The Parliament approved on Thursday the implementation of the 2022 budget by the Commission, all decentralized agencies and the development funds but postponed the vote on the Council.
Last year, the budget managed by the Council was not granted discharge. This year, the MEPs agreed by overwhelming majority to delay the vote on the Council discharge until the next plenary, awaiting a decision by member states to provide Ukraine with missile protection systems.
The annual discharge debate on the EU budget is a crucial part of the Parliament’s oversight role, to ensure that the budget is spent according to the principles of sound financial management and to hold the EU institutions and agencies accountable. The debate follows the annual audit by the European Court of Auditors (ECA) and the recommendations of the Committee on Budgetary Control.
In fact, the EU budget is seldom free of material errors. The EU auditors were even more concerned about the error rate in 2022 while it continued to single out new risks related to EU funds that have been made available in response to the coronavirus crisis and Russia’s war of aggression against Ukraine.
As in the last four years, the auditors concluded that the level of error was material and pervasive, and have thus issued an adverse opinion on the EU’s spending in 2022. The Parliament is also worried about the growing error rate in the EU budget. This rose in 2022 to 4.2%, up from 3% in 2021 and 2.7% in 2020, prompting MEPs to warn against underestimating the level of risk.
Most of EU’s expenditure is managed by the European Commission, whose budget was approved by the Parliament by 438 votes in favour, 167 against and 5 abstentions. The Parliament drew attention to recurrent problems such as the EU’s outstanding commitments that in 2022 had reached a record-high of €450 billion.
2021 was the first implementation year of the Recovery and Resilience Facility (RRF), to recover from the coronavirus crisis and strengthen Europe’s resilience. However, only one payment was made in 2021 under the facility. In 2022, more payments had been made and the Parliament voiced concern about the alleged COVID-19-related misuse of EU funds in Spain and Czechia.
The Parliament urges the Commission to rely on external auditors if there is a “severe lack of capacity in a member state”, and call for in depth ex-post audits for all contracts awarded without procurement. Echoing the audits by ECA, the Parliament is concerned about member state reporting and control systems for the RRF.
The MEPs regret the “political contradiction” in the Commission decision to disburse previously suspended funds to Hungary in what it calls was an exchange for its endorsement of aid for Ukraine. They also warn the Commission against “watering down” the EU’s climate goals noting that in 2022 the EU fell short of the efficiency needed to achieve the goals set for 2030, 2040 and 2050.
Parliament takes Commission to task
In January, Markus Pieper, a German MEP since 2004 and belonging to the same political party group (European People’s Party, EPP) as the Commission President, was appointed to EU small and medium-sized enterprises (SME) Envoy. According to the Commission’s press release, he will report directly to President Ursula von der Leyen.
The controversial appointment and recruitment process did not escape the attention of the Parliament. In an amendment (35) adopted by 382 votes in favour, 144 against and 80 abstentions, MEPs criticised the politicised process to appoint Pieper as EU’s SME Envoy “despite having been outqualified (...) by the two remaining female candidates from underrepresented member states”.
After questioning whether the principles of merit, gender and geographical balance were taken into consideration and noting “with concern that the successful candidate is an outgoing Member from President von der Leyen’s own German political party”, the Parliament calls on the Commission to rectify the situation by rescinding the appointment and launching a truly transparent and open process for the selection of the EU SME Envoy.
The vote on the amendment followed political party lines with almost all MEPs voting against the amendment belonging to EPP while those voting for it representing the other party groups.
Asked to comment on the amendment at the Commission’s press conference on Thursday, its chief spokesperson Eric Mamer replied that each EU institution is responsible for its own recruitment procedures. The Commission is convinced that it has appointed the right person for the post.
The Commission will reply to the Parliament but judging by the spokesperson’s reply, referring to “institutional autonomy”, it appears that the Commission is above the scrutiny of the Parliament.
In another amendment, the Parliament voiced concerns about “credible reports” that EU money “could have been partially misused” by Hamas and that UNWRA staff could have been involved in terrorist acts. The UN has launched investigation into the allegations but the Commission decided to resume EU funding to UNRWA before the investigations had been finalized.
The MEPs urge the Commission to diversify the recipients of EU support to Palestinian civilians and to include the WHO, UNICEF and the Red Crescent. They also urge the Commission to guarantee independent controls of UNRWA. The fate of the Commission’s own investigation by EU appointed independent experts is still unknown.
M. Apelblat
The Brussels Times
