MEPs debate Court of Auditors report

The majority of MEPs appear critical with error rate remaining above materiality threshold.

By Dods EU monitoring

14 Nov 2014

Please note that this does not constitute a formal record of the proceedings of the meeting. It is dependent on interpretation and acts as an unofficial summary of the debate.

Documents: ECA Report, EP Press release, Legislative observatory

Timetable:

  • Plenary vote on 2013 discharge procedure - April 2015

On November 12, the European Parliament hosted Mr da Silva Caldeira, President of the European Court of Auditors (ECA) in a plenary session in Brussels where he presented the ECA annual report on the implementation of the budget concerning the financial year 2013. The report was published on November 5th 2014 and its main element is that the overall error rate in 2013 was estimated to 4.7%, slightly down on 2012. Please find below a summary of the debate held in the plenary.

Vítor Manuel da Silva Caldeira, ECA President, acknowledged that the financial management of the EU is, overall, not yet good enough. Despite the high level of payments, the outstanding financial obligations rose, revealing the growing pressure on EU cash-flows. In this respect, he recommended that the Commission should prepare appropriate cash-flow forecast to anticipate potential funding shortages, as well as ensuring that upfront investment from the EU budget reflects real cash-flow needs.

Then, he referred to the estimated error rate which is by only 0.1% lower than last year and explained that the error is higher in areas of shared management with Member States, rather than under the Commission's direct management. Although corrective measures have been implemented, a lot more could be done to prevent errors in the first place, he stated.

He then referred to the issue of performance and explained that the past years the focus was on spending the available funds and complying with the rules, rather than achieving results. This needs to change, he said; and welcomed the Commission's initiative to move from a culture of spending to a culture of performance. To this end, a genuine commitment is needed, he believed. Then, well-targeted results, as well as incentives and sanctions are also required, he added.

Finally, he clarified that all three –spending, rule compliance and result-driven performance– are necessary.

Please find here the full speech of Mr da Silva Caldeira.

Kristalina Georgieva, Vice-President of the European Commission responsible for Budget and Human Resources, reiterated the importance and the positive contribution of ECA report and the recommendations it includes. Referring to the error rate, she highlighted the fact that the increasing trend has stopped and that Commission's own management rate is below the threshold of 2%. She also put emphasis on the need to continue at the same pace in the future.

Ms Georgieva then referred to the need to focus on shared policies, cohesion and agricultural policy in particular. She agreed with the fact that simplification of the rules is needed, as also recommended by the report. She also referred to the need to intensify efforts with the Member States.

Then, she wanted to remind the Parliamentarians that multiannual nature of EU's programming comes to contradiction with the annual nature of ECA reports. There are often corrections taking place that are not reflected in the report, she explained.

She then reiterated the basic principles of the new programming period: simplification, ownership and incentives.

Then, the Commissioner put special emphasis on the issue of performance. "This will be in the centre of my attention and my actions" she stated; and reassured that the proposed inter-institutional working group on performance will be set in the course of next weeks.

Finally, she concluded by making a fair commitment to establish proper cooperation with ECA, based on two key priorities: compliance and performance.

Ingeborg Grässle (EPP, DE) regretted that results have been put only third in the order of priority. She doubted that the situation will change from now on given that similar commitments have been set but not met in the past. She questioned the difference of figures provided by the Commission and ECA as regards to the Cohesion policy. Finally, she supported sanctions against States which provide false reporting.

Inés Ayala Sender (S&D, ES) highlighted the issue of increasingly limited budget and the payment problems. Even Juncker's programme of 300 000 million for investments encompasses a complex form of financial engineering which needs to be audited by ECA. Then, she referred to the issue of liability and the need for deepened auditing, while also supporting the shift to performance culture, rather than sanctions which create discouragement.

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