WRITTEN QUESTION E-2559/02

by Erik Meijer (GUE/NGL) to the Commission

(13 September 2002)

Subject: Financial control 3: holding of a completely public debate, with the participation of independent experts, on improving financial management

1. What place does the Commission see for views on financial management and financial control which clash with its own? Does it seek to learn lessons from such conflicting views concerning how it can improve its organisation, or does it regard the expression of such views as a hostile offensive which must be repulsed with all the means at its disposal?

2. Where the existence of problems has been established, does the Commission seek to resolve them as quickly as possible or does it prefer to conceal the problems, delaying a solution?

3. Can the Commission guarantee that, in future, the response to criticism by officials of financial management and financial control will not be to transfer those concerned to another post or to dismiss them, but to hold a public debate for the purpose of assessing the actual facts and to actively invite critical officials, former officials and external experts to give their comments?

4. Can the Commission guarantee that the accountancy service, the Court of Auditors and OLAF will in future have complete freedom to act and will on no account meet with attempts to keep their contested findings out of the public debate or to elevate, from the start, the Commission's assessment to the status of irrefutable final conclusions?

Answer given by Mrs Schreyer on behalf of the Commission

(7 January 2003)

1. Reforms on financial management and control have been introduced under the Commission reform White Paper of March 2000. The recasting of the Financial Regulation(1) was one such. These reforms are the result of intense consultation and negotiation both within and outside the institution. These reform proposals have been welcomed by Parliament, Council and Court of Auditors(2).

2. The Commission always tries to resolve any problems that arise, quickly and effectively. The price of a rapid response must not be the implementation of bad solutions. The pace will depend on the complexity of the problem detected.

3. As concerns the financial management system, the Commission would point out that a critical review of its accounting system, both externally, notably by the Court of Auditors, and internally by its own services, has led it to take remedial action which culminated in the adoption, in June 2002, of the recast of the Financial Regulation. This revised Financial Regulation sets out the principles of an integrated accrual accounting system based on those applied (Netherlands, Sweden, United Kingdom), or being introduced (Spain, France), in some Member States. This recasting was welcomed by the Court of Auditors, supported and improved by many amendments by the European Parliament and decided by the Council. The allegation made by an official that this new law would increase the risk of fraud was not substantiated. This allegation puts in question the efforts of all the Institutions and the Member States involved in the recasting.

Therefore, the Commission does not turn a blind eye to criticism of its financial management system. The Commission does not consider it constructive to engage in a public debate about issues which have already been fully identified, publicly disclosed, and subjected to ongoing remedial action.

Transparency and constructive criticism must not lead to disorder and inefficiency. Officials are bound by their obligations under the Staff Regulations and have a duty to be honest, tactful and discreet and to follow established procedures.

4. As regards the European Anti-Fraud Office (OLAF), the Commission would draw the Honourable Member's attention to the fact that the Director of OLAF, in his third annual activity report presented on 17 October 2002, stated that the Commission had scrupulously respected its operational independence.

Regulations (EC) No 1073/1999(3) and (EC) No 1074/1999(4) on the investigations conducted by OLAF contain provisions on confidentiality and data protection and on the communication of information by OLAF. The final reports of investigations are usually addressed to the competent authorities of the Member States and/or the institutions, bodies or organisations concerned for further action.

As regards the Court of Auditors the Honourable Member will know that the Court is an autonomous Institution. The Commission is grateful to the Court for its constructive recommendations.

The rights and duties of the Accounting Officer are laid down in the Financial Regulation as well as in the Staff Regulation.

(1) Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities, OJ L 248, 16.9.2002.

(2) OJ C 228, 13.8.2001.

(3) Regulation (EC) No 1073/1999 of the European Parliament and of the Council of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF), OJ L 136, 31.5.1999.

(4) Council Regulation (Euratom) No 1074/1999 of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF), OJ L 136, 31.5.1999.