Select Committee on European Scrutiny Sixteenth Report

8 European Monitoring Centre on Racism and Xenophobia



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.

Legal base
Deposited in Parliament8 December 2006
DepartmentConstitutional Affairs
Basis of considerationMinister's letter of 8 March 2007
Previous Committee ReportHC 41-x (2006-07), para 3 (21 February 2007)
To be discussed in CouncilNot applicable
Committee's assessmentLegally and politically important
Committee's decisionCleared


8.1 The European Monitoring Centre on Racism and Xenophobia (EUMC) was established by Council Regulation (EC) No. 1035/97[15] 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.

The document

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 follows:

  • 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 for this.
  • The Centre had no system for planning and managing its equipment acquisitions.
  • Moreover, there were no cyclical checks on the Centre's inventory.
  • 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 management criteria.
  • 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 price factors.

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

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