FIRST ROUND OF QUESTIONS
“Progress” is a word you often here at this time of the year. I have been Member of Parliament since 2004 and each year at this time you here that the Commission is “making progress” and “on the right track”.
In the same breath, the Commission also ensures that current weaknesses will be remedied in the next period and in the next set of regulations.
At the beginning of my career as Member of this House I found it very assuring.
I was happy to know that the Union’s manager – the Commission which has final responsibility for the implementation of the budget – was confident that things would be better
But then, having heard the same tape for some years, at some point I realised that the Commission’s way of speaking seems open-ended.
The Commission is making fantastic progress every year, but even so: we never get there; we never achieve the objective. What we want is always ahead of us.
Mr. Chairman, this year the Commission believes it is making progress even if – according to the Court – the situation remains stable:
“overall the supervisory and control systems are still only partially effective”
“payments underlying the accounts for the year ended 31 December 2010 are still materially affected by error”.
The fact that the Commission is able to turn the Court’s message of a stable situation into something positive by labelling it “progress” sounds a bit too optimistic to me…
In my view stable is no progress and – as I mentioned before – it is not good!
Chairman, I now come to my detailed questions. And at this stage I would like to raise questions of five different topics:
1. Audit and DG REGIO
Commissioner Semeta, you are the Commissioner responsible for “audit”.
Do you consider yourself co-responsible together with Commissioner Hahn for reducing the error rate of 7,7% in Cohesion Policy?
Do you have any influence on DG REGIO’s way of implementing the budget?
Can DG REGIO do whatever they want to or do you – as Commissioner responsible for audit – have a word to say on their instruments?
If you have a word to say: is it BIG enough?
Let’s say that DG REGIO has invented something which gives Member States a lot of flexibility and DG REGIO good possibilities for disbursing the budget.
On the other hand, you come to the conclusion that from an audit and accountability point of view the thing invented by DG REGIO is a bit risky.
What is your responsibility in such a situation?
What is the responsibility of the Commissioner for DG REGIO?
Is there a common understanding on each one’s area of responsibility?
2. Financial engineering instruments
Financial engineering instruments play a prominent role in the Court’s findings for 2010 and I welcome the Court’s efforts in this area.
In the Commission’s analysis of errors in Cohesion Policy financial engineering instruments are considered “high risk”.
Could you please explain why FEIs are going to be used more frequently in the next Multi-annual financial framework if they are “high risk” instruments?
Furthermore, please tell us which other policy areas are affected by FEIs as mentioned by the Court and to what extent?
3. Reliability of Commission’s management representations
I would like to thank the Court for putting a focus on
• the Annual Activity Reports,
• the Synthesis Report of the Commission and
• now the new Opinion of the Commission’s Internal Auditor.
These are important accountability instruments which need to be closely scrutinised by the Court so that we MEPs can have trust in them.
And it is worrying what I read:
Firstly, the Commission has no guidance on how to estimate its own error rate.
Or should I say each Director-General can do what he wants to and apparently – to put it mildly – estimates with a lot of optimism?
The Court’s conclusion is: There should have been more reservations. What is yours Mr. Semeta?
Secondly on the opinion of the Commission’s internal auditor:
I have not seen it. Mr. Semeta how useful can it be if it is not published?
The Court tells us that the scope of the opinion is limited to the Commission’s own internal control framework although everybody knows that more than 90% of all errors are identified outside the Commission.
Again, Mr. Semeta, how useful can this opinion be?
My conclusion at this point is that without a substantial revisit addressing the Court’s observations, there is no need for this overall opinion.
4. Increased use of Pre-financings
The term ‘pre-financing’ does not sound like a word politicians can get excited about, but reading what the Court has said made me curious.
The Commission is taking an increased risk by paying out an increased proportion of pre-financings. The justification for these payments comes later – sometimes many years later.
I believe the Lifelong Learning Programme with advance payments of up to 100% per project and 93% of all payments made in 2010 being advance payments is the most depressing example.
Mr. Semeta, please tell me why the Commission wants to take this increased risk? And how do you mitigate this risk?
Was one of the considerations also because a high volume of pre-financings lowers the error rate of the Court as evidenced in the policy areas Internal Policies and External Aid?
5. The financial crisis and the EU Budget
Mr. Semeta, as I already pointed out before, I would like to understand how the EU Budget is exposed to financial risk deriving from the financial crisis affecting Member States.
In your view, where is the EU Budget exposed to such risk?
Which steps do you take to mitigate these risks?
With reference to the table given as answer to the first written question, the total outstanding amounts as of 31 december 2010 were 14,274 billion euro. Which measures has the commission taken to manage the financial risk in relation to this outstanding amount?
SECOND ROUND OF QUESTIONS
RESPONSE TO THE EXPLANATIONS GIVEN BY COURT/COMMISSION OR REPITITION OF QUESTIONS LEFT UNANSWERED
Thank you very much Mrs. Kaljulaid and Commissioner Semeta for your explanations.
I fear that we have to – once again – put all our hopes into the next programming period.
I am asking myself whether the Commission has carefully considered the risk of continued high error rates in Structural funds in the 2014 – 2020 period?
As you are aware, this time the legislative procedure will be different. The Lisbon Treaty has given Parliament full co-decision power for the legislative packages for the Cohesion and Agricultural policies.
I hope Commissioner Semeta that we can count on your full support so that we do not sit here in seven years, listening to you or to your successor explaining to us
- that “progress” has been made and
- that the Commission will ensure that weaknesses will be remedied in the 2021 – 2027 period.
Thank you very much.