2022/2020(INI) Possibilities to increase the reliability of audits and controls by national authorities in shared management
Lead committee dossier:
Progress: Awaiting committee decision
Role | Committee | Rapporteur | Shadows |
---|---|---|---|
Lead | CONT | HOHLMEIER Monika ( EPP) | MANDA Claudiu ( S&D), WIEZIK Michal ( Renew), KUHS Joachim ( ID), FLANAGAN Luke Ming ( GUE/NGL) |
Committee Opinion | AGRI | FLANAGAN Luke Ming ( GUE/NGL) | Martin HÄUSLING ( Verts/ALE), Peter JAHR ( PPE), Atidzhe ALIEVA-VELI ( RE), Bert-Jan RUISSEN ( ECR), Camilla LAURETI ( S&D) |
Lead committee dossier:
Legal Basis:
RoP 54
Legal Basis:
RoP 54Events
2023/06/26
EP - Committee draft report
Documents
2022/10/26
EP - Committee opinion
Documents
2022/04/07
EP - HOHLMEIER Monika (EPP) appointed as rapporteur in CONT
2022/03/28
EP - FLANAGAN Luke Ming (GUE/NGL) appointed as rapporteur in AGRI
2022/03/10
EP - Committee referral announced in Parliament
Documents
Amendments | Dossier |
66 |
2022/2020(INI)
2022/06/16
AGRI
66 amendments...
Amendment 1 #
Draft opinion Recital A a (new) Aa. having regard to the Financial Regulation applicable to the general budget of the Union of 18 July 20181a, and to the proposal for its revision1b; __________________ 1a OJ-L 193/30.07.2018, p. 1 1b COM(2022) 223 final - Proposal for Regulation of the European Parliament and of the Council on the financial rules applicable to the general budget of the Union (recast)
Amendment 10 #
Draft opinion Paragraph 2 2. Recalls that under shared management, Member States are responsible for setting up a management and control system for payments and must ensure that it is capable of detecting and correcting irregularities; stresses that a distinction must be made between deliberate fraud and unintentional error; stresses the importance of continuing legal certainty regarding payments to beneficiaries who have acted in good faith;
Amendment 11 #
Draft opinion Paragraph 2 2. Recalls that under shared management, Member States are responsible for setting up a management and control system for payments and must ensure that it is capable of detecting and correcting irregularities; stresses that a distinction
Amendment 12 #
Draft opinion Paragraph 2 a (new) 2a. Insists that, for the reputation of the CAP, the standard of control systems must be robust and fully compliant with its new Common Agricultural Policy regulations in order to secure the proper implementation, in particular, of the new delivery model from 1 January 2023, and encourages the exchange of best practices to ensure this across all Member States;
Amendment 13 #
Draft opinion Paragraph 2 a (new) 2a. Stresses that the new Common Agricultural Policy should simplify matters for farmers; points out that, in view of concerns caused by administrative burdens under joint management, the CAP Strategic Plans should specifically seek to simplify matters for the final beneficiaries;
Amendment 14 #
Draft opinion Paragraph 2 a (new) Amendment 15 #
Draft opinion Paragraph 2 a (new) 2a. Points out the importance of information and awareness campaigns for the reduction of unintentional errors; calls on the Member States to organise such campaigns timely and involve all relevant stakeholders.
Amendment 16 #
Draft opinion Paragraph 2 b (new) 2b. Welcomes in this regard the provision established in the Regulation (EU) No 2021/2116 that give the CAP beneficiaries possibility to retroactively correct errors in their aid application that were done in good faith and similarly welcomes the early awareness mechanism that points out to CAP beneficiaries minor non-compliance without deducting any payments at first.
Amendment 17 #
Draft opinion Paragraph 2 b (new) 2b. Calls on the Commission, when assessing the CAP Strategic Plans, to focus in particular on the extent to which they simplify matters and reduce administrative burdens for the final beneficiaries;
Amendment 18 #
Draft opinion Paragraph 2 c (new) 2c. Stresses the simplifications and streamlining on the penalties for non- compliance that make a clear distinction between cases of intentional and non- intentional non-compliance and sets the penalties at lower level for the latter.
Amendment 19 #
Draft opinion Paragraph 3 3. Notes that Member States execute payments to CAP beneficiaries through accredited paying agencies (PAs), which perform on-the-spot checks to ensure the eligibility of applications and the correct execution of payments
Amendment 2 #
Draft opinion Recital B a (new) Ba. having regard to Regulation (EU) No 2021/2116 on the financing, management and monitoring (FMM) of the common agricultural policy (CAP);
Amendment 20 #
Draft opinion Paragraph 3 3. Notes that Member States execute payments of Union’s funds, co-financed with national funds in the case of second pillar rural development payments, to CAP beneficiaries through accredited paying agencies (PAs), which perform on- the-spot checks to ensure the eligibility of applications and the correct execution of payments;
Amendment 21 #
Draft opinion Paragraph 3 a (new) Amendment 22 #
Draft opinion Paragraph 3 b (new) 3b. Welcomes the Commission’s proposals on IT use in the proposal for revision of the Financial Regulation3a particularly to include use of electronic systems and digital controls to ensure adequate audit trails; __________________ 3a COM(2022) 223 final, point (d) of Articles 36(2) and point (a) of Article 63 (4)
Amendment 23 #
Draft opinion Paragraph 4 4. Notes the role of certification bodies (CBs) appointed as independent audit bodies by Member States; observes that CBs provide an opinion on the proper functioning of PAs’ management and control systems, and since 2015; notes the relative dominance of the same few large international corporate audit companies in fulfilling this role for different Member States.
Amendment 24 #
Draft opinion Paragraph 4 4. Notes the major role of certification bodies (CBs) appointed as independent audit bodies by Member States with an essentially risk-based approach; observes that CBs provide an opinion on the proper functioning of PAs’ management and control systems, and since 2015;
Amendment 25 #
Draft opinion Paragraph 4 4. Notes the role of certification bodies (CBs) appointed as independent audit bodies by Member States; observes that
Amendment 26 #
Draft opinion Paragraph 4 a (new) 4a. Recalls that the Commission plays a supervisory role, ensuring that the arrangements governing the management and control system are compliant by, among others, verifying the effective functioning of this system and making financial corrections, where necessary.
Amendment 27 #
Draft opinion Paragraph 4 a (new) 4a. Recalls that, from 1 January 2023, certification bodies must establish if Member States governance systems function properly, and whether expenditure is eligible according to the Financial Regulation4a; __________________ 4a Regulation (EU, Euratom) No 2021/2116 and in particular its Article 37
Amendment 28 #
Draft opinion Paragraph 4 a (new) 4a. Notes also the role the Commission external audit services in DG AGRI and the European Court of Auditors, carrying out control functions in the interest of the Union, evaluating risk to the CAP funds EAGF and EAFRD.
Amendment 29 #
Draft opinion Paragraph 5 5. Recalls that the main objective of th
Amendment 3 #
Draft opinion Recital C a (new) Ca. having regard to the Annual Activity Report 2021 by the Directorate General for Agriculture and Rural Development of the European Commission;
Amendment 30 #
Draft opinion Paragraph 5 5. Recalls that the main objective of this assurance model is to ensure that the remaining level of risk to the budget is below the materiality threshold of 2%;
Amendment 31 #
Draft opinion Paragraph 5 5. Recalls that the main objective of this assurance model is to ensure that the remaining risk to the budget is below the materiality threshold of 2
Amendment 32 #
Draft opinion Paragraph 5 5. Recalls that the main objective of this assurance model is to ensure that the remaining level of risk to the budget is below the materiality threshold of 2%; recognises and highlights the low error rates for the European Agricultural Guarantee Fund and the continuous decrease in error rates for the European Agricultural Fund for Rural Development over the past financial years;
Amendment 33 #
Draft opinion Paragraph 5 a (new) 5a. Understands the lower error rates for simpler payment schemes with relatively fewer deliverables, conditionalities or inherent complexity; notes that providing certain public goods such as CLLD (community-led local development), agri-environmental protection and building biodiversity are by their very nature more complex, so that their control is also more complex, with more errors possible; recalls that despite this, decades of Eurobarometer results in favour of climate, environment- and nature-friendly farming and bottom-up approaches show a consistently overwhelming public support from citizens for such schemes and their final deliverables in terms of public goods; insists that their marginally higher error rate should not discourage Member States from making them available to farmers and rural communities.
Amendment 34 #
Draft opinion Paragraph 5 a (new) 5a. Stresses that the rate of error can also be an indicator of the complexity of policies, identifying those areas in which further simplification is most needed; recommends, therefore, that the audit reports continue to give a clear breakdown of error rates for each pillar and, where appropriate, for each initiative, such as the eco-schemes, so as to ensure ongoing clarity about where further simplification is needed;
Amendment 35 #
Draft opinion Paragraph 6 6. Approves of most of the simplifications introduced in the CAP for 2023-27, facilitating management by national authorities alongside their responsibilities for audit and control; notes the simplification coming with the New Delivery Model that has deleted the control rate for eligibility of CAP basic payments (formerly 5% of beneficiaries) to rates determined by the Member States based on error and risk; 6a. Notes in this regard the role of the new Area Monitoring System outlined in the FMM CAP regulation, using Copernicus satellite cluster data and monitoring, to supplement the existing area-based controls by physical on-the- spot inspections and remote sensing used up until now; 6b. Understands that this extension of coverage of farmed land, particularly useful to monitor active farming, justifies the reduction in the basic control rate. Sees the special usefulness in using Copernicus data as new techniques in controlling conditionality and land use relevant for Eco-schemes and AECMs, as well as gathering and correcting for data used for the indicators of the performance of the new CAP (annex I SPR); e.g. crop rotation, EFA, not ploughing Natura2000 sites, protecting high-carbon soils, wetlands and peatlands, etc.;
Amendment 36 #
Draft opinion Paragraph 6 6. Approves of the simplifications introduced in the CAP for 2023-27, facilitating management by national authorities alongside their responsibilities for audit and control; recalls the addition of the ‘right to error’ for farmers and urges the Member States to implement this provision under the new national strategic plans;
Amendment 37 #
Draft opinion Paragraph 6 6.
Amendment 38 #
Draft opinion Paragraph 6 6. Approves of the simplifications introduced in the CAP for 2023-27, facilitating management by national authorities alongside their responsibilities for audit and control which must be carried out effectively to ensure errors and irregularities do not increase under this simplification;
Amendment 39 #
Draft opinion Paragraph 6 6.
Amendment 4 #
Draft opinion Paragraph 1 a (new) 1a. Calls on the Commission to place greater emphasis on administrative and technical assistance in the direct management of around 0.8% of the CAP budget;
Amendment 40 #
Draft opinion Paragraph 6 a (new) Amendment 41 #
Draft opinion Paragraph 6 a (new) 6a. Calls on the Member States to do their utmost to guarantee sound financial management, further reduction of errors and to avoid any delays in the implementation of CAP;
Amendment 42 #
Draft opinion Paragraph 6 b (new) Amendment 43 #
Draft opinion Paragraph 6 c (new) 6c. Notes the continued responsibility of the Commission to intervene if serious deficiencies are found in a member state control system, as outlined in the new FMM regulation;
Amendment 44 #
Draft opinion Paragraph 7 7. Supports the use of simplified cost options to allow authorities to calculate eligible expenditures of grants on the basis of flat rate financing to reduce complexity, ensuring that farmers are not out of pocket for payments compensating “costs incurred and income forgone”, e.g. Natura 2000, groundwater protection zones under the water framework directive, or other second pillar payments linked to statutory obligations; notes that ensuring high and at least remunerative payments for public goods provided by protection of such areas will, if applied correctly by the member states and the Commission, go far to diffuse tensions and resentment of some farmers against protection obligations;
Amendment 45 #
Draft opinion Paragraph 7 a (new) 7a. Reiterates the need to better balance the further simplification of rules and procedures with better controls over the most repeated areas of irregular spending, develop training sessions and practical information for applicants, in particular new applicants, and improve the assistance and guidelines for SMEs;
Amendment 46 #
Draft opinion Paragraph 7 a (new) 7a. Acknowledges that the strategies of fraudsters are constantly evolving to evade detection; underlines, therefore, the importance of regular analysis of the effectiveness of measures taken to combat fraud in order to ensure consistently high standards and effectiveness;
Amendment 47 #
Draft opinion Paragraph 7 b (new) 7b. Encourages Member States to evaluate regularly their audit practices and internal control systems for EU funds under shared management to ensure that they are reliable and function effectively in preventing, detecting and correcting irregularities, including new forms of irregular practises;
Amendment 48 #
Draft opinion Paragraph 8 8. Believes that digitalisation and the adoption of more sophisticated IT tools could improve the efficiency of the assurance process, as well as the use of the IACS to support the data monitoring needed to measure performance of the CAP via the indicators in annex I of the SPR; recalls that the performance approach was put forward in response to the clear and sustained wish of EU citizens to have a sustainable, fair and performing CAP; supports the extension of the use of the risk-scoring tool Arachne.
Amendment 49 #
Draft opinion Paragraph 8 8. Believes that digitalisation and the
Amendment 5 #
Draft opinion Paragraph 1 a (new) 1a. Recalls that, from 1st January 2023, the budget of the CAP implemented under shared management will be subject to the provisions of Regulation (EU) No 2021/2116 on the financing, management and monitoring (FMM) of the common agricultural policy;
Amendment 50 #
Draft opinion Paragraph 8 8. Believes that digitalisation and the adoption of more sophisticated IT tools c
Amendment 51 #
Draft opinion Paragraph 8 8. Believes that digitalisation and the adoption of more sophisticated and, at the same time, readily accessible IT tools could improve the efficiency of the assurance process; supports the extension of the use of the risk-scoring tool Arachne
Amendment 52 #
Draft opinion Paragraph 8 a (new) 8a. Supports the extension of the use of the data mining risk-scoring tools such as Arachne to help track beneficial owners, holding companies and oligarchs.
Amendment 53 #
Draft opinion Paragraph 8 a (new) Amendment 54 #
Draft opinion Paragraph 8 a (new) 8a. Underlines that the digitalization offers various opportunities when it comes to the management and control of Union’s policies and programmes and in particular in conducting audits; calls on the Member States, the Commission and all relevant authorities to take advantage of new IT tools and techniques to increase the reliability of audits and controls.
Amendment 55 #
Draft opinion Paragraph 8 a (new) 8a. Calls for increased action and sustained pressure on conflicts of interest and preventing the appropriation by oligarchs of public funds, in the interest of protecting EU taxpayers' money and to improve the reputation of the CAP, which may help it resist future demands for budget cuts.
Amendment 56 #
Draft opinion Paragraph 8 a (new) 8a. Acknowledges that the Commission proposed to make the use of a single data-mining and risk-scoring tool mandatory for funds under shared management and RRF; notes that this has not been retained in the adopted texts due to resistance in the Council.
Amendment 57 #
Draft opinion Paragraph 8 a (new) 8a. Stresses the importance of the correct implementation by the European Court of Auditors of the protection of the financial interest of the Union measures outlined in Regulation on control and penalties6a; __________________ 6a Title IV Chapter I
Amendment 58 #
Draft opinion Paragraph 8 b (new) 8b. Notes that conditionality is made up firstly of existing Union’s laws, applicable to all citizens, but filtered for relevance to on-farm operations and environmental, phyto-sanitary and animal welfare risk, and secondly of good farming practices; notes the continued control rate of only one out of each hundred beneficiaries for conditionality, and the minimal levels of sanctions, and the relatively low sanctioning rate; expresses surprise that the new delegated acts following the FMM regulation give more lenient sanctioning rates than was agreed by co-legislators in the long and painful CAP reform process, and further expresses concern that in an already very flexible system with early warning letters and zero percentage sanctions, the deterrent effect is being further eroded.
Amendment 59 #
Draft opinion Paragraph 8 b (new) 8b. Considers that the new delivery model under the FMM regulation must not hamper the European Court of Auditors in its task of assessing effectiveness, efficiency and economy of expenditure of EU funds under the new arrangements for the Common Agricultural Policy; seeks reassurance that the documentation required by point (c) of Article 9(3) of the same Regulation will be sufficient for the Court of Auditors to be able to verify cases of non- compliance with eligibility criteria for individual beneficiaries as per its Article 55;
Amendment 6 #
Draft opinion Paragraph 1 b (new) 1b. Recalls that the effectiveness and good reputation of the CAP depends on correct and efficient use of funds, for which audit and control are basic tools, and that the Commission’s audit role remains essential in assessing use of funds and contributing to the budget discharge process with the European Court of Auditors;
Amendment 60 #
Draft opinion Paragraph 8 b (new) 8b. Underlines strong and repeated requests to the Commission to ensure the protection of the Union budget by making global and systematic use of digital and automated systems for reporting, monitoring and audit; remarks that this should include the establishment of a mandatory digital interoperable database containing information on beneficiaries and their beneficial owners of funds from all Union programmes building on but not limited to existing tools, such as ARACHNE, EDES and national databases;
Amendment 61 #
Draft opinion Paragraph 8 b (new) 8b. Invites the EPPO, OLAF, the Commission, ECA and the Member States to strengthen their cooperation, including by, for example, creating more training programmes on the use of e-tools and audit practices, as well as on how to improve them.
Amendment 62 #
Draft opinion Paragraph 8 c (new) 8c. Welcomes the Commission’s explanations in its 2021 Annual Activity Report on action taken regarding conflicts of interest, particularly to ensure correct implementation in shared management by Member States authorities; welcomes likewise the adoption in 2021 and the dissemination of the Guidance on the avoidance and management of conflicts of interest under the Financial Regulation as a further measure for improvements in the way funds are administered and controlled;
Amendment 63 #
Draft opinion Paragraph 8 c (new) 8c. Encourages Member States, which have not joined the EPPO yet, to do so to ensure that more cases of fraud are investigated and prosecuted.
Amendment 64 #
Draft opinion Paragraph 8 d (new) 8d. Welcomes the Commission’s “EU Budget Focused on Results” strategy aimed at to improve efficiency of spending and achieve more with the available resources.
Amendment 65 #
Draft opinion Paragraph 8 e (new) 8e. Calls on the Commission to continue its efforts in the field of simplification of EU funding, especially with regard to reducing the burden of implementation and management of EU- funded projects;
Amendment 66 #
Draft opinion Paragraph 8 f (new) 8f. Reiterates that the creation of an integrated, interoperable and harmonised system to collect, monitor and analyse information about final beneficiaries in all Member States can help to further enhance the protection of Union finances and enable even closer scrutiny;
Amendment 7 #
Draft opinion Paragraph 2 2. Recalls that under shared management, Member States are responsible for setting up a management and control system for payments and must ensure that it is capable of detecting and correcting irregularities; stresses the need for the Member States to opt for preventive rather than punitive measures for the purposes of management and control, thereby helping to ensure that the system is administered as efficiently as possible for the benefit of recipients; stresses that a distinction must be made between deliberate fraud and unintentional error;
Amendment 8 #
Draft opinion Paragraph 2 2. Recalls that under shared management, Member States are responsible for setting up a management and control system for payments and must ensure that it is capable of detecting and correcting irregularities; stresses that a distinction must be made between deliberate fraud and unintentional error; maintains that it is necessary to reduce the administrative burden for farmers in order to ensure the more efficient deployment of CAP funds and measures to achieve its objectives;
Amendment 9 #
Draft opinion Paragraph 2 2. Recalls that under shared management, Member States are responsible for setting up a management and control system for payments and must ensure that it is capable of detecting and correcting irregularities; stresses that a distinction must be made between deliberate fraud and unintentional error, and suggests that Member States consider using an ad-hoc register where serious, intentional and repeated problems are identified;
source: 734.079
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History
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