2000/545/EC: Decision of the European Parliament of 6 July 2000 giving discharge in respect of implementation of the general budget of the European Union for the 1998 financial year - Section I - European Parliament/Ombudsman Annex
Date: 2000-07-06
Institutions: European Parliament
Subjects: European Ombudsman, European Parliament, budgetary discharge, implementation of the budget

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II

(Acts whose publication is not obligatory)

EUROPEAN PARLIAMENT

DECISION OF THE EUROPEAN PARLIAMENT

of 6 July 2000

giving discharge in respect of implementation of the general budget of the European Union for the
1998 financial year — Section I — European Parliament/Ombudsman Annex

(2000/545/EC)

THE EUROPEAN PARLIAMENT,

Having regard to its Rules of Procedure, and in particular Rule 184(3) thereof,

Having regard to Article 77 of the Financial Regulation and Article 13 of the Internal Rules for the
implementation of the European Parliament's budget,

Having regard to its resolution of 13 April 2000 postponing the decision on giving discharge in respect of
implementation of the general budget for the 1998 financial year — Section I — European Parliament/
Ombudsman Annex [SEC(1999) 414 — C5-0008/1999 — 1999/2051(DEC)],

Having regard to the information provided by its Secretary General in response to the specific instructions
contained in paragraph 33 of the aforementioned decision,

Having regard to the fact that the giving of discharge has been linked to the issue of financing of the
political groups and parties, which goes beyond the administrative remit of the Secretary General,

Having regard to the report of the Committee on Budgetary Control (A5-0189/2000),

1. Recalls that:

(a) the figures closing the accounts of the institution for the 1998 financial year were adopted in the

context of the abovementioned resolution of 13 April 2000;

(b) the abovementioned resolution instructed the Secretary General to take a number of steps, aimed at
improving financial and administrative management in Parliament; including the following, with
deadlines:

— by 1 June 2000, proposal of concrete measures to reverse the increase in use of the exceptional
direct treaty procedure, for which calls for tenders should be substituted, including measures to
train and improve the qualifications of Parliament's staff involved in the awarding of contracts,

— by 1 June 2000, the Committee on Budgetary Control to be informed of progress made in

introducing the new inventory system,

— by 30 June 2000, a report to be submitted on the conclusions from the current reform process

in the Commission relating to staffing policy,

— by 1 July 2000, the Bureau to submit options for an accurate action and financing plan,
particularly for the Louise Weiss Building in Strasbourg, including a legal assessment taking
account of the state of the negotiations,

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— in good time before the first reading of the 2001 budget, submission of a report assessing
whether it is advisable to assign the European Parliament sole responsibility for the manage-
ment of its freelance interpreting needs;

(c) it called on the Court of Auditors:

— to deliver an opinion in the very near future on whether the procedure adopted for funding the
Altiero Spinelli building is applicable to future projects in the light of the amendments which
have now been made to the Financial Regulation and the rules on awarding public service
contracts,

— to submit a special report on the practice of awarding contracts for security services for EP
including an examination of whether it is economically feasible;

buildings,

(d) paragraph 33 of the abovementioned resolution called for the following additional information and

action before the discharge was given:

— that an action plan be presented to reduce dramatically the number of restricted tenders and

direct agreements,

— that the 1998 inventory be completed and presented,

— that the appropriate bodies be informed about the progress of current disciplinary procedures,

especially those linked to cases lost in the Court of Justice,

— that a long-term buildings policy be presented,

including financing, new investments and
expected total costs, as well as an action plan to avoid contractual obligations limiting the
European Parliament's possibilities for open tendering,

— that a timetable be presented for the administrative reform of Parliament,

— that the new contracts authorised for the security and guarding of the buildings in Strasbourg

be in full accordance with the rules, especially on calls for tender,

— that, in the light of the final report of the Court of Auditors on the expenditure of political
groups, the latter take specific measures to rectify the disclosed shortcomings within two
months of receiving the report.

2. Takes note of the information put at the disposal of the Committee on Budgetary Control outlining the
action taken and the undertakings made, which should allow for a more efficient use of approprations
earmarked for the institution. Considers its Judgement to have been confirmed that postponing the
discharge for 1998 had a constructive effect and spurred Parliament's administration on to greater
efforts to use taxpayers' money more efficiently.

3. Instructs its Committee on Budgetary control, when considering the discharge for 1999, to return to
the central topics broached in connection with the postponement of the discharge for 1998: shortcom-
ings in tenderings, buildings policy, staff policy and the inventory.

Competitive tendering — Awarding contracts

4. Notes the action plan to facilitate competitive tendering under the terms laid down by the current
rules; asks for the optimal planning of awards of contracts and expects a strict monitoring of that
planning as well as the introduction of administrative measures which will make this possible. Recalls
that free competition among providers of goods and services is one of the fundamental principles of
Community law, that Parliament must set a good example in this field and that therefore contracts may
be awarded by private treaty only in exceptional cases, as indeed the Financial Regulation expressly
stipulates. Calls for a report on the state of implementation and a first evaluation by 31 January 2001.

5. Strongly supports the notion of interinstitutional cooperation with regard to the awarding of contracts,
whenever possible; approves the expressed intention on the part of the Secretary General to take the
necessary steps to that effect in cooperation with his counterparts; expects precise information to be
provided as part of the Revenue and Expenditure Account and Balance Sheet, including comparable
statistical data from the various institutions and advisory bodies,
increased
interests.
competition and of the protection of the Union's financial

in the interest of

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Inventory

6. Instructs its competent committee to continue to monitor closely the taking of the inventory and to
ascertain whether the new system for the management of Parliament's property (ELS) is being operated
properly and effectively. Asks that, as a part of the Revenue and Expenditure Account and Balance
Sheet for every financial year, a detailed account is made of the physical permanent inventory; expects
in particular that the Revenue and Expenditure Account and Balance sheet for 2000 will indicate the
completion of measures which are still pending. Expects measures to ensure implementation in
accordance with the new system.

7. Instructs its Secretary-General to take the initiative with his counterparts for the adoption of rules
governing inventory management on an interinstitutional basis, including common rules on deprecia-
tion.

Lost court cases relating to senior appointments

8. Notes the Secretary-General's statement that at present no disciplinary proceedings are pending within
Parliament's administration. Welcomes the fact that on 1 December 1999,
i.e. even before the
deliberations on the discharge for 1998, the Bureau, at the proposal of the Secretary-General, started
an administrative inquiry. Notes the Bureau decision of 13 June 2000,
in connection with the
Frederiksen case, not to seek redress as provided for by Article 22 of the Staff Regulations. Notes that
this decision is based on the consideration that the administrative inquiry did not reveal evidence of
‘serious misconduct’ by individuals as referred to in Article 22 of the Staff Regulations. Points out,
however, that the administrative inquiry revealed both problems with internal decision-making proced-
ures and a tendency to neglect risks associated with court cases in events that it would have been
appropriate to review the case and reappraise the risks associated with legal proceedings at a
considerably earlier stage; recalls paragraph 23 of its abovementioned resolution of 13 April 2000,
calling on the legal service to inform the Bureau about the risks of court cases before the Bureau takes
its decisions, particularly in the light of previous judgements on staff matters; welcomes the Bureau
decision of 13 June 2000 instructing Vice-Presidents Lienemann and Provan to examine whether
further internal administrative reforms are needed in order to avoid similar outcomes. Instructs its
Bureau to inform the competent committees about its conclusions on this matter.

Buildings' policy

9. Regrets the geographical dispersion of Parliament's working places, as well as that of its services, for
which the institution itself bears no direct responsibility, as it is a consequence of the Treaty between
the governments of the Member States. Emphasises the need to minimise further logistical inconve-
niences in the context of the institution's future building needs in view of the upcoming enlargement.
Consequently insists that any future decision in the area of building's policy be guided by the principle
of functionality, particularly as regards the regrouping of Parliament's services in each working place,
and the optimal use of financial resources.

10. Expects those countries hosting Parliament's buildings to each make contributions of a comparable

value toward the acquisition of immovable property;

11. Reiterates its principled position that the method of financing to be used in future acquisitions,
including that of the Louise Weiss building in Strasbourg, be that of direct financing in order to ensure
the maximum degree of Transparency possible as well as obtaining the best value for the European'
taxpayers money; strongly urges the Council to reconsider its position in this matter.

Administrative reform

12. Welcomes the submitted timetable. Instructs its Bureau and Secretary General to keep its competent
committees informed of progress in the implementation of the internal administrative reform; empha-
sises the need for active involvement of staff in this procedure.

13. Reiterates its call

for a common buildings budget and common buildings management for the

institutions and advisory bodies of the European Union.

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Security

14. Notes the Bureau's overruling of the Financial Controller's withholding of Approval No 00/025, in its
capacity as the superior authority; regrets that no attempt was made to award the contract for guarding
its buildings in Strasbourg for a shorter, transitional period and to make use of this time to rerun the
award procedure in full accordance with Community regulations on the award of public contracts.

Financing of the political groups and parties

15. Takes explicit note of the fact that only the political groups themselves have any responsibility for the

use of appropriations made available to them under Chapter 37.

16. Notes with satisfaction the answers of the Bureau to the preliminary observations of the Court of
Auditors and expects that measures aimed at radically reforming the relevant legal framework be
completed without delay in conformity with financial regulations and the principle of transparency.

17. Welcomes the fact that all five political groups currently active in Parliament who had also been active
during the previous legislative period have provided their specific responses to the preliminary
observations of the Court of Auditors.

18. Regrets the unwillingness of the Court of Auditors explicitly to name those groups whose questionable

financial practices are specifically mentioned within the body of the report.

19. Acknowledges the findings of the Court and as a result of these findings:

— welcomes the decision of the Conference of Presidents of 26 February 1999 to enact guidelines for
the purposes of defining those information activities which are characteristic of election
campaigning and are thus to be excluded from being financed by funds derived from the
information campaign budget of the political groups,

— demands that internal bookkeeping procedures be transparent and that these procedures be
followed by all groups, and supplemented by specific group financial regulations, which, as the
court points out,

is not the case,

— demands that transparency be achieved with regard to the financial operations and internal audit

systems of the national delegations of the political groups,

— criticises the failure on the part of certain groups to provide the Office of the President of the
Parliament with the certification of their accounts by an external auditor, even if this was not a
mandatory provision at the time,

— demands that measures be taken to avoid the possibility that financial assistance could be provided
to national political parties or other similar organisations as a result of joint actions undertaken
between them and the political groups,

— regrets that one group has only now, in the context of the annual report, informed the President of
Parliament of the accumulated capital of a public foundation created under Luxembourg law to
which it has allocated funds,

— stresses the need for clarity in regard to work contracts.

The case relating to the Members' cash office

20. Expects the competent authorities,

in the light of the judgement dated 29 March 2000 of the
Luxembourg Court of Appeal in the case brought by Parliament against Royale Belge SA, to initiate the
procedure provided for in Article 22 of the Staff Regulations with a view towards defining responsibili-
ties in connection with the discrepancy of BEF 4 126 125 between the actual cash situation and their
corresponding accounts in 1982.

21. Gives the Secretary-General discharge in respect of the implementation of the budget for the 1998

financial year.

22. Authorises the giving of discharge to the accounting officer for the 1998 financial year.

23. Instructs its President to forward this decision to the Commission, the Council, the Court of Justice of
Auditors, the Economic and Social Committee, the Committee of the Regions and the European
Ombudsman.

The Secretary-General

Julian PRIESTLEY

The President

Nicole FONTAINE