Documents considered by the Committee on 9 December 2009 - European Scrutiny Committee Contents


2 Financial management

(31051)

14998/09

+ ADD 1

COM(09) 526

Commission Report on the follow-up to 2007 Discharge Decisions (Summary): European Parliament Resolutions drafted pursuant to Article 276(3) of the EC Treaty and Article 180b of the Euratom Treaty, Article 147 of the Financial Regulation and Article 119(5) of the EDF Financial Regulation

Legal base
Document originated16 October 2009
Deposited in Parliament28 October 2009
DepartmentHM Treasury
Basis of considerationEM of 16 November 2009
Previous Committee ReportNone
To be discussed in CouncilNot known
Committee's assessmentPolitically important
Committee's decisionFor debate in European Committee B, together with the European Court of Auditors' Annual Report for 2008, once available, and other relevant documents

Background

2.1 Each annual audit of the Community's general and other budgets by the European Court of Auditors is concluded by a discharge given to the Commission by the European Parliament on the recommendation of the Council. But the Commission is required to act on and report back on any observations made by the European Parliament in the discharge decisions and any comments accompanying the Council's recommendation. Any results from action on, and follow-up to, observations, comments and recommendations feed into subsequent annual audits.

The document

2.2 This document is a summary report from the Commission about its follow-up to the European Parliament's Resolutions in its Discharge Decisions in relation to the 2007 budget. The summary is in three parts dealing with recommendations on:

  • the General Budget, including both horizontal and sectoral issues and European Court of Auditors' special reports;
  • the European Development Funds; and
  • requests in the resolutions concerning the agencies.

2.3 The summary cross-refer to the Commission's annexed staff working document, which gives a much more detailed account of the Commission's responses to the European Parliament's recommendations under several headings:

  • main conclusions;
  • the Statement of Assurance;
  • budgetary management — financial corrections, amounts recovered and suspension of payments;
  • annual summaries of audits and declarations available in the shared-management field and national declarations (by Member States in relation to their management of Community funds);
  • control systems;
  • transparency;
  • the Financial Regulation;
  • the European Anti-Fraud Office (OLAF);
  • own resources;
  • agriculture and natural resources;
  • fisheries subsidies;
  • cohesion;
  • internal policies;
  • external actions;
  • non-governmental organisations;
  • development;
  • pre-accession strategy;
  • administrative expenditure;
  • follow-up measures in the light of the discharge;
  • eleven special reports;
  • the European Development Funds; and
  • requests in the resolutions concerning the agencies.

The Government's view

2.4 The Economic Secretary to the Treasury (Ian Pearson) says:

    "This report provides a useful summary of the action taken by the Commission in response to the recommendations of the Council and the European Parliament on discharge of the 2007 EC Budget. These actions should lead to improvement in the management of the budget. Nevertheless, considerable further effort is required by all concerned, notably the Commission and Member States, to continue in their efforts to improve financial management if the European Court of Auditors is to provide a positive Statement of Assurance on the EC budget.

    "Looking forward, the Government will continue to engage actively with the Commission to encourage further progress in areas such as effective simplification, and in evaluating the results of those measures taken so far. In the area of tolerable risk, the Government will consider any future Commission proposals in line with the approach set out in [the Government's Explanatory Memorandum of 9 February 2009 on the Commission Communication Towards a common understanding of the concept of tolerable risk of error.][5]

    "The Commission considers action at Member State level to be central to improving the level of assurance on EU expenditure. HM Treasury published the second Consolidated Statement, and accompanying NAO Audit Opinion, on the use of EU funds in the UK, in October 2009.[6] The Government will continue to work closely with others to encourage other Member States to undertake similar initiatives."

Conclusion

2.5 This document usefully summarises Commission attempts to improve management of the Community's finances. As such we recommend that it should be debated together with the Commission's 2008 report on the fight against fraud, which we have already recommended for debate in European Committee,[7] and with the 2008 report of the European Court of Auditors, on which we expect to be reporting early in the New Year.


5   (30320) 17592/08 + ADD 1: see HC 19-viii (2008-09), chapter 8 (25 February 2009) and HC 19-xxvii (2008-09), chapter 33 (14 October 2009). Back

6   See http://www.hm-treasury.gov.uk/d/statement_eufunds151009.pdf.  Back

7   (30811) 12139/09 + ADDs 1-2: see HC 19-xxvii (2008-09), chapter 2 (14 October 2009). Back


 
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Prepared 17 December 2009