EN    EN EN 
EN    EN  EUROPEAN COMMISSION 
Brussels, 7.9.2010 
SEC(2010) 1018 final 
REPLIES OF THE COMMISSION TO CH APTER 9 OF THE ANNUAL REPORT  
2009 ADMINISTRATIVE AND OTHER EXPENDITURE 
EN 2   EN REPLIES OF THE COMMISSION TO CH APTER 9 OF THE ANNUAL REPORT  
2009 ADMINISTRATIVE AND OTHER EXPENDITURE 
INTRODUCTION  
REGULARITY OF TRANSACTIONS  
9.9. The Commission welcomes the Court of Auditors' positive assessment that the 
administrative expenditure was free from material error. 
OBSERVATIONS ON SPECIFIC INSTITUTIONS  
9.18. The Office for Administration and Paymen ts of Individual Entitlements (PMO) has 
already taken action to cat ch up delays in the control of na tional social allowances and will 
follow up the detected cases. Between mid Oc tober 2009 and end of April 2010, 348 files out 
of 598 files have been opened and already 243 file s have been closed. Controls will continue 
further.  
It is foreseen to build in the new system the possibility to update  automatically national 
allowances, but it will not be  possible to put this module in to operation before the beginning 
of 2011. However, from that moment onwards, a llowances will be corrected retroactively and 
recovered according to article 85 of the Staff regulations. 
9.19. The Commission (DG RELEX) ta kes note of this observat ion and will address this 
problem with the provision of timely and adequa te information to officials and with regular 
checks. There are checks on the personal situation of staff when new sta ff arrives to take up 
their posts. Regular checks on sta ff who have served for some time  may also be undertaken as 
a part of controls operated by the units re sponsible for the management of rights and 
obligations of staff in Delegations.  
In particular, the forthcoming creation of the European External Action Service (EEAS) will 
require the circulation of information and the adoption where necessary of standard 
documents for the new service. The adaptation of  the EC Staff Regulations will provide the 
opportunity to remind staff that, among other matters, where their personal circumstances 
change they have to inform the EEAS's serv ices and they have to provide the documents 
proving their situation.  
Concerning the five cases identified the Commission will duly follow-up these cases and if 
there is a financial impact, the necessary  corrective measures shall be taken. 
9.20. The update of all files where this provision of  the Staff Regulation is applicable began in 
February 2010. As soon as the backlog will have been addressed, the PMO will review the files concerned whenever there is a modification in the situation of the beneficiaries or when 
the criteria mentioned in Article 81a apply. The PMO will also examine if the new IT system being developed for determining the pensions c ould be used for an automatic update of the 
files. 
E
UROPEAN AGENCIES  
9.34. When preparing the 2008 budget, the Co mmission proposed a budget for the Euratom 
Supply Agency (ESA). This was refused by th e Budgetary Authority and so the Commission 
took charge of all the expenses incurred by the ESA in 2008. The Commission continued to 
take charge of the ESA's expenses in the 2009 and 2010 budgets and has proposed to do likewise for 2011. 
EN 3   EN EUROPEAN SCHOOLS  
9.37. The application of the accrua l based accounting principle is being examined in a review, 
currently under way, of the Fi nancial Regulation of the Euro pean Schools. Proposals arising 
from the review will be submitted to th e Board of Governors later this year. 
Annex 9.4 Point 6. The PMO has already started the te sts of the redevelopped modules for the 
management of individual entitlements. The exte nsive test programme el aborated takes into 
account the lessons drawn from past experience
. 
Point 7. Making the current complementary sche me permanent needs a legal basis. This 
requires an amendment of the Conditions of  Employment of Other Staff, which the 
Commission has included in the EEAS propos al to the Council and the Parliament.