# L_2014266EN.01014701.xml

| 5.9.2014 | EN | Official Journal of the European Union | L 266/147 |
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5.9.2014

EN

Official Journal of the European Union

L 266/147

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RESOLUTION OF THE EUROPEAN PARLIAMENT

of 3 April 2014

with observations forming an integral part of its Decision on discharge in respect of the implementation of the budget for the eighth, ninth and tenth European Development Funds for the financial year 2012

THE EUROPEAN PARLIAMENT,

| — | having regard to the Commission’s report on the follow-up to the discharge for the 2011 financial year (COM(2013) 668) and to the Commission staff working documents accompanying that report (SWD(2013) 348 and SWD(2013) 349), |
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—

having regard to the Commission’s report on the follow-up to the discharge for the 2011 financial year (COM(2013) 668) and to the Commission staff working documents accompanying that report (SWD(2013) 348 and SWD(2013) 349),

| — | having regard to the financial statements and revenue and expenditure accounts for the eighth, ninth and 10th European Development Funds for the financial year 2012 (COM(2013) 541 – C7-0283/2013), |
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—

having regard to the financial statements and revenue and expenditure accounts for the eighth, ninth and 10th European Development Funds for the financial year 2012 (COM(2013) 541 – C7-0283/2013),

| — | having regard to the Commission’s Annual Report of 29 April 2013 on the financial management of the eighth, ninth and 10th European Development Funds (EDFs) in 2012, |
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—

having regard to the Commission’s Annual Report of 29 April 2013 on the financial management of the eighth, ninth and 10th European Development Funds (EDFs) in 2012,

| — | having regard to the financial information on the European Development Funds (COM(2013) 346), |
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—

having regard to the financial information on the European Development Funds (COM(2013) 346),

| — | having regard to the Court of Auditors’ annual report on the activities funded by the eighth, ninth and 10th European Development Funds concerning the financial year 2012, together with the Commission’s replies (1) and to the Court of Auditors’ special reports, |
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—

having regard to the Court of Auditors’ annual report on the activities funded by the eighth, ninth and 10th European Development Funds concerning the financial year 2012, together with the Commission’s replies (1) and to the Court of Auditors’ special reports,

1

| — | having regard to the statement of assurance (2) as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors for the Financial year 2012 pursuant to Article 287 of the Treaty on the Functioning of the European Union, |
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—

having regard to the statement of assurance (2) as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors for the Financial year 2012 pursuant to Article 287 of the Treaty on the Functioning of the European Union,

2

| — | having regard to the Council’s recommendations of 18 February 2014 concerning the discharge to be given to the Commission in respect of the implementation of the operations of the European Development Funds for the financial year 2012 (05748/2014 – C7-0050/2014, 05750/2014 – C7-0051/2014, 05753/2014 – C7-0052/2014), |
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—

having regard to the Council’s recommendations of 18 February 2014 concerning the discharge to be given to the Commission in respect of the implementation of the operations of the European Development Funds for the financial year 2012 (05748/2014 – C7-0050/2014, 05750/2014 – C7-0051/2014, 05753/2014 – C7-0052/2014),

| — | having regard to the Partnership Agreement between the members of the African, Caribbean and Pacific Group of States, of the one part, and the European Community and its Member States, of the other part, signed in Cotonou on 23 June 2000 (3), as revised in Ouagadougou, Burkina Faso, on 22 June 2010 (4), |
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—

having regard to the Partnership Agreement between the members of the African, Caribbean and Pacific Group of States, of the one part, and the European Community and its Member States, of the other part, signed in Cotonou on 23 June 2000 (3), as revised in Ouagadougou, Burkina Faso, on 22 June 2010 (4),

3

4

| — | having regard to Council Decision 2001/822/EC of 27 November 2001 on the association of the overseas countries and territories with the European Community (‘Overseas Association Decision’) (5), |
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—

having regard to Council Decision 2001/822/EC of 27 November 2001 on the association of the overseas countries and territories with the European Community (‘Overseas Association Decision’) (5),

5

| — | having regard to Article 33 of the Internal Agreement of 20 December 1995, between the representatives of the governments of the Member States, meeting within the Council, on the financing and administration of the Community aid under the Second Financial Protocol to the fourth ACP-EC Convention (6), |
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—

having regard to Article 33 of the Internal Agreement of 20 December 1995, between the representatives of the governments of the Member States, meeting within the Council, on the financing and administration of the Community aid under the Second Financial Protocol to the fourth ACP-EC Convention (6),

6

| — | having regard to Article 32 of the Internal Agreement of 18 September 2000, between Representatives of the Governments of the Member States, meeting within the Council, on the financing and administration of Community aid under the Financial Protocol to the Partnership Agreement between the African, Caribbean and Pacific States and the European Community and its Member States signed in Cotonou (Benin) on 23 June 2000, and the allocation of financial assistance for the Overseas Countries and Territories to which Part Four of the EC Treaty applies (7), |
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—

having regard to Article 32 of the Internal Agreement of 18 September 2000, between Representatives of the Governments of the Member States, meeting within the Council, on the financing and administration of Community aid under the Financial Protocol to the Partnership Agreement between the African, Caribbean and Pacific States and the European Community and its Member States signed in Cotonou (Benin) on 23 June 2000, and the allocation of financial assistance for the Overseas Countries and Territories to which Part Four of the EC Treaty applies (7),

7

| — | having regard to Article 319 of the Treaty on the Functioning of the European Union, |
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—

having regard to Article 319 of the Treaty on the Functioning of the European Union,

| — | having regard to Article 74 of the Financial Regulation of 16 June 1998 applicable to development finance cooperation under the fourth ACP-EC Convention (8), |
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—

having regard to Article 74 of the Financial Regulation of 16 June 1998 applicable to development finance cooperation under the fourth ACP-EC Convention (8),

8

| — | having regard to Article 119 of the Financial Regulation of 27 March 2003 applicable to the 9th European Development Fund (9), |
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—

having regard to Article 119 of the Financial Regulation of 27 March 2003 applicable to the 9th European Development Fund (9),

9

| — | having regard to Article 142 of Council Regulation (EC) No 215/2008 of 18 February 2008 on the Financial Regulation applicable to the 10th European Development Fund (10), |
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—

having regard to Article 142 of Council Regulation (EC) No 215/2008 of 18 February 2008 on the Financial Regulation applicable to the 10th European Development Fund (10),

10

| — | having regard to the Commission’s proposal for a Council regulation on the Financial regulation applicable to the 11th European Development Fund (COM(2013) 660), |
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—

having regard to the Commission’s proposal for a Council regulation on the Financial regulation applicable to the 11th European Development Fund (COM(2013) 660),

| — | having regard to the Commission’s Communications of 13 October 2011 entitled ‘Increasing the impact of EU development cooperation – an Agenda for Change’ and ‘The Future Approach to EU Budget Support to Third Countries’, |
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—

having regard to the Commission’s Communications of 13 October 2011 entitled ‘Increasing the impact of EU development cooperation – an Agenda for Change’ and ‘The Future Approach to EU Budget Support to Third Countries’,

| — | having regard to its previous discharge decisions and resolutions, |
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—

having regard to its previous discharge decisions and resolutions,

| — | having regard to Rules 76 and 77, third indent of, and Annex VI to, its Rules of Procedure, |
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—

having regard to Rules 76 and 77, third indent of, and Annex VI to, its Rules of Procedure,

| — | having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Development (A7-0176/2014), |
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—

having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Development (A7-0176/2014),

| A. | whereas the main goal of the Cotonou agreement, as the framework of the Union’s relations with African, Caribbean and Pacific (ACP) countries and overseas countries and territories (OCTs), is to reduce and eventually eradicate poverty, consistent with the objectives of sustainable development and the gradual integration of the ACP countries and OCTs into the world economy, |
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A.

whereas the main goal of the Cotonou agreement, as the framework of the Union’s relations with African, Caribbean and Pacific (ACP) countries and overseas countries and territories (OCTs), is to reduce and eventually eradicate poverty, consistent with the objectives of sustainable development and the gradual integration of the ACP countries and OCTs into the world economy,

| B. | whereas the European Development Funds (EDFs) are the Union’s main financial instrument for providing development cooperation to the ACP countries, |
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B.

whereas the European Development Funds (EDFs) are the Union’s main financial instrument for providing development cooperation to the ACP countries,

| C. | whereas the EDFs are funded by the Member States and whereas the Commission, as the implementing body, is accountable for the discharge of the EDFs, |
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C.

whereas the EDFs are funded by the Member States and whereas the Commission, as the implementing body, is accountable for the discharge of the EDFs,

| D. | whereas global commitments, individual commitments and payments reached EUR 3 745 million, EUR 3 817 million and EUR 3 292 million respectively for the financial year 2012, |
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D.

whereas global commitments, individual commitments and payments reached EUR 3 745 million, EUR 3 817 million and EUR 3 292 million respectively for the financial year 2012,

| E. | whereas transparency and accountability are prerequisites for democratic scrutiny, as well as effective development aid, |
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E.

whereas transparency and accountability are prerequisites for democratic scrutiny, as well as effective development aid,

| F. | whereas budget support, while playing a key role in driving change and in addressing the main development challenges, carries a considerable fiduciary risk and should be granted only if the beneficiary state is able to demonstrate a sufficient level of transparency, traceability, accountability and effectiveness prior to receiving budget support assistance, |
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F.

whereas budget support, while playing a key role in driving change and in addressing the main development challenges, carries a considerable fiduciary risk and should be granted only if the beneficiary state is able to demonstrate a sufficient level of transparency, traceability, accountability and effectiveness prior to receiving budget support assistance,

| G. | whereas fostering transparency and fighting corruption and fraud are key for the success of the Union’s budget support operations, as highlighted in the above-mentioned Commission Communication entitled ‘The Future Approach to EU Budget Support to Third Countries’, |
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G.

whereas fostering transparency and fighting corruption and fraud are key for the success of the Union’s budget support operations, as highlighted in the above-mentioned Commission Communication entitled ‘The Future Approach to EU Budget Support to Third Countries’,

| H. | whereas sustainability is crucial for the effectiveness of development aid, |
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H.

whereas sustainability is crucial for the effectiveness of development aid,

| I. | whereas cooperation and coordination with other donors and international financial institutions is of paramount importance to avoid duplication, ensure aid effectiveness and foster the capacity to build development aid in beneficiary countries, |
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I.

whereas cooperation and coordination with other donors and international financial institutions is of paramount importance to avoid duplication, ensure aid effectiveness and foster the capacity to build development aid in beneficiary countries,

| J. | whereas it is fundamental to promote Union visibility and to project Union values in all forms of development aid, |
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J.

whereas it is fundamental to promote Union visibility and to project Union values in all forms of development aid,

| K. | whereas the use of innovative financial instruments like blending mechanisms is seen as one way of extending the scope of existing tools such as grants and loans, |
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K.

whereas the use of innovative financial instruments like blending mechanisms is seen as one way of extending the scope of existing tools such as grants and loans,

| L. | whereas Parliament has reiterated its call for the inclusion of the EDFs in the general budget, |
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L.

whereas Parliament has reiterated its call for the inclusion of the EDFs in the general budget,

Statement of Assurance

Statement of Assurance

Reliability of the accounts

Reliability of the accounts

| 1. | Welcomes the Court of Auditors’ opinion that the final annual accounts of the eighth, ninth and 10th EDFs present fairly, in all material respects, the financial position of the EDFs as of 31 December 2012, and the results of their operations and cash flows for the year, in accordance with the provisions of the EDFs’ financial regulations and the accounting rules adopted by the accounting officer; |
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1.

Welcomes the Court of Auditors’ opinion that the final annual accounts of the eighth, ninth and 10th EDFs present fairly, in all material respects, the financial position of the EDFs as of 31 December 2012, and the results of their operations and cash flows for the year, in accordance with the provisions of the EDFs’ financial regulations and the accounting rules adopted by the accounting officer;

| 2. | Notes that in the domains of budget support and the Union’s contributions to multidonor projects implemented by international organisations, the nature of the instruments and payments conditions limit the extent to which transactions are prone to errors; |
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2.

Notes that in the domains of budget support and the Union’s contributions to multidonor projects implemented by international organisations, the nature of the instruments and payments conditions limit the extent to which transactions are prone to errors;

| 3. | Observes that 1 153 nongovernmental organisations (57 % of all NGOs) are operating in the field of EuropeAid and 152 (8 %) in the field of humanitarian aid (ECHO), receiving EUR 1 520 million and EUR 960 million respectively in Union funding; notes that Union funding of NGOs has doubled in 10 years; calls on the Commission to provide an overview of the 30 largest and 30 smallest projects being implemented by NGOs using EDF funding, and an overview of how much of their own funding the organisations have invested in each of these projects; |
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3.

Observes that 1 153 nongovernmental organisations (57 % of all NGOs) are operating in the field of EuropeAid and 152 (8 %) in the field of humanitarian aid (ECHO), receiving EUR 1 520 million and EUR 960 million respectively in Union funding; notes that Union funding of NGOs has doubled in 10 years; calls on the Commission to provide an overview of the 30 largest and 30 smallest projects being implemented by NGOs using EDF funding, and an overview of how much of their own funding the organisations have invested in each of these projects;

| 4. | Is concerned by the fact that recovery orders for interest on pre-financing payments of over EUR 750 000 are rarely issued, contrary to the applicable rules, according to which they should be issued once a year; notes that interests generated by pre-financing are sometimes netted off against claims or reimbursement of costs incurred, these interests not being recognised as revenue; |
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4.

Is concerned by the fact that recovery orders for interest on pre-financing payments of over EUR 750 000 are rarely issued, contrary to the applicable rules, according to which they should be issued once a year; notes that interests generated by pre-financing are sometimes netted off against claims or reimbursement of costs incurred, these interests not being recognised as revenue;

| 5. | Calls on the Commission to apply the EDFs’ financial regulations’ provisions on interest relating to larger pre-financing payments and to closely examine the situation in the delegations to draw up a clear inventory of contracts with open pre-financings; |
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5.

Calls on the Commission to apply the EDFs’ financial regulations’ provisions on interest relating to larger pre-financing payments and to closely examine the situation in the delegations to draw up a clear inventory of contracts with open pre-financings;

| 6. | Regrets, once again, that financial transactions were frequently incorrectly recorded in the Common Relex Information System (CRIS), altering the overall quality and accuracy of data used for the preparation of the annual financial statements, especially with the risk of failing to respect the cut-off principle i.e. to record all financial transactions under the correct accounting period; |
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6.

Regrets, once again, that financial transactions were frequently incorrectly recorded in the Common Relex Information System (CRIS), altering the overall quality and accuracy of data used for the preparation of the annual financial statements, especially with the risk of failing to respect the cut-off principle i.e. to record all financial transactions under the correct accounting period;

| 7. | Acknowledges that the Commission is aware of the current shortcomings in its information system but, nevertheless, as in previous years, strongly calls on the Commission to undertake further efforts and to continuously follow this issue at all operational levels, EuropeAid’s Headquarters and Union delegations; |
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7.

Acknowledges that the Commission is aware of the current shortcomings in its information system but, nevertheless, as in previous years, strongly calls on the Commission to undertake further efforts and to continuously follow this issue at all operational levels, EuropeAid’s Headquarters and Union delegations;

Regularity of transactions

Regularity of transactions

| 8. | Notes with satisfaction that according to the Court of Auditors, the revenue and commitments underlying the accounts are legal and regular in all material aspects; |
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8.

Notes with satisfaction that according to the Court of Auditors, the revenue and commitments underlying the accounts are legal and regular in all material aspects;

| 9. | Is concerned, however, by the Court of Auditors’ assessment relating to the legality and regularity of payments underlying the accounts, according to which the supervisory and control systems at EuropeAid’s Headquarters and Union delegations are partially effective for ensuring the legality and regularity of payments; |
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9.

Is concerned, however, by the Court of Auditors’ assessment relating to the legality and regularity of payments underlying the accounts, according to which the supervisory and control systems at EuropeAid’s Headquarters and Union delegations are partially effective for ensuring the legality and regularity of payments;

| 10. | Regrets that payments were materially affected by error due to the weaknesses identified in the supervision and control mechanisms; notes that out of 167 interim and final expenditure transactions reviewed by the Court of Auditors, 44 (i.e. 26 %) were affected by errors; |
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10.

Regrets that payments were materially affected by error due to the weaknesses identified in the supervision and control mechanisms; notes that out of 167 interim and final expenditure transactions reviewed by the Court of Auditors, 44 (i.e. 26 %) were affected by errors;

| 11. | Recalls that the Court of Auditors’ estimate for the most likely error rate for payments from the eighth, ninth and 10th EDFs is 3 %, which indicates a reduction compared to 2011 (5,1 %) and 2010 (3,4 %); |
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11.

Recalls that the Court of Auditors’ estimate for the most likely error rate for payments from the eighth, ninth and 10th EDFs is 3 %, which indicates a reduction compared to 2011 (5,1 %) and 2010 (3,4 %);

| 12. | Notes that out of 127 expenditure transactions sampled, 28 were affected by quantifiable error, of which 20 were final payments already subject to the Commission’s checks; notes that this represents an increase compared to 2011, where the equivalent numbers were 29 and 11 operations respectively; |
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12.

Notes that out of 127 expenditure transactions sampled, 28 were affected by quantifiable error, of which 20 were final payments already subject to the Commission’s checks; notes that this represents an increase compared to 2011, where the equivalent numbers were 29 and 11 operations respectively;

| 13. | Notes that for budget support transactions reviewed by the Court of Auditors, the quantifiable errors were the incorrect application of the scoring method for defining whether or not partner countries had met the conditions for performance-related payments and the failure to assess compliance with specific conditions for payments; |
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13.

Notes that for budget support transactions reviewed by the Court of Auditors, the quantifiable errors were the incorrect application of the scoring method for defining whether or not partner countries had met the conditions for performance-related payments and the failure to assess compliance with specific conditions for payments;

Effectiveness of systems

Effectiveness of systems

| 14. | Expresses satisfaction that the Commission ensured at least partial implementation of all recommendations of the Court of Auditors annual reports for 2009 and 2010 on the EDFs implementation and calls upon the Commission to further ensure follow-up and implementation of recommendations entailed in the Court of Auditors’ reports for 2011 and 2012; |
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14.

Expresses satisfaction that the Commission ensured at least partial implementation of all recommendations of the Court of Auditors annual reports for 2009 and 2010 on the EDFs implementation and calls upon the Commission to further ensure follow-up and implementation of recommendations entailed in the Court of Auditors’ reports for 2011 and 2012;

| 15. | Acknowledges that the implementation of the EDFs used numerous delivery methods with complex rules and procedures, covering 79 countries, which represents a high degree of inherent risk, according to the Court of Auditors’ evaluation; |
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15.

Acknowledges that the implementation of the EDFs used numerous delivery methods with complex rules and procedures, covering 79 countries, which represents a high degree of inherent risk, according to the Court of Auditors’ evaluation;

| 16. | Is deeply concerned by the Court of Auditors’ finding that the supervisory and control systems are only partially effective; |
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16.

Is deeply concerned by the Court of Auditors’ finding that the supervisory and control systems are only partially effective;

| 17. | Notes with regret, as in the past, that EuropeAid’s ex ante checks, carried out before the project payments were done, still remain vulnerable, according to the Court of Auditors’ assessment; is worried by the fact that errors have been found, despite external audits and expenditure verifications; |
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17.

Notes with regret, as in the past, that EuropeAid’s ex ante checks, carried out before the project payments were done, still remain vulnerable, according to the Court of Auditors’ assessment; is worried by the fact that errors have been found, despite external audits and expenditure verifications;

ex ante

| 18. | Calls on the Commission to review the contracts with external auditors whose audit reports provided to EuropeAid or to Union delegations have proven not to conform to professional auditing requirements or provisions of contracts; |
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18.

Calls on the Commission to review the contracts with external auditors whose audit reports provided to EuropeAid or to Union delegations have proven not to conform to professional auditing requirements or provisions of contracts;

| 19. | Calls on EuropeAid and Union delegations to focus more on the follow-up of external audits and expenditure verification reports, especially when the recovery of ineligible amounts is at stake; |
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19.

Calls on EuropeAid and Union delegations to focus more on the follow-up of external audits and expenditure verification reports, especially when the recovery of ineligible amounts is at stake;

| 20. | Notes with regret the ongoing backlog due to late clearances and contract closures; notes its negative consequences, not only on the overall quality and reliability of the ex ante checks, but also on the traceability of operations, audit trails and the existence of supporting documentation; calls on EuropeAid to remedy to this issue without delay; |
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20.

Notes with regret the ongoing backlog due to late clearances and contract closures; notes its negative consequences, not only on the overall quality and reliability of the ex ante checks, but also on the traceability of operations, audit trails and the existence of supporting documentation; calls on EuropeAid to remedy to this issue without delay;

ex ante

| 21. | Calls on the Commission to continue its efforts to strengthen its current control systems, in particular to ensure a better business continuity and reliable document management as required by internal control standards, and to report annually to Parliament on the corrective actions implemented; |
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21.

Calls on the Commission to continue its efforts to strengthen its current control systems, in particular to ensure a better business continuity and reliable document management as required by internal control standards, and to report annually to Parliament on the corrective actions implemented;

| 22. | Remains seriously concerned about the shortcomings which remain in the management information system on the results and the follow-up of external audits and expenditure verifications, despite the Commission’s commitment to improve the Common Relex Information System (CRIS) data quality in 2012; calls on the Commission to double efforts to develop and launch the CRIS-related audit module, and in particular the follow-up of all audit reports, in the immediate future; |
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22.

Remains seriously concerned about the shortcomings which remain in the management information system on the results and the follow-up of external audits and expenditure verifications, despite the Commission’s commitment to improve the Common Relex Information System (CRIS) data quality in 2012; calls on the Commission to double efforts to develop and launch the CRIS-related audit module, and in particular the follow-up of all audit reports, in the immediate future;

| 23. | Welcomes the efforts undertaken with regard to the use of key performance indicators relating to checks on payments delays and regular reminders to the staff involved in the payments management; encourages, furthermore, the improved use of risk assessment in the framework of the follow-up of the Union delegation’s portfolio of projects; |
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23.

Welcomes the efforts undertaken with regard to the use of key performance indicators relating to checks on payments delays and regular reminders to the staff involved in the payments management; encourages, furthermore, the improved use of risk assessment in the framework of the follow-up of the Union delegation’s portfolio of projects;

| 24. | Believes that increasing both staff awareness and control knowledge, despite staff constraints, of all the abovementioned issues and most recurrent errors is key; believes that constant efforts have to be made to improve the control systems and the chain at all operational levels and to improve EuropeAid’s performance; |
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24.

Believes that increasing both staff awareness and control knowledge, despite staff constraints, of all the abovementioned issues and most recurrent errors is key; believes that constant efforts have to be made to improve the control systems and the chain at all operational levels and to improve EuropeAid’s performance;

| 25. | Welcomes the first measurement study on the residual error rate on closed transactions carried out by EuropeAid to estimate the financial impact of residual errors once all ex ante and ex post controls have been implemented; calls on the Commission to reinforce efforts to better analyse and document the main types of errors and to reduce the residual error rate (RER) in coming years; |
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25.

Welcomes the first measurement study on the residual error rate on closed transactions carried out by EuropeAid to estimate the financial impact of residual errors once all ex ante and ex post controls have been implemented; calls on the Commission to reinforce efforts to better analyse and document the main types of errors and to reduce the residual error rate (RER) in coming years;

ex ante

ex post

| 26. | Notes that on the basis of this study, the error rate was estimated at 3,6 % (representing an amount about EUR 259,5 million), compared to the 3 % estimated by the Court of Auditors; notes that the main causes identified are, in order of importance, weaknesses and errors made by international organisations implementing Union funded projects, amounts not being recovered following audits or expenditure verification missions, various errors regarding Union funds managed indirectly and a lack of documentation in tender procedures; expects that this work on the residual error rate will be fine-tuned further in 2013 towards improved reliability and the outcomes presented to Parliament; |
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26.

Notes that on the basis of this study, the error rate was estimated at 3,6 % (representing an amount about EUR 259,5 million), compared to the 3 % estimated by the Court of Auditors; notes that the main causes identified are, in order of importance, weaknesses and errors made by international organisations implementing Union funded projects, amounts not being recovered following audits or expenditure verification missions, various errors regarding Union funds managed indirectly and a lack of documentation in tender procedures; expects that this work on the residual error rate will be fine-tuned further in 2013 towards improved reliability and the outcomes presented to Parliament;

| 27. | Calls upon the Commission and the Court of Auditors to use a comparable audit approach in future years for the sake of a continuous and comparable assessment within the discharge procedure; |
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27.

Calls upon the Commission and the Court of Auditors to use a comparable audit approach in future years for the sake of a continuous and comparable assessment within the discharge procedure;

| 28. | Notes that 85 % and 53 % of EuropeAid’s 2010 Annual Audit Plan and 2011 Annual Audit Plan respectively was completed by the end of 2012; reiterates that the lack of (adequate) supporting documents and the incorrect application of the procurement procedures by contractors and beneficiaries are among the main weaknesses pointed out by the audit findings; calls on the Commission to further reinforce its control mechanisms and training policies in order to prevent the reoccurrence of those weaknesses in the future; |
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28.

Notes that 85 % and 53 % of EuropeAid’s 2010 Annual Audit Plan and 2011 Annual Audit Plan respectively was completed by the end of 2012; reiterates that the lack of (adequate) supporting documents and the incorrect application of the procurement procedures by contractors and beneficiaries are among the main weaknesses pointed out by the audit findings; calls on the Commission to further reinforce its control mechanisms and training policies in order to prevent the reoccurrence of those weaknesses in the future;

| 29. | Calls on EuropeAid to continue developing the appropriate tools and actions in order to improve the overall effectiveness of the control pyramid within EuropeAid’s Headquarters and Union delegations through targeted awareness raising activities or the increased use of the financial management toolkit by staff and beneficiaries; |
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29.

Calls on EuropeAid to continue developing the appropriate tools and actions in order to improve the overall effectiveness of the control pyramid within EuropeAid’s Headquarters and Union delegations through targeted awareness raising activities or the increased use of the financial management toolkit by staff and beneficiaries;

| 30. | Recalls firmly that the assurance building process also requires measures to reinforce the accountability of Union delegations and the quality and exhaustiveness of the reporting through the External Assistance Management Reports; |
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30.

Recalls firmly that the assurance building process also requires measures to reinforce the accountability of Union delegations and the quality and exhaustiveness of the reporting through the External Assistance Management Reports;

| 31. | Calls on EuropeAid and the European External Action Service (EEAS) to reinforce the supervision of the Heads of Union delegations in their capacity as authorising officers by sub-delegation for the Commission with a view to increasing their accountability in the context of the establishment of the annual activity report; |
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31.

Calls on EuropeAid and the European External Action Service (EEAS) to reinforce the supervision of the Heads of Union delegations in their capacity as authorising officers by sub-delegation for the Commission with a view to increasing their accountability in the context of the establishment of the annual activity report;

| 32. | Regrets the fact that despite last year’s recommendation, no significant improvement could be observed in the functioning of the Internal Audit Capability which has a role to play in the improvement of the internal control system or in the cost-effectiveness analysis of the control architecture/mechanisms; expects, once again, that the situation will change in 2013; |
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32.

Regrets the fact that despite last year’s recommendation, no significant improvement could be observed in the functioning of the Internal Audit Capability which has a role to play in the improvement of the internal control system or in the cost-effectiveness analysis of the control architecture/mechanisms; expects, once again, that the situation will change in 2013;

| 33. | Takes note of the absence of reported cases of whistleblowing, despite the existing quantifiable errors and the high risk environment; reiterates its call to the Commission to further develop both its whistleblowing policy, notably in Union delegations, and its anti-fraud strategy in order to detect double funding activities; |
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33.

Takes note of the absence of reported cases of whistleblowing, despite the existing quantifiable errors and the high risk environment; reiterates its call to the Commission to further develop both its whistleblowing policy, notably in Union delegations, and its anti-fraud strategy in order to detect double funding activities;

| 34. | Asks the Commission to take into account the latest Union developments on beneficial ownership, as discussed in the forthcoming revised directive on the prevention of the use of the financial system for the purposes of money laundering and terrorist financing; asks the Commission to report back on this in its annual activity report; |
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34.

Asks the Commission to take into account the latest Union developments on beneficial ownership, as discussed in the forthcoming revised directive on the prevention of the use of the financial system for the purposes of money laundering and terrorist financing; asks the Commission to report back on this in its annual activity report;

| 35. | Is concerned about Article 190(2) of Commission Delegated Regulation (EU) No 1268/2012 (11); notes that these rules are also stipulated in Articles 72 and 73 of the Cotonou Agreement for ACP countries; takes, in this regard, note of paragraphs 36, 37 and 76 of the Court of Auditors’ special report No 14/2013 that state, inter alia, that in some cases, competitive tendering would have been feasible; calls upon the Commission to critically assess its rules for deviations from procurement procedures and to report back on this in its annual report; |
| --- | --- |

35.

Is concerned about Article 190(2) of Commission Delegated Regulation (EU) No 1268/2012 (11); notes that these rules are also stipulated in Articles 72 and 73 of the Cotonou Agreement for ACP countries; takes, in this regard, note of paragraphs 36, 37 and 76 of the Court of Auditors’ special report No 14/2013 that state, inter alia, that in some cases, competitive tendering would have been feasible; calls upon the Commission to critically assess its rules for deviations from procurement procedures and to report back on this in its annual report;

11

Budget support

Budget support

| 36. | Notes that in 2012, EUR 891 million, representing 29 % of the overall EDF aid disbursement, was provided through budget support; |
| --- | --- |

36.

Notes that in 2012, EUR 891 million, representing 29 % of the overall EDF aid disbursement, was provided through budget support;

| 37. | Welcomes the Court of Auditors’ assessment, according to which general eligibility conditions, such as progress in public sector financial management, have been complied with; |
| --- | --- |

37.

Welcomes the Court of Auditors’ assessment, according to which general eligibility conditions, such as progress in public sector financial management, have been complied with;

| 38. | Welcomes, since the introduction of the new policy outlined in the Commission’s communication of 13 October 2011 entitled ‘The Future Approach to EU Budget Support to Third Countries’, the stronger focus placed on accountability, transparency and reinforced risk management in the management of budget support operations; |
| --- | --- |

38.

Welcomes, since the introduction of the new policy outlined in the Commission’s communication of 13 October 2011 entitled ‘The Future Approach to EU Budget Support to Third Countries’, the stronger focus placed on accountability, transparency and reinforced risk management in the management of budget support operations;

| 39. | Welcomes the Commission’s greater focus on the fight against fraud and corruption, in particular when assessing the Public Financial Management eligibility criterion in terms of budget support; notes in this respect that corruption and fraud constitute one of the five risk categories identified by the Commission as part of its risk management framework developed for budget support programme; |
| --- | --- |

39.

Welcomes the Commission’s greater focus on the fight against fraud and corruption, in particular when assessing the Public Financial Management eligibility criterion in terms of budget support; notes in this respect that corruption and fraud constitute one of the five risk categories identified by the Commission as part of its risk management framework developed for budget support programme;

| 40. | Takes note that programmes relating to good governance are financed in order to support developing countries in their fight against fraud, corruption and financial mismanagement; stresses that a corruption-free judicial system is a condition sine qua non to ensure good governance and the rule of law; calls on the Commission to put a strong emphasis on the judiciary reform programmes; |
| --- | --- |

40.

Takes note that programmes relating to good governance are financed in order to support developing countries in their fight against fraud, corruption and financial mismanagement; stresses that a corruption-free judicial system is a condition sine qua non to ensure good governance and the rule of law; calls on the Commission to put a strong emphasis on the judiciary reform programmes;

condition sine qua non

| 41. | Notes that the phasing-in period of the risk management framework established for budget support programmes was completed as of the 2012 year-end and that the framework has been made mandatory for all new contracts and disbursements as of 1 January 2013; welcomes the strengthening of the risk management framework for budget support programmes and requests a report on the risk strategy and response implemented within the framework of the next discharge procedure; |
| --- | --- |

41.

Notes that the phasing-in period of the risk management framework established for budget support programmes was completed as of the 2012 year-end and that the framework has been made mandatory for all new contracts and disbursements as of 1 January 2013; welcomes the strengthening of the risk management framework for budget support programmes and requests a report on the risk strategy and response implemented within the framework of the next discharge procedure;

| 42. | Looks forward to the implementation of the Commission’s commitment to align democratic scrutiny of the EDFs to the scrutiny exercised by Parliament over the Development Cooperation Instrument as formulated in Commission’s communication of 29 June 2011 entitled ‘A Budget for Europe 2020’; |
| --- | --- |

42.

Looks forward to the implementation of the Commission’s commitment to align democratic scrutiny of the EDFs to the scrutiny exercised by Parliament over the Development Cooperation Instrument as formulated in Commission’s communication of 29 June 2011 entitled ‘A Budget for Europe 2020’;

| 43. | Takes note of EuropeAid’s decision to create regional hubs in partner countries to enhance both the quality of budget support operations and policy dialogue; asks the Commission to report on the first results or lessons learned to the Parliament in the next discharge; |
| --- | --- |

43.

Takes note of EuropeAid’s decision to create regional hubs in partner countries to enhance both the quality of budget support operations and policy dialogue; asks the Commission to report on the first results or lessons learned to the Parliament in the next discharge;

| 44. | Acknowledges the Commission’s room for manoeuvre in assessing whether the general eligibility conditions have been met to make the payments to the partner country, according to the differentiation principle and dynamic approach to eligibility; is concerned by the final use of the funds transferred and the lack of traceability when the Union’s funds are merged within the partner country’s budget resources; |
| --- | --- |

44.

Acknowledges the Commission’s room for manoeuvre in assessing whether the general eligibility conditions have been met to make the payments to the partner country, according to the differentiation principle and dynamic approach to eligibility; is concerned by the final use of the funds transferred and the lack of traceability when the Union’s funds are merged within the partner country’s budget resources;

| 45. | Supports public disclosure of relevant budget information relating to budget support programmes in order to enhance domestic and mutual accountability, including to citizens; |
| --- | --- |

45.

Supports public disclosure of relevant budget information relating to budget support programmes in order to enhance domestic and mutual accountability, including to citizens;

| 46. | Notes that evaluations of on-going EDF projects in Sub-Saharan countries concluded in 2012 indicate improvements in project design and relevance, impact and sustainability on the one hand but also continued problems relating to efficiency and effectiveness on the other hand, with just over half of the projects receiving good or very good marks (12); welcomes the launch in 2012 of comprehensive frameworks to build resilience in the Sahel (AGIR – Alliance globale pour l’initiative Résilience – Sahel) and the Horn of Africa (SHARE – Supporting HoA Resilience) to better address persistent food insecurity in these regions; |
| --- | --- |

46.

Notes that evaluations of on-going EDF projects in Sub-Saharan countries concluded in 2012 indicate improvements in project design and relevance, impact and sustainability on the one hand but also continued problems relating to efficiency and effectiveness on the other hand, with just over half of the projects receiving good or very good marks (12); welcomes the launch in 2012 of comprehensive frameworks to build resilience in the Sahel (AGIR – Alliance globale pour l’initiative Résilience – Sahel) and the Horn of Africa (SHARE – Supporting HoA Resilience) to better address persistent food insecurity in these regions;

12

Alliance globale pour l’initiative Résilience – Sahel

| 47. | Is concerned by the high and increased percentage of evaluated projects in the Pacific region being assessed as having serious deficiencies and only 40,4 % of projects classed as ‘good’ or ‘very good’; calls on the Commission to further investigate the causes of these deficiencies and to enhance in-country capacity in order to improve project design and implementation (13); |
| --- | --- |

47.

Is concerned by the high and increased percentage of evaluated projects in the Pacific region being assessed as having serious deficiencies and only 40,4 % of projects classed as ‘good’ or ‘very good’; calls on the Commission to further investigate the causes of these deficiencies and to enhance in-country capacity in order to improve project design and implementation (13);

13

| 48. | Notes positively the overall satisfaction and improved quality of projects in the Caribbean region where 75,47 % of projects were assessed as performing well or very well (14); |
| --- | --- |

48.

Notes positively the overall satisfaction and improved quality of projects in the Caribbean region where 75,47 % of projects were assessed as performing well or very well (14);

14

| 49. | Calls on the Commission, however, to ensure that the disbursement of funds through budget support is withheld, reduced or cancelled when clear and initial objectives and commitments are not achieved and when the Union’s political and financial interests are at stake; |
| --- | --- |

49.

Calls on the Commission, however, to ensure that the disbursement of funds through budget support is withheld, reduced or cancelled when clear and initial objectives and commitments are not achieved and when the Union’s political and financial interests are at stake;

| 50. | Recalls that the risk of resources being diverted away remains high and that the risks of corruption and fraud are linked to public financial management and reforms; reiterates that stronger and constant attention should be paid to these risks by EuropeAid’s Headquarters and by the Head of Union Delegation in the framework of the political and policy dialogue, especially to assess the responsiveness of the government concerned and its ability to enforce reforms; |
| --- | --- |

50.

Recalls that the risk of resources being diverted away remains high and that the risks of corruption and fraud are linked to public financial management and reforms; reiterates that stronger and constant attention should be paid to these risks by EuropeAid’s Headquarters and by the Head of Union Delegation in the framework of the political and policy dialogue, especially to assess the responsiveness of the government concerned and its ability to enforce reforms;

Union support for governance in the Democratic Republic of the Congo

Union support for governance in the Democratic Republic of the Congo

| 51. | Calls on the Commission and the EEAS, in coordination with other development partners, including Member States, and with a view to programming for the 11th EDF and the design of future Union programmes, to pay increased attention to ensuring an appropriate balance of aid between all provinces, especially the poorer ones, in order to avoid geographical disparities in the distribution of development aid; calls for combined support at a central level for programmes at provincial level that link political and territorial decentralisation with improved natural resource management strategies and infrastructure rehabilitation and development; reconsiders Union support for the improved management of natural resources on the basis of a comprehensive needs assessment; |
| --- | --- |

51.

Calls on the Commission and the EEAS, in coordination with other development partners, including Member States, and with a view to programming for the 11th EDF and the design of future Union programmes, to pay increased attention to ensuring an appropriate balance of aid between all provinces, especially the poorer ones, in order to avoid geographical disparities in the distribution of development aid; calls for combined support at a central level for programmes at provincial level that link political and territorial decentralisation with improved natural resource management strategies and infrastructure rehabilitation and development; reconsiders Union support for the improved management of natural resources on the basis of a comprehensive needs assessment;

| 52. | Calls on the Commission and the EEAS to place greater emphasis, in its dialogue with the Democratic Republic of the Congo (DRC) government, on the fact that democratic elections are a key component of governance; calls on the Commission and the EEAS to carefully assess all risks to ensure that Union programmes in this area do not support regime entrenchment; |
| --- | --- |

52.

Calls on the Commission and the EEAS to place greater emphasis, in its dialogue with the Democratic Republic of the Congo (DRC) government, on the fact that democratic elections are a key component of governance; calls on the Commission and the EEAS to carefully assess all risks to ensure that Union programmes in this area do not support regime entrenchment;

| 53. | Asks the Commission and the EEAS to promote improved DRC government accountability through increased support to strengthen the capacity of national oversight institutions, in particular the specialised committees of the National Assembly and the supreme audit institution; |
| --- | --- |

53.

Asks the Commission and the EEAS to promote improved DRC government accountability through increased support to strengthen the capacity of national oversight institutions, in particular the specialised committees of the National Assembly and the supreme audit institution;

| 54. | Recalls in all governance areas covered by the Union cooperation strategy, to systematically consider the need to support the fight against fraud and corruption; |
| --- | --- |

54.

Recalls in all governance areas covered by the Union cooperation strategy, to systematically consider the need to support the fight against fraud and corruption;

| 55. | Insists that EDF funding should support the long-term restructuring of central judicial bodies in DRC in order to ensure the sustainable establishment of the rule of law in the country; notes in this respect REJUSCO and PAG, two programmes which were granted EUR 7,9 million and EUR 9 million from the 9th EDF; regrets that those programmes failed to achieve their anticipated outcomes and takes note that the Commission’s contribution has consequently been reduced for REJUSCO and stopped in the case of PAG; calls on the Commission to assess the specific shortcomings encountered during the preparation and implementation of those two programmes in order to develop more sustainable programmes on the judicial reform with better-tailored objectives under the 11th EDF; |
| --- | --- |

55.

Insists that EDF funding should support the long-term restructuring of central judicial bodies in DRC in order to ensure the sustainable establishment of the rule of law in the country; notes in this respect REJUSCO and PAG, two programmes which were granted EUR 7,9 million and EUR 9 million from the 9th EDF; regrets that those programmes failed to achieve their anticipated outcomes and takes note that the Commission’s contribution has consequently been reduced for REJUSCO and stopped in the case of PAG; calls on the Commission to assess the specific shortcomings encountered during the preparation and implementation of those two programmes in order to develop more sustainable programmes on the judicial reform with better-tailored objectives under the 11th EDF;

| 56. | Considers at the outset of programmes and regularly during their implementation, the need to assess the likelihood and potential impact of the main risks to the achievement of programme objectives by appraising the relevance and credibility of the country’s policies and action plans for improving governance in relation to the available institutional and financial resources and by monitoring progress against commitments made by the DRC authorities; calls for the establishment of measures to prevent or mitigate risks and to clearly define the course of action to be followed if risks become a reality; |
| --- | --- |

56.

Considers at the outset of programmes and regularly during their implementation, the need to assess the likelihood and potential impact of the main risks to the achievement of programme objectives by appraising the relevance and credibility of the country’s policies and action plans for improving governance in relation to the available institutional and financial resources and by monitoring progress against commitments made by the DRC authorities; calls for the establishment of measures to prevent or mitigate risks and to clearly define the course of action to be followed if risks become a reality;

| 57. | Believes that the Commission should focus its objectives on a limited number of priorities, set out a time frame with regular evaluation assessments which is better adapted to the programme environment and provide for flexibility during programme implementation so that objectives can be adapted promptly where appropriate; |
| --- | --- |

57.

Believes that the Commission should focus its objectives on a limited number of priorities, set out a time frame with regular evaluation assessments which is better adapted to the programme environment and provide for flexibility during programme implementation so that objectives can be adapted promptly where appropriate;

| 58. | Considers that the Commission should strengthen their structured political and policy dialogue with the DRC; notes that this will involve, in full respect of the provisions of the Cotonou Agreement (in particular Article 96 thereof), (i) setting clear, relevant, realistic and time-bound targets which are mutually agreed upon with the national authorities, (ii) periodically assessing compliance with the agreed targets as part of the regular political dialogue with the government, and (iii) considering, after careful deliberation, the adaptation or, in exceptional cases, the suspension or termination of the programme if the DRC government shows insufficient commitment to compliance; |
| --- | --- |

58.

Considers that the Commission should strengthen their structured political and policy dialogue with the DRC; notes that this will involve, in full respect of the provisions of the Cotonou Agreement (in particular Article 96 thereof), (i) setting clear, relevant, realistic and time-bound targets which are mutually agreed upon with the national authorities, (ii) periodically assessing compliance with the agreed targets as part of the regular political dialogue with the government, and (iii) considering, after careful deliberation, the adaptation or, in exceptional cases, the suspension or termination of the programme if the DRC government shows insufficient commitment to compliance;

| 59. | Urges the DRC government to adopt the necessary measures for improving the functioning of the thematic working groups and to monitor the implementation of those measures; |
| --- | --- |

59.

Urges the DRC government to adopt the necessary measures for improving the functioning of the thematic working groups and to monitor the implementation of those measures;

| 60. | Invites the Commission to take a more active leadership role towards Member States by encouraging a coordinated policy dialogue and by increasing Union leverage over the DRC government; |
| --- | --- |

60.

Invites the Commission to take a more active leadership role towards Member States by encouraging a coordinated policy dialogue and by increasing Union leverage over the DRC government;

Union aid to Haiti

Union aid to Haiti

| 61. | Takes note of the fact that the Commission, notwithstanding the Parliament’s resolutions in the context of the 2010 and 2011 discharge procedures, has not yet made public exhaustive performance indicators on which the budget support to the Republic of Haiti was based, neither the detailed assessments of the Government of the Republic of Haiti’s performance on which the decision to give budget support was based; |
| --- | --- |

61.

Takes note of the fact that the Commission, notwithstanding the Parliament’s resolutions in the context of the 2010 and 2011 discharge procedures, has not yet made public exhaustive performance indicators on which the budget support to the Republic of Haiti was based, neither the detailed assessments of the Government of the Republic of Haiti’s performance on which the decision to give budget support was based;

| 62. | Observes that the Commission and the Government of the Republic of Haiti are about to sign a State Building Contract, which should be in conformity with the new criteria for budget support as outlined in the Commission’s Communication of 13 October 2011 entitled ‘The Future Approach to EU Budget Support to Third Countries’; |
| --- | --- |

62.

Observes that the Commission and the Government of the Republic of Haiti are about to sign a State Building Contract, which should be in conformity with the new criteria for budget support as outlined in the Commission’s Communication of 13 October 2011 entitled ‘The Future Approach to EU Budget Support to Third Countries’;

| 63. | Asks the Commission to send the State Building Contract to Parliament as soon as possible, along with all the assessments upon which this contract is based; calls on the Commission to clarify in which way this contract is in line with the abovementioned Communication of the Commission; |
| --- | --- |

63.

Asks the Commission to send the State Building Contract to Parliament as soon as possible, along with all the assessments upon which this contract is based; calls on the Commission to clarify in which way this contract is in line with the abovementioned Communication of the Commission;

| 64. | Requests, particularly in light of recent concerns about the deterioration of the rule of law in Haiti and persistent low scores on international corruption indices, that the Commission explains to Parliament what performance targets have been set for the Haitian government in return for budget support and the modalities for the assessment of these targets; |
| --- | --- |

64.

Requests, particularly in light of recent concerns about the deterioration of the rule of law in Haiti and persistent low scores on international corruption indices, that the Commission explains to Parliament what performance targets have been set for the Haitian government in return for budget support and the modalities for the assessment of these targets;

| 65. | Urges the Commission to ensure that, as announced, the impact evaluation is completed by April 2014, as provided for in paragraphs 62 and 63 of Parliament’s resolution relating to the 2011 discharge procedure and is transmitted to Parliament; |
| --- | --- |

65.

Urges the Commission to ensure that, as announced, the impact evaluation is completed by April 2014, as provided for in paragraphs 62 and 63 of Parliament’s resolution relating to the 2011 discharge procedure and is transmitted to Parliament;

| 66. | Refers to the report of Parliament’s CONT delegation that visited Haiti in 2012, which points out the need to greatly improve the public accessibility of information about the results achieved by Union-funded projects and programmes in Haiti; |
| --- | --- |

66.

Refers to the report of Parliament’s CONT delegation that visited Haiti in 2012, which points out the need to greatly improve the public accessibility of information about the results achieved by Union-funded projects and programmes in Haiti;

| 67. | Observes that since the publication of the CONT report and Union participation in the International Aid Transparency Initiative, some improvements have taken place; |
| --- | --- |

67.

Observes that since the publication of the CONT report and Union participation in the International Aid Transparency Initiative, some improvements have taken place;

| 68. | Requests that the Commission reports on how Haitian Government reports on and accounts for Union funds received has developed since the CONT delegation found control systems inadequate and accounting for Union spending on an unacceptable level; |
| --- | --- |

68.

Requests that the Commission reports on how Haitian Government reports on and accounts for Union funds received has developed since the CONT delegation found control systems inadequate and accounting for Union spending on an unacceptable level;

| 69. | Urges the Commission to substantially speed-up the process of improving the monitoring and evaluation of Union funded projects and programmes and of making the resulting information publicly accessible in a user-friendly way, according to the letter and spirit of the International Aid Transparency Initiative; |
| --- | --- |

69.

Urges the Commission to substantially speed-up the process of improving the monitoring and evaluation of Union funded projects and programmes and of making the resulting information publicly accessible in a user-friendly way, according to the letter and spirit of the International Aid Transparency Initiative;

Cooperation with international organisations and non-governmental organisations

Cooperation with international organisations and non-governmental organisations

| 70. | Is concerned by the Court of Auditors’ finding wherein errors were more frequently identified in operations relating to programme estimates, grants and contribution agreements between the Commission and international organisations than in other forms of support, representing 31 transactions out of the 71 tested (i.e. 44 %); |
| --- | --- |

70.

Is concerned by the Court of Auditors’ finding wherein errors were more frequently identified in operations relating to programme estimates, grants and contribution agreements between the Commission and international organisations than in other forms of support, representing 31 transactions out of the 71 tested (i.e. 44 %);

| 71. | Reiterates the need for the reinforcement of the cooperation and contacts with international organisations on the errors found for transactions implemented by them and discussion on actions to be taken jointly in the future to prevent them; |
| --- | --- |

71.

Reiterates the need for the reinforcement of the cooperation and contacts with international organisations on the errors found for transactions implemented by them and discussion on actions to be taken jointly in the future to prevent them;

| 72. | Strongly believes that it is of utmost interest to exchange good practices in order to define similar and sustainable core principles of assurance in compliance with the Union Financial regulations; |
| --- | --- |

72.

Strongly believes that it is of utmost interest to exchange good practices in order to define similar and sustainable core principles of assurance in compliance with the Union Financial regulations;

| 73. | Encourages all actions, furthermore, leading not only to a better mutual understanding of Union and World Bank methodologies but also reinforcing the overall quality and reliability of the control management with regard to the use of Trust funds; takes the view, to that purpose, that the European Commission’s 7 Pillars Assessment constitutes a real benchmark for providing adequate level of assurance; |
| --- | --- |

73.

Encourages all actions, furthermore, leading not only to a better mutual understanding of Union and World Bank methodologies but also reinforcing the overall quality and reliability of the control management with regard to the use of Trust funds; takes the view, to that purpose, that the European Commission’s 7 Pillars Assessment constitutes a real benchmark for providing adequate level of assurance;

| 74. | Welcomes the decision from the World Bank to endeavour to lift the restriction based on confidentiality and the working arrangement between the World Bank and the Commission whereby one contact person for each institution has been appointed to deal jointly with specific cases where access to documents still encounters some obstacles, both for the Court of Auditors’ audit and for the Commission’s Residual Error Rate study; |
| --- | --- |

74.

Welcomes the decision from the World Bank to endeavour to lift the restriction based on confidentiality and the working arrangement between the World Bank and the Commission whereby one contact person for each institution has been appointed to deal jointly with specific cases where access to documents still encounters some obstacles, both for the Court of Auditors’ audit and for the Commission’s Residual Error Rate study;

| 75. | Welcomes the creation by the World Bank of a single point of entry for all Trust fund-related audits and verifications and the current process of setting up a streamlined framework for dealing with Trust Fund audit review questions; recalls the utmost interest of Parliament in the increased sharing of any relevant information relating to audits of EU-funded trust funds; |
| --- | --- |

75.

Welcomes the creation by the World Bank of a single point of entry for all Trust fund-related audits and verifications and the current process of setting up a streamlined framework for dealing with Trust Fund audit review questions; recalls the utmost interest of Parliament in the increased sharing of any relevant information relating to audits of EU-funded trust funds;

| 76. | Is concerned by the on-going divergence of views between the Commission and the OECD Development Assistance Committee’s secretariat about the Official Development Assistance (ODA) eligibility of European Investment Bank (EIB) loans; in the light of the upcoming revisions of ODA-criteria in 2015; encourages the Commission to resolve its disagreements in an orderly manner as this is important to ensure sound statistical data and comparable benchmarks of financial contributions that are considered to contribute towards development goals; |
| --- | --- |

76.

Is concerned by the on-going divergence of views between the Commission and the OECD Development Assistance Committee’s secretariat about the Official Development Assistance (ODA) eligibility of European Investment Bank (EIB) loans; in the light of the upcoming revisions of ODA-criteria in 2015; encourages the Commission to resolve its disagreements in an orderly manner as this is important to ensure sound statistical data and comparable benchmarks of financial contributions that are considered to contribute towards development goals;

| 77. | Encourages the EIB to foster its dialogue with non-governmental organisations (NGOs) while also ensuring, in the context of certain projects, that the legal status of NGOs associated with the implementation of projects is checked; |
| --- | --- |

77.

Encourages the EIB to foster its dialogue with non-governmental organisations (NGOs) while also ensuring, in the context of certain projects, that the legal status of NGOs associated with the implementation of projects is checked;

| 78. | Asks the Commission to verify, when financing an NGO project, which part of the financing comes from the organisation’s own private funding and which part of the financing from government funding, be it national or European; asks the Commission to publish a report each year about its findings; |
| --- | --- |

78.

Asks the Commission to verify, when financing an NGO project, which part of the financing comes from the organisation’s own private funding and which part of the financing from government funding, be it national or European; asks the Commission to publish a report each year about its findings;

The investment facility

The investment facility

| 79. | Recalls that the funds allocated to the Investment Facility from the ninth and 10th EDF amounted to EUR 3 137 million; |
| --- | --- |

79.

Recalls that the funds allocated to the Investment Facility from the ninth and 10th EDF amounted to EUR 3 137 million;

| 80. | Deplores, as in previous years, the fact that the investment facility is not covered by the Court of Auditors’ Statement of Assurance or Parliament’s discharge procedure, even though the projects are carried out by the EIB on behalf of and at the risk of the Union, using EDFs’ resources; calls, therefore, for an end to be brought to the Tripartite Agreement during the October 2015 revision and include the investment facility in the normal discharge procedure; |
| --- | --- |

80.

Deplores, as in previous years, the fact that the investment facility is not covered by the Court of Auditors’ Statement of Assurance or Parliament’s discharge procedure, even though the projects are carried out by the EIB on behalf of and at the risk of the Union, using EDFs’ resources; calls, therefore, for an end to be brought to the Tripartite Agreement during the October 2015 revision and include the investment facility in the normal discharge procedure;

| 81. | Asks the Court of Auditors to draw up a Special Report on the performance and alignment with Union development policies and objectives of EIB external lending activities before the mid-term review of the EIB’s external mandate and the mid-term review of the Investment Facility, as well as compare the added value with regards the own resources used by the EIB; asks the Court of Auditors, furthermore, to differentiate its analysis between the guarantees granted by the general budget of the Union and by the Member States, the investment facility endowed by the EDF and the usage of reflows for these investments, and the EIB’s use of the various forms of blending used in the EU-Africa infrastructural trust fund and the Caribbean investment facility; |
| --- | --- |

81.

Asks the Court of Auditors to draw up a Special Report on the performance and alignment with Union development policies and objectives of EIB external lending activities before the mid-term review of the EIB’s external mandate and the mid-term review of the Investment Facility, as well as compare the added value with regards the own resources used by the EIB; asks the Court of Auditors, furthermore, to differentiate its analysis between the guarantees granted by the general budget of the Union and by the Member States, the investment facility endowed by the EDF and the usage of reflows for these investments, and the EIB’s use of the various forms of blending used in the EU-Africa infrastructural trust fund and the Caribbean investment facility;

| 82. | Welcomes the first report relating to the implementation of the EIB’s new results measurement framework (REM) for better estimating the project’s expected results and asks for the full methodology to be disclosed, in particular with regards the indicators used for alignment with Union development goals; invites the EIB to regularly issue the REM report and inform Parliament; |
| --- | --- |

82.

Welcomes the first report relating to the implementation of the EIB’s new results measurement framework (REM) for better estimating the project’s expected results and asks for the full methodology to be disclosed, in particular with regards the indicators used for alignment with Union development goals; invites the EIB to regularly issue the REM report and inform Parliament;

| 83. | Encourages the EIB to fine-tune as necessary the REM framework by integrating the first feedbacks from all stakeholders involved, by keeping regular alignment with Union development policies and by indicating the REM’s score per operation in APC or OCTs countries in the annual report; |
| --- | --- |

83.

Encourages the EIB to fine-tune as necessary the REM framework by integrating the first feedbacks from all stakeholders involved, by keeping regular alignment with Union development policies and by indicating the REM’s score per operation in APC or OCTs countries in the annual report;

| 84. | Believes that improvements relating to interinstitutional collaboration have to be pursued, namely the increased work at programming level carried out by the Commission and the EEAS; |
| --- | --- |

84.

Believes that improvements relating to interinstitutional collaboration have to be pursued, namely the increased work at programming level carried out by the Commission and the EEAS;

| 85. | Believes that the EIB should continue to research a convergence of results reporting among the other co-financing international institutions along with the using of common indicators and definitions; |
| --- | --- |

85.

Believes that the EIB should continue to research a convergence of results reporting among the other co-financing international institutions along with the using of common indicators and definitions;

| 86. | Takes the view that it is imperative to ensure a more visible Union by projecting Union values in various domains of intervention such as promoting human rights and rule of law, raising environmental and social standards and overall support for sustainable development and inclusive economic growth; |
| --- | --- |

86.

Takes the view that it is imperative to ensure a more visible Union by projecting Union values in various domains of intervention such as promoting human rights and rule of law, raising environmental and social standards and overall support for sustainable development and inclusive economic growth;

| 87. | Supports, in the context of the Union’s external policies, the progressive development of new financial products with the Commission and the Member States; backs the Investment Facility, in respect of the additionally principle, to continue offering these alternative financial conditions which are not usually available or accessible in local financial markets and that can be mobilised through the development of products blending Union grants, loans and risk sharing instruments or the use of guarantees; demands that best practices and well-defined eligibility criteria be defined for the use of those instruments, accompanied by structured reporting, monitoring and control conditions; |
| --- | --- |

87.

Supports, in the context of the Union’s external policies, the progressive development of new financial products with the Commission and the Member States; backs the Investment Facility, in respect of the additionally principle, to continue offering these alternative financial conditions which are not usually available or accessible in local financial markets and that can be mobilised through the development of products blending Union grants, loans and risk sharing instruments or the use of guarantees; demands that best practices and well-defined eligibility criteria be defined for the use of those instruments, accompanied by structured reporting, monitoring and control conditions;

| 88. | Asks the Commission to consider the development impact of the Investment Facility in its annual report to Parliament and Council on the Union’s development and external assistance policies and their implementation and the annual activity report; |
| --- | --- |

88.

Asks the Commission to consider the development impact of the Investment Facility in its annual report to Parliament and Council on the Union’s development and external assistance policies and their implementation and the annual activity report;

| 89. | Calls on the Commission to provide a fully-fledged report on the impact and results of the implementation of financial facilities in the context of the platform for cooperation on blending and development policies; |
| --- | --- |

89.

Calls on the Commission to provide a fully-fledged report on the impact and results of the implementation of financial facilities in the context of the platform for cooperation on blending and development policies;

| 90. | Looks forward for the inclusion of the Investment Facility in the next evaluation report on Union support to private sector development; |
| --- | --- |

90.

Looks forward for the inclusion of the Investment Facility in the next evaluation report on Union support to private sector development;

Budgetisation of the EDF

Budgetisation of the EDF

| 91. | Regrets that the EDF have not been included in the general budget in the new financial rules applicable to the general budget of the Union (Regulation (EU, Euratom) No 966/2012); |
| --- | --- |

91.

Regrets that the EDF have not been included in the general budget in the new financial rules applicable to the general budget of the Union (Regulation (EU, Euratom) No 966/2012);

| 92. | Recalls that Parliament, the Council and the Commission agreed that those financial rules would be revised in order to include amendments made necessary by the outcome of the negotiations on the multiannual financial framework for the years 2014 to 2020, including on the issue of the possible inclusion of the EDF in the general budget; repeats its call on the Council and Member States to agree to the full incorporation of the EDF into the general budget; |
| --- | --- |

92.

Recalls that Parliament, the Council and the Commission agreed that those financial rules would be revised in order to include amendments made necessary by the outcome of the negotiations on the multiannual financial framework for the years 2014 to 2020, including on the issue of the possible inclusion of the EDF in the general budget; repeats its call on the Council and Member States to agree to the full incorporation of the EDF into the general budget;

| 93. | Underlines that budgetisation would reduce transaction costs and would simplify reporting and accounting requirements by having only one set of administrative rules and decision-making structures, instead of two; |
| --- | --- |

93.

Underlines that budgetisation would reduce transaction costs and would simplify reporting and accounting requirements by having only one set of administrative rules and decision-making structures, instead of two;

| 94. | Notes the commitment by the Commission to include the EDF in the general budget no later than when the Cotonou Agreement expires in 2020; emphasises, however, that it is the view of Parliament that it should happen as soon as possible; |
| --- | --- |

94.

Notes the commitment by the Commission to include the EDF in the general budget no later than when the Cotonou Agreement expires in 2020; emphasises, however, that it is the view of Parliament that it should happen as soon as possible;

| 95. | Deplores that, in the context of the discussion of the future internal agreement for the 11th EDF, the Commission has not made a proposal for a single financial regulation in order to streamline the EDF’s management; |
| --- | --- |

95.

Deplores that, in the context of the discussion of the future internal agreement for the 11th EDF, the Commission has not made a proposal for a single financial regulation in order to streamline the EDF’s management;

| 96. | Is concerned, as regards the implementation of the 11th EDF that entrusted entities can further entrust budget implementation tasks to other organisations governed by private law with a service contract, creating a cascade of trust relationships; recalls for this mode of implementation that those entrusted entities shall guarantee an effective level of protection of the Union’s financial interests; |
| --- | --- |

96.

Is concerned, as regards the implementation of the 11th EDF that entrusted entities can further entrust budget implementation tasks to other organisations governed by private law with a service contract, creating a cascade of trust relationships; recalls for this mode of implementation that those entrusted entities shall guarantee an effective level of protection of the Union’s financial interests;

Follow-up of Parliament resolutions

Follow-up of Parliament resolutions

| 97. | Calls on the Court of Auditors to include in its next annual report a review of the follow-up to the Parliament’s recommendations in Parliament’s annual discharge resolution. |
| --- | --- |

97.

Calls on the Court of Auditors to include in its next annual report a review of the follow-up to the Parliament’s recommendations in Parliament’s annual discharge resolution.

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(1)  OJ C 331 14.11.2013, p. 261.

1

(2)  OJ C 334, 15.11.2013, p. 122.

2

(3)  OJ L 317, 15.12.2000, p. 3.

3

(4)  OJ L 287, 4.11.2010, p. 3.

4

(5)  OJ L 314, 30.11.2001, p. 1 and OJ L 324, 7.12.2001, p. 1.

5

(6)  OJ L 156, 29.5.1998, p. 108.

6

(7)  OJ L 317, 15.12.2000, p. 355.

7

(8)  OJ L 191, 7.7.1998, p. 53.

8

(9)  OJ L 83, 1.4.2003, p. 1.

9

(10)  OJ L 78, 19.3.2008, p. 1.

10

(11)  Commission Delegated Regulation (EU) No 1268/2012 of 29 October 2012 on the rules of application of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council on the financial rules applicable to the general budget of the Union (OJ L 362, 31.12.2012, p. 1).

11

(12)  Commission Staff Working Document SWD(2013) 307 final accompanying the Annual Report 2013 on the European Union’s Development and external assistance policies and their implementation in 2012 (p. 72) and Commission Staff Working Document SWD(2012) 242 final accompanying the Annual Report 2012 on the European Union’s Development and external assistance policies and their implementation in 2011 (p. 67).

12

(13)  Commission Staff Working Document SWD(2013) 307 final accompanying the Annual Report 2013 on the European Union’s Development and external assistance policies and their implementation in 2012 (p. 120).

13

(14)  Ibid, p. 97.

14

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