OBJECTIVE: granting of discharge for implementing the EU’s general budget for 2003 – Economic and Social Committee.

LEGISLATIVE ACT : Decision 2005/535/EC of the European Parliament concerning the discharge for implementing the general budget of the EU for the 2003 financial year (Section VI– Economic and Social Committee).

CONTENT: With this Decision, the European Parliament grants discharge to the Economic and Social Committee for the implementation of the budget for the 2003 financial year.

This decision is in line with the European Parliament’s resolution adopted on 12 April 2005 and comprises a series of observations that form an integral part of the discharge decision (please refer to the summary of the opinion of 12/04/2005).

The European Parliament adopted a resolution drafted by Alexander STUBB (EPP-ED, FI) g ranting the

Secretary-General of the European Economic and Social Committee discharge in respect of the implementation of the budget for the 2003 financial year. (Please see the summary of 17/03/2005.) The European Economic and Social Committee (EESC) administered a budget of EUR 81 166 960, of which 98.12 % had been committed and 92.77 % spent by 31 December 2003.

With further regard to the travel reimbursement rules, Parliament noted that the European Anti-Fraud Office (OLAF) has completed an investigation into allegations concerning the possible misuse of the committee's travel reimbursement scheme by a member. OLAF has found evidence of "double reimbursement" and forwarded its findings to the Belgian public prosecutor. Throughout the investigation the EESC fully co-operated with OLAF. The latter did not question the EESC's financial management system.

The European Parliament adopted a resolution drafted by Alexander STUBB (EPP-ED, FI) g ranting the

Secretary-General of the European Economic and Social Committee discharge in respect of the implementation of the budget for the 2003 financial year. (Please see the summary of 17/03/2005.) The European Economic and Social Committee (EESC) administered a budget of EUR 81 166 960, of which 98.12 % had been committed and 92.77 % spent by 31 December 2003.

With further regard to the travel reimbursement rules, Parliament noted that the European Anti-Fraud Office (OLAF) has completed an investigation into allegations concerning the possible misuse of the committee's travel reimbursement scheme by a member. OLAF has found evidence of "double reimbursement" and forwarded its findings to the Belgian public prosecutor. Throughout the investigation the EESC fully co-operated with OLAF. The latter did not question the EESC's financial management system.

EP: decision of committee responsible, 1st reading/single reading

The committee adopted the report by Alexander STUBB (EPP-ED, FI) granting discharge to the Economic and Social Committee (ESC) for the 2003 financial year. In its accompanying remarks, the committee welcomed the fact that a new personnel management and payroll system had been put in place and that the ESC had, albeit belatedly, abolished the imprest account for the payment of members' allowances in early 2004. It was critical of the fact that, despite the ESC's public assurance during last year's discharge procedure that there had been no further irregularities regarding the settlement of travel expenses, the Court of Auditors had uncovered cases of excessive travel allowance payments to members. It noted, however, that the ESC, in the meantime, had clarified the travel reimbursement rules.

With regard to the follow-up of the 2002 discharge procedure, the committee noted that an internal auditor's report did not reveal any acts of fraud as far as the Belliard building was concerned and indeed recognised "the value of the building project for the Committees".

The committee called on the ESC to further improve its public profile as a body representing civil society and to use benchmarking means with a view to achieving measurable progress. Lastly, it asked the ESC to evaluate the implications of the new Financial Regulation for its administrative and political work in time for its review in 2005/2006.

PURPOSE : to present the report from the Court of Auditors on the implementation of the budget for the financial year 2003 (Other institutions – Economic and Social Committee).

CONTENT : in its 27 th Annual Report on the 2003 financial year, the Court states that, on the whole, the institutions have made a considerable effort to adapt their supervisory systems and controls to the requirements of the new Financial Regulation. Nevertheless, most of them have not succeeded to implement the changes necessary and weakness have been stated in terms of the legality and regularity of the underlying transactions. These discrepancies do not however jeopardise the positive character of the State of Assurance (DAS) on the implementation of the budget for the other institutions.

Concerning the expenditure, the Court highlights that there were no significant discrepancies. It does note that the new supervisory systems and controls should have been better applied by all the institutions in order to respect the rules of the new Financial Regulation.

It should be noted that in 2003, the authorising officers by delegation have presented for the first time annual activity reports which provide very useful information on the working of the control systems. The Court would like these report to be more comprehensive so that they can be used in the framework of the annual DAS.

More specifically, as regards the execution of the ESC’s budget, the Court highlights some difficulties in the application of control standards. Other shortcomings have been identified in the area of procurement. Moreover, for staff remunerations, the Court identified weaknesses. Pe rsonnel data were input manually and separately in both the personnel database and the payroll system. As there was no computer link between the two systems, an automatic reconciliation of data was not possible.

Other discrepancies have been identified on the issue of travel expenses. In three cases, the travel allowance paid to Members of the Economic and Social Committee was twice the amount set out in the Committee’s own rules. These cases concerned flights from Berlin to Brussels, whose scheduled duration was less than or equal to one and a half hour. The Committee’s rules lay down that a double travel allowance is paid for travels by plane lasting more than one and a half hours. It appeared from the audit that the rules were generally not being complied with when the journey had started in Berlin and some other cities.

Lastly, the Court highlighted a certain number of weak points in the control systems for most budget lines with regard to the application of the new Financial Regulation.

PURPOSE : to present the revenue and expenditure account and the balance sheet concerning the activities of the budget for the financial year 2003 (Economic and Social Committee).

CONTENT : this document sets out the amount of expenditure and the balance sheet for the other institutions of the Union (except the Commission) for the financial year 2003, in particular, the Economic and Social Committee.

The ESC’s 2003 budget amounted to EUR 81 million with 98.1% being committed. The implementation of the budget was marked by the following elements:

- implementation of 4 priority policies : to optimise the role of the consultative body of the Committee within the European Parliament, the Council and the Commission; to improve the representativeness of the ESC as a representative of the civil society; strengthen the presence of the ESC in the debate on the future of Europe; develop the internal structures of the Committee;

- aiming to improve the ESC’s services, to reinforce its working methods and its cooperation with other institutions, to cooperate with the Committee of the Regions;

- on an operational level : 2003 was marked by the continuation of the work of the Committee which delivered 190 opinions (against 172 in 2002). Other salient issues can be summarized as follows: the development of interinstitutional cooperation, notably with the EP; the participation in the debate on the future of Europe; the preparation of enlargement; the strengthening of its communication, services offered to the Members and the modernization of its internal workings (in particular, in respect of the requirement of the new Financial Regulation).

The Committee highlighted that following the demands of the budgetary authority an amount of EUR 2 million was released in 2003 with a view to paying the ground rent for the "Belliard 97" building. The ESC stated that it concluded a new rent contract with the Committee of the Regions for the "Belliard 68" building to be taken account of in 2004.

Lastly, the Committee equally improved its accounting system and updated its inventory of its assets as was requested by the Court of Auditors.

PURPOSE : to present the revenue and expenditure account and the balance sheet concerning the activities of the budget for the financial year 2003 (Economic and Social Committee).

CONTENT : this document sets out the amount of expenditure and the balance sheet for the other institutions of the Union (except the Commission) for the financial year 2003, in particular, the Economic and Social Committee.

The ESC’s 2003 budget amounted to EUR 81 million with 98.1% being committed. The implementation of the budget was marked by the following elements:

- implementation of 4 priority policies : to optimise the role of the consultative body of the Committee within the European Parliament, the Council and the Commission; to improve the representativeness of the ESC as a representative of the civil society; strengthen the presence of the ESC in the debate on the future of Europe; develop the internal structures of the Committee;

- aiming to improve the ESC’s services, to reinforce its working methods and its cooperation with other institutions, to cooperate with the Committee of the Regions;

- on an operational level : 2003 was marked by the continuation of the work of the Committee which delivered 190 opinions (against 172 in 2002). Other salient issues can be summarized as follows: the development of interinstitutional cooperation, notably with the EP; the participation in the debate on the future of Europe; the preparation of enlargement; the strengthening of its communication, services offered to the Members and the modernization of its internal workings (in particular, in respect of the requirement of the new Financial Regulation).

The Committee highlighted that following the demands of the budgetary authority an amount of EUR 2 million was released in 2003 with a view to paying the ground rent for the "Belliard 97" building. The ESC stated that it concluded a new rent contract with the Committee of the Regions for the "Belliard 68" building to be taken account of in 2004.

Lastly, the Committee equally improved its accounting system and updated its inventory of its assets as was requested by the Court of Auditors.