The European Parliament decided to grant discharge to the Executive Director of the European Border and Coast Guard Agency in regard to the implementation of the agency’s budget for the 2016 financial year and to approve the closure of the accounts for the financial year in question.

Noting that the Court of Auditors has stated that it has obtained reasonable assurances that the agency’s annual accounts for the financial year 2016 are reliable and that the underlying transactions are legal and regular, Parliament adopted by 529 votes to 145 with 13 abstentions, a resolution containing a series of recommendations, which form an integral part of the decision on discharge and which add to the general recommendations set out in the resolution on performance, financial management and control of EU agencies:

• Agency’s financial statements: the final budget of the European Border and Coast Guard Agency for the financial year 2016 was EUR 232 757 000, representing an increase of 62.43 % compared to 2015. In response to the migration crisis faced by the Union, the mandate of the Agency was considerably extended in 2016.
• Budget and financial management: Members welcomed that the budget-monitoring efforts during the financial year 2016 resulted in a budget implementation rate of 97.90 %. They noted that under the Agency’s extended mandate, high importance is attached to return operations and EUR 63 million had been assigned to that in its 2016 budget. However, EUR 23 million was repaid to the Union budget since fewer return operations were carried out than envisaged.
• Parliament deplored the significant delay of the procurement procedure for a EUR 50 million framework contract to charter aircraft and related services for the Agency return operations had not been started by the year end while the launch of this procurement procedure was planned for March 2016. This delay continues to affect the number of return operations arranged by the Agency
• On 22 December 2015, the Commission and the Agency, as co-beneficiary and coordinator of three other co-beneficiaries - the European Asylum Support Office (EASO), the International Organisation for Migration (IOM) and the United Nations High Commissioner for Refugees (UNHCR) - signed a grant agreement amounting to EUR 5.5 million on regional support to protection-sensitive migration management in the Western Balkans and Turkey for a three year period starting on 1 January 2016. However, cooperation agreements with these three partners which amounted to EUR 3.4 million were only signed between August and November 2016. Members noted from the Agency’s reply that in order to document the fact that the legal commitment for all three project partners was made prior to the budgetary commitment, the Agency duly documented this as an exception.

The resolution indicated that, in 2017, the Agency is revising its entire financial scheme aiming at simplifications, switching from grants to service contracts and introducing flat rates. Parliament called on the Agency to report to the discharge authority on the implementation of the new scheme and the results achieved.

Members also made a series of observations regarding commitments and carry-overs, the prevention and management of conflicts of interests, internal audits and controls.

The Agency’s staff will more than double from 365 in 2016 to 1 000 in 2020 following the extension of its mandate.  However, the Agency traditionally experiences difficulties in finding staff with the required profile, partly because of the salary correction coefficient (66.7%).  Parliament called on the Agency to reflect on possible mitigating measures and that it reports on its reflections to the discharge authority. It also calls on the Agency to provide the discharge authority with an answer as to whether meetings with lobbyists had been registered and made public

Lastly, they noted that the Agency sees no financial risks influencing its operations caused by the Brexit.

The Committee on Budgetary Control adopted the report by Bart STAES (Greens/EFA, BE) on discharge in respect of the implementation of the budget of the European Border and Coast Guard Agency (Frontex) for the financial year 2016.

The committee called on the European Parliament to grant the Executive Director of the Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2016.

Noting that the Court of Auditors stated that it had obtained reasonable assurance that the annual accounts of the Agency for the financial year 2016 were reliable and that the underlying transactions were legal and regular, Members called on Parliament to approve 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:

• Agency’s financial statements: Members noted that the final budget of the European Border and Coast Guard Agency for the financial year 2016 was EUR 232 757 000, representing an increase of 62.43 % compared to 2015. In response to the migration crisis faced by the Union, the mandate of the Agency was considerably extended in 2016.
• Budget and financial management: Members welcomed that the budget-monitoring efforts during the financial year 2016 resulted in a budget implementation rate of 97.90 %. They noted that under the Agency’s extended mandate, high importance is attached to return operations and EUR 63 million had been assigned to that in its 2016 budget. However, EUR 23 million was repaid to the Union budget since fewer return operations were carried out than envisaged. On 22 December 2015, the Commission and the Agency signed a grant agreement amounting to EUR 5.5 million on regional support to protection-sensitive migration management in the Western Balkans and Turkey for a three year period starting on 1 January 2016. However, cooperation agreements with those three partners which amounted to EUR 3.4 million were only signed between August and November 2016. Members noted from the Agency’s reply that in order to document the fact that the legal commitment for all three project partners was made prior to the budgetary commitment, the Agency duly documented this as an exception.

Members also made a series of observations regarding commitments and carry-overs, the prevention and management of conflicts of interests, internal audits and controls.

Lastly, they noted that the Agency sees no financial risks influencing its operations caused by the Brexit.

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 European Agency for the Management of Operational Cooperation at the External Borders (Frontex).

CONTENT: the organisational governance of the EU consists of institutions, agencies and other EU bodies whose expenditure is included in the general budget of the Union.

This Commission document concerns the EU's consolidated accounts for the year 2016 and details how spending by the EU institutions and bodies was carried out. The 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 is the responsibility of the Commission's Accounting Officer to prepare the EU's consolidated annual accounts and ensure that they present fairly, in all material aspects, the financial position, the result of the operations and the cash flows of the EU institutions and bodies, including the European Agency for the Management of Operational Cooperation at the External Borders (Frontex), with a view to granting discharge.

Discharge procedure: the final step of a budget lifecycle is the discharge of the budget for a given financial year. It represents 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. The European Parliament is the discharge authority within the EU.

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

The final discharge report including specific recommendations to the Commission for action is adopted in plenary by the European Parliament and are subject to an annual follow up report in which the Commission outlines the concrete actions it has taken to implement the recommendations made.

Each agency is subject to its own discharge procedure, including Frontex.

FRONTEX: the Agency, which is located in Warsaw (PL), was established by Council Regulation (EC) No 2007/2004, amended by Regulation (EC) No 863/2007 of the European Parliament and of the Council. In 2016, Frontex’s mandate was boosted with the adoption of the European Border and Coast Guard Regulation (EU) 2016/1624. Under the new mandate, the role and activities were significantly expanded with its permanent staff being more than doubled. While the “European Border and Coast Guard Agency” replaces the “European Agency for the Management of Operational Cooperation at the External Borders of the Member States of the European Union”, it has the same legal personality and the same name: Frontex.

As regards Frontex’s accounts, these are presented in detail in the document on the consolidated annual accounts of the European Union for 2016:

Commitment appropriations:

• available: EUR 256 million;
• made: EUR 244 million.

Payment appropriations:

• available: EUR 300 million;
• made: EUR 199 million.

For further details on expenditure, please refer to final accounts of Frontex.