EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

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EUU Alm.del Bilag 112
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OURNAL

European Court of Auditors

November 2017

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

PRODUCTION

Rédacteur en chef / Editor in Chief:

Gaston Moonen

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00352 4398 - 45716

E-mail :

[email protected]

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Directorate of the Presidency

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Past editions of the Journal

can be found on ECA’s website:

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Journal.aspx

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acknowledged

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and the articles are the sole

responsibility of the interviewees

and authors and do not

necessarily relect the opinion of

the European Court of Auditors

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EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

TABLE OF CONTENTS

Editorial

The European Court of Auditors: catalyst for good management

and transparency

Looking back at the oicial anniversary ceremony

By Gaston Moonen, Directorate of the Presidency

Banque Central du Luxembourg issued a 40 euro cents collector coin to celebrate

the ECA anniversary

By Werner Vlasselaer, Private Oice of Jan Gregor, ECA Member

Exhibition '40 years in pictures the European Court of Auditors 1977 - 2017'

By Gilberto Moggia, Directorate Information, Workplace and Innovation

Wallpaper posters ‘ECA Then and Now’

By Gaston Moonen, Directorate of the Presidency

Can SAIs contribute to restoring the trust of EU citizens?

By Radek Majer, Directorate of the Presidency

Restoring trust of citizens: a topic SAIs clearly need to be engaged with

Interview with Brigitte Christ, Vice President (Stellvertretende Direktorin) of the

Swiss Federal Audit Oice

By Gaston Moonen, Directorate of the Presidency

Stakeholders discussing challenges ahead

ECA conference on the Landscape Review EU Action on energy and Climate change

By Olivier Prigent, Directorate Sustainable use of natural resources, and Katharina Bryan,

Private Oice of Phil Wynn Owen, ECA Member

Follow-up of audit recommendations: the ECA experience

By Nikolaos Milionis, ECA Member

Future EU budget decision-making enters the crucial stage

By Mihails Kozlovs, ECA Member

REACHING OUT

Commission Vice-President Jyrki Katainen visits the ECA

By Turo Hentilä, Private Oice of Ville Itäla, ECA Member

Geert Bourgeois, Minister President of Flanders, visits the ECA

By Gerry Madden, Private Oice of Karel Pinxten, ECA Member

Representatives of the Managing Authority for the cross-border programme

IPA ADRIATIC visit the ECA

By Chiara Cipriani and Benjamin Jakob, Private Oice of Pietro Russo, ECA Member

Representatives of the Czech Ministry of Finance visit the ECA

By Werner Vlasselaer, Private Oice of Jan Gregor, ECA Member

FOCUS

Publications in the previous month

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

The 40th anniversary of the ECA - a ‘feel good’

experience that matters

When you celebrate your anniversary, the chances are high that you feel

good - and that your guests are positive about what you have done for them,

or perhaps even to them, over the years. During the oicial ceremony to

mark the ECA’s 40th anniversary, there was clearly such a ‘feel good factor’

among many of the participants, both hosts and guests. We had assembled

quite a crowd in Luxembourg, including the head of state and the prime

minister of our host country, the highest representatives from the European

Parliament, the Council and the Commission and many presidents of EU

Supreme Audit Institutions (here for the EU Contact Committee meeting

which took place during the same week). It was also a home-coming, since

over 50 of the 99 Members the ECA has had since 1977 were present,

leading to some warm encounters between them and current staf.

What also felt nice were the kind words spoken about the ECA’s positive

contribution to the European project by all the guest speakers. But past

performance raises expectations for the future and this was clearly expressed

by some of those who spoke: the ECA has a role to play in a democratic and

transparent Europe, the more so in an EU where its citizens require clear

performance and added value from EU actions and funds. So there was no

time, after the praise, for big-headedness. On the contrary, if the ECA wants

to be a “catalyst for the future”, as President Kaljulaid of Estonia suggested,

then we will need to be ‘forward-looking, bold and not apologetic in our

actions,’ as set out by ECA President Klaus-Heiner Lehne.

Sharing the activities undertaken to mark our 40th anniversary is the central

theme of this Journal. At the same time we look forward, with articles on

the impact of audit recommendations, upcoming decisions on the future of

the EU budget and the ECA conference organised in Brussels on our latest

Landscape Review.

There was another personal ‘feel good factor’ for me, as an ECA staf member.

During the reception after the ceremony, there was a clear feeling of pride

among staf to be part of the world called ECA. Or, as one colleague put:

‘Really nice to see that we get such speakers together here in Luxembourg

to talk about our role in the past and for the future. It gives me the feeling

that our work truly matters and it is very stimulating.’ For me, this is the

big plus of the way we marked our anniversary. In addition to the oicial

ceremony there was (and still is) an exhibition on the ECA’s history, a special

publication looking at 40 years of public audit and the ECA anniversary Euro

coin issued by the Banque Central du Luxembourg. It is important for us

to feel good about belonging to an institution that matters. Let us hope

this continues to be an important driver for staf and that EU citizens can

continue to count on us in the future.

Gaston Moonen

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

The European Court of Auditors:

catalyst for good management

and transparency

Looking back at the oicial anniversary ceremony

By Gaston Moonen, Directorate of the Presidency Innovation

During the oicial ceremony to mark the ECA’s 40 years of activities the speakers focused on what

the ECA has achieved till now and particularly on what Europe needs for the upcoming years. And

how the ECA can contribute to a Europe that citizens can believe in to improve their lives. Below an

overview and details of the speeches given.

From left to right: Henri Grethen, ECA Member; Xavier Bettel, Prime Minister of Luxembourg; Kersti Kaljulaid, President of Estonia;

Klaus-Heiner Lehne, ECA President; their Royal Highnesses, the Grand Duchess and Duke of Luxembourg; Antonio Tajani, President of

the European Parliament; Jean-Claude Juncker, President of the European Commission; Karel Pinxten, ECA Member

High level guests and speakers to celebrate 40 years of ECA

The ECA 40

anniversary was highlighted during an oicial ceremony organised in Luxembourg

on 12 October 2017. The ceremony was attended by their Royal Highnesses the Grand Duke and

Grand Duchess of Luxembourg, authorities of the Luxembourg government, representatives of

EU institutions and Member States’ permanent representations, ambassadors, former Members,

heads of supreme audit institutions (SAIs) of EU member States and Candidates and many ECA

staf members.

The ceremony was opened by ECA President Klaus-Heiner Lehne, followed by speeches of Kersti

Kaljulaid, currently President of Estonia – the country holding the EU presidency – and before that

ECA Member, Antonio Tajani, president of the European Parliament, and Jean-Claude Juncker,

President of the European Commission. All speakers highlighted, from diferent perspectives, the

situation of Europe now, diferent historical elements related to the creation and/or work of the

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ECA as a catalyst for good management, added value and transparency

continued

ECA, how the ECA has contributed to improving inancial management in the EU, including

performance aspects, and challenges and aspirations the ECA faces for the future and how

it can continue to be relevant for the EU and its citizens. The full text of the speech of Klaus-

Heiner Lehne and highlights of the speeches of the three other speakers are presented

below with hyperlinks to the full text of the speeches.

ECA 40th anniversary ceremony at the Hemicycle of

Luxembourg Congrès

Intermezzo’s in the programma were presented by the musical ensemble ‘The Ni Ensemble’,

with ive members playing trumpets, the horn, the trombone and the tuba, covering pieces

like the Wilhelmus, anthem of the grand ducal house, and master pieces written by Ludwig

van Beethoven, Antonio Vivaldi, Kerry Turner and Enrique Crespo. The ceremony was

concluded with a reception with ample opportunities for informal exchanges. At the end of

the evening all participants were ofered the special publication ‘European

Court of Auditors:

1977-2017 – 40 years of public auditing,

’ which looks back at the history of the ECA through

various archive documents and testimonies.

Special publication

‘European Court of Auditors:

1977-2017 – 40 years of public auditing,’

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

ECA as a catalyst for good management, added value and transparency

continued

Speech by Klaus-Heiner Lehne, President of the European Court of Auditors,

on the occasion of the special event marking the ECA’s 40th anniversary,

Luxembourg, 12 October 2017

Klaus-Heiner Lehne,

ECA President at the Hemicycle of

Luxembourg Congrès

Royal Highnesses, Excellencies, Ladies and gentlemen, dear colleagues, dear friends,

It is a great pleasure to welcome you all here to Luxembourg on the occasion of the European

Court of Auditors’ 40th anniversary. And I am particularly pleased to personally welcome:

•

their Royal Highnesses, the Duke and Grand Duchess of Luxembourg and the Prime

Minister of Luxembourg, Xavier Bettel, along with other high-ranking Luxembourg

representatives;

•

the President of the European Parliament, Antonio Tajani, together with our key

interlocutor in the Parliament, Inge Gräßle, the Chair of the Budgetary Control

committee, and other representatives of the Parliament;

•

our former colleague, the President of Estonia, Kersti Kaljulaid;

•

the President of the European Commission, Jean-Claude Juncker, and Commissioner

Oettinger.

Last but not least, I would like to welcome my predecessors, the former Presidents of the

European Court of Auditors, Vitor Caldeira, Hubert Weber and André Middelhoek.

Public auditing and inancial accountability are deeply rooted in the broader concept of

democratic accountability.

The creation of the Court through the Treaty of Brussels in the

seventies shows this

convergence

between the requirement of independent external audit

and the goal of full democratic accountability.

We would not be here today, were it not for a determined campaign for a European Audit

Institution, in large part led by the European Parliament, in an alliance with the supreme audit

institutions in the Member States. One particularly imposing parliamentary igure stands out

from those early days, and it is Heinrich Aigner, to whom I would like to pay tribute tonight.

Forty years ago,

in October 1977, the nine founding Members of the Court, having taken

their oath of oice before the Court of Justice, arrived at rue Aldringen. They had to start their

work more or less from scratch and deal with numerous questions, ranging from audit work

to the recruitment of staf. It was only later that the Court became a formal institution as we

know it today. In the meantime, the Court of Auditors’ next meeting will be its 1072nd!

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ECA as a catalyst for good management, added value and transparency

continued

I speak for all the Members of the Court when I say that I’m honoured that you all made it

here to share this anniversary with us. This year has been a turning point for Europe. Rather

than staring into the abyss, twenty seven European leaders gathered in Rome, reairming

their common future. President Juncker, just one month ago, with Europe’s economy inally

bouncing back, you provided a roadmap for the months and years to come. It is a bold one.

We need to be forward-looking and

bold, not apologetic

in our actions.

In particular, we need to be more

conident in our values and conident in our potential.

Debating what sort of Union we want to live in is good, and even essential. But perpetual self-

doubt and even self-lagellation only add to the confusion felt by many citizens, and plays

directly into the hands of populists. It is only with a

strong sense of purpose

that the EU and

its Member States will be able to set the agenda worldwide, be it on trade, be it on climate

change, be it on confronting terrorist threats and managing migration lows.

As President of the European Court of Auditors I can assure you that we are determined to

fully play our part

in such a reinvigorated European Union. We are determined to be an

independent voice,

capable of meting out praise where things work, but also to highlight

uncomfortable truths where things are not working properly.

A former President of the European Court of Justice, Hans Kutscher, put it with an almost

British sense of understatement when he swore in our irst batch of Members in 1977: “it is

no secret that the activity of those bodies responsible for the supervision of budgets is

not

always a source of joy

for those involved”. However, he argues rightly that such control must

be “welcomed with gratitude”. As Heinrich Aigner put it perfectly: the control exercised by the

Court of Auditors should be “not

punitive but constructive”.

We are determined to ensure that every euro spent at EU level brings clear

added value.

And

with a potentially shrinking budget, this will no doubt be a challenge in

all

spending areas. We

must ensure that

all

EU spending is accountable and independently audited. I don’t think that,

in the long term, our citizens, businesses, and national authorities need additional budgets –

the Chair of the European Parliament’s Committee on Budgets has described this as a “Galaxy

of Budgets”. Rather, the citizens expect a single, lexible, transparent budget based on the

Community method.

We must also be in position to make the

right product

available

at the right time.

In the last

months we have taken decisive steps to make our Work Programme more strategic and to

modernise our Annual Report.

I want us also to better

communicate

our work in the media and to make ourselves more

understandable to citizens. Finally, we aim to

cooperate even more closely

with the

national Supreme Audit Institutions, and with the European Parliament, the Council and the

Commission.

Let me assure you that

the Court of Auditors is not an ivory tower

but an

open house:

Open to cooperate with you at all levels in keeping with our independence, open to

understand diferences and attempt to bridge them, open to learn from others and to

innovate in our daily work.

I would like to thank Presidents Kaljulaid, Juncker and Tajani for their tributes and inspiration,

and will inish with some

words of gratitude.

First, Your Royal Highness, to the Grand Duchy

of Luxembourg and its government, for providing an exceptional setting for, and support to,

our daily work, for which we are very grateful. Second, I would like to thank all our

colleagues

from Supreme Audit Institutions

in the Member States – and I’m glad to see so many of

you here -, and of course to the other

Institutions of the European Union

for the excellent

relations we have. Last but not least, I want to pay a big tribute to all current and former

Members of the ECA

and all past and present

members of staf

for their contribution to the

Court’s work. You have invested your energy here over the past four decades;

you are,

so to

speak,

the backbone

of this Institution. Thank you for your attention.

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ECA as a catalyst for good management, added value and transparency

continued

Fragments of the speech of Antonio Tajani, President of the European

Parliament, at 40th anniversary ceremony of the ECA

Full speech of Antonio Tajani

Antonio Tajani, President of the European Parliament

C’est notre engagement envers la démocratie qui fonde nos valeurs communes. La

démocratie nécessite que nous soyons responsables devant les citoyens, qui nous

rappellent chaque jour la nécessité de dépenser notre argent avec sagesse et à bon

escient. (...) C’est la Cour des comptes européenne qui garantit le bon emploi du moindre

euro dépensé pour les activités de l’Union. C’est ce que nos citoyens attendent de nous.

Il est, à mon sens, de bon augure qu’à l’occasion du quarantième anniversaire de la

Cour, vous ayez pour la toute première fois présenté une opinion avec réserve – et non

une opinion défavorable – au sujet des comptes de 2016. (...) Cette opinion avec réserve

est évidemment un signe positif pour la gestion inancière du budget de l’Union.

Elle démontre également le fruit de la volonté de contrôle constructif par la Cour des

comptes. (...) Nous voulons que vous traquiez les irrégularités sans léchir, mais aussi que

vous assistiez les autorités en les aidant à améliorer leurs pratiques et en communiquant

mieux au sujet de nos objectifs.

La Cour des comptes européenne est accoutumée à mesurer la valeur ajoutée de nos

investissements. (...) Nous devons déinir ce qui constitue une valeur ajoutée. Pour moi,

le meilleur critère de mesure de la valeur ajoutée est le fait que les citoyens constatent

que le budget européen apporte des améliorations dans leur existence, sur leur lieu de

travail, dans leur région, dans leur rue, dans leur cadre de vie.

En efet, le travail de la Cour des comptes complète celui du Parlement européen.

C’est le cas, systématiquement, dans le cadre de la procédure de décharge, en étroite

collaboration avec la commission du contrôle budgétaire du Parlement…( ).( )… la Cour

des comptes continue de rafermir sa collaboration avec le Parlement, en particulier par le

truchement de vos rapports spéciaux, qui sont du plus haut intérêt pour les commissions

parlementaires. Le Parlement européen et ses commissions apprécient grandement ces

rapports spéciaux, ... (...).

Je terminerai en remerciant tout particulièrement les membres de la Cour des comptes

européenne qui sont parmi nous aujourd’hui et tous ceux qui l’ont servie dans le passé. Je

tiens aussi à remercier tout le personnel de la Cour, qui a fait d’elle et qui fait d’elle encore ce

qu’elle est aujourd’hui: une pièce essentielle du moteur qui permet à l’Union européenne

d’accomplir sa mission au service des citoyens européens. ( ) La Cour des comptes

européenne et le Parlement européen sont deux institutions distinctes, qui sont pourtant

très proches, car elles partagent un même objectif: défendre les intérêts des citoyens de

l’Union. ( )

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ECA as a catalyst for good management, added value and transparency

continued

Fragments of the speech of Kersti Kaljulaid, President of the Republic of

Estonia, at the 40th anniversary ceremony of the ECA

Full speech of

Kersi Kaljulaid

Kersti Kaljulaid,

President of Estonia

In the name of the Estonian Council Presidency – congratulations for this important

milestone, 40th anniversary of this institution! You have been a true thorn in the executive

side of the EU and you can be truly proud of your achievements! May your teeth stay

sharp, because the European taxpayer needs you. And may your tongue remain sharp as

well, because the main tool of this institution is its leverage through public opinion.

But since 2008, when diicult adjustments in public spending in numerous Member States

made it clear to wider public that budget deicit is not something you cannot feel or taste,

quite to the contrary, it feels hairy and tastes bitter, wind has been in the sails of all public

governance bodies. The Court has used this wind well. It has learnt to report more to wider

public and less to specialists. It has developed its relations with its auditees to make sure

methodological misunderstandings will not lead to unnecessary disputes over the facts,

which could lessen the impact of its work. It uses digital environment to report and discuss

its reports with stakeholders.

While the Union has searched, understandably, to ind ways to make the ends meet when

the discussion of rising the budget ceilings has not been possible, this Court has always

stood for good governance. (...) … this Court has always been present. It has sometimes

been truly the only one which has warned – there is the day of institutional innovation,

budgetary development easier done of-balance sheet, but there will also come the day of

reckoning.

The Court has always been the smallest of the main EU institutions. (...) Its strive for

excellency has obviously been motivated by the fact that you have to practice what you

preach. I wish you the best of the future. And from a small MS currently carrying the

Presidency responsibility, I would like to end with a notice that big changes often need

a catalyst. Catalyst, as we all know from school chemistry, is a substance which starts

an important change, without needing to be present in big quantities. May ECA remain

this catalyst for good management and control of the EU budget and transparent public

environments in the whole of our union!

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ECA as a catalyst for good management, added value and transparency

continued

Fragments of the speech of Jean-Claude Juncker, President of the European

Commission, at the 40th anniversary ceremony of the ECA

Full speech of Jean-Claude Juncker

(video staring at 44 minutes)

Jean-Claude Juncker,

President of the European Commission

La Cour de Comptes vient de valider pour la dixième année consécutive les comptes

de l’Union européenne et donc de la Commission. Et pour la première fois la Cour s’est

exprimée, comment on doit le dire, sur un mode laudatif, ce qui lui arrive que très très

rarement. C’est un vrai progrès. Non pas pour le chef de la Cour, mais un vrai progrès pour

le Parlement dont je salue la Présidente de la Commission de l’exécution budgétaire. C’est

un réel succès pour l’autorité budgétaire qui n’est pas moins exigeante que la Cour et pour

la Commission parce que nous avons mieux fait que les années précédentes, parce que le

volume des erreurs dont très régulièrement nous sommes accusés par la Cour qui attire

notre attention sur nos méfaits s’est réduit.

J’aime la Cour des Comptes bien que j’en étais victime. A vrai dire depuis 1984 lorsque,

jeune ministre du budget, j’ai lu les rapports de la Cour. Il serait d’ailleurs indiqué que les

gouvernements d’aujourd’hui fassent de même. Parce que 80% des dépenses de l’Union

européenne ne sont pas des dépenses pour lesquelles la seule Commission, le seul Parlement

sont responsables. 80% du budget trouvent à travers mille méandres de cheminements vers

des Etats nationaux qui eux sont responsables pour la bonne exécution du budget.

Ich mag den Rechnungshof auch, weil die Lektüre seiner Berichte, vor allem seiner

Sonderberichte und der übrigen Stellungnamen, ist eine höchst aufschlussreiche Lektüre,

die jedem in der Politik anzuraten ist. Diese Berichte tragen mit dazu bei, dass die

Europäische Union verständlicher wird, weil, machen wir uns nichts vor,

die wenigsten Menschen in Europa verstehen, wie Europa funktioniert, und haben fast

schon vergessen, wieso Europa überhaupt existiert.

Wir werden jetzt, im März, Mai 2018 unsere Vorstellungen zur mehrjährigen Finanzplanung

(MFF) vorlegen. Und da bin ich eigentlich mit dem Präsidenten des Europäischen Parlaments

einer Aufassung, dass wir uns ein Budget an die Hand geben müssen, dass alle Ambitionen

Europas relektiert.

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Banque Central du Luxembourg issued

a 40 euro cents collector coin to celebrate

the ECA anniversary

By Werner Vlasselaer, Private Oice of Jan Gregor, ECA Member

At the occasion of the 40th anniversary of the ECA

the Banque Central du Luxembourg (BCL) issued

a collector coin for the ECA. Werner Vlasselaer ills

us in on the details related to this special coin.

Henri Grethen and Jan Gregor, ECA Members

Launching a collector coin

As an issuing authority, the BCL is in charge of the production and distribution of banknotes

and coins. In that capacity, it can, according to Regulation (EU) No 651/2012, issue

commemorative coins (maximum two per year) and collector coins.

At the initiative of Jan Gregor and Henri Grethen, ECA Members, ECA President Klaus-Heiner

Lehne suggested to the Governor of the BCL, Gaston Reinesch, to issue a coin to celebrate

the 40 years of existence of the ECA. Collector coins have the status of legal tender only in

the issuing Member State.

40 years symbolised in 40 cents

It is not the irst time that the Luxemburgish National Bank issues a collector coin for the

ECA. Some will remember that in 2007 a silver coin with a face value of 25 euro was issued to

celebrate the 30

anniversary of the ECA. This time the face value of the coin amounts to the

symbolic 40 eurocents. It is a bi-metal coin (silver and Nordic gold) carrying the ECA logo on

one side and a portrait of HRH the Grand Duke of Luxembourg on the other. The coin has a

diameter of 3,4 centimetres that weighs 15,84 grams. As only 1500 coins were produced, it is

a real collector’s item. The coins are used by ECA as an oicial gift and the ECA staf members

were given the possibility to purchase the coin.

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Exhibition '40 years in pictures

the European Court of Auditors 1977 - 2017'

By Gilberto Moggia, Directorate Information, Workplace and Innovation

For the ECA’s 40th anniversary Gilberto Moggia,

the ECA expert for knowledge management and

archives, prepared over 40 posters showing in

photographs the development of the ECA. He

introduces us to this visual walk through ECA history.

A photo exhibition to bring 40 years to life

There is nothing quite like pictures (old and new) to bring

the ECA’s 40 years to life. The very positive reactions of

ECA colleagues and visitors after visiting our posters’

exhibition

have conirmed this belief. The photographs

we have selected for the posters showcase not only the

oicial history of the ECA (Presidents and Members,

buildings, high proile visitors, institutional stakeholders

and partners) as one would expect, but also the day-

to-day working life of the hundreds of staf members

that have served our institution over the years. Last but

not least, our host country, Luxembourg, is portrayed

extensively as an essential part of our history.

The posters are displayed in the long corridor connecting

the three buildings, called K1, K2 and K3, to each other.

Coming from K3, in chronological order, one literally

walks through our common history, starting with

photographs of an almost empty Kirchberg plateau of the early seventies until the today’s futuristic skyline

of the “European Quarter”. A quite emotional journey, as one visitor told us, not without a feeling of nostalgia

for the old rural landscape.

People, places and events

People, places and events: these are the three main ingredients we have let play to mirror the great variety

and richness of 40 years of history.

André Middelhoek, former ECA Member and President,

and his wife admiring the exhibition

‘My thanks to my colleagues in my own Directorate, in logistics, translation and communication, and to colleague Alexandra-Elena

Mazilu for her excellent visual design input.’;

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Exhibition '40 years in pictures the European Court of Auditors 1977 - 2017'

continued

A selection had to be made, based on selected topics, having considered the quality of

pictures.

To cover the main aspects of our institutional life, the photographs have been

regrouped under the following categories:

•

setting up the Court

the Kirchberg area (where the ECA premises are located) over the years

the ECA and the other Institutions

our buildings

visiting the ECA

ECA staf

day-to-day work at the ECA

ECA auditors at work

ECA present and future

The posters currently displayed at the ECA can also be visited virtually through:

40th Anniversary Facebook gallery

Sources

The pictures, preserved in the ECA’s institutional archives, come from the following

collections:

•

EC audiovisual services

ECA audiovisual gallery

EP audiovisual services

Photothèque de la Ville de Luxembourg

ECA staf visiting the exhibition:

'40 years in pictures

the European Court of Auditors 1977 - 2017'

A call for “historic” photos

During the preparatory work for the exhibition, an impressive amount of material turned out to

be available in the ECA archives, especially for the most recent years when the use of cameras

has become very common. On the other hand, for the early 20 years of our history (1977-1997),

only very few photographs could be found in our archives to witness of the day-to-day work at

the ECA. May we ask, on this point, former Members, retired colleagues and partners to contact

the ECA archives ([email protected] ), should you have photographs of events,

people, buildings, etc. related to the ECA activities, to make them available for our archives? We

archivists would really appreciate if somebody could help us illing this gap.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Wallpaper posters ‘ECA Then and Now’

Looking back at 40 years of changes in audit

By Gaston Moonen, Directorate of the Presidency

Visualising an audit is not easy. And visualising developments in audit is even more

diicult. We developed posters aimed to do exactly that.

A lavour of ECA developments

At the occasion of the 40

anniversary of the ECA we have tried to visualise some of the

developments the ECA has made in relation to its audit work and how it is presented. The

idea is to give a lavour of the developments the ECA has been through in its audit ield and

environment, audit approaches, audit products and how it communicates about them. To

get an impression you will ind below a selection of the posters displayed in the K2 building

of the ECA.

We have chosen to let the primary sources speak for themselves by showing diferences

of audit-related products mostly produced in the early days of the ECA activities, i.e. the

seventies, and documents/products of recent years

The two pictures show a simpliied image of the situation between 1977 and 2017 and

make clear what the changes in the audit ield are and, related to that, which increase in

accountability challenges developed between then and now. These two pictures were made

by Jacques Sciberras, Head of Task for the landscape review ‘Gaps, overlaps and challenges: a

landscape review of EU accountability and public audit arrangements’, which was published

in 2014. I think the pictures are still as valid now as they were then.

Many thanks to Martin Weber, Gilberto Moggia and intern David Hopl for their input and to Alexandra-Elena Mazuli for her

outstanding lay-out work.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Wallpaper posters ‘ECA Then and Now’

continued

To show how the ECA products developed in presenting our indings we took one of the irst special report

of the ECA, a performance report, and compared it with a recent performance report on a similar topic.

Note the presentational changes from two column text -which then was also the Oicial Journal publication

format - with simple tables, to the current visually more attractive special report format. At the same time this

table shows also another development, the presentation of good practice material. Good practice examples

can have more impact than only presenting errors and weaknesses.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Wallpaper posters ‘ECA Then and Now’

continued

This was a relatively easy poster since the ECA went from basically no communication policy at all (at the

most reactions of Members to questions from journalists after a presentation in the EP) to an elaborated and

targeted communication policy with audit in brief documents, press releases, stakeholder meetings and of

course using social media like Facebook, Twitter and LinkedIn.

While showing staf increase is pretty straightforward we show two other developments: on the one hand

the increase in EU budget expenditure. On the other hand the changing balance in female/male staf.

This does not do full justice to other elements afecting the change in staf, like changes in audit mandate,

geographical area to be covered or new types of audit to be done or intensiied. The poster shows that staf

numbers did not increase disproportionally to the increase of the total EU budget.

ECA Statements of Assurance

With 23 Statements of Assurance (SoA) issued since 1994 it is an inluential product regarding the ECA’s

reputation and impact. But how to show the developments here? Since the phrasing is crucial in an audit

opinion we decided to show the change in wording for the two most well-known elements of the SoA, the

ECA opinion on the reliability of accounts and the ECA opinion on compliance with EU law and regulations

in the underlying expenditure transactions. For example for the latter the wording changed from

too many

errors,

valid for the statements from 1994 till 2015, to

legal and regular, except for …, which pertains to a

material level of error but no pervasive,

the inding for 2016.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Wallpaper posters ‘ECA Then and Now’

continued

With this topic we wanted to display not only the EU has grown from 9 Member States in

1977 to 28 in 2017 but also an extension of the cooperation and exchange work between

SAIs: at EU Contact Committee level, with Candidate countries, with EUROSAI members. With

INTOSAI being virtually ‘global’ we refrained from geographically displaying the increased

INTOSAI cooperation, where the ECA went from an observer to a very active member

nowadays.

You can see the whole set by clicking here:

Now and then posters pdf

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Can SAIs contribute to restoring the trust of

EU citizens?

Annual meeting of the Contact Committee of EU SAIs

in Luxembourg

By Radek Majer, Directorate of the Presidency

Coinciding with its 40th anniversary

celebration, the ECA hosted the annual

meeting of the Contact Committee

of European Union SAIs on 12 and 13

October 2017. The main discussion

addressed the possible role of SAIs

in restoring the trust of EU citizens.

Radek Majer reports on the main

issues raised, followed by fragments

of the presentations of the three key

speakers.

Brigitte Christ, SAI of Switzerland; Jean Arthuis,

MEP and Chair of the EP's Budget Committee;

Klaus-Heiner Lehne, ECA President; Janos Bertok,

OECD; Anton Colella, ICAS

EU citizens seem to no longer trust national and EU institutions

According to the Eurobarometer survey of spring 2016, only a third of European citizens trust

the European Union and even less trust their political institutions at national level. The EU

and its Member States are facing ever greater challenges. Pressure on public inances, youth

unemployment, lack of or insuicient economic growth, migration represent only some of the

issues contributing to an apparent loss of trust of citizens.

Do SAIs have any role to play in this respect? And if so, what would be the preconditions for

making a diference? These are questions we have been asking internally and proposed as lead

discussion topic for the 2017 meeting of the Contact Committee.

Nationalising success and europeanising failure – not the

way forward

In his keynote speech Jean Arthuis, MEP and Chair of the EP's

Budget Committee, welcomed the topic chosen for this meeting.

He recalled the tendencies of some politicians across EU Member

States to nationalise success and europeanise failure. The distrust

is also relected in the rising popularity of political parties and

movements with populistic tendencies and anti-European

propaganda.

But not all politicians see it this way. Readers may remember the

statement of President Emmanuel Macron: “Bruxelles, c’est nous,

toujours”. ECA President Klaus-Heiner Lehne recalled that Europe

is at a turning point and expressed a positive vision of the future.

It remains vital to work together and steer the European Union

project to a safe harbour. For this to happen, Contact Committee

members agreed that it is important for citizens to also regain trust

in their national institutions.

Members of the discussion panel

Jean Arthuis,

European Parliament

Janos Bertok,

OECD

Anton Colella,

ICAS

Vítor Caldeira,

SAI of Portugal

Tytti Yli-Viikari,

SAI of Finland

Alex Brenninkmeijer,

ECA

Kay Scheller,

SAI of Germany

Arno Visser,

SAI of the Netherlands

Didier Migaud,

SAI of France

Gerhard Steger,

IMF expert

(video interview)

Event chaired by

Klaus-Heiner Lehne,

ECA President

Discussion moderated by

Brigitte Christ,

SAI of Switzerland

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Can SAIs contribute to restoring the trust of EU citizens?

continued

Positive audit indings should also be published

There is probably no doubt that external auditors should report on audit indings and stick

to the facts. Participants agreed that this is sometimes limited to reporting on shortcomings.

In this context, Arno Visser (SAI of the Netherlands) stated that SAIs should also acknowledge

progress and good practice, if supported by evidence. He recalled a situation when auditors in

his own institution suggested not publishing a report for lack of negative indings, which he

refused. Balanced reporting, in his view, is the way forward to recreating trust.

Meeting participants considered that the lack of negative indings does not imply a wrongly

chosen audit topic. In such a case, the public can rest assured that the policy and relevant

spending is implemented in an eicient way, which contributes to building trust by itself. In this

context, participants agreed that the core issue seems to be whether SAIs are able to “sell” good

news in a way that moves people and attracts the attention of media.

Deciding what to audit

Probably every Head of SAI will agree that it is not easy to decide what to audit regarding the

efective and eicient use of resources. But next to making informed decisions based on risk

assessment SAIs may also consider looking into issues that, as Gerhard Steger (IMF expert) put

it, “move” the citizens. He acknowledged that addressing certain issues may require courage on

the side of SAIs, as the choice may not be appreciated by the administration.

If trust was absolute…

Anton Colella, CEO of the Institut of Chartered Accountants of Scotland (ICAS), delivered a

motivating speech on the audit profession as a value-driven service to society. He considered

that ‘If trust was absolute, there would be no need for auditors’. Until then, auditors should play a

role in building trust of citizens in their institutions.

Cookbook for SAIs: timeliness, clear language, innovative and tailored

communication

Panellists and external speakers highlighted the importance of a proper timing of audit work,

to allow for policymakers to take into account the auditors’ recommendations when deining or

renewing policies. As Tytti Yli-Viikari (SAI of Finland) put it: ‘Audit reports should be served as a

pizza. Good quality ingredients are key. But if not hot, nobody really wants it.’

Several participants indicated that clear language in audit reports is paramount to making a

SAI’s message understood by the intended recipients. But apart from producing reports which

avoid, as far as possible, the use of technical jargon, the way forward is to adapt reports to

the speciic audience. In a survey undertaken during the preparation of the meeting, some

SAIs indicated that they are taking steps in this direction. The ECA has, for instance, recently

introduced audit briefs, providing background information on preparatory work undertaken

before the start of an audit. It also closely cooperates with European Parliament reporters

responsible for ensuring follow-up to its reports in the European Parliament. Arno Visser stated

that ‘it is not easy to identify the best way to present facts to intended groups of recipients. In

some cases it may be a report, in other cases it could be a conference, a fact sheet, or even a

tweet.’

The above-mentioned survey also conirmed that regular communication with the press

and making use of the social media has basically become a standard for EU SAIs. To give an

example, the UK National Audit Oice has over 130 000 and the French Court of Accounts

over 61 000 followers on Twitter. The number of followers of the ECA’s Twitter account is lower

but is growing steadily. LinkedIn is often used both for presenting results and for recruitment

purposes.

SAIs are also making an increasing use of video-streaming services to present their work. Didier

Migaud (SAI of France) illustrated how eicient a SAI can be in presenting a 260 page-long audit

report in a 100 second video. The ECA has also established a team for creating video reports to

present results of audit work or announce upcoming events, such as high-level conferences or

the presentation of the annual report.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Can SAIs contribute to restoring the trust of EU citizens?

continued

SAIs demonstrated their openness to modern technologies and innovative ways of

communicating with citizens. Over the past year, the SAIs of the Czech Republic, France, and

the Netherlands have organised hackathons for an interested public to work with open data

and develop useful applications for the public service to work with. To give another example,

the Czech SAI presented its Benchmarking Indicator Exchange Project, a recently established

platform for SAIs to share indicators to facilitate international comparison and audit work.

The discussion did not aspire to adopt formal conclusions on the SAIs’ role in this respect.

However, some of the preconditions for SAIs to be able to pursue this task can be summarised

as follows: (i) relevance of the chosen topics for the society, (ii) courage/preparedness of SAIs to

choose topics and give recommendations which may not be appreciated by the administration,

(iii) balanced/fair and tailored/innovative reporting, (iv) use of clear language for citizens to get a

good understanding of the report without having speciic knowledge of the audit topic, and (v)

timely publication of reports for them to be taken into account when deining policies.

Contact Committee reports on parallel audits

In the ensuing sessions, the Contact Committee took note of the work carried out by its working

bodies and agreed on the next steps. The Working Group on Structural Funds, chaired by the

SAI of Germany and the Netherlands, presented its report on the contribution of structural

funds to the Europe 2020 Strategy in the areas of employment and/or education. The Network

on Fiscal Policy Audit, under the leadership of the SAIs of Finland and Sweden, presented its

audit on the underlying risks to sustainable public inances. Both reports are available on www.

contactcommittee.eu. Moreover, a report on a parallel audit on the banking supervision of less

signiicant banking institutions – carried out under the leadership of the SAIs of Germany and

the Netherlands – should be presented in the coming months.

The next Contact Committee meeting will be held in Croatia.

Meeting of SAIs of EU Candidate Countries and Potential Candidates

Heads of SAIs of EU Candidate Countries, Potential Candidates and the ECA met in Luxembourg

on the eve of the Contact Committee meeting to take stock of recent activities and agree on a

work plan for the years to come.

An important project discussed at the meeting was the parallel performance audit on public

procurement, which has been led by the SAI of Sweden and supported by ECA experts, and is

coming to its closure. The ECA will also assist in publishing the joint summary of the national

audits.

All heads of SAIs of Candidate Countries and Potential Candidates participated in the Contact

Committee meeting as active observers. This allowed for useful bilateral contacts with their EU

counterparts, with whom they have undertaken or plan to undertake capacity building projects.

Contact Committee meeting,

12-13 October 2017 at the ECA

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Can SAIs contribute to restoring the trust of EU citizens?

continued

Fragments of the presentation The EU we live in. And why some citizens seem

to not trust their governments and institutions anymore? of Jean Arthuis,

MEP and President of the EP Budget Committee

Le thème que vous avez choisi de traiter ( ) est d’une brûlante actualité. (...)

L’euroscepticisme est à l’œuvre, il s’exprime et se mesure lors des consultations électorales.

Pour y faire face, l’Europe aiche sa pusillanimité et peine à sortir de son silence. (...) N’est-

il pas temps, à l’heure de la mondialisation, d’admettre que l’Europe est bien notre nouvel

espace de souveraineté et d’en tirer les conséquences? (...) La tyrannie du court terme

prive l’Europe d’une expression audible. Et puisqu’elle ne parle pas aux Européens, il n’y

a pas d’opinion publique européenne. Et pourtant les citoyens ressentent le besoin de

biens publics dont certains ne peuvent désormais plus être assurés par les États nations.

La liberté, la paix, la sécurité, la solidarité, le développement durable, sont autant de biens

publics qui ne peuvent plus être assurés sans le concours de l’Europe. Pour l’immédiat,

l’Union européenne tarde à se donner un cap. C’est dans ce contexte que nous sommes

invités à préparer un nouveau cadre inancier pluriannuel - post 2020 - sans accord

préalable sur une vision et un projet politiques. Étonnante logique ! (...)

Et pour verrouiller le tout, les crédits sont corsetés dans un cadre inancier de sept ans.

Budget rigide, démuni face aux situations de crise. Sous la pression de l’urgence et de la

nécessité, il faut improviser des satellites budgétaires (Mécanisme européen de stabilité

inancière, Trust-funds, fonds de garantie) dotés tout à la fois par le budget de l’UE et ceux

des États membres, échappant à tout contrôle parlementaire et transgressant le principe

d’unité budgétaire. En conséquence, nous mettons en scène une véritable galaxie

budgétaire illisible par les citoyens européens. (...) Le budget n’est pas comprehensible

pour le citoyen. Illustration d’une Europe qui ne leur parle pas. (...) Au surplus, l’Europe,

faute de ressources propres, est déchirée par la tyrannie du « juste retour », les Etats « net

receveurs » s’opposent aux « net contributeurs ». (...)

Au reste c’est votre vocation. Vous êtes donc appelés à jouer un rôle déterminant. (...)

Dès lors, vous devez exiger de ceux qui exercent le pouvoir de présenter des budgets et

des comptes lisibles et compréhensibles par les citoyens. Je vous invite en conséquence

à vous ériger en défenseurs du principe d’unité budgétaire, et même d’universalité

budgétaire. (...) Vous êtes les garants de la sincérité. Dit autrement, vous assurez la lucidité

des gestionnaires publics et des citoyens. Certes la lucidité ne suit pas. Sans le courage,

elle ne sert à rien. (...)

Je vois, comme vous, que la meilleure régulation de la dépense publique c’est la

transparence. (...) L’accès public aux données est désormais rendu possible par la

digitalisation. Ce contrôle du détail, à la loupe, ouvert aux citoyens viendrait en

complément de vos propres diligences, à tous égards irremplaçables car vous disposez,

vous, de la longue vue. (...)

Ma première recommandation est un encouragement à refuser de certiier la sincérité

de documents comptables et inanciers incompréhensibles ou illisibles. (...) La seconde

recommandation suggère qu’au-delà du respect de la règle, vous tentiez d’évaluer la

performance et la valeur ajoutée des dépenses engagées par l’Union européenne. (...)

… vous avez compris que c’est grâce à vous que les citoyens européens retrouveront

coniance en leurs gouvernants et, sans doute, en eux-mêmes. Votre vigilance est

l’aiguillon de la bonne gouvernance.

Jean Arthuis

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Can SAIs contribute to restoring the trust of EU citizens?

continued

Fragments of the presentation Can SAIs contribute to restoring the trust of EU

citizens? by Janos Bertok, Head of Public Sector Integrity Division, OECD

Since the inancial crisis it is all about trust. (...) What are the levers to restore, maintain and

foster trust? (...) Two thirds of the countries are experiencing low levels of trust, dealing

with declining levels of trust. (...) An important element for undermining trust is when

public funds is misused. Examples can be found in South-Korea and Brasil. For the latter

the story started with the non-approval of the accounts by the Brasilian SAI. So this shows

the role SAIs play in the application of rules. (...)

What we can do as government and institutions to regain trust. There are two important

levers: competence and values. (...) Starting with competence: three key drivers: reliability,

responsiveness and eiciency. But what does it mean? For reliability it means anticipating

the challenges, for example of ageing, or migration. When there is a concrete challenge

situation: how is this handled. How do you verify the impact of the action: this is a role of

SAIs, to verify the efects of the responses. (...)

The second lever is values. A key driver here is integrity. Are SAIs verifying the integrity of

the inancial management. Are you actually verifying the integrity of the accounts and of

the public administration? Public administration and big data. To re establish trust citizens

make websites to track inancial lows, etc. You can ind such initiatives in Australia or

Brasil, enabling f.e. following the use of a corporate credit card. (...)

Another lever is fairness. How do young people feel about public government? What is

the impact and how it that measured. This is something for a inance ministry and a SAI:

include speciic key performance indicators in each part of the budget. For example: what

is the information about gender balance. A traditional way of auditing can trigger big

movements on gender issues. I am very interested to hear the views of SAIs on tools and

practices in Europe to restore and regain trust.

Janos Bertok

Fragments of the presentation Trust in SAIs: audit as a value-driven service to

society by Anton Collela, CEO of Institute of Chartered Accountants Scotland

(...) We saw the 2015 report on conidence and governance, the Edelmann report which

was published this year. ( ) You know who they trust most according to the Edelmann

report? Not whiskey manufacturers. Accountants and auditors! (...) Society today is looking

for people they can trust. We are in the business of trust. (...)

How do you know you are trusted? How do you know that the work you are doing

generates trust among the people? (...) I would think that one of the KPIs I would ask

from auditors general in their countries is, since we all know that the great political

commentators, to ask the wise people in a country who are…the taxi drivers. (...) Today

modern politics and democracy takes place…here. Look at the US, they do not need

Congress, they just need mobile phones. We are seeing political policy in 400 characters,

on a phone, by Twitter. The nature of government and public accountability and the

business of trust is becoming far more public than ever before. (...)

Did you know that when you choose or accepted to become an auditor general or

working as an auditor in the ECA, that you were taking on one of the most noble roles

in Europe today. My institute, the Institute of Chartered Accountants of Scotland, is the

oldest in the world. And the founders of this institute were very wise because they created

a motto to serve the generations to come. It was two Latin words: Quaere Verum:( ) seek

the truth. (...) Everybody who wants to become a member of my institute has to realise

that they are taking on one of the most noble roles in society today. (...)

Audit and audience come from the same root. Who is your audience today? (...) Who do

you serve? I would say: this is a community of truth that serves the truth. This is unpopular

today: there are few people in our society today who stand by vocation to serve the truth.

Anton Collela

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Can SAIs contribute to restoring the trust of EU citizens?

continued

(...) Do the people of the parliament or the elected center, are they proud of their auditor-

general? They may not like you, but are they proud? The greatest indicator of our success

is the respect that we gain from those we serve. (...)

When you join a profession you make a promise. What promise have you made and who

have you made the promise to? Did you make the promise to parliament or to the people

of your countries? And the promise, I believe, is to seek the truth, to ind the truth, and

to speak the truth. We heard the word earlier on, ‘courage’. To be an auditor today you

must have courage. If you do not have courage, go and ind another job! Go serve in

government, go and run another department. If you do not have courage, if you feel you

do not have enough courage, you are sitting in the midst of a community of courage. And

you should support one another and exemplify the ‘courage’ for each other.

Contact Committee meeting,

12-13 October 2017 at the ECA

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Restoring trust of citizens: a topic SAIs

clearly need to be engaged with

Interview with Brigitte Christ, Vice President (Stellvertretende Direktorin)

of the Swiss Federal Audit Oice

By Gaston Moonen, Directorate of the Presidency

Through EUROSAI meetings and peer review contacts the ECA got

to know Brigitte Christ. As moderator for the seminar of the EU

Contact Committee (see previous pages) Brigitte used a stimulating

and sometimes unorthodox approach, which was widely

appreciated, to assure a powerful exchange of views. Also during

the lively interview I had with her some days after the seminar, she

did not shy away from clear and thought-provoking views.

Trust as a key issue for the Swiss SAI

For Brigitte the topic of public trust in society is a familiar one and also

very relevant for her SAI. Brigitte clariies: ‘Swiss citizens have a strong

legal basis on rights for access to oicial information produced by the

federal administration and as SAI we need to ask very day how we can

support citizens in this right to transparency.’ For her the question is not

whether but more how the SAI can live up to this need for transparency.

‘Sometimes there is also some inherent mistrust towards SAIs, based

on ‘they belong to government as well,’ a feeling which should not be

underestimated. But often SAIs have a solid level of trust.’ In Switzerland

the federal SAI is also the contact oice for whistle blowers for the federal

administration, so for people who have speciic concerns. Reason the

more for Brigitte to live up to expectations regarding transparency.

Provoking questions meet openness and sharing experiences

From the seminar participants a lot of appreciation came back as

feedback for the lively way Brigitte moderated the seminar. This also

pertains to the provoking questions Brigitte raised to both speakers

and participants, like where the SAIs were in times of declining levels

of public trust, whether SAIs are really perceived as noble guardians of

public interests, whether SAI reports are really used and understood,

and whether auditor-generals actually experienced concrete situations

requiring courage to stand up and bring things forward and into the

public realm. When asked whether she got some replies to these

questions Brigitte is very positive: ‘I really appreciated the openness of

the participants, sharing self-critical comments on their role and where

they can improve. Several people indicated what national problems

they face, including attempts to impede a SAI’s independence, for

example regarding audit planning, recruitment/appointment policy, or

government pressure to inluence how SAIs communicate to the outside.

Brigitte zooms in on another challenge raised at the seminar: ‘For SAIs

publishing recommendations is one thing, getting them implemented,

thereby transferring ownership of them to the executive, is a lot more

diicult.’ Brigitte found the call for courage from Anton Colella to be a

critical point and a notion that was shared among participants. She adds:

‘Often enough there are situations that require a tough standing of SAI

presidents and their staf.

Brigitte Christ

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Restoring trust of citizens: a topic SAIs clearly need to be engaged with

continued

Rebuilding trust: who is responsible for what

During the seminar there was a broad understanding that it is the ultimate task of

the government to rebuild trust with citizens. Brigitte explains this further: ‘Only

if government is willing to move at all then SAIs can contribute. Regaining the

trust of citizens in government operations and its ability to help people is not a

battle SAIs can do alone. A SAI cannot do the work of government in this respect.’

Whether a government is really active in rebuilding trust or not will certainly

afect a SAI’s work: ‘If we claim to say our work is to equally work for the citizens to

put their demands and their needs in the focus of our work - which was the broad

understanding during the seminar - then SAIs have to reach out to address these

concerns and not focus only on how SAIs themselves are trusted. If we say that

SAIs work for the citizen we cannot blend out, then we need to push government

if they are not willing to move into the right direction. This might sound over

ambitious but we cannot avoid this if a SAI wants to be relevant and provide real

added-value. It is not suicient to audit whether things are done the right way, we

have to challenge whether government is doing the right things as well.’

Is there a paradox for SAIs, meaning that the more efective SAIs may be in

revealing weaknesses in government, the more they might undermine public

trust in government? This is only one part of the story. For Brigitte the bottom line

is that ‘if citizens see that there are consequences, for persons and/or processes,

related to our indings, so that there is a follow-up and a learning efect, it really

works in rebuilding trust.’ For Brigitte this means one can speak of a symbiosis of

accountability on the one hand and a learning government on the other hand

since you need to make responsibilities explicit and see progress. She laughs

when adding: ‘One should not underestimate the brains of citizens, most of them

are smart enough!’ She adds that this goes for many issues, including corruption,

referring to points brought by Janos Bertok, one of the speakers: ‘Essential is that

something happens to address the roots for corruption, if nothing happens trust

will not increase.’

Healthy level of mistrust as part of the system

When asked what for her the most striking element of the seminar was Brigitte

responds quickly: ‘My personal highlight was: if we talk about trust, please do

not understand this like your government will always act in your interest and

be correct in everything. That is not trust. Trust, or actually a healthy level of

mistrust, as was highlighted by one of the SAI presidents, is a key element of

every democracy. It is not conined to trust in government but more about trust

in the system of checks and balances.’ And for Brigitte SAIs are part of this system:

‘A healthy element of mistrust is actually a basic element of the system in which

SAIs operate.’

Brigitte concludes with remarking how seriously impressed she was by the

engagement of the participants: ‘It was clear for me that this subject of trust and

how SAIs can contribute to that got under their skins. The willingness to be so

open and direct among each other was very refreshing. So ‘chapeau’ for the ECA

to have chosen this topic and the excellent presenters - and having invited me to

moderate this seminar.’

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Stakeholders discussing challenges ahead

ECA conference on the Landscape Review EU Action on

energy and Climate change

By Olivier Prigent, Directorate Sustainable use of natural resources, and Katharina Bryan,

Private Oice of Phil Wynn Owen, ECA Member

The ECA, in cooperation with the European

Parliamentary Research Service, held a

conference on 17 October. More than

110 persons attended the conference.

Attendees ranged from the public

sector - with representatives of Member

States, EU institutions, Members of the

European Parliament, ECA members

and representatives of Supreme Audits

Institutions - to the private sector, and to

NGOs, think-tanks and academics. Olivier

Prigent, Head of Task, and Katharina Bryan,

co-author of the Landscape Review, report

on this event.

The ECA Landscape Review on EU action on Energy and Climate Change, published on 19

September, provides an overview of EU action on energy and climate change; summarises key

audit work from 269 audit reports by the European Court of Auditors and EU national audit

institutions; and identiies seven main challenges in order to inform both the legislative debate

and future audit work.

Organising a conference

to provide a platform for stakeholders to discuss the challenges ahead

was an integral part of the work on the landscape review. Before the conference the Landscape

Review had already been presented in two European Parliament Committees- -- for Budgetary

Control, and for Industry, Research and Energy - as well as in an enlarged Council Working Group,

bringing together Energy, Climate and Environmental Member States representatives.

Main challenges identiied by the Landscape Review

Source: ECA

1. Many thanks go to conference manager Mush Chowdhury who, together with Gareth Roberts, worked tirelessly to make

this event possible

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Stakeholders discussing challenges ahead

continued

In 2016, on average, the world was already 1.1°C warmer than in the pre-industrial period.

This increase of temperature is linked to the increasing greenhouse gas concentrations in

the atmosphere. Energy and climate change are closely interlinked. For example, in the

EU, energy production, mainly from the transformation and combustion of fossil fuels, and

energy use – by e.g. industry, households and transport – account for 79% of EU greenhouse

gas emissions. As a result, efective action on energy production and its use is essential to

tackle climate change.

The EU has set targets to reduce greenhouse gas emissions by 20% and 40% respectively

for 2020 and 2030. By 2050, the EU intends to reduce EU greenhouse gas emissions by

between 80% and 95% compared to 1990. All economic sectors will need to contribute. To

achieve the 2030 targets, the European Environment Agency estimates that annual emission

reduction eforts will need to increase by half in the next decade. Beyond 2030, the emission

reduction rate will need to outpace historic levels by three to four times in order to achieve

the 2050 objective.

But even if eforts to cut greenhouse gas emissions are successful, adaptation to a changing

climate is necessary. Europe’s climate will be signiicantly diferent from today even under

the 2°C temperature increase envisaged by the 2015 Paris agreement. On top of higher

temperatures, Europe could see, by the end of the century, rain and snow patterns increase

by 25% in winter in certain regions and decrease by 50% in summer.

The Conference

The conference was opened by ECA Member

Phil Wynn Owen, rapporteur for the

Landscape Review,

and MEP

Jerzy Buzek,

Chair of Committee on Industry, Research and

Energy. During the two following panel discussions, moderated by

Anthony Teasdale,

Director-General of the European Parliamentary Research Service, and by

Phil Wynn

Owen,

speakers addressed various aspects of the seven main challenges identiied in the

Landscape Review. The speakers of the two panels are presented in the table below.

Panel 1: Energy and climate change - Main

challenges

Jos Delbeke,

Director-General, DG Climate Action,

European Commission : Major challenges in the ield of

energy and climate change policy

•

Hans Bruyninckx,

Executive Director, European

Environment Agency: Knowledge for transitions in

climate and energy policies

Sabrina Schulz,

Head of Berlin Oice, E3G: Ensuring

a just transition for all Europeans

Olivier Prigent,

Head of Task, European Court of

Auditors:

Presentation of ECA's Landscape Review: EU action

on energy and climate change

Katharina Bryan,

attachée, European Court of

Auditors: Presentation of ECA's Landscape Review:

EU action on energy and climate change

Panel 2: Energy and climate change: Working

together

•

Benedek Jávor,

MEP, Vice-Chair of the Committee

on Environment, Public Health and Food Safety,

European Parliament: Is the EU doing enough to stay

below 1.5 degrees?

Carmen Becerril Martínez,

Energy Industry Expert,

Spain: The transformation of the energy sector.

Towards a more eicient and sustainable model

Nancy Saich,

EIB Chief Climate Change Expert: From

Finance to Impacts: How EIB supports improved

planning and investment for mitigation and

adaptation

Martijn Broekhof,

climate change and energy

economist, who had assisted the ECA with the

Review: The Paris Agreement as a governance

experiment – implications for Europe

Mechthild Wörsdörfer,

Director, Renewables,

Research and Innovation, Energy Eiciency, DG

Energy, European Commission: Facing challenges:

the Clean Energy for all Europeans Package

•

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Stakeholders discussing challenges ahead

continued

Governance

In the energy domain, the EU and Member States have shared competences. But choices in

one Member State can afect the situation in other Member States and the achievement of

overall EU targets. In both energy and climate change, the EU and the Member States need to

work together.

During the panel discussion, speakers underlined that efective governance systems are

needed in the EU to manage and monitor energy and climate measures.

Public audits can also play an important role in ensuring public accountability on the

achievement of commitments, and in maintaining citizens’ trust.

The energy transition

Profound changes are still needed in the electricity system to deal with challenges such as

the variability of energy production from the growing intermittent renewable energy sources,

storage and decentralised energy production. Energy infrastructure within and between

Member States is not yet fully designed for integrated markets. Generation overcapacity

creates little incentive to invest in new capacities and networks. Capacity payments are liable

to distort competition if they are not designed properly.

Similarly, the transport sector will have to undergo changes in energy use, switching to less

carbon-intensive transport modes and using alternative fuels, such as electricity.

Infrastructure investments will need to be based on a long-term understanding of their

climate and other impacts. New or existing high-carbon assets may need to be shut down

earlier than anticipated, thus requiring social adjustments. We need to prepare for these

equitable transitions needed in many regions which may have to abandon energy generation

from, for instance, coal or nuclear.

All contributors agreed on the need for action on energy and climate change. It was

underlined that today’s investment decisions will either open the pathway to achieve

the 2050 objectives or will result in a lock-in efect not in line with the necessary scale of

decarbonisation required. Some speakers said that the commitments made do not add up

to the Paris pledge to keep the rise in global average temperature this century to ‘well below’

2°C above pre-industrial levels, aiming to limit it to 1.5°C.

Adaptation

Even if eforts to cut greenhouse gas emissions are successful and the global temperature

rise remains below the Paris agreement of no more than 2°Celsius on a pre-industrial level,

adaptation to a changing climate is necessary. The 2°C increase scenario is a global average:

even if it is achieved, temperatures will increase by far more than 2°C in certain regions. For

instance, in the summer, temperatures could increase by 3 to 4° in much of Spain. In addition,

summer rainfall there could decrease by 50% or more

, risking desertiication.

These temperatures might be much worse since many think the world is not on track for no

more than 2° average. In its Emissions Gap Report of 2016, the United Nations Environment

Programme estimates for global warming of up to 3.4°, based on their current commitments.

Models can be used to describe and forecast the impacts of climate change. This is an

important but challenging task. It will be a great challenge for the EU and Member States to

anticipate and plan adaptation, reducing the need to act in response to events, which would

cost much more.

Climate Impacts in Europe, the JRC PESETA II project, 2014. Data from Dosio and Paruolo 2011 and Dosio et al 2012.

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Stakeholders discussing challenges ahead

continued

Summer temperature change, in °C,

for 2071-2100, compared with 1961-1990

(2°C global increase scenario)

Source: Adapted from Climate Impacts in Europe

Financing

According to the European Commission

, 1 115 billion euro will be needed annually in the

period 2020 to 2030 to mitigate climate change in the EU. This funding will obviously have

to come from both public and private sources. In addition, there will be the costs of adapting

to climate change, which are diicult to predict.

The panel highlighted another challenge in inancing: a 2016 ECA audit

found that nuclear

decommissioning costs usually do not include costs of long-term storage of high-level

nuclear waste; but, when such costs are added to the decommissioning cost, the inal bill

can double – making nuclear decommissioning and storage a pressing and costly challenge

for the EU and its Member States.

Innovation

Achieving longer term energy and climate targets will require new technologies to be

developed. The power sector will also require better and more cost-eicient energy storage.

Achieving signiicant emissions reductions in transport will require the development of

alternative fuels.

But according to the French Court of Auditors

, there is no certainty that such future

technological breakthroughs will be both technically possible and widely, economically

accessible. Indeed, it often takes years for a new technology to become usable on an

industrial scale. Thus, extensive progress in developing the technologies needed to reduce

emissions between 2030 and 2050 will have to be made in the next decade.

Commission,

Impact assessment accompanying the document ‘Proposal for a Directive of the European

Parliament and of the Council amending Directive 2012/27/EU on Energy Eiciency’,

SWD(2016) 405 inal/2 of

6.12.2016, Table 22 (Scenario EUCO30 –

Source:

Primes model

Special Report 32/2016: EU nuclear decommissioning assistance programmes in Lithuania, Bulgaria and Slovakia :

some progress made since 2011, but critical challenges ahead, ECA, 2016

The implementation by France of the package energy-climate, Cour des Comptes, France, 2014

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Stakeholders discussing challenges ahead

continued

Evidence-based policy

Policy-making and policy implementation should be informed by the best available data,

modelling and analysis. This is a challenge for energy and climate change topics because of

their complexity, the relative novelty of some of the data, and the pace of change arising.

Good data, analysis and models will be needed for the integrated national energy and

climate plans that Member States would have to prepare in the framework of the proposed

Regulation of the Governance of the Energy Union.

EU Citizen

One speaker observed that each of us has to rethink about her or his habits of how we can

contribute. There are many ways the EU citizen can facilitate the low-carbon transition.

Therefore, the involvement of the citizen is essential for understanding, changing

behaviours and paying for necessary transitions.

Overall, the conference provided a perfect opportunity to discuss among stakeholders, a

place to network for our audit teams and to relect on the ECA’s work in the area.

From left to right:

Katharina Bryan, Attaché in Phil Wynn Owen's

Private Oice; Phil Wynn Owen, ECA Member ; Jerzy

Buzek MEP, Chair of Committee of ITRE Committee,

European Parliament; Anthony Teasdale, Director-

General, European Parliamentary Research Service;

Jos Delbeke Director-General DG Climate Action,

European Commission; Sabrina Schulz; Head

of Berlin Oice, E3G; Hans Bruynickx, Executive

Director, European Environmental Agency

For more information on the Landscape Review:

Visit

http://www.eca.europa.eu/en/Pages/DocItem.aspx?did=41824

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Follow-up of audit recommendations:

the ECA experience

By Nikolaos Milionis, ECA Member

Following-up recommendations is an essential step

concluding the audit cycle and serves two main purposes.

Firstly such follow-up encourages the auditees to implement

recommendations. Secondly it also provides useful feedback

on the impact of the auditor’s work. After presenting how the

ECA deals with the follow-up of its recommendations, Nikolaos

Milionis discusses in this article some main challenges the ECA

is facing in this area.

Nikolaos Milionis, ECA Member (Middle)

This article is based on a speech Nikolaos Millionis gave on

4 October 2017 at the conference on “External audit, performance,

risk management in International Organizations” organised at the

French Cour des comptes, jointly with the International Board of

Auditors for NATO and the University Paris 1 (Panthéon Sorbonne)

ECA’s current practice: assessment of follow-up given to our recommendations

ECA recommendations made in Special Reports

Throughout the year, the ECA produces Special Reports, which are mainly performance audits on a speciic

EU policy. In 2016, 36 of them were issued including a total of 337 recommendations, more than ever before.

These cover a wide range of topics in all budgetary areas.

Source: ECA 2016 Annual Report

1. He expresses his gratitude to Kristian Sniter for his decisive contribution to the drafting of this article.

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Follow-up of audit recommendations: the ECA experience

continued

Three quarters of the recommendations have been fully accepted by the auditee. Another

10% have been partially accepted. Only 9% have not been accepted.

Source: ECA 2016 Annual Report

Follow-up of ECA recommendations

The ECA deals with recommendations in a uniform way. The implementation of all

recommendations is checked after a standard period of 3 years, leaving suicient time for

the auditee to take action. The follow-up of all recommendations is presented in the ECA’s

Annual Report together with the Commission’s replies.

Our assessment of follow-up is presented using a grid with 4 levels. A recommendation will

be classiied as either ’Not implemented, ’Implemented in some respects,’ ‘Implemented

in most respects’ or ‘Fully implemented.’ In some cases, a recommendation might also be

considered as no longer relevant - for instance, due to legislative changes - or insuicient

evidence might be available to assess the implementation.

In 2017, we followed up the 131 recommendations issued in the 13 Special Reports

published at least 3 years before. About two thirds of the recommendations had been

fully implemented. An additional 28% were partially implemented, leaving only 5% not

implemented.

Source: ECA 2016 Annual Report

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Follow-up of audit recommendations: the ECA experience

continued

There was even improvement on recommendations that the Commission had initially not

accepted: 10 out of the 11 recommendations initially not accepted were subsequently

implemented partially or in full.

Three challenges

The quality challenge: the better the recommendation the better the follow-up

Drafting good recommendations is key to an efective implementation and follow-up.

These are more likely to be accepted by the auditee and then later be implemented.

Following up should be easier and less subjective if there is a mutual understanding

on what is to be delivered and what beneits are to be expected. This is why the ECA’s

Audit Quality Committee has recently updated the internal guidance on “Writing audit

recommendations”

The guidance irst puts emphasis on the need for continuous dialogue with the auditee,

with the aim of achieving, if possible, mutual understanding between auditors and

auditee, as to the audit conclusions and recommendations. These discussions should form

the basis of constructive interactions on the appropriateness and feasibility of the draft

recommendations, and what the auditee’s probable responses to them will be. This is part of

what the ECA calls the ‘no surprise approach’ it adopts with the auditee.

In their replies to the report, auditees need to indicate clearly what speciic measures their

services intend to take in response to the recommendation. Where possible and appropriate,

they should make reference to an action plan and indicate deadlines for the actions. In all

cases they must clearly indicate if they accept or reject a recommendation and the reasons

for the latter. If they partially accept a recommendation, they must indicate which part they

do not accept and why.

Recommendations guide the actions needed to correct the problems identiied in the

report. But it is up to the auditee to decide what the detailed actions should be. The ECA’s

guidance earlier referred to deines a list of SMART quality criteria, which help in drawing up

appropriate recommendations.

SMART stands for:

Speciic:

describing what needs to be done —but without being overly prescriptive;

Measurable:

deining, at the recommendation drafting stage, the indicators or criteria to

be used later for follow-up.

Achievable:

taking into account legal or technical constraints and cost‐beneit

considerations;

Relevant:

fully supported by the audit indings and correcting the underlying causes of

the deiciency;

Time‐bound:

setting out a realistic time period for their achievement.

The challenge of the extent of the follow-up: not limited to checking implementation

Regarding the follow-up of these SMART recommendations, ISSAI

standards give some

indications on the purpose and scope of this exercise. ISSAI 300 speciies that ‘Follow-up

is not restricted to the implementation of recommendations but focuses on whether the

audited entity has adequately

addressed the problems

and remedied the underlying

situation

after a reasonable period of time.

’

ISSAI 3000 adds another dimension to the

2. Guidance – Writing audit recommendations – November 2016

3. ISSAI stands for International Standard of Supreme Audit Institutions

4. ISSAI 300 - Fundamental Principles of Performance Auditing - paragraph 42, bold added by the author

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Follow-up of audit recommendations: the ECA experience

continued

follow-up of recommendation that I mentioned in my introduction. The standard states that

’Reliable information on the implementation status of recommendations,

the impact of audits

and the relevant corrective actions taken,

can help

demonstrate the value and beneit

of the SAI.

’ The follow-up process serves not only to assess the auditees’ actions, but also the

audit itself.

While the standards direct the auditor towards the most challenging issues, they are not

too prescriptive on how to carry out the follow-up process. Much is left to the auditor’s

appreciation. ISSAI 300 does not require all recommendations to be followed up. Similarly,

ISSAI 3000 leaves it up to the auditor to decide the depth of the follow-up carried out. It states

that ’The auditor needs to decide which (if not all) recommendations are to be followed up and

how follow-up will be undertaken (by

means of a new audit or a simpliied procedure)’

The auditor is facing trade-ofs and has to ind the right balance. To be more representative

and ensure that the auditee does not overlook some maybe less important recommendations,

one might want to select most, if not all recommendations, for follow up. To be in a better

position to assess the impact of the audit and demonstrate its added value, one might be

inclined to carry out more in-depth audit procedures, for instance, in the form of a follow-

up audit. However, an exhaustive and in-depth approach would be very costly. The auditor

must therefore consider the costs of the diferent possible options and carefully assess their

comparative beneits.

The ECA opted for a dual approach. On the one hand, it reports annually on all

recommendations made three years ago, on the basis of a documentary review and interviews

with Commission staf. On the other hand, it may decide to produce a new special report on

the same (or a similar) topic. A new audit of the area is then carried out, including the follow-up

of the previous recommendations. These audits contribute to demonstrating the added value

of the previous audit and the efectiveness of the corrective actions taken by the auditee. Out

of 24 Special Reports from 2014 that are currently being following up, we will cover eight in the

form of a new Special Report. The choice of the past audits that deserve to be fully followed up

is made as part of the ECA’s multi-annual programming process, during which the added value

of each audit proposals, including new audits and follow-ups, is assessed.

For follow-up to be more efective, it should attract the stakeholders’ attention. Members of

Parliament, the media, NGOs or the general public should be provided with simple tools to

keep track of the progress made in dealing with the key issues raised in the external auditor’s

reports.

The follow-up of recommendations holds a central place in the ECA’s Annual Report, our most

read and publicised product and is part of Chapter 3 on ‘Getting results from the EU budget.’

The Annual Report and its Statement of Assurance on the management of the EU budget is

one of the main tools used by the Parliament to hold the Commission to account during the

annual discharge procedure.

The French Cour des Comptes also reports on their follow-up in their annual report. The reader

will appreciate the straightforward presentation of the results. The French Cour des Comptes

presents its assessment either by noting progress (‘La Cour constate des progress’), insisting

on the insuiciency of implementation (‘La Cour insiste’) or alerting on major deiciencies (‘La

Cour alerte’).

Another way of attracting attention is also used by the United States General Accounting

Oice (GAO). It has recently made available an online database with all open recommendations

(https://www.gao.gov/recommendations). It is searchable by topic or agency and gives

updated information on the situation of recommendations. The stakeholders can thereby easily

ind whether the GAO has identiied unresolved issues in their areas of interest.

5. ISSAI 3000 – Standard for Performance Auditing – paragraph 138, bold added by the author. SAI stands for

Supreme Audit Institution

6. ISSAI 3000 – Standard for Performance Auditing – paragraph 141, bold added by the author

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Follow-up of audit recommendations: the ECA experience

continued

The follow-up of recommendations is not only an indicator of the auditee’s performance,

but also an indicator of the auditor’s own efectiveness. The ECA has deined the rate of

implementation of its recommendations as one of its seven key performance indicators

(KPI). The high rate of implementation provides evidence on the high quality of the

recommendations made.

The ECA has not, however, deined a direct measure for the

impact

of its audits. This is

captured through a survey of the stakeholders. The KPI shows that ’in 2016, similar to

previous years, a large majority of the respondents rated the usefulness and impact of the

reports to be ‘high’ or ‘very high’.’

Source: ECA 2016 Annual Report

Some SAIs have taken an extra step. The National Audit Oice in the UK, for instance, has

developed a direct measure of the impact of its audits, deriving from the follow-up. They

currently have a target to deliver £10 worth of inancial impacts for every £1 spent on

running the Oice.

This is an interesting way to demonstrate the added value of external audit. The ECA has

no comparable indicator. Besides methodological issues, one reason might be that most of

our performance audits currently focus on improving the efectiveness and eiciency of EU

policies, rather than reducing their cost.

The challenge of dealing with the diferent layers of management: the case of shared

management in the EU

A third challenge for the auditors is to deal with the diferent layers of management and

their respective responsibilities. Close to 75% of the EU budget is under shared management

by the Commission and the Member States. Under the principle of subsidiarity, Member

States generally specify the objectives, set the eligibility conditions, select the most

appropriate projects, verify their implementation and make the payments. The Commission

approves programming documents, runs audits and evaluations. However, under article 317

of the Treaty on the Functioning of the European Union (TFEU), the Commission holds the

ultimate responsibility for the management of the EU budget. The Commission may apply

inancial corrections when Member States fail to implement the EU budget properly.

The issue of how to address the ECA’s recommendations in this context of shared

management is under internal debate. The current approach relects the direct

responsibilities of the Member States and the Commission. Recommendations related to

the supported projects are mostly addressed to the Member States, as they are in charge

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Follow-up of audit recommendations: the ECA experience

continued

of the implementation. Recommendations to the Commission are generally on guidance and

follow-up of more systemic issues through action plans, overall performance monitoring and

evaluation, and audit.

Recommendations to Member States relect the evidence gathered in audit visits to a

sample of Member States. When recurrent deiciencies are detected, the ECA might issue a

recommendation for them to take action. The expectation is on the Member States visited and

where the weaknesses were identiied. The recommendation also aims at triggering action in

other Member States facing similar situations.

This approach has some drawbacks. It is unsure how serious the issue might be in those

Member States or regions that were not directly audited. Also, as the inal steps of the

adversarial process are carried out only with the Commission, recommendations to Member

States are left without an auditee’s reply. It remains unclear if the recommendation is accepted

and what corrective actions are intended.

As a result, the ECA is currently unable to include recommendations to the Member States in

its formalised follow-up exercise. In 2016, this represented about 7% of the total number of our

recommendations.

In the next Annual Report, the ECA plans to give more prominence to recommendations

addressed to Member States during the year. This will enable them to react to these

recommendations in their replies to the Annual Report

. The ECA will also review its internal

guidelines for making recommendations to Member States.

The Commission has recently committed itself to reviewing signiicant issues with the Member

States for speciic cases in shared management where it had a supervisory role to play. An

ECA/Commission joint working group is currently discussing a possible mechanism for

reporting and verifying these results.

The ECA also plans to work with the Contact Committee of Supreme Audit Institutions of the

EU and the Council to identify collaborative arrangements which might yield further useful

information on Member States’ implementation of recommendations.

Conclusion

Auditors should continuously try to improve their working methods and their added value.

The follow-up of recommendations is a key moment to relect on how well we performed in

the past years, how useful we were for our auditees and what impacts we had for the beneit

of our wider stakeholders.

While we should check thoroughly that the auditees took action, we should at the same time

keep our ears open to listen to their practical experience with the implementation of our

recommendations. There are always lessons to be learnt by the one who listens.

7. For the Member States’ Replies to the ECA’s 2015 Annual Report, see COM(2017) 120 inal issued on 27 February 2017

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Future EU budget decision-making enters

the crucial stage

By Mihails Kozlovs, ECA Member

What will be the main questions surfacing

during the upcoming negotiations for the EU’s

future multiannual budget? And to what extent

will lessons be learnt from the past? With his

experience in working for national government

in Riga and Brussels, and building on the lessons

learnt from ECA work and reports, including those

developed under his leadership, Mihails Kozlovs

looks into the issues that have to be addressed

with ambition and courage by policy makers.

Mihails Kozlovs, ECA Member

Setting the scene for the future EU budget decisions

EU at crossroads

The European Union (EU) is at crossroads, yet again. Various crises have been following one

another. The number of challenges and priorities increase. The EU is not always ready and

able to provide immediate and adequate solutions, for which it often gets heavily criticised.

However, we should ask ourselves whether in the current globalised and highly competitive

world there are any serious alternatives to pursuing and strengthening the European

project. In fact, the choice of sustainable alternatives spanning the long term is very poor, if

not non-existent. The strength of the EU lies in its internal harmony and unity vis-à-vis the

external world.

The recent polls suggest that citizens support the EU project, but (too) many of them also

would not mind holding a referendum on whether their Member States should stay in

the EU. One way to interpret this somewhat paradoxical data is to suggest that citizens

appreciate the strong need for united Europe but they are not satisied with how the EU

project is being managed. They rightly expect action.

Compromises relecting EU evolution

Although the EU budget is only a small part of the whole EU’s universe and many of

EU laws and principles have no direct bearing on EU budget expenditures - it plays an

increasingly important role and often causes great tensions among the EU Member States

and institutions. It is clear that the new inancial framework should be capable of addressing

the current challenges and providing a solid base at least for the medium term. Many would

agree that this is not the case now. For example, A. Sapir noted already in 2003 that 'the EU

budget is a historical relic. Expenditures, revenues and procedures are all inconsistent with

the present and future state of EU integration'.

The EU inancial framework is a complex system, based on many (historical and political)

compromises, that in a way relects the evolution of the EU, both in terms of membership

and in terms of competences. More than 70 % of the EU budget is pre-allocated to priorities

that do not necessarily relect, in form or in substance, the current and future challenges.

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Future EU budget decision-making enters the crucial stage

continued

Redeployment capacity is low. The budget is more reactive than proactive and, by the time

when all requirements for disbursing are fulilled by the management bodies and recipients,

the priorities might have become outdated. Often the emerging needs deine the budget,

not (yet) a clear strategy. The length of the multiannual budget determines the need to spend

on a certain program (i.e. spend it or lose it), not the program’s efectiveness or comparative

advantage. EU budget arrangements have become more complex. Although increasing

complexity of the funding arrangements should not be considered a problem

per se,

it is a

source of concern when accountability and transparency are put at risk.

There were serious attempts to address these problems, at least to some extent, by redeining

/refocusing the objectives via the Lisbon strategy, the EU2020 initiative, identiication

of the 10 Commission priorities or by re-orientating/re-packaging the spending to new

imminent needs like environment, climate, migration, and gender. Extended use of inancial

instruments is in its pilot stage with the objective to do more with less in times of scarce

public resources. Simpliication and performance orientation also mitigate the rigidities and

ineiciencies of the EU budgetary system.

However, the citizens expect more from the EU. 'Money is a guarantee that we may have what

we want in the future. Though we need nothing at the moment it insures the possibility of

satisfying a new desire when it arises' – said Aristotle.

Even putting aside a fully legitimate question about the size of the EU budget, as it now

operates close to spending limits, it would be imprudent to continue business as usual when

designing and negotiating the post 2020 EU budget. Albert Einstein once remarked that

‘insanity’ is ‘doing the same thing over and over again and expecting diferent results'.

The unfortunate process of Brexit gives an opportunity (or determines the necessity?) to

review the fundamentals and principles of the EU budget. A chance to ask open questions

like:

what should be inanced at the EU level?

How did the existing policies perform over time and do they (still) bring EU added value?

What kind of spending instruments are more suited to what circumstances and how to

distribute the resources?

What conditions should be attached to the EU spending and, even, what should be the

size of the EU budget?

Indeed, the question of the past vs the future, e.g. whether after many years of rapid

institutional and policy development and enlargements in the EU, it is acceptable that the

budget fundamentals/principles essentially stay the same? This is a valid question more than

ever. Undoubtedly, this debate should go in parallel with the wider deliberations on the

future of the EU

ECA’s contribution to the debate

ECA brieing paper on the MFF mid-term review

In its brieing paper (October 2016) on the mid-term review of the Multiannual Financial

Framework (MFF)

the ECA responded to the Commission’s proposal for the mid-term

1 European Commission’s White paper on the Future of Europe: relections and scenarios for 27 by 2025; published

01.03.2017.

2 Brieing paper on the mid-term review of the Multiannual Financial Framework (MFF) 2014-2020 “EU budget:

time to reform?”; published 28.10.2016.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Future EU budget decision-making enters the crucial stage

continued

review of the EU inancial framework. Importantly, we went further by calling upon the EU

institutions, Member States and other stakeholders to launch as soon as possible a relection

on the extent to which the diferent EU policies should be inanced from the EU budget. We

also proposed to carry out a spending review assessing the extent to which the allocation of

resources in the EU budget relects the EU strategic priorities and opportunities to add value.

The review would bring about a clear(er) picture of whether the existing policies achieved

objectives and if they still have or they will have European added value in the modern Union,

There might well be a case for lifting some Member States’ level priorities to the EU level and

lowering some of the current EU level priorities to the Member States’ level. The relection

process has been ongoing, and the ECA has already become a partner in this exercise.

On 28 June 2017, the European Commission published its relection paper on the Future

of EU inances. Several dedicated events have been organised by the Commission and the

European Parliament where I had a privilege to represent the ECA. On 13 September 2017,

Commission President Junker gave his State of the Union speech where the EU budget

featured prominently. On 25 September 2017, the Commission organised a conference

on “The Future of EU Finances”, and featured ECA President Klaus-Heiner Lehne as a

guest speaker. Our stakeholders recognise our contribution to the debate and value our

knowledge and experience. It also proves that the timing of ECA products is crucial if we aim

to be relevant.

The political process towards the next MFF involves the European Council orientations,

hopefully, in mid-December this year. The Heads of EU states and governments should strive

to identify the path for Europe in the years to come. They also should provide guidance on

the EU public goods/ European added value and (ideally) ind consensus on a set of policies

to be inanced from the EU budget. For example, a lot is being said about the need for more

EU involvement in security, defence, cybersecurity and migration, but there is still little

clarity on how deep the EU involvement and therefore the EU budget contribution for these

policy areas should be. Input on these issues is needed by the Commission before it submits

the new MFF proposal. Importantly, this debate should be open and frank without quick

‘back-of-the-envelope’ calculations of

juste retour.

Input from the ECA Annual Report 2016 and beyond

The Commission’s legal proposals for the next MFF are expected in May 2018. The ECA will

continue to play a role in the debate with our Annual report 2016 (AR 2016) and its Chapter

2 ’Budgetary and inancial management.’ Many of the issues considered in this chapter have

a bearing on future EU budgets. Next year the ECA will also publish a brieing paper on the

future of the EU budget under the leadership of my colleague Jan Gregor. Many relevant

special reports have been included in our recently published Annual Work Programme 2018.

These ECA products should make criteria like economy, eiciency and efectiveness more

prominent in the policy debate on the next multiannual inancial framework.

Main take-aways from the debates so far

Timing and lexibility

Timing is an important feature of good budgetary management. From this perspective it

is certainly welcome that there is at least a declared shared ambition to agree upon the

upcoming Commission’s proposal for the new MFF within the current legislative term. The

beneits of moving faster than in the past after the Commission will have submitted the

proposal, are evident - the time gap between decision on the spending priorities for years

to come and the start of real spending on the ground needs to be shorter. Assessment

of spending would also be facilitated as currently it is diicult to appraise the design,

operation and results of the 'old' programmes before the 'new' ones are adopted and

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Future EU budget decision-making enters the crucial stage

continued

being implemented. Earlier decision-making would also allow better preparing for the new

programming period and avoiding signiicant delays in implementation.

A later presentation of the Commission’s `proposal (May 2018 vs December 2017) gives

some more time to asses spending under the current MFF 2014-2020 and allows seeing how

it matches the updated EU priorities or where it brings the most added value. Clear strategic

vision is key to be successful in achieving eiciency of the EU budget in the future. Currently,

MFF 2014-2020 (technically) relects the EU priorities at the time of adoption (in 2013), EU

2020 and the Commission’s 10 priorities represent the medium term strategic objectives.

As our President underlined during the Conference on 25 September, the EU budget

needs more lexibility and transparency. Pre-allocation (of more than 70% of the budget)

surely creates a certain level of predictability but at the same time limits lexibility to make

adjustments throughout the seven year MFF. Not only does it limit the ability of the EU to

respond to (often urgent) evolving needs. It can also potentially have negative efects on

performance through less competition, reliance on ’envelopes’ and duration of the programs

based on length of the planning period rather than on policy needs. Numerous special

instruments and margins provide some lexibility, but they can be exhausted already by the

middle of a seven year inancing period.

New mechanisms to extend funding

The EU budget has evolved greatly over the years. A number of new mechanisms for funding

EU policies have been added, including outside the EU budget. As a result the EU inancing

system now represents a complex web of arrangements where it may prove to be too

diicult to ensure proper accountability and transparency to EU’s citizens. Already it is clear

that our citizens do not really see the link between the EU level policies that are inanced

from the EU budget and beneits they bring to each and every individual. This link, however,

needs to be clearly visible to ‘legitimise’ the EU level spending and regain citizens’ support

for the European project.

We touched upon the issue of complexity of the EU’s budgetary system in our brieing paper,

and continued the theme in our recent annual report. Unlike the European Parliament that

legitimately approached the issues of complexity from the inancial architecture point of

view, we assumed that the structure of the budget is in essence a political decision. But

the ECA emphasised that whatever the inancial architecture chosen, accountability and

transparency should be upheld.

It is important to keep in mind that with the introduction of new diferent funding

mechanisms the inancial exposure of the EU budget is also growing. These are our

borrowing and lending activities, guarantees and long term obligations - possible EU

payments that may occur in the future and that need to be closely monitored.

Financial instruments (FI) beneiting from the EU budget support have been increasing -

more than tripling in 2014-2020, if compared to the previous programming period. They are

probably a great example of how to do more with less, which is a much needed endeavour,

especially if one assumes that the EU budget will not change in terms of size. Supposedly

they will feature very prominently in the next multiannual budget. But there are caveats

that should be considered and addressed. Most notably risk sharing arrangements among

the EU budget, intermediaries and inal beneiciaries need to be balanced. Also, as we noted

in our special report 19/16 on Financial Instruments in 2016, many of them had diiculties

attracting private capital and controlling costs, and sometimes the resources were just

'parked' to inlate the Member State’s absorption numbers or avoid de-commitments.

The quantity of FIs and their governance arrangements should be carefully analysed. It

remains to be seen if with the amended legal base for the current programming period

these problems will be addressed and to what extent.

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Future EU budget decision-making enters the crucial stage

continued

A good case study is provided for in our upcoming special report on the SME Guarantee

Facility. This facility has similar objectives to FIs under the shared management but it

operates diferently (under the management of the European Investment Fund). It will be

very interesting to compare various inancial instruments. In general, with limited resources

it is very important that we compare the programs and, if needed, discontinue or adjust the

ones which are performing worse.

European fund for strategic investment (EFSI) – a major new FI - will continue to grow. The

EFSI governance structure is diferent from that of the other FIs under shared and central

management, because more implementation powers are delegated to the conduit of the EU

guarantee – the European Investment Bank. This means that public scrutiny for the EFSI may

be more limited than for other instruments supported by the EU budget. It is too early at

the moment to judge the efectiveness of this instrument in terms of illing the investment

gap in the EU and its wider objectives of stimulating growth and jobs. However, in its special

report the ECA will look whether EFSI in its current design is the optimal EU instrument

to attract private capital, fund riskier and additional projects and collaborate with private

investors. Given the growing signiicance of these kind of centralised and innovative

instruments for the future EU budget, it is important to get it right from the start.

Future of major ‘traditional’ policy areas

Major spending categories in the EU budget, like the Common Agricultural Policy (CAP) and

Cohesion policy, have been at the spotlight at many recent discussions. As regards Cohesion

policy, in the EU regions that beneited a lot from the Cohesion support there are no doubts

that this policy -albeit somewhat streamlined- should remain important in the EU spending

also post 2020. Some Member States and regions search for more European added value in

cohesion spending and some will continue to prioritise their net balances

The ECA’s recent audits on performance in Cohesion spending suggest several promising

avenues. Some examples of these avenues are:

•

Setting realistic and achievable objectives and targets for what can be achieved with

EU funding alone;

Having a comprehensive view of the total cost of a programme/policy at EU and

Member States level when making a proposal;

A move to a more results-based approach in allocating funds;

Continued use of (considerably strengthened ‘conditionalities’ and better links to the

European Semester.

What is being also underlined, and I fully subscribe to that, is that the Cohesion inancing as

a rule should not replace national public investment. The decision makers will have to look

carefully at the substitution efect because it is not just about converging, e.g. removing

economic, social and territorial disparities across the EU. It is also about doing it right for

the sake of sustainability of investments and changes made, reforms carried out and about

avoiding future dependency on this inancing.

Another relevant issue is the cyclical nature of EU structural funding. We drew our

stakeholders’ attention to this in our brieing paper on the mid-term review of the MFF

2014-2020 and also in chapter 2 of our 2016 Annual Report. Size and timing of the receipts

from the EU budget can have signiicant macro-economic efects such as on investment,

growth, and jobs. Therefore size and timing of these receipts need to be suiciently taken

3 Many say the concept of net balances is outdated and, while I tend to agree, it is clear that it is still a guiding

principle in the budgetary negotiations in the EU.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Future EU budget decision-making enters the crucial stage

continued

into account when planning future EU budget expenditure to avoid abrupt withdrawal of

funding. Absorption diiculties is another problem we have spotted in our work that needs

to be addressed.

The CAP is an area of extreme political sensitivity and, probably, the most supported policy

in all Member States. Already a long time ago there were calls for reform. The ECA produced

important contributions on various aspects of the CAP and its implementation. I am looking

forward to the forthcoming brieing paper on the future of the CAP as is foreseen in the

ECA’s Annual Work Programme 2018.

Finally, the debate on the future of the EU budget is not a standalone item as it used to be

in the past. In search of economy, efectiveness and eiciency as well as synergy, one should

also closely follow the debate about the future of the Eurozone, the European Stability

Mechanism and economic governance including the EU Semester.

IV In conclusion

Some people might ask: ’What is the ECA role in these political deliberations?’ In my view

it is clear that, throughout the years, the ECA has accumulated a wealth of knowledge

about the EU budget and its implementation. The run-up towards the new MFF is the best

moment to engage and to share this knowledge with the budgetary authority and broader

stakeholders. Provision of objective evidence, both positive and sometimes critical, will be

our contribution to a more agile, eicient and transparent future EU budget.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Reaching out

Commission Vice-President Jyrki Katainen

visits the ECA

By Turo Hentilä, Private Oice of Ville Itäla, ECA Member

Commission Vice-President Jyrki Katainen visited the Court on 20 October.

During a working lunch he held discussions with Mr Itälä. He then gave a

presentation to Finnish staf of the Court. For this presentation, the Finnish

staf of the other EU Institutions based in Luxembourg was also invited.

After Mr Katainen’s presentation, the audience actively commented the

presentation and put forward several questions. They covered various

current EU topics, such as Commission’s latest relections on the future

of the EU, challenges and timetable for the new Multiannual Financial

Framework, communication issues towards EU citizens and Brexit

negotiations.

Ville Itäla, ECA Member and Jyrki Katainen,

Commission Vice-President

Meeting betwen staf members of EU institutions and Commission Vice-President Jyrki Katainen

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Reaching out

continued

Geert Bourgeois, Minister President of Flanders,

visits the ECA

By Gerry Madden, Private Oice of Karel Pinxten, ECA Member

Striving to better connect to its stakeholders, the ECA welcomed the

visit of a delegation from the Flanders region in Belgium, headed by

its Minister-President Geert Bourgeois. Gerry Madden updates us on

the meeting hosted by Karel Pinxten last month.

Providing background to the ECA’s work

On 18 October 2017 Geert Bourgeois was warmly received at the ECA by

Karel Pinxten, who welcomed the opportunity for an exchange of views

with the representatives of a community, which was very familiar to him.

Geert Bourgeois was accompanied by a high level delegation consisting of:

•

Koen Verlaeckt, Secretary-General at Flanders Department of Foreign

Afairs

Karel Pinxten, ECA Member and Geert

Bourgeois, Minister-President of Flanders

Julie Bynens, General Representative of the Government of Flanders to the EU

Hendrik Theunissen, Deputy Head of Cabinet of the Minister-President

In addition to Karel Pinxten, the ECA was represented by Gerhard Ross, Director of Chamber II, Niels Brokopp,

Principal Manager, and myself.

Karel Pinxten gave a comprehensive description of the ECA’s organisation and work. He explained the

Chamber system and how this had made decision making more streamlined. As the delegation had

requested, he referred to the development of the Statement of Assurance (SoA) and to the 2016 SoA in

particular. This represented, in his view, a signiicant departure from prior years as the opinion on “legality

and regularity” was qualiied rather than adverse. He stressed the nature of our auditsand explained that

we go “on the spot” to see for ourselves how the EU money is being spent. While the SoA audit is a global

exercise as we audit how the entire EU budget is collected and spent, we also make certain references

to countries in our report. Karel Pinxten cited the control weaknesses in Belgium, relating to the lack of

thorough post clearance checks, as an example). Regarding performance audits, Karel Pinxten set out the

criteria used for choosing the topics to be examined. He emphasised the signiicance of the “value added”

consideration and the importance of the appropriate timing of our reports.

Opportunities and diiculties in the Cohesion area

As the visiting party had expressed a particular interest in the audit of Cohesion Funds, Karel Pinxten gave

the loor to Messrs Ross and Brokopp for their presentation. They explained in detail the workings of the

Cohesion Fund. Gerhard Ross dealt with the issues of simpliication and diferentiation as they operate for the

Fund and outlined the present challenges, together with those likely to arise in future years. Niels Brokopp

explained “Single Audit” and the associated opportunities and diiculties.

A lively question and answer session took place towards the end of the meeting. In reply to a question

from Bourgeois, Gerhard Ross explained that the value added of Cohesion Funds was a key concern. When

discussing the issue of simpliication Niels Brokopp indicated that some countries/regions made life diicult

for themselves by adding additional layers of requirements.

At the end of the meeting Geert Bourgeois expressed his great appreciation for the presentations which he

found most interesting and informative. He thanked Pinxten for organising the meeting and welcomed his

invitation to return to the ECA in the near future.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Reaching out

continued

Representatives of the Managing Authority for

the cross-border programme IPA ADRIATIC visit

the ECA

By Chiara Cipriani and Benjamin Jakob, Private Oice of Pietro Russo,

ECA Member

Also outside the EU cross border cooperation is stimulated with EU

funds. Chiari Cipriani and Benjamin Jakob share the highlights of

a visit of the Managing Authority called ‘IPA Adriatic’, an important

player for such cooperation in the Adriatic region.

IPA ADRIATIC CBC programme covering 890 beneiciaries in over

80 projects

The Managing Authority for the cross-border programme ’IPA Adriatic’,

represented by Paola Di Salvatore and her team, have visited Luxembourg

on 18 October 2017 to meet with the ECA and the European Court of

Justice (CJEU). The aim of their visit to the ECA was to expound the status

of implementation of the programme IPA Adriatic CBC and the legal,

administrative and inancial issues that have been identiied in the eight

countries participating in the programme (Albania, Bosnia-Herzegovina,

Croatia, Greece, Italy, Montenegro, Slovenia and Serbia, four of which in

pre-accession), and particularly the delicate relationship between the

European standards already internalized and applied by EU Member

States and the existing legislation in four pre-accession candidate

countries which do not recognise EU Law as a legal basis.

The IPA Adriatic CBC programme was the irst programme of European

territorial cooperation to hold a technical meeting with the ECA. The

Managing Authority presented the IPA Adriatic CBC programme’s

objectives and provided a detailed analysis of the critical points in the

complex implementation of the programme, which covers more than

890 beneiciaries in over 80 projects with a budget of around 245 million

EUR. The visitors from IPA Adriatic were welcomed by Pietro Russo, ECA

Member, and technical matters were discussed with ECA colleagues Pietro

Puricella, Alberto Gasperoni, Enrico Grassi, and Nicola Berloco.

Pietro Russo expressed his appreciation for the work carried out by the

Managing Authority. He pointed out that, especially when it comes to

young and fragile democracies, the role of the management and control

systems of EU funds does not only concern technical accounting aspects

as a result of work, but also to the correct use of the resources that come

from the taxes paid by European citizens. Another important element

in the meeting was the discussion of the results of Special Report 21/16

on the Western Balkans, which focuses on the implementation of the

principles of the rule of law and administrative capacity, as well as the

ight against corruption and organised crime. The delegation of IPA

Adriatic perceived the indings and recommendations in this report as

highly relevant in the framework of eight Member States participating in

the IPA Adriatic CBC Programme.

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Reaching out

continued

Meetings at the CJEU

During the subsequent meeting at the CJEU, Advocate-General Paolo Mengozzi stressed the

importance of the homogeneous interpretation of EU law by the CJEU. This as a guarantee of

democracy and legal certainty also for pre-accession candidate-countries, given the fact that

the use of EU funds requires the application of EU law and the principles of protection of the EU

budget. Similarly Ezio Perillo, Judge of the General Court of the CJEU, addressed the eforts made

in the management of IPA Adriatic and stressed the risk of losing sight of the objectives of primary

importance in the framework of European territorial cooperation.

’The opportunity was very impressive’ Paola Di Salvatore stated after the meetings two meetings.

’We were able to explain the role that the IPA Adriatic Programme has been playing since 2013,

in a framework of institutional cooperation, to tackle the key issues related to the proper use of

European funds, and the necessary legislative and administrative harmonisation between Member

States and pre-accession candidate-countries, whilst protecting the EU budget as a core principle of

Territorial Cohesion Policy.’

Meeting with the IPA Adriatic Managing Authority

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

Reaching out

continued

Representatives of the Czech Ministry of Finance visit the ECA

By Werner Vlasselaer, Private Oice of Jan Gregor, ECA Member

Getting into audit speciics: Werner Vlasselaer gives an update on recent exchanges

with the Czech Ministry of Finance.

Meeting with representatives of

the Czech Ministry of Finance

Paying agency responsabilities

On 23 and 24 October 2017, Jan Gregor, ECA Member, welcomed a delegation from the

Ministry of Finance of the Czech Republic. The delegation comprised members of the National

Fund Department and Audit Authority. The National Funds department administers and

manages cash lows from the EU and abroad provided to the Czech Republic by European

structural and investment (ESI) funds, pre-accession instruments and other instruments. It

serves as the Paying and Certifying Authority for ESI Funds and European Economic Area. It acts

as the competent body responsible for the accreditation of the paying agency designated to

implement measures of the common agricultural policy and for designating the certiication

body for the certiication of the paying agency’s accounts. The Audit Authority department

is the auditor for EU funds provided to the Czech Republic under the Structural Funds, the

Cohesion, and the European Fisheries Funds.

ECA providing updates on performance and compliance audit developments

The program of the visit was tailored to the interest to both departments - ECA reporting on

performance and future development of Statement Assurance approach. Presentations were

provided by Marius Pomienski, director of Chamber V assisted by Tomasz Kokot and by auditors

of Chamber I (Jindřich

Doležal, Jan Kubát and Tomáš Krajtl) and Chamber II (Jiří Beneš, Milan

Šmíd, Dana Šmíd Folt�½nová and Radka Papoušková).

The presentations were followed by lively

exchanges of views in an open atmosphere with questions and insights exchanged.

When concluding the meeting on 24 October Jan Gregor underlined that hopefully the

discussions held would help in identifying new areas of cooperation and contribute to

successful implementation of the two key pillars of 2018-2020 ECA Strategy - Improve the

added value of the Statement of Assurance in the context of today’s EU inancial management

and Increased focus on the performance aspects of EU action.

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

FOCUS

Publications in the previous month

Special report

N° 13/2017

A single European rail traic management system: will the

political choice ever become reality?

We assessed whether the European Rail Traic Management System (ERTMS) has been

properly planned, deployed and managed. ERTMS is designed to replace the diverse

railway signaling systems around Europe with a single system that enables trains to

travel uninterrupted across diferent countries and facilitates rail competitiveness. We

found that deployment so far is at a low level and represents a patchwork, despite the

fact that the ERTMS concept to enhance interoperability is not generally questioned by

the rail sector. Infrastructure managers and railway undertakings are reluctant to invest

due to the expenses entailed and the lack of an individual business case (for example

in the Member States with well performing national systems and signiicant remaining

lifetime). EU funding can only cover a limited amount of the investments. We make a

number of recommendations to the European Commission, the Member States and the

European Union Agency for Railways to help improve the deployment and inancing of

the system.

Click here for our full Special Report

Published on

3 October 2017

Work Programme

2018 Work Programme

Our work programme for 2018 covers a broad range of issues, relecting the challenges

the EU is currently facing. It addresses key concerns such as the sustainable use of

natural resources, growth and inclusion, migration and global development, the single

market, and an accountable and eicient European Union.

Published on

18 October 2017

Click here for our work programme

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

FOCUS

Publications in the previous month

Audit Brief

EU Auditors publish brieing on Commission’s

fraud controls

The European Court of Auditors is currently conducting an audit of how the

Commission manages the risk of fraud in EU spending. The audit will focus on fraud

prevention and fraud response and will include contributions from NGOs, academics

and prosecutors, as well as Europol and Eurojust.

In a 2015 Eurobarometer survey of perceptions of fraud and corruption afecting the EU

budget, 71% of respondents thought that fraud occurred “rather frequently” and 60%

felt that “corruption is signiicant in the EU institutions”. This represents a signiicant

increase compared with the 2008 lash Eurobarometer, when 54% thought fraud

happened rather frequently and 44% felt that corruption occurred in EU institutions.

Fraud is diicult to measure. It can only be established through a criminal court

procedure. In 2016, the total value of fraud detected within the EU Budget was an

estimated €391 million, according to igures drawn from the European Commission, the

Member States and the candidate countries. However, due to several factors in the way

the igures are collected and reported, this estimate may be too low.

Click here for our Audit brief

Published on

19 October 2017

Audit Brief

The European Fund for Strategic Investments

(EFSI)

The European Court of Auditors is currently examining whether the European Fund for

Strategic Investments (EFSI) is on-track to reach its policy objective of supporting

additional investment in Europe.

The Investment Plan for Europe (IPE), the irst major initiative of the Juncker

Commission, was announced in November 2014. In 2015 the European Fund for

Strategic Investments (EFSI), the core pillar of the IPE, was set up jointly by the European

Commission and the EIB Group (the European Investment Bank and the European

Investment Fund) with the aim of mobilising up to 315 billion euro of additional

investments between 2015 and 2018 and to increase access to inance for SMEs and

mid-cap companies.

The audit aims to assess whether EFSI is efective in addressing the need to support

investment in the EU. In particular, we will examine whether Commission decision-

making was based on a clear rationale and sound evidence when designing the support

provided under EFSI and the role of national promotional banks and institutions in

allocating the inancial support from the EIB Group. Our audit also seeks to assess the

additionality and added value of EFSI operations.

Click here for our Audit brief

Published on

26 October 2017

EUU, Alm.del - 2017-18 - Bilag 112: Rapport fra den Europæiske Revisionsret november 2017

ISSN 1831-449X

EDITION HIGHLIGHTS

ECA: CATALYST FOR GOOD MANAGEMENT

AND TRANSPARENCY

Looking back at the oicial anniversary

ceremony

CAN SAIS CONTRIBUTE TO RESTORING THE

TRUST OF EU CITIZENS?

Annual meeting Contact Committee of EU SAIs

FOLLOW-UP OF AUDIT RECOMMENDATIONS:

THE ECA EXPERIENCE

FUTURE EU BUDGET DECISION-MAKING

ENTERS THE CRUCIAL STAGE

Cover:

ECA 40 years anniversary ceremony

From left to right: Henri Grethen, ECA Member; Xavier Bettel, rime Minister of Luxembourg; Kersti Kaljulaid,

President of Estonia; Klaus-Heiner Lehne, ECA President; their Royal Highnesses, the Grand Duchess and

Duke of Luxembourg; Antonio Tajani, President of the European Parliament; Jean-Claude Juncker,

President of the European Commission; Karel Pinxten, ECA Member

QJ-AD-17-010-2A-N