Tuesday 4 May 1999C 279/114 EN 1.10.1999 Official Journal of the European Communities
16. Reaffirms its call for an easing of the burden of taxation on labour and fair taxation of company
earnings and investment income and emphasises the Commission’s call for the convergence of corporatetaxes to prevent the relocation of undertakings solely on tax grounds;
17. Reaffirms its call for a serious, medium-term and non pro-cyclical effort by the Member States to
consolidate their public finances;
18. Points out that the Stability Pact makes it possible for the European Central Bank to lower interest
rates in order to stimulate willingness to invest;
19. Calls for the removal of excessively rigid labour market rules, for the limitation of the burden of
taxes and other charges and for the reduction of non-wage labour costs through developing other sourcesof financing which do not entail additional burdens on male and female workers;
20. Calls for intelligent working time models and the reduction of overtime and advocates flexible
working hours with full respect for social security protection;
21. Supports the Member States’ efforts to implement the European infrastructure programme (TENs)
to promote growth, employment and competitiveness;
22. Refers to the importance of developing a functioning European venture capital market and new
forms of financing, especially for innovative SMEs, and firms in the ‘Third System’ and calls on theEuropean Investment Bank and European Investment Fund in this context to consider whether theresources for venture capital transactions and technological projects cannot be allocated more quickly andwhether the upper limits cannot be raised;
23. Advocates a strategy to release the social potential in terms of creativity, innovation, entrepren-
eurship, investment and achievement in line with the employment policy guidelines;
24. Is of the opinion that the geographical mobility of labour is also an important requirement for a
smoothly functioning labour market; calls on the Commission, therefore, to increase its efforts to achievecomplete freedom of movement for EU citizens, workers and their families within the European Unionand to take account in its proposals of other factors that represent obstacles (e.g. taxation of supplementarypensions) and to present appropriate legislative proposals on transfrontier training and mobility;
25. Instructs its President to forward this resolution to the Council and Commission and to the
governments and parliaments of the Member States and representatives of the two sides of industry.
33. Discharge
(a) A4-0196/99
Resolution on the accounts of the European Communities in respect of the 1996 financial year
The European Parliament ,
− having regard to the ECSC Treaty and in particular Article 78g thereof,− having regard to the EC Treaty and in particular Article 276 (former Article 206) thereof,− having regard to the EAEC Treaty and in particular Article 180b thereof,− having regard to the budget for the 1996 financial year,− having regard to the revenue and expenditure account, the financial analysis and the balance sheet of
the European Union for the 1996 financial year (C4-0196/97),
Tuesday 4 May 19991.10.1999 EN C 279/115 Official Journal of the European Communities
− having regard to the Annual Report for 1996 (C4-0599/97) (1) and the special reports of the Court of
Auditors and the replies of the Institutions,
− having regard to the Council recommendation of 9 March 1998 (C4-0168/98),
− having regard to its resolution of 31 March 1998 informing the Commission of the reasons for the
postponement of the discharge in respect of the implementation of the general budget of the EuropeanUnion for the 1996 financial year (
2),
− having regard to its decision of 17 December 1998 not to grant discharge to the Commission in respect
of the 1996 financial year (3),
− having regard to its resolution of 14 January 1999 on improving the financial management of the
European Commission (4) following the refusal of the 1996 discharge,
− having regard to the report by the Committee on Budgetary Control (A4-0196/99),
1. Recalls its definitive decision not to grant discharge to the Commission in respect of the 1996
financial year and the reasons therefor as voted by Parliament on 17 December 1998, which are annexed;
2. Considers that the accounts of the EC budget for the 1996 financial year should now be noted by
Parliament so that the work on the accounts of later years may be proceeded with;
3. Takes note of the following data established by the Commission in order to close the accounts for the
financial year 1996:
ECU ECU
(a) Revenue : General budget 81 275 072 138,98
− including EFTA/EEA 45 258 019,00
(b) Expenditure
− payments made for the financial year 76 165 594 807,11
including EFTA/EEA 40 985 655,68
− appropriations carried over to 1997 1 288 466 623,48− EFTA-EEA appropriations carried over 55 300,00
77 454 116 730,59
(c) Balance for the financial year 1996
calculated as follows:− revenue for the financial year 81 275 072 138,98
− payments from the appropriations for the financial year 76 165 594 807,11
including EFTA/EEA 40 985 655,68
− appropriations carried over to 1997 1 288 466 623,48− EFTA-EEA appropriations carried over 55 300,00
–77 454 116 730,59
− appropriations carried over from 1995 which have lapsed +143 860 659,67− exchange difference in the financial year 1996 +423 465 513,01− overrun on non-differentiated appropriations carried over
− Commission 00,00− Other Institutions –241,13
Balance for the financial year 1996 4 388 281 339,94
This balance reflects the accounting situation only and does not
include expenditure actually incurred during this financial year.
(d) Utilisation of appropriations for commitment 83 736 599 319,12
(1) OJ C 348, 18.11.1997, p. 1.
(2) OJ C 138, 4.5.1998, p. 43.
(3) Minutes of that date, Part I, Item 7.
(4) Minutes of that date, Part II, Item 1.
Tuesday 4 May 1999C 279/116 EN 1.10.1999 Official Journal of the European Communities
(e) Balance sheet as at 31 December 1996
ASSETS (ECU) LIABILITIES (ECU)
Fixed assets 11 622 101 713,06
Stocks 100 583 209,71Current assets 3 022 732 383,76Cash accounts 11 696 726 750,64Prepaid expenses 567 563 724,97
TOTAL 27 009 707 782,14
Fixed capital 16 343 779 173,98
Short-time liabilities 8 776 630 117,35Cash accounts 1 599 782 123,84
Accrued expenses 289 516 366,97
TOTAL 27 009 707 782,14
4. Instructs its President to forward this resolution together with its annex to the Commission, the
Council, the Court of Justice, the Court of Auditors, the Economic and Social Committee, the Committeeof the Regions, and the European Investment Bank and to have them published in the Official Journal(L series).
ANNEX
Reasons leading to the decision not to grant discharge as voted by Parliament on 17 December 1998
(already adopted by the European Parliament on 17 December 1998 (1))
The European Parliament ,
1. Recalls that, for the third year in succession, the European Court of Auditors has declined to provide
positive global assurance as to the legality and regularity of the transactions underlying the payments forthe financial year (
2),
2. Recalls that, on 31 March 1998, the European Parliament expressed deep concern about the many
problems in nearly all categories of the budget, amounting to an unacceptably high number of cases wherethe execution of the budget has been inappropriate, and decided to defer the granting of discharge inrespect of the 1996 financial year mainly for the following reasons:
(a) the non-execution of the recommendations of its Committee of Inquiry into the Transit System,
especially regarding the computerised control system,
(b) the lack of democratic accountability in the fight against fraud inside the European Institutions,(c) the lack of coherence and sound financial management which led to a low level of execution of all
major foreign policy programmes, i.e. Bosnia-Herzegovina, PHARE, TACIS and MED,
(d) regarding the agricultural sector, the delay in the implementation of the Integrated Control System and
the number of recommendations still not implemented from the BSE committee,
(e) the lack of any precise information as to the results of the proposed measures for job creation in SMEs
through the Structural Funds.
Furthermore, considerable concern was expressed over the need for the Commission to redefine its staff
policy and review its human resources management in the light of policy priorities, and in particular thecustom of delegating public administration prerogatives to third parties;
3. Underlines, with firmness, that the few improvements which have been made so far to fighting fraud
in the EU budget and toughening up management procedures have come from the European Parliament’srecommendations;
(1) Minutes of that date, Part I, Item 7.
(2) Volume II of the Annual Report, p. 8.
Tuesday 4 May 19991.10.1999 EN C 279/117 Official Journal of the European Communities
4. Notes that the Commission has fulfilled the following conditions laid down in its resolution of
31 March 1998:
(a) it has made progress in implementing the Committee of Inquiry’s recommendations concerning
transit;
(b) it has taken measures which, after the failures of the last two years, will permit effective
implementation of the reconstruction programme in the former Yugoslavia;
(c) it has started to implement the staff increase Parliament requested for the Commission unit
responsible for clearance of the EAGGF accounts and thereby met the conditions laid down for theapproval of clearance of accounts for 1992;
(d) it has presented an inventory of all measures aimed at providing aid for small and medium-sized
enterprises in the Structural Funds;
(e) it has given assurances regarding the implementation of the Integrated Management and Control
System in the Member States and has also announced the financial adjustments to be made in respectof the delays;
5. Concludes, however, that the Commission has failed to comply, or to comply satisfactorily, with
Parliament’s requests in some decisive respects and that three major conditions remain to be fulfilled,as illustrated by recent events;
Lack of democratic accountability
6. Recalls its resolution of 31 March 1998 on the postponement of the discharge, which calls for:
(a) lists of all current internal investigations involving allegations of fraud and corruption on the part of
officials of the European institutions to be regularly supplied and found to be adequate,
(b) measures to be been taken to ensure that the competent national judicial authorities are swiftly and
without exception informed of any case of alleged fraud, corruption or any other offence when there isa suspicion that EU officials might be involved;
7. Points out that in its resolution of 31 March 1998 and, prior to that, in its resolution of 17 February
1998 on the Commission’s conduct in respect of alleged fraud and irregularities in the tourism sector (
1)
it stated that it would grant the discharge only once the conditions laid down in paragraph 6 have been met;
8. Notes that
(a) although the statistics now forwarded by the Commission on cases of fraud and corruption committed
by EU officials reveal that not a single official has yet been convicted, they do not contain anyinformation on the nature and scale of the cases examined,
(b) it has still not been ensured that the competent national judicial authorities are notified of each case of
suspected fraud, corruption or other offences without delay, in full and without exception, as therecent ECHO case has shown, the Commission having waited more than six months despite warningsfrom the UCLAF investigators before suspending the main suspect and handing the case over to thejudicial authorities,
(c) the Commission has not complied with Parliament’s request for a proposal for a joint decision of the
European Institutions establishing an Anti-Fraud Office (Office de lutte anti-fraude − OLAF),
submitting instead a proposal for a regulation based on Article 235, which signifies a step backwardsin this matter since it fragments the terms of reference relating to the fight against fraud and negatesthe independent right of investigation in the case of internal checks;
9. Notes that the Commission has ignored its repeated calls, in connection with the MED affair, to turn
over the entire case to the legal authorities in Belgium, France and Italy, even though the reports by theCourt of Auditors and the internal financial audit carried out by the Commission contain clear evidence ofactions (improper overlapping of interests, illegal exertion of pressure on officials, manipulation of publictender procedures) which should be examined in the light of criminal law;
10. Notes, with incomprehension and indignation, that even after the MED affair came to light some of
the technical aid offices involved, or their proprietors, were awarded further direct or indirect contractswith the Commission;
(1) OJ C 80, 16.3.1998, p. 36.
Tuesday 4 May 1999C 279/118 EN 1.10.1999 Official Journal of the European Communities
11. Notes that the procedure chosen by the Commission makes it impossible for effective improve-
ments to be made rapidly in the fight against fraud and that the Commission is thus doing serious harm notonly to its own credibility but also to the credibility of all the European Union’s Institutions;
Lack of coherence and sound financial management in external policy areas
12. Notes that the significant management errors and irregularities detected during the 1996 financial
year and afterwards have not only resulted in major financial losses but have also done serious harm to theEuropean Union’s reputation and credibility;
13. Notes that, despite progress in certain respects, the Commission is still by and large incapable of
implementing the Community’s external policies effectively as the recent report from the European Courtof Auditors on the management of nuclear safety programmes within the framework of PHARE andTACIS illustrates;
14. Points out that it called on the Commission in its resolution of 10 April 1997 on the 1995
discharge (
1) to take energetic measures to solve the serious administrative problems encountered in the
implementation of nuclear safety programmes in Central and Eastern Europe; notes that the Commissionhas not complied with Parliament’s request immediately to set up a task force for this purpose;
Lack of effective measure for improved administrative and budgetary management
15. Notes that the Commission has not yet given a comprehensive follow-up to Parliament’s request to
redefine its staff policy, in particular by submitting realistic estimates of its needs to the budgetaryauthority, and to review its human resources management in the light of policy priorities, especiallyenlargement and the requirements in terms of deconcentration which it implies; recalls that a regularscreening report has already been requested by Parliament already in its resolution of 5 April 1995 (
2)
in the guidelines for the 1996 budget;
16. Notes that lack of action has enabled abuses of procedures in the appointment of officials to
continue unabated, leading to an incapacity of the Commission to ensure that all applicants are treatedequally in its recruitment procedures; notes, moreover, that this appears to be a problem which all theinstitutions have in common;
17. Notes also that high-profile and recent cases involving certain Members of the Commission with
regard to staff appointment are severely damaging the credibility of the Commission;
18. Recalls that, according to the Court of Auditors, the practice of delegating public administration
prerogatives to third parties has assumed dangerous and reprehensible proportions and leads to numerousirregularities, and in particular confusions of interests, and a deterioration in the Commission’s monitoringof the regularity and effectiveness of expenditure;
19. Considers that the following conclusions can be drawn from these observations arising from the
central notion that flaws in management organisation have inevitably led to operational distortions inimplementing policies (for example ‘Mini-budgets’);
Parliament’s access to information
20. Considers that the right of information accorded to it by Article 206(2) of the Treaty in respect of
discharge requires the Commission to submit to it, in their entirety, all documents it considers necessaryfor the exercise of this responsibility;
21. Believes that the Commission has taken a step backwards, as compared with its former practice, by
refusing to make certain basic documents available to Parliament; strongly deplores the communication ofa heavily censored report concerning ECHO to render the document illegible, an action considered bymany to show contempt of Parliament;
22. Notes that Parliament is still unable to verify the actual magnitude of the irregularities concerning
ECHO or to assess the responsibilities or the measures taken to improve administration, since theCommission continues to refuse to forward certain documents;
(1) OJ C 132, 28.4.1997, p. 140.
(2) OJ C 109, 1.5.1995, p. 46.
Tuesday 4 May 19991.10.1999 EN C 279/119 Official Journal of the European Communities
23. Notes that, as its Committee of Inquiry into the Community Transit System was not informed by the
Commission of the real scale of its problems with the computerisation of the transit system, it made anincorrect analysis of the reasons for the delay in the introduction of the system;
Personal responsibility of Commissioners
24. Considers that examples discovered during the discharge procedure have revealed a real concern
that irregularities are committed without individual Commissioners perceiving the need to take personalresponsibility for such actions;
Weaknesses in the Commission’s structure
25. Believes that the discharge procedure has illustrated in many cases a lack of flexibility in personnel
management with unacceptable abuses arising from this. Urgent action is required to modernise thestructures in preparation for an incoming Commission on 1 January 2000.
(b) A4-0201/99
Resolution informing the Commission of the reasons why the discharge cannot at present be given in
respect of the implementation of the general budget of the European Communities for the 1997
financial year
The European Parliament ,
− having regard to the revenue and expenditure accounts and the financial statement of the European
Communities for the 1997 financial year (SEC(98)0519 − C4-0350/98, SEC(98)0520 − C4-0351/98,SEC(98)0522 − C4-0352/98),
− having regard to the report of the Court of Auditors for the 1997 financial year (
1) and to the special
reports relating thereto,
− having regard to the Council recommendation of 15 March 1999 (C4-0156/99),
− having regard to Article 276 of the Treaty establishing the European Community,
− having regard to Article 89 of the Financial Regulation, and in particular paragraphs 1 and 4 thereof,− having regard to Rule 86 of its Rules of Procedure,− having regard to the initial report of the Committee of Independent Experts on the allegations of fraud,
mismanagement and nepotism in the European Commission,
− having regard to the attached Working Document of the Committee on Budgetary Control on the
implementation of the general budget of the European Community for the 1997 financial year,
− having regard to the report of the Committee on Budgetary Control and the opinions of the Committee
on Research, Technological Development and Energy, the Committee on Employment and SocialAffairs, the Committee on External Economic Relations, the Committee on Regional Policy,the Committee on Transport and Tourism, the Committee on the Environment, Public Health andConsumer Protection, the Committee on Culture, Youth, Education and the Media, the Committee onDevelopment and Cooperation, the Committee on Civil Liberties and Internal Affairs, the Committeeon Fisheries and the Committee on Women’s Rights (A4-0201/99),
A. whereas, pursuant to Article 276 of the EC Treaty, the European Parliament gives discharge to the
Commission in respect of the implementation of the budget,
B. whereas the President and Members of the Commission have resigned from office,
(1) OJ C 349, 17.11.1998.