This Communication, entitled “A Budget for\nEurope 2020” contains the Commission’s proposals\nconcerning the Multiannual Financial Framework (MFF) for the\nperiod 2014-2020.
\nThe Commission's ambition for the next EU budget is to\nspend differently, with more emphasis on results and performance,\nconcentrating on delivering the Europe 2020 agenda through stronger\nconditionality in cohesion policy and greening of direct payments\nto farmers.
\nThe next budget should be modernised by reallocating\nresources to priority areas such as pan-European infrastructure,\nresearch and innovation, education and culture, securing the EU's\nexternal borders and external relations policy priorities such as\nthe EU's neighbourhood. It addresses cross-cutting policy\npriorities, such as environmental protection and the fight against\nclimate change, as an integral part of all the main instruments and\ninterventions.
\nThe overall amount proposed for the 2014-2020 period\nis EUR 1 025 000 million in commitment\nappropriations, broken down as\nfollows:
\nIn the design of the next MFF, the Commission has\nimplemented the principles it outlined in the 2010 budget\nreview:
\nThe programmes and instruments included in this MFF\nproposal have been redesigned to ensure that their outputs and\nimpacts push forward the key policy priorities of the EU. Major\nhallmarks of the next set of financial programmes and instruments\nwill be a focus on results, increased use of conditionality and the\nsimplification of delivery:
\n1) Results will be\nclearly related to the implementation of the Europe 2020\nstrategy and the achievement of its targets. This means\nconcentrating programmes on a limited number of high profile\npriorities and actions that achieve a critical mass. Fragmentation\nand uncoordinated interventions must be avoided. Where possible,\nexisting programmes will be merged (for example in areas such as\nhome affairs, education and culture) and/or redesigned (such as\nresearch and cohesion) to ensure integrated programming and a\nsingle set of implementation, reporting and control\nmechanisms.
\n2) Simplification: current funding rules have\nevolved not only in response to the need for accountability on how\npublic money is spent but also to take account of previous\nproblems. The result is a diversity and complexity that is\ndifficult to implement and control. This complexity imposes a heavy\nadministrative burden on beneficiaries as well as on the Commission\nand Member States, which can have the unintended effect of\ndiscouraging participation and delaying implementation. Work is\ncurrently under way to simplify both the general rules (Financial\nRegulation) and the sector specific rules.
\n3) Conditionality: in\norder to sharpen the focus on results rather than on inputs,\nconditionality will be introduced into programmes and instruments.\nThis is particularly relevant in the large spending blocs of\ncohesion policy and agriculture, where Member States and\nbeneficiaries will be required to demonstrate that the funding\nreceived is being used to further the achievement of EU policy\npriorities. More generally the Commission will ensure coherence\nbetween the overall economic policy of the EU and the EU budget, in\nparticular to avoid situations where the effectiveness of EU\nfunding is undermined by unsound macro-fiscal policies.
\n4) Leveraging investment: by working with the private sector on\ninnovative financial instruments it is possible to\nmagnify the impact of the EU budget, enabling a greater number of\nstrategic investments to be made, thus enhancing the EU's growth\npotential. Experience in working most notably with the European\nInvestment Bank (EIB) group, national and international public\nfinancial institutions has been positive and will be taken forward\nin the next MFF. Guarantees and risk sharing arrangements can allow\nthe financial sector to provide more equity and lend more money to\ninnovative companies, or to infrastructure projects. In this way,\nsuch financial instruments can also contribute to the overall\ndevelopment of post-crisis financial markets.
\nPURPOSE: to define a framework for the next generation\nof innovative financial instruments with a view to meeting\neffectively the objectives set by the Europe 2020\nstrategy.
\nBACKGROUND: the Commission and its financing partners\nhave undertaken considerable work on innovative financial\ninstruments since the launch of the Europe 2020 strategy and the\npreparation for the next multiannual financial framework (MFF), in\nparticular in the context of discussions on the future of specific\nfinancial instruments such as the Competitiveness and Innovation\nFramework Programme (CIP) or Risk Sharing Finance\nFacility (RSFF). Discussion has also begun with Council and\nParliament in the context of the revision of the Financial\nRegulation. Strong focus has been put on the importance and\nrelevance of financial instruments for the attainment of EU\npolicy objectives.
\nThe term “innovative financial\ninstrument” covers a broad range of cases where financial\nsupport from the budget is provided in other forms than pure\ngrants, including cases where EU grants are blended with loans\nfrom financial institutions. The intention behind an increased use\nof innovative financial instruments is however not to replace grant\nfunding with financial instruments, as grants will still be\nnecessary in a range of areas, but to complement the grant\nfunding by supporting projects pursuing EU policy objectives\nthrough other forms of intervention.
\nThe Europe 2020 Strategy envisages an increased\nmobilisation of innovative financial instruments as part of a\nconsistent funding strategy pulling together EU and national public\nand private funding. In its proposal for amendment of the Financial\nRegulation in the context of the triennial\nreview, the Commission included a new Title dedicated to the\nbudgetary management of financial instruments.
\nIn the Commission’s communication on the next MFF and the Budget Review, it\nis noted that innovative financial instruments could provide an\nimportant new financing stream for strategic investments,\nsupporting long-term, sustainable investment at a time of fiscal\nconstraint.
\nCONTENT: this Communication presents the Commission's\nview on the design and management of innovative financial\ninstruments which should play an increasingly more important\nrole in the EU budget spending of the 2014-2020 MFF. The\nCommunication takes stock of the analysis work on a new framework\nfor innovative financial instruments which has been carried out by\nthe Commission's throughout the phase of preparation of the next\nMFF. It looks at the design and management of innovative financial\ninstruments across policy sectors and sets out the next steps in\nachieving the Commission's ambition of a more streamlined,\ncomprehensive and highly efficient and effective toolbox of\ninnovative financial instruments to support the Europe 2020\nStrategy objectives.
\n1) Lessons learnt from experience acquired between\n2007 and 2013: for some of the\ncurrently existing innovative financial instruments (mainly those\nunder the CIP), assessments in the form of audits, interim and\nex post evaluations and studies have been carried out. A key\nconclusion at this juncture is that, due to the individual manner\nin which the existing innovative financial instruments have been\ndeveloped, some instruments overlap in terms of areas and\nbeneficiaries targeted and their design and management models vary,\nwhich could create confusion among stakeholders and\nbeneficiaries.
\nIn the design of the new generation of financial\ninstruments for the 2014-2020 MFF, if instruments are to be rolled\nout at larger scale, focus should be on exploiting the experience\nwith the existing financial instruments in order to establish\nappropriate rules, guidance and standardisation for the design and\nmanagement of innovative financial instruments in accordance with\nmarket requirements and best practices, to avoid overlaps and\nsimplify implementation modalities.
\nThis – together with an appropriate cross-policy\ngrouping of the innovative financial instruments proposed at EU\nlevel and enhanced consistency with such instruments implemented at\nnational, regional, transnational or cross border level under\nstructural funds programmes – will ensure an optimisation of\ntheir impact and EU value added in the next MFF.
\n2) Scope and sectors concerned: financial instruments are particularly suited to\naddressing sub-optimal investment situations in a broad range of\npolicy areas, e.g. for business activities or infrastructures that\nare capable of being financially viable (in terms, for example, of\nrevenue generating capacity), but do not (yet) attract sufficient\nfunding from market sources. They are in particular\nrelevant:
\n3) Innovative financial instruments for the 2014-2020\nMFF: the innovative financial\ninstruments dealt with in the Communication include instruments\nwhich provide equity/risk capital, or debt\ninstruments (such as loans or guarantees to intermediaries that\nprovide financing to a large number of final recipients who have\ndifficulties in accessing finance, or risk sharing with financial\ninstitutions in order to increase the volume of finance and hence\nthe impact resulting from the EU budget intervention).
\nThe communication on the MFF presents several of\nthe Commission’s sector-specific proposals for innovative\nfinancial instruments in the next MFF:
\n4) Common rules for streamlining and rationalising\ninstruments: the envisaged new\nframework for streamlining and rationalising the design and\nmanagement of the new generation of financial instruments is based\non what has been dubbed the EU equity and debt platforms.\nThe platforms are a set of common rules and guidance for\nequity and debt instruments (including guarantees and risk sharing)\nfor internal policies, ensuring a consistent approach to such\ninstruments where they are supported by the EU budget. The common\nrules and guidance also aim to streamline relations with financing\npartners, in particular the international financial institutions\nand provide transparency vis-à-vis the markets on how the EU\nintervenes by means of equity and debt instruments, ensuring\nhigher visibility of the EU's intervention. The EU equity\nand debt platforms would form part of a coherent body of\nhorizontally applicable principles, rules and guidance.
\nAs far as the Structural Funds are concerned,\nthe highest possible consistency should be achieved between the\ninstruments in shared and direct management and overlaps be\navoided, in order to prevent that several instruments target the\nsame beneficiary groups at EU and national/regional level while\noffering different terms. It should be made attractive to Member\nStates to contribute to EU level instruments with their structural\nfunds. A 3-options approach has been proposed within the\nframework of the Structural Funds Regulations:
\nMember States continue creating tailor-made\ninstruments under shared management principles, aligned with some\ncommon rules inspired by the EU equity and debt platforms under\ndevelopment for the EU instruments;
\ncreation of \"off-the-shelf instruments\" under shared\nmanagement principles which would facilitate the set-up of\ninstruments for Member States as well as ensure compatibility with\nthe EU-level instruments;
\nMember States would be encouraged to invest part of\ntheir structural funds in compartments of EU level instruments\n\"ring-fenced\" for investments in regions and policy areas covered\nby operational programmes from which structural funds resources are\ncontributed (“joint instruments”).
\nThe MFF Communication proposed further use of\ninnovative financing in all external policy instruments\n(where appropriate through regional investment facilities) so as to\nmobilise additional funding – including from the private\nsector – in support of EU priorities and cover the investment\nneeds of partner countries.
\nThe use of innovative financial instruments in\nexternal policies should be supported under the EU platform for\nexternal cooperation and development combining the respective\nstrengths of the Commission, Member States and European bilateral\nand multilateral financial institutions (notably the EIB) active in\nthe external development and cooperation field. The platform will\ncontribute to fostering EU coherence, effectiveness, efficiency and\nvisibility in external financing, while taking account of the\nspecificities of the EU's external partners.
\nThe Commission will continue its discussions with\nCouncil and Parliament in the coming months, both on the\ngeneral framework to be created by the Financial Regulation and the\nDelegated Act replacing its Implementing Rules, and on the specific\nlegislative proposals for the next MFF which will be successively\nadopted by the Commission in 4th Quarter 2011.
\nIn this communication, the Commission proposes a\nseries of measures in favour of integrated European infrastructures\nto stimulate growth.
\n1) Common challenges: in\nthe past decade, infrastructure spending in Europe has been, on\naverage, on a declining path. The economic and financial crisis\nhas, however, brought renewed interest in the need for\ninfrastructure investment. To be fully operational, the single\nmarket needs modern and high-performance infrastructure\ninterconnecting Europe, particularly in the areas of transport,\nenergy and telecommunications. Yet, while regulatory\nintegration advances within the EU and markets become more\nintegrated, physical, cross-border interconnection is\nlagging. Missing links exist, notably in the newer Member\nStates, creating dividing lines between the centre and peripheries\nof the European Union and hampering the further development of\nintra-community exchanges and growth.
\nOverall investment needs for networks of European\nimportance amount to about EUR 1 trillion for the period up to 2020\nin the three sectors mentioned above: about\nEUR 500 billion in transport, EUR 200 billion in energy and EUR 270\nbillion for fast broadband infrastructures.
\nIn the coming ten years, the EU must find a way to\nrise to this investment challenge. While the market, through\nappropriate investment and pricing mechanisms, is expected to play\na major role in delivering the required infrastructures, without\npublic intervention, some of the necessary investments would\nnot take place or will be delayed far beyond 2020.
\nThis is why the Commission is proposing the\nestablishment of an integrated multisectoral Connecting Europe Facility\n(CEF), complemented by specific guidelines for\nthe transport, energy and telecommunication sectors,\naims at setting up the right conditions to boost infrastructure\ndevelopment, leverage funding from private sources at a time in\nwhich public budgets are severely constrained, and help revitalise\nthe interest of long term specialised investors for investing in\nEurope, thus contributing to growth and job creation.
\n2) Connecting Europe Facility (CEF) – a common\ninfrastructure funding instrument:\nthe aim of the CEF is to streamline and facilitate EU support to\ninfrastructures by optimising the portfolio of instruments\navailable, standardising the operational rules for using them, and\ncapitalise on possible synergies across the three sectors. This\ncoordinated approach will not only ensure the largest possible\nEU added value, but will also simplify procedures and reduce\ncollective costs.
\nTo this end, the CEF proposal develops a common\nfinancing framework for all sectors, including co-ordinated\nannual work programmes, a common Committee, flexibility between\nsectoral budgets, increased performance indicators and\nconditionalities and the shared use of infrastructure specific\nfinancial instruments.
\nCEF funds will be centrally managed, either directly by Commission staff with the\nsupport, as needed, of an executive agency or through a partnership\nbetween the Commission and one or more financial institutions.\nSolutions for the operational management of the various instruments\nunder the CEF will be proposed within the appropriate legal\nframework, building on the experience gained with the TEN-T\nExecutive Agency and the existing cooperation with the European\nInvestment Bank.
\nThe Facility will be coordinated with the other\ninterventions coming from the EU budget such as ''Horizon\n2020'' and the Cohesion and Structural Funds.
\nThe Connecting Europe Facility will have a budget of\nEUR 50 billion for the period 2014-2020, allocated as\nfollows:
\n3) Financial instrument within the CEF: the toolbox of instruments should set the base for a\nlong-term stable investment framework and act as a catalyst with a\nview to attracting private capital. The Connecting Europe\nFacility seeks to fill this by two types of main\ninstruments:
\nThe long-term planning, construction and operational\ntime horizon of infrastructure projects also needs a long-term\npreparation to implement financial instruments. This is why,\nsimultaneously to the Connecting Europe Facility proposal, the\nCommission is proposing to launch a pilot phase of the Europe 2020 Project Bond\nInitiative already under the current financial\nframework.
\nThe Committee on Budgets adopted a report by Eider\nGARDIAZÁBAL RUBIAL (S&D, ES) on innovative financial\ninstruments in the context of the next Multiannual Financial\nFramework in response to the Commission’s communication\nentitled “A framework for the next generation of innovative\nfinancial instruments – the EU equity and debt platforms”.
\nThe committee responsible points out that the\ninnovative financial instruments (IFIs) developed thus far have\nbeen used to carry out an extremely wide variety of\ninterventions, ranging from the taking of stakes in\nequity/venture capital funds to the provision of\nguarantees/counter-guarantees to financial intermediaries (in\nparticular banks), via the creation jointly with financial\ninstitutions of risk-sharing instruments in order to stimulate\ninvestment, innovation and research.
\nThe report emphasises that the experience gained\nthus far with IFIs is satisfactory in overall terms, even if\ntheir multiplier effect varies substantially depending on the area\nof intervention. Members reiterate that the increased use of IFIs\nshould not turn into a strategy to reduce the size of the Union\nbudget but should serve to optimise its use and welcome the\nfact that the Commission acknowledges that the intention behind an\nincreased use of innovative financial instruments is not to replace\ngrant funding with financial instruments.
\nIt is estimated that approximately 1.3 % of the EU\nbudget is currently devoted to IFIs, the Union having created,\nwithin the 2007-2013 MFF, 14 such instruments in the field of\ninternal policies (EUR 3 billion, or 3.4 % of the available budget\nand approximately EUR 5.9 billion for regional and cohesion policy)\nas well as 11 in the field of external policies (EUR 1.2 billion,\nor 2.2 %, under budget heading 4, without taking into account those\nIFIs created in connection with the European Development\nFund).
\nIn a context where project promoters are facing a\ncredit squeeze and are finding it more difficult to borrow money on\nthe capital markets, Members are convinced that the continued\ndevelopment of IFIs at national and Union level could become a\ncontributing factor if the Union is to ensure a coordinated return\nto smart , sustainable and inclusive growth.
\nMembers formulate a series of recommendations in\nrespect of innovative financial instruments:
\nThe report requests as a matter of urgency that the project\nbonds initiative be implemented and that an accurate evaluation\nbe carried out of the appropriateness of a new, separate initiative\nfor the issuing of European bonds for infrastructure, with the\ndirect participation of EU capital in infrastructure projects in\nthe common interest, with strong European added value, through the\npublic issuing of project bonds on the part of the\nUnion.
\nMembers believe that the European Union would send a\npowerful signal to public and private investors, as well as to\nfinancial markets, by participating directly, alone or with\nMember States, in the capitalisation of infrastructure\nprojects (characterised by long-term return on investment).\nThis EU participation in an investment capacity should ensure\nconsistency with the Union’s\nlong-term policy objectives and would represent a guarantee of\nrealisation of the project, serving as a strong catalyst and an\nequally strong lever.
\nLastly, the Commission is called on to submit, as\nquickly as possible, proposals to facilitate the release of\nsavings, an underused resource at present, to support medium-\nand long-term projects which generate sustainable growth in the\nUnion.
\nIn this communication, the Commission proposes a\nseries of measures in favour of integrated European infrastructures\nto stimulate growth.
\n1) Common challenges: in\nthe past decade, infrastructure spending in Europe has been, on\naverage, on a declining path. The economic and financial crisis\nhas, however, brought renewed interest in the need for\ninfrastructure investment. To be fully operational, the single\nmarket needs modern and high-performance infrastructure\ninterconnecting Europe, particularly in the areas of transport,\nenergy and telecommunications. Yet, while regulatory\nintegration advances within the EU and markets become more\nintegrated, physical, cross-border interconnection is\nlagging. Missing links exist, notably in the newer Member\nStates, creating dividing lines between the centre and peripheries\nof the European Union and hampering the further development of\nintra-community exchanges and growth.
\nOverall investment needs for networks of European\nimportance amount to about EUR 1 trillion for the period up to 2020\nin the three sectors mentioned above: about\nEUR 500 billion in transport, EUR 200 billion in energy and EUR 270\nbillion for fast broadband infrastructures.
\nIn the coming ten years, the EU must find a way to\nrise to this investment challenge. While the market, through\nappropriate investment and pricing mechanisms, is expected to play\na major role in delivering the required infrastructures, without\npublic intervention, some of the necessary investments would\nnot take place or will be delayed far beyond 2020.
\nThis is why the Commission is proposing the\nestablishment of an integrated multisectoral Connecting Europe Facility\n(CEF), complemented by specific guidelines for\nthe transport, energy and telecommunication sectors,\naims at setting up the right conditions to boost infrastructure\ndevelopment, leverage funding from private sources at a time in\nwhich public budgets are severely constrained, and help revitalise\nthe interest of long term specialised investors for investing in\nEurope, thus contributing to growth and job creation.
\n2) Connecting Europe Facility (CEF) – a common\ninfrastructure funding instrument:\nthe aim of the CEF is to streamline and facilitate EU support to\ninfrastructures by optimising the portfolio of instruments\navailable, standardising the operational rules for using them, and\ncapitalise on possible synergies across the three sectors. This\ncoordinated approach will not only ensure the largest possible\nEU added value, but will also simplify procedures and reduce\ncollective costs.
\nTo this end, the CEF proposal develops a common\nfinancing framework for all sectors, including co-ordinated\nannual work programmes, a common Committee, flexibility between\nsectoral budgets, increased performance indicators and\nconditionalities and the shared use of infrastructure specific\nfinancial instruments.
\nCEF funds will be centrally managed, either directly by Commission staff with the\nsupport, as needed, of an executive agency or through a partnership\nbetween the Commission and one or more financial institutions.\nSolutions for the operational management of the various instruments\nunder the CEF will be proposed within the appropriate legal\nframework, building on the experience gained with the TEN-T\nExecutive Agency and the existing cooperation with the European\nInvestment Bank.
\nThe Facility will be coordinated with the other\ninterventions coming from the EU budget such as ''Horizon\n2020'' and the Cohesion and Structural Funds.
\nThe Connecting Europe Facility will have a budget of\nEUR 50 billion for the period 2014-2020, allocated as\nfollows:
\n3) Financial instrument within the CEF: the toolbox of instruments should set the base for a\nlong-term stable investment framework and act as a catalyst with a\nview to attracting private capital. The Connecting Europe\nFacility seeks to fill this by two types of main\ninstruments:
\nThe long-term planning, construction and operational\ntime horizon of infrastructure projects also needs a long-term\npreparation to implement financial instruments. This is why,\nsimultaneously to the Connecting Europe Facility proposal, the\nCommission is proposing to launch a pilot phase of the Europe 2020 Project Bond\nInitiative already under the current financial\nframework.
\nThe Committee on Budgets adopted a report by Eider\nGARDIAZÁBAL RUBIAL (S&D, ES) on innovative financial\ninstruments in the context of the next Multiannual Financial\nFramework in response to the Commission’s communication\nentitled “A framework for the next generation of innovative\nfinancial instruments – the EU equity and debt platforms”.
\nThe committee responsible points out that the\ninnovative financial instruments (IFIs) developed thus far have\nbeen used to carry out an extremely wide variety of\ninterventions, ranging from the taking of stakes in\nequity/venture capital funds to the provision of\nguarantees/counter-guarantees to financial intermediaries (in\nparticular banks), via the creation jointly with financial\ninstitutions of risk-sharing instruments in order to stimulate\ninvestment, innovation and research.
\nThe report emphasises that the experience gained\nthus far with IFIs is satisfactory in overall terms, even if\ntheir multiplier effect varies substantially depending on the area\nof intervention. Members reiterate that the increased use of IFIs\nshould not turn into a strategy to reduce the size of the Union\nbudget but should serve to optimise its use and welcome the\nfact that the Commission acknowledges that the intention behind an\nincreased use of innovative financial instruments is not to replace\ngrant funding with financial instruments.
\nIt is estimated that approximately 1.3 % of the EU\nbudget is currently devoted to IFIs, the Union having created,\nwithin the 2007-2013 MFF, 14 such instruments in the field of\ninternal policies (EUR 3 billion, or 3.4 % of the available budget\nand approximately EUR 5.9 billion for regional and cohesion policy)\nas well as 11 in the field of external policies (EUR 1.2 billion,\nor 2.2 %, under budget heading 4, without taking into account those\nIFIs created in connection with the European Development\nFund).
\nIn a context where project promoters are facing a\ncredit squeeze and are finding it more difficult to borrow money on\nthe capital markets, Members are convinced that the continued\ndevelopment of IFIs at national and Union level could become a\ncontributing factor if the Union is to ensure a coordinated return\nto smart , sustainable and inclusive growth.
\nMembers formulate a series of recommendations in\nrespect of innovative financial instruments:
\nThe report requests as a matter of urgency that the project\nbonds initiative be implemented and that an accurate evaluation\nbe carried out of the appropriateness of a new, separate initiative\nfor the issuing of European bonds for infrastructure, with the\ndirect participation of EU capital in infrastructure projects in\nthe common interest, with strong European added value, through the\npublic issuing of project bonds on the part of the\nUnion.
\nMembers believe that the European Union would send a\npowerful signal to public and private investors, as well as to\nfinancial markets, by participating directly, alone or with\nMember States, in the capitalisation of infrastructure\nprojects (characterised by long-term return on investment).\nThis EU participation in an investment capacity should ensure\nconsistency with the Union’s\nlong-term policy objectives and would represent a guarantee of\nrealisation of the project, serving as a strong catalyst and an\nequally strong lever.
\nLastly, the Commission is called on to submit, as\nquickly as possible, proposals to facilitate the release of\nsavings, an underused resource at present, to support medium-\nand long-term projects which generate sustainable growth in the\nUnion.
\nIn this communication, the Commission proposes a\nseries of measures in favour of integrated European infrastructures\nto stimulate growth.
\n1) Common challenges: in\nthe past decade, infrastructure spending in Europe has been, on\naverage, on a declining path. The economic and financial crisis\nhas, however, brought renewed interest in the need for\ninfrastructure investment. To be fully operational, the single\nmarket needs modern and high-performance infrastructure\ninterconnecting Europe, particularly in the areas of transport,\nenergy and telecommunications. Yet, while regulatory\nintegration advances within the EU and markets become more\nintegrated, physical, cross-border interconnection is\nlagging. Missing links exist, notably in the newer Member\nStates, creating dividing lines between the centre and peripheries\nof the European Union and hampering the further development of\nintra-community exchanges and growth.
\nOverall investment needs for networks of European\nimportance amount to about EUR 1 trillion for the period up to 2020\nin the three sectors mentioned above: about\nEUR 500 billion in transport, EUR 200 billion in energy and EUR 270\nbillion for fast broadband infrastructures.
\nIn the coming ten years, the EU must find a way to\nrise to this investment challenge. While the market, through\nappropriate investment and pricing mechanisms, is expected to play\na major role in delivering the required infrastructures, without\npublic intervention, some of the necessary investments would\nnot take place or will be delayed far beyond 2020.
\nThis is why the Commission is proposing the\nestablishment of an integrated multisectoral Connecting Europe Facility\n(CEF), complemented by specific guidelines for\nthe transport, energy and telecommunication sectors,\naims at setting up the right conditions to boost infrastructure\ndevelopment, leverage funding from private sources at a time in\nwhich public budgets are severely constrained, and help revitalise\nthe interest of long term specialised investors for investing in\nEurope, thus contributing to growth and job creation.
\n2) Connecting Europe Facility (CEF) – a common\ninfrastructure funding instrument:\nthe aim of the CEF is to streamline and facilitate EU support to\ninfrastructures by optimising the portfolio of instruments\navailable, standardising the operational rules for using them, and\ncapitalise on possible synergies across the three sectors. This\ncoordinated approach will not only ensure the largest possible\nEU added value, but will also simplify procedures and reduce\ncollective costs.
\nTo this end, the CEF proposal develops a common\nfinancing framework for all sectors, including co-ordinated\nannual work programmes, a common Committee, flexibility between\nsectoral budgets, increased performance indicators and\nconditionalities and the shared use of infrastructure specific\nfinancial instruments.
\nCEF funds will be centrally managed, either directly by Commission staff with the\nsupport, as needed, of an executive agency or through a partnership\nbetween the Commission and one or more financial institutions.\nSolutions for the operational management of the various instruments\nunder the CEF will be proposed within the appropriate legal\nframework, building on the experience gained with the TEN-T\nExecutive Agency and the existing cooperation with the European\nInvestment Bank.
\nThe Facility will be coordinated with the other\ninterventions coming from the EU budget such as ''Horizon\n2020'' and the Cohesion and Structural Funds.
\nThe Connecting Europe Facility will have a budget of\nEUR 50 billion for the period 2014-2020, allocated as\nfollows:
\n3) Financial instrument within the CEF: the toolbox of instruments should set the base for a\nlong-term stable investment framework and act as a catalyst with a\nview to attracting private capital. The Connecting Europe\nFacility seeks to fill this by two types of main\ninstruments:
\nThe long-term planning, construction and operational\ntime horizon of infrastructure projects also needs a long-term\npreparation to implement financial instruments. This is why,\nsimultaneously to the Connecting Europe Facility proposal, the\nCommission is proposing to launch a pilot phase of the Europe 2020 Project Bond\nInitiative already under the current financial\nframework.
\nThis Communication, entitled “A Budget for\nEurope 2020” contains the Commission’s proposals\nconcerning the Multiannual Financial Framework (MFF) for the\nperiod 2014-2020.
\nThe Commission's ambition for the next EU budget is to\nspend differently, with more emphasis on results and performance,\nconcentrating on delivering the Europe 2020 agenda through stronger\nconditionality in cohesion policy and greening of direct payments\nto farmers.
\nThe next budget should be modernised by reallocating\nresources to priority areas such as pan-European infrastructure,\nresearch and innovation, education and culture, securing the EU's\nexternal borders and external relations policy priorities such as\nthe EU's neighbourhood. It addresses cross-cutting policy\npriorities, such as environmental protection and the fight against\nclimate change, as an integral part of all the main instruments and\ninterventions.
\nThe overall amount proposed for the 2014-2020 period\nis EUR 1 025 000 million in commitment\nappropriations, broken down as\nfollows:
\nIn the design of the next MFF, the Commission has\nimplemented the principles it outlined in the 2010 budget\nreview:
\nThe programmes and instruments included in this MFF\nproposal have been redesigned to ensure that their outputs and\nimpacts push forward the key policy priorities of the EU. Major\nhallmarks of the next set of financial programmes and instruments\nwill be a focus on results, increased use of conditionality and the\nsimplification of delivery:
\n1) Results will be\nclearly related to the implementation of the Europe 2020\nstrategy and the achievement of its targets. This means\nconcentrating programmes on a limited number of high profile\npriorities and actions that achieve a critical mass. Fragmentation\nand uncoordinated interventions must be avoided. Where possible,\nexisting programmes will be merged (for example in areas such as\nhome affairs, education and culture) and/or redesigned (such as\nresearch and cohesion) to ensure integrated programming and a\nsingle set of implementation, reporting and control\nmechanisms.
\n2) Simplification: current funding rules have\nevolved not only in response to the need for accountability on how\npublic money is spent but also to take account of previous\nproblems. The result is a diversity and complexity that is\ndifficult to implement and control. This complexity imposes a heavy\nadministrative burden on beneficiaries as well as on the Commission\nand Member States, which can have the unintended effect of\ndiscouraging participation and delaying implementation. Work is\ncurrently under way to simplify both the general rules (Financial\nRegulation) and the sector specific rules.
\n3) Conditionality: in\norder to sharpen the focus on results rather than on inputs,\nconditionality will be introduced into programmes and instruments.\nThis is particularly relevant in the large spending blocs of\ncohesion policy and agriculture, where Member States and\nbeneficiaries will be required to demonstrate that the funding\nreceived is being used to further the achievement of EU policy\npriorities. More generally the Commission will ensure coherence\nbetween the overall economic policy of the EU and the EU budget, in\nparticular to avoid situations where the effectiveness of EU\nfunding is undermined by unsound macro-fiscal policies.
\n4) Leveraging investment: by working with the private sector on\ninnovative financial instruments it is possible to\nmagnify the impact of the EU budget, enabling a greater number of\nstrategic investments to be made, thus enhancing the EU's growth\npotential. Experience in working most notably with the European\nInvestment Bank (EIB) group, national and international public\nfinancial institutions has been positive and will be taken forward\nin the next MFF. Guarantees and risk sharing arrangements can allow\nthe financial sector to provide more equity and lend more money to\ninnovative companies, or to infrastructure projects. In this way,\nsuch financial instruments can also contribute to the overall\ndevelopment of post-crisis financial markets.
\nPURPOSE: to define a framework for the next generation\nof innovative financial instruments with a view to meeting\neffectively the objectives set by the Europe 2020\nstrategy.
\nBACKGROUND: the Commission and its financing partners\nhave undertaken considerable work on innovative financial\ninstruments since the launch of the Europe 2020 strategy and the\npreparation for the next multiannual financial framework (MFF), in\nparticular in the context of discussions on the future of specific\nfinancial instruments such as the Competitiveness and Innovation\nFramework Programme (CIP) or Risk Sharing Finance\nFacility (RSFF). Discussion has also begun with Council and\nParliament in the context of the revision of the Financial\nRegulation. Strong focus has been put on the importance and\nrelevance of financial instruments for the attainment of EU\npolicy objectives.
\nThe term “innovative financial\ninstrument” covers a broad range of cases where financial\nsupport from the budget is provided in other forms than pure\ngrants, including cases where EU grants are blended with loans\nfrom financial institutions. The intention behind an increased use\nof innovative financial instruments is however not to replace grant\nfunding with financial instruments, as grants will still be\nnecessary in a range of areas, but to complement the grant\nfunding by supporting projects pursuing EU policy objectives\nthrough other forms of intervention.
\nThe Europe 2020 Strategy envisages an increased\nmobilisation of innovative financial instruments as part of a\nconsistent funding strategy pulling together EU and national public\nand private funding. In its proposal for amendment of the Financial\nRegulation in the context of the triennial\nreview, the Commission included a new Title dedicated to the\nbudgetary management of financial instruments.
\nIn the Commission’s communication on the next MFF and the Budget Review, it\nis noted that innovative financial instruments could provide an\nimportant new financing stream for strategic investments,\nsupporting long-term, sustainable investment at a time of fiscal\nconstraint.
\nCONTENT: this Communication presents the Commission's\nview on the design and management of innovative financial\ninstruments which should play an increasingly more important\nrole in the EU budget spending of the 2014-2020 MFF. The\nCommunication takes stock of the analysis work on a new framework\nfor innovative financial instruments which has been carried out by\nthe Commission's throughout the phase of preparation of the next\nMFF. It looks at the design and management of innovative financial\ninstruments across policy sectors and sets out the next steps in\nachieving the Commission's ambition of a more streamlined,\ncomprehensive and highly efficient and effective toolbox of\ninnovative financial instruments to support the Europe 2020\nStrategy objectives.
\n1) Lessons learnt from experience acquired between\n2007 and 2013: for some of the\ncurrently existing innovative financial instruments (mainly those\nunder the CIP), assessments in the form of audits, interim and\nex post evaluations and studies have been carried out. A key\nconclusion at this juncture is that, due to the individual manner\nin which the existing innovative financial instruments have been\ndeveloped, some instruments overlap in terms of areas and\nbeneficiaries targeted and their design and management models vary,\nwhich could create confusion among stakeholders and\nbeneficiaries.
\nIn the design of the new generation of financial\ninstruments for the 2014-2020 MFF, if instruments are to be rolled\nout at larger scale, focus should be on exploiting the experience\nwith the existing financial instruments in order to establish\nappropriate rules, guidance and standardisation for the design and\nmanagement of innovative financial instruments in accordance with\nmarket requirements and best practices, to avoid overlaps and\nsimplify implementation modalities.
\nThis – together with an appropriate cross-policy\ngrouping of the innovative financial instruments proposed at EU\nlevel and enhanced consistency with such instruments implemented at\nnational, regional, transnational or cross border level under\nstructural funds programmes – will ensure an optimisation of\ntheir impact and EU value added in the next MFF.
\n2) Scope and sectors concerned: financial instruments are particularly suited to\naddressing sub-optimal investment situations in a broad range of\npolicy areas, e.g. for business activities or infrastructures that\nare capable of being financially viable (in terms, for example, of\nrevenue generating capacity), but do not (yet) attract sufficient\nfunding from market sources. They are in particular\nrelevant:
\n3) Innovative financial instruments for the 2014-2020\nMFF: the innovative financial\ninstruments dealt with in the Communication include instruments\nwhich provide equity/risk capital, or debt\ninstruments (such as loans or guarantees to intermediaries that\nprovide financing to a large number of final recipients who have\ndifficulties in accessing finance, or risk sharing with financial\ninstitutions in order to increase the volume of finance and hence\nthe impact resulting from the EU budget intervention).
\nThe communication on the MFF presents several of\nthe Commission’s sector-specific proposals for innovative\nfinancial instruments in the next MFF:
\n4) Common rules for streamlining and rationalising\ninstruments: the envisaged new\nframework for streamlining and rationalising the design and\nmanagement of the new generation of financial instruments is based\non what has been dubbed the EU equity and debt platforms.\nThe platforms are a set of common rules and guidance for\nequity and debt instruments (including guarantees and risk sharing)\nfor internal policies, ensuring a consistent approach to such\ninstruments where they are supported by the EU budget. The common\nrules and guidance also aim to streamline relations with financing\npartners, in particular the international financial institutions\nand provide transparency vis-à-vis the markets on how the EU\nintervenes by means of equity and debt instruments, ensuring\nhigher visibility of the EU's intervention. The EU equity\nand debt platforms would form part of a coherent body of\nhorizontally applicable principles, rules and guidance.
\nAs far as the Structural Funds are concerned,\nthe highest possible consistency should be achieved between the\ninstruments in shared and direct management and overlaps be\navoided, in order to prevent that several instruments target the\nsame beneficiary groups at EU and national/regional level while\noffering different terms. It should be made attractive to Member\nStates to contribute to EU level instruments with their structural\nfunds. A 3-options approach has been proposed within the\nframework of the Structural Funds Regulations:
\nMember States continue creating tailor-made\ninstruments under shared management principles, aligned with some\ncommon rules inspired by the EU equity and debt platforms under\ndevelopment for the EU instruments;
\ncreation of \"off-the-shelf instruments\" under shared\nmanagement principles which would facilitate the set-up of\ninstruments for Member States as well as ensure compatibility with\nthe EU-level instruments;
\nMember States would be encouraged to invest part of\ntheir structural funds in compartments of EU level instruments\n\"ring-fenced\" for investments in regions and policy areas covered\nby operational programmes from which structural funds resources are\ncontributed (“joint instruments”).
\nThe MFF Communication proposed further use of\ninnovative financing in all external policy instruments\n(where appropriate through regional investment facilities) so as to\nmobilise additional funding – including from the private\nsector – in support of EU priorities and cover the investment\nneeds of partner countries.
\nThe use of innovative financial instruments in\nexternal policies should be supported under the EU platform for\nexternal cooperation and development combining the respective\nstrengths of the Commission, Member States and European bilateral\nand multilateral financial institutions (notably the EIB) active in\nthe external development and cooperation field. The platform will\ncontribute to fostering EU coherence, effectiveness, efficiency and\nvisibility in external financing, while taking account of the\nspecificities of the EU's external partners.
\nThe Commission will continue its discussions with\nCouncil and Parliament in the coming months, both on the\ngeneral framework to be created by the Financial Regulation and the\nDelegated Act replacing its Implementing Rules, and on the specific\nlegislative proposals for the next MFF which will be successively\nadopted by the Commission in 4th Quarter 2011.
\nIn this communication, the Commission proposes a\nseries of measures in favour of integrated European infrastructures\nto stimulate growth.
\n1) Common challenges: in\nthe past decade, infrastructure spending in Europe has been, on\naverage, on a declining path. The economic and financial crisis\nhas, however, brought renewed interest in the need for\ninfrastructure investment. To be fully operational, the single\nmarket needs modern and high-performance infrastructure\ninterconnecting Europe, particularly in the areas of transport,\nenergy and telecommunications. Yet, while regulatory\nintegration advances within the EU and markets become more\nintegrated, physical, cross-border interconnection is\nlagging. Missing links exist, notably in the newer Member\nStates, creating dividing lines between the centre and peripheries\nof the European Union and hampering the further development of\nintra-community exchanges and growth.
\nOverall investment needs for networks of European\nimportance amount to about EUR 1 trillion for the period up to 2020\nin the three sectors mentioned above: about\nEUR 500 billion in transport, EUR 200 billion in energy and EUR 270\nbillion for fast broadband infrastructures.
\nIn the coming ten years, the EU must find a way to\nrise to this investment challenge. While the market, through\nappropriate investment and pricing mechanisms, is expected to play\na major role in delivering the required infrastructures, without\npublic intervention, some of the necessary investments would\nnot take place or will be delayed far beyond 2020.
\nThis is why the Commission is proposing the\nestablishment of an integrated multisectoral Connecting Europe Facility\n(CEF), complemented by specific guidelines for\nthe transport, energy and telecommunication sectors,\naims at setting up the right conditions to boost infrastructure\ndevelopment, leverage funding from private sources at a time in\nwhich public budgets are severely constrained, and help revitalise\nthe interest of long term specialised investors for investing in\nEurope, thus contributing to growth and job creation.
\n2) Connecting Europe Facility (CEF) – a common\ninfrastructure funding instrument:\nthe aim of the CEF is to streamline and facilitate EU support to\ninfrastructures by optimising the portfolio of instruments\navailable, standardising the operational rules for using them, and\ncapitalise on possible synergies across the three sectors. This\ncoordinated approach will not only ensure the largest possible\nEU added value, but will also simplify procedures and reduce\ncollective costs.
\nTo this end, the CEF proposal develops a common\nfinancing framework for all sectors, including co-ordinated\nannual work programmes, a common Committee, flexibility between\nsectoral budgets, increased performance indicators and\nconditionalities and the shared use of infrastructure specific\nfinancial instruments.
\nCEF funds will be centrally managed, either directly by Commission staff with the\nsupport, as needed, of an executive agency or through a partnership\nbetween the Commission and one or more financial institutions.\nSolutions for the operational management of the various instruments\nunder the CEF will be proposed within the appropriate legal\nframework, building on the experience gained with the TEN-T\nExecutive Agency and the existing cooperation with the European\nInvestment Bank.
\nThe Facility will be coordinated with the other\ninterventions coming from the EU budget such as ''Horizon\n2020'' and the Cohesion and Structural Funds.
\nThe Connecting Europe Facility will have a budget of\nEUR 50 billion for the period 2014-2020, allocated as\nfollows:
\n3) Financial instrument within the CEF: the toolbox of instruments should set the base for a\nlong-term stable investment framework and act as a catalyst with a\nview to attracting private capital. The Connecting Europe\nFacility seeks to fill this by two types of main\ninstruments:
\nThe long-term planning, construction and operational\ntime horizon of infrastructure projects also needs a long-term\npreparation to implement financial instruments. This is why,\nsimultaneously to the Connecting Europe Facility proposal, the\nCommission is proposing to launch a pilot phase of the Europe 2020 Project Bond\nInitiative already under the current financial\nframework.
\nThis Communication, entitled “A Budget for\nEurope 2020” contains the Commission’s proposals\nconcerning the Multiannual Financial Framework (MFF) for the\nperiod 2014-2020.
\nThe Commission's ambition for the next EU budget is to\nspend differently, with more emphasis on results and performance,\nconcentrating on delivering the Europe 2020 agenda through stronger\nconditionality in cohesion policy and greening of direct payments\nto farmers.
\nThe next budget should be modernised by reallocating\nresources to priority areas such as pan-European infrastructure,\nresearch and innovation, education and culture, securing the EU's\nexternal borders and external relations policy priorities such as\nthe EU's neighbourhood. It addresses cross-cutting policy\npriorities, such as environmental protection and the fight against\nclimate change, as an integral part of all the main instruments and\ninterventions.
\nThe overall amount proposed for the 2014-2020 period\nis EUR 1 025 000 million in commitment\nappropriations, broken down as\nfollows:
\nIn the design of the next MFF, the Commission has\nimplemented the principles it outlined in the 2010 budget\nreview:
\nThe programmes and instruments included in this MFF\nproposal have been redesigned to ensure that their outputs and\nimpacts push forward the key policy priorities of the EU. Major\nhallmarks of the next set of financial programmes and instruments\nwill be a focus on results, increased use of conditionality and the\nsimplification of delivery:
\n1) Results will be\nclearly related to the implementation of the Europe 2020\nstrategy and the achievement of its targets. This means\nconcentrating programmes on a limited number of high profile\npriorities and actions that achieve a critical mass. Fragmentation\nand uncoordinated interventions must be avoided. Where possible,\nexisting programmes will be merged (for example in areas such as\nhome affairs, education and culture) and/or redesigned (such as\nresearch and cohesion) to ensure integrated programming and a\nsingle set of implementation, reporting and control\nmechanisms.
\n2) Simplification: current funding rules have\nevolved not only in response to the need for accountability on how\npublic money is spent but also to take account of previous\nproblems. The result is a diversity and complexity that is\ndifficult to implement and control. This complexity imposes a heavy\nadministrative burden on beneficiaries as well as on the Commission\nand Member States, which can have the unintended effect of\ndiscouraging participation and delaying implementation. Work is\ncurrently under way to simplify both the general rules (Financial\nRegulation) and the sector specific rules.
\n3) Conditionality: in\norder to sharpen the focus on results rather than on inputs,\nconditionality will be introduced into programmes and instruments.\nThis is particularly relevant in the large spending blocs of\ncohesion policy and agriculture, where Member States and\nbeneficiaries will be required to demonstrate that the funding\nreceived is being used to further the achievement of EU policy\npriorities. More generally the Commission will ensure coherence\nbetween the overall economic policy of the EU and the EU budget, in\nparticular to avoid situations where the effectiveness of EU\nfunding is undermined by unsound macro-fiscal policies.
\n4) Leveraging investment: by working with the private sector on\ninnovative financial instruments it is possible to\nmagnify the impact of the EU budget, enabling a greater number of\nstrategic investments to be made, thus enhancing the EU's growth\npotential. Experience in working most notably with the European\nInvestment Bank (EIB) group, national and international public\nfinancial institutions has been positive and will be taken forward\nin the next MFF. Guarantees and risk sharing arrangements can allow\nthe financial sector to provide more equity and lend more money to\ninnovative companies, or to infrastructure projects. In this way,\nsuch financial instruments can also contribute to the overall\ndevelopment of post-crisis financial markets.
\nThis Communication, entitled “A Budget for\nEurope 2020” contains the Commission’s proposals\nconcerning the Multiannual Financial Framework (MFF) for the\nperiod 2014-2020.
\nThe Commission's ambition for the next EU budget is to\nspend differently, with more emphasis on results and performance,\nconcentrating on delivering the Europe 2020 agenda through stronger\nconditionality in cohesion policy and greening of direct payments\nto farmers.
\nThe next budget should be modernised by reallocating\nresources to priority areas such as pan-European infrastructure,\nresearch and innovation, education and culture, securing the EU's\nexternal borders and external relations policy priorities such as\nthe EU's neighbourhood. It addresses cross-cutting policy\npriorities, such as environmental protection and the fight against\nclimate change, as an integral part of all the main instruments and\ninterventions.
\nThe overall amount proposed for the 2014-2020 period\nis EUR 1 025 000 million in commitment\nappropriations, broken down as\nfollows:
\nIn the design of the next MFF, the Commission has\nimplemented the principles it outlined in the 2010 budget\nreview:
\nThe programmes and instruments included in this MFF\nproposal have been redesigned to ensure that their outputs and\nimpacts push forward the key policy priorities of the EU. Major\nhallmarks of the next set of financial programmes and instruments\nwill be a focus on results, increased use of conditionality and the\nsimplification of delivery:
\n1) Results will be\nclearly related to the implementation of the Europe 2020\nstrategy and the achievement of its targets. This means\nconcentrating programmes on a limited number of high profile\npriorities and actions that achieve a critical mass. Fragmentation\nand uncoordinated interventions must be avoided. Where possible,\nexisting programmes will be merged (for example in areas such as\nhome affairs, education and culture) and/or redesigned (such as\nresearch and cohesion) to ensure integrated programming and a\nsingle set of implementation, reporting and control\nmechanisms.
\n2) Simplification: current funding rules have\nevolved not only in response to the need for accountability on how\npublic money is spent but also to take account of previous\nproblems. The result is a diversity and complexity that is\ndifficult to implement and control. This complexity imposes a heavy\nadministrative burden on beneficiaries as well as on the Commission\nand Member States, which can have the unintended effect of\ndiscouraging participation and delaying implementation. Work is\ncurrently under way to simplify both the general rules (Financial\nRegulation) and the sector specific rules.
\n3) Conditionality: in\norder to sharpen the focus on results rather than on inputs,\nconditionality will be introduced into programmes and instruments.\nThis is particularly relevant in the large spending blocs of\ncohesion policy and agriculture, where Member States and\nbeneficiaries will be required to demonstrate that the funding\nreceived is being used to further the achievement of EU policy\npriorities. More generally the Commission will ensure coherence\nbetween the overall economic policy of the EU and the EU budget, in\nparticular to avoid situations where the effectiveness of EU\nfunding is undermined by unsound macro-fiscal policies.
\n4) Leveraging investment: by working with the private sector on\ninnovative financial instruments it is possible to\nmagnify the impact of the EU budget, enabling a greater number of\nstrategic investments to be made, thus enhancing the EU's growth\npotential. Experience in working most notably with the European\nInvestment Bank (EIB) group, national and international public\nfinancial institutions has been positive and will be taken forward\nin the next MFF. Guarantees and risk sharing arrangements can allow\nthe financial sector to provide more equity and lend more money to\ninnovative companies, or to infrastructure projects. In this way,\nsuch financial instruments can also contribute to the overall\ndevelopment of post-crisis financial markets.
\nIn this communication, the Commission proposes a\nseries of measures in favour of integrated European infrastructures\nto stimulate growth.
\n1) Common challenges: in\nthe past decade, infrastructure spending in Europe has been, on\naverage, on a declining path. The economic and financial crisis\nhas, however, brought renewed interest in the need for\ninfrastructure investment. To be fully operational, the single\nmarket needs modern and high-performance infrastructure\ninterconnecting Europe, particularly in the areas of transport,\nenergy and telecommunications. Yet, while regulatory\nintegration advances within the EU and markets become more\nintegrated, physical, cross-border interconnection is\nlagging. Missing links exist, notably in the newer Member\nStates, creating dividing lines between the centre and peripheries\nof the European Union and hampering the further development of\nintra-community exchanges and growth.
\nOverall investment needs for networks of European\nimportance amount to about EUR 1 trillion for the period up to 2020\nin the three sectors mentioned above: about\nEUR 500 billion in transport, EUR 200 billion in energy and EUR 270\nbillion for fast broadband infrastructures.
\nIn the coming ten years, the EU must find a way to\nrise to this investment challenge. While the market, through\nappropriate investment and pricing mechanisms, is expected to play\na major role in delivering the required infrastructures, without\npublic intervention, some of the necessary investments would\nnot take place or will be delayed far beyond 2020.
\nThis is why the Commission is proposing the\nestablishment of an integrated multisectoral Connecting Europe Facility\n(CEF), complemented by specific guidelines for\nthe transport, energy and telecommunication sectors,\naims at setting up the right conditions to boost infrastructure\ndevelopment, leverage funding from private sources at a time in\nwhich public budgets are severely constrained, and help revitalise\nthe interest of long term specialised investors for investing in\nEurope, thus contributing to growth and job creation.
\n2) Connecting Europe Facility (CEF) – a common\ninfrastructure funding instrument:\nthe aim of the CEF is to streamline and facilitate EU support to\ninfrastructures by optimising the portfolio of instruments\navailable, standardising the operational rules for using them, and\ncapitalise on possible synergies across the three sectors. This\ncoordinated approach will not only ensure the largest possible\nEU added value, but will also simplify procedures and reduce\ncollective costs.
\nTo this end, the CEF proposal develops a common\nfinancing framework for all sectors, including co-ordinated\nannual work programmes, a common Committee, flexibility between\nsectoral budgets, increased performance indicators and\nconditionalities and the shared use of infrastructure specific\nfinancial instruments.
\nCEF funds will be centrally managed, either directly by Commission staff with the\nsupport, as needed, of an executive agency or through a partnership\nbetween the Commission and one or more financial institutions.\nSolutions for the operational management of the various instruments\nunder the CEF will be proposed within the appropriate legal\nframework, building on the experience gained with the TEN-T\nExecutive Agency and the existing cooperation with the European\nInvestment Bank.
\nThe Facility will be coordinated with the other\ninterventions coming from the EU budget such as ''Horizon\n2020'' and the Cohesion and Structural Funds.
\nThe Connecting Europe Facility will have a budget of\nEUR 50 billion for the period 2014-2020, allocated as\nfollows:
\n3) Financial instrument within the CEF: the toolbox of instruments should set the base for a\nlong-term stable investment framework and act as a catalyst with a\nview to attracting private capital. The Connecting Europe\nFacility seeks to fill this by two types of main\ninstruments:
\nThe long-term planning, construction and operational\ntime horizon of infrastructure projects also needs a long-term\npreparation to implement financial instruments. This is why,\nsimultaneously to the Connecting Europe Facility proposal, the\nCommission is proposing to launch a pilot phase of the Europe 2020 Project Bond\nInitiative already under the current financial\nframework.
\nThis Communication, entitled “A Budget for\nEurope 2020” contains the Commission’s proposals\nconcerning the Multiannual Financial Framework (MFF) for the\nperiod 2014-2020.
\nThe Commission's ambition for the next EU budget is to\nspend differently, with more emphasis on results and performance,\nconcentrating on delivering the Europe 2020 agenda through stronger\nconditionality in cohesion policy and greening of direct payments\nto farmers.
\nThe next budget should be modernised by reallocating\nresources to priority areas such as pan-European infrastructure,\nresearch and innovation, education and culture, securing the EU's\nexternal borders and external relations policy priorities such as\nthe EU's neighbourhood. It addresses cross-cutting policy\npriorities, such as environmental protection and the fight against\nclimate change, as an integral part of all the main instruments and\ninterventions.
\nThe overall amount proposed for the 2014-2020 period\nis EUR 1 025 000 million in commitment\nappropriations, broken down as\nfollows:
\nIn the design of the next MFF, the Commission has\nimplemented the principles it outlined in the 2010 budget\nreview:
\nThe programmes and instruments included in this MFF\nproposal have been redesigned to ensure that their outputs and\nimpacts push forward the key policy priorities of the EU. Major\nhallmarks of the next set of financial programmes and instruments\nwill be a focus on results, increased use of conditionality and the\nsimplification of delivery:
\n1) Results will be\nclearly related to the implementation of the Europe 2020\nstrategy and the achievement of its targets. This means\nconcentrating programmes on a limited number of high profile\npriorities and actions that achieve a critical mass. Fragmentation\nand uncoordinated interventions must be avoided. Where possible,\nexisting programmes will be merged (for example in areas such as\nhome affairs, education and culture) and/or redesigned (such as\nresearch and cohesion) to ensure integrated programming and a\nsingle set of implementation, reporting and control\nmechanisms.
\n2) Simplification: current funding rules have\nevolved not only in response to the need for accountability on how\npublic money is spent but also to take account of previous\nproblems. The result is a diversity and complexity that is\ndifficult to implement and control. This complexity imposes a heavy\nadministrative burden on beneficiaries as well as on the Commission\nand Member States, which can have the unintended effect of\ndiscouraging participation and delaying implementation. Work is\ncurrently under way to simplify both the general rules (Financial\nRegulation) and the sector specific rules.
\n3) Conditionality: in\norder to sharpen the focus on results rather than on inputs,\nconditionality will be introduced into programmes and instruments.\nThis is particularly relevant in the large spending blocs of\ncohesion policy and agriculture, where Member States and\nbeneficiaries will be required to demonstrate that the funding\nreceived is being used to further the achievement of EU policy\npriorities. More generally the Commission will ensure coherence\nbetween the overall economic policy of the EU and the EU budget, in\nparticular to avoid situations where the effectiveness of EU\nfunding is undermined by unsound macro-fiscal policies.
\n4) Leveraging investment: by working with the private sector on\ninnovative financial instruments it is possible to\nmagnify the impact of the EU budget, enabling a greater number of\nstrategic investments to be made, thus enhancing the EU's growth\npotential. Experience in working most notably with the European\nInvestment Bank (EIB) group, national and international public\nfinancial institutions has been positive and will be taken forward\nin the next MFF. Guarantees and risk sharing arrangements can allow\nthe financial sector to provide more equity and lend more money to\ninnovative companies, or to infrastructure projects. In this way,\nsuch financial instruments can also contribute to the overall\ndevelopment of post-crisis financial markets.
\nThis Communication, entitled “A Budget for\nEurope 2020” contains the Commission’s proposals\nconcerning the Multiannual Financial Framework (MFF) for the\nperiod 2014-2020.
\nThe Commission's ambition for the next EU budget is to\nspend differently, with more emphasis on results and performance,\nconcentrating on delivering the Europe 2020 agenda through stronger\nconditionality in cohesion policy and greening of direct payments\nto farmers.
\nThe next budget should be modernised by reallocating\nresources to priority areas such as pan-European infrastructure,\nresearch and innovation, education and culture, securing the EU's\nexternal borders and external relations policy priorities such as\nthe EU's neighbourhood. It addresses cross-cutting policy\npriorities, such as environmental protection and the fight against\nclimate change, as an integral part of all the main instruments and\ninterventions.
\nThe overall amount proposed for the 2014-2020 period\nis EUR 1 025 000 million in commitment\nappropriations, broken down as\nfollows:
\nIn the design of the next MFF, the Commission has\nimplemented the principles it outlined in the 2010 budget\nreview:
\nThe programmes and instruments included in this MFF\nproposal have been redesigned to ensure that their outputs and\nimpacts push forward the key policy priorities of the EU. Major\nhallmarks of the next set of financial programmes and instruments\nwill be a focus on results, increased use of conditionality and the\nsimplification of delivery:
\n1) Results will be\nclearly related to the implementation of the Europe 2020\nstrategy and the achievement of its targets. This means\nconcentrating programmes on a limited number of high profile\npriorities and actions that achieve a critical mass. Fragmentation\nand uncoordinated interventions must be avoided. Where possible,\nexisting programmes will be merged (for example in areas such as\nhome affairs, education and culture) and/or redesigned (such as\nresearch and cohesion) to ensure integrated programming and a\nsingle set of implementation, reporting and control\nmechanisms.
\n2) Simplification: current funding rules have\nevolved not only in response to the need for accountability on how\npublic money is spent but also to take account of previous\nproblems. The result is a diversity and complexity that is\ndifficult to implement and control. This complexity imposes a heavy\nadministrative burden on beneficiaries as well as on the Commission\nand Member States, which can have the unintended effect of\ndiscouraging participation and delaying implementation. Work is\ncurrently under way to simplify both the general rules (Financial\nRegulation) and the sector specific rules.
\n3) Conditionality: in\norder to sharpen the focus on results rather than on inputs,\nconditionality will be introduced into programmes and instruments.\nThis is particularly relevant in the large spending blocs of\ncohesion policy and agriculture, where Member States and\nbeneficiaries will be required to demonstrate that the funding\nreceived is being used to further the achievement of EU policy\npriorities. More generally the Commission will ensure coherence\nbetween the overall economic policy of the EU and the EU budget, in\nparticular to avoid situations where the effectiveness of EU\nfunding is undermined by unsound macro-fiscal policies.
\n4) Leveraging investment: by working with the private sector on\ninnovative financial instruments it is possible to\nmagnify the impact of the EU budget, enabling a greater number of\nstrategic investments to be made, thus enhancing the EU's growth\npotential. Experience in working most notably with the European\nInvestment Bank (EIB) group, national and international public\nfinancial institutions has been positive and will be taken forward\nin the next MFF. Guarantees and risk sharing arrangements can allow\nthe financial sector to provide more equity and lend more money to\ninnovative companies, or to infrastructure projects. In this way,\nsuch financial instruments can also contribute to the overall\ndevelopment of post-crisis financial markets.
\nIn this communication, the Commission proposes a\nseries of measures in favour of integrated European infrastructures\nto stimulate growth.
\n1) Common challenges: in\nthe past decade, infrastructure spending in Europe has been, on\naverage, on a declining path. The economic and financial crisis\nhas, however, brought renewed interest in the need for\ninfrastructure investment. To be fully operational, the single\nmarket needs modern and high-performance infrastructure\ninterconnecting Europe, particularly in the areas of transport,\nenergy and telecommunications. Yet, while regulatory\nintegration advances within the EU and markets become more\nintegrated, physical, cross-border interconnection is\nlagging. Missing links exist, notably in the newer Member\nStates, creating dividing lines between the centre and peripheries\nof the European Union and hampering the further development of\nintra-community exchanges and growth.
\nOverall investment needs for networks of European\nimportance amount to about EUR 1 trillion for the period up to 2020\nin the three sectors mentioned above: about\nEUR 500 billion in transport, EUR 200 billion in energy and EUR 270\nbillion for fast broadband infrastructures.
\nIn the coming ten years, the EU must find a way to\nrise to this investment challenge. While the market, through\nappropriate investment and pricing mechanisms, is expected to play\na major role in delivering the required infrastructures, without\npublic intervention, some of the necessary investments would\nnot take place or will be delayed far beyond 2020.
\nThis is why the Commission is proposing the\nestablishment of an integrated multisectoral Connecting Europe Facility\n(CEF), complemented by specific guidelines for\nthe transport, energy and telecommunication sectors,\naims at setting up the right conditions to boost infrastructure\ndevelopment, leverage funding from private sources at a time in\nwhich public budgets are severely constrained, and help revitalise\nthe interest of long term specialised investors for investing in\nEurope, thus contributing to growth and job creation.
\n2) Connecting Europe Facility (CEF) – a common\ninfrastructure funding instrument:\nthe aim of the CEF is to streamline and facilitate EU support to\ninfrastructures by optimising the portfolio of instruments\navailable, standardising the operational rules for using them, and\ncapitalise on possible synergies across the three sectors. This\ncoordinated approach will not only ensure the largest possible\nEU added value, but will also simplify procedures and reduce\ncollective costs.
\nTo this end, the CEF proposal develops a common\nfinancing framework for all sectors, including co-ordinated\nannual work programmes, a common Committee, flexibility between\nsectoral budgets, increased performance indicators and\nconditionalities and the shared use of infrastructure specific\nfinancial instruments.
\nCEF funds will be centrally managed, either directly by Commission staff with the\nsupport, as needed, of an executive agency or through a partnership\nbetween the Commission and one or more financial institutions.\nSolutions for the operational management of the various instruments\nunder the CEF will be proposed within the appropriate legal\nframework, building on the experience gained with the TEN-T\nExecutive Agency and the existing cooperation with the European\nInvestment Bank.
\nThe Facility will be coordinated with the other\ninterventions coming from the EU budget such as ''Horizon\n2020'' and the Cohesion and Structural Funds.
\nThe Connecting Europe Facility will have a budget of\nEUR 50 billion for the period 2014-2020, allocated as\nfollows:
\n3) Financial instrument within the CEF: the toolbox of instruments should set the base for a\nlong-term stable investment framework and act as a catalyst with a\nview to attracting private capital. The Connecting Europe\nFacility seeks to fill this by two types of main\ninstruments:
\nThe long-term planning, construction and operational\ntime horizon of infrastructure projects also needs a long-term\npreparation to implement financial instruments. This is why,\nsimultaneously to the Connecting Europe Facility proposal, the\nCommission is proposing to launch a pilot phase of the Europe 2020 Project Bond\nInitiative already under the current financial\nframework.
\nPURPOSE: presentation by the Commission of the\nconsolidated annual accounts of the European Union for the\nfinancial year 2010, as part of the 2010 discharge\nprocedure.
\nAnalysis of the accounts of the EU Institutions:\nSection I - European Parliament.
\nCONTENT: this Commission document sets out the\nconsolidated annual accounts of the European Union for the\nfinancial year 2010 as prepared on the basis of the information\npresented by the institutions, organisations and bodies of the EU,\nin accordance with Article 129 (2) of the Financial Regulation\napplicable to the EU's General Budget, including the European\nParliament.
\n(1) Purpose: the\ndocument helps to bring insight into the EU budget mechanism and\nthe way in which the budget has been managed and spent in\n2010. It recalls that European Union's operational expenditure\ncovers the various headings of the financial framework and takes\ndifferent forms, depending on how the money is paid out and\nmanaged.
\nIn accordance with the Financial Regulation, the\nCommission implements the general budget using the following\nmethods: direct centralised management: direct implementation of\nthe budget by the Commission services; indirect centralised\nmanagement: the Commission confers tasks of implementation of the\nbudget to bodies of EU law or national law, such as the EU agencies\nof public law or with public service missions; decentralised\nmanagement: the Commission delegates certain tasks for\nimplementation of the budget to third countries; shared management:\nunder this method of management budget implementation tasks are\ndelegated to Member States. The majority of the expenditure falls\nunder this mode \"Shared Management\" involving the delegation of\ntasks to Member States, covering such areas as agricultural\nspending and Structural Actions.
\nThe document also presents the different financial\nactors involved in the budget process (accounting officers,\ninternal officers and authorising officers) and recalls their\nrespective roles in the context of the tasks of sound financial\nmanagement.
\nAmongst the other legal elements relating to the\nimplementation of the EU budget presented in this document, the\npaper focuses on the following issues:
\nTo recall, the final control is the discharge of\nthe budget for a given financial year. The discharge represents\nthe political aspect of the external control of budget\nimplementation and is the decision by which the European\nParliament, acting on a Council recommendation, \"releases\" the\nCommission from its responsibility for management of a given budget\nby marking the end of that budget's existence (please refer to the\nfollow-up reports presented in this procedure file).
\nLastly, the document presents a series of tables and\ndetailed technical indicators on (i) the balance sheet; (ii) the\neconomic outturn account; (iii) cashflow tables; (iv) technical\nannexes concerning the financial statements.
\n(2) Implementation of\nappropriations under Section I of the budget for the financial year\n2010: the\ndocument comprises a series of detailed tables, the most important\nconcerning the implementation of the budget. Concerning the\nEuropean Parliament's expenditure, the table on the financial and\nbudgetary implementation of this institution shows the\nfollowing:
\nA) Table showing the commitment\nappropriations:
\nCommitments: EUR 1 586 million (90.5% rate\nof implementation)
\nCarry-overs to 2011: EUR 111 million (6.31% of\nauthorised appropriations)
\nCancelled: EUR 56 million
\nB) Table showing the\nimplementation of payments:
\nPayments: EUR 1 506 million (77.74% rate\nof implementation)
\nCarry-overs to 2011: EUR 351 million (18.10% of\nauthorised appropriations)
\nCancellations: EUR 81 million.
\nLastly, the annexes detail specific expenditure of the\ninstitutions, in particular:
\n(3) Budget implementation –\nconclusions: following the 2009\nEuropean elections, in 2010 the Parliament gradually resumed full\nactivity during the year. It was a year of continued adaptation as\nconcerns the improvement of working methods and modernisation,\nwhich go hand in hand with its political and legislative\nresponsibilities, and the evaluation concerning a series of major\nmultiannual initiatives launched during the past few\nyears.
\nFollowing the ratification of the Lisbon Treaty and\nits entry into force on 1 December 2009, necessary adaptations\nrequiring budget expenditure had to be dealt with. An amending\nbudget 1/2010 was adopted on 19 May 2010 amounting to EUR 9 397\n164 to finance additional expenditure directly stemming from\nthe entry into force of the Lisbon Treaty amending the Treaty on\nEuropean Union and the Treaty establishing the European Community.\nThe amending budget increased the staff figures by 150. A total of\n75 temporary posts reinforced the assistance to Political groups,\n70 posts were assigned to committees’ secretariats and 5 posts\nwere dedicated to the Directorate for the Relations with National\nParliaments. Two budget items were strengthened in particular: Item\n1 2 0 0 ‘Remuneration and allowances’ and Item 4 2 2 0/01\n‘Parliamentary assistance: local assistants’.
\nFor further details on the budgetary implementation of\nexpenditure of Section I of the budget (European Parliament),\nplease refer to the Report on budgetary and financial management\nfor the financial year 2010 (European\nParliament).
\nPURPOSE: presentation of the report of the Court of\nAuditors on the implementation of the 2010 EU Budget (Section I\n– European Parliament.
\nCONTENT: the European Court of Auditors (ECA)\npublished its 34th annual report on the implementation\nof the 2010 EU General Budget.
\nIn accordance with the tasks and objectives assigned\nto it by the Treaty on the Functioning of the EU (TFEU), in the\ncontext of the discharge procedure, the Court of Auditors provides,\nboth for the European Parliament and the Council, a statement of\nassurance (“DAS”) on the reliability of the accounts, as\nwell as the legality and regularity of transactions of each EU\ninstitution, body or agency, on the basis of an independent\nexternal audit.
\nThis audit also dealt with the European\nParliament’s financial implementation.
\nOn the basis of these audits, the Court considers that\nthe payments in the policy group “Administrative and other\nexpenditure” were free from material error. The estimated\nrate of error is 0.4%.
\nThe ECA found that supervisory and control systems for\nadministrative and other expenditure were effective in ensuring the\nregularity of payments. However, the ECA found a number of\nerrors and weaknesses in the implementation of procurement\nprocedures by the EU institutions and bodies. Recruitment\ndecisions were also not always appropriately documented. These\nweaknesses were not material for the policy group as a whole, but\nwere significant in the context of the individual institution or\nbody concerned and need to be addressed by their\nadministrations.
\nThe ECA recommends the EU institutions and bodies\nshould ensure that:
\nThe Court also makes a number of observations in\nregard to each EU institution or body and do not call into question\nthe overall positive assessments given that they do not have a\nsignificant effect on the overall administrative expenditures\nundertaken.
\nIn the specific case of the audit of the European\nParliament, the ECA notes the following points:
\nFollow-up on the observations in the ECA’s 2009\nannual report: in regard to the\npayment of social allowances to staff members, the Court\nindicated that staff should be requested to deliver at appropriate\nintervals documents confirming their personal situation. In\naddition, the Parliament should implement a system for the timely\nmonitoring and control of these documents. Parliament indicated in\nresponse that it had implemented measures to mitigate the risk:\nlaunching of a campaign to check eligibility for some allowances,\nwhich led to the recovery of more than 70 000 euro;
\nHaving regard to the observations made in the Court of\nAuditor's report, the Council calls on the European Parliament to\ngive a discharge to all of the other institutions of the\nEuropean Union in respect of the implementation of the budget of\nthe European Union for the financial year 2010.
\nAlthough the Council notes with satisfaction that,\nagain in 2010, the administrative expenditure of EU institutions\nand bodies continued to remain free from material error and that\ntheir supervisory and control systems continued to be effective\nin ensuring compliance with the requirements of the Financial\nRegulation, it makes a series of case-specific comments.
\nAs regards the European Parliament, the Council\nwelcomes the remedial action already taken by the institution\nconcerned and encourages it to address the remaining weaknesses\npointed out by the Court.
\nAs regards weaknesses identified by the Court in the\nrecruitment procedures of the European Parliament, the\nCouncil supports the Court's recommendation to establish\nappropriate documentation and to respect eligibility criteria as\nstrictly as possible.
\nLastly, concerning the problems in procurement\nprocedures noted in the European Parliament, the Council\nsupports the Court's recommendation that authorising officers\nshould have appropriate checks at their disposal and receive better\nguidance, to diminish the risk of error when applying the rules,\neven when these rules are considered to be complex.
\nThe Committee on Budgetary Control adopted the report\nby Bogusław LIBERADZKI (S&D, PL) in which it calls on the\nEuropean Parliament to grant discharge to its President in respect\nof the implementation of the European Parliament budget for the\nfinancial year 2010.
\nMembers recall that the Secretary-General certified,\non 16 June 2011, his reasonable assurance that Parliament's budget\nhas been implemented in accordance with the principles of sound\nfinancial management and that the control framework put in place\nprovides the necessary guarantees as to the legality and regularity\nof the underlying operations. However, some issues raised\nquestions. This is why Members make a number of recommendations on\nthe implementation of the Parliament’s budget that need to be\ntaken into account when the discharge is granted:
\nBudget implementation challenges in\n2010: Members point out that\nimplementation of the budget in 2010 was challenging as that was\nthe first full year of operations after the 2009 European elections\nand took place in the context of continuing financial problems in\nthe Union. They observe that Parliament's budget (final\nappropriations totalling EUR 1 616 760 399,
\ncompared to EUR 1 529 970 930 in 2009) was just under\na fifth of Heading V (Administration expenditure) in the\ngeneral budget of the European Union for 2010.
\nMembers note that the annual cost of\nParliament’s seat in Strasbourg stood at precisely EUR 51.5\nmillion in 2010, these official figures are far lower than the\nestimates previously put forward, which ranged from EUR 169 million\nto EUR 203 million.
\nFurthermore, Members note:
\nReport on budgetary and financial\nmanagement: noting that, in 2010, 96%\nof the final appropriations were committed, with a cancellation\nrate of 4%, Members note, however, the significant\ncarry-overs into 2010 (EUR 190 million), resulting, to a large\nextent, from the particular nature of the 2009 election year. They\ncall for improved planning of expenditure that will take this into\naccount in the run up to future European elections.
\nStatement of assurance by the\nSecretary-General: Members welcome\nthe positive Statement of assurance (DAS) by the Secretary-General\nand notes in particular the efforts made in public procurement\nprocedures, notably in the framework of negotiated procedures which\nwere subject to increased transparency.
\nThey note that the Court of Auditors highlighted\nthat:
\nMembers welcome however the overall quality of the\ninternal audit reports.
\nManagement of EP services: Members observe with satisfaction that all\nDirectors-General were able to give an unreserved statement of\nassurance in respect of the implementation of the budget by their\nservices in 2010.
\nFocusing on each of the services concerned, Members\nhighlight the following issues:
\nEnvironment-friendly Parliament: Members welcome the CO2 action plan adopted by the\nBureau in 2010 which resulted in the significant reduction in\nenergy consumption at the Strasbourg seat of Parliament, which fell\nby 74 % between 2006 and 2010. They take the view that the\npossibility should be considered of making both environmental\nimprovements and savings in Parliament’s budget by means of\ndifferent working methods which are greener and cheaper but do not\ndetract from Parliament’s work, including the use of\nteleconferences. They welcome the adoption by the Bureau of the\nproposal from the Working Group on Buildings, Transport and Green\nParliament revising the rules governing the use of official cars by\nMembers that has allowed Parliament to modernise its fleet with\nless polluting cars and to organise grouped transport with VIP\nminibuses to airports in Brussels and Strasbourg.
\nThe European Parliament adopted by 519 votes to 92,\nwith 33 abstentions, a decision to grant discharge to its President\nin respect of the implementation of the European Parliament budget\nfor the financial year 2010.
\nParliament recalls that the Secretary-General\ncertified, on 16 June 2011, his reasonable assurance that\nParliament's budget has been implemented in accordance with the\nprinciples of sound financial management and that the control\nframework put in place provides the necessary guarantees as to the\nlegality and regularity of the underlying operations. However, some\nissues raised questions. This is why a number of recommendations on\nthe implementation of the Parliament’s budget were made that\nneed to be taken into account when the discharge is granted. These\nwere laid down in a resolution which was adopted in plenary by 536\nvotes to 88, with 23 abstentions.
\nBeyond the discharge procedure: Parliament noted that that some issues raised in the\ncourse of the discussions on the 2010 discharge in the Committee on\nBudgetary Control went beyond the specific 2010 issues, and were\nincluded in wide-ranging questions from the Committee. This\nresolution remains principally focussed on the budget\nimplementation and discharge for the financial year 2010, whilst\nacknowledging that approaches to budgetary matters are a subject\nfor wider discussion particularly in the working group being\nestablished to consider European Parliament costs and possible\nsavings, and in line with the 2013 budget guidelines adopted on 8\nFebruary 2012, seeking to make significant long-term savings,\nthrough an independent evaluation of the European Parliament budget\nleading to proposals by the end of 2012 followed by their rapid\nimplementation.
\nChallenges in the implementation of the 2010 budget,\nthe issue of Parliament’s single seat: Parliament notes that implementation of the budget\nin 2010 was challenging as that was the first full year of\noperations after the 2009 European elections and took place in the\ncontext of continuing financial problems in the Union. It observes\nthat Parliament's budget (final appropriations totalling EUR 1 616\n760 399, compared to EUR 1 529 970 930 in 2009) was just under a\nfifth (19.99 %; 19.67 % in 2009, therefore below the usual 20 %\nshare) of Heading V (Administration expenditure) in the general\nbudget of the European Union for 2010. Parliament also notes the\nreply given by Parliament's Secretariat to the effect that the\nannual cost of Parliament's seat in Strasbourg stood at precisely\nEUR 51.5 million in 2010 ( figures that are far lower than the\nestimates previously put forward, which ranged from EUR 169 million\nto 203 million. Plenary notes however that in the 2006 estimates\nthe Administration calculated the annual saving with a single place\nof work at EUR 204 million and in 2010 at EUR 180 million, a\nlower figure after the purchase of the Strasbourg buildings and\ninformation technology improvements, and recalls that in its 2013\nestimates, the European Parliament voted 429-184 in favour of a\nsingle seat to save costs.
\nFurthermore, Parliament notes:
\nPublic procurement: limiting the negotiated\nprocedures: Parliament calls on the\nDirectorates General to further reduce the number/proportion of\nsuch procedures. It urges the administration to continue the strict\nscrutiny of these procedures, in particular with respect to\npossible conflicts of interest, and to apply intensified and\ndissuasive sanctions for any irregularity found. Plenary calls on\nthe Secretary-General to report on a six-monthly basis to the\nCommittee on Budgetary Control on progress made. Parliament calls\non the Bureau to reconsider all control mechanisms for public\nprocurement in order to guarantee the most competitive prices for\nthe goods and services that are offered.
\nStatement of assurance by the\nSecretary-General: Parliament\nwelcomes the positive Statement of assurance (DAS) by the\nSecretary-General and notes in particular the efforts made in\npublic procurement procedures, notably in the framework of\nnegotiated procedures which were subject to increased\ntransparency.
\nIt notes that the Court of Auditors highlighted\nthat:
\nMembers welcome however the overall quality of the\ninternal audit reports.
\nManagement of EP services: Parliament observes with satisfaction that all\nDirectors-General were able to give an unreserved statement of\nassurance in respect of the implementation of the budget by their\nservices in 2010.
\nFocusing on each of the services concerned, Members\nhighlight the following issues:
\nEnvironment-friendly Parliament: Parliament welcomes the CO2 action plan adopted by\nthe Bureau in 2010 which resulted in the significant reduction in\nenergy consumption at the Strasbourg seat of Parliament, which fell\nby 74 % between 2006 and 2010. It takes the view that the\npossibility should be considered of making both environmental\nimprovements and savings in Parliament’s budget by means of\ndifferent working methods which are greener and cheaper but do not\ndetract from Parliament’s work, including the use of\nteleconferences. It welcomes the adoption by the Bureau of the\nproposal from the Working Group on Buildings, Transport and Green\nParliament revising the rules governing the use of official cars by\nMembers that has allowed Parliament to modernise its fleet with\nless polluting cars and to organise grouped transport with VIP\nminibuses to airports in Brussels and Strasbourg.
\nPURPOSE: presentation of the Court of Auditors’\nreport on the implementation of the budget concerning the financial\nyear 2010 (Section IX - European Data Protection\nSupervisor).
\nCONTENT: the Court of Auditors presents its 34th\nannual report on the implementation of the budget concerning the\nfinancial year 2010.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court presents to the\nEuropean Parliament and to the Council in the framework of the\ndischarge procedure, the statement of assurance (the\n‘DAS’) on the reliability of the annual accounts of the\nEU and on the legality and regularity of transactions underlying\nthose accounts for each institution and organ of the EU, on the\nbasis of an external audit.
\nThis audit included the financial implementation of\nthe European Data Protection Supervisor (EDPS).
\nBased on its audit work, the Court concludes that the\npayments as a whole for administrative and other expenditure were\nfree from material error. The most likely rate of error is 0.4\n%.
\nThe Court again concludes that the supervisory and\ncontrol systems for administrative and other expenditure were\neffective in ensuring the regularity of payments. However, the\nCourt noted a certain number of errors and weaknesses in the\nimplementation of public procurement procedures by the institutions\nand bodies of the EU. Decisions regarding recruitment were not\nalways correctly recorded. These weaknesses are not significant for\nall policy groups taken together, but are significant in the\ncontext of each institution or body and must be taken into\nconsideration by administrators.
\nAccordingly, the Court recommends to the institutions\nand bodies of the EU:
\nThe Court makes a certain number of particular\nobservations as regards each EU institution or body of the European\nUnion and which do not call into question the overall positive\nassessments set out above because they do not affect significantly\nadministrative expenses as a whole.
\nIn the specific case of the EDPS, the Court\nparticularly notes the following points:
\nPURPOSE: to present the report of the Court of\nAuditors on the implementation of the budget for the financial year\n2010 (Section VIII - European Ombudsman).
\nCONTENT: this is the Court’s 34th Annual Report\non the implementation of the EU budget. It covers the 2010\nfinancial year.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court has audited: (a)\nthe annual accounts of the European Union which comprise the\nconsolidated financial statements and the consolidated reports on\nimplementation of the budget for the financial year ended 31\nDecember 2010; and (b) the legality and regularity of the\ntransactions underlying those accounts.
\nThe central part of the annual report is the\nCourt’s statement of assurance (the ‘DAS’) on the\nreliability of the annual accounts of the EU and on the legality\nand regularity of transactions (referred to in the report as\n‘regularity of transactions’). The statement of assurance\nitself begins the report; the material which follows reports mainly\non the audit work underlying the statement of assurance.
\nThis particular audit concerns the budget\nimplementation of the European Ombudsman.
\nBased on its audit testing, the ECA concludes\nthat the payments for the policy group Administrative and other\nexpenditure were on the whole free from material error. The\nestimated error rate was 0.4%.
\nThe Court found that supervisory and control\nsystems for administrative and other expenditure were effective in\nensuring the regularity of payments. However, the ECA found a\nnumber of errors and weaknesses in the implementation of\nprocurement procedures by the EU institutions and bodies, and in\none institution repeated under-utilisation of certain budget lines\nresulting in significant budget transfers to finance building\nprojects. Recruitment decisions were also not always appropriately\ndocumented. These weaknesses were not material for the policy group\nas a whole, but were significant in the context of the individual\ninstitution or body concerned and need to be addressed by their\nadministrations.
\nFor 2010, the ECA recommends the EU\ninstitutions and bodies should ensure that:
\nThe Court makes a certain number of particular\nobservations as regards each EU institution or body of the European\nUnion and which do not call into question the overall positive\nassessments set out above because they do not affect significantly\nadministrative expenses as a whole. However, in the specific case\nof the audit of the Ombudsman, the Court of Auditors made\nno specific observation.
\nPURPOSE: to present the report of the Court of\nAuditors on the implementation of the budget for the financial year\n2010 (Section VII – Committee of the Regions).
\nCONTENT: this is the Court’s 34th Annual Report\non the implementation of the EU budget. It covers the 2010\nfinancial year.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court has audited: (a)\nthe annual accounts of the European Union which comprise the\nconsolidated financial statements and the consolidated reports on\nimplementation of the budget for the financial year ended 31\nDecember 2010; and (b) the legality and regularity of the\ntransactions underlying those accounts.
\nThe central part of the annual report is the\nCourt’s statement of assurance (the ‘DAS’) on the\nreliability of the annual accounts of the EU and on the legality\nand regularity of transactions (referred to in the report as\n‘regularity of transactions’). The statement of assurance\nitself begins the report; the material which follows reports mainly\non the audit work underlying the statement of assurance.
\nThis particular audit concerns the budget\nimplementation of the Committee of the Regions.
\nBased on its audit testing, the ECA concludes\nthat the payments for the policy group Administrative and other\nexpenditure were on the whole free from material error. The\nestimated error rate was 0.4%.
\nThe Court found that supervisory and control\nsystems for administrative and other expenditure were effective in\nensuring the regularity of payments. However, the ECA found a\nnumber of errors and weaknesses in the implementation of\nprocurement procedures by the EU institutions and bodies, and in\none institution repeated under-utilisation of certain budget lines\nresulting in significant budget transfers to finance building\nprojects. Recruitment decisions were also not always appropriately\ndocumented. These weaknesses were not material for the policy group\nas a whole, but were significant in the context of the individual\ninstitution or body concerned and need to be addressed by their\nadministrations.
\nFor 2010, the ECA recommends the EU\ninstitutions and bodies should ensure that:
\nThe Court makes a\ncertain number of particular observations as regards each EU\ninstitution or body of the European Union and which do not call\ninto question the overall positive assessments set out above\nbecause they do not affect significantly\nadministrative expenses as a whole.
\nIn the particular case of the Committee of the\nRegions, the Court notes the following issues:
\nPURPOSE: presentation of the Court of Auditors’\nreport on the implementation of the budget concerning the financial\nyear 2010 (Section IX - European Data Protection\nSupervisor).
\nCONTENT: the Court of Auditors presents its 34th\nannual report on the implementation of the budget concerning the\nfinancial year 2010.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court presents to the\nEuropean Parliament and to the Council in the framework of the\ndischarge procedure, the statement of assurance (the\n‘DAS’) on the reliability of the annual accounts of the\nEU and on the legality and regularity of transactions underlying\nthose accounts for each institution and organ of the EU, on the\nbasis of an external audit.
\nThis audit included the financial implementation of\nthe European Data Protection Supervisor (EDPS).
\nBased on its audit work, the Court concludes that the\npayments as a whole for administrative and other expenditure were\nfree from material error. The most likely rate of error is 0.4\n%.
\nThe Court again concludes that the supervisory and\ncontrol systems for administrative and other expenditure were\neffective in ensuring the regularity of payments. However, the\nCourt noted a certain number of errors and weaknesses in the\nimplementation of public procurement procedures by the institutions\nand bodies of the EU. Decisions regarding recruitment were not\nalways correctly recorded. These weaknesses are not significant for\nall policy groups taken together, but are significant in the\ncontext of each institution or body and must be taken into\nconsideration by administrators.
\nAccordingly, the Court recommends to the institutions\nand bodies of the EU:
\nThe Court makes a certain number of particular\nobservations as regards each EU institution or body of the European\nUnion and which do not call into question the overall positive\nassessments set out above because they do not affect significantly\nadministrative expenses as a whole.
\nIn the specific case of the EDPS, the Court\nparticularly notes the following points:
\nPURPOSE: to present the report of the Court of\nAuditors on the implementation of the budget for the financial year\n2010 (Section VI – European Social and Economic\nCommittee).
\nCONTENT: this is the Court’s 34th Annual Report\non the implementation of the EU budget. It covers the 2010\nfinancial year.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court has audited: (a)\nthe annual accounts of the European Union which comprise the\nconsolidated financial statements and the consolidated reports on\nimplementation of the budget for the financial year ended 31\nDecember 2010; and (b) the legality and regularity of the\ntransactions underlying those accounts.
\nThe central part of the annual report is the\nCourt’s statement of assurance (the ‘DAS’) on the\nreliability of the annual accounts of the EU and on the legality\nand regularity of transactions (referred to in the report as\n‘regularity of transactions’). The statement of assurance\nitself begins the report; the material which follows reports mainly\non the audit work underlying the statement of assurance.
\nThis particular audit\nconcerns the budget implementation of the European Social and\nEconomic Committee.
\nBased on its audit testing, the ECA concludes\nthat the payments for the policy group Administrative and other\nexpenditure were on the whole free from material error. The\nestimated error rate was 0.4%.
\nThe Court found that supervisory and control\nsystems for administrative and other expenditure were effective in\nensuring the regularity of payments. However, the ECA found a\nnumber of errors and weaknesses in the implementation of\nprocurement procedures by the EU institutions and bodies, and\nin one institution repeated under-utilisation of certain budget\nlines resulting in significant budget transfers to finance building\nprojects. Recruitment decisions were also not always appropriately\ndocumented. These weaknesses were not material for the policy group\nas a whole, but were significant in the context of the individual\ninstitution or body concerned and need to be addressed by their\nadministrations.
\nFor 2010, the ECA recommends the EU\ninstitutions and bodies should ensure that:
\nThe Court makes a certain number of particular\nobservations as regards each EU institution or body of the European\nUnion and which do not call into question the overall positive\nassessments set out above because they do not affect significantly\nadministrative expenses as a whole.
\nIn the particular case of the European Social and\nEconomic Committee, the Court notes the following\nissues:
\nPURPOSE: to present the report of the Court of\nAuditors on the implementation of the budget for the financial year\n2010 (Section VIII - European Ombudsman).
\nCONTENT: this is the Court’s 34th Annual Report\non the implementation of the EU budget. It covers the 2010\nfinancial year.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court has audited: (a)\nthe annual accounts of the European Union which comprise the\nconsolidated financial statements and the consolidated reports on\nimplementation of the budget for the financial year ended 31\nDecember 2010; and (b) the legality and regularity of the\ntransactions underlying those accounts.
\nThe central part of the annual report is the\nCourt’s statement of assurance (the ‘DAS’) on the\nreliability of the annual accounts of the EU and on the legality\nand regularity of transactions (referred to in the report as\n‘regularity of transactions’). The statement of assurance\nitself begins the report; the material which follows reports mainly\non the audit work underlying the statement of assurance.
\nThis particular audit concerns the budget\nimplementation of the European Ombudsman.
\nBased on its audit testing, the ECA concludes\nthat the payments for the policy group Administrative and other\nexpenditure were on the whole free from material error. The\nestimated error rate was 0.4%.
\nThe Court found that supervisory and control\nsystems for administrative and other expenditure were effective in\nensuring the regularity of payments. However, the ECA found a\nnumber of errors and weaknesses in the implementation of\nprocurement procedures by the EU institutions and bodies, and in\none institution repeated under-utilisation of certain budget lines\nresulting in significant budget transfers to finance building\nprojects. Recruitment decisions were also not always appropriately\ndocumented. These weaknesses were not material for the policy group\nas a whole, but were significant in the context of the individual\ninstitution or body concerned and need to be addressed by their\nadministrations.
\nFor 2010, the ECA recommends the EU\ninstitutions and bodies should ensure that:
\nThe Court makes a certain number of particular\nobservations as regards each EU institution or body of the European\nUnion and which do not call into question the overall positive\nassessments set out above because they do not affect significantly\nadministrative expenses as a whole. However, in the specific case\nof the audit of the Ombudsman, the Court of Auditors made\nno specific observation.
\nPURPOSE: presentation of the Court of Auditors’\nreport on the implementation of the budget concerning the financial\nyear 2010 (Section IX - European Data Protection\nSupervisor).
\nCONTENT: the Court of Auditors presents its 34th\nannual report on the implementation of the budget concerning the\nfinancial year 2010.
\nPursuant to the provisions of the Treaty on the\nFunctioning of the European Union (TFEU) the Court presents to the\nEuropean Parliament and to the Council in the framework of the\ndischarge procedure, the statement of assurance (the\n‘DAS’) on the reliability of the annual accounts of the\nEU and on the legality and regularity of transactions underlying\nthose accounts for each institution and organ of the EU, on the\nbasis of an external audit.
\nThis audit included the financial implementation of\nthe European Data Protection Supervisor (EDPS).
\nBased on its audit work, the Court concludes that the\npayments as a whole for administrative and other expenditure were\nfree from material error. The most likely rate of error is 0.4\n%.
\nThe Court again concludes that the supervisory and\ncontrol systems for administrative and other expenditure were\neffective in ensuring the regularity of payments. However, the\nCourt noted a certain number of errors and weaknesses in the\nimplementation of public procurement procedures by the institutions\nand bodies of the EU. Decisions regarding recruitment were not\nalways correctly recorded. These weaknesses are not significant for\nall policy groups taken together, but are significant in the\ncontext of each institution or body and must be taken into\nconsideration by administrators.
\nAccordingly, the Court recommends to the institutions\nand bodies of the EU:
\nThe Court makes a certain number of particular\nobservations as regards each EU institution or body of the European\nUnion and which do not call into question the overall positive\nassessments set out above because they do not affect significantly\nadministrative expenses as a whole.
\nIn the specific case of the EDPS, the Court\nparticularly notes the following points:
\nPURPOSE: presentation of the report of the Court of\nAuditors on the implementation of the 2010 EU Budget (Section I\n– European Parliament.
\nCONTENT: the European Court of Auditors (ECA)\npublished its 34th annual report on the implementation\nof the 2010 EU General Budget.
\nIn accordance with the tasks and objectives assigned\nto it by the Treaty on the Functioning of the EU (TFEU), in the\ncontext of the discharge procedure, the Court of Auditors provides,\nboth for the European Parliament and the Council, a statement of\nassurance (“DAS”) on the reliability of the accounts, as\nwell as the legality and regularity of transactions of each EU\ninstitution, body or agency, on the basis of an independent\nexternal audit.
\nThis audit also dealt with the European\nParliament’s financial implementation.
\nOn the basis of these audits, the Court considers that\nthe payments in the policy group “Administrative and other\nexpenditure” were free from material error. The estimated\nrate of error is 0.4%.
\nThe ECA found that supervisory and control systems for\nadministrative and other expenditure were effective in ensuring the\nregularity of payments. However, the ECA found a number of\nerrors and weaknesses in the implementation of procurement\nprocedures by the EU institutions and bodies. Recruitment\ndecisions were also not always appropriately documented. These\nweaknesses were not material for the policy group as a whole, but\nwere significant in the context of the individual institution or\nbody concerned and need to be addressed by their\nadministrations.
\nThe ECA recommends the EU institutions and bodies\nshould ensure that:
\nThe Court also makes a number of observations in\nregard to each EU institution or body and do not call into question\nthe overall positive assessments given that they do not have a\nsignificant effect on the overall administrative expenditures\nundertaken.
\nIn the specific case of the audit of the European\nParliament, the ECA notes the following points:
\nFollow-up on the observations in the ECA’s 2009\nannual report: in regard to the\npayment of social allowances to staff members, the Court\nindicated that staff should be requested to deliver at appropriate\nintervals documents confirming their personal situation. In\naddition, the Parliament should implement a system for the timely\nmonitoring and control of these documents. Parliament indicated in\nresponse that it had implemented measures to mitigate the risk:\nlaunching of a campaign to check eligibility for some allowances,\nwhich led to the recovery of more than 70 000 euro;
\n