Resolution of the European Parliament containing the comments accompanying the decision concerning discharge in respect of the implementation of the general budget of the European Union for the 2002 financial year — Section V — Court of Auditors
Date: 2004-04-21
Institutions: European Parliament
Subjects: European Court of Auditors, budgetary discharge, financial year, general budget (EU), implementation of the budget

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Official Journal of the European Union

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RESOLUTION

of the European Parliament containing the comments accompanying the decision concerning
discharge in respect of the implementation of the general budget of the European Union for the
2002 financial year — Section V — Court of Auditors

THE EUROPEAN PARLIAMENT,

— having regard to the revenue and expenditure account and balance sheet for the 2002 financial year

(I5-0034/2003 — C5-0088/2004),

— having regard to the annual report of the European Court of Auditors for the 2002 financial year,

together with the replies of the institutions (C5-0583/2003) (1),

— having regard to the statement of assurance by the European Court of Auditors, pursuant to Article
248 of the EC Treaty, as to the reliability of the accounts and the legality and regularity of the
underlying transactions (C5-0583/2003),

— having regard to the Council's recommendation of 9 March 2004 (C5-0145/2004),

— having regard to Article 272(10) and Article 275 of the EC Treaty,

— having regard to Article 22(2) and (3) of the Financial Regulation of 21 December 1977 (2)and

Article 50 of the Financial Regulation of 25 June 2002 (3),

— having regard to Article 143 of the Financial Regulation of 25 June 2002, and in particular

paragraph 4 of that article,

— having regard to Article 276 of the EC Treaty,

— having regard to Rule 93a of and Annex V to its Rules of Procedure,

— having regard to the report of the Committee on Budgetary Control (A5-0228/2004),

1. Notes the replies given by the President of the Court of Auditors on 19 December 2003 to the

questionnaire sent by the Committee on Budgetary Control on 26 November 2003;

2. Notes further the additional information forwarded by the President of the Court in his letters of 16

and 20 February 2004;

3. Notes the report by the independent auditor on the accounts of the Court of Auditors for the 2002
financial year together with the auditor's certificate concerning the regularity and fairness of the
financial statements at 31 December 2002 (4);

4.

5.

Stresses that cooperation between Parliament and the Court of Auditors on the presentation of the
annual report and special reports has further improved;

Points out that a number of financial and management-related problems had initially arisen with
regard to completion of the K2 extension which must be avoided in connection with the next
extension;

(1) OJ C 286, 28.11.2003, p. 1.
(2) OJ L 356, 31.12.1977, p. 1.
(3) OJ L 248, 16.9.2002, p. 1.
(4) OJ C 259, 28.10.2003, p. 1.

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6. Notes that the Court of Auditors, in the course of enlargement from 15 to 25 Members, will be

transferring a larger proportion of its work to its audit groups;

7.

Expressly recommends that the Members of the Court of Auditors ensure that the make-up of their
private offices is multinational and, in particular, that at least one of the two attaché posts at their
disposal is filled by an individual whose nationality is different from their own;

Statement of assurance

8. Notes with approval that, when taking office, the Members of the Court of Auditors lodge
declarations of their financial
interests which are considerably more comprehensive and more
detailed than the equivalent declarations by Members of the Commission or MEPs and which
furthermore, where appropriate, also include details concerning spouses; regards it as proper that
those declarations should not be published; expects the competent authorities to be given access to
those declarations, however, if investigations need to be conducted concerning a Member of the
Court;

9. Notes that, when verifying administrative expenditure, the Court of Auditors will in future evaluate
internal control systems, internal auditors' reports and a representative number of transactions;

10. Realises that the Court of Auditors' statement of assurance is essentially based on sample checks and
is therefore not a tool for the targeted detection of fraud and irregularities, but, rather, is intended to
allow an overall appraisal to be made of the financial management of the Institutions audited; points
out that such an overall appraisal is reliable only if a sufficiently large sample of payments is audited;

11. Encourages the Court in its review of annual DAS evaluation and to work in close collaboration with
the other institutions to provide some form of performance indicators that can measure progress
from year to year;

12. Expects the Court of Auditors to ensure, in preparing its annual report and annual statement of
assurance, that it bases its assessment on the latest international accounting practices and principles;

13.

Is taken aback that, in its annual report for 2002, the Court of Auditors supplied details of the scale
of the sample of the transactions it had audited within agriculture, but, even when asked to do so,
was unwilling to provide information as to the number of transactions audited by it in connection
with the Institutions' administrative expenditure;

14. Asks the Court of Auditors in future to give the number of transactions audited by it, broken down

by Institution;

15. Asks the Court of Auditors to bring the structure of its annual report, in future, into line with Article
143(3) and (4) of the Financial Regulation, which read as follows: ‘The annual report shall contain an
assessment of the soundness of financial management. The annual report shall contain a section for
each institution. The Court of Auditors may add any summary report or general observations which
it sees fit to make’;

16. Reminds the Court that Parliament requires information on every Community Institution, otherwise,
it cannot perform its discharge duties; regrets the fact that the Court's annual report does not comply
with this and contains no specific information whatever on the administrative expenditure of the
Council, the Court of Justice, the Court of Auditors or the Economic and Social Committee; regards
this as unwarranted, one reason being that, year in, year out, the Court submits a separate report for
every single decentralised Community agency;

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17. Welcomes the announcement by the Court of Auditors that in its annual reports, in future, it will

make provision for a separate section for each Community Institution;

Lessons to be learned from the Eurostat case and combating fraud

18. Notes that the Court of Auditors has repeatedly found fault in the past with individual Eurostat

operations;

19. Points out that to date, however, Eurostat as a whole has never been the subject of an in-depth and
comprehensive audit by the Court;
is concerned that that is also true of other Commission
directorates-general and might be one cause of undesirable developments within the Commission;

20.

Is concerned that, in the past, not only were the audit reports by the decentralised audit units in
Commission directorates-general ignored by the Members of the Commission, but, rather, the Court
of Auditors did not insist that such reports be systematically forwarded; asks the Court of Auditors
to carry out a comprehensive evaluation of those reports in future and to publish a summary of the
key results in its annual report;

21. Asks the Court of Auditors to take advantage of its expansion from 15 to 25 Members to ensure
that, in future, its Members carry out an in-depth audit of each and every Commission directorate-
general;

22. Would very much welcome being notified by the Court, at the latest when its next annual report is
presented, which Members have taken on special audit responsibility for which directorate-general;
regards such specific terms of reference as totally compatible with the collective nature of the Court,
provided that the Court has the final say;

23. Asks the Court of Auditors to review its internal decisions on cooperation with OLAF in the light of
the provisions of the new Staff Regulations, in particular as regards the right of staff to approach
OLAF with information directly; calls on the Court of Auditors to forward to Parliament a copy of
the currently applicable provisions and the changes which have been made;

24. Asks the Court of Auditors to comment as to whether, in connection with the awarding procedure at
the Committee of Regions described in paragraph 9.23 of its annual report, referral to the competent
judicial authorities is necessary, since this might constitute restraint on freedom to participate in
tendering procedures, which is a criminal offence under Belgian law (Article 314 of the Belgian
Criminal Code);

Dismissal of a Court of Auditors official

25. Points out that, in April 2002, an official of the Court of Auditors publicly made the most serious

allegations against Members and officials of his Institution;

26. Points out that some of the allegations made by the official had previously been brought to OLAF's

notice by another party or had been the subject of administrative inquiries;

27. Notes that, according to OLAF, the other allegations made by the official could not be substantiated;
notes further that Parliament has been given access to no evidence which might substantiate doubts
as to OLAF's declaration;

28. Notes that, following disciplinary proceedings, the official was dismissed in summer 2003;

29. Regards that decision as a harsh penalty; points out that, pursuant to Articles 90 and 91 of the Staff
Regulations, a complaint may be lodged against it and an appeal may be brought before the Court of
Justice of the European Communities;

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30. Calls in this connection for the Community's staff regulations to be amended so as to make it
possible for ‘whistle blowers’ to turn to a body outside their institution so as to ensure that their
anonymity remains intact (1);

31. Points out to the Court of Auditors that its action against the official must also be gauged against the
measures it is taking against a former Member who is alleged to have seriously breached the
obligations arising from his office;

32.

Is pleased that the Court of Auditors adheres to the same ‘whistleblower's doctrine’ as the
Commission; notes that such a doctrine is only truly effective if staff members are aware of it;
encourages the Court of Auditors to ensure that this information is freely available to its staff;

Proceedings against a former Member of the Court

33. Points out that, on the initiative of a member of the Committee on Budgetary Control, OLAF

instituted an inquiry into the former member of the Court of Auditors in 2002;

34. Points out further that, following on from that inquiry, OLAF referred the matter to the Luxembourg
judicial authorities and that those proceedings have not yet been concluded; acknowledges that the
Court is pressing ahead with recovering misappropriated monies;

35. Points out to the Court of Auditors that, in tandem with the Luxembourg court proceedings, an
application could be made to the European Court of Justice, as the Commission has done in the case
of a former Commissioner; expects the Court of Auditors to refer the matter to the European Court
of Justice, too, in order to have it established, pursuant to Article 247 of the EC Treaty, whether the
former Member seriously breached the obligations arising from his office;

Private use of official cars

36. Asks the Court to confirm that official cars, the cost of which is borne by the Community budget,

can be used exclusively for official journeys;

37. Notes that, supposedly, the Members of the Court of Auditors can use official cars for private
purposes up to a limit of 40 000 km a year and that even holiday travel at taxpayers' expense is
evidently not ruled out;

38. Calls on the Court, if necessary, to amend its rules by 1 July 2004 so as to require its Members to

meet, in full, the cost of the private use of official cars (non-official business);

39. Draws the attention of the Court to the fact that, pursuant to Article 276(3) of the EC Treaty, it is

required to take all appropriate steps to comply with that demand;

Increases in remuneration as a result of weightings

40. Notes that, since 1 January 2003, the Members of the Court have again given themselves the
possibility of benefiting from considerable increases in remuneration by having it transferred in part
to other EU Member States, and taking advantage of ‘weightings’ in the process, rather than receiving
a transfer to accounts in their country of employment, Luxembourg; states that this is defended by
citing a corresponding decision by the Administrative Committee of the European Court of Justice;

41. Points out that that decision is an internal administrative ruling by the Court of Justice and can under

no circumstances be regarded as a ruling in its judicial capacity;

(1)

Texts adopted, 29.1.2004, P5_TA(2004) 0049.

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42. Points out furthermore that that decision by the Court of Justice's Administrative Committee was
taken on 25 September 2002, but that, on a proposal by the Council, Parliament and the Council
subsequently deleted a remark from the Court of Justice's 2003 preliminary draft budget (Item A-
1090) which provided for weightings to be applied, ‘by analogy’ with the provisions of the Staff
Regulations of officials, to the Members of the Court of Justice too;

43. Notes that, in doing so, the budgetary authority made it perfectly clear that it expected an end to be
put to the practice, which, since 1 January 2003, has not been authorised either by provisions in the
relevant regulations on the remuneration of Members of the Institutions or by corresponding
remarks in the budget;

44. Points out that the Members of the Commission no longer claim weightings; calls on the Members of

the Court of Auditors to follow that example ;

45.

Invites its Committee on Budgets to place part of the 2005 administrative appropriations for the
Court of Auditors in reserve if there is no satisfactory response to the concerns raised in this
resolution over non-official car use and the system of salary weightings.