European Parliament resolution on the Commission report on the measures taken in the light of the observations of the European Parliament in its 1998 discharge resolution (COM(2000) 558 — C5-0560/2000 — 2000/2263(DEC))
Date: 2001-04-04
Institutions: Committee on Budgetary Control, European Parliament
Subjects: Community budget, European Parliament, activity report, budgetary discharge, financial policy, financial year

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3. 1998 general budget (discharge)

A5-0112/2001

European Parliament resolution on the Commission report on the measures taken in the light of
the observations of the European Parliament in its 1998 discharge resolution (COM(2000) 558 (cid:129)
C5-0560/2000 (cid:129) 2000/2263(DEC))

The European Parliament,

(cid:129) having regard to its resolution of 6 July 2000 (1) containing the comments which form an integral part
of the decision giving discharge to the Commission for the implementation of the general budget of
the European Union for the 1998 financial year,

(cid:129) having regard to the Commission report (COM(2000) 558 (cid:129) C5-0560/2000),

(cid:129) having regard to Article 276 of the EC Treaty,

(cid:129) having regard to Article 89(8) of the Financial Regulation,

(cid:129) having regard to Annex V(6) to its Rules of Procedure,

(cid:129) having regard to the report of the Committee on Budgetary Control (A5-0112/2001),

A. whereas the decision on the 1998 discharge was postponed with the European Parliament resolution

on 13 April 2000 (2) and was not taken until 6 July 2000 (3),

B. whereas Parliament during the 1998 discharge procedure was unable to verify whether:

(a)

(b)

the Commission had fully informed the competent national judicial authorities about suspected
cases,

the Commission had met its obligation under Articles 73 and 74 of the Financial Regulation and
taken the necessary steps to have the officials liable make good the financial damages for which
they were responsible,

C. whereas, in spite of the postponement of discharge, it was not possible to obtain a full picture of the
events in the (cid:145)FlØchard case(cid:146), and whereas the Committee on Budgetary Control has therefore decided
to conclude both examination of the case and the question of possible consequences, and further
examination of general questions in connection with the case, as part of the discharge procedure for
1999,

D. whereas for 1998, and thus for the fifth consecutive time, the Court of Auditors had declined to
provide an assurance that the transactions underlying the payments for the financial year had been
legal and regular, taken as a whole, and that the funding directly managed by the Commission had
been no less affected by the problems than the expenditure indirectly effected under Member State
management,

Statement of assurance

1. Welcomes the efforts undertaken by the Commission to date to reform its management systems in
order, inter alia, to achieve more efficient financial management of Community funding; with a view to
future discharge procedures, takes note of the Court of Auditors(cid:146) assessment that a medium-term improve-
ment in statement of assurance results is bound up with the future success of this reform project as a
whole;

Reaffirms its call on the Commission, made in paragraph 5 of its resolution of 6 July 2000, to arrive

2.
at a positive statement of assurance (DAS) for the financial year 2003 at the latest;

(1)
(cid:145)Texts Adopted(cid:146), Item 5.
(2) OJ C 40 of 7.2.2001, p. 381.
(3)
(cid:145)Texts Adopted(cid:146), Item 5.

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3.
Regrets that the Commission, although it has presented an action plan to improve financial manage-
ment, has neither expressly committed itself to that objective nor formulated any verifiable intermediate
objectives towards that goal; calls therefore on the Commission to submit a phased plan before 1 October
2001 on realising that objective;

4.
Informs the Commission that such a non-committal announcement conflicts with its own reform
strategy, under which measurable and verifiable performance and achievements are to be expected of
Commission officials and servants to a much greater extent than previously;

Common agricultural policy

Notes that the Commission,

5.
in submitting its proposals recasting the Financial Regulation and
amending Council Regulation (EC) No 1258/1999 on the financing of the common agricultural policy (1),
has taken a number of important steps towards complying with the calls made in paragraphs 9 and 10 of
Parliament(cid:146)s abovementioned resolution of 6 July 2000;

Structural operations

6. Welcomes the adoption by the Commission of three regulations laying down detailed rules for the
implementation of Council Regulation (EC) No 1260/1999 laying down general provisions on the Struc-
tural Fund (2) which seek to:

(a) determine the eligibility of expenditure of operations co-financed by the Structural Funds (3),

(b) permit a more efficient procedure for the Community for making financial corrections to assistance

granted under the Structural Funds (4) and

(c) provide for a number of changes in the management and control systems for assistance granted under
the Structural Funds in order to make the Member States shoulder their obligation to a greater extent
to ensure that there is a sufficient audit trail for expenditure involving Community funds (5);

notes further in this connection that the objectives of these regulations are commensurate with Parlia-
ment(cid:146)s aims laid out in its resolution of 6 July 2000;

7.
Again reaffirms the call contained in paragraph 18 of its resolution of 6 July 2000 for more effective
monitoring of the Structural Funds and for mid-term evaluation to be a genuine instrument for sound
financial management;

Takes note of the Commission consultation paper of 29 November 2000 (SEC(2000) 2079) on

8.
reform of the disciplinary procedure; notes that the proposals it contains are inadequate because:

(a)

(b)

the external element provided for is too weak: only the chairman of the disciplinary board would be
appointed from outside the institution on an annually extendable contract only,

the projected establishment of an additional Investigation and Disciplinary Office to carry out adminis-
trative inquiries will lead to overlapping remits and conflicts with the European Anti-Fraud Office
OLAF, on which the Commission has already conferred responsibility for administrative inquiries in
cases of serious breaches by officials of their obligations under the Staff Regulations,

(c)

the issue of the financial liability of officials for the damage they have caused has been completely
excluded and, to date, the Commission has made no proposals whatever in this connection;

(1) OJ L 160, 26.6.1999, p. 103.
(2) OJ L 161, 26.6.1999, p. 1.
(3) OJ L 193, 29.7.2000, p. 39.
(4) OJ L 64, 6.3.2001, p. 13.
(5) OJ L 63, 3.3.2001, p. 21.

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Officials(cid:146) financial liability

9.
Believes that a credible and effective system of holding authorising officers to account must be put in
place; considers that authorising officers(cid:146) responsibility for financial irregularities should be assessed by a
specialised financial irregularities committee, which would be empowered to refer cases to the disciplinary
procedure under the Staff Regulations, in accordance with the recommendation made by the Committee of
Independant Experts (second report, paragraph 4. 9. 24) and without prejudice to the competences of
OLAF;

10.
Stresses that, even without prior Amendment of the Treaty, provision could be made for a pro-
cedure under which the Court of Auditors would be asked for an opinion prior to any decision on the
financial liability of officials; calls on the Commission to submit appropriate proposals without delay;

Independent financial control

11.
Reaffirms paragraph 51 of its resolution of 6 July 2000, according to which financial control inde-
pendence must be strengthened on a lasting basis and, hence, financial control staff must not be hierarchi-
cally subordinate to directors-general being monitored;

12.
Recalls recital F of its resolution on the Commisson White Paper on reforming the Commission
(aspects concerning the Committee on Budgetary Control) (1) of 30 November 2000, in which it noted that
the effectiveness of the reform proposed in the White Paper would be judged by, inter alia, the application
of the relevant financial provisions being monitored and implemented with appropriate supervisory and
sanction mechanisms;

13.
Reaffirms paragraphs 27 and 28 of the same resolution, in which it noted with satisfaction the
Commission(cid:146)s decision to decentralise financial control within each Directorate-General, subject to a
number of conditions being met; considers it essential that the Internal Audit Service be entrusted with
the task of coordinating and supervising the internal audits carried out within Directorates-General and of
ensuring and monitoring the professional independence of these internal audits;

PerryLux affair

14.
Calls upon the Commission to clarify why, in the proceedings before the Belgian courts in the
(cid:145)PerryLux affair(cid:146), the Commission has not yet appeared as joint plaintiff and thus has no access to the files;
calls on the Commission to appear without delay as joint plaintiff in Belgium, as it has already been doing
for some time in the corresponding proceedings before the Luxembourg courts;

15.
Is concerned that despite the action evidently being taken on the basis of an OLAF report against
the officials and servants who allegedly falsified reports for an advisor to a former Commissioner, after the
event, in order to justify his activities as a visiting scientist, action is not being taken against those who
prepared, authorised and signed the contracts with the advisor, although he manifestly lacked the high
degree of scientific competence required for the award of such a contract;

16. Welcomes the Commission(cid:146)s announcement (2) that an administrative inquiry has been initiated to
clarify the circumstances which led to the award of contracts to another (cid:145)special advisor(cid:146), who is also
reported to have played a key role in the Elf/Leuna affair, to the former Commissioner; regrets that this
inquiry is only taking place now, though UCLAF/OLAF was informed as long ago as December 1998, on
the basis of a witness statement, about the possible existence of a second (cid:145)special adviser(cid:146);

Reminds the Commission of its undertaking to reopen disciplinary proceedings if new facts come to

17.
light;

(cid:145)Texts Adopted(cid:146), Item 15.

(1)
(2) Mr Kinnock(cid:146)s reply of 21 February 2001 to Written Question E-4073/00.

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18.
Calls on the Commission to apply the provisions of Article 213 of the EC Treaty rigorously and
invoke the European Court of Justice if OLAF investigations currently in progress were to confirm that
Members of the previous Commission breached the obligations of their office;

Deficiencies in respect of the handling of nuclear material

19.
Notes that the outcome of the administrative inquiry into deficiencies in the handling of nuclear
material at the Joint Research Centre (1), undertaken by way of follow-up to paragraph 1(j) of its resolution
of 13 April 2000, was that no irregularities at all could be established; regrets that the Commission has
hitherto not acted on the request to forward the inquiry report; notes that, for this reason,
it is not
possible to check the accuracy or otherwise of accusations that the inquiry was not conducted with the
requisite objectivity;

Provision of information to Parliament

Regrets that, even after the conclusion of the framework agreement, the Commission does not
20.
forward confidential information in a way that would allow Parliament to meet in full its verification
obligations under the discharge procedure and that, instead, the provisions of the framework agreement
are being used to drive a wedge between MEPs by circulating certain information on a targeted basis to
selected office-holders only;

Reaffirms its call in paragraph 25 of its resolution of 16 January 2001 on the follow-up to the
least as much access to confidential documents and

21.
1997 discharge (2),
that Parliament needs at
information as the European Court of Auditors;

*

*

*

Instructs its President to forward this resolution to the Commission, the Council and the Court of

22.
Auditors.

(1) Mr Busquin(cid:146)s reply of 21 February 2001 to Written Question E-4072/00.
(2)

(cid:145)Texts Adopted(cid:146), Item 6.

4. 1999 discharge (Section III)

A5-0113/2001

1.
European Parliament decision concerning discharge in respect of the implementation of the gen-
eral budget of the European Union for the 1999 financial year (Commission) (SEC(2000) 537 (cid:129)
C5-0310/2000 (cid:129) 2000/2155(DEC))

The European Parliament,

(cid:129) having regard to the consolidated revenue and expenditure account and balance sheet for the 1999
financial year (SEC(2000) 537 (cid:129) C5-0310/2000, SEC(2000) 538 (cid:129) C5-0311/2000, SEC(2000) 1624
(cid:129) C5-0313/2000) (1),

(cid:129) having regard to the annual report concerning the 1999 financial year and the special reports of the

Court of Auditors, and the Institutions(cid:146) replies (C5-0617/2000) (2),

(cid:129) having regard to the Statement of Assurance as to the reliability of the accounts and the legality and
regularity of the underlying transactions provided by the Court of Auditors pursuant to Article 248 of
the EC Treaty (C5-0617/2000),

(1) OJ C 343, 1.12.2000.
(2) OJ C 342, 1.12.2000.