8 European Monitoring Centre on Racism
|Report on the annual accounts of the European Monitoring Centre on Racism and Xenophobia for the financial year 2005, together with the Monitoring Centre's replies.
|Deposited in Parliament||8 December 2006
|Basis of consideration||Minister's letter of 8 March 2007
|Previous Committee Report||HC 41-x (2006-07), para 3 (21 February 2007)
|To be discussed in Council||Not applicable
|Committee's assessment||Legally and politically important
8.1 The European Monitoring Centre on Racism and Xenophobia (EUMC)
was established by Council Regulation (EC) No. 1035/97
as a Community body to provide the Community and the Member States
with reliable and comparable information on racism, xenophobia
and anti-Semitism. The European Council decided on 12 and 13 December
2003 to extend the mandate of the EUMC "to make it into a
human rights agency".
8.2 Article 12 of Council Regulation (EC) No. 1035/97
requires the Court of Auditors to examine the Centre's revenue
and expenditure for each financial year and to give its opinion
on the accounts and their reliability.
8.3 In its latest report for the financial year ended
31 December 2005, the Court of Auditors concludes that, in all
material respects, the EUMC's accounts are reliable and that,
in general terms, the transactions underlying the accounts are
legal and regular. The Court has nonetheless chosen to make a
number of additional observations. These can be summarised as
- Over 50% of commitments for
administrative expenditure were carried over to the next financial
year and there was a high rate of cancellation of the appropriations
carried over, showing a need to improve expenditure planning.
- No activity-based management had been brought
in despite the Centre's financial regulation making provision
- The Centre had no system for planning and managing
its equipment acquisitions.
- Moreover, there were no cyclical checks on the
- The Centre's internal control system suffered
from various other shortcomings which include the inadequate application
of the principle of segregating duties and ex ante financial
- Selection boards were not always of a grade equivalent
or higher than that of the post to be filled.
- Invitations to tender contained insufficient
information on the minimum quality of bids and the weighting of
The Court's report contains the Centre's replies
to these observations. On the composition of selection boards,
the Centre explains that, with its relatively small workforce,
it was not always possible to constitute boards of a higher grade.
The Court also reports that the Centre had undertaken to improve
the clarity of information provided in calls for tender.
8.4 When we first looked at this report last month
we expressed concern about the Centre's past financial and organisational
shortcomings and asked the Minister to explain why the government
was confident in the light of the centre's performance so far
that its planned expansion into the EU human rights agency would
go hand in hand with an improvement in the organisation's financial
performance and accountability.
The Minister's letter
8.5 The Parliamentary Under Secretary of State (Baroness
Ashton of Upholland) has now written to us. In her letter of 8
March she comments as follows:
"Thank you for your 10th Report of 6 March
2007 in which you asked the Government whether it is confident,
in the light of the performance of the European Monitoring Centre
on Racism and Xenophobia (EUMC), that the future Fundamental Rights
Agency will be able to discharge its extended remit in a satisfactory,
financially prudent and accountable manner. I am replying as Minister
for Human Rights.
"I believe that the Regulation establishing
the Fundamental Rights Agency has fully taken into account the
experience of the EUMC and the conclusions and recommendations
of the independent evaluation of the EUMC carried out in 2002,
particularly the need to clarify the main objective of the Centre,
reorganise the management structure to include a Scientific Committee,
establish a multi-annual plan together with annual work plans
and regularly to review the allocation of the financial resources.
"The Fundamental Rights Agency will have
a single main objective, that of providing assistance and expertise
to EU Institutions and, when implementing Community law, to Member
States on fundamental rights issues within Community law. A Scientific
Committee will be established alongside the Management Board,
the Executive Board and the Director, to ensure the scientific
quality of the Agency's reports. A five-year Multi-annual Framework
adopted by the Council will determine the broad areas of work
of the Agency while an Annual Work Programme adopted by the Management
Board will focus on the Agency's annual priorities in accordance
with the Multi-annual Framework. Finally, a robust monitoring
system will be established to oversee the Agency's budget and
financial undertakings. The activities of the Agency will be supervised
by the European Ombudsman and the European Court of Auditors will
continue to produce regular reports on the Agency's budget. The
European Anti-Fraud Office and the European Court of Auditors
will also have the power to conduct investigations and carry out
checks on the Agency's funding and the staff responsible for allocating
it. Finally, by 31 December 2011, the Agency itself will commission
an independent external evaluation of its activities.
8.6 We thank the Minster for her quick reply to
the concerns raised in our original report. We find it difficult
to share the Minister's confidence that the promised adjustments
in the financial management and accountability at the Centre will
equip the future Fundamental Rights Agency to discharge its functions
in a generally satisfactory and financially prudent manner.
8.7 We have no further questions to the Minister
and are content to clear the document, but will keep a close eye
on the Agency's future performance.
15 OJ No. L 151, 10.6.97, p.1. Back