Progress: Procedure completed
Role | Committee | Rapporteur | Shadows |
---|---|---|---|
Lead | CONT | SARVAMAA Petri ( PPE) | KADENBACH Karin ( S&D), GERBRANDY Gerben-Jan ( ALDE), STAES Bart ( Verts/ALE), ANDREASEN Marta ( ECR), VANHECKE Frank ( EFD), EHRENHAUSER Martin ( NA) |
Committee Opinion | ENVI | HAUG Jutta ( S&D) |
Lead committee dossier:
Subjects
Events
PURPOSE: to grant discharge to the European Medicines Agency (EMA) for the financial year 2012.
NON-LEGISLATIVE ACT: Decision 2014/591/EU of the European Parliament on discharge in respect of the implementation of the budget of the European Medicines Agency for the financial year 2012.
CONTENT: with this Decision, the European Parliament gives discharge to the Executive Director of the European Medicines Agency for the implementation of the Agency’s budget for 2012.
The Decision is consistent with the European Parliament’s resolution adopted on 3 April 2014 and includes a series of observations that form an integral part of the discharge decision (refer to the summary of the opinion of 3 April 2014).
Amongst the main observations made, Parliament highlighted the failures as regards the legality and regularity of operations , without calling into question its overall management.
The European Parliament adopted a decision concerning the discharge to be granted to the Executive Director of the European Medicines Agency (EMA) in respect of the implementation of the Agency's budget for the financial year 2012. The vote on the discharge decision approved the closure of the accounts (in accordance with Annex VI, Article 5(1) of the Rules of Procedure of the European Parliament.
Noting that the Court of Auditors stated that it has obtained reasonable assurances that the annual accounts of the Agency for the financial year 2012 are reliable, and that the underlying transactions are legal and regular, Parliament adopted by 493 votes to 65, with 20 abstentions, a resolution containing a series of recommendations that form an integral part of the discharge decision and as well as the general recommendations that appear in the draft resolution on performance, financial management and control of EU agencies.
These recommendations are summarised as follows:
Reliability of the accounts - legality and regularity of transactions : Parliament noted that the Agency applies differing recognition criteria for fee revenues and associated expenditure and that the revenue from application fees is recognised on a straight-line basis over a set time period. It also regretted that the Agency has not yet validated its accounting system in the area of intangible fixed assets, which, given the considerable investment in the development of information and communications technology (ICT), is a crucial part of the whole accounting system. It called on the Agency to inform the discharge authority on progress in this regard within the framework of the 2012 discharge follow-up. Parliament also noted with concern that in order to cover higher school fees, the Agency grants staff whose children attend primary or secondary school a top-up allowance, which amounted to some EUR 389 000 in 2012, allowances that may be considered irregular. They acknowledged that this situation is due to the lack of European Schools in the city where the Agency is based. Budget and financial management : Parliament noted that the rate of committed appropriations carried over was high for operating expenses at 27% even though it acknowledged that this relates primarily to the Agency’s planned move to a new premises in 2014 (EUR 4 million) and to the development of ICT systems (EUR 1.6 million). Commitments and carryovers : Parliament took note that the reduced amount carried over to 2013 in comparison with 2010 and 2011 and stated that this is partly related to the new building project. They reminded the Agency of the importance of respecting the budgetary principle of annuality. Prevention and management of conflicts of interests and transparency : Parliament welcomed the fact that for the second year in a row, the Agency held a public workshop on conflicts of interests, aimed at defining the right balance between ensuring the impartiality and independence of experts involved in the Agency's work and securing the best possible scientific expertise. It stated that the Agency revised its policy on the handling of conflicts of interests by the Scientific Committees' members and experts which is expected for endorsement by the Management Board in March 2014. It called on the Agency to present that revised policy to the discharge authority once adopted. Parliament also noted that the Agency works together closely with a variety of patient, healthcare and consumer organisations in order to take their opinions into account; calls on the Agency to request public disclosure regarding the funding of any patient, consumer and healthcare organisation it works with, and to carry out a conflict of interests check regarding those organisations. Performance : Parliament requested that the Agency communicate the results and impact its work has on European citizens in an accessible way, mainly through its website.
Members also made a series of observations on transfers, procurement and recruitment procedures as well as comments on internal controls.
The Committee on Budgetary Control adopted the report by Petri SARVAMAA (EPP, FI) in which it recommended the European Parliament to grant discharge to the Executive Director of the European Medicines Agency (EMA) in respect of the implementation of the Agency's budget for the financial year 2012.
Noting that the Court of Auditors stated that it has obtained reasonable assurances that the annual accounts of the Agency for the financial year 2012 are reliable, and that the underlying transactions are legal and regular, Members approved the closure of the Agency’s accounts. They made, however, a number of recommendations that needed to be taken into account when the discharge is granted, in addition to the general recommendations that appear in the draft resolution on performance, financial management and control of EU agencies.
Reliability of the accounts - legality and regularity of transactions : Members noted that the Agency applies differing recognition criteria for fee revenues and associated expenditure and that the revenue from application fees is recognised on a straight-line basis over a set time period. They also regretted that the Agency has not yet validated its accounting system in the area of intangible fixed assets, which, given the considerable investment in the development of information and communications technology (ICT), is a crucial part of the whole accounting system. They called on the Agency to inform the discharge authority on progress in this regard within the framework of the 2012 discharge follow-up. Members also noted with concern that in order to cover higher school fees, the Agency grants staff whose children attend primary or secondary school a top-up allowance, which amounted to some EUR 389 000 in 2012, allowances that may be considered irregular. They acknowledged that this situation is due to the lack of European Schools in the city where the Agency is based. Budget and financial management : Members noted that the rate of committed appropriations carried over was high for operating expenses at 27% even though they acknowledged that this relates primarily to the Agency’s planned move to a new premises in 2014 (EUR 4 million) and to the development of ICT systems (EUR 1.6 million). Commitments and carryovers : Members took note that the reduced amount carried over to 2013 in comparison with 2010 and 2011 and stated that this is partly related to the new building project. They reminded the Agency of the importance of respecting the budgetary principle of annuality.
Members also made a series of observations on transfers, procurement and recruitment procedures as well as comments on internal controls.
Lastly, they acknowledged that the Agency revised its policy on the handling of conflicts of interests by the Scientific Committees' members and experts which is expected for endorsement by the Management Board in March 2014. They called on it to present that revised policy to the discharge authority once adopted. Members noted that the Agency works together closely with a variety of patient, healthcare and consumer organisations in order to take their opinions into account. They called on the Agency to request public disclosure regarding the funding of any patient, consumer and healthcare organisation it works with, and to carry out a conflict of interests check regarding those organisations.
Having examined the revenue and expenditure accounts for the financial year 2012 and the balance sheet at 31 December 2012 of the European Medicines Agency (EMA), as well as the Court of Auditors' report on the annual accounts of the Agency for the financial year 2012, accompanied by the Agency's replies to the Court's observations, the Council recommends the European Parliament to give a discharge to the Director of the Agency in respect of the implementation of the budget for the financial year 2012.
The observations in the Court of Auditors' report call for certain comments by the Council which can be summarised as follows:
in general, the Council welcomes the Court's opinion that, in all material respects, the Agency's annual accounts present fairly its financial position as at 31 December 2012 and the results of its operations and its cash flows for the year then ended, in accordance with the provisions of the Agency's Financial Regulation and that the underlying transactions for that financial year are legal and regular. Accounting system : notwithstanding this favourable finding, the Council regrets the shortcomings identified by the Court with regard to the Agency's accounting system and urges the Agency to take swift measures to remedy the identified weaknesses. Procurement procedures : the Council also urges the Agency to take actions to remedy the weaknesses found by the Court in the Agency's procurement procedures and to address the weaknesses linked to compliance with the Staff Regulations' provisions regarding payment of education allowances . Carry-overs of appropriations : finally, the Council recalls that, in line with the budgetary principle of annuality, carry-overs should be strictly limited.
PURPOSE: presentation of the EU Court of Auditors’ report on the annual accounts of the European Medicines Agency for the financial year 2012, together with the Agency’s reply.
CONTENT: in accordance with the tasks conferred on the Court of Auditors by the Treaty on the Functioning of the European Union, the Court presents to the European Parliament and to the Council, in the context of the discharge procedure, a Statement of Assurance as to the reliability of the annual accounts of each institution, body or agency of the EU, and the legality and regularity of the transactions underlying them, on the basis of an independent external audit.
This audit concerned, amongst others, the annual accounts of the European Medicines Agency (EMA).
In the Court’s opinion, the Agency’s Annual Accounts fairly present, in all material respects, its financial position as of 31 December 2012 and the results of its operations and its cash flows for the year then ended, in accordance with the provisions of its financial rules and the accounting rules adopted by the Commission’s accounting officer.
The Court also considers that the transactions underlying the annual accounts of the Agency for the financial year ended 31 December 2010 are, in all material respects, legal and regular .
The report confirms that resources made available to the Agency’s in 2012 amounted to EUR 222.5 million.
The report also makes a series of observations on the budgetary and financial management of the Agency, accompanied by the latter’s response. The main observations may be summarised as follows:
The Court’s observations :
reliability of the accounts: the Agency noted that it applies differing recognition criteria for fee revenue and associated expenditure. This is in contradiction with the matching principle. It states that it has not yet validated its accounting system in the area of intangible fixed assets. Given the considerable investment in the ICT development (2012 investments in ICT development amounted to EUR 11.6 million), this is a crucial part of the whole accounting system; staff: in 2011 and 2012, the Council refused salary increases for EU staff. The Commission appealed this decision to the Court of Justice which did not yet rule on the matter. Since the Agency is located in London, the salary increases in question will be paid in GBP whereas the Agency’s accounts are prepared in Euros. Given the fluctuations in the exchange rate over the period concerned, the possible back pay to staff would lead to an estimated exchange rate loss for the Agency of EUR 2.09 million. The Agency has included this amount in the calculation of its budgetary outturn account, leading to an equivalent understatement of funds to be paid back to the Commission; legality of the operations: in 2012, the Agency issued cascading framework contracts for the provision of services. The procurement procedure presented some irregularities affecting the principle of transparency; budgetary management: the rate of committed appropriations carried over was high at 27 %, this primarily relates to the Agency’s planned move to new premises in 2014 (EUR 4 million) and the development of ICT systems (EUR 1.6 million).
The Agency’s response :
reliability of the accounts: in light of the Court’s observation the Agency will review its accounting policy on recognising fee revenue and associated expenditure to ensure future compliance with the matching principle; staff: the Agency states that the amount was included in the Agency's accounts following an instruction from the Accounting Officer of the EU Commission that all unrealised exchange losses should be included in the budgetary accounts as well as the financial accounts. The Agency expects to need this money in order to cover the salaries payable in GBP to EMA staff when the 2011 and 2012 rappels are adopted. The Agency is aware that DG BUDG considers the ‘rappel’ an unforeseeable expenditure, but judges this position to be untenable because the adaptation of exchange rates and weightings which are part of any ‘rappel’ is not only foreseeable, but legally required and long overdue. For the budgetary accounts the Agency applies the same methodology used to calculate the provision in the financial accounts. The Agency's primary concern is that if these figures are not included in the 2012 budgetary accounts it will find itself returning funds to the Commission when in fact those funds will be needed to pay salary liabilities once the weighting and applicable exchange rates are adapted to real levels; legality of operations: the Agency does not share the view of the Court that the principle of transparency was infringed in its tender procedure . It stated that it will make improvements on the issues highlighted by the Court to ensure even greater transparency in the future; budgetary implementation: the Agency noted that it has already substantially reduced its carry over levels as the equivalent carry over in 2011 was 33% and 36% in 2010 (27% in 2012). The Agency strives by respecting its operational requirements to further reduce its carry over to a level within tolerable margins of the Financial Regulation.
Lastly, the Court of Auditors’ report contains a summary of the Agency’s activities in 2012 . This is focused on the following:
applications for marketing authorisations for 96 medicines for human use ; pharmacovigilance activities; mutual recognition procedures and decentralised procedures: started 6991; (ended 6709); scientific advice finalised; applications for paediatric investigation plans: 178 relating to 218 indications; applications for marketing authorisations for 13 medicinal products for veterinary use; 450 inspections; herbal medicinal product studies; 197 applications for orphan medicinal products (139 favourable opinions); requests for SME status: 684 requests and 361 applications for fee reduction or deferrals.
Documents
- Results of vote in Parliament: Results of vote in Parliament
- Decision by Parliament: T7-0316/2014
- Debate in Parliament: Debate in Parliament
- Committee report tabled for plenary: A7-0227/2014
- Amendments tabled in committee: PE521.807
- Document attached to the procedure: 05849/2014
- Committee draft report: PE521.681
- Committee opinion: PE524.566
- Court of Auditors: opinion, report: OJ C 365 13.12.2013, p. 0150
- Court of Auditors: opinion, report: N7-0028/2014
- Non-legislative basic document: EUR-Lex
- Non-legislative basic document: COM(2013)0570
- Non-legislative basic document published: EUR-Lex
- Non-legislative basic document published: COM(2013)0570
- Non-legislative basic document: EUR-Lex COM(2013)0570
- Court of Auditors: opinion, report: OJ C 365 13.12.2013, p. 0150 N7-0028/2014
- Committee draft report: PE521.681
- Committee opinion: PE524.566
- Document attached to the procedure: 05849/2014
- Amendments tabled in committee: PE521.807
Votes
A7-0227/2014 - Petri Sarvamaa - Résolution #
Amendments | Dossier |
29 |
2013/2215(DEC)
2013/12/18
ENVI
9 amendments...
Amendment 1 #
Draft opinion Paragraph 1 1. Notes that in 2012 the European Medicines Agency had resources available of EUR 222.489 000 of which EUR 28.966 000 had been EU budget contributions; likes to stress that this amount represents 0.021% of the overall EU budget; is satisfied that 575 of 590 available posts had been occupied and notes that 160 contract agents and seconded national experts were employed by the end of 2012 which are 17 less than in 2011;
Amendment 2 #
Draft opinion Paragraph 3 3.
Amendment 3 #
Draft opinion Paragraph 3 3.
Amendment 4 #
Draft opinion Paragraph 3 3. Recognises the three comments made by the Court of Auditors which focus
Amendment 5 #
Draft opinion Paragraph 4 4. Reiterates the important role of the Agency in protecting and promoting public and animal health by assessing and supervising medicines for human or veterinary use; welcomes the policy on the handling of conflict of interests, last updated and endorsed by the Management Board in March 2012; welcomes the adoption of the Agency draft policy on publication and access to clinical-trial data.
Amendment 6 #
Draft opinion Paragraph 4 a (new) 4a. Believes that the discharge decision should be based upon OECD guidelines to ensure high quality internationally recognised accounting, audit and financial disclosure standards; invites the European institutions to incorporate and commit to introducing OECD guidelines within a common framework for all European institutions and bodies;
Amendment 7 #
Draft opinion Paragraph 4 a (new) 4a. Believes that the discharge decision should be based upon OECD guidelines to ensure high quality internationally recognised accounting, audit and financial disclosure standards; invites the European institutions to incorporate and commit to introducing OECD guidelines within a common framework for all European institutions and bodies;
Amendment 8 #
Draft opinion Paragraph 5 5. Recommends
Amendment 9 #
Draft opinion Paragraph 5 5. Recommends
source: PE-526.144
2014/02/25
CONT
20 amendments...
Amendment 1 #
Proposal for a decision 1 Paragraph 1 1. Grants the Executive Director of the European Medicines Agency discharge in respect of the implementation of the Agency's budget for the financial year
Amendment 10 #
Motion for a resolution Recital A a (new) Aa. whereas according to its financial statements, the overall contribution of the Union to the Agency's budget for 2012 amounted to EUR 31 341 107.18, representing a decrease of 6, 50 % compared to 2011,
Amendment 11 #
Motion for a resolution Paragraph 4 4. Regrets that the Agency has not yet validated its accounting system in the area of intangible fixed assets, which, given the considerable investment in the development of information and communications technology (ICT), is a crucial part of the whole accounting system; calls on the Agency to inform the discharge authority on progress in this regard
Amendment 12 #
Motion for a resolution Paragraph 8 8. Notes with concern that in 2012, the Agency issued multiple framework
Amendment 13 #
Motion for a resolution Subheading 6 a (new) Prevention and management of conflicts of interests and transparency
Amendment 15 #
Motion for a resolution Paragraph 10 a (new) 10a. Welcomes the fact that for the second year in a row, the Agency held a public workshop on conflicts of interests, aimed at defining the right balance between ensuring the impartiality and independence of experts involved in the Agency's work while securing the best possible scientific expertise;
Amendment 16 #
Motion for a resolution Paragraph 10 a (new) 10a. Looks forward to the revised version of the Agency's conflicts of interests policy; emphasises that the Agency should continue its work to further strengthen its conflicts of interest policy;
Amendment 17 #
Motion for a resolution Paragraph 10 b (new) 10b. Acknowledges that the Agency revised its policy on the handling of conflicts of interests by the Scientific Committees' members and experts which is expected for endorsement by the Management Board in March 2014; calls on the Agency to present its revised policy to the discharge authority once adopted;
Amendment 18 #
Motion for a resolution Paragraph 10 b (new) 10b. Notes that the Agency works together closely with a variety of patient, healthcare and consumer organisations in order to take their opinions into account; calls on the Agency to request the public disclosure of funding information of any patient, consumer and healthcare organisation and to carry out a conflicts of interests check before the Agency involves them in its work;
Amendment 19 #
Performance
Amendment 2 #
Proposal for a decision 1 Paragraph 1 1. Grants the Executive Director of the European Medicines Agency discharge in respect of the implementation of the Agency's budget for the financial year
Amendment 20 #
Motion for a resolution Paragraph 11 a (new) 11a. Requests that the Agency communicate the results and impact its work has on European citizens in an accessible way, mainly through its website;
Amendment 3 #
Proposal for a decision 1 Paragraph 1 1.
Amendment 4 #
Proposal for a decision 1 Paragraph 1 1.
Amendment 5 #
Proposal for a decision 2 Paragraph 1 1.
Amendment 6 #
Proposal for a decision 2 Paragraph 1 1. Approves the closure of the accounts of the European Medicines Agency for the financial year
Amendment 7 #
Proposal for a decision 2 Paragraph 1 1. Approves the closure of the accounts of the European Medicines Agency for the financial year
Amendment 8 #
Motion for a resolution Citation 10 a (new) – having regard to the previous discharge reports of the Parliament;
Amendment 9 #
Motion for a resolution Recital A A. whereas, according to its financial statements, the final budget of the European Medicines Agency (
source: PE-521.807
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