The Committee on Budgetary Control adopted the report by Dan JØRGENSEN (PES, DK) recommending that the Parliament grant discharge to the Commission in respect of the implementation of the EU general budget for 2006 and to the directors of the “Education, Audiovisual and Culture” and “Intelligent Energy” Executive Agencies in respect of the implementation of their Agencies' budgets for 2006. The committee also recommended that Parliament should approve the closure of the accounts of the EU general budget for 2006, but pointed out that 80% of Community expenditure was administered by the Member States through “shared management” and that, as a result, each Member State must be in a position to take on the responsibility for the management of EU funds received, either through a single national management declaration or in the form of several declarations within a national framework.
In the resolution containing its observations accompanying the proposed discharge decision on the EU general budget for 2006, the parliamentary committee looked closely at the issues of shared management and responsibility, at all levels, for the implementation of the EU budget.
Main conclusions of the parliamentary committee: in favour of setting up a working group for the follow-up to the 2006 discharge: while MEPs welcome the progress made by the Commission towards a more efficient use of EU funds, particularly concerning the Common Agricultural Policy (CAP), thanks to the Integrated Administrative Control System (IACS), they believe that significant efforts remain to be made in several areas of expenditure through shared management: MEPs are referring to structural measures and external actions in particular, which still record a high incidence of error. To combat this control deficit, MEPs call for the setting up of a joint Parliament -Commission working group for the follow-up to the discharge in respect of the financial year 2006, covering national declarations and annual summaries, external actions and the implementation of the action plan to strengthen the Commission's supervisory role under shared management of Structural Actions. This working group should be co-chaired by the competent Member of the Commission and the President of the Committee on Budgetary Control.
National Management Declarations: MEPs welcome the Commission's commitment to give firm political support to national initiatives to draw up and publish national declarations, following the example of the Netherlands, the UK, Denmark and Sweden. Therefore, they expect the Commission to insert a new action point on promoting national management declarations as part of its review and follow-up to the action plan towards an integrated internal control framework. They recall the urgent need to introduce national declarations at an appropriate political level, covering all Community funds coming under the shared management arrangement, as requested by Parliament in its resolutions accompanying the discharge decision in respect of the financial years 2003, 2004 and 2005. The MEPs reject, in particular, the Commission’s decision not to proceed with the development of a single standard declaration for all Member States.
Structural Funds: MEPs also welcome the publication of the action plan to strengthen the Commission's supervisory role under shared management of structural actions, in reaction to the concerns raised by Parliament in the course of the discharge procedure for the financial year 2006. They will closely monitor the reporting on this action plan in preparation for the 2007 discharge. In particular, MEPs welcome the firm commitment made by the Commission to ensure that any undue payments are recovered in the remaining period before the closure of the winding-up procedures concerning the 2000 to 2006 period. They consider as a major achievement of the 2006 discharge procedure, the commitment made by the Commission to correct all individual errors found in the Court of Auditor’s Annual Report, and in particular the commitment to make 100% corrections in all cases of serious breaches of public procurement procedures and to apply flat rate or extrapolated financial corrections whenever it finds systemic tendering problems. MEPs fully support the fact that the Commission has finally committed itself to applying a policy of suspending payments as soon as possible, following detection of serious weaknesses in the system. In this context, MEPs look forward to the establishment of a system and a reporting scheme which would allow recoveries made ex post to be linked to the year when the actual funding was allocated.
External actions: MEPs welcome the fact that the Commission has become increasingly aware of the importance of transparency, visibility and political guidance for all EU funds implemented in the area of external actions, be it directly by the Commission or via international trust funds. In this context, MEPs call on the Commission to review, as soon as possible, the Financial and Administrative Framework Agreement between the European Community and the United Nations (FAFA) and to keep the Parliament informed of this agreement. Once again, they call on the Commission to submit the list of entities which were not subject to a tender procedure for contracts received in 2006 as well as a series of technical measures on how to improve the visibility of EU funds when implementing external aid via other organisations. Furthermore, they consider that the Commission must react to fulfil important requests made by the Parliament in its 2005 discharge procedure.
The issue of recoveries: MEPs consider that the Commission must present complete and reliable figures for recoveries, specifying the exact budget line and year to which the individual recoveries relate. They insist on public access to information on all members of experts and working groups working with the Commission, as well as full disclosure of beneficiaries of EU funding.
In addition to these general considerations, the parliamentary committee notes a certain number of horizontal issues on the DAS (Statement of Assurance of EU expenditure) and on the implementation of different budget headings for the financial year 2006.
Horizontal issues: while overall MEPs note with satisfaction the Court of Auditor’s positive opinion concerning the reliability of the final annual accounts for 2006, they deplore, nonetheless, the fact that in areas such as structural measures, internal policies and external actions, payments are still affected by high material errors at the level of implementing organisations. In particular, they regret the lack of clarity about legality, and the inevitable impact on the media, of EU funds being received by railway companies, horse riding/breeding clubs, golf leisure clubs and city councils.
MEPs note the significant efforts made by the Commission in terms of budgetary management but once again regret the financial drain caused by the RAL (outstanding commitments unused and carried over to be implemented in subsequent financial years), corresponding to 28% of the total amounts of the related financial perspective headings for the whole of the period 2000-2006.
In terms of governance, MEPs regret the Commission’s tacit acceptance of the collective irresponsibility of the majority of the Member States concerning financial management in the European Union and welcome the initiatives taken by some Member States to take on this responsibility in full by publishing the relevant accounts with complete transparency. They call on the other Member States to follow suit.
Sectoral issues: MEPs looked in detail at the implementation of the budget for each of the budget headings and came of with the following points: