PURPOSE: to grant discharge to the European Economic and Social Committee for the financial year 2016.

NON-LEGISLATIVE ACT: Decision (EU) 2018/1329 of the European Parliament on discharge in respect of the implementation of the general budget of the European Union for the financial year 2016, Section VI — European Economic and Social Committee.

CONTENT: the European Parliament decided to grant discharge to the Secretary-General of the European Economic and Social Committee in respect of the implementation of the budget of the European Economic and Social Committee for the financial year 2016.

This decision is accompanied by a resolution of the European Parliament containing the observations which form an integral part of the discharge decision in respect of the implementation of the general budget of the European Union for the financial year 2016 ( please refer to the summary dated 18.4.2018 ).

Parliament welcomed the Committee’s overall prudent and sound financial management in the 2016 budget period while expressing support for the successful paradigm shift towards performance-based budgeting in the Commission’s budget planning.

In 2016, the Committee’s budget amounted to EUR 130 586 475 , with a utilisation rate of 97.55 %.

Parliament asked the Committee to provide the discharge authority with a cost-benefit assessment of the missions for the Union and visited countries, and the list of the visited countries in 2016. It encouraged the adoption of appropriate measures in order to make savings and reduce environmental pollution.

Parliament proposed a joint assessment of the budgetary savings resulting from the cooperation between the Committee and Parliament is of interest to both institutions and to Union citizens. It welcomed the administrative cooperation agreement between the Committee and the Committee of the Regions, which entered into force in 2016.

It expressed the need to establish an independent disclosure, advice and referral body with sufficient budgetary resources, in order to help whistleblowers and called on the Committee to improve its harassment policy in order to further prevent any form of psychological and sexual harassment.

The European Parliament decided by 560 votes to 130, with 4 abstentions, to grant discharge to the Secretary-General of the European Economic and Social Committee in respect of the implementation of the committee’s budget for the 2016 financial year.

Members welcomed the conclusion of the Court of Auditors, according to which the payments as a whole for the year ended on 31 December 2016 for administrative and other expenditure of the committee were free from material error . No significant weaknesses were identified in respect of the audited topics relating to human resources and procurement.

However, the Members stressed that the discharge procedure needs to be streamlined and sped up. They requested that the CJEU and the Court of Auditors follow best practice in the private sector and proposes in this regard to review the timetable for the discharge procedure so that the vote on the discharge would take place in Parliament’s plenary part-session in November, thereby closing the discharge procedure within the year following the accounting year in question.

Financial and budgetary management: Members welcomed the overall prudent and sound financial management of the Committee in the 2016 budget period. They expressed support for the successful shift towards performance-based budgeting in the Commission’s budget planning. They encourage the Committee to apply that method to its own budget-planning procedure.

In 2016, the Committee’s budget - purely administrative - amounted to EUR 130 586 475 (EUR 129 100 000 in 2015), with a utilisation rate of 97.55 %. An increase of the utilisation rate was noted in 2016 when compared to 2015.

EESC’s activities: Members made a series of recommendations to the EESC:

continue applying performance-based budget principles in its daily operations and keep Parliament informed of the update of the key activity performance indicators (KAPIs) in 2017; provide the discharge authority with clarifications of expenditure in connection with the modernisation of the Committee, in order to boost transparency and accountability, and to publish the cost-benefit assessment; provide the discharge authority with a cost-benefit assessment of the missions for the Union and visited countries, and the list of the visited countries in 2016; further strengthen the contacts between the Committee and the chairs and the rapporteurs of Parliament’s committees in order to ensure better follow-up of the Committee’s contribution to the Union legislative process; put in place measures for improving staff well-being at work and for a closer monitoring of absences; urge the President, the Vice-Presidents and the Secretariat of the Committee to publish their declarations of interest on its website by the end of June 2018; put forward a unique and complete form of declaration of conflicts of interest to replace the declaration of absence of conflicts of interest; encourage the adoption of appropriate measures in order to make savings and reduce environmental pollution ; assess the potential of other instruments which may contribute to economic savings, inter alia on travel expenses; establish an independent body with sufficient budgetary resources to support whistleblowers wishing to disclose information on possible irregularities negatively impacting on the Union’s financial interests, while ensuring their confidentiality is protected; improve policy in order to further prevent any form of psychological and sexual harassment .

Parliament welcomed the administrative cooperation agreement between the Committee and the Committee of the Regions, which entered into force in 2016 and provides for shared translation and logistics directorates. It also welcomed the Committee’s compliance with the targets set by the interinstitutional agreement to reduce staff by 5 % over the period of five years.

Lastly, Parliament regretted that, at this point, no predictions can be made about the financial, administrative, human and other consequences related to the decision of the United Kingdom to withdraw from the Union. It called on the Committee and the Court to perform impact assessments and inform Parliament of the results by the end of 2018.

The Committee on Budgetary Control adopted the report by Ingeborg GRÄSSLE (EPP, DE) calling on the European Parliament to grant discharge to the Secretary-General of the European Economic and Social Committee discharge in respect of the implementation of the budget of the European Economic and Social Committee for the financial year 2016.

Members welcomed the conclusion of the Court of Auditors, according to which the payments as a whole for the year ended on 31 December 2016 for administrative and other expenditure of the European Economic and Social Committee were free from material error . No significant weaknesses were identified in respect of the audited topics relating to human resources and procurement.

Financial and budgetary management : Members welcomed the overall prudent and sound financial management of the Committee in the 2016 budget period. They expressed support for the successful paradigm shift towards performance-based budgeting in the Commission’s budget planning. They encourage the Committee to apply that method to its own budget-planning procedure.

In 2016, the Committee’s budget - purely administrative - amounted to EUR 130 586 475 (EUR 129 100 000 in 2015), with a utilisation rate of 97.55 %. An increase of the utilisation rate was noted in 2016 when compared to 2015.

EESC’s actions : Members made a series of recommendations to the EESC:

continue applying performance-based budget principles in its daily operations and keep Parliament informed of the update of the key activity performance indicators (KAPIs) in 2017; provide the discharge authority with clarifications of expenditure in connection with the modernisation of the Committee, in order to boost transparency and accountability, and to publish the cost-benefit assessment; provide the discharge authority with a cost-benefit assessment of the missions for the Union and visited countries, and the list of the visited countries in 2016; further strengthen the contacts between the Committee and the chairs and the rapporteurs of Parliament’s committees in order to ensure better follow-up of the Committee’s contribution to the Union legislative process; put in place measures for improving staff well-being at work and for a closer monitoring of absences; urge the President, the Vice-Presidents and the Secretariat of the Committee to publish their declarations of interest on its website by the end of June 2018; put forward a unique and complete form of declaration of conflicts of interest to replace the declaration of absence of conflicts of interest; encourage the adoption of appropriate measures in order to make savings and reduce environmental pollution; assess the potential of other instruments which may contribute to economic savings, inter alia on travel expenses; establish an independent disclosure, advice and referral body with sufficient budgetary resources, in order to help whistleblowers use the right channels to disclose their information on possible irregularities affecting the financial interests of the Union, while protecting their confidentiality and offering needed support and advice; improve policy in order to further prevent any form of psychological and sexual harassment.

Lastly, Members regretted the decision of the United Kingdom to withdraw from the European Union and that at this point no predictions can be made about the financial, administrative, human and other consequences related to the withdrawal. Members called on the Committee to perform impact assessments and inform Parliament of the results by the end of 2018.

Based on the observations contained in the report by the Court of Auditors, the Council called on the European Parliament to grant discharge to all of the EU institutions in respect of the implementation of their respective budgets for the financial year 2016.

The Council notes with satisfaction that the estimated level of error reported by the Court for payments in the "Administration" policy area further decreased by 0.6 percentage points to 0.2 % in 2016 , well below the materiality threshold of 2 %. It welcomes that no serious weaknesses were identified by the Court in the systems examined.

The Council underlines the need to respect the principles of annuality and of sound financial management and that the carry-over of appropriations should always be compliant with the rules of the Financial Regulation and be motivated with factual and genuine reasons.

The Council regrets that not all the EU institutions, bodies and agencies have achieved the 5 % reduction of posts in the establishment plan by the end of 2017 and urges these institutions, bodies and agencies to carry out the remaining reduction as soon as possible in order to achieve this target fully.

The Council also notes the Court's findings that the total number of staff posts in the establishment plans decreased by 1.1 % between 2012 and 2017, the number of posts actually occupied by staff increased by 0.4 % over the period from 1 January 2013 to 1 January 2017, and the actual payments for salaries for permanent officials and temporary agents increased by 9.2 % between 2012 and 2016.

While recognising that during the period 2013-2017 some EU institutions, bodies and agencies were tasked with new responsibilities and equipped with new resources, the Council considers that the gap between the expectations and the outcome is significant.

In this context, the Council acknowledges that by focusing solely on the headcount based on establishment plan posts, the methodology chosen was not suited to achieve the goal of reducing administrative expenditure.

The Court did not detect any specific problem concerning the European Economic and Social Committee .

PURPOSE: presentation of the Annual report of the Court of Auditors on the implementation of the budget concerning the financial year 2016.

CONTENT: the Court of Auditors published its 40 th annual report on the implementation of the general budget of the Union for the year 2016. This report follows a five-part structure:

the statement of assurance (DAS) and a summary of the results of our audit on the reliability of accounts and the regularity of transactions; the analysis of budgetary and financial management; the Commission’s performance reporting framework; the findings on EU revenue; the presentation of the main headings of the current multiannual financial framework (MFF), the results of the testing of the regularity of transactions.

The Court concludes that payments for 2016 are legal and regular, with the exception of those based on the cost reimbursement payments . It believes that the EU accounts present a true and fair view of the EU’s financial position.

The audit also focuses on the budget implementation of the Economic and Social Committee .

Overall, audit evidence indicates that spending on ‘Administration’ is not affected by a material level of error . For this MFF heading area, testing of transactions indicates that the estimated level of error present in the population is 0.2 %.

The Court noted that the institutions had collectively cut the number of posts in the establishment plan by 4% over the period from 2013 to 2017. The institutions had reduced the number of staff (posts actually occupied by a staff member) by 1.4 % between 2013 and 2017.

The Court also examined how the budgeted number of contract staff had changed. This number rose from 4 517 to 5 417 between 2013 and 2017 - an increase of 19.9 %. Contract staff made up 11.4 % of the number of staff in the establishment plan in 2013, and 14.2 % in 2017.

The institutions are achieving the 5 % reduction target by eliminating vacant posts in the establishment plan and by not replacing staff members leaving upon retirement, illness or at the end of temporary contracts.

The Court did not detect any specific problem regarding the Economic and Social Committee .

PURPOSE: presentation by the Commission of the consolidated annual accounts of the European Union for the financial year 2016, as part of the 2016 discharge procedure.

Analysis of the accounts of the EU Institutions: European Economic and Social Committee.

Consolidated annual accounts of the EU : this Commission document concerns the EU’s consolidated annual accounts for the year 2016, prepared on the basis of the information presented by the institutions and bodies under Article 148(2) of the Financial Regulation applicable to the general budget of the European Union. It details how spending by the EU institutions and bodies was carried out.

T he consolidated annual accounts of the EU provide financial information on the activities of the institutions, agencies and other bodies of the EU from an accrual accounting and budgetary perspective. It also presents the accounting principles applicable to the European budget (in particular, consolidation).

The document also presents the different financial actors involved in the budget process (accounting officers, internal officers and authorising officers) and recalls their respective roles in the context of the tasks of sound financial management.

Audit and discharge : the EU’s annual accounts and resource management are audited by the European Court of Auditors, its external auditor, which as part of its activities draws up for the European Parliament and the Council:

an annual report on the activities financed from the general budget, detailing its observations on the annual accounts and underlying transactions; an opinion, based on its audits and given in the annual report in the form of a statement of assurance, on (i) the reliability of the accounts and (ii) the legality and regularity of the underlying transactions involving both revenue collected from taxable persons and payments to final beneficiaries.

The European Parliament is the discharge authority within the EU. The discharge represents the final step of a budget lifecycle. It is the political aspect of the external control of budget implementation and is the decision by which the European Parliament, acting on a Council recommendation, "releases" the Commission (and other EU bodies) from its responsibility for management of a given budget by marking the end of that budget's existence.

This discharge procedure may produce three outcomes: (i) the granting; (ii) postponement; (iii) or the refusal of the discharge.

(2) Implementation of the Economic and Social Committee’s appropriations for the financial year 2016 : the total 2016 budget was EUR 130.6 million, of which EUR 127.0 million were spent or carried forward to 2017 as commitments. This equals a take-up rate of 97.2%, compared to 95.9% in 2015.

As regards the budget implementation of the EESC, the Annual Activity Report 2016 stated that the Committee focused on the following activities:

the EESC adopted a total of 151 opinions and reports, including 13 exploratory opinions on referral from the EU presidencies and 3 at the request of the European Commission, 58 opinions on referral from the European Parliament and Council and 42 on referral from the European Commission; 616 emails with citizens' questions were received in the general EESC mailbox and replied to in 2016, which corresponds to an increase of roughly 8% as compared to the previous year; four opinions about the circular economy, the functional economy, the collaborative economy and the sharing economy and self-regulation were published; enhanced dialogue with the civil society as well as civil society organisations in third countries with a view to monitoring the different strands of the EU’s external policies. New platforms were put in place for structured dialogue with Ukrainian civil society, as well as with Georgia and Chile; closer interinstitutional cooperation between the European Committee of the Regions and the EESC; the signature of the administrative arrangements between the EESC and the European Anti-Fraud Office (OLAF) which seek to facilitate the swift exchange of information; the process of revision of the EESC’s internal financial rules started in 2016, with the revised rules expected to come into force by the end of 2017.

PURPOSE: presentation by the Commission of the consolidated annual accounts of the European Union for the financial year 2016, as part of the 2016 discharge procedure.

Analysis of the accounts of the EU Institutions: European Economic and Social Committee.

Consolidated annual accounts of the EU : this Commission document concerns the EU’s consolidated annual accounts for the year 2016, prepared on the basis of the information presented by the institutions and bodies under Article 148(2) of the Financial Regulation applicable to the general budget of the European Union. It details how spending by the EU institutions and bodies was carried out.

T he consolidated annual accounts of the EU provide financial information on the activities of the institutions, agencies and other bodies of the EU from an accrual accounting and budgetary perspective. It also presents the accounting principles applicable to the European budget (in particular, consolidation).

The document also presents the different financial actors involved in the budget process (accounting officers, internal officers and authorising officers) and recalls their respective roles in the context of the tasks of sound financial management.

Audit and discharge : the EU’s annual accounts and resource management are audited by the European Court of Auditors, its external auditor, which as part of its activities draws up for the European Parliament and the Council:

an annual report on the activities financed from the general budget, detailing its observations on the annual accounts and underlying transactions; an opinion, based on its audits and given in the annual report in the form of a statement of assurance, on (i) the reliability of the accounts and (ii) the legality and regularity of the underlying transactions involving both revenue collected from taxable persons and payments to final beneficiaries.

The European Parliament is the discharge authority within the EU. The discharge represents the final step of a budget lifecycle. It is the political aspect of the external control of budget implementation and is the decision by which the European Parliament, acting on a Council recommendation, "releases" the Commission (and other EU bodies) from its responsibility for management of a given budget by marking the end of that budget's existence.

This discharge procedure may produce three outcomes: (i) the granting; (ii) postponement; (iii) or the refusal of the discharge.

(2) Implementation of the Economic and Social Committee’s appropriations for the financial year 2016 : the total 2016 budget was EUR 130.6 million, of which EUR 127.0 million were spent or carried forward to 2017 as commitments. This equals a take-up rate of 97.2%, compared to 95.9% in 2015.

As regards the budget implementation of the EESC, the Annual Activity Report 2016 stated that the Committee focused on the following activities:

the EESC adopted a total of 151 opinions and reports, including 13 exploratory opinions on referral from the EU presidencies and 3 at the request of the European Commission, 58 opinions on referral from the European Parliament and Council and 42 on referral from the European Commission; 616 emails with citizens' questions were received in the general EESC mailbox and replied to in 2016, which corresponds to an increase of roughly 8% as compared to the previous year; four opinions about the circular economy, the functional economy, the collaborative economy and the sharing economy and self-regulation were published; enhanced dialogue with the civil society as well as civil society organisations in third countries with a view to monitoring the different strands of the EU’s external policies. New platforms were put in place for structured dialogue with Ukrainian civil society, as well as with Georgia and Chile; closer interinstitutional cooperation between the European Committee of the Regions and the EESC; the signature of the administrative arrangements between the EESC and the European Anti-Fraud Office (OLAF) which seek to facilitate the swift exchange of information; the process of revision of the EESC’s internal financial rules started in 2016, with the revised rules expected to come into force by the end of 2017.