cohesion, resilience and values’ (2,5 % of the overall error rate), ‘Natural resources and environment (0,8 %), ‘Neighbourhood and the world’ (0,4 %), and ‘Single market, innovation and digital’ (0,3 %), all of them considered high-risk expenditure areas by the Court; notes that the Commission’s risk at payment for 2022 is 1,9 %;
22. Recalls that the Court’s audit efforts are focused only on the year under review and cannot take account of the lifecycle of Union programmes and funds, as well as corrections and recoveries after the end of the year under review;
23. Recalls that Union spending programmes are multiannual by design and their related control systems and management cycles also cover multiple years; recalls that the Commission’s estimates of the risk at closure have a multiannual perspective that takes account of corrections and recoveries over several years; notes that the Commission’s approach is based on hundreds of thousands of tests as defined in control strategies, performed during substantive control and audit work which is primarily aimed at checking compliance with Union rules and regulations, applicable to given programmes, to ultimately establish whether funds need to be recovered from beneficiaries; notes that the range of the risk at payment, determined as part of this approach, resembles most of the Court’s estimated error rate and is considered by the Commission as the best estimate to express the exposure to the Union budget;
24. Considers that both approaches serve different purposes and have their benefits, disadvantages, strengths, and weaknesses, and should be used to complement each other while understanding the differences and particularities, such as the different concepts of error and the risk categorisation used by each institution; commends the Commission’s approach for its sheer size and the resulting granularity in identifying where additional efforts are most beneficial and where improvements are needed; considers the Court’s error rate to be an important indicator of compliance with legality and regularity of the implementation of the Union budget; welcomes in this regard the Court’s findings, observations and recommendations as a very useful contribution to the further improvement of the budget management and implementation under different management modes and by all relevant stakeholders;
25. Notes that, on several issues, the Court’s and Commission’s findings are aligned, most notably concerning the main sources of irregularities in ‘Cohesion’, and the higher risks for market measures and rural development in ‘Natural resources and environment’; notes that specifically in ‘Cohesion’ some cases of eligibility errors identified and quantified by the Court do not allow the Commission to qualify the error as an irregularity to be corrected in line with the definition laid down in Article 2(36) of Regulation (EU) No 1060/2021 (‘the Common Provisions Regulation’ or CPR) and thus, the Commission cannot pursue financial correction procedures, and such errors would not enter into the Commission’s estimate of risk at payment;
26. Welcomes that the Commission improved its reporting on preventive and corrective measures to protect the Union budget from illegal and irregular expenditure; notes that the Commission clarified that the total amount reported in the Annual Management and Performance Report (AMPR) as financial corrections and recoveries (EUR 4,95 billion) includes preventive and corrective measures taken by the Commission and Member States; notes that the Commission reported EUR 734 million in net corrections and EUR 195 million in recovered undue payments from final recipients;
27. Notes that the Court, in the exercise of its mandate, does not investigate fraud but does take account of the risk of fraud; notes that the Court forwards to the EPPO suspicions of criminal offences falling in its competences and to OLAF suspicions of fraud, corruption or other illegal activity affecting the Union’s financial interests identified while performing its audits; notes that, in 2022, the Court reported 14 cases of suspected fraud to OLAF, and in parallel reported 6 of these cases to the EPPO, resulting so far in 2 OLAF investigations and 3 EPPO investigations;
Budgetary and financial management
28. Welcomes that in 2022, 98,5% of the available commitment appropriations were used (EUR 179,4 billion out of EUR 182,2 billion); notes that the available appropriations were higher than the MFF ceiling of EUR 179,9 billion due to the use of special instruments, justified by unforeseen events, using all flexibility available under the MFF; notes that 98,1% of payment appropriations were used (EUR 167,3 billion of EUR 170,6 billion available); commends the Commission and the budgetary authority for its decisive and flexible budgetary response to the challenges faced in 2022;
29. Notes that the total outstanding commitments reached an all-time high of EUR 450 billion in 2022, caused by both increased commitments related to NGEU (with all National Recovery and Resilience Plans adopted in 2022) and the start of the implementation of the 2021-2027 programming period; notes that the Commission expects this amount to further increase in 2023, and foresees a decrease from 2024 to 2027 when committed amounts for both NGEU and the 2021-2027 programming period should be paid out;
30. Notes the Court’s warning that for the 2021-2027 shared management funds under the CPR, the decommitment risk has risen significantly due to a series of factors, namely the slow start because of the late adoption of sector-specific regulations, the prioritisation of the remaining European Structural and Investment (ESI) Funds and NGEU funding, the fact that those funds have a shorter payment timeframe by one year compared to the previous MFF period and the overlap with NGEU payments until 2026; stresses, therefore, the Court’s 2021 recommendation for the Commission to ensure that there is additional advisory support to national authorities so all bodies responsible for managing and controlling these funds can ensure sound financial management;
31. Notes that Union debt increased from EUR 236,7 billion in 2021 to EUR 344,3 billion in 2022; notes that of the entire debt, only the share of NGEU non-repayable support (EUR 185,6 billion, 53,9 %) creates interest rate risk for the Union budget; notes that, due to growing market interest rates, the cost of new NGEU funding rose from 0,14 % in the second half of 2021 to 1,24% in the first half of 2022, and a further increase to2.60% in the second half of 2022, resulting in EUR 0,5 billion of interest payments for NGEU in 2022, and a considerable increase was projected for 2023; recalls that the repayments of NGEU borrowing should start in 2028 and must be completed by 2058, which will require sufficient financial resources;
32. Notes that since December 2022, the Commission has a new debt management strategy in place, namely a “diversified funding strategy” which consists of the techniques and funding instruments used by sovereign issuers; recalls the Court’s Special Report 16/2023 on NGEU debt management that concluded that the Commission quickly established its debt management system, allowing for a timely start of borrowing operations, that met all regulatory requirements concerning debt portfolio and risk management;
33. Notes that the total exposure of the Union budget because of guarantees and contingent liabilities for loans rose to EUR 248,3 billion, of which EUR 57,8 billion for an additional safeguard has been created through the Common Provisioning Fund (‘CPF’); notes that higher interest rates also require a higher provisioning rate in the future;
34. Notes that the exposure of the Union budget to Ukraine increased in 2022 to EUR 15,6 billion, with related provisions notes that for the MFA+ support to Ukraine with a value of EUR 18,0 billion, agreed at the end of 2022 and disbursed throughout 2023, no provisions were required in the CPF; draws attention that possible losses related to MFA+ will have to be covered by future Union budgets or by the budgetary ‘headroom’ between the MFF ceiling and the own resources ceiling;
Recommendations
35. Strongly supports the recommendations of the Court in its Annual Report on the implementation of the budget for the financial year 2022 (‘Annual Report for the 2022 financial year) as well as in related special reports; calls on the Commission to implement them without delay and to keep the discharge authority informed on the progress of the implementation;
36. Calls on the Commission, in particular, to:
(i) continue its discussions with the Court in order to increase understanding and convergence of the way both deal with the irregularities;
(ii.) continue to simplify rules and procedures without compromising the quality of the controls;
(iii) step up efforts to improve transparency in the use of funds, including as regards information on final beneficiaries;
(iv) continue to support the administrative capacity of Member States’ authorities;
(v) report as part of its disclosure on contingent liabilities and what the annual exposure of the Union budget is, arising from budgetary guarantees and from financial assistance to third countries;
(vi) continue monitoring the possible risk of corruption and fraud across all funds, using feedback from investigations by the EPPO and OLAF;
Performance of the Union budget
37. Notes the re-integration of the Court’s work on performance of the Union budget into its Annual Report; regrets to note that the content of the related chapter is of considerably less depth than the previous year’s annual report on performance; regrets in particular that the link to the Sustainable Development Goals has become much less evident in the current set-up; notes that the Court’s work on performance as included in its 2022 Annual Report lies primarily in summarising the findings from Special Reports;
38. Notes that the Court has followed up on the implementation of 213 of its recommendations made in 2019, out of which 179 were addressed to the Commission; notes that four of the 179 recommendations were not yet due for implementation by the time the follow-up review was carried out and that, of the remaining 175 recommendations, the Commission has fully implemented 101 (58 %), 26 in most respects (15 %), 24 in some respects (13 %), and has not implemented 17 (10 %) of them at all, the Court being unable to conclude in 7 cases (4 %) where the auditee had not accepted them or it was too early to assess the implementation;
39. Considers the overview of special reports, which spans the largest part of chapter three of the Court’s Annual report, gives a good overview of reports presented by the Court that relate to 2022 strategic areas but is limited and incomplete in terms of the content of those reports and the replies provided by the auditees; considers that an analysis of the performance of the Union budget requires more than a follow-up of the auditor recommendations, despite their undeniable value in terms of budgetary control; notes the issue of timing concerning to the publication of the AMPR;
40. Notes that the Commission publishes the ‘Programme Performance Statements’, which is an overview of the performance information of the programmes of the 2021-2027 Union budget, and the ‘Horizontal priorities’, a section on how the Commission tracks and reports on what is spent on green budgeting, gender equality mainstreaming, digital tracking and the sustainable development goals;
41. Notes the Court’s review 06/2023 on the Commission’s 2022 AMPR for the Union budget and its conclusion that Volume I of the 2022 AMPR followed the Commission’s corporate management board strategic guidance when it presented the facts and achievements concerning budgetary management for 2022, and notes that there was scope to improve the quality of performance data; notes the Commission’s replies to written questions on an IAS audit into data quality and the reassurance given that the identified issue is being dealt with;
42. Welcomes that the Commission has included information in its AMPR on green budgeting, digital tracking and the gender-equality dimension in the Union budget; notes that the number of programmes for which the contribution to gender equality is unknown decreased to 72 %; supports the Commission’s position that this figure needs to be reduced further;
Revenue
43. Notes that the revenue of the Union budget comprises own resources, external assigned revenue and other revenue; notes that in 2022 the Gross National Income (GNI)-based own resource accounted for EUR 103,9 billion (42,3 %), external assigned revenue accounted for EUR 62,2 billion (25,4 %), traditional own resources (TOR) accounted for EUR 25,9 billion (10,6 %), contributions and refunds connected with the Union agreements and programmes accounted for EUR 20,9 billion (8,5 %), value added tax (VAT)-based own resource accounted for EUR 19,7 billion (8,0%), non-recycled plastic packaging waste-based own resources accounted for EUR 6,3 billion (2,6 %), and other revenue accounted for EUR 6,4 billion (2,6 %);
44. Notes the Court’s Special Report 25/2022 on verification of Gross National Income (GNI) for financing the Union budget; recalls that the GNI data reported by Member States are the basis for calculating the Member States’ contributions and considers it therefore essential for the Commission to improve the efficiency in the verification cycle following the recommendations of the Court; welcomes the Court’s conclusions that the verification process of the GNI data carried out by the Statistical Office of the European Union (Eurostat) was effective; welcomes that Eurostat has prepared an action plan to address the recommendations with a view to implementing them after the 2020-2024 cycle;
45. Welcomes the Court’s conclusion in its Annual Report for 2022 that the level of error in revenue transactions was not material and that the systems for managing the revenue are generally effective; is worried by the weaknesses identified by the Court in certain Member States’ accounting and management of TOR, and in the Union action taken to reduce the customs gap and ensure that TOR is complete; welcomes the actions undertaken by the Commission and Member States in that regard;
46. Notes from the Annual Report on the Protection of the Union financial interests (PIF Report) that in 2022, the number of fraudulent irregularities relating to TOR (454) fell by 6,8 % and non-fraudulent irregularities (4 207) rose by 9,4 % compared to the 5-year average for 2018-2022; notes that most fraudulent cases reported in 2022 relate to incorrect value and incorrect classification or misdescription of goods, while smuggling remains one of the primary modus operandi; notes that most fraudulent cases are detected by inspections by national anti-fraud services together with customs release controls; notes that the recovery rate is currently 48 %, although it can be expected that it will go up in the future due to the length of the process;
47. Notes the summary of waivers of recoveries and established amounts receivable in Annex 9 of the 2022 AMPR; notes that the total general value of waived recoveries was EUR 40,4 million, an increase of 28 % in comparison with 2021 (EUR 31,4 million) and considers this is a loss of revenue for the Union budget;
48. Welcomes the developments that have resulted in lifting both the quantified and unquantified reservation in the area of textiles and shoes imported from China; notes with satisfaction that the United Kingdom has now paid the total amount due (final payment of EUR 1,57 billion in January 2023) including interest (EUR 1,4 billion in February 2023); notes that 26 Member States made significant provisional payments for their expected amounts due to the Union budget and that in line with the CJEU judgment in the case C-213/19 the Commission will apply the same quantification method for these Member States as for the United Kingdom, which will result in recalculated amounts, allowing the Commission to finalise the exercise completely;
Recommendations
49. Calls on the Commission to:
(i) take over the suggestions of the European Parliament in its resolutions on own resources in order to ensure resources to repay the investments made under NGEU;
(ii) make use of all means available to stimulate cooperation between anti-fraud services and customs agencies to detect, prevent and correct fraud affecting Union revenue;
(iii) inform the discharge authority about the results of the review of the collected own resources;
(iv) examine carefully the differences in recovery rates by Member States in order to identify possible specific weaknesses;
Single market, Innovation and Digital
50. Notes that the budget for the programmes under MFF heading 1 ‘Single Market, Innovation and Digital’ was EUR 25,2 billion (12,9 % of the Union budget) distributed as follows: EUR 15,8 billion (62.8 %) for Research, EUR 3,5 billion (14.0 %) for Transport, Energy and Digital, EUR 2,7 billion (10.6 %) for InvestEU Programme, EUR 2 billion (8.0 %) for Space, and EUR 1,2 billion (4.6%) for other areas; notes that as of 31 December 2022 the final adopted budget commitments appropriations were EUR 21 845,08 million and 99,99 % of them were implemented (EUR 21 842.58 million); notes further that the final adopted budget payment appropriations amounted to EUR 20 605.64 million and 99,35 % of them were implemented (EUR 20 4710.31 million);
Innovation and research
51. Highlights the importance of Union R&I funding programmes for the scientific, societal, and technological/economic development of the Union, to reduce inequalities, for the recovery, the green and digital transitions and the need to decrease Union energy dependency on Russia; recalls that Horizon Europe is the most significant research and innovation programme in Europe, with a total budget of EUR 95.5 billion, including EUR 5.4 billion from the NGEU instrument; notes that the RRF has allocated around EUR 48 billion in investments to R&I;
52. Notes the late adoption of the Horizon Europe legal bases in 2021 and welcomes that the Commission managed to reach close to 100 % budget implementation in 2021 and 2022; notes that the number of grant agreements signed by the end of 2022 was 5 509; notes that, despite the fact the average success rate of proposals has increased from 11,9 % in Horizon 2020 to 15,9 % in Horizon Europe, 7 out of 10 high-quality proposals still cannot be funded and an extra EUR 34,3 billion would have been needed to fund those proposals;
53. Notes that the Court has examined 127 transactions covering the full range of spending under this MFF heading, notably the Horizon2020 programme, the Connecting Europe Facility (CEF), financial instruments and the space programme, including the regularity information in the annual activity reports of the Directorate-General for Research and Innovation (DG RTD) and Directorate-General for Defence Industry and Space (DG DEFIS);
54. Notes that the Court estimates that the level of error in spending on ‘Single Market, Innovation and Digital’ in 2022 was material at 2,7 % ; notes with satisfaction that this is a considerable decrease compared to 4,4 % in 2021; takes note of the Court’s observation that the research and innovation expenditure is most affected by error, particularly in the area of personnel costs; notes that the Commission calculated an error rate of 1,5 % for this heading;
55. Notes that quantifiable errors relating to ineligible costs represent 98 % of the Court’s estimated level of error in 2022; notes with concern, in particular, that the rules for declaring personnel costs under Horizon 2020 remain complex and that their calculation remains a significant source of error (67 % of the estimated error level in 2022); notes that the Commission has developed and promotes the use of the ‘Personnel Costs Wizard’ to help beneficiaries to declare their personnel costs correctly;
56. Notes that Horizon 2020 continues to represent the large majority of projects in the Court’s sample, with just one Horizon Europe project in the 2022 sample; stresses that, according to the Court, certain simplifications in Horizon 2020, in particular the introduction of a flat rate for indirect costs, have reduced the administrative burden on beneficiaries and have the potential to reduce the risk of error;
57. Notes the remarks made by the Director-General for Research and Innovation in his discharge hearing that the Commission intends to increase the disbursement of Horizon Europe funds through lump sums from 2 % in 2022 to 50 % in 2027; notes, in that context, the Court’s specific review of the Commission’s procedures and guidance on lump-sum funded grants in research; notes the Commission’s statement that the level of scrutiny in terms of economy, efficiency and effectiveness is higher in the evaluation of lump-sum proposals;
58. Stresses the crucial role of the private sector in addressing the innovation gap in the Union and improving Union competitiveness and growth; believes, in particular, that it is imperative to keep promoting and facilitating as much as possible the participation of small and medium-sized enterprises (SMEs) in Union R&I funding programmes; notes the Court’s conclusion that SMEs and newcomers are more prone to errors than other beneficiaries and welcomes the efforts made by the Commission to specifically support them, for example through information campaigns, contacts with the system of National Contact Points and the dedicated helpdesk of the Research Enquiry Service;
59. Notes that the R&I Family Fraud Risk Assessment was updated in 2022 as work preceding the 2023 update of the Common Anti-Fraud Strategy; notes the drafting and adoption in 2022 of the ‘Guidance on Horizon Europe ex-ante anti-fraud checks’, which is part of the Horizon Europe ex-ante control strategy; notes that the main forum of the R&I Family on anti-fraud matters is the commitee for Fraud and Irregularities in Research (FAIR Committee)), that met two times in 2022; notes that DG RTD also updated its Anti-fraud Strategy in 2022;
60. Recalls that fostering, attracting and retaining talent is one of the five flagships comprising the New European Innovation Agenda (NEIA), adopted on 5 July 2022; notes the statements of Commissioner Ivanova in her discharge hearing on the efforts made by the Commission to increase inclusivity in Horizon2020 and Horizon Europe; notes the Commissioner’s acknowledgement that further efforts are necessary to increase the participation of women and young people in Union R&I programmes; notes in that regard the efforts made by the Commission to implement the provisions on gender equality plans in Horizon Europe, and the joint RTD-EAC effort to attract female talent to STEM; welcomes that, in addition to other Union initiatives aiming to support and empower women in tech and innovation, in 2022 the Commission launched the second edition of Women TechEU call with an increased budget of EUR 10 million, which attracted a record number of interest with 467 applications from 35 Member States and Horizon Europe Associated Countries;
61. Welcomes the role of the ERC in supporting top researchers in Europe, which is underlined by numerous awards, including 14 Nobel Prizes, 6 Fields Medals and 11 Wolf Prizes; welcomes the 2 300 patent applications and 400 spin-off companies generated thanks to ERC projects;
62. Notes the disparities in R&I development within the Union and welcomes the different measures taken by the Commission to boost Member States’ R&I investments, especially less performing R&I countries, including around EUR 48 billion from the RRF, coupled with EUR 43 billion from the cohesion Policy and EUR 3 billion from the ‘Widening participation and spreading excellence’component of Horizon Europe; notes that despite the Commission’s efforts to increase funding allocated to researchers in widening countries several ‘catch-up countries’ are not yet showing progress;
63. Notes that, following Russia’s war of aggression against Ukraine, the Commission stopped the participation of Russian public entities in ongoing Horizon 2020 projects and future Horizon Europe projects; notes that the latest amendment of the ‘main’ Horizon Europe work programme 2021-2022, adopted on 10 May 2022, included actions to support researchers previously active in Ukraine; notes that the Commission provided financial support of in the form of a grant of EUR 1.5million to the National Research Foundation of Ukraine for the establishment of a Horizon Europe Office in Ukraine (Kyiv), which will promote funding opportunities and offer support in drafting proposals and finding partners in Europe;
Energy
64. Notes the complexity of the energy policy framework in the Union and stresses that ensuring better interconnectivity is at the core of the Union energy market; welcomes the adoption of the new trans-European energy infrastructure Regulation Regulation (EU) 2022/869 (‘TEN-E Regulation’ ); considers that the Union has, through TEN-E, CEF and the RRF/ RePowerEU Plan, made a robust legal framework available for investments in energy infrastructure, addressing the challenges of decarbonisation and decreasing dependency on imports of fossil fuel; notes the efforts made to coordinate the construction of high-priority electricity infrastructure across Member States, digitalise the Union energy system, and stimulate the grid investment with the right regularity environment, in particular through CEF Energy;
65. Notes that, in total, CEF Energy 1 and 2 (2014-2023) provided EUR 6,3 billion of support to energy projects (EUR 5,8 billion works, EUR 0.5 billion studies) to more than 117 Projects of Common Interest (PCIs) and by the end of 2022, 107 actions that received support from CEF-1 Energy were completed;
Recommendations
66. Calls on the Commission to:
(i) continue to apply simplified rules and procedures, digitalisation measures and simplified cost options (SCOs) while addressing, in particular, the risk of irregularities and fraud and the costs of controls;
(ii) continue to promote the use of the ‘Personnel Costs Wizard’ to beneficiaries, in particular newcomers and SMEs, to decrease the error level related to personnel costs;
(iii) continue its efforts to achieve a more inclusive Union research programme by giving support, setting clear targets and organising special research programmes for under-represented target groups, such as women and young people, also aspiring for balanced geographical distribution across the Union;
(iv) encourage and support Members States, specially ‘catch-up countries’, to fully exploit the synergies between available Union funds, including RRF and Cohesion funds, to increase the number of research and innovation activities in these countries; and
(v) continue the funding to create an integrated, innovative and resilient Energy Union that promotes secure, sustainable, competitive and affordable energy for all, particularly SMEs and vulnerable and energy-poor consumers, while accelerating Europe’s clean and just energy transition for it to become the first climate-neutral continent by 2050;
Cohesion, Resilience and Values
67. Notes that the budget for the programmes under MFF heading 2 ‘Cohesion, resilience and values’ was EUR 79,1 billion (40,4 % of the Union budget) distributed as follows: 53,6 % for the European Regional Development Fund (ERDF) and other regional operations, 23,6 % for the European Social Fund (ESF), 12,6 % for the Cohesion Fund (CF), 4,4 % for Erasmus+, 2,3 % for CEF Transport, 0,6 % for ESI and 2,9 % for other areas; notes that as of 31 December 2022 the final adopted budget commitments appropriations were EUR 67 805,19 million and 98,29 % of them were implemented (EUR 66 644,24 million); notes further that the final adopted budget payment appropriations amounted to EUR 63 104,31 million and 99,86 % of them were implemented (EUR 63 054,76 million);
68. Notes that in 2022, the implementation of the cohesion policy under the 2014-2020 programming period continued and that for the 2021-2027 period, the Commission concluded the negotiations of all programmes and made only advance payments, which amounted to EUR 6,5 billion;
69. Takes note that the absorption rate for cohesion policy funds under the programming period 2014-2020 reached 79,2 % at the end of 2022 (86 % at the end of 2023, including newly added Recovery assistance for cohesion and the territories of Europe (REACT-EU) in 2021-2022), having a similar level at the same point in time as in the period 2007-2013; notes that the 2014-2020 programmes account for over 1 million projects and that so far, they have supported 2,4 million businesses, created 370 000 new jobs, increased the energy performance of more than 540 000 households, created 6 000 megawatts of new renewable energy sources and that 6,3 million households benefited from broadband;
70. Notes further that, in 2022, Cohesion's Action for Refugees in Europe (CARE) and the Flexible Assistance to Territories (FAST-CARE) mobilised over EUR 1,3 billion to help Member States and regions to support millions of Ukrainian refugees seeking shelter in Union territory, including mainstream social integration programmes, healthcare, food or essential assistance, and orientation for the job market; welcomes that the proposed measures are subject to the same obligations regarding adequate management and control systems and sound financial management that apply to cohesion policy funds;
71. Notes that the Court has examined a sample of 260 transactions covering the full range of spending under MFF Heading 2; notes with concern that the Court’s estimated overall level of error in ‘Cohesion, resilience and values’ in 2022 was 6,4 %, which is above the materiality threshold; draws attention to the marked increase in the overall level of error estimated by the Court in 2022 compared to previous years (3,6 % in 2021, 3,5 % in 2020) while the Commission estimates the payment risk for 2022 to be between 1,9 % and 2,7 %, remaining stable compared to previous years (1,9 %-2,5 % in 2021, 2,1 %-2,6 % in 2020);
72. Notes the Court’s observation that approaching the end of the eligibility period for 2014-2020 programmes (31 December 2023) added absorption pressure and that during the COVID-19 period, the effectiveness of the checks and verifications by managing and audit authorities may have been reduced, potentially increasing the risk of undetected errors and irregularities; takes note that the Commission acknowledges that the specific situation and flexibilities given during COVID-19 may have played a role in the risk of irregularities due to the need to find alternative (remote) ways to control expenditure; stresses, however, that according to the Commission the risks and irregularities identified are rather linked to the type of actions implemented during the COVID-19 period or to the implementation or understanding of the flexibility introduced in public procurement rules;
73. Notes the Court’s explanations that its error rate refers to the share of expenditure declared, for which it considers that the conditions for payment set out in Regulation (EU, Euratom) 2018/1046 (‘the Financial Regulation’) , the CPR and inDirective (EU) 2017/1371on the protection of the Union’s financial interests (‘PIF Directive’) have not been fully met, leading to a direct and measurable financial impact on the payment amount authorised at the time from the Union budget; takes note of the Court’s clarification that the error rate should not be interpreted as being equivalent to the potential amount of financial corrections the Commission can impose in accordance with the applicable rules;
74. Notes that in the annual activity reports, the Commission reports error rates, for each programme and overall for the funds, that strictly refer to irregularities leading to financial corrections; notes that to impose financial corrections, the Commission needs to conclude that an irregularity within the meaning of the Article 2(36) of the CPR has occurred, while not all formal breaches and errors included by the Court as quantifiable errors in its estimated error rate lead to ineligible expenditure because they do not qualify as an irregularity as defined in Article 2(36) of the CPR;
75. Welcomes that the Commission accepts allrecommendations of the Court and its commitment to clarify applicable rules and audit work required with all stakeholders, including in close cooperation with the Court, to limit these divergences in future assessments and quantification of errors; encourages the two institutions, together with all relevant stakeholders, to work further to reduce divergences in order to ensure legal clarity and to ensure that audits do not lead to an excessive administrative burden on beneficiaries and, in this way, policy objectives are reached on the ground;
76. Notes that the Court identified an increase in the specific types of errors, such as ineligible costs and projects and infringements of internal market rules, including public procurement and state aid rules, which are the same categories of irregularities identified by the Commission and the audit authorities based on their common typology; notes that 3 % of the Court’s estimated 6,4 % error rate in Heading 2 is related to 100% co-financed priorities under the Coronavirus Response Investment Initiative (CRII+) which allowed for more flexible spending; notes that the Commission has not found audit evidence of a significant impact overall of the new types of measures and flexibilities introduced on the programme error rates and takes note of the fact that the Commission took measures to prevent such risk;
77. Takes note that for ERDF and CF, the Commission implemented financial corrections and withdrawals amounting to EUR 11 billion over the programming period, including EUR 2,4 billion for the accounting year 2021-2022; notes further that the Commission continues the implementation of its targeted ‘action plan on public procurement’ in cooperation with Member States;
78. Notes the Court’s remark that the overlap of programming periods, combined with the availability of additional funding instruments under NGEU (REACT-EU and the RRF), with a more limited lifetime, may have put a strain on the administrative capacity of Member States in the programming period and at the start of the implementation of their 2021-2027 cohesion programmes; notes that in 2022, national and regional authorities had to shift their focus on reprogramming the 2014-2020 cohesion policy programmes, including the introduction of measures funded under CRII(+), REACT-EU, Flexible Assistance to Territories (FAST-CARE) and Supporting Affordable Energy (SAFE), as well as implementing the national plans under the RRF, in order to address different crisis, recovery and rescue measures; notes that the Directorate-General for Regional and Urban policy (DG REGIO) provides support to the national and regional authorities to ensure full implementation of the 2014-2020 programmes;
79. Notes that complementarity characterises the relation between the cohesion policy funds and the other Union funding instruments; recalls that the cohesion policy funds and the RRF are different in terms of general objectives, timeline, management mode and financing, but highlights that complementarity between them is possible and expected, provided the same costs are not covered twice;
80. Notes that the Commission is closely monitoring the situation, in particular when RRF national coordinating authorities are the same as for cohesion policy funds, and insisted on having sufficient additional administrative capacity and human resources allocated to the different strands of Union funding;
81. Welcomes that neither the Court nor the Commission identify any cases where the obligatory national co-funding of a cohesion project was paid for by RRF funds in the 2022 RRF disbursements;
82. Notes that the Court considers that the Commission’s desk reviews and compliance audits have inherent limitations in confirming the validity of the residual total error rates reported by audit authorities; takes note of the Commission’s reply that its assessment, based on a combination of desk and on-the-spot audit work covering the different individual programmes and assurance packages, enables it to establish a reasonable and fair estimate of the error rates for each programme, every year, and cumulatively for cohesion policy funds;
83. Notes the Court’s finding that the proportion of assurance packages with residual error rates of above 2 % reached a peak of 61 % of the expenditure in the Court’s sample in 2022 compared to 39 % in the previous year, reflecting the persistent shortcomings in the work of the audit authorities; stresses with concern that the Court’s audit results over the last six years demonstrate that the controls currently in place do not yet sufficiently offset the high inherent risk of error in cohesion, and that managing authorities do not always effectively prevent or detect irregularities in expenditure declared by beneficiaries; notes with concern that the errors found by the Court represent significant weaknesses in the audit authorities’ work on verifying the eligibility of expenditures and projects, and the compliance with internal market rules; notes that a part of the residual error rates recalculated by the Court above 2 % in the audited assurance packages are attributable to the aforementioned divergences;
84. Is concerned about the persistent shortcomings observed by the Court in the national audits, which can be due to inadequate scope, unclear documentation of audits and sample filtering performed by national audit authorities, as well as resource issues, including inadequate funding and a lack of a skilled workforce within national audit authorities; notes that the Commission considers the work of the majority of the audit authorities to be reliable and that only 7 out of 81 audit authorities need serious improvements;
85. Notes the Court’s finding that, as a way to simplify expenditure, beneficiaries of cohesion policy funding used SCOs for 77 transactions, or 30% of its sample, applying either flat rates, standard sales of unit costs or a combination of both; stresses that SCOs are one of the most important measures to reduce administrative costs and burdens for the beneficiaries and thus, to facilitate the access of small beneficiaries to the funding and focus more on the achievement of the objectives while reducing the error rate;
86. Notes that, for 2021-2027 programmes, the Commission has encouraged the use by programme authorities of the simplification measures foreseen under the CPR, in particular, the use of SCOs and financing not linked to costs (FNLC) schemes to tackle eligibility issues, ease management verifications and control the burden on beneficiaries; notes that, as a result of this effort, for the ERDF and the CF for example, 120 SCO schemes at programme level were adopted so far in 11 Member States and for Interreg programmes (EUR 5,7 billion of total contribution) as well as 4 FNLC schemes in 4 Member States (for EUR 1,2 billion of total contribution);
87. Recalls that for the 2021-2027 period, Member States need to comply with certain horizontal or thematic enabling conditions of the CPR, which are prerequisite conditions for the effective and efficient implementation of the specific objectives of the funds; recalls that when enabling conditions are not fulfilled at the time of submission of a payment application to the Commission for the specific objective concerned, the related expenditure will not be reimbursed from the Union budget until the Commission is satisfied that the enabling condition has been fulfilled;
88. Notes from the Annual Report on the Protection of the EU Financial Interests for the year 2022 (PIF Report) that from 2021 to 2022, the number of fraudulent irregularities relating to the Cohesion Policy increased by 4,2 %, while non-fraudulent irregularities increased by 10,2 %; notes that the Commission requested audit authorities to pay particular attention to new risks related to the multiplication of Funds and additional funding under NGEU, in particular, ‘double funding’, conflicts of interest, fraud or corruption; notes the efforts made by the Commission to promote the use of the ARACHNE risk scoring tool to the reluctant Member States, and to introduce improvements in the tool; notes that the audit authorities explicitly addressed the risk of fraud for 65 % of the audited operations in the 2014-2020 period, which is an improvement on the 38 % found in 2021 by the Court;
Recommendations
89. Calls on the Commission to:
(i) continue its cooperation with the Court in order to look for possible comparability of the results of their estimated error rates, as well as to align the interpretation of legal texts;
(ii) pay particular attention in its audits to the risks linked to the flexibilities introduced with the CRII/CRII+ amendments;
(iii) continue its support to Member States given the completion of the 2014-2020 programming period and the implementation of the current one, in particular by supporting administrative capacity building;
(iv) continue the implementation of its targeted “action plan on public procurement” in cooperation with Member States to help programme authorities and contracting authorities to improve their practices in the area of public procurement, including how to avoid the most common errors in public procurement linked to the management of the ESI Funds, as well as targeted training sessions for Member States’ officials;
(v) further enhance simplification in the implementation of cohesion programmes and work closely with Member States to identify best practices regarding the digitalisation of practices and procedures;
(vi) work, in order to achieve a successful uptake of SCOs, in parallel with all stakeholders, on methodological and assurance harmonisation so that there is sufficient predictability for the beneficiaries on how those options are expected to be implemented; and ensure that audits do not lead to further bureaucratisation of implementation and an unnecessary audit burden on beneficiaries;
(vii) work together with Member States' audit authorities to ensure that the specific risk of double funding, especially with the RRF financing, is well covered by national controls and audits; insists that the Commission performs thematic or compliance audits tailored to target high-risk areas and Member States; and
(viii) establish a comprehensive mechanism for the use of cohesion funds in the event of exceptional or unforeseen circumstances using guiding provisions on its scope, funding availability, governance, audit and control, and application;
Natural resources
90. Notes that the budget for the programmes under MFF heading 3 ‘Natural resources’ was EUR 58,1 billion (29,7 % of the Union budget) distributed as follows: 65,9 % for direct payments under the European Agricultural Guarantee fund (EAGF), 26,2 % for the Agricultural Fund for Rural Development (EARDF), 4,7 % for market-related expenditure under the EAGF, 1,8 % for Maritime and Fisheries, 0,9 % for Environment and Climate (LIFE), and 0,5 % for other areas; notes that as of 31 December 2022, under MFF heading 3 ‘Natural Resources and Environment’ the final adopted budget commitments appropriations were EUR 56 681,11 million and 98,92 % of them were implemented (EUR 56 069,86 million); notes further that the final adopted budget payment appropriations amounted to EUR 55 781,71 million and 98,95 % of them were implemented (EUR 55 197,56 million);
91. Notes that 2022 was the second and last year of the transitional period during which funds from the Common Agricultural Policy (CAP) 2021-2027 budget allocation and an additional EUR 8 billion of externally assigned revenue from the NextGenerationEU funds for the European Agricultural Fund for Rural Development Fund (EAFRD) could be used by Member States for continued payments to farmers and other CAP beneficiaries in anticipation of the entry into force of the new CAP on 1 January 2023;
92. Notes that, in the financial year 2022, there were more than 5,9million beneficiaries of direct support schemes, around 3,5 million beneficiaries of rural development measures and some 0,11 million beneficiaries of market measures; stresses that the resilience of the Union farmers and food system has continued to ensure food security in the Union and beyond, despite the challenges they faced in 2022;
93. Notes that Russia-s unprovoked war of aggression against Ukraine triggered, among other actions, the activation of the crisis reserve in the form of a support package that amounted to EUR 500 million, out of which EUR 350 million was made available for affected producers from the reserve and another EUR 150 million from the EAGF; welcomes the high execution rate (above EUR 492 million) and the fast implementation; notes that Member States were given flexibility in deciding on the sectors they considered most hit by the market disturbance and also the types of aid schemes, which determined the control system applied;
94. Notes that the Court has examined a sample of 218 transactions covering the full range of spending under this MFF heading; notes that the Court also examined the regularity information given in the annual activity reports of the Directorate-General for Agriculture and Rural Development (DG AGRI) and the Directorate-General for Climate Action (DG CLIMA), as well as selected systems in 17 Member States and the United Kingdom; notes that the Court estimates the level of error for ‘Natural Resources’ to be 2,2 % (1,8 % in 2022) and that the majority of the errors found affected rural development transactions; notes that DG AGRI estimates a risk at payment of 1,76 %;
95. Notes that the Court found 21 quantifiable errors in rural development, 7 in direct payments, 2 in expenditure related to market measures and 2 in non-CAP expenditure; is reassured by the fact that the Commission stated that 8 of the quantifiable errors have a financial impact below EUR 100 (over-declaration of areas) and for most of them, the amount misspent is below EUR 1 000;
96. Notes that the majority of errors found by the Court were related to the provision of inaccurate information on areas or animals (42 %) and ineligible beneficiary, activity, and project, expenditure; notes with concern, as in 2022, that the Court found in several cases that the Member State authorities and the Commission had sufficient information to prevent, or to detect and correct the error before accepting the expenditure and that this would have resulted in a lower error rate estimated at 1,3 %;
97. Welcomes the Commission’s statement that the 2023-2027 CAP delivery model aims to simplify rules and to emphasise the use of new technologies, such as the Area Monitoring System, that will help reduce errors; notes that, together with errors made by the farmers, the Land Parcel Identification System (LPIS) is the basis for the geospatial aid application and recalls the significant potential benefits of technologies for monitoring area aid for farmers, administrations and the environment;
98. Notes the example of an incorrect declaration of agricultural activity presented by the Court in its annual report, quoted in several media as the “lemon trees’ case”, where a farmer declared to cultivate permanent crop, where in reality the plot was not cultivated for several years; notes the financial impact of this error was EUR 8 349,06 as reported by the Commission, along with the corrective actions taken by the responsible national authorities, including the recovery of the claimed amount; commends the thorough audit work of the Court and the Commission and the swift follow-up by the paying agency concerned;
99. Notes that SCOs are applied across the CAP, including in rural development where eligibility conditions are more complex and the risk of error is higher, and that there is still potential to simplify measures that are not based on area or animal declarations, where Member States can decide whether to reimburse actual costs or pay according to predefined outputs; notes that the Commission reports almost 92 % of Rural Development Programmes make use of SCOs;
100. Recalls that the CAP assurance model includes the first level controls by the paying agencies, the audit work carried out by the independent certification bodies that provide annual opinions on the legality and regularity of the expenditure of paying agencies, and the Commission's work through the clearance of accounts; welcomes that, despite some inconsistencies due to the different update schedules of the control and payment datasets, the Court found that the selected paying agencies’ systems reliably calculated the aid payments, which is a testament to the overall quality and coherence of the Member States’ control statistics and payments data reported to the Commission;
101. Welcomes the increased interest in and use of the integrated IT tool for data mining ARACHNE by the Member States, with 13 Member States using the tool for at least some measures, and five Member States participating in a general introduction workshop on ARACHNE; notes the obstacles reported by Member States and the continued efforts of the Commission to improve ARACHNE;
102. Notes that, in 2022, the Commission reported an implementation rate of 99,69 %, for commitments under the European Maritime, Fisheries and Aquaculture Fund (EMFAF), a marked improvement from the 15,98 % implementation rate of its predecessor, the European Maritime and Fisheries Fund (EMFF) in 2021; notes, however, that 94,76 % from the EUR 1 135,74 million committed appropriations in 2022 and 97,06 % from EUR 148,12 million in 2021 remained unpaid at the end of the corresponding year; notes further that the implementation rate of the authorised payment appropriations for EMFAF in 2022 was 99,99 % and for EMFF in 2021 was 86,55 %;
103. Notes the Court’s Special report 09/2023 on securing agricultural product supply chains during COVID-19 and its conclusion that the Commission’s response to the threat posed to agricultural product supply chains by the COVID-19 pandemic was appropriate in most respects but insufficiently targeted; recalls that direct support, with a budget of EUR 712 million, was implemented quickly through reallocation of unused funds from EAFRD, which resulted in this measure mostly being taken up by the Member States with a significant portion of the EAFRD budget unused at the end of 2019; recalls further that 5 of the 14 member states made the Union funding available to all farmers that suffered losses, whereas the other 9 targeted selected sectors and supported beneficiaries irrespective of whether they had suffered losses;
Recommendations
104. Calls on the Commission to:
(i) devote explicit attention in the ex-post evaluation of the CAP 2014-2020 to the transitional period 2021-2022 and the additional requirements included in the transitional provisions in Regulation (EU) 2020/2220 ;
(ii) explain to the discharge authority why the implementation rate of commitments under the EMFAF is so much higher than the implementation rate of its predecessor;
(iii) keep the discharge authority informed on the use of SCOs in the current and new CAP and evaluate their use with Member States’ authorities and (potential) beneficiaries to understand the relatively slow uptake of these options;
(iv) to carefully consider the risk indicators in ARACHNE with the aim of reducing the number of false indicators and make the remaining ones more efficient in detecting situations with a high risk for the protection of the Union’s financial interests; and
(v) promote, provide incentives and support the Member States’ paying agencies in using IT tools like checks by monitoring and other imaging technologies in the field of agri-monitoring;
Migration and Border management, Security and Defence
105. Notes that the budget for the programmes under MFF heading 4 ‘Migration and Border Management’ was EUR 3,4 billion (1,7 % of the Union budget) distributed as follows: 43,9 % for the Asylum, Migration and Integration Fund (AMIF), 23,1 % for the Integrated Border Management Fund (IBMF) and 33 % for three decentralised agencies: European Boarder Coast Agency (FRONTEX), European Union Agency for Asylum (EUAA) and European Union Agency for the Operational Management of Large-Scale IT Systems in the Area of Freedom, Security and Justice (EU- LISA); notes that, as of 31 December 2022, the final budget commitment appropriations adopted amounted to EUR 3 410,39 million and 99,54 % of them had been implemented (EUR 3 394,69 million); notes further that the final adopted budget payment appropriations amounted to EUR 3 372,54 million and 9761 % of them have been implemented (EUR 3 292,03 million);
106. Notes that the budget for the programmes under MFF heading 5 ‘Security and Defence’ was EUR 1,2 billion distributed as follows: 45,6 % for the European Defence Fund (EDF), 17 % for the Internal Security Fund (ISF), 19,2 % for decentralised agencies The European Monitoring Centre for Drugs and Drug Addiction (EMCDDA), Europol and European Union Agency for Law Enforcement Training (CEPOL), 6,8 % for nuclear safety and decommissioning, and 11,4 % for other areas; notes that, as of 31 December 2022, the final adopted budget commitment appropriations were EUR 1 813,03 million and 99,8 % of them had been implemented (EUR 1 809,43 million); notes further that the final adopted budget payment appropriations amounted to EUR 1 158.67 million and 97,54 % of them have been implemented (EUR 1 130,20 million);
107. Notes that a significant portion of the spending under MFF headings 4 and 5 in 2022 concerned the completion of projects remaining from the 2014-2020 MFF; notes that significant amounts of AMIF and ISF national programmes for 2014-2020 remain undisbursed (26 % for AMIF and 33 % for the ISF at the end of 2022) while funding for 2014-2020 has to be spent by June 2024;
108. Notes that the Court examined a sample of 23 transactions that is not representative enough of the spending under MFF headings 4 and 5 and, therefore, cannot provide an estimate of the error rate; notes that the Court’s audit results show that the expenditure is affected by eligibility and procurement issues and that it is a high-risk area (11 out of 23 transactions audited, i.e. 48 %, were affected by errors); notes that the Court quantified nine errors which had an impact on the amounts charged to the Union budget and that it also found four cases of non-compliance with legal and financial provisions, which had no impact on the Union budget; notes that the Commission concludes that the risk at payment is below 2% for the expenditure on migration and border management, as well as for security and defence;
109. Welcomes the progress identified by the Court in its review of the work done by six Member States’ audit authorities in preparation for the 2021-2027 AMIF, the Border Management and Visa Instrument (BMVI) and ISF annual accounts; notes the Court’s observation that, at the time of its visits (between September 2022 and February 2023), the six Member States’ audit strategies had not yet been adopted, which is a prerequisite for submitting an ‘assurance package’;
110. Notes that DG DEFIS’ anti-fraud strategy was updated in February 2022 and its implementation is being monitored and reported to the management annually; welcomes that 100 % of OLAF’s recommendations regarding DG DEFIS were implemented and that no incidences of fraud have been reported at the Commission level or by its partners; notes that the last update of the Directorate-General for Migration and Home Affairs (DG HOME)’s anti-fraud strategy took place in October 2021 and is currently being implemented; welcomes that, by the end of 2022, 72 % of OLAF’s financial recommendations from the previous year were fully implemented and 28 % were under implementation;
Migration and border management
111. Notes that in 2022 the funds under MFF heading 4 were instrumental in addressing the impact of the war in Ukraine; takes note that more flexibility was introduced under the 2014-2020 funds to enhance Member States’ possibilities to channel funding towards new needs, and EUR 400 million of Emergency Assistance was triggered under the Thematic Facilities; notes that the adoption of the Member States’ programmes for 2021-2027 allowed them to access to more than EUR 10 billion under the new funds for the programming period;
112. Notes that more than 16 million people from Ukraine and Moldova have been recorded as having entered the Union since the beginning of the war in Ukraine, and over 4 million persons fleeing the war obtained protection in the Union; notes that the Commission provided financial support to the International Organisation for Migration to support the process, as part of a EUR 15 million project facilitating transfers of vulnerable persons from Moldova fleeing Ukraine; notes further that on 30 November 2022, the Commission announced the decision to award financial support of EUR 5,5 million to a project to be carried out by the International Federation of the Red Cross and Crescent Societies (IFRC) to support hosts and all those involved in providing private accommodation to displaced people, putting together good practices for future needs; takes note that, in 2022, in the context of financing Ukraine, the Commission adopted decisions authorising the use of the funding not linked to costs amounting to EUR 248 million (May 2022) and EUR 137 million (August 2022), as well as for smaller grants, safe homes and psychosocial support amounting to EUR 15 million;
113. Notes that in 2022 DG HOME provided EUR 27 million for the exchange of security-related information and EUR 25,5 million for combatting and preventing crime, including terrorism; notes further that in July 2022, through the Internal Security Fund (ISF), the Commission allocated EUR 15,7 million to Member States to further support long-term projects and activities within the European Multidisciplinary Platform Against Criminal Threats (EMPACT) - a security instrument “driven” by Member States to identify, prioritise and address threats posed by organised and serious international crime,
Security and defence
114. Welcomes that the participation of SMEs in the EDF (in particular the cross-border participation of SMEs in industrial consortia) is being facilitated through targeted EDF calls, financial bonuses, specific award criteria, and the use of SCOs to decrease the administrative burden; notes that in the 2022 EDF calls, 38,2 % of the participating entities were SMEs, and 20 % of the total funding available through these calls will be for SMEs (EUR 166 million);
115. Recalls that the Preparatory Action on Defence Research (PADR) was a precursor programme of the EDF with a budget of EUR 90 million that funded 18 research projects selected following calls for proposals in the years 2017 to 2019; notes with concern that the Court, in its Special Report 10/2023 ‘The Preparatory action on defence research’, observes that the Union still lacks a long-term strategy for the projects under the EDF, particularly in terms of impact, additional research, development, manufacturing, procurement, and other aspects; welcomes that the Commission has accepted all of the Court’s recommendations;
116. Notes the Court’s observations in its Special Report 10/2023 regarding the limited availability of human resources at the Commission and the subsequent risk for the EDF; notes that, as a result of security issues, the number of staff needed to manage defence projects is higher than for other projects; notes that the ever-growing number of proposals to evaluate and projects to manage puts considerable pressure on human resources and creates challenges in terms of recruiting qualified and suitably experienced staff;
Recommendations
117. Calls on the Commission to:
(i) secure the provision of adequate budget and skilled human resources to enhance defence cooperation and investment and to implement the EDF; and
(ii) monitor the implementation of the outstanding OLAF’s financial recommendations;
Neighbourhood and the world
118. Notes that the budget for the programmes under MFF heading 6 ‘Neighbourhood and the world’ was EUR 14,5 billion (7,4 % of the Union budget) distributed as follows: 64,8 % for the Neighbourhood, Development and International Cooperation Instrument - Global Europe (NDICI-Global Europe), 16,8 % for Humanitarian Aid (HUMA), 14,4 % for Pre-Accession Assistance (IPA III) and 4 % for other actions and programmes; notes that as of 31 December 2022, the final adopted budget commitment appropriations were EUR 17 670,49 million and 99,79 % of them were implemented (EUR 17 632,52 million); notes further that the final adopted budget payment appropriations amounted to EUR 13 156,10 million and 99,19 % of them were implemented (EUR 13 049,50 million);
119. Notes that the Court examined a sample of 72 transactions which is not representative enough of the spending under this MFF heading and, therefore, cannot provide an estimate of the error rate; notes that the Court’s audit results show that this is a high-risk area (34 out of 72 transactions audited, i.e. 47 %, were affected by errors); notes that the Court found 25 errors that had a financial impact on the Union budget, relating to ineligible costs, absence of supporting documents, public procurement and expenditure not incurred;
120. Recalls that the Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR) reports the risk at closure in its Annual Activity Reports (AARs) based on a study carried out by an external contractor, known as the residual error rate (RER), the aim of which is to estimate the rate of errors not detected by the internal control system and to conclude whether it is effective or not; notes the results of the 2022 RER study that the residual error rate in 2022 is 1 % and thus, below the materiality threshold of 2 %;
121. Notes that the Court identified limitations regarding the methodology used to determine the RER that may contribute to its underestimation, in particular, that the contractor can rely entirely on the results of previous control work in some cases and the fact that the estimation of the residual error rate for grants under direct management is not included in the calculation of DG NEAR’s overall RER; notes that the Commission affirms that it is not subject to such limitations because (i) the reliance on previous control work is subject to strict conditions and (ii) the global error rate includes grants under direct management;
122. Welcomes that the Commission implemented the Court’s recommendations to disclose the limitations of the RER study in DG NEAR’s AARs since 2021, to strengthen checks by identifying and preventing recurrent errors, and for DG NEAR to establish obligations for the RER study contractor to report to the Commission any suspected fraud against the Union budget detected during its work on the RER study;
123. Notes with concern that the AARs of DG NEAR and the Directorate-General for International Partnerships (DG INTPA) reported difficulties in the implementation of the new operational information system OPSYS, which was at times unstable, failing to meet expectations, and requiring frequent intervention from DG DIGIT support teams, leading to it being identified as a critical risk in DG NEAR’s risk assessment exercise;
124. Notes that the Court assessed awareness raising among Union delegation staff in the areas of fraud prevention, ethics and integrity; notes with concern that some members of staff interviewed by the Court had not been trained in fraud prevention in the past five years; notes that DG NEAR makes a series of tools and resources available to its staff to cover fraud-related issues, such as training, an anti-fraud network with focal points and guidance; notes the positive results of the surveys carried out by DG NEAR to monitor the level of fraud awareness of its staff, as well as that some areas for improvement were identified and an action plan is being implemented;
125. Welcomes the implementation by the Commission of several mechanisms to mitigate risks and safeguard the proper use of Union funds spent in unstable or conflict zones; notes that the Commission systematically assesses corruption risks in partner countries and uses an array of tools to mitigate them, at the same time applies conditions and performance indicators to promote fiscal transparency and accountability through its budget support; welcomes the fact that, according to World Bank data, countries benefiting from Union budget support have improved in the control of corruption over time;
126. Notes with concern that the Court, in its Special Report 14/2023 “Programming the Neighbourhood, Development and International Cooperation Instrument – Global Europe” found that, although the Commission and the EEAS had merged funding into a single instrument, the NDICI-Global Europe Instrument, which covers more than 70 % of the Union funding allocated for external action in the 2021-2027 financing period, they followed two different fund allocation methodologies for Neighbourhood and non-Neighbourhood countries, and that the multiannual indicative programmes did not ensure that the selected sectors of intervention were those in which Union funding could achieve an impact;
127. Notes that, following the despicable terrorist attacks carried out by Hamas against Israel on 7 October 2023, the Commission announced on 9 October 2023 its decision to review the Union’s assistance for Palestine; welcomes that the review, finalised on 21 November 2023, has shown that the Commission has ex-ante and ex-post controls, and a system of safeguards in placethat work well and that no evidence has been found to date that money has been diverted for unintended purposes; highlights, furthermore, that according to the Commission’s reply, the current rules in tender procedures and calls for proposals “make the participation of entities, individuals or groups affiliated with terrorist organisations categorically incompatible with any Union funding”;
128. Notes that, in 2022, DG NEAR paid EUR 910,8 million in bilateral assistance to Ukraine, out of which EUR 698 million was paid through Budget Support; notes that close to EUR 200 million of ongoing projects were successfully repurposed to reach the beneficiaries before humanitarian partners could mobilise their aid programmes; notes that the constraints on adequately monitoring projects in Ukraine lead to a reservation in the 2022 AAR of DG NEAR and that corrective actions are being implemented, such as monitoring progress on project implementation through desk reviews, remote solutions and using a service provider;
129. Welcomes that OLAF signed administrative cooperation arrangements with both the Prosecutor General’s Office of Ukraine on 11 February 2021 and the State Audit Service of Ukraine in March 2023; notes that Ukraine is soon expected to be associated with the Union Anti-Fraud Programme (UAFP) and welcomes that OLAF is providing support to the Ukrainian authorities in their national anti-fraud efforts and strategies; welcomes that the EPPO signed working arrangements with the National Anti-Corruption Bureau of Ukraine, in July 2023, aiming to facilitate the cooperation in investigating corruption cases, and with the Ukrainian Prosecutor General’s Office, in March 2022, to protect the financial interest of the Union and Ukraine through effective investigation and prosecution;
Recommendations
130. Calls on the Commission to:
(i) as regards the OPSYS application system, enhance the quality of the new software, stabilise the application and improve interfaces between the different OPSYS modules, and allocate resources needed to enhance its maturity/robustness;
(ii) continue ensuring that all contracts involving Union funding fully respect applicable Union legislation, including accountability, transparency and protection of Union funds; make the participation of entities, individuals or groups affiliated with terrorist organisations categorically incompatible with any Union funding; and ensure that strict monitoring and control mechanisms make sure that all individuals involved in Union funded actions exclusively pursue the objectives and activities approved for Union funding;
(iii) put in place adequate control measures in unstable or conflict zones to ensure the proper control of spending of Union funds;
European public administration
Human Resources
131. Notes that the budget for the programmes under MFF Heading 7 ‘European Public Administration’ was EUR 11,6 billion (5,9 % of the Union budget), which comprises the expenditure of the Union institutions and bodies on human resources and pensions (about 70 % of the total), buildings, equipment, energy, communications and information technology; notes that of the total amount, 58,6 % is spent by the Commission (EUR 6,7 billion); notes that, as of 31 December 2022, the final adopted budget commitment appropriations for the European Commission were EUR 6 298,13 million (99,84 % of them were implemented, i.e. EUR 6 288,14 million), as well as that the final adopted budget payment appropriations amounted to EUR 6 298,22 million (94,66 % of them were implemented, i.e. EUR 5 961,72 million);
132. Notes that the Court examined a sample of 60 transactions covering the full range of spending under the MFF Heading 7 involving all the Union institutions and bodies; notes that the Court also examined the regularity information given in the AARs of all the institutions and bodies, including those of the Commission’s directorates-general and offices primarily responsible for administrative expenditure, and then included in the Commission’s AMPR; notes with satisfaction that the Court estimates that the level of error in the MFF Heading 7 was not material and notes that there are no new recommendations addressed to the Commission;
133. Notes that the Commission adopted its new Human Resources strategy (‘HR Strategy’) in April 2022, which aims to address emerging needs after the COVID-19 crisis and focuses on achieving an attractive workplace, faster and more agile selection and recruitment, and a flexible and rewarding career for all staff; notes that the document is a set of intentions for change and improvement that should gradually be implemented, and that part of its content shall be first negotiated in social dialogue with staff representatives;
134. Notes that the Commission has increasingly recruited contractual or temporary agents on permanent posts to carry out new tasks stemming from rapidly evolving priorities, in response to special or urgent situations and even to compensate geographically unbalanced recruitments; recalls its concerns about the loss of knowledge for the institutions, as well as the negative impact on perspective and job security of the members of staff concerned; highlights that recruiting contractual or temporary agents is not a sustainable solution to the decreasing and geographically unbalanced applications of those applying for Union competitions and, most importantly, to the long-identified and complex issue of the Union’s decrease of attractiveness as an employer;
135. Notes with satisfaction that the percentage of women in management functions has risen considerably since the beginning of the mandate: in July 2023, the share of women in management functions was 45,2 % at senior management level (up nearly 9 percentage points since the beginning of the mandate) and 47,5 % at middle management level (up 6 percentage points);
136. Acknowledges that, in order to ensure recruitment on the broadest possible geographical basis it is necessary to address the causes of the under-representation from the point of initial recruitment; welcomes that, to strengthen geographical balance across different categories of Commission staff, the Directorate-General for Human Resources and Security (DG HR) met all Member States to discuss their representation and finalised all joint action plans taking into account the specificities of each Member State to address the possible causes of under-representation jointly;
137. Recalls the Court’s audit of the activities of the European Personnel Selection Office (EPSO) and the observations regarding its efficacy and efficiency; notes that, in 2022-2023, EPSO introduced remotely proctored testing and deplores that this system is now being reappraised due to the numerous technical difficulties experienced by many candidates; regrets the inconvenience caused to candidates, the direct budgetary costs of the suspension of the external competitions, and the additional effort made by the Commission’s recruiting services to find an adequate replacement;
Buildings and administration
138. Notes that the new central corporate financial system of the Commission, SUMMA, was planned to go into production by the end of 2023 and had progressed in line with the objective of going live at the beginning of 2024; notes that the deadline for implementing the new accounting system was extended by one year because implementing the connections of operational programmes (shared management, e-grants, e-procurement, staff payments) with SUMMA simultaneously has proven to be a more complex exercise than expected; stresses with concern that the cost of the SUMMA programme since its inception at the beginning of 2018 until the end of 2022 was around EUR 95 million and that its timeline extension will require additional resources in 2024, estimated at around EUR 7 million euro;
139. Notes the media reports on negotiations between the Belgian Government and the Commission on a real estate transaction worth nearly EUR 1 billion and, likewise, the Commission’s plans to rent office spaces in the Brussels North area, including reluctance on the part of the staff concerned; stresses that any development in the Commission’s real estate policies shouldn't degrade the working conditions of its personnel;
European Schools
140. Notes with satisfaction that the Court, in its Annual Report on the accounts for he European Schools for the 2022 financial year, found no material errors in the final consolidated annual accounts of the European Schools for 2022; welcomes further improvements highlighted by the Court in the quality of the final individual and consolidated accounts compared to previous years;
141. Notes with concern that both the Court and the external auditor found immaterial errors, which mainly related to the calculation of provisions for post-employment benefits and that the audit opinions of the external auditor were not in line with the framework contract concluded with the Office of the Secretary-General (the ‘Central Office’);
142. Notes that the Court, while praising improvements in recruitment and procurement procedures in the Central Office, found, for two out of the seven schools it reviewed (Frankfurt and Luxembourg I), shortcomings in these procedures; notes with concern that the Court, once again, noted weaknesses in terms of payment procedures for both the Central Office and the two schools that were reviewed;
143. Recalls that the Parliament, in its resolution of 12 September 2023 on the system of European Schools: state of play, challenges and perspectives, stressed that the current system of teacher recruitment in the European Schools System (EES) has serious shortcomings, resulting in a mismatch between the needs on the ground and the actual staff seconded by the Member States, issues with yearly recruitment plans, difficulties in finding qualified teachers and staff, precarious working conditions for locally recruited teachers and other educational staff and problems with continuous professional development;
Recommendations
144. Calls on the Commission to:
(i) take into account on an equal footing the efficient use of office spaces and the health and well-being of staff while implementing the new HR strategy, in particular regarding people with disabilities, as well as duly involve staff representatives when changing work conditions;
(ii) remain vigilant regarding the prevention, identification and adequate management of burnout cases in the larger context of staffing, workload and staff well-being;
(iii) reinforce the measures to support women pursuing a management career in order to increase the number of applications from highly qualified women to middle and senior management functions within both the Commission and the Union agencies;
(iv) continue its work to strengthen the geographical balance of its staff at all levels while at the same time fulfilling the requirements in the Staff Regulations regarding competences and merits of candidates;
(v) making appropriate investments in building IT capabilities and resources for EPSO to be more efficient and effective and, in particular, to ensure optimal testing conditions in future selection processes; and
(vi) ensure a better and stricter risk management approach towards the readiness of the SUMMA deployment and avoid material risks of temporary disruption until the new accounting system is fully operational;
145. Furthermore, calls on the Commission and the European Schools to:
(i) implement without delay the Court’s recommendations in its Report on the accounts of the European Schools for the 2022 financial year, and to keep the discharge authority informed on the progress;
(ii) urgently resolve ongoing teacher shortages and ensure a stable and fair employment situation for all by retaining staff and reducing turnover, thereby also avoiding a brain drain; and
(iii) feature the financial contributions from the Union to the European Schools as a separate budget line, in future Union budgets, in order to increase transparency, ensure strategic planning and facilitate parliamentary scrutiny under the discharge procedure;
CHAPTER II - Recovery and Resilience Facility (RRF)
General remarks
146. Recalls that the outbreak of the COVID-19 pandemic in 2020 abruptly changed the economic and social outlook of the Union and led to a unified effort to launch the recovery package for Europe, consisting of the 2021-2027 MFF and NGEU, of which the cornerstone is the RRF; recalls that the objective of the RRF is to provide Member States with financial support to mitigate the serious economic and social impact of the COVID-19 pandemic and make European economies and societies more sustainable, resilient, inclusive and better prepared for the challenges and opportunities of the green and digital transitions; recalls that the RRF is an innovative, temporary instrument based on performance, which means that payments are linked to the satisfactory fulfilment of milestones and targets (M&Ts) reflecting progress on reforms and investments included in the national recovery and resilience plans (RRPs), which are set in a Council Implementation Decision;
147. Notes that all 27 RRPs were adopted by the end of 2022, allocating EUR 335,1 billion in grants and EUR 165,3 billion in loans, that will be paid out upon the fulfilment of 2 557 measures (consisting of approximately one third for reforms and two thirds for investments), and their related 6 237 milestones and targets, by 2026; notes that, in 2022, the Commission disbursed a total, including pre-financing, of EUR 74,4 billion (EUR 47,2 billion in grants and EUR 27,2 billion in loans);
148. Notes that the REPowerEU Plan was launched in May 2022 to help the Union to reduce its dependency on Russian fossil fuels by saving energy, producing clean energy and diversifying its energy supplies, which is aligned with the green transition; notes that the amendments introduced to Regulation (EU) 2021/241 (‘the RRF Regulation’) by Regulation (EU) 2023/435 on REPower EU added additional financing and priorities to the RRF; notes that all 27 Member States have submitted modified RRPs to include REPowerEU chapters, but also to request additional loan support, to make adjustments following the update of the maximum financial contribution or to make amendments due to objective circumstances, as enabled by the RRF Regulation; notes that the revision of the RRPs are subject to the same assessment criteria as the original plans, together with specific requirements applicable to the REPowerEU chapters;
149. Recalls that, under NGEU, the Commission can raise up to EUR 806,9 billion between mid-2021 and 2026 through the issuance of EU-bonds; notes that in June 2022, the Commission announced a funding plan for the period June to end-December 2022 and raised an additional EUR 50 billion in long-term funding for NGEU, complemented by short-term EU-bills issuances, bringing the total outstanding amount of NGEU bonds to EUR 171 billion, of which EUR 36,5 were raised by issuing green bonds;
150. Notes that, in 2020, an amount of EUR 14,9 billion was planned in the MFF 2021-2027 to cover the interest payments for NGEU non-repayable support; is concerned about the impact of the higher interest rates on the purchasing power of the Union budget, with the interest rates on 10-year EU-Bonds increasing from 0,09 % in 2021 to 3,2 % in 2023; notes the Commission’s statement that the Union will meet its obligations towards bondholders in all circumstances and its proposal for a technical modification to the MFF to optimise the budgetary treatment of NGEU borrowing costs;
Court’s observations
151. Welcomes that the RRF expenditure in 2022 is legal and regular in all material aspects, except for the effects of the quantitative findings in 11 payments and the material error in 6 payments estimated by the Court, which are the basis for its qualified opinion concerning the RRF expenditure; notes that the nature of the RRF spending model relies on the judgements to be made by the Commission and thus, the Court does not provide an error rate but estimates the minimum financial impact of its findings to be below, but close to the materiality threshold;
152. Notes that the Court audited 244 out of 274 milestones and all 37 targets included in 2022 payment requests for grants; notes that the Court considers that 15 of them were affected by regularity issues (below 5 % of the total); notes that the Court considers that the requirements had not been satisfactorily fulfilled for 8 M&Ts in 8 payments; notes that the Court’s conclusions are based on its interpretation of the legal requirements set by the Council or qualitative judgements different from the Commission; notes that all the RRF payments are assessed against the framework communicated and applied by the Commission, who also takes into consideration for each payment the opinion of the Economic and Financial Committee and the scrutiny by Member State experts under the comitology procedure;
153. Notes that the Court considers that a case of double funding occurred in 2022, even though the measure in question does not have any costs attached to it under the RRF; notes the Commission’s observation that, according to the RRF Regulation, ‘double funding’ is explicitly linked to costs and thus, there can be no 'double funding' if the Member State has not submitted any cost estimate as part of its national plan; notes that the Commission underlines that reforms are essential criteria for the Commission's positive assessment of RRPs, but that the inclusion of no-cost reforms does not increase their financial envelope, although in this way the plans ensure their effective and timely implementation;
154. Notes that the Court also identified several cases of weak design in M&Ts and problems with the reliability of information that Member States included in their management declarations, although the effects of those findings are considered material but not pervasive by the Court; notes that the Commission agrees to review M&Ts provided there is a legal justification to change the elements of a Council Implementing Decision, namely that a Member State submits an amended plan and a legal basis justifies the changes;
155. Notes that, by end 2022, the Commission reported 6 cases of potential irregularities to OLAF, identified during ex-post audits or from open sources in respect of RRF supported actions; notes that, in 2022, OLAF disseminated a risk framework for the RRF and provided over 50 fraud awareness-training sessions to Commission departments, agencies and other external partners, including Member States’ authorities;
156. Welcomes the systematic audit work of the Court regarding the RRF, with emphasis on the protection of the Union’s financial interests, which is providing a thorough analysis of the relevant aspects of the Facility and valuable insight into its implementation; notes with satisfaction that the Commission broadly accepts and applies the Court’s recommendations and acknowledges that many of the issues identified by the Court are related to the legal basis of the RRF and linked to its innovative nature and functioning; considers that the Court’s recommendations stemming from its audit work on the RRF are particularly relevant to the co-legislators for future Union performance-based financing instruments;
Audit and control
157 Notes that the control framework is tailored to the unique nature of the RRF and built upon two types of controls, namely (i) controls by the Commission to provide reasonable assurance over the legality and regularity of commitments and payments, based on the satisfactory achievement of M&Ts as set in the Council Implementing Decisions approving the RRPs, and (ii) controls by the Member States to ensure adequate protection of the financial interests of the Union as provided in Article 22 of the RRF Regulation;
158 Welcomes that, based on the Court’s recommendations and the experience gained, the Commission presented its methodologies on (i) assessing the satisfactory fulfilment of M&Ts, (ii) calculating the suspended amounts in case of non-fulfilment of a milestone or target, and (iii) dealing with potential situations where M&Ts initially assessed as satisfactorily fulfilled by the Commission were subsequently reversed by the Member State; welcomes that the Commission accepts the recommendation to carry out a revision of its ex-post audit procedures to verify the potential reversal of targets after the payment, although is concerned that the methodology does not provide legal clarity in case a milestone or target is reversed after the implementation period of the RRF;
159. Notes that the Commission verified the adequacy of the control systems of Member States as a precondition for the positive assessment of the RRPs and, in some cases, specific M&Ts on audit and control were added in the RRPs to ensure the full adequacy of the systems to protect the financial interests of the Union; notes that the satisfactory fulfilment of audit and control M&Ts was, in turn, a precondition for the first payments and welcomes that the Court did not raise any issues related to their satisfactory fulfilment assessed during 2022; notes that afterwards, the Commission performed 16 system audits in 2022 and 11 in 2023, so all Member States’ control systems will have been audited at least once by the end of 2023;
Implementation and impact
160. Notes that in 2022, the Commission made 13 payments to 11 Member States amounting to a total of EUR 72,2 billion, following the satisfactory fulfilment of 366 M&Ts (328 milestones and 38 targets); notes that as of the date of publication of the second implementation report in September 2023, the Commission has received 32 payment requests from 20 Member States and disbursed a total amount of EUR 153,4 billion (EUR 106,3 billion in grants and EUR 47,1 billion in loans);
161. Notes that the Commission reports that the achievement of M&Ts is broadly on track, after the first year of the RRF's functioning was more focused on the necessary reforms to build the framework for subsequent investment projects to have a higher impact; notes that the Commission reports delays compared to the indicative calendar of payments, due to the process of revising the RRPs in the context of the REPowerEU Plan and implementation challenges Member States are facing, such as administrative capacity issues, investment bottlenecks, and consequences of the Russian war of aggression against Ukraine, including the energy crisis, unexpected price shocks, shortages of certain materials and high inflation; notes that the Commission is supporting all Member States in accelerating the implementation and revision of their plans, including through the Technical Support Instrument; is concerned that according to the Commission’s RRF 2023 implementation report, 8 Member States have not yet submitted any payment request to the Commission;
162. Welcomes the RRF's crucial contribution to preventing a severe economic downturn and social crisis following the COVID-19 pandemic, and the fact that it enabled an unprecedented wave of reforms and investments across the Union that will have an important long-lasting effect on the Gross domestic product( GDP); points out that the European added value of the RRF has long been proven by the fact that its innovative and flexible nature allows Member States to achieve common Union policy objectives; notes that, at the same time, the RRF enables Member States to address country specific challenges through the design of the RRPs while a single assessment framework is applied equally for all Member States and payments requests;
163. Welcomes that reforms and investments proposed by the Member States in support of the green and digital transitions have exceeded the objectives set in the RRF Regulation, as the estimated climate expenditure amounts to about 40 % and the digital expenditure to 26 %, while the objectives were set at lower percentages of 37 % and 20 % respectively;
164. Notes the progress reported on the six pillars of the RRF and, in particular, on the implementation of country-specific recommendations (CSRs), with at least some progress having been made for 68 % and substantial progress in 12 % of 2019-2020 CSRs, which shows the incentives provided by the RRF; notes that progress in the implementation of the 2022 CSRs has also been substantial, with at least some progress in almost 52 % of the recommendations addressed to Member States in July 2022;
165. Notes from Special Report 26/2023 that, despite the little time available to design the performance model of the RRF, the Commission and Member States managed to set up a monitoring system, including an IT-system, that allows implementation progress to be measured; welcomes the Commission’s commitment to work on the identified issues and implement the related recommendations;
166. Welcomes the considerable progress shown by the common indicators and across all policy pillars by December 2022, such as 22 million Megawatt (‘MWh’) of savings in annual energy consumption achieved, 1,43 million enterprises helped either through monetary or in-kind support, 4 million people trained, and support provided to 4 115 196 young people aged 15-29 years;
Transparency
167. Notes that the Ombudsman acknowledges that progress has been made in pro-active transparency, specifically through the RRF Scoreboard and the publication of the 100 largest recipients; notes however the points for improvement indicated by the Ombudsman and supports its recommendations to ensure greater transparency and accountability with regard to the RRF;
168. Notes that, following an explicit demand of the Parliament, the amended RRF Regulation requires Member States to publish information on the 100 final recipients receiving the highest amount of funding under the RRF; notes that all Member States but one have published the required list on the RRF Scoreboard and observes a large variety of the size of the payments both across the Member States and within each country, which is explained by the heterogeneous nature of RRPs;
169. Welcomes the other initiatives undertaken by the Commission to increase transparency on the implementation of the RRF; notes that key documents governing the implementation, such as RRPs, Operational Arrangements, methodologies for assessment, and documents supporting or containing key decisions concerning Member States’ implementation are publicly available and easily accessible;
Recommendations
170. Supports the Court’s recommendations in its Annual Report as well as in related special reports, and welcomes that the Commission accepts a majority of them; calls on the Commission to implement them and to keep the discharge authority informed on the progress of the implementation;
171. Furthermore, calls on the Commission to:
(i) map different options to address the reversal of milestones after the end of the implementation period of the RRF and the relevant legal basis;
(ii) keep improving the clarity of the measures and the related M&Ts when the Member State submits a revision of the national plan;
(iii) address reported delays at an early stage by providing, inter alia, technical assistance to Member States;
(iv) keep working with the Court in order to bring the interpretation of M&Ts as close together as possible; and
(v) use the recommendations of the Court from its work on the RRF and the experience gained in the implementation for the design and implementation of future Union performance-based instruments when relevant;