Brussels, 31/10/2001 (Agence Europe) - As announced in EUROPE of 29/30 October, p.14), on Tuesday the European Commission adopted an amendment of its proposal for the overhaul to he EU's "financial bible", the Financial Regulation applicable to the general budget of the European Communities by setting out in a single legal instrument all the principles and basic rules concerning the establishment, implementation and control of the budget. The proposal takes the form of a working document, which will be presented as an amended proposal once Parliament has given its formal opinion. The amended proposal then requires unanimous approval by the Council, after conciliation with Parliament if this is requested. The Gothenburg European Council set 2002 as the target year for the adoption of the new Financial regulation.
Apart from the changes EUROPE has already reported on, the following changes are key:
- The budget's structure. The Commission does not agree with the EP (which asked for the option of creating a reserve to cover the unexpected in the Commission's section of the budget), arguing that the SAB (Supplementary and Amending Budget) suffices and that it was not a good idea to include as political mechanisms as the financial perspectives in the Financial Regulation.
- Implementing the budget. In order to introduce more discipline into the implementation of the budget, the Commission has set the deadline of 31 December of the year n+1 for the implementation of global commitments. This is extended to 31 December +3 for external aid to allow for the distances involved and the need for a third country to be involved. The Commission has accepted most of the other institutions' suggestions. In an opinion published on the initial proposal in March 2001, the Court of Auditors called for clarification of the responsibilities at all stages in the implementation of the budget, and the adoption of a provision stating that the Commission is always responsible for its implementation. The EP asked the Commission to indicate which tasks (and under what conditions) could be delegated to other agencies. The Council asked for a ban to be incorporated on the exercise of public authority tasks by private bodies. In terms of accounting and presenting the accounts, the Commission followed the Council's suggestion (wanting accounts to reflect the real costs of each of the Communities' activities) and the also the Court's (asking for the Commission to clear up the lack of precision on the accounting framework and methods that had been selected). It also agreed to bring the timetable for the presentation of the account forward by a month (to 31 March of the following year instead of 1 May) thereby enabling the discharge authority to begin work earlier.
- External control and discharge. Despite the criticisms from the Court of Auditors, the Commission has kept its proposal to devote a specific element of the Financial Regulation to external control and welcomes the other institutions' views (favouring keeping a section on discharge).
The proposal transposes the Directives on public procurement into the Financial Regulation, along with the framework for preventing fraud, irregularities and corruption whereby people guilty of fraud or corruption can be excluded from a call for tender procedure. On grants, the proposal incorporates into the Financial regulation the basic principles of transparency, programming, co-financing, collective assessment and control already contained in the Commission's vademecum on grant management.
