REPORT on discharge in respect of the implementation of the budget of the European Centre for the Development of Vocational Training for the financial year 2015

31.3.2017 - (2016/2161(DEC))

Committee on Budgetary Control
Rapporteur: Inés Ayala Sender

Procedure : 2016/2161(DEC)

Document stages in plenary

Document selected :

A8-0145/2017

Texts tabled :

A8-0145/2017

Debates :

PV 26/04/2017 - 19
CRE 26/04/2017 - 19

Votes :

PV 27/04/2017 - 5.28

Texts adopted :

P8_TA(2017)0159

1. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

1. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

on discharge in respect of the implementation of the budget of the European Centre for the Development of Vocational Training for the financial year 2015

(2016/2161(DEC))

The European Parliament,

– having regard to the final annual accounts of the European Centre for the Development of Vocational Training for the financial year 2015,

– having regard to the Court of Auditors’ report on the annual accounts of the European Centre for the Development of Vocational Training for the financial year 2015, together with the Centre’s reply[1],

– having regard to the statement of assurance[2] as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors for the financial year 2015, pursuant to Article 287 of the Treaty on the Functioning of the European Union,

– having regard to the Council’s recommendation of 21 February 2017 on discharge to be given to the Centre in respect of the implementation of the budget for the financial year 2015 (05873/2017 – C8‑0048/2017),

– having regard to Article 319 of the Treaty on the Functioning of the European Union,

– having regard to Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council of 25 October 2012 on the financial rules applicable to the general budget of the Union and repealing Council Regulation (EC, Euratom) No 1605/2002[3], and in particular Article 208 thereof,

– having regard to Regulation (EEC) No 337/75 of the Council of 10 February 1975 establishing a European Centre for the Development of Vocational Training[4], and in particular Article 12a thereof,

– having regard to Commission Delegated Regulation (EU) No 1271/2013 of 30 September 2013 on the framework financial regulation for the bodies referred to in Article 208 of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council[5], and in particular Article 108 thereof,

– having regard to Rule 94 of and Annex IV to its Rules of Procedure,

– having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Employment and Social Affairs (A8-0145/2017),

1. Grants the Director of the European Centre for the Development of Vocational Training discharge in respect of the implementation of the Centre’s budget for the financial year 2015;

2. Sets out its observations in the resolution below;

3. Instructs its President to forward this decision, and the resolution forming an integral part of it, to the Director of the European Centre for the Development of Vocational Training, the Council, the Commission and the Court of Auditors, and to arrange for their publication in the Official Journal of the European Union (L series).

2. PROPOSAL FOR A EUROPEAN PARLIAMENT DECISION

on the closure of the accounts of the European Centre for the Development of Vocational Training for the financial year 2015

(2016/2161(DEC))

The European Parliament,

– having regard to the final annual accounts of the European Centre for the Development of Vocational Training for the financial year 2015,

– having regard to the statement of assurance[7] as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors for the financial year 2015, pursuant to Article 287 of the Treaty on the Functioning of the European Union,

– having regard to Article 319 of the Treaty on the Functioning of the European Union,

– having regard to Regulation (EEC) No 337/75 of the Council of 10 February 1975 establishing a European Centre for the Development of Vocational Training[9], and in particular Article 12a thereof,

– having regard to Rule 94 of and Annex IV to its Rules of Procedure,

– having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Employment and Social Affairs (A8-0145/2017),

1. Approves the closure of the accounts of the European Centre for the Development of Vocational Training for the financial year 2015;

2. Instructs its President to forward this decision to the Director of the European Centre for the Development of Vocational Training, the Council, the Commission and the Court of Auditors, and to arrange for its publication in the Official Journal of the European Union (L series).

3. MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

with observations forming an integral part of the decision on discharge in respect of the implementation of the budget of the European Centre for the Development of Vocational Training for the financial year 2015

(2016/2161(DEC))

The European Parliament,

– having regard to its decision on discharge in respect of the implementation of the budget of the European Centre for the Development of Vocational Training for the financial year 2015,

– having regard to Rule 94 of and Annex IV to its Rules of Procedure,

– having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Employment and Social Affairs (A8-0145/2017),

A. whereas, according to the financial statements of the European Centre for the Development of Vocational Training (the “Centre”), its final budget for the financial year 2015 was EUR 18 356 560, representing an increase of 6,27 % compared to 2014; whereas the Centre’s entire budget derives from the Union budget,

B. whereas the Court of Auditors (the “Court”) stated that it had obtained reasonable assurances that the Centre’s annual accounts for the financial year 2015 are reliable and that the underlying transactions are legal and regular,

C. whereas in the context of the discharge procedure, the discharge authority stresses the particular importance of further strengthening the democratic legitimacy of the Union institutions by improving transparency and accountability, implementing the concept of performance based budgeting and good governance of human resources,

Follow-up of 2014 discharge

1. Acknowledges the fact that:

 by the end of 2015 it had closed 11 of the 23 recommendations and related actions on how it could develop and strengthen its role, which were proposed within the scope of its periodic external evaluation and it should inform the discharge authority of the advancements made regarding the implementation of the remaining recommendations;

 the repair works to the Centre’s building were finalised in December 2015 and the Centre signed a protocol of acceptance for the use of the areas were subject to repair with the company responsible for the works and that company was asked to provide an action plan and process to monitor the state of the building for at least ten years following completion of the works;

Budget and financial management

2. Notes with satisfaction that the budget monitoring efforts during the financial year 2014 resulted in a budget implementation rate of 98,61 %, representing an increase of 3 % compared to the previous year; notes, furthermore, that the payment appropriations execution rate was at 83,04 %, representing a decrease of 3,33 % compared with the previous year;

Commitments and carry-overs

3. Notes that, according to the Court’s report on the Centre’s annual accounts for the financial year 2015 (the “Court’s report”), the level of committed appropriations carried over was at EUR 477 994 or 28 % for Title II (administrative expenditure); acknowledges the fact that those carry-overs consisted in large part of the high volume of network and other IT equipment required for the refurbishment of the repaired areas of the Centre’s building which had not yet been delivered or invoiced by the end of 2015; notes that the carry-overs may often be partly or fully justified by the multiannual nature of the Centre’ operational programmes, do not necessarily indicate weaknesses in budget planning and implementation, and are always at odds with the budgetary principle of annularity, in particular if they are planned in advance by the Centre and communicated to the Court;

4. Notes that the Centre was able to use additional savings resulting from the downward adjustment in the salary weighting factor from 83,8 % in 2014 to 79,9 %; notes, furthermore, that this adjustment was only communicated to the Centre in November 2015; acknowledges the fact that although the Centre was able to use of the funds immediately before the year-end, the disbursement could be made only in 2016;

Transfer

5. Notes from the Centre’s annual activity report that it made 57 transfers in 2015, totalling EUR 586 100 from Title I (staff expenditure) to Title II (administrative expenditure) and Title III (operating expenditure) in order to maximise efficiency of use of available funds; notes with satisfaction that the level and nature of transfers in 2015 remained within the limits of the financial rules;

Procurement and recruitment procedures

6. Notes that the Centre undertook 70 procurement procedures in 2015, representing an increase of 32 % compared with 2014, of which 21 % were open procedures and 79 % were negotiated procedures;

7. Appreciates the fact that the Centre remained actively committed to equal opportunities in recruitment and employment, with 61 % female and 39 % male staff and that it also aims to ensure geographical balance; welcomes the fact that women are well represented at all grades including at management level;

8. Notes that there was a downwards salary adjustment at the end of 2015; calls on the Centre to ensure that this does not lead to a negative impact on the living and working conditions of staff members and the Centre's ability to make its positions competitive and attractive;

Prevention and management of conflicts of interests and transparency

9. Acknowledges the fact that, as a standard procedure, the Centre’s director requested newly appointed governing board members to sign a declaration of conflicts of interests in compliance with the Centre’s policy on the prevention and management of conflicts of interests adopted in October 2014; notes, moreover, that the Centre regularly reminded and encouraged the few members of the governing board which have not yet submitted a declaration of absence of conflict of interest to do so; urges those remaining members to submit signed declarations without further delay; calls on the Centre to publish these documents on their website as to allow the public the necessary overview on the Centre's senior management;

10. Recalls that the Centre adopted an anti-fraud strategy on 22 October 2014, along with its policy on prevention and management of conflicts of interests; acknowledges that the Centre provides to its staff regular awareness-raising activities on ethics, integrity and internal control issues, including an overview on the Centre’s anti-fraud strategy, the principles of the prevention and management of conflicts of interests, the guidelines on reporting irregularities (whistleblowing) and the “red flags” related to procurement procedures;

Internal controls

11. Notes that the Centre performs a regular risk assessment and prepares a risk management plan which is part of its annual work programme in order to identify the risks which could affect the achievement of the Centre’s objectives; observes that the Centre evaluates risks based on their potential impact on the organisation and likelihood that risks will materialise; notes with satisfaction from its 2015 work programme that the Centre’s management controlled the risks at activity and project level, with risk levels below the benchmark;

12. Understands that the Centre’s management identified one generic risk above the benchmark concerning the issue of unforeseen (external) demands from stakeholders; notes that such demands from stakeholders, including the Union’s institutions, may be difficult to meet with the Centre’s available resources; notes that the Centre regularly informs its governing board members about the changes in its work programme and of the fact that the close monitoring of developments allows the Centre to anticipate demands and integrate such activities appropriately or adjust the annual work programme in line with available resources and such demands;

Internal audit

13. Acknowledges the fact that the Commission’s internal audit service (IAS) carried out an audit on “procurement, including fraud prevention and legal advice”, as part of the agreed IAS Strategic audit plan 2013 to 2015; observes that the final audit report contained five recommendations of which one was marked as “very important” and four as “important”; notes, moreover, that the Centre prepared an action plan to address all the recommendations, which was to be implemented by the end of 2016; calls on the Centre to report to the discharge authority on the results of the implementation of the action plan;

Performance

14. Notes that the Centre cooperates closely with the European Training Foundation (ETF) and the European Foundation for the Improvement of Living and Working Conditions (Eurofound) and that that cooperation is formalised in cooperation agreements between those agencies as well as in previously agreed annual work programmes;

15. Acknowledges the fact that the Centre actively contributed to a number of Union agencies’ performance development network activities, such as the working group on “activity-based budgeting, costing and management”, cooperating with other Union agencies to collect good practices and developing a toolkit for activity-based management in the Union agencies;

16. Notes that the Centre’s performance measurement system (PMS) is an integral part of its planning and reporting processes; notes that the PMS provides understanding of the Centre’s achievements, relevance and efficient and promotes a culture of continuous improvement among its staff; notes with satisfaction that the internal review of the PMS system conducted in 2015 confirmed that the PMS provides a clear analytical tool to understand the Centre’s performance focusing on the outcomes of the its work;

Other comments

17. Notes from the Court’s report that the building provided to the Centre by the Greek authorities is constructed on an active fault line, which resulted in structural damage to the building; acknowledges the fact that the repair works on the building were finalised in December 2015; notes that the Centre signed a protocol of acceptance for the use of the areas subject to repair and that the company responsible for works was asked to provide an action plan and process to monitor the state of the building for at least ten years following completion of the works;

18. Notes that the Centre is addressing various safety issues related to the construction of the building; notes in particular a safety issue concerning the building’s glass façade and the skylights of the Centre’s conference rooms, which is affecting the availability of the Centre’s facilities; calls on the Centre and the Commission to prepare a risk-assessment paper to serve as a basis for future decisions to be taken as to possible repairs to the construction or eventual decisions on reallocation to another building;

19. Notes that the repair works and structural strengthening were completed in 2015; notes with satisfaction that the recent crack meter readings conducted in April 2016 demonstrated the repair works as effective; welcomes the installation of all necessary systems to monitor stability and rate of sliding, as well as putting in place a sliding insurance for the building, which comprehensively addressed the structural damage;

20. Observes that the Centre still experiences various safety issues related to the building’s glass façade and the skylights of the Centre’s conference rooms, which exhibit specific accelerated wear-and-tear; notes that the works aimed at completely resolving those issues were completed in November 2016; notes also that because repairs to the windows were critical, the works were financed from the Centre’s budget and the Centre is now actively following up the issue of financial liability with the Greek authorities; calls on the Centre to report to the discharge authority about the completion and effectiveness of the works, as well as the issue of financial liability; further calls on the Centre to assess whether the recurring problems with the current building call into question not only its economic viability, but more importantly the safety and security of its personnel and whether relocation to a new building would be a more preferable solution;

21. Appreciates the good quality of the Centre’s research, analyses and technical advice through which it supports the development of European lifelong learning and VET policies and contributes to their implementation in order to enable workers to acquire good skills and to contribute to achieving the goals set in the Europe 2020 strategy;

22. Welcomes the Centre’s focus on competences and skills which among other objectives helps to better match vocational training to labour market demands and particularly welcomes the first European Skills and Jobs Survey as well as the launch of the new Skills Panorama; welcomes the fact that the Centre provided more country-specific information and analysis and expanded its support to individual Member States through expertise provided in connection with policy implementation;

23. Acknowledges that the policy framework guiding the Centre’s work has evolved in 2015 so as to include a new set of priorities for the period 2015 to 2020 as endorsed by Ministers responsible for VET policies in the Riga conclusions;

24. Notes that the Centre introduced a new internal structure at the beginning of 2015 and that 2015 was the Centre's first full year under the remit of the Commission's Directorate General for Employment, Social Affairs and Inclusion;

° °

25. Refers, for other observations of a cross-cutting nature accompanying its decision on discharge, to its resolution of [xx xxxx 2017][11] [on the performance, financial management and control of the agencies].).

1.2.2017

OPINION of the Committee on Employment and Social Affairs

for the Committee on Budgetary Control

on discharge in respect of the implementation of the budget of the European Centre for the Development of Vocational Training for the financial year 2015

(2016/2161(DEC))

Rapporteur: Marian Harkin

SUGGESTIONS

The Committee on Employment and Social Affairs calls on the Committee on Budgetary Control, as the committee responsible, to incorporate the following suggestions into its motion for a resolution:

1. Expresses its satisfaction that the Court of Auditors has declared the transactions underlying the Centre’s annual accounts for the financial year 2015 to be legal and regular and that its financial position as at 31 December 2015 is fairly represented;

2. Appreciates the good quality of the Centre’s research, analyses and technical advice through which it supports the development of European lifelong learning and VET policies and contributes to their implementation in order to enable workers to acquire good skills and to contribute to achieving the goals set in the Europe 2020 strategy;

3. Commends the high budget implementation rate in 2015 (98,55 %) and good overall target delivery; notes, however, that the level of appropriations carried over was high for title II (28 %); notes that this resulted from a large amount of equipment required following refurbishment of the Centre’s building which had not been delivered or invoiced by the end of 2015;

4. Welcomes the Centre’s focus on competences and skills which among other objectives helps to better match vocational training to labour market demands and particularly welcomes the first European Skills and Jobs Survey as well as the launch of the new Skills Panorama; welcomes that the Centre provided more country-specific information and analysis and expanded its support to individual Member States through expertise provided in connection with policy implementation;

5. Notes the need for a clearer orientation and direction of the Centre, to further develop personnel management system and to closely link activities to indicators in order to improve the overall performance of the agency;

6. Acknowledges that the policy framework guiding the Centre’s work has evolved in 2015 so as to include a new set of priorities for the period 2015 to 2020 as endorsed by Ministers responsible for VET policies in the Riga Conclusions;

7. Notes that there was a downwards salary adjustment at the end of 2015; calls on the Centre to ensure that this does not lead to a negative impact on the living and working conditions of staff members and the Centre's ability to make its positions competitive and attractive;

8. Notes that the Centre introduced a new internal structure in the beginning of 2015 and that 2015 was the Centre's first full year under the remit of the European Commission's Directorate General for Employment, Social Affairs, and Inclusion;

9. Welcomes the Centre’s follow-up measures in relation to the comments of the discharge authority made regarding the implementation of the budget of previous years; notes that in 2015, all internal and external works on the Centre’s building to repair and strengthen its structure on account of its location on an active fault line were completed, and that building safety issues continue to be addressed and should be resolved in 2016; calls on the Centre to continue to keep Parliament updated on these safety issues.

RESULT OF FINAL VOTE IN COMMITTEE ASKED FOR OPINION

Date adopted	25.1.2017
Result of final vote	+: –: 0:	45 3 2
Members present for the final vote	Laura Agea, Brando Benifei, Vilija Blinkevičiūtė, Enrique Calvet Chambon, Ole Christensen, Lampros Fountoulis, Arne Gericke, Marian Harkin, Czesław Hoc, Agnes Jongerius, Rina Ronja Kari, Jan Keller, Agnieszka Kozłowska-Rajewicz, Jean Lambert, Jérôme Lavrilleux, Patrick Le Hyaric, Jeroen Lenaers, Verónica Lope Fontagné, Javi López, Thomas Mann, Dominique Martin, Joëlle Mélin, Elisabeth Morin-Chartier, João Pimenta Lopes, Georgi Pirinski, Terry Reintke, Sofia Ribeiro, Robert Rochefort, Claude Rolin, Anne Sander, Sven Schulze, Siôn Simon, Jutta Steinruck, Romana Tomc, Yana Toom, Ulrike Trebesius, Marita Ulvskog, Renate Weber, Jana Žitňanská
Substitutes present for the final vote	Georges Bach, Heinz K. Becker, Lynn Boylan, Dieter-Lebrecht Koch, Paloma López Bermejo, Edouard Martin, Evelyn Regner, Csaba Sógor, Helga Stevens, Flavio Zanonato
Substitutes under Rule 200(2) present for the final vote	Marco Valli

INFORMATION ON ADOPTION IN COMMITTEE RESPONSIBLE

Date adopted	22.3.2017
Result of final vote	+: –: 0:	21 4 0
Members present for the final vote	Inés Ayala Sender, Dennis de Jong, Tamás Deutsch, Martina Dlabajová, Luke Ming Flanagan, Ingeborg Gräßle, Cătălin Sorin Ivan, Jean-François Jalkh, Bogusław Liberadzki, Monica Macovei, Notis Marias, José Ignacio Salafranca Sánchez-Neyra, Petri Sarvamaa, Claudia Schmidt, Bart Staes, Hannu Takkula, Derek Vaughan, Joachim Zeller
Substitutes present for the final vote	Richard Ashworth, Gerben-Jan Gerbrandy, Benedek Jávor, Karin Kadenbach, Patricija Šulin
Substitutes under Rule 200(2) present for the final vote	Jens Geier, Piernicola Pedicini

FINAL VOTE BY ROLL CALL IN COMMITTEE RESPONSIBLE

ALDE

ECR

GUE/NGL

PPE

S&D

VERTS/ALE

Martina Dlabajová, Gerben-Jan Gerbrandy, Hannu Takkula

Monica Macovei

Luke Ming Flanagan, Dennis de Jong

Tamás Deutsch, Ingeborg Gräßle, José Ignacio Salafranca Sánchez-Neyra, Petri Sarvamaa, Claudia Schmidt, Joachim Zeller, Patricija Šulin

Inés Ayala Sender, Jens Geier, Cătălin Sorin Ivan, Karin Kadenbach, Bogusław Liberadzki, Derek Vaughan

Benedek Jávor, Bart Staes

ECR

EFDD

ENF

Richard Ashworth, Notis Marias

Piernicola Pedicini

Jean-François Jalkh

0	0

Key to symbols:

+ : in favour

- : against

0 : abstention

[1] OJ C 449, 1.12.2016, p. 32.
[2] OJ C 449, 1.12.2016, p. 32.
[3] OJ L 298, 26.10.2012, p. 1.
[4] OJ L 39, 13.2.1975, p. 1.
[5] OJ L 328, 7.12.2013, p. 42.
[6] OJ C 449, 1.12.2016, p. 32.
[7] OJ C 449, 1.12.2016, p. 32.
[8] OJ L 298, 26.10.2012, p. 1.
[9] OJ L 39, 13.2.1975, p. 1.
[10] OJ L 328, 7.12.2013, p. 42.
[11] Texts adopted of that date, P[8_TA(-PROV)(2017)0000].

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