14 European External Action Service:
personnel and financial management
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(32065)
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(b)
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14677/10
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Draft Regulation amending the Staff Regulations of officials of the European Communities and the conditions of employment of other servants of those Communities
Draft Regulation amending Council regulation (EC, Euratom) No 1605/2002 on the Financial Regulation applicable to the general budget of the European Communities, as regards the European External Action Service
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| Legal base | (a) Article 336 TFEU; co-decision; QMV
(b) Article 322 TFEU and Article 106a Euratom Treaty; co-decision; QMV
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| Deposited in Parliament | (a) —
(b) 20 October 2010
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| Department | Foreign and Commonwealth Office
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| Basis of consideration | Minister's letter of 19 October 2010
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| Previous Committee Report | HC 5-xvii (2009-10), chapter 2 (7 April 2010)
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| To be discussed in Council | Late October/early November 2010
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
14.1 Management of the EU's staff and financial resources is governed
by the Staff Regulations and the Financial Regulation.
14.2 Amongst matters covered by the Financial Regulation
are budgetary principles, establishment, structure and implementation
of the budget, procurement, accounts, external audit and discharge
by the European Parliament. The Financial Regulation is complemented
by detailed Implementing Rules adopted by the Commission.[53]
14.3 The Council Decision on the organisation and
functioning of the European External Action Service[54]
(EEAS) requires amendments to the Staff and Financial Regulations
before it can become operational.
Previous scrutiny
14.4 In April of this year[55]
the previous Committee recommended that the proposed amendments
to the Staff and Financial Regulations, although not finalised,
be debated on the Floor of the House. The debate took place on
14 July, and both amending Regulations were subsequently cleared
from scrutiny.
The Minister's letter of 19 October
14.5 Further negotiations on the two proposals have
now taken place in Brussels and the Minister for Europe (David
Lidington) writes to update the Committee on progress made. He
says that both proposals remain largely unchanged from the ones
scrutinised earlier this year; and whilst there is not yet a final
position, he expects the proposals to be adopted by the European
Parliament during this week's plenary in Strasbourg (18-20 October).
The Presidency and High Representative are then likely to seek
adoption by the Council, possibly as early as 25 October at the
General Affairs Committee/Foreign Affairs Committee (or otherwise
as an "A" Point at a Council in early November). The
Minister says he will make every effort to delay the Council decision
for as long as possible, but asks for our early response to the
proposals in case adoption is scheduled for 25 October.
14.6 The Minister explains that the High Representative,
Baroness Ashton, is keen to see the Regulations adopted quickly.
She wants to appoint her top team by early November to help
her manage the growing number of foreign policy challenges on
her plate (e.g. Western Balkans, Pakistan, Iran) but is reluctant
to do this until the proposed amendments to the Staff Regulations
have been adopted.
14.7 The Government agrees that prolonged internal
wrangling over structures and appointments risks distracting attention
from the larger challenge of increasing the EU's impact on external
policy issues of shared concern. Serious discussion and agreement
of EEAS policy priorities is overdue, but remains difficult without
the top team in place.
14.8 The Government is concerned that a credible
plan to achieve cost efficiencies in the short-term, and budget
neutrality in the longer term, must be put in place as quickly
as possible. Baroness Ashton wants this work to be led by the
EEAS' Chief Operating Officer (COO), who will be appointed along
with the rest of the top team. Until the proposed amendments to
the Financial Regulation are adopted, the EEAS does not have the
authority to spend EU budget funds and the Commission and Council
are therefore making disbursements on the EEAS' behalf. The Government
would like to see the amendments finalised, and the COO appointed,
to enable rapid progress to be made on a plan for cost savings
and eliminating duplication.
THE STAFF REGULATION
14.9 A compromise text has now been reached following
trilogue negotiations between the European Parliament (EP), Commission
and Council. There were three particular points of contention.
Gender balance and geographical balance
14.10 The EEAS Decision states that candidates should
be appointed 'on merit, while ensuring adequate gender and geographical
balance'. MEPs had tabled amendments stating that: 'candidates
from the less represented Member States and the less represented
gender may be given priority, provided they have substantially
similar qualifications'. The Government agreed with the Presidency
that this demand should be resisted firmly. The revised text does
not include provision for positive discrimination, but does include
two Statements by the High Representative, (Addenda 1 and 2) undertaking
to seek opportunities to improve representation, within the provisions
of the Regulations.
Date of opening-up of vacancies to other institutions
14.11 The EEAS Decision states that 'before 1 July
2013, the EAS will recruit exclusively officials originating from
the General Secretariat of the Council and the Commission, as
well as staff coming from the diplomatic services of the Member
States'. The EP wanted to bring this date forward, as that would
allow its own staff to apply for EAS vacancies, but was not successful
14.12 A related point was on the transitional period
during which priority may be given to candidates from Member States
in case of substantially equal qualifications (in order to meet
the one-third target). Here the EP was unsuccessful in shortening
this period from 1 July 2013 to 1 January 2012.
Modalities of application of Article 29 of the
Staff Regulations
14.13 The EP successfully effected a change to Article
29, to allow its own staff (and those from other institutions)
to be treated as internal candidates from the date of their eligibility
to apply for EEAS vacancies. The Government did not favour this,
but agreed that a concession on this point was acceptable in order
to defend our position on the points mentioned above.
THE FINANCIAL REGULATION
14.14 The EEAS requires a revision to the Financial
Regulation in order to be able to spend EU budget funds, and to
ensure that the correct financial management arrangements are
in place. The negotiations on this in Council were relatively
straightforward, technical in nature and largely followed the
steer laid down in the EEAS Decision. The Presidency was given
a strong mandate by COREPER to defend the original proposal against
further amendments by the EP. On 12 October, the Presidency circulated
the compromise text for agreement by COREPER. The Government is
satisfied that the Presidency followed the mandate from the Council
and successfully held their ground on three of the four outstanding
points, as set out below.
Liability of temporary staff coming from diplomatic
services
14.15 The EP wanted controls on seconded national
experts (SNEs) to be tighter. The Presidency believed this was
unnecessary. It was agreed that Article 66 of the Financial Regulation
covers all eventualities, and more controls were therefore not
required.
Member State expenditure under CFSP
14.16 The EP wanted more detailed information on
how CFSP funds are spent. The Presidency argued that the EP had
no right to be involved in cooperation that occurs under CFSP
between Member States (under the 'Athena' mechanism). The Government
strongly disagreed that the EP should have any such role, and
fully supported the Presidency's firm stance on this point. There
are some changes to the final compromise text, which reflect the
way information on CFSP spending is presented, but the Government
does not consider them to be substantive.
The Discharge Procedure
14.17 The EP wanted Heads of Delegation to be accountable
to the EP under the annual discharge procedure. The Presidency
believed this breached the Financial Regulation: the line of accountability
lies with Director Generals, and ultimately the High Representative,
not with Heads of Delegation. The Council fought consistently
against attempts by the EP to have specific rights of control
over Heads of Delegation. This point was successfully defended
by the Presidency.
EAS Internal Auditor
14.18 The Council wanted an independent EEAS internal
auditor, on the grounds that all other Institutions have one,
and that they consider it to be generally good financial management.
The EP (and the Commission) wanted the EEAS to use the Commission
auditors, which would be more cost effective — especially
as the Commissioner auditors will still need to audit most of
the operational expenditure flowing through EU Delegations around
world. An EEAS auditor would, in effect, only be auditing administrative
spend, which is low risk.
14.19 The Government did not consider this a priority:
provided that there is a transparent and effective audit process
it would prefer to see the best value for money solution implemented,
and was content for the Presidency to cede to the EP on this point.
14.20 A final outstanding point is that the Commission
has adopted a declaration as part of the trilogue agreement stating
that it will address the issue of integrating the European Development
Fund into the EU Budget. Such a budgetisation of the Fund would
require unanimity in the Council. We and many other Member States
would oppose.
Conclusion
14.21 We thank the Minister for this update on
the inter-institutional negotiations on the revision to the Staff
and Financial Regulations, which is necessary for the operation
of the European External Action Service (EEAS). And we are grateful
to have been able to consider the amendments before final political
agreement in the Council.
14.22 It would appear that the European Parliament
exercised its co-decision rights to increase its influence over
the operation of the EEAS; but, on balance, we think the compromise
text is one which is rational, financially sound, and which preserves
the sui generis nature of the EEAS and the CFSP.
14.23 We clear both proposals from scrutiny, and
ask for the final versions of both proposals to be deposited when
they become available.
53 Commission Regulation (EC, EURATOM) No 2342/2002:
see http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2002:357:0001:0071:EN:PDF.
Back
54
Reported at chapter 11 of this Report. Back
55
See headnote. Back
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