2012/620/EU: Decision of the European Parliament of 10 May 2012 on discharge in respect of the implementation of the budget of the European Food Safety Authority for the financial year 2010
Date: 2012-05-10
Institutions: European Parliament
Subjects: European Food Safety Authority, budgetary discharge, financial year, general budget (EU)




L_2012286EN.01036701.xml










17.10.2012   


EN


Official Journal of the European Union


L 286/367








            DECISION OF THE EUROPEAN PARLIAMENT
         
of 10 May 2012
         
on discharge in respect of the implementation of the budget of the European Food Safety Authority for the financial year 2010
(2012/620/EU)


THE EUROPEAN PARLIAMENT,






—


having regard to the final annual accounts of the European Food Safety Authority for the financial year 2010,










—


having regard to the Court of Auditors’ report on the annual accounts of the European Food Safety Authority for the financial year 2010, together with the Authority’s replies (1),










—


having regard to the Council’s recommendation of 21 February 2012 (06083/2012 – C7-0051/2012),










—


having regard to Article 319 of the Treaty on the Functioning of the European Union,










—


having regard to Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (2), and in particular Article 185 thereof,










—


having regard to Regulation (EC) No 178/2002 of the European Parliament and of the Council (3) establishing a European Food Safety Authority, and in particular Article 44 thereof,










—


having regard to Commission Regulation (EC, Euratom) No 2343/2002 of 19 November 2002 on the framework Financial Regulation for the bodies referred to in Article 185 of Council Regulation (EC, Euratom) No 1605/2002 on the Financial Regulation applicable to the general budget of the European Communities (4), and in particular Article 94 thereof,










—


having regard to Rule 77 of, and Annex VI to, its Rules of Procedure,










—


having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on the Environment, Public Health and Food Safety (A7-0106/2012),






1.   

Postpones its decision on granting the Executive Director of the European Food Safety Authority discharge in respect of the implementation of the Authority’s budget for the financial year 2010;



2.   

Sets out its observations in the resolution below;



3.   

Instructs its President to forward this Decision and the resolution that forms an integral part of it to the Executive Director of the European Food Safety Authority, the Council, the Commission and the Court of Auditors, and to arrange for their publication in the Official Journal of the European Union (L series).






The President

Martin SCHULZ
            



The Secretary-General

Klaus WELLE
            





(1)  
            OJ C 366, 15.12.2011, p. 106.

(2)  
            OJ L 248, 16.9.2002, p. 1.

(3)  
            OJ L 31, 1.2.2002, p. 1.

(4)  
            OJ L 357, 31.12.2002, p. 72.






            RESOLUTION OF THE EUROPEAN PARLIAMENT
         
of 10 May 2012
         
with observations forming an integral part of its Decision on discharge in respect of the implementation of the budget of the European Food Safety Authority for the financial year 2010


THE EUROPEAN PARLIAMENT,






—


having regard to the final annual accounts of the European Food Safety Authority for the financial year 2010,










—


having regard to the Court of Auditors’ report on the annual accounts of the European Food Safety Authority for the financial year 2010, together with the Authority’s replies (1),










—


having regard to the Council’s recommendation of 21 February 2012 (06083/2012 – C7-0051/2012),










—


having regard to Article 319 of the Treaty on the Functioning of the European Union,










—


having regard to Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (2), and in particular Article 185 thereof,










—


having regard to Regulation (EC) No 178/2002 of the European Parliament and of the Council (3) establishing a European Food Safety Authority, and in particular Article 44 thereof,










—


having regard to Commission Regulation (EC, Euratom) No 2343/2002 of 19 November 2002 on the framework Financial Regulation for the bodies referred to in Article 185 of Council Regulation (EC, Euratom) No 1605/2002 on the Financial Regulation applicable to the general budget of the European Communities (4), and in particular Article 94 thereof,










—


having regard to Rule 77 of, and Annex VI to, its Rules of Procedure,










—


having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on the Environment, Public Health and Food Safety (A7-0106/2012),










A.


whereas the Court of Auditors has stated that it has obtained reasonable assurances that the annual accounts for the financial year 2010 are reliable and that the underlying transactions are legal and regular,










B.


whereas on 10 May 2011 Parliament granted the Executive Director of the European Food Safety Authority discharge for implementation of the Authority’s budget for the financial year 2009 (5), and in its resolution accompanying the discharge decision, inter alia:






—


called on the Authority to strengthen the budget processes relating to its differentiated appropriations and the planning and monitoring of multiannual implementation,










—


urged, in addition, the Authority to improve its budget management in order to reduce its high carry-over amounts,










—


invited the Authority to initiate a survey on the potential conflicts of interest of its leading scientists, its Management Board and its panel members, so that possible omissions in the declarations of interest can be detected and followed by action in a timely manner,














C.


whereas the overall budget of the Authority for 2010 was EUR 74 700 000 compared with EUR 71 400 000 in 2009, which represents an increase of 4,6 %; whereas the initial contribution of the Union to the budget of the Authority for 2010 was EUR 69 041 000, which represents an increase of 4,36 % compared with its initial contribution in 2009 (6),










D.


whereas the workload continues its growing trend both in volume and in complexity with the adoption of more than 560 scientific outputs,






Budget and financial management









1.


Recalls that the initial Union contribution to the Authority for 2010 amounted to EUR 69 041 000; notes however that EUR 3 950 000 coming from the recovery of surplus, was added to that amount which, as a result, makes a total Union contribution of EUR 72 991 000 for 2010;












2.


Acknowledges from its Annual Activity Report (AAR) that, in 2010, the Authority had a budget execution rate of 98,8 % in terms of committed appropriations and of 83,5 % in terms of payment appropriations; takes note that under Title 1 (Staff) and Title 2 (Infrastructure) the budget was fully executed while under Title 3 (Operations) the execution rate reached 96,5 %;












3.


Notes, however, from the AAR that in 2010 the Authority had a budget execution rate of only 83,5 % in terms of payment appropriations, which is 11 % below the target set by the Authority; finds from comments by the Authority that the execution rate in terms of payment appropriations is lower than expected for the following main reasons:






—


major data processing and IT operational support projects were initiated in November 2010 and therefore triggered payments for an amount of EUR 4 300 000 only in 2011,










—


delays in contracting scientific cooperation activities and lower payment levels under the existing grant and procurement programme led to an underspend of the related differentiated credits amounting to EUR 1 300 000,










—


payments for an amount of EUR 1 100 000 for specific projects in administration and communication were postponed to 2011;
















4.


Acknowledges from the Authority that budget execution was reported to the Management Board on a monthly basis, deviations from the budget execution targets by activity or in relation to the scientific cooperation programme were pointed out and corrective action taken;












5.


Urges, however, the Authority to take further action to enable a satisfactory budget execution in terms of both commitment and payment appropriations and to inform the discharge authority of the progress achieved;












6.


Notes from the Authority that in line with the schedule of the Commission, migration to the accrual-based accounting (ABAC) system was scheduled for September 2011 and implemented accordingly;












7.


Finds it unacceptable that while the Management Board of the Authority consists of only 15 members, each meeting costs on average EUR 92 630, which represents an amount of EUR 6 175 per member; underlines that this amount is nearly three times higher than the second most expensive Management Board of a decentralised agency; is of the opinion that the Management Board meetings costs are excessive and should be reduced drastically; calls on the Authority and its Management Board to remedy the situation immediately and to inform the discharge authority of the measures undertaken by 30 June 2012;





Carry-overs and contract management process









8.


Acknowledges from the Authority that 6 % (EUR 270 000 000) of commitments for operational activities carried over from 2009 had to be cancelled; notes that this is an improvement compared with the previous year in which 19 % of commitments for operational activities were carried over from 2008, 37 % of such commitments were carried over from 2007 and 26 % of such commitments were carried over from 2006;












9.


Urges, once more, the Authority to improve its budget management in order to reduce its high carry-over amounts; notes, in particular, that this situation demonstrates weaknesses in the Authority’s contract management and monitoring of the remittance of reports and cost statements;












10.


Calls on the Authority to develop and implement a common monitoring system for the management of all its contracts; acknowledges, in particular, the absence of a central and coordinated capacity at directorate level responsible for the monitoring of contracts; underlines that this entails a risk of inefficient use of resources and uncoordinated monitoring of contracts and therefore asks the Authority to centralise these responsibilities at the level of each directorate;












11.


Urges, in addition, the Authority to improve the reporting on contract implementation in order to guarantee effective supervision and management of its operational activities;





Procurement









12.


Notes from its AAR that, in 2010, the Authority finalised 24 procurement procedures in Communication and Administration for an amount of EUR 48 800 000, as well as 75 procurement contracts and 10 grant agreements as part of the scientific cooperation programme with values of EUR 5 700 000 and EUR 2 100 000 respectively;












13.


Notes that the Authority has had a Practical Procurement Guide since 2008 to provide practical guidance to its staff in preparing and implementing procurement procedures and the resulting contracts, and that the Guide is regularly updated; notes moreover that the Guide is being revised to take into account the rules recently adopted by the Commission on public procurement and revision of the Financial Regulation;





Human resources









14.


Notes from the Authority that 99 % of planned posts were either filled or under offer by the end of 2010;












15.


Calls on the Authority to address its weaknesses in recruitment procedures, which put at risk the transparency of the procedures; acknowledges, in particular, from the Court of Auditors that the Authority did not ensure the anonymity of the written tests and decided pass marks for the various stages of the selection process after the evaluation process had already started;












16.


Is concerned that the Authority delayed for over 12 months the Internal Audit Service (IAS)’s ‘very important’ recommendation which called on the Authority to define contract renewal processes and ensure the transparency of decision-making; calls, therefore, on the Authority to explain to the discharge authority the reasons behind this delay and to rapidly address this deficiency;





Conflict of interest and ‘revolving door’ cases









17.


Notes, in particular, that in September 2010 the Chair of the Management Board was reported to have direct links to the food industry, and to be a member of the Board of Directors of the International Life Science Institute (ILSI) — Europe;












18.


Considers that, while a dialogue with industry on product assessment methodologies is legitimate and necessary, this dialogue should not undermine the independence of the Authority nor the integrity of risk assessment procedures; asks therefore the Authority to consider as a conflict of interest the current or recent past participation of its Management Board, panel and working group members or staff in ILSI activities such as taskforces, scientific committees or chairs for conferences;












19.


Urges the Court of Auditors to finalise and present its audit of conflict of interest in the Authority;












20.


Recalls that the current Chair of the Management Board failed, in 2010, to declare her membership of the Board of Directors of the ILSI; notes that ILSI is financed by firms in the food, chemical and pharmaceutical sectors;












21.


Considers, therefore, that a thorough case-by-case analysis of these reports and of possible and actual conflicts of interest should be carried out in order to evaluate the objectivity and impartiality of the Authority at all levels and the work it carries out; calls, moreover, on the Authority to undertake a thorough screening of the declarations of interest submitted by its staff, experts and members of the Management Board, followed by concrete measures to end conflicts of interest and to provide information to the public; calls on the Authority to inform the discharge authority of the screening process and the concrete measures adopted, by means of a detailed written report by 30 June 2012;












22.


Notes that the Court of Auditors has observed that the review process of the declarations of interests of the members of the Management Board is insufficiently rigorous and detailed and puts the completeness and transparency of the procedure at risk;












23.


Considers that product assessment should not be based solely on industry data, but should duly take into account independent scientific literature published in peer-reviewed journals; stresses that extra caution should be exercised in relation to industry influence in the development of guidelines and assessment methodologies, which should not favour industry-sponsored studies on speculative grounds and which should be developed in an open, transparent and balanced manner;












24.


Reminds the Authority that the rules governing declarations of interests should be accompanied by a set of consequences applied when those rules are breached; further, notes that the Authority should, in addition, focus on public interest in its independent decision-making by taking into account all relevant data and information;












25.


Notes that in March 2010 a German NGO turned to the European Ombudsman, complaining that the Authority did not adequately address a potential conflict of interest concerning the move of its Head of Genetically Modified Organisms Unit to a biotechnology company in 2008 less than two months after the staff member in question left the Authority, without a ‘cooling off’ period;












26.


Underlines that the Ombudsman concluded that the Authority had not carried out a thorough assessment of the alleged potential conflict of interest and called on the Authority to improve the way in which it applies its rules and procedures in future ‘revolving door’ cases; stresses, moreover, that the Ombudsman also observed that negotiations by a serving member of staff concerning a future job which could amount to a ‘revolving door’ situation would themselves constitute a conflict of interest and recommended that the Authority should strengthen its rules and procedures accordingly; calls on the Authority to inform the discharge authority of the concrete measures adopted, and their respective deadlines, to properly address the conclusions of the Ombudsman;












27.


Once more, urges the Authority to take appropriate measures in cases of conflict of interests and ‘revolving door’ cases, including when cases occur within the Management Board, and to inform both the discharge authority and the public promptly of the measures taken;












28.


Notes from its AAR that in 2010 the Authority took several initiatives in the area of prevention and management of conflict of interests:






—


the commissioning of an independent report to assess the implementation by the Authority of its 2007 policy on declaration of interests,










—


the commissioning of an independent report to benchmark the Authority’s independence system against those of both national and international peer organisations,










—


the conclusion of an external independent review of its declaration of interest assessments;
















29.


Welcomes the fact that the Authority has adopted a new definition of conflicts of interests, based on the OECD definition, but warns that further improvements are necessary to strengthen the Authority’s policy on independence; stresses in particular that the criteria that define a conflict of interests should be clarified and widened, and include current and recent past activities;












30.


Takes note from the Authority that a review of its policy on declarations of interest took place in 2011 and that its Management Board adopted a new policy on independence and scientific decision-making processes;












31.


Observes that the Authority is repeatedly challenged over alleged cases of conflicts of interest involving members of the experts’ panels, especially in the case of the panels on ‘Food additives and nutrient sources added to food’ (ANS) and ‘Genetically modified organisms’ (GMO); underlines that eight of the Authority’s panels and its scientific committee were due for renewal in March 2012 and that the Authority’s capability of implementing the new policy is under scrutiny; calls therefore on the Authority to inform the discharge authority in writing by 30 June 2012 of the steps undertaken to implement the new policy on independence and scientific decision-making processes and to conform to the OECD definition of conflict of interest when renewing its panels and its scientific committee; at the same time, calls on the Authority to inform the discharge authority of the new composition of the panels and of the scientific committee by 30 June 2012;












32.


Takes note of the revision of the Authority’s procedures in December 2010 to ensure the implementation of the obligations deriving from Article 16(2), and Articles 17 and 19 of the Staff Regulations of Officials and the Conditions of Employment of Other Servants of the European Union, laid down in Council Regulation (EEC, Euratom, ECSC) No 259/68 (7); was informed that in 2010, 20 staff members left the Authority, all of whom received a letter on departure reminding them of their obligations vis-à-vis the Authority; calls on the Authority to further improve the way in which it applies its rules and procedures to avoid the ‘revolving door’ cases recently highlighted by the European Ombudsman; considers that any problems with the enforcement of staff rules and declarations of interests undermine the Authority’s credibility;












33.


Notes that the Authority has been audited by the Court of Auditors in the framework of the Special Report on conflicts of interest management in the Union Agencies and acknowledges from the Court of Auditors that the Special Report is due to be published by the end of June 2012;












34.


Acknowledges from the Special Report that the Commission is considering a modification of the future funding of the Authority and proposed that the discharge authority and the Council consider a partial fee-based financing structure for the Authority; notes that the Commission is conducting an impact assessment on the matter; expresses, however, concerns that the new funding scheme proposed by the Commission could affect the independence of the Authority;





Performance









35.


Notes from its AAR that a review of its efficiency, led by external consultants, began in 2010 with the launch of the e3 programme; acknowledges that the inception phase of the programme concerned the establishment of the programme portfolio, structure and governance in preparation for the structural reorganisation that would be implemented in 2011; invites the Authority to inform the discharge authority of the conclusions drawn by the review and of the measures it has adopted and implemented to address them;












36.


Welcomes the Authority’s plans to enhance its medium-term planning with a view to better involving the Member States in the Authority’s work and better pool its resources across Europe; supports the Authority in strengthening its cooperation with Member States in the area of risk assessment;












37.


Underlines the need for the Authority to ensure that its advice is of a high quality and is independent, in order to guarantee compliance with Union safety standards, scientific excellence and independence on all matters with a direct or indirect impact on food and feed safety, and plant protection; recommends, particularly in the interests of transparency, measures to further foster and monitor internal rules on declarations of interest by staff of the Authority and by experts working for the Authority;












38.


Considers that the main tasks of the Authority are the provision of independent scientific advice on matters with a direct or indirect impact on food safety, the conduct of risk assessments to provide Union institutions, Member States and policy-making bodies with a sound scientific basis for defining policy-driven legislative or regulatory measures and the collection and analysis of scientific data;





Internal audit









39.


Acknowledges that six ‘very important’ recommendations from the IAS still need to be implemented and that three of them have already been delayed for over 12 months; notes in particular that these delays concern: information security management, the contract renewal process and transparency of decision-making, and filing and archiving policy; calls, therefore, on the Authority to rapidly address these deficiencies, and to inform the discharge authorities of the results achieved;












40.


Draws attention to its recommendations from previous discharge reports, as set out in the Annex to this resolution;












41.


Refers, in respect of the other observations accompanying its Decision on discharge, which are of a horizontal nature, to its resolution of 10 May 2012 (8) on the performance, financial management and control of the Agencies.






(1)  
            OJ C 366, 15.12.2011, p. 106.

(2)  
            OJ L 248, 16.9.2002, p. 1.

(3)  
            OJ L 31, 1.2.2002, p. 1.

(4)  
            OJ L 357, 31.12.2002, p. 72.

(5)  
            OJ L 250, 27.9.2011, p. 162.

(6)  
            OJ L 64, 12.3.2010, p. 991.

(7)  
            OJ L 56, 4.3.1968, p. 1.

(8)  Texts adopted, P7_TA(2012)0164 (see page 388 of this Official Journal).





ANNEX

EUROPEAN PARLIAMENT RECOMMENDATIONS OVER PAST YEARS










European Food Safety Authority


2006


2007


2008


2009




Performance


No risk assessment or defined appropriate performance indicators, or documented systems or internal control procedures governing its activities


n.a.


Calls on the Authority to set SMART objectives and RACER indicators, as well as to make a Gannt diagram → promoting a results-oriented approach








—


Advises the Authority to strengthen the planning and monitoring of budget processes relating to differentiated appropriations










—


Underlines the need for the authority to ensure that its advice is of a high quality and is independent. Recommends measures to further foster and monitor internal rules on declarations of interest by staff or the authority and by experts working for the Authority










—


Requests that the Court of Auditors undertake performance audits on the Authority








Budgetary and financial management/Procurement








—


The annuality principle was not strictly observed: A large number of transfers were made with a high concentration of them at the year-end (31 of the 49 transfers)










—


Weaknesses in the procurement procedures: the selection criteria were not stated; the price-evaluation method not defined till the evaluation procedure was under way; vague description of the quality criteria












—


The annuality principle was not strictly observed: weaknesses in the programming, the programming and the budgeting of the planned activities










—


Weaknesses in the budgetary management: in respect of the contributions given by the Commission to Croatia and Turkey (pre-accession strategy), they should have been treated as assigned revenue in the budget. None the less, they were treated as if they were part of the normal Community subsidy












—


The annuality principle was not strictly observed: weaknesses in programming, monitoring contractual deadlines and the Authority’s budget →






(1)


Calls on the Authority to improve its budget management in order to reduce its carry-over amount: 23 % in 2008; 16 % in 2007; 20 % in 2006;










(2)


A high amount of commitments had to be cancelled (37 % of commitments for operational activities carried over from 2007 and 26 % from 2006)














—


Calls on the Commission to examine ways of ensuring that the principle of needs-based cash management is implemented in full → high cash reserves (EUR 19 990 492,26 )












—


Calls on the Authority to strengthen the budget processes related to its differentiated appropriations and planning and monitoring of its multiannual implementation










—


Urges the Authority it improves its budget management in order to reduce its high carry-over amounts, stresses that the Court of Auditors has flagged up carry-overs of appropriations to the following year, this situation demonstrates weaknesses in the Authority’s contract management and monitoring of the remittance of reports and cots statements










—


Court of Auditors pointed out that commitments for operational activities carried over from the previous year had to be cancelled, urges the Authority to remedy this situation and to notify the Court of Auditors of the measures taken










—


Notes that the Court of Auditors reported difficulties in the implementation of the 2009 work programme, calls on the Authority to take the necessary measures to remedy these deficiencies








Human resources


No realistic recruitment objectives








—


The Authority was able to achieve its recruitment objectives and fill 273 of the 300 posts in its establishment plan: the audit of the recruitment procedures showed that in general neither the weightings of the selection criteria to be applied nor the threshold scores for going on to the next stage of the competitions had been decided upon by the selection board before the deadline fixed in the vacancy notice






n.a.


n.a.




Internal audit


n.a.


n.a.


20 out of the 25 recommendations (80 %) made by the IAS and the IAC have been implemented








—


Is concerned that out of the 48 recommendations, one is considered critical, 27 very important and 20 important but no information has been given to the discharge authority on the content of these recommendations, urges the Executive Director of the Authority to provide this information










—


Reiterates its demand for the Authority to take appropriate measures in cases of conflicts of interest, invites the Authority to initiate a survey of the potential conflicts of interest of its leading scientists, board, and panel members, so that possible omissions in the declarations of interest can be detected and followed by action in a timely manner