Aigner, H.

Name not available

10May1976 ' \ \ ..... /, :). ·' English Edition European Con1munities </3;}., I/ EUilOPEAN PARLIA~'1ENT Working D0cu1nents 1976 - l 977 DOCUI\IENT 98/76 I~eport drawn up on behalf of the Committee on Budgets on the firsyi rcqncsts to carry forward appropriations from the finandal year 1975 io the financial year 1976 (appropriations not carried forward automatically) (Doc. 47/76) Rapporteur: Mr H. AIGNER ,, PE 44.329 By letter of 5 April 1976, the President of the Council of the European Communities requested the European Parliament, pursuant to Article 6(2) of the Financial Regulation, to deliver an opinion on the proposal from the Commission of the European Communities to the Council on the non-automatic carrying forward of appropriations from the financial year 1975 to the finan-cial year 1976. On 7 April 1976, the President of the European Parliament referred this proposal to the Committee on Budgets. On 29 April 1976, the Committee on Budgets confirmed the mandate of Mr Aigner as rapporteur. At the same meeting, the committee considered this proposal and unani-mously adopted the motion for a resolution and the explanatory statement. Present: Mr Lange, chairmani Mr Aigner, first vice-chairman and rappor-teur; Mr Artzinger, Lord Bruce of Donington, Mr Brugger, Mr Dalyell, Mr Fletcher, Mr McDonald (deputizing for Mr Galli), Mr Notenboom, Mr Radoux, Mr Shaw and Mr Suck (deputizing for Mr Hansen). - 3 - PE 44.329/fin. C O N T E N T S A. MOTION FOR A RESOLUTION • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 5 B. EXPLANATORY STATEMENT • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 6 - 4 - PE 44.329/fin. A The Committee on Budgets hereby submits to the European Parliament the following motion for a resolution, together with explanatory statement: MOTION FOR A RESOLUTION on the first list of requests to carry forward appropriations from the financial year 1975 to the financial year 1976 (appropriations not car-ried forward automatically) The European Parliament - having regard to the list submitted by the Commission of the European Communities to the Council (COM(76) 128); - having been consulted by the Council, pursuant to Article 6(2) of the Financial Regulation1 of the Communities (Doc. 47 /76); - having regard to the Report of the Committee on Budgets (Doc. 98 /76); 1. Reiterates its view that carry forwards should not be of such an order of magnitude as to have the effect of seriously disturbing the annual budget; 2. Recalls its earlier expression of concern as to the possible danger which the abuse of the carry forward procedure could pose for Parlia-2 ment's r6le in the budgetary sphere 3. Approves the carrying forward of -(a) 20,000 u.a. in accordance with Article 6(1) (b) of the Financial Regulation in respect of Annex I - Economic and Social Committee -of the Council's section of the budget; (b) 124,303,459.31 u.a. in accordance with Article 6(1) (b) of the Financial Regulation in respect of the Commission's section of the budget; and (c) 71,227,243.06 u.a. in accordance with Article 6(5), second paragraph, of the Financial Regulation, also in respect of the Commission's section of the budget. l OJ No. L 116, 1.5.1973 2 OJ No. C 157, p. 95, 14.7.75. - 5 - PE 44.329/fin. X B EXPLANATORY STATEMENT 1. Article 6 of the Financial Regulation1 provides that (a) appro-priations which are still unused at end-December, and (b) appropriations for payments still outstanding as at end-December for commitments entered into after 15 December, and which relate to the supply of goods and services2, may be carried forward to the next financial year. Paragraph 2 of this article requires the Commission to subnit to the Council the requests to carry forward such appropriations before 1 May. Unless the Council, acting by a qualified majority, after consulting Parliament takes a contrary decision within a month, the carry forward of the appro-priations in question is deemed to be accepted. The carry· forward arrangement applies to the appropriations of each of the Institutions - Parliament, Council, Court of Justice and the Commission but major amounts are likely to be involved only in the case of the Commission. Appropriations relating to remuneration and allowances of Members of the Institutions and of personnel may not be carried forward. 2. Parliament now has before it, for its opinion, a first list (COM(76) 128) of requests for the carry forward of appropriations from financial year 1975 .to financial year 1976: it is the intention of the Commission to transmit shortly a second list setting out details of further requests for carry forwards. COM(76) 128 relates to two different sections of the budget,that for the Economic and Social Committee and the Commission's section. 3. The request in respect of the Economic and Social Committee is for the carry forwards of 20,000 units of account under Item 2200 in respect of initial equipment. The following table sets out the position under this item in regard to expenditure for 1973 and 1974, together with the provisions in the 1975 and 1976 budgets: l OJ No. L 116, 1.5.1973 2 These carry forwards are usually referred to as non-automatic carry-forwards to distinguish them from appropriations which may be carried forward automatically by virtue of commitments entered into between 1 January and 31 December (with the exception of commitments entered into after 15 December). - 6 - PE 44.329 /fin. Economic and Social Committee Item 2200 (Initial Equipment) Expenditure 1973 II 1974 Appropriations 1975 II 1976 ~-21,819.88 10,953.64 6,000.00 3,000.00 4. Thus,the provision in the 1975 budget at Item 2200 was for an amount of 6,000 u.a. and the remarks column indicated that this sum was intended to cover the cost of purchasing a calculator and other office equipment. As well, Article 220 included provisions totalling 36,400 u.a. for the renewal and hire of office machinery. 5. The 1976 budget provision of 3,000 u.a. at Item 2200 was explained in the remarks column as being intended for the purchase of calculating machines and a document shredder. By virtue of transfers within Chapter 22, in accordance with Article 21 of the Financial Regulation, the level of appropriations at Item 2200 was raised to the level of 20,000 u.a. 6. Having fully considered the circumstances and having taken account of the additional information furnished by the Economic and Social Com-mittee, the Committee on Budgets gave a favourable opinion on the use of the carry forwards procedure in this case. 7. The section of the carry forwards request dealing with the Commis-sion's part of the budget relates to two separate matters: (a) Community projects in the hydrocarbons sector: and (b) EAGGF Guidance sector. - 7 - PE 44 .3291fin. 8. In regard to (a), the position is as follows: The provision for this head in the 1975 budget was 25,000,000 u.a. of this, 13,914,816 u.a. was committed in the course of 1975, leaving a balance of 11,085,184 u.a. unutilized. For 1976, the Commission inserted a sum of 40,000,000 u.a. in the preliminary draft budget: however, the Council cut this back to 25,000,000 u.a. - or no increase over the 1975 level. Non-compulsory expenditure was involved and Parliament adopted an amendment increasing the appropriations by 3 mu.a. 9. The request for carry forwards in this case must be viewed against the background of (a) the key Community importance attaching to energy resources generally and, in particular, to the promotion of certain pro-jects in the field of hydrocarbon prospecting and (b) the large number of proposals put forward for consideration in the context of Regulation (EEC) No. 3056/73. 10. Last year, the Commission received 120 proposals for consideration for support in this domain: of these, 86 were examined1; total invest-ment and expenditure involved: 247,267,989 u.a. Of these, the Commission re-commended for support 38 proposals involving investment of 117,852,142 u.a. - Community aid to amount to 44,683,758 u.a. (COM(75) 424 final). iParliament was not consulted in regard to these proposal~ 11. The Commission now indicate that they are about to submit to the Council an amended proposal which reduces the number of projects recom-mended from 38 to 26 and the total aid proposed from 44,683,758 u.a. to 38,448,635 u.a.: the reduced figure would be within the 1976 budget provision plus the maximum amount of non-automatic carry forwards from 19752 • The Committee on Budgets regrets that it should be necessary for the Commission to reject, at this stage, approximately one-third of the proposals which, following careful scrutiny, it had recommended for support last July. In all the circumstances, the approval of these carry forwards is considered desirable and necessary. 12. The Commission's requests in regard to appropriations in the sphere of agriculture fall into two parts: (a) that which deals with 'normal' non-automatic carry forwards LArticle 6(1) (bl7of the Financial Regulation (appropriations still unused at end of December): and 1 The balance were either withdrawn or amalgamated. 2 28,000,000 u.a. plus 11,085,183.92 u.a. = 39,085,183.92 u.a. - .8 - PE 44.329 /fin. (b) that which deals with carry forwards under Article 6(5) of the Financial Regulation (EAGGF payments due in respect of conuni tments entered into earlier),, and which may be carried forward automatically for a period of five years; after the five years have expired, the Commission is required to submit to the Council before 1 May, the list of appropriations still conunitted which have to be carried forward. On the agricultural side the non-automatic carry forwards lArticle 6(1) (bL/ for which approval is sought, amount to 113,218,275.39 u.a.; automatic carry forwards iArticle 6(1) (cl/ amount to 110,591,695.52 u.a.; non-automatic carry forwards lArticle 6(517 for which approval is sought amount to 71,227,243.06 u.a.; automatic carry forwards lArticle 6(5L/ amount to 659,547,170.04 u.a. 13. The Conunittee on Budgets considered the explanations furnished in regard to these carry forwards and noted with regret that administrative delay in Member States had contributed substantially to their arising. In view of the considerable importance attaching to the availability of adequate resources for the Guidance sector, the Committee gave a favourable opinion on the requests. The Conunittee will, however, con-sider the question of carry forwards generally again when the second list of requests is presented in the course of the next few weeks and also when the amendments to the Financial Regulation come before it. - 9 - PE 44.329/ fin. 

Report
drawn up on behalf of the Committee on Budgets
on the first list of requests to carry forward appropriations from the financial year
1975 to the financial year 1976 (appropriations not carried forward
automatically) (Doc. 47/76). EP Working Documents 1976-77, document 98/76, 10 May 1976

Archive of European Integration

r·~ I I 6 July 1976 English Edition European Communities (.13"2. I I EUROPEAN PARLIAMENT Working Documents 1976 - 1977 DOC{JMENT 218/76 Report drawn up on behalf of the Committee on Budgets on the/second list of requests to carry forward appropriations from the financial year 1975 to the financial year 1976 (appropriations not carried forward automatically) (Doc. 159/76) Rapporteur: Mr H. AIGNER PE 44.890/fin. ,, ; ' , By letter of 3 June 1976 the President of the Council c£ the European Communities requested the European Parliament, pursuant to Article 6(2) of the Financial Regulation to deliver an opinion on the proposal from the Conunission of the European communities to the Council concerning the non-automatic carry forward of appropriations from the financial year 1975 to the financial year 1976. On 14 June 1976 the President of the European Parliament referred this proposal to the Committee on Budgets. On 5 July 1976 the Committee on Budgets confirmed its appointment of Mr Aigner as rapporteur. At the same meeting the committee examined this proposal and unanimously adopted it together with the explanatory statement. Present: Mr Lange, chairman and acting rapporteur; Mr Artzinger, Lord Bruce of Donington, Mr Cointat, Mr Dalye11, Mr Fletcher, Mr Lautenschlager, Mr Memmel (deputizing for Mr FrUh), Mr Notenboom, Mr Patijn, Mr Radoux, Mr Shaw, Mr Suck, Mr Terrenoire, Mr van der Mei (deputizing for Mr Galli), Mr Vandewiele (deputizing for Mr Mursch). - 3 - PE 44.890/fin. A. MOTION FOR A RESOLUTION B. EXPLANATORY STATEMENT CONTENTS - 4 -5 7 PE 44.890/fin r ... . , A The Committee on Budgets hereby submits to the European Parliament the following motion for a resolution, together with explanatory statement: MOTION FOR A RESOLUTION on the second list of requests to carry forward appropriations from the financial year 1975 to the financial year 1976 (appropriations not carried forward automatically) The European Parliament, - having regard to the list submitted by the Commission of the European communities to the council (CCM(76) 258), - having been consulted by the council pursuant to Article 6(2) of the Financial Regulation1 of the European Communities (Doc. 159/76), - having regard to the report of the Committee on Budgets (Doc. 218/76 ) , · 1. Reiterates the view it expressed in resolutions on this matter in 2 previous years and in the resolution on the first list of requests for the non-automatic carrying forward of appropriations to the finan-3 cial year 1976, namely _that, while such requests may be a necessary part of flexible financial management, they should nevertheless be of an exceptional character1 2. Recalls its earlier expression of concern as regards the possible danger which the abuse of the carry-forward procedure could pose for 4 Parliament's role in the budgetary sphere, 3. Draws particular attention in this connection to the following points: the carrying forward of appropriations causes an implicit accumula-tion in the following budget of expenditure residues which are not evident from the budget itself, - such a procedure impairs budgetary transparency, and - the expenditure residues not only give rise to problems of approval, but also make the auditing of accounts more difficult1 l OJ No. L 116, 1.5.1973 2 Most recently in OJ No. c 128, 9.6.1975 and OJ No. c 157, 14.7.1975 3 OJ No • 4 OJ No. C 157, 14.7.1975, P• 95 - 5 - PB 44.890 /fin. ·_.,) 4. Declares that it will make a very careful study of those aspects of the proposed new version of the Financial Regulation of 25 April 1973 relating to the introduction or a system of commitment authorizations with a view to assessing the need to continue with the system of non-automatic carry forwards: 5. Deplores the Commission's failure this year to meet the deadline laid down by Article 6(2) of the Financial Regulation: 6. Approves the non-automatic·carrying forward of appropriations pursuant to Article 6(1) (b) of the Financial Regulation amounting to: (a) 386,842 u.a. (Chapter 27 'Expenditure on Publishing and Information•, Article 2 70) in respect of the •commission I Section of the budget, (b) 2,434,288.36 u.a. (Chapter 33 'Expenditure on research and investment•, Article 330) in respect of the •conunissiort Section, (c) 8,078,079.99 u.a. (Chapter 53 •social Fund - expenditure provided· for under Article 125(1) (a) of the EEC Treaty', Article 530) in respect of the 't:ommission• Section, and (d) 5,688,606.68 u.a. (Chapter 92 'Food aid in the form of cereals', item 9201, 1975 Pr?gramme) in respect of the •commission• Section: 7. Approves, therefore, all the requests to carry forward appropriations from the financial year 1975 to the financial year 1976 (appropriations not carried forward automatically) which, together with those in the first list, which were dealt with in a separate motion for a resolution, amount to 140,891,276.34 u.a. in respect of the •commission' Section of the budget and 20,000 u.a. in respect of Annex I (Economic and Social Committee) of the •council' Section: e. Welcomes the percentage decrease - in terms of the 1976 budget as a whole - in the carrying forward of appropriations: 9. Will devote further attention to the question of carry forwards, especially those aspects relating to the control of expenditure and multi-year budgeting, in the context of its deliberations on the pro-posal for a regulation amending the Financial Regulation of 25 April 1973 applicable to the general budget of the European Communities. - 6 - PE 44.890/fin. r ' . T' B EXPLANATORY STATEMENT Procedure 1. Pursuant to Article 6(1) of the current Financial Regulation applicable to the general budget of the European Comrr~nities, the following may be carried forward to the next financial year: (a) appropriations for payments still outstanding as at 31 December for commitments entered into after 15 December in respect of thP. supply of goods and services (first alternative), (b) appropriations still unused as at 31 December (second alternative). 2. Paragraph 2 of this Article stipulates that the Colilmission shall submit requests for carry forwards before 1 May. Should the council, acting by a qualified mcljority after consulting the Parliument, fail to take a contrary decision within a month, the carrying forward of these appropriations is deemed to be accepted. 3. The same paragraph stipulates that the Commission shall also forward these requests to the European Purliament before 1 May. It is regrettable that the Commission did not fulfil its legal obligation this year until 31 May 1976, i.e. one month late. Carry forwards and commitment authorizations 4. The first alternative mentioned in paragraph 1 above is intended as a safeguard against ill-considered expenditure shortly before the end of the accounting year, i.e. against a situation where inadequate attention is paid to the justification for such expenditure and the need for economy. However, carry forwards which are easy to arrange do not in fact eliminate this type of expenditure, sometimes referred to as 'Christmas fever•. 5. The second alternative relates to appropriations still unused as at 31 December. The fact that these can be carried forward to the next financial year has already been criticized many times by the European Parliament1 • 1 Most recently in the SHAW report on the second list of requests to carry forward appropriations from the financial yearl974 to the financial year 1975 (appropriations not carried forward automatically) (Doc. 143/75 of 16.6.1975) and the COINTAT report on the Inter-institutional dialogue on certain budgetary questions (Doc. 97/76). - 7 - PE 44. 890 /fin. 6. The carry-forward system is generally justified on the grounds that the preparation of new estimates is often difficult since it is not possible, when the budget is established, to forecast accurately what appropriations will still be wholly or partially required at the end of the accounting year. If it were not possible to carry forward appropriations estimates would, ~s a precaution, be too high rather than too low to ensure that adequate funds are available. From this point of view the carry-forward solution is regarded as a prerequisite for the sparing use of appropriati9ns. 7. 1'his classic explanation is not convincing since a comparable effect can also be achieved by estimating appropriate commitment authorizations. Thus, it is clear that the need for carry-overs could be completely eliminated by introducing a system of commitment authorizations when the Financial Regulation is revised. The systematic use of commitment authorizations would make it easier to keep earmarked appropriations which have not been used at the end of an accounting year available for the expenditure specified if, during the course of the financial year, this has been lower than anticipated. 8. However, without going into details and without anticipating the opinion of the European Parliament, it should be said that, despite the general introduction-of commitment authorizations, the proposed new version of Article 6 of the future Financial Regulation still seems to permit the carrying forward of appropriations, albeit to a somewhat smaller extent. carry-forwards on the second list 10. The non-automatic carry-forwards on the second list are as follows: (a) 386,842 u.a. (Chapter 27 'Expenditure on publishing and information', Article 270) in respect of the 'Commission' Section. In the course of the implementation of the budget it became apparent that the appropriations entered under Article 270 were inadequate. Af~er transfers within Chapter 27 it became neces-sary to resort also to Chapter 99 for further appropriations. Since the necessary decision of the budgetary authority was not taken until 18 December 1975, these commitments could not be entered into the accounts until after that date, hence the request for the carrying-forward of appropriations to the financial year 1976. (b) 2,434,288.36 u.a. (Chapter 33 'Expenditure on research and investment', Article 330) in respect of the •commission' Section. - 8 - PE 44.890 /fin. t 1 T These appropriations are for payments in the financial year 1976 which would not otherwise be covered in the 1976 budget. It was not possible to use supplementary budget No. 3 for 1975 since this was not decided on until 3 December 1975. (c) 8,078,079.99 u.a. (Chapter 53 •social Fund - expenditure provided for under Article 125(1) (a) of the EEC Treaty•, Article 530) in respect of the •commission' Section. The appropriations for these measures have been cut back year by year. A further 3,160,000 u.a. was also deducted in supplementary budget No. 3, leaving an expenditure residue of 8,078,079.99 u.a., to be used essentially for one important measure. (d) 5,688,606.68 u.a. (Chapter 92 'Food aid in the form of cereals', Item 9201, 1975 programme) in respect of the 0commission• Section. Expenditure was not as rapid as expected, in particular because the Council delayed in releasing certain reserves, e.g. for the Sabel Zone. The requested carrying-forward of 5.69 mu.a., a transfer of 5.63 mu.a. from the EAGGF to Item 9200 of the 1976 budget and a transfer of 6.5 mu.a. within Item 9201 of the 1976 budget should see the 1976 programme through with 7.82 million units of account. An estimated 5 million units of account, which the Commission intends to include in the 1977 budget, will be needed to close the account in 1977. 11. The above represents a total carry-over of 16,587,817.03 u.a. in the second list. 12. The Committee on Budgets considered the requests and their justifica-tions and noted that there had been a considerable reduction in comparison with previous years and that the individual requests were esentially of an exceptional character. It was therefore able to approve the carry forwards. Total non-automatic carry-forwards for 1975-1976 13. The carry forwards in the first list, which the European Parliament 1 approved on amounted to: 1 (a) 20,000 u.a. in accordance with Article 6(1) (b) of the Financial Regulation in respect of Annex I - Economic and Social Committee - of the •council' Section of the budget (b) 124,303,459.31 u.a. in accordance with Article 6(1) (b) of the Financial Regulation in respect of the •commission' Section of the budget and AIGNER report (Doc. 98/76: Resolution of , OJ No. - 9 - PE 44.890/fin. (c) 71,227,243.06 u.a. in accordance with Article 6(5), second paragraph, of the Financial Regulation, also in respect of the 'Commission' Section of the budget. 14. This gives a total figure of 140,911,276.34 u.a. for non-automatic carry forwards from the financial year 1975 to the financial year 1976. Apart from 20,000 u.a. for the •council' Section, this sum is intended exclusively for the 'Commission' Section of the budget. 15. These carry-forwards amount to 1.9% of the total budget for 1976. This represents a considerable reduction in carry forwards: Non -automatic in million u.a. % carry forwards 1973-1974 388.3 7.6 1974-1975 601.3 10.4 1975-1976 140.9 1.9 16. The Committee on Budgets welcomes this reduction. It also hopes that with the introduction of a system of commitment authorizations in the new Financial Regulation, this type of non-automatic carrying forward will finally become a thing of the past. - 10 - PE 44. 890 /fin. T 

Report
drawn up on behalf of the Committee on Budgets
on the second list of requests to carry forward
appropriations from the financial year 1975 to
the financial year 1976 (appropriations not
carried forward automatically) (Doc. 159/76). EP Working Documents, document 218/76, 6 July 1976

http://aei.pitt.edu/96767/1/1976%2D77.76.218.pdf

Report drawn up on behalf of the Committee on Budgets on the first list of requests to carry forward appropriations from the financial year 1975 to the financial year 1976 (appropriations not carried forward automatically) (Doc. 47/76). EP Working Documents 1976-77, document 98/76, 10 May 1976

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