### (11) to protect citizens who are most vulnerable to the climate transition , the jtf should also cover the up-skilling and reskilling of the affected workers , with the aim of helping them to adapt to new employment opportunities , as well as providing job-search assistance to jobseekers and their active inclusion into the labour market. ### (11) to protect citizens who are most vulnerable to the climate transition , the jtf should also cover the up-skilling and reskilling of the affected workers , with the aim of helping them to adapt to new employment opportunities , as well as providing job-search assistance to jobseekers and their active inclusion into the labour market. similarly , special attention should be paid to unemployment rates , particularly for young people , in territories affected by the transition.


### (11) to protect citizens who are most vulnerable to the climate transition , the jtf should also cover the up-skilling and reskilling of the affected workers , with the aim of helping them to adapt to new employment opportunities , as well as providing job-search assistance to jobseekers and their active inclusion into the labour market. ### (11) to protect citizens who are most vulnerable to the climate transition , the jtf should also cover the up-skilling and reskilling of the affected workers and self-employed persons whose activity has affected as a result of significant structural changes , with the aim of helping them to adapt to new employment opportunities , as well as providing job-search assistance to jobseekers and their active inclusion into the labour market.


### (14) the jtf support should be conditional on the effective implementation of a transition process in a specific territory in order to achieve a climate-neutral economy. in that regard , member states should prepare , in cooperation with the relevant stakeholders and supported by the commission , territorial just transition plans , detailing the transition process , consistently with their national energy and climate plans. to this end , the commission should set up a just transition platform , which would build on the existing platform for coal regions in transition to enable bilateral and multilateral exchanges of experience on lessons learnt and best practices across all affected sectors. ### (14) the jtf support should be conditional on the effective implementation of a transition process in a specific territory in order to achieve a climate-neutral economy. in that regard , member states should prepare , in cooperation with the relevant stakeholders and supported by the commission , territorial just transition plans , detailing the transition process , consistently with their national energy and climate plans. to this end , the commission should set up a just transition platform , which would build on the existing platform for coal regions in transition to enable bilateral and multilateral exchanges of experience on lessons learnt and best practices to assess the capacities of these regions to complete this transition and the challenges this will present to them.


### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission. ### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories , such as unemployment rates and any job losses , and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal , such as the design of sustainable mobility plans and accessible and affordable green energy plans for the inhabitants of affected territories. similarly , territorial plans should reflect the particular challenges that the transition to climate neutrality will present for remote , island and geographically disadvantaged areas , and for areas with depopulation problems. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission.


### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission. ### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a fully renewables-based , highly resource and energy-efficient climate-neutral and circular economy aimed at achieving net zero ghg emissions by 2040 , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges , the opportunities and needs of those territories , including the green , permanent and quality job creation potential required to achieve a socially just transition which leaves no one behind , and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to renewables-based , highly resource and energy-efficient climate-neutral and circular economy aimed at achieving net zero ghg emissions by 2040 and the objectives of the green deal. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission.


### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission. ### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories , such as unemployment levels and possible job losses , and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal. similarly , territorial plans should reflect the particular challenges that the transition to climate neutrality will present for remote , island and geographically disadvantaged areas , and for areas with depopulation problems. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission.


### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission. ### (15) the territorial just transition plans should identify the territories most negatively affected , where jtf support should be concentrated and describe specific actions to be undertaken to reach a climate-neutral economy , notably as regards the conversion or closure of facilities involving fossil fuel production or other greenhouse gas intensive activities. those territories should be precisely defined and correspond to nuts level 3 regions or should be parts thereof. the plans should detail the challenges and needs of those territories and identify the type of operations needed in a manner that ensures the coherent development of climate-resilient economic activities that are also consistent with the transition to climate-neutrality and the objectives of the green deal. the plans should detail synergies and complementarities with other union programmes and pillars of the just transition mechanism and , where relevant , the modernisation fund to address identified development needs. only investments in accordance with the transition plans should receive financial support from the jtf. the territorial just transition plans should be part of the programmes (supported by the erdf , the esf+ , the cohesion fund or the jtf , as the case may be) which are approved by the commission.


### 1. this regulation establishes the just transition fund (‘jtf’) to provide support to territories facing serious socio-economic challenges deriving from the transition process towards a climate-neutral economy of the union by 2050. ### 1. this regulation establishes the just transition fund (‘jtf’) to provide support to the people and territories facing serious socio-economic , energy security and environmental challenges deriving from the transition process towards a climate-neutral economy of the union by 2050.


### in accordance with the second subparagraph of article [4(1)] of regulation (eu) [new cpr] , the jtf shall contribute to the single specific objective ‘enabling regions and people to address the social , economic and environmental impacts of the transition towards a climate-neutral economy’. ### in accordance with the second subparagraph of article [4(1)] of regulation (eu) [new cpr] , the jtf shall contribute to the single specific objective ‘enabling regions and people to address the social , economic and environmental impacts of the transition towards a climate-neutral economy’. jtf funding is necessary for the continued narrowing of regional disparities and for european social cohesion.


### 3. the commission shall adopt a decision by means of an implementing act setting out the annual breakdown of resources , including any additional resources referred to in paragraph 2 , by member state in accordance with the methodology set out in annex i. ### 3. the commission is empowered to adopt delegated acts in accordance with article 10 to set out the annual breakdown of resources , including any additional resources referred to in paragraph 2 , by member state in accordance with the methodology set out in annex i.


### investments in the deployment of technology and infrastructures for affordable clean energy , in greenhouse gas emission reduction , energy efficiency and renewable energy; ### investments in the deployment of technology and infrastructures for affordable clean energy , in greenhouse gas emission reduction , including investments in sustainable transport and infrastructure , inter alia fostering electrification and the use of biofuels in order to phasing out fossil fuels , ensuring energy efficiency and the use of renewable energy;


### investments in the deployment of technology and infrastructures for affordable clean energy , in greenhouse gas emission reduction , energy efficiency and renewable energy; ### investments in the deployment of technology and infrastructures for affordable clean energy , in greenhouse gas emission reduction , including the development of sustainable mobility services , energy efficiency and renewable energy;


### investments in digitalisation and digital connectivity; ### investments in digitalisation and digital connectivity , including investments in broadband infrastructure , particularly in insular , remote and sparsely populated areas , in order to enabling teleworking and reducing emissions;


### upskilling and reskilling of workers; ### upskilling and reskilling of workers and self-employed persons;


### active inclusion of jobseekers; ### active inclusion of jobseekers , including income support for transitioning workers and mobility grants for workers who need to move for a new job


### the jtf resources shall be programmed for the categories of regions where the territories concerned are located , on the basis of the territorial just transition plans established in accordance with article 7 and approved by the commission as part of a programme or a programme amendment. the resources programmed shall take the form of one or more specific programmes or of one or more priorities within a programme. ### the jtf resources shall be programmed for the categories of regions where the territories concerned are located , on the basis of the territorial just transition plans established in accordance with article 7 and approved by the commission as part of a programme or a programme amendment. the resources programmed shall take the form of one or more priorities within a programme supported by the european regional development fund (‘erdf’) , the european social fund plus(‘esf+’) or the cohesion fund , or one or more specific programmes where objective circumstances justify such a course of action. the programming of jtf resources shall be in accordance with article 6 of regulation (eu) [new cpr] and ensure the direct involvement of authorities of targeted territories at nuts2 or nuts3 level , via the allocation of resources through regional programmes , where such programmes are in place , or the exploitation of integrated territorial tools set out under articles 22 to 28 of regulation (eu) [new cpr].


### the jtf resources shall be programmed for the categories of regions where the territories concerned are located , on the basis of the territorial just transition plans established in accordance with article 7 and approved by the commission as part of a programme or a programme amendment. the resources programmed shall take the form of one or more specific programmes or of one or more priorities within a programme. ### the jtf resources shall be programmed for the categories of regions where the territories concerned are located , on the basis of the territorial just transition plans established in accordance with article 7 and approved by the commission as part of a programme or a programme amendment. the resources programmed shall take the form of one or more specific programmes or of one or more priorities within a programme. the programming of jtf resources shall be in accordance with article 6 of regulation (eu) [new cpr] and ensure the direct involvement of authorities of targeted territories at nuts2 or nuts3 level , via the allocation of resources through regional programmes , where such programmes are in place , or the exploitation of integrated territorial tools set out under articles 22 to 28 of regulation (eu) [new cpr].


### the jtf resources shall be programmed for the categories of regions where the territories concerned are located , on the basis of the territorial just transition plans established in accordance with article 7 and approved by the commission as part of a programme or a programme amendment. the resources programmed shall take the form of one or more specific programmes or of one or more priorities within a programme. ### the jtf resources shall be programmed for the categories of regions where the territories concerned are located , on the basis of the territorial just transition plans established in accordance with article 7 and approved by the commission as part of a programme or a programme amendment , except for modifications regarding pillars 2 or 3 of the just transition mechanism. the resources programmed shall take the form of one or more specific programmes or of one or more priorities within a programme.


### 1. member states shall prepare , together with the relevant authorities of the territories concerned , one or more territorial just transition plans covering one or more affected territories corresponding to level 3 of the common classification of territorial units for statistics (‘nuts level 3 regions’) as established by regulation (ec) no 1059/2003 of the european parliament and of the council as amended by commission regulation (ec) no 868/201417or parts thereof , in accordance with the template set out in annex ii. those territories shall be those most negatively affected based on the economic and social impacts resulting from the transition , in particular with regard to expected job losses in fossil fuel production and use and the transformation needs of the production processes of industrial facilities with the highest greenhouse gas intensity. ### 1. member states shall prepare , together with the relevant regional , local or other authorities of the territories concerned , one or more territorial just transition plans covering one or more affected territories corresponding to level 3 of the common classification of territorial units for statistics (‘nuts level 3 regions’) as established by regulation (ec) no 1059/2003 of the european parliament and of the council as amended by commission regulation (ec) no 868/201417 or parts thereof , in accordance with the template set out in annex ii. those territories shall be those most negatively affected based on the economic and social and territorial cohesion impacts resulting from the transition , in particular with regard to expected job losses in fossil fuel production and use and the transformation needs of the production processes of industrial facilities with the highest greenhouse gas intensity. similarly , territorial plans should take account of the unemployment rate , particularly for young people , in the affected territories , along with other demographic challenges , such as depopulation.


### an assessment of the transition challenges faced by the most negatively affected territories , including the social , economic , and environmental impact of the transition to a climate-neutral economy , identifying the potential number of affected jobs and job losses , the development needs and objectives , to be reached by 2030 linked to the transformation or closure of greenhouse gas-intensive activities in those territories; ### an assessment of the transition challenges faced by the most negatively affected territories , including the social , economic , and environmental impact of the transition to a climate-neutral economy , identifying the potential number of affected businesses and jobs and the number of job losses , the development needs and objectives , to be reached by 2030 linked to the transformation or closure of greenhouse gas-intensive activities , and ways to help undertakings brought to a halt by this transition to re-profile or redirect their business activities in those territories;


### an assessment of the transition challenges faced by the most negatively affected territories , including the social , economic , and environmental impact of the transition to a climate-neutral economy , identifying the potential number of affected jobs and job losses , the development needs and objectives , to be reached by 2030 linked to the transformation or closure of greenhouse gas-intensive activities in those territories; ### an assessment of the transition challenges faced by the most negatively affected territories , including the social , economic , and environmental impact of the transition to a climate-neutral economy , taking unemployment rates into account and identifying the potential number of affected jobs and job losses , population density , the development and territorial cohesion needs and objectives , to be reached by 2030 linked to the transformation or closure of greenhouse gas-intensive activities in those territories;


### a description of the expected contribution of the jtf support to addressing the social , economic and environmental impacts of the transition to a climate-neutral economy; ### a description of the expected contribution of the jtf support to addressing the social , economic and environmental impacts of the transition to a climate-neutral economy , along with the design of sustainable mobility and green energy plans that are accessible and affordable in the territories most affected by the transition;


### (1) the regulatory framework governing the union’s cohesion policy for the period from 2021 to 2027 , in the context of the next multi-annual financial framework , contributes to the fulfilment of the union’s commitments to implement the paris agreement and the united nations sustainable development goals by concentrating union funding on green objectives. this regulation implements one of the priorities set out in the communication on the european green deal (‘the european green deal’)11 and is part of the sustainable europe investment plan12 providing dedicated financing under the just transition mechanism in the context of cohesion policy to address the economic and social costs of the transition to a climate-neutral and circular economy , where any remaining greenhouse gas emissions are compensated by equivalent absorptions. ### (1) the regulatory framework governing the union’s cohesion policy for the period from 2021 to 2027 , in the context of the next multi-annual financial framework , contributes to the fulfilment of the union’s commitments to implement the paris agreement and the united nations sustainable development goals by concentrating union funding on green objectives as well as the european pillar of social rights. this regulation implements one of the priorities set out in the communication on the european green deal (‘the european green deal’)11 and is part of the sustainable europe investment plan12 providing dedicated financing under the just transition mechanism in the context of cohesion policy to address the economic and social costs of the transition to a climate-neutral and circular economy , where any remaining greenhouse gas emissions are compensated by equivalent absorptions.


### (1) the regulatory framework governing the union’s cohesion policy for the period from 2021 to 2027 , in the context of the next multi-annual financial framework , contributes to the fulfilment of the union’s commitments to implement the paris agreement and the united nations sustainable development goals by concentrating union funding on green objectives. this regulation implements one of the priorities set out in the communication on the european green deal (‘the european green deal’)11 and is part of the sustainable europe investment plan12 providing dedicated financing under the just transition mechanism in the context of cohesion policy to address the economic and social costs of the transition to a climate-neutral and circular economy , where any remaining greenhouse gas emissions are compensated by equivalent absorptions. ### (1) the regulatory framework governing the union’s cohesion policy for the period from 2021 to 2027 , in the context of the next multi-annual financial framework , contributes to the fulfilment of the union’s commitments to implement the paris agreement , the european pillar of social rights and the united nations sustainable development goals by concentrating union funding on green objectives , while at the same time not undermining the social and economic sustainability in the eu. this regulation implements one of the priorities set out in the communication on the european green deal (‘the european green deal’)11 and is part of the sustainable europe investment plan12 providing dedicated financing under the just transition mechanism in the context of cohesion policy to address the economic and social challenges of the transition to a climate-neutral and circular economy , where any remaining greenhouse gas emissions are compensated by equivalent absorptions.


### (1) the regulatory framework governing the union’s cohesion policy for the period from 2021 to 2027 , in the context of the next multi-annual financial framework , contributes to the fulfilment of the union’s commitments to implement the paris agreement and the united nations sustainable development goals by concentrating union funding on green objectives. this regulation implements one of the priorities set out in the communication on the european green deal (‘the european green deal’)11 and is part of the sustainable europe investment plan12 providing dedicated financing under the just transition mechanism in the context of cohesion policy to address the economic and social costs of the transition to a climate-neutral and circular economy , where any remaining greenhouse gas emissions are compensated by equivalent absorptions. ### (1) the regulatory framework governing the union’s cohesion policy for the period from 2021 to 2027 , in the context of the next multi-annual financial framework , contributes to the fulfilment of the union’s commitments to implement the paris agreement and the united nations sustainable development goals by concentrating union funding on green objectives and the objectives of the european pillar of social rights. this regulation implements one of the priorities set out in the communication on the european green deal (‘the european green deal’)11 and is part of the sustainable europe investment plan12 providing dedicated financing under the just transition mechanism in the context of cohesion policy to address the economic and social costs of the transition to a climate-neutral and circular economy , where any remaining greenhouse gas emissions are compensated by equivalent absorptions.


### 1. the jtf shall only support activities that are directly linked to its specific objective as set out in article 2 and which contribute to the implementation of the territorial just transition plans established in accordance with article 7. ### 1. the jtf shall only support activities that are directly linked to its specific objective as set out in article 2 and which contribute to the implementation of sustainable territorial just transition plans established in accordance with article 7.


### 1.1. outline of the expected transition process towards a climate-neutral economy , in line with the objectives of the national energy and climate plans and other existing transition plans with a timeline for ceasing or scaling down activities such as coal and lignite mining or coal fired electricity production ### 1.1. outline of the expected transition process towards a climate-neutral economy , in line with the objectives of the national energy and climate plans and other existing transition plans with a timeline for ceasing all high ghg emission activities such as activities related to fossil-fuel based electricity production


### to fill in only if support is provided to investments to achieve the reduction of greenhouse gas emissions from activities listed in annex i to directive 2003/87/ec: ### deleted


### - synergies and complementarities of the envisaged operations with other programmes under the invesments for jobs and growth goal (supporting the transition process) other financing instruments (the union emissions trading modernisation fund) and the other pillars of the just transition mechanism (dedicated scheme under investeu and public sector loan facility with the european investment bank) to address identified investment needs ### - synergies and complementarities of the envisaged operations with other programmes under the invesments for jobs and growth goal (supporting the transition process) and the other pillars of the just transition mechanism (dedicated scheme under investeu and public sector loan facility with the european investment bank) to address identified investment needs


### - arrangements for involvement of partners in the preparation , implementation , monitoring and evaluation of the territorial just transition plan ### - arrangements for involvement of partners in the preparation , implementation , monitoring and evaluation of the territorial just transition plan including which civil society organisations will be involved and how community representatives are consulted and engaged in the programming process , before and after programming documents are developed;


### budgetary and financial management ### deleted


### 1. notes that , as indicated in the annual report of the court of auditors for the financial year 2018 , the estimated level of error in spending on ‘economic , social and territorial cohesion’ increased from 3 % in 2017 to 5 % in 2018; regrets that , even if it should be stressed that errors in the implementation of the budget do not automatically imply a fraud , the positive trend of the last years has been reversed; ### 1. stresses the importance of simplifying the rules and procedures and making them more flexible , avoiding unnecessary administrative obstacles , so as to prevent or detect and correct many of the errors and improve take-up capacity in the member states;


### 1. notes that , as indicated in the annual report of the court of auditors for the financial year 2018 , the estimated level of error in spending on ‘economic , social and territorial cohesion’ increased from 3 % in 2017 to 5 % in 2018; regrets that , even if it should be stressed that errors in the implementation of the budget do not automatically imply a fraud , the positive trend of the last years has been reversed; ### 1. notes that , as indicated in the annual report of the court of auditors for the financial year 2018 , the estimated level of error in spending on ‘economic , social and territorial cohesion’ increased from 3 % in 2017 to 5 % in 2018; regrets that the positive trend of the last years has been reversed;


### 1. calls on the integration of women’s rights and gender equality into all policy areas; reiterates therefore its call for the implementation of gender budgeting in the budgetary process , including the implementation of the budget and assessment of its implementation; ### 1. stresses that women's rights and gender equality should be integrated and ensured into all policy areas ; reiterates therefore its call for the implementation of gender budgeting in the budgetary process , including the implementation of the budget and assessment of its implementation;


### 1. highlights that whenever the member states implement the union’s budget , and whatever method of implementation they use , respect for the rule of law is an essential precondition for complying with the principles of sound financial management , which is enshrined in article 317 of the treaty on the functioning of the european union (tfeu); ### 1. highlights that whenever the member states implement the union’s budget , and whatever method of implementation they use , respect for the rule of law is an essential precondition for complying with the principles of sound financial management , which is enshrined in article 317 of the treaty on the functioning of the european union (tfeu); is concerned about the financial loss caused by generalised deficiencies as regards the rule of law in a number of member states and upholds that the union should be able to impose appropriate measures that include suspending , reducing and restricting access to union's funding in such cases; welcomes the therefore the proposal for a regulation on the protection of the union’s budget in the case of generalised deficiencies as regards the rule of law in member states and calls to adopt this proposal with priority;


### 1. highlights that whenever the member states implement the union’s budget , and whatever method of implementation they use , respect for the rule of law is an essential precondition for complying with the principles of sound financial management , which is enshrined in article 317 of the treaty on the functioning of the european union (tfeu); ### 1. highlights that whenever the commission in cooperation with the member states implements the union’s budget , and whatever method of implementation is used - shared , direct or indirect management , respect for the rule of law is an essential precondition for complying with the principles of sound financial management , which is enshrined in article 317 of the treaty on the functioning of the european union (tfeu);


### 1. welcomes the findings of the court of auditors concerning the financial year 2018; takes note of its remarks regarding the regularity of transactions under ‘natural resources’; highlights that transactions under the eagf were free from material errors and that most of the other errors were generated by complex eligibility rules; notes , furthermore , that the risk implied by errors is adequately covered under the corrective capacity of the commission; ### 1. welcomes the findings of the court of auditors concerning the financial year 2018; takes note of its remarks regarding the regularity of transactions , in which 77 % of the transaction examined were error free with an overall error rate for ‘natural resources’ of 2 ,4 %; highlights that direct payments under the eagf were free from material errors and that most of the other errors were generated by complex eligibility rules; notes , furthermore , that the risk implied by errors is adequately covered under the corrective capacity of the commission;


### 3. welcomes that in 2018 , for the first time , audit authorities reported errors using a common methodology agreed between the commission and the member states; notes the fact that there has been a sustained improvement in the overall estimated level of error in expenditures made from the union budget in the past few years (4.4 % in 2014; 3.8 % in 2015; 3.1 % in 2016; 2.4 % in 2017 and 2.6 % in 2018); ### 3. welcomes that in 2018 , for the first time , audit authorities reported errors using a common methodology agreed between the commission and the member states and that ineligible expenditure and public procurement procedures have been detected as the most common types of irregularities; notes the fact that there has been a sustained improvement in the overall estimated level of error in expenditures made from the union budget in the past few years (4.4 % in 2014; 3.8 % in 2015; 3.1 % in 2016;2.4 % in 2017 and 2.6 % in 2018);


### 3. draws attention to the fact that high-risk expenditures are often subject to complex rules and eligibility conditions which lead to errors and that a number of these errors are compounded by a supplemental layer added by national authorities; recalls that simpler national eligibility rules might help reduce this source of error and result in a smaller administrative burden for beneficiaries; ### 3. draws attention to the fact that high-risk expenditures are often subject to complex rules and eligibility conditions which lead to errors and that a number of these errors are compounded by a supplemental layer added by national authorities; stresses that simpler national eligibility rules might help reduce this source of error , undoubtedly resulting in a smaller administrative burden for beneficiaries; regrets the difficulties encountered by certain member states and regions regarding deployment of the funds owing to excessively strict and inflexible regulations;


### 3. reiterates its call to have a separate budget line for the daphne specific objective of rec; it takes note of the evolution of the development of an eu-wide survey , with a common methodology and questionnaire , to gather comparable gender-based violence data , on a regular basis , across eu member states; it expects to acknowledge the first outcomes of the pilot exercise of the survey by 2019 in order to comply with the foreseen implementation of the survey from 2020-2021 onwards1 ; ### 3. reiterates its call to have a separate budget line for the daphne specific objective of rec and to reverse the decrease of funds dedicated to daphne during the 2014-2020 period ; it takes note of the evolution of the development of an eu-wide survey , with a common methodology and questionnaire , to gather comparable gender-based violence data , on a regular basis , across eu member states; it expects to acknowledge the first outcomes of the pilot exercise of the survey by 2019 in order to comply with the foreseen implementation of the survey from 2020-2021 onwards1 ;


### 3. welcomes the intention of the court of auditors (the “court”) to move towards an attestation methodology by which the auditor gathers sufficient and appropriate evidence to provide a conclusion on assurance expressed by the responsible entity; recalls the finding of the court that the quality and reliability of national authorities needs to be improved; ### 3. welcomes the intention of the court of auditors (the “court”) to move towards an attestation methodology by which the auditor gathers sufficient and appropriate evidence to provide a conclusion on assurance expressed by the responsible entity; recalls the finding of the court that the quality and reliability of national authorities needs to be improved; calls on the court to complement its random checks with a risk based approach so that its reports on error rates will have more attention to areas where problems are most likely to arise;


### 3. welcomes the intention of the court of auditors (the “court”) to move towards an attestation methodology by which the auditor gathers sufficient and appropriate evidence to provide a conclusion on assurance expressed by the responsible entity; recalls the finding of the court that the quality and reliability of national authorities needs to be improved; ### 3. welcomes the intention of the court of auditors (the “court”) to move towards an attestation methodology by which the court gathers sufficient and appropriate evidence to provide a conclusion on assurance expressed by the responsible entity; recalls the finding of the court that the quality and reliability of national authorities needs to be improved;


### 3. is satisfied with the overall execution rate of the budget; ### 3. is satisfied with the overall execution rate of the budget (96 ,92 % for commitment appropriations and 97 ,21 % for payments appropriations); welcomes the fact that dg agri’s findings on error rate is consistent with the conclusion of the court of auditors , however asks the commission and member states to improve its execution rate for rural development (93 ,97 % in 2018) and to do its utmost to facilitate the absorption of the eafrd;


### 4. notes that the european court of auditors (eca) found a significant increase in payment claims for the european structural and investment funds (esi funds) which include the european social fund , by member states in 2018; notes at the same time , that for those funds absorption had continued to be slower than planned - a phenomenon that had contributed to increasing esi funds outstanding commitments; ### 4. notes that the european court of auditors (eca) found a significant increase in payment claims for the european structural and investment funds (esi funds) which include the european social fund , by the member states in 2018 mainly because of the relatively low level of esi fund payment claims in the early years of the 2014-2020 programmes; notes at the same time , that for those funds absorption had continued to be slower than planned - a phenomenon that had contributed to increasing esi funds outstanding commitments; calls on the commission to analyse the reasons for the low absorption level and to simplify the new rules for the post-2020 period in order to avoid unnecessarily complex and/or burdensome rules that do not add value to the eu policies;


### 4. welcomes the 11 000 placements offered to young people by the european solidarity corps programme; regrets , however , the lack of data on the number of placements in the occupational strand of the programme; ### 4. welcomes the 11 000 placements offered to young people by the european solidarity corps programme; regrets , however , the lack of data on the number of placements in the occupational strand of the programme; notes that by december 2018 more than 93 000 young persons had registered to take part in the programme but only 11 000 have had the opportunity to engage in solidarity activities; calls therefore for the appropriate funding to ensure full coverage of demand , particularly in the volunteering strand;


### 4. stresses that the absorption of european structural and investment funds (‘esi funds’) has continued to be slower than planned - by the end of 2018 , only 27 ,3% - notes that this value is even lower than the absorption rate of 2011 , the corresponding year of the previous multiannual financial framework; ### 4. stresses that the absorption of european structural and investment funds (‘esi funds’) has continued to be slower than planned - by the end of 2018 , only 27 ,3%; notes that this value is even lower than the absorption rate of 2011 , the corresponding year of the previous multiannual financial framework; points out that simplification of the rules could increase the take-up of esi funds;


### 4. highlights the need to make a greater effort in the integration of the gender perspective in the fields of research and integration; in this sense it welcomes the fact that , up to january 2019 the share of women participants in horizon 2020 projects was 42% of the total workforce; by contrast , it regrets the fact that women only represented 28 % of projects coordinators and only 32.4 % of grants took into account the gender dimension in the research and innovation content2 ; ### 4. highlights the need to make a greater effort in the integration of the gender perspective in the fields of research and integration; in this sense it welcomes the fact that , up to january 2019 the share of women participants in horizon 2020 projects was 42% of the total workforce; by contrast , it regrets the fact that women only represented 28 % of projects coordinators and only 32.4 % of grants took into account the gender dimension in the research and innovation content2 ;also calls for the inclusion of targeted actions on women's rights and gender equality with specific budget lines in order to take into account the gender dimension within migration and asylum policies ;


### 4. welcomes the eca's analytical review on european defence and supports its recommendations; calls on the commission as guardian of the treaties to ensure the coherence of all union defence efforts carried out for the implementation of a union activity under the csdp (pesco , edidp , edf , card etc.) and to ensure synergies with nato; considers that a competitive european defence technological and industrial base , enhancing member states’ military capabilities and framing a european defence union must be the key objectives of the union under the next mff; ### 4. welcomes the eca's analytical review on european defence and supports its recommendations; calls on the commission as guardian of the treaties to ensure the coherence of all union defence efforts carried out for the implementation of a union activity under the csdp (pesco , edidp , edf , card etc.) and to ensure synergies with nato where necessary; considers that a competitive european defence technological and industrial base , enhancing member states’ military capabilities and framing a european defence union must be one of the key objectives of the union under the next mff;


### 4. welcomes the use of budget support in general to assist developing countries in their reform efforts and in achieving the sdgs , urges , however , the commission to more clearly assess and define the development outcomes to be achieved through budget support in each case and above all to enhance control mechanisms concerning recipient states' conduct in the fields of corruption , respect of human rights , rule of law and democracy. ### 4. welcomes the use of budget support in general to assist developing countries in their reform efforts and in achieving the sdgs; urges , however , the commission to more clearly assess the contribution of the union budget support towards the achievement of the sdgs , in particular as regards sdg 10 (reduced inequality) , and to enhance control mechanisms concerning recipient states' conduct in the fields of corruption , respect of human rights , rule of law and democracy.


### 5. notes with concern the increase of the estimated level of error in the policy area ‘economic , social and territorial cohesion’ at 5.0 % , which is largely above the 2 % materiality threshold; ### 5. stresses the importance of the eu cohesion policy in supporting the implementation of the european pillar of social rights and in assisting the member states and regions to harness new and persistent challenges , such as globalisation , unemployment , industrial change , digitalisation and reskilling of people; notes with concern the increase of the estimated level of error in the policy area ‘economic , social and territorial cohesion' at 5.0 % , which is largely above the 2 % materiality threshold; stresses that the new control and assurance framework was designed to ensure that annual residual error rates are below 2 %; agrees with the court's conclusions that further improvements are necessary , in particular in terms of the implementation of the framework by managing authorities , audit authorities and the commission to reduce the high level of error;


### 5. recalls that the reasons behind this low absorption rate not only lie in the decommitment methodology (the so-called “n+3 rule”) , but also in the late adoption of the legislative framework enabling the implementation of the cohesion policy; therefore calls on the commission and the council to ensure proper measures in the next programming period 2021-2027 to avoid the repetition of delayed implementation of esi funds and its domino effect. ### 5. recalls that the reasons behind this low absorption rate not only lie in the decommitment methodology (the so-called “n+3 rule”) , but also in the late adoption of the legislative framework enabling the implementation of the cohesion policy; therefore calls on the commission and the council to ensure proper measures in the next programming period 2021-2027 to avoid the repetition of delayed implementation of esi funds and its domino effect and to present the action plan on reducing the payments backlog during the 2021-2027 multiannual financial framework;


### 5. calls for the collection of data disaggregated by gender on beneficiaries and participants of eu funded programmes. ### 5. calls for the collection of data disaggregated by gender on beneficiaries and participants of eu funded programmes; reiterates its demand to include in the common set of result indicators for the implementation of the union budget also gender-specific indicators , , with due regards to the principle of sound financial management , namely in accordance with the principles of economy , efficiency and effectiveness ;


### 5. is concerned by alleged cases of high-level conflicts of interest and land-grabbing by oligarchs with possible facilitation by governments and public authorities; calls on the commission to increase efforts to prevent and detect fraud; urges the commission to be extra vigilant on rule of law matters; ### 5. is concerned by alleged cases of high-level conflicts of interest and land-grabbing by oligarchs with possible facilitation by governments and public authorities; calls on the commission to increase efforts to prevent and detect fraud; calls on the commission to differentiate land-grabbing from land accumulation , which , due to historical land ownership patterns or reorganisation in some member states , resulted in the need of small farmers to assemble a number of plots to create economically productive units to ensure viability; urges the commission to be extra vigilant on rule of law matters;


### 5. is concerned by alleged cases of high-level conflicts of interest and land-grabbing by oligarchs with possible facilitation by governments and public authorities; calls on the commission to increase efforts to prevent and detect fraud; urges the commission to be extra vigilant on rule of law matters; ### 5. is concerned by alleged cases of high-level conflicts of interest and land-grabbing by oligarchs with possible facilitation by governments and public authorities; calls on the commission to increase efforts to prevent and detect fraud;


### 6. highlights that increased flexibility of member states in allocating cap subsidies risks further aggravating abuses , and urges therefore the commission to avoid renationalisation of the cap; ### 6. highlights that the proper implementation of the cap interventions is strictly related to the beneficiaries’ compliance with the commitments set out at union level; stresses that the increased flexibility of member states in allocating cap subsidies risks further aggravating abuses , and urges therefore the commission to avoid renationalisation of the cap;


### 8. stresses , this year again , the need to take effective measures to reduce those sources of error while achieving a high performance and urges the commission to implement swiftly the eca’s recommendations in this policy area; ### 8. stresses , this year again , the need to take effective measures to reduce those sources of error while achieving a high performance and urges the commission to implement swiftly the eca’s recommendations in this policy area and in particular invites the commission to better implement appropriate control measures aimed to ensure that no programme can be closed with a material level or irregular expenditure and that regular checks are carried out at the level of financial intermediaries by an audit authority;


### 11. notes with concern that , due to limitations in its monitoring , fead’s contribution to reducing poverty has not been established , and deplores in particular that the commission does not have data which demonstrates the relative importance of fead in overall support to deprived people in the union; ### 11. supports the fead which aims to alleviate the worst forms of poverty in the eu such as food deprivation , homelessness , and child poverty; highlights that the results of the 2018 mid-term evaluation show that the fund has a notable effect in nearly each member state and that the supported food , material aid , and social inclusion measures make a difference to the most deprived , including those who may be otherwise left out by mainstream social assistance or who need immediate support; notes that the evaluation identified several weaknesses in the implementation of the fund and that the court of auditors suggested to better target the fund to the ones most in need and that the commission has to improve the collected data to better demonstrate the relative importance of fead in overall support to deprived people in the union;


### 13. notes that in accordance with union law , the beneficiaries entitled to cap direct payment are those who farm the land; calls on the commission to table a proposal modifying the cap rules with a view to avoiding that union funds be given if such land has been taken by force as it has been observed in some member states; ### 13. notes that in accordance with union law , the beneficiaries entitled to cap direct payment are those who farm the land; calls on the commission to table a proposal modifying the cap rules with a view to avoiding that union funds be given if such land has been taken by force as it has been observed in some member states; asks the commission in cooperation with national agencies to come up with a standardized and publicly accessible format to disclose the end beneficiaries of the cap , building on best practices such as the website farmsubidy.org;


### 13. notes that in accordance with union law , the beneficiaries entitled to cap direct payment are those who farm the land; calls on the commission to table a proposal modifying the cap rules with a view to avoiding that union funds be given if such land has been taken by force as it has been observed in some member states; ### 13. notes that in accordance with union law , the beneficiaries entitled to cap direct payment are those who farm the land; calls on the commission to table a proposal modifying the cap rules with a view to avoiding that union funds be given if the acquisition of agriculture land is based on illegal and fraudulent methods as it has been observed in some member states;


### 2. notes with concern that payment claims for a substantial value have been delayed and will be submitted in future years and that this has affected the use of pre-financing and outstanding commitments , and will affect payment appropriation needs at the start of the next mff; ### 2. notes with concern that payment claims for a substantial value have been delayed and will be submitted in future years and that this has affected the use of pre-financing and outstanding commitments , and will affect payment appropriation needs at the start of the next mff; acknowledges that the european commission is taking measures to avoid undue pressure on the level of payment appropriations in the first years of the 2021-2027 mff;


### 2. is worried that european court of auditors concluded that beneficiaries of union funding under erasmus+ were in some cases obliged to follow national rules that were not fully in line with union principles; stresses that the commission should closely monitor the coherence of implementation measures throughout all member states; ### 2. is worried that european court of auditors concluded that beneficiaries of union funding under erasmus+ were in some cases obliged to follow national rules that were not fully in line with union principles; stresses that the commission should ensure the coherence of implementation measures throughout all member states;


### 2. takes note that the source of those errors is mainly a result of reimbursements of ineligible costs , infringements of internal market rules and lack of support documentation , but is also due to the previous year’s overall low rates of reimbursement and payments as well as fewer financial instruments having been included in the audit; ### 2. takes note that the source of those errors is mainly a result of reimbursements of ineligible costs , infringements of internal market rules and lack of support documentation , but is also due to the previous year’s overall low rates of reimbursement and payments as well as fewer financial instruments having been included in the audit; notes , as indicated in the annual report of the court of auditors for 2018 , that vat reimbursement is prone to error and does not always result in to optimal use of union funds;


### 2. points to the eca special report no 35/2018 (“transparency of eu funds implemented by ngos: more effort needed”) , which finds that transparency is often lacking regarding the implementation of union funds by non-governmental organisations (ngos) , particularly when funds are sub-contracted by un bodies; calls on the commission to improve its systems for tracing the use of funds implemented by ngos and ensure and verify the correct application of rules and procedures , in line with the eca’s recommendations; ### 2. takes note of the eca special report no 35/2018 (“transparency of eu funds implemented by ngos: more effort needed”); highlights that the eca found that in the area of external action the commission’s selection of non-governmental organisation (ngo) - led projects is generally transparent and that the commission generally reported data on humanitarian and development assistance in accordance with international transparency standards; notes , however , that transparency is often lacking , regarding the implementation of union funds by ngos , particularly when funds are sub-contracted by un bodies; notes , furthermore , that the current regulatory framework does not impose any additional transparency requirements for ngos compared to other beneficiaries; calls on the commission to continue improving its systems for tracing the use of funds implemented by ngos and ensure and verify the correct application of rules and procedures , in line with the eca’s recommendations , enabling also an assessment of the costs declared by all implementing actors; welcomes , in this context , the launch , in march 2019 , of the eu aid explorer , a public website that shows all published data on external assistance from the eu institutions and member states;


### 2. notes that most rural development actions which were audited produced the expected results; asks the commission and member states to improve their performance framework where needed and to introduce further simplification measures , such as simplified cost options; regrets that the court of auditors identified weaknesses in the use of result indicators; ### 2. notes that most rural development actions which were audited produced the expected results; asks the commission and member states to improve their performance framework where needed and to introduce further simplification measures , such as simplified cost options; regrets that the court of auditors identified weaknesses in the use of result indicators; however notes as well that the commission has taken steps that should address those weaknesses in its proposal for the future cap;


### 14. notes with satisfaction that the estimated error level in the area of ‘competitiveness for growth and jobs’ is 2.0 % - which represents a substantial decrease compared to 2017 (4.2 %) and 2016 (4.1 %) and notes that most of the errors were related to the research spending while errors on other spending are limited; ### 14. notes with satisfaction that the estimated error level in the area of ‘competitiveness for growth and jobs’ is 2.0 % - which represents a substantial decrease compared to 2017 (4.2 %) and 2016 (4.1 %) and notes that most of the errors were related to the research spending while errors on other spending are limited; acknowledges the commission’s efforts to improve the level of error , which is lower than in the last two years and reiterates the importance of the spending programmes in the competitiveness’ chapter , which play an important role in fostering an inclusive society , stimulating growth and creating employment in the eu;


### 15. notes that , according to the commission , the easi mid-term evaluation showed that its objectives are still relevant and that the programme is effective in reaching the relevant stakeholders , generating outcomes and achieving its objectives; also notes that , even though the three axes (progress , eures and microfinance and social entrepreneurship) seem to operate independently , some areas which could result in increased effectiveness (‘synergies’) have been identified; ### 15. notes that , according to the commission , the easi mid-term evaluation showed that its objectives are still relevant and that the programme is effective in reaching the relevant stakeholders , generating good-quality outcomes and achieving its objectives in particular in light of the current challenging socio-economic context characterised by the aftermath of the financial and economic crisis; also notes that , even though the three axes (progress , eures and microfinance and social entrepreneurship) seem to operate independently , some areas which could result in increased effectiveness (‘synergies’) have been identified;


### 16. notes that the commission completed in 2018 the first cross-cutting evaluation of the european commission agencies working in the employment and social affairs policy field (eurofound , cedefop , etf and eu-osha) to complement the founding regulation revision of the three tripartite agencies; notes with satisfaction that the assessment confirms the relevance , effectiveness , efficiency , coherence and added value of the agencies , as well as the need to reinforce cooperation in order to exploit synergies; ### 16. welcomes that the commission completed in 2018 the first cross-cutting evaluation of the european commission agencies working in the employment and social affairs policy field (eurofound , cedefop , etf and eu-osha) to complement the founding regulation revision of the three tripartite agencies; notes with satisfaction that the assessment confirms a very positive evaluation report on the relevance , effectiveness , efficiency , coherence and added value of the agencies , as well as the need to reinforce cooperation in order to exploit synergies;


### 17. highlights that the increasing use of financial mechanisms to deliver union policies in third countries alongside the union budget risks undermining the level of accountability and transparency of union action; insists that the commission ensures that the delivery of external aid is subject to the rule of law and respect for human rights in recipients countries; stresses , in particular , the need to guarantee that no union funds support forced child labour; ### 17. highlights that the increasing use of financial mechanisms to deliver union policies in third countries alongside the union budget risks undermining the level of accountability and transparency of union action; insists that the commission ensures that the delivery of external aid is subject to the rule of law and respect for human rights in recipients countries; stresses , in particular , the need to guarantee that no union funds support forced child labour and that no union funds are used to finance textbooks and educational material which incite religious radicalisation , intolerance , ethnic violence and martyrdom among children; ;


### 17. highlights that the increasing use of financial mechanisms to deliver union policies in third countries alongside the union budget risks undermining the level of accountability and transparency of union action; insists that the commission ensures that the delivery of external aid is subject to the rule of law and respect for human rights in recipients countries; stresses , in particular , the need to guarantee that no union funds support forced child labour; ### 17. highlights that the increasing use of financial instruments and trust funds to deliver union policies in third countries alongside the union budget risks undermining the level of accountability and transparency of union action; insists that the commission ensures that the delivery of external aid is subject to the rule of law and respect for human rights in recipient countries; stresses , in particular , the need to guarantee that no union funds support forced child labour;


### 19. points to the challenges identified by dg sante in its aar in the implementation of the union’s third health programme 2014-2020 (the ‘health programme’); notes that those challenges relate to the current funding mechanism of the health programme , which only allows for project-oriented funding and can have a negative impact on the longer-term sustainability of the actions undertaken , and to the complexity of some mechanisms in the health programme , such as joint actions implemented with member states , which implies that timelines from the initial planning of the activity to its actual launch can be lengthy; ### 19. points to the challenges identified by dg sante in its aar in the implementation of the union’s third health programme 2014-2020 (the ‘health programme’); notes that those challenges relate to the current funding mechanism of the health programme , which only allows for project-oriented funding and can have a negative impact on the longer-term sustainability of the actions undertaken , and to the complexity of some mechanisms in the health programme , such as joint actions implemented with member states , which implies that timelines from the initial planning of the activity to its actual launch can be lengthy; notes the conclusions of the european court of auditors in special report no 21/2019 on antimicrobial resistance (amr) , according to which the activities of the commission and agencies have led to some progress , for example in veterinary and food-related issues; regrets , however , that according to the same report there is little evidence to date that the health burden of amr has been reduced in the union;


### 23. notes that where payments are made on the basis of cost reimbursements , the court estimates the rate of error at 4 ,5 % (compared to 3 ,7 % in 2017 and 4 ,8 % in 2016) whilst the rate of error of entitlement payments85 was below the materiality threshold of 2 % excluding some rural development schemes; ### 23. notes that where payments are made on the basis of cost reimbursements , the court estimates the rate of error at 4 ,5 % (compared to 3 ,7 % in 2017 and 4 ,8 % in 2016) whilst the rate of error of entitlement payments85 was below the materiality threshold of 2 % excluding some rural development schemes;


### 27. points out that the court did not estimate levels of error for areas of expenditure , under mff headings 3 security and citizenship and 4 global europe; notes , further , that the court did not issue specific error rates regarding rural development and market operations in cap , neither for the european social fund , the european regional and development fund and the cohesion funds; suggests that the court consider revising its sampling strategy in order to ensure a better comparability from one year to another; ### 27. points out that for 2018 the court did not estimate levels of error for areas of expenditure , under mff headings 3 security and citizenship and 4 global europe; notes , further , that the court presented error rate per policy area and it did not issue specific error rates regarding rural development and market operations in cap , neither individual error rates for the european social fund , the european regional development fund and the cohesion fund; suggests that the court consider revising its sampling strategy in order to ensure a better comparability from one year to another;


### 29. is surprised that the court decided that natural resources should make up the largest share of the court’s overall audit population for its das examination whilst the cap direct payments are not prone to errors; ### 29. is surprised that the court decided that natural resources should make up the largest share of the court’s overall audit population for its das examination whilst the cap direct payments are not prone to errors; notes , however , that in the area of direct payments several cases of conflict of interests and corruption have been made public and been followed by audits of the commission; calls more adequate measure to be taken by the commission and the member states to prevent and resolve cases which put at risk the cap;


### 52. points out that when comparing the 40 reservations for 2018 to the 38 for 2017 , 38 reservations are recurrent whilst the amount at risk at reporting for the 2017 expenditure under reservations is estimated at eur 1 078 billion (eur 1 053 in 2017 , eur 1 ,6 billion in 2016 and eur 1 ,3 billion in 2015) ; ### 52. points out that 40 reservations were issued by the commission for 2018: 2 reservations were new and 38 were recurrent; notes that five recurrent reservations have been updated , from quantified to unquantified (or vice versa) or for a change of scope and that for all reservations , the impact on 2018 expenditure was calculated or recalculated; notes therefore that the amount at risk at reporting for the 2018 expenditure under reservations is estimated at eur 1 078 million (eur 1 053 million in 2017 , eur 1 621 million in 2016 and eur 1 324 million in 2015);


### 78. calls on the commission to present annually to the budgetary authority the overall amount and the breakdown of funds transferred from the union budget for financial instruments managed by the eib group; ### 78. calls on the commission to present annually to the budgetary authority the overall amount and the breakdown of funds transferred from the union budget for financial instruments managed by the eib group , as well as to present information on the level of implementation of these funds;


### 100. notes with concern that the court found in spain weaknesses in the control systems for compiling the monthly statements of customs duties; ### 100. notes with concern that the court found , within a random sample of three countries , weaknesses in the control systems for compiling the monthly statements of customs duties in one of the selected countries;


### 101. notes with concern that in france , italy and spain the court detected weaknesses in the management of established duties not yet collected; notes that these weaknesses mainly concerned delays in enforcing recovery of customs debts and the late recording or writing off of debts in the accounting system; notes weaknesses in the commission’s verifications of the member states’ tor statements; ### 101. notes with concern that , in the random sample of three counties selected , the court detected weaknesses in the management of established duties not yet collected; notes that these weaknesses mainly concerned delays in enforcing recovery of customs debts and the late recording or writing off of debts in the accounting system; notes weaknesses in the commission’s verifications of the member states’ tor statements;


### 152. notes that the multi-annual financial framework (mff) subheading 1b “economic , social and territorial cohesion ” accounts for 34 ,8 % or eur 54 ,5 billion of the union budget; of this amount eur 30 ,1 billion (55 ,1 %) are spent on the european regional development fund (erdf) , eur 9.3 billion (17 %) on the cohesion fund (cf) , eur 13.9 billion (25 ,6 %) on the european social fund (esf) and the rest on other actions; ### 152. notes the information presented by the court that in 2018 payments under multi-annual financial framework (mff)subheading 1b “economic , social and territorial cohesion ” are 34 ,8 % or eur 54 ,5 billion of the annual union budget; notes further that of this amount eur 30 ,1 billion (55 ,1 %) are spent on the european regional development fund(erdf) , eur 9.3 billion (17 %) on the cohesion fund (cf) , eur 13.9 billion(25 ,6 %) on the european social fund (esf) and the rest on other actions;


### 153. has been informed that , in 2018 , dg regio paid eur 39.5 billion; ### 153. notes that for 2018 dg regio reported payment of eur 39.5 billion which represents 98 ,52% implementation rate of the authorised payment appropriations for 2018 , and that dg empl reported payment of eur 14 ,6 billion - 94 ,42%implementation rate;


### 155. remarks nevertheless that little is known about the sustainability94 and quality of those investments and to what degree positive economic developments are fostered by a general economic upturn or by union funding; ### 155. remarks that the common provisions regulation for2014-2020 period (regulation 1303/2013 , article 71) does not include provisions which define the achievement of results and their sustainability as criteria for durability of productive investments from the european regional development fund; notes the court's observations about the sustainability94and quality of those investments and reiterates its call for inclusion of the achievement of results as a core consideration in evaluating project durability which will allow to assess to what degree positive economic developments are fostered by a general economic upturn or by union funding;


### 164. is astounded by the marked difference between the audit findings of the court and the commission; ### 164. notes with concern the marked difference between the error rates estimated by the court and by the commission


### 169. is concerned by the court’s judgement that it can , currently , neither rely on the work of member states’ management authorities , nor on work done by audit authorities due to weaknesses in the audit authorities sampling method , its audit trail documentation and treatment of errors and that the court could not therefore rely on the commission’s error rate; ### 169. is concerned by the court’s conclusion that currently there is limited reliance on the work done by several audit authorities due to weaknesses in the audit authorities sampling method , its audit trail documentation and treatment of errors; expresses also concern that the court cannot rely on the error rate presented by the commission because it is based on expenditure which has not yet gone through the full control cycle and which expenditure is not the same as this audited by the court;


### 173. welcomes that 99 % of the action plans to fulfil the ex-ante conditionalities have finally been completed; ### 173. notes that at the end of 2018 dg regio reports for a completion of 99 % of the action plans to fulfil the ex-ante conditionalities and that the uncompleted action plans were reduced to 6 in 2018 (8 in 2017; notes with concern that two suspension decisions and two pre-suspension letters were issued for those plans not completed which creates delays and puts at risk the timely implementation of the operational programmes concern majority of which are in the environmental sector;


### 175. notes that eur 18 billion of erdf and cf , which is equivalent to 7 ,2% of the total allocations , are planned to be delivered through financial instruments; ### 175. notes that the dg regio aar for 2018 states that currently eur 18 billion of erdf and cf , which is equivalent to 7 ,2% of the total allocations , are planned to be delivered through financial instruments;


### 176. is surprised that the annual report 2018 on the “financial instruments under the esi funds” has not yet been published; ### 176. observes that the annual report 2018 on the “financial instruments under the esi funds” - situation as at 31 december 2019 informs that at the end of 2018 the esif contributions committed to fis were eur 16 ,9 billion , eur 7 billion were paid to fis from esif (around 41%) and eur 3 ,7 billion were invested in final beneficiaries;


### - adapt its audit methodology as far as possible to the court’s audit methodology; ### - continue its cooperation with the court in order to further align audit methodologies and interpretation of legal texts;


### - publish all its proposals for country-specific recommendations under the european semester exercise in its aar; ### - publish all its proposals for country-specific recommendations under the european semester exercise;


### - pay particular attention to member states , whose management and control systems are only partially reliable; ### - pay particular attention to member states , whose management and control systems are only partially reliable and provide them with the necessary guidance;


### - reduce the programming period 2021 to 2027 from n+3 to n+2 to offer member states an additional incentive to swiftly implement the programmes; ### - reduce the automatic decommitment for the programming period 2021 to 2027 from n+3 years to n+2 years in order to push member states to swiftly implement the programmes;


### - impose financial corrections for the errors identified by the court; ### - impose financial corrections for the errors identified by the court in accordance with the relevant legal provisions;


### - specify in the aars how ex-post financial corrections imposed by member states and by the commission were reused; ### - report in the aars how the recovered amounts from ex-post financial corrections imposed by member states and by the commission were reused;


### - publish the 2018 annual report on the “financial instruments under the esi funds” without delay; ### deleted


### 202. regrets that national authorities made little use of simplified cost options though they could have been useful in about one third of the projects visited by the court; ### 202. regrets that national authorities made little use of simplified cost options though they could have been useful in about one third of the projects visited by the court; notes , however , the efforts of dg agri to assist member states to overcome difficulties and problems they encounter in introducing simplified cost options;


### 217. calls on the commission to ensure that the cap is fairly allocated to active farmers and do not result in land deals that benefit a select group of political insiders often called the oligarchs; ### 217. calls on the commission to ensure that the cap is fairly allocated to active farmers and do not result in land deals that benefit a select group of political insiders often called the oligarchs; calls on the commission to take stock of breaches , circumventions and unintended consequences of the cap current allocation rules;


### 232. calls on the commission to table a modification of the cap rules with a view to avoiding that union funds be given where the land has been taken by force; ### 232. calls on the commission to table a modification of the cap rules with a view to avoiding that union funds be given where the land has been taken by force or acquired based on illegal and fraudulent methods;


### 256. insists that an important criterion for the commissions prioritising of the external aid should be the presence of rule of law and the respect of human rights in the recipient country; ### 256. insists that an important criterion for the commissions prioritising of the external aid should be the presence of rule of law and the respect of human rights in the recipient country; insist that the commission should thoroughly verify the use of union funds by third entities to ensure that no funds are allocated or linked to any cause or form of terrorism and/or religious and political radicalisation;


### 259. stresses that the court identified five major problems hampering transparency: ### 259. stresses that the court identified five elements in the implementation of union funds by ngos in which the commission is not sufficiently transparent:


### - the unreliability of the classification of ngos in the commission’s accounting system abac; ### - the classification of ngos in the commission’s accounting system abac;


### - the lack of transparency in the selection of ngos to implement a programme; ### - the recording of information on funds and activities implemented by ngos;


### - the lack of adequate information provided to the commission on funds and activities implemented by ngos; ### - the commission's collection and check of the information on union funds implemented by ngos;


### - the lack of reliability of the information disclosed on actual payments or about entities receiving funding through sub-granting; ### - weaknesses of the information disclosed on actual payments or about entities receiving funding through sub-granting;


### - the inadequacy of the information provided by united nations bodies on the contracts awarded to ngos. ### - the incomplete information provided by united nations bodies on the contracts awarded to ngos.


### 261. observes that there are different registration systems for each dg to register union funds applicants; calls on the commission to create a single entry point , in which the ngo field would be mandatory; asks the commission to make the proper verifications of the ngo status of the applicants; ### 261. observes that there are different registration systems for each dg to register union funds applicants; calls on the commission to create a single entry point so as to ensure consistency of the data in the financial transparency system and to give criteria and guidelines for the definition of ngos and other categories of beneficiaries;


### 262. calls on the commission to exclude ngos applicants that present wrongful declarations of previous experience errors and to check them more thoroughly; ### deleted


### 263. requests the commission to ensure that the same sub-granting procedures is used and systematically applied by its services; ### 263. welcomes the new financial regulations efforts on simplification , such as the introduction of the ex ante pillar assessment and requests the european commission to apply a consistent interpretation of the applicable rules of the financial regulation notably as regards sub-granting among the different services , taking into account sectorial specificities;


### 264. asks the commission to provide information on actual payments or entities receiving funding through sub-granting in in its financial transparency system; ### 264. asks the commission to standardise and improve the accuracy of information published in the financial transparency system making sure that all beneficiaries contracted by the union are disclosed together with the amount of funding awarded by mid 2021;


### 266. asks the commission , for indirectly managed funds , to do the necessary to obtain the appropriate information from the entrusted entities and from the sub-granted ngos , to be able to control the proper use of these funds and the compliance with the budgetary principles; ### 266. asks the commission to improve the information collected by enabling the various grant management systems to record the funding received by all beneficiaries contracted by the union , not only the lead beneficiary , making this information usable for analysis and treatment and welcomes in this context the upcoming launch of the opsys within external eu funding;


### - reinforce the management of the national asylum systems; ### - strengthen the administrative capacity and staff within the national asylum systems;


### 312. calls for simplification wherever possible , for example through the greater use of lump sums as an option for beneficiaries and greater acceptance of usual accounting practices , as well as through the implemen tation of a single audit approach; stresses that the majority of union subsidies should benefit the citizens and that smes and farms should benefit the most; stresses that errors made in the current programming period 2014 to 2020 need to be improved in the new mff , especially in the area of regional development and cohesion; ### 312. calls for simplification wherever possible , for example through the greater use of simplified cost options and lumpsums as an option for beneficiaries and greater acceptance of usual accounting practices , as well as through the implementation of a single audit approach; stresses that the majority of union subsidies should benefit the citizens and that smes and farms should benefit the most; stresses that errors made in the current programming period 2014 to 2020 need to be improved in the new mff , especially in the area of regional development and cohesion;


### 324. insists that all funds that are committed must be used and spent in the most suitable way in order to maximise impact; ### 324. insists that all funds that are committed must be used and spent in the most suitable way according to the principle of sound financial management in order to maximise impact;


### 325. supports the idea of linking the union budget more strongly to the country-specific recommendations outlined under the economic governance principles with the objective of encouraging growth-enhancing structural reforms in member states; stresses that the recommendations must follow the principle of subsidiarity and focus on the essential , systemic issues such as improving competitiveness , strengthening the social and economic business requirements , cultural diversity , and securing jobs. ### 325. supports the idea of linking the union budget more strongly to the country-specific recommendations outlined under the economic governance principles with the objective of encouraging growth-enhancing structural reforms in member states; stresses that the recommendations must follow the principle of subsidiarity and focus on the essential , systemic issues such as improving competitiveness , strengthening the social and economic cohesion , business opportunities , cultural diversity , combating poverty and social exclusion , and securing jobs.


### 7. stresses that support to young farmers from the cap is essential; encourages the commission to move towards a greener cap in line with the paris agreement. ### 7. stresses that support to young farmers from the cap is essential; underlines that digitalisation of agriculture can be an adequate tool for the revitalisation of rural services making rural areas more attractive to young farmers.


### 22. observes that in 2018 , the court published a special report on the union regulation for the modernisation of air traffic management; notes that in its special report the court assessed how well the commission managed the deployment of sesar since 2011 , whether the union intervention targeted the projects in greatest need of support , and whether it added value to the management of air traffic in the union; ### 22. observes that in 2019 , the court published special report 11/2019 on the union regulation for the modernisation of air traffic management; notes that in its special report the court assessed how well the commission managed the deployment of sesar since 2011 , whether the union intervention targeted the projects in greatest need of support , and whether it added value to the management of air traffic in the union; notes the need for effective management of air traffic in the future so as to ensure safety and efficiency;


### 18. notes the extension of the joint undertaking's bilateral contacts with a number of member states and regions based on the research and innovation strategies for smart specialisation (ris3) priorities mapping drawn up by the joint undertaking , which indicates over 60 regions having indicated aeronautics or correlated areas to the joint undertaking scope among their r&i priorities; furthermore , notes with satisfaction that a further memorandum of understanding (mou) was signed in 2018 with a region in germany , which brought the number of mous in force by 31 december 2018 to 17; notes that this may be followed by the signature of a few more cooperation agreements in 2019. ### 18. notes the extension of the joint undertaking's bilateral contacts with a number of member states and regions based on the research and innovation strategies for smart specialisation (ris3) priorities mapping drawn up by the joint undertaking , which indicates over 60 regions having indicated aeronautics or correlated areas to the joint undertaking scope among their r&i priorities; furthermore , notes with satisfaction that a further memorandum of understanding (mou) was signed in 2018 with a region in germany , which brought the number of mous in force by 31 december 2018 to 17; notes that this was followed by the signing of a memorandum of understanding with the french region of nouvelle aquitaine in june 2019;


### 12. notes that the joint undertaking should contribute to addressing the challenges faced by the rail sector focusing on the needs of the rail system and of its users , including in member states that do not have a railway system within their territory; observes that in order to do that , the joint undertaking is implementing the shift2rail programme , and research and innovation activities in the railway sector in europe , through the collaboration between stakeholders and member states; ### 12. notes that the joint undertaking should contribute to addressing the challenges faced by the rail sector focusing on the needs of the rail system and of its users , including in member states that do not have a railway system within their territory; observes that in order to do that , the joint undertaking is implementing the shift2rail programme , and research and innovation activities in the railway sector in europe , through the collaboration between stakeholders and member states; notes that particular attention should be given to promote concrete measures for the removal of remaining technical obstacles to enhance interoperability , as well as to actions supporting a more integrated , efficient and safe eu railway market , with the ultimate aim of achieving the single european railway area;


### (47) the regulated entities falling within the scope of the emissions trading in the sectors of buildings and road transport should be subject to similar greenhouse gas emissions permit requirements as the operators of stationary installations. it is necessary to establish rules on permit applications , conditions for permit issuance , content , and review , and any changes related to the regulated entity. in order for the new system to start in an orderly manner , member states should ensure that regulated entities falling within the scope of the new emissions trading have a valid permit as of the start of the system in 2025. ### deleted


### (47) the regulated entities falling within the scope of the emissions trading in the sectors of buildings and road transport should be subject to similar greenhouse gas emissions permit requirements as the operators of stationary installations. it is necessary to establish rules on permit applications , conditions for permit issuance , content , and review , and any changes related to the regulated entity. in order for the new system to start in an orderly manner , member states should ensure that regulated entities falling within the scope of the new emissions trading have a valid permit as of the start of the system in 2025. ### (47) the regulated entities falling within the scope of the emissions trading in the sectors of buildings and road transport should be subject to similar greenhouse gas emissions permit requirements as the operators of stationary installations. it is necessary to establish rules on permit applications , conditions for permit issuance , content , and review , and any changes related to the regulated entity. in order for the new system to start in an orderly manner , member states should ensure that regulated entities falling within the scope of the new emissions trading have a valid permit as of the start of the system in 2024.


### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target , taking into account the cost-efficient contribution of buildings and road transport of 43 % emission reductions by 2030 compared to 2005. the total quantity of allowances should be established for the first time in 2026 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030. ### deleted


### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target , taking into account the cost-efficient contribution of buildings and road transport of 43 % emission reductions by 2030 compared to 2005. the total quantity of allowances should be established for the first time in 2026 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030. ### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target , taking into account the cost-efficient contribution of buildings and road transport of 43 % emission reductions by 2030 compared to 2005. the total quantity of allowances should be established for the first time in 2024 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018.the commission should determine what share of that total quantity of allowances is to be used by commercial actors and base the cap from 2025 to 2027 only on emissions by commercial actors. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for both commercial and non-commercial end use for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030.


### (49) the auctioning of allowances is the simplest and the most economically efficient method for allocating emission allowances , which also avoids windfall profits. both the buildings and road transport sectors are under relatively small or non-existent competitive pressure from outside the union and are not exposed to a risk of carbon leakage. therefore , allowances for buildings and road transport should only be allocated via auctioning without there being any free allocation. ### deleted