12 Amendments of Luke Ming FLANAGAN related to 2022/2020(INI)
Amendment 1 #
Motion for a resolution
Recital B
Recital B
B. whereas Article 1277 of the Financial Regulation defines the concept of ‘cross-reliance on audits’ for all interventions financed by EU funds; highlights that this article sets out a basis for auditors to rely on previous audit work when this has been conducted in compliance with the EU rules, applicable international standards and by an independent auditor; without prejudice to existing possibilities for carrying out further audits; underlines, that the Single Audit principle aims to prevent a duplication of audit work, reducing the overall costs of audit activities and decreasing the administrative burden on auditees; but reminds that in shared management the Commission should rely on the audit work provided by Member States’ auditors only if their audit work is reliable and robust; _________________ 7 Article 127: ‘Cross-reliance on audits. Without prejudice to existing possibilities for carrying out further audits, where an audit based on internationally accepted audit standards providing reasonable assurance has been conducted by an independent auditor on the financial statements and reports setting out the use of a Union contribution, that audit shall form the basis of the overall assurance, as further specified, where appropriate, in sector-specific rules, provided that there is sufficient evidence of the independence and competence of the auditor. To that end, the report of the independent auditor and the related audit documentation shall be made available on request to the European Parliament, the Commission, the Court of Auditors and the audit authorities of Member States’.
Amendment 10 #
Motion for a resolution
Paragraph 3
Paragraph 3
3. Recalls the observations of the discharge authority as regards the implementation of the Recovery and Resilience Facility and the involvement of regional and local authorities and other stakeholders who were not sufficiently involved in the setting-up of national programmes; reminds that in certain cases these situations stem from the constitutional set-up of the Member States, but reminds the importance of a grassroots involvement of local partners in the setting up of all programmes;
Amendment 12 #
Motion for a resolution
Paragraph 4
Paragraph 4
4. Points out that errors and irregularities should be detected and corrected by the managing authorities and paying agencies in the first instance; recalls that the European Court of Auditors (ECA) found that in the implementation of the cohesion policy9 , managing authorities’ verifications are still partly ineffective in preventing or detecting irregularities in the expenditure declared by beneficiaries; _________________ 9 Annual report on the implementation of the EU budget for the 2021 financial year, p. 160.
Amendment 16 #
Motion for a resolution
Paragraph 5
Paragraph 5
5. Insists that the audit bodies in Member States have to comply with internationally accepted standards on audits; states that failing to comply with them might undermine the reliability and quality of the audit work and thus pose a threat to the Single Audit approach; notes, in this regard, that the ECA hasrepeatedly identified shortcomings in the scope, quality, documentation and reporting of certain national audit authorities’ work10 ; considers that the weaknesses found in the work of several audit authorities covered by the ECA’s sample currently limit the reliance that can be placed on that work; stresses the importance for Member States to have a basic framework with clear and detailed responsibilities for ensuring the quality of audits, in order to avoid misinterpretation of EU rules; insists that if the audit authorities are working in an effective, independent and transparent way and deploying international standards, double audits should be avoided to reduce the bureaucratic burden and to make efficient use of audit capacities; _________________ 10 Annual report on the implementation of the EU budget for the 2021 financial year, pp. 163-168.
Amendment 20 #
Motion for a resolution
Paragraph 7
Paragraph 7
7. Underlines that independent audit bodies and other bodies managing funds in Member States are a key requirement for the reliability and quality of the audit results; recalls with concern that in some Member States, state bodies with supervisory functions have seen arbitrary appointments leading to questions with regard to their impartiality in detecting and reporting corruption; highlights that deficient independent oversight mechanisms and illegal interconnections between political and oligarchical structures in the economic and societal spheres are conducive to corruption12 ; _________________ 12 https://commission.europa.eu/system/files/ 2022- 07/40_1_193993_coun_chap_hungary_en. pdf.
Amendment 21 #
Motion for a resolution
Paragraph 7 a (new)
Paragraph 7 a (new)
7a. Underlines that concerns over the transparency and independence of the audit bodies are not acceptable and that Single Audit approach can only be applied when all of these factors are in place: clear separation of powers between programme competent authorities; no pressure whisper is made possible; complete and unlimited oversight of the audit work;
Amendment 23 #
Motion for a resolution
Paragraph 8
Paragraph 8
8. Reiterates its concern regarding the difference between the ECA’s and the Commission’s method for calculating errors, which creates confusion and reduces the sense of urgency needed to tackle the root causes of errors; highlights that these divergences do not occur in all areas of expenditure; but was particularly evident in 2021 financial year for the heading 1 “Single Market” where the Commission risk at payment was below the ECA’s range for error but also in heading 2 covering Cohesion where the Commission’s estimate is in the lower half of ECA’s range; reminds that ECA has reported in ex posts checks affecting risk at payments and in particular these weakness concerned ex post audits by the Commission’s Common Audit Service (in “Single Market”) and checks by Members States’ audit Authorities (for “Cohesion”)13a Annual report on the implementation of the EU budget for the 2021 financial year, p. 41 emphasises that adequate audit coverage is needed for a statistical representative sample that reflects the high degree of confidence needed for audit work to lead to reliable conclusions; calls on the Commission to improve its methodology and cooperate with the ECA with a view to increasing harmonisation in order to provide more comparable figures and to continue with areinforce the risk- based approach ifto make sure that in case severe deficiencies appear in certain Member States or sectors; reliability of controls can be ensured; _________________ 13a Annual report on the implementation of the EU budget for the 2021 financial year, p. 41
Amendment 29 #
Motion for a resolution
Paragraph 9 a (new)
Paragraph 9 a (new)
9a. Invites the Commission to encourage the exchange of best practices among Member States in term of implementing and auditing methodologies
Amendment 34 #
Motion for a resolution
Paragraph 12
Paragraph 12
12. Calls on the Commission to enhance cooperation with the Member States, in particular, on avoiding mistranslation issues that may hinder the uniform interpretation of EU law as well as impose a further administrative burden on national authorities when interpreting and applying the relevant provisions, so that they are not compelled to resort to versions existing in other official languages13 ; stresses that the Commission should ensure a horizontal application of audit standards in all Member States in order to avoid different levels of scrutiny and application; suggests that the Commission should develop a light audit methodology for authorities that consistently perform well and follow all Commission recommendationsto reinforce its control system in particular for Member States and sectors where deficiencies appear; considers necessary that a stronger control and audit system is put in place in these situations without reducing the attention on Member States or sectors that perform well; _________________ 13 Judgement of the General Court of 12 March 2019, Italy v Commission, T‑135/15, ECLI:EU:T:2019:155.
Amendment 39 #
Motion for a resolution
Paragraph 13
Paragraph 13
13. Calls on the Commission and the Member States, when implementing EU programmes, always to take account of the needs and experience of the regional and local authorities and communities that are involved in the implementation of the funds, both as regards their administrative capacity and the suitability of the operational and audit procedures that they have to implement;
Amendment 43 #
Motion for a resolution
Paragraph 14 a (new)
Paragraph 14 a (new)
14a. As for CAP invites the Commission to reduce administrative burden for farmer which is often the reason for unintentional mistakes which should be clearly separated from deliberate frauds, hence ensuring the more efficient deployment of CAP funds; recommeds that the audit reports continue to give a clear breakdown of error rates for each pillar of the CAP, identifying areas in which simplification is most needed; insists that a marginally higher error rate for agri-environmental measures should not discourage the Member States from making them available to farmers in rural communities;
Amendment 45 #
Motion for a resolution
Paragraph 14 b (new)
Paragraph 14 b (new)
14b. supports the use of simplified cost options to allow authorities reduce complexity and ensuring that farmers are not left out of pocket concerning payments compensating ‘additional costs incurred and income foregone’, for example in regard to Natura 2000, groundwater protection zones under the Water Framework Directive , or other second-pillar payments linked to statutory obligations; notes that ensuring high, or at least remunerative, payments for public goods provided by the protection of such areas will, if applied correctly by the Member States and the Commission, go a long way to easing tensions and diminishing the resentment among some farmers in relation to protection obligations;