Committee on Budgetary Control Ordinary meeting
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CONT European Parliament
Follow its sittingsOndřej Knotek
Maybe this is not as sexy as the homework for the guys in the committee and the main committee, but it doesn't mean that this is less important. In general, we definitely welcome the proposal of the European Commission, but, of course, there are some elements where we see drawbacks or weaknesses, and we would like to strengthen those aspects, especially the aspects of geographical balance and also the technical assistance for first-time and less experienced applicants. This centrally managed approach is not very familiar to everybody. We are also missing our adequate reporting tools to prevent misuse of uMoney. Some strengthening in that regard is, of course, in place according to us.
Also, we have concerns about vaguely defined rules related to financing that is not linked to the costs. Also, we are not fully happy to see this broad discretion granted to the commission with the full flexibility of the delegated text, especially in programming and implementation. So we proposed some amendments to ensure adequate geographical balance, as well as to focus the technical assistance on less experienced entities, and at the same time, to strengthen the reporting obligations on the geographical distribution of the European competitiveness funds, enabling the scrutiny of balanced access to Union support for member states. Also, amendments to strengthen transparency, accountability, and sound financial management. Amendments to reinforce the protection of the Union's financial interests by ensuring that the competencies of OLAF, the European Court of Auditors, and the EPPO are applied extensively.
Also, amendments to make third-country counterparts subject to equivalent obligations regarding access to information and cooperation as the EU ones. And last but not least, to ensure robust justification and clear methodologies for setting milestones and targets in case of financing, not linked to cost, in order to avoid overcompensation and double funding. This is very important. And ensure effective auditability, which is consistent with the European Court of Auditors' findings. So this is, in a nutshell, the character of the events, and, of course, I'm looking forward to the debate.
Many thanks.
Andreas Schwab
Thank you very much, Mr. Knutec, for that initial presentation. Now we give the floor to the European Commission to Ms. Tatiana Lopez Garido. Thank you.
Speaker 17
You. Thank you, Chair. I would like to, first of all, thank the committee and especially, of course, the rapporteur for the draft opinion. The commission shares the objective of ensuring transparency, accountability, and sound financial management. The ACF responds to a structural challenge.
Speaker 10
Europe's productivity growth has slowed, and innovation gaps with global competitors have widened. The Draghi report and the Competitiveness Compass underline the need for a more coherent and strategically focused investment model. The ACF, therefore, consolidates 14 programs into a streamlined architecture that supports the full investment journey from applied research and innovation to scale-up manufacturing and infrastructure deployment. As a directly managed instrument, funding is allocated through competitive calls based on transparent criteria and work programs discussed with member states. This selection-based approach ensures that the EU adds value and maximizes impact for the Union as a whole.
At the same time, the ECF is designed to benefit all member states. European industrial and technological strengths are spread across the Union, integrated along value chains. Accessibility is actually central to the proposal. First, we are proposing a simpler architecture and a single rule book, which will reduce this fragmentation. We're also proposing a single gateway to improve visibility and navigation.
Speaker 18
We are also proposing cross-cutting actions, including, for example, project advisory, SME collaboration, skill support, and value chain integration. They should help build project pipelines across regions. Project advisory will build on the experience of the investee advisory hub, supporting promoters, enriching investment readiness, and crowding in additional public and private finance. On simplification, which is a key element of the ACF proposal, the proposal foresees broader use of financing not linked to cost, as you have mentioned, provided for in the financial regulation. This model lowers entry barriers, particularly for SMEs, by focusing on agreed results rather than detailed cost reporting, while preserving robust safeguards.
Speaker 10
Other forms of funding remain available anyway, where appropriate. And then finally, on the geographical balance and what you consider within the broader MFF framework. So, structural disparities are primarily addressed through cohesion instruments and future national and regional partnership plans. The commission's proposal seeks to combine excellent simplification with strategic impact, fully anchored in financial regulation. We look forward to continuing the constructive dialogue.
Thank you.
Andreas Schwab
Thank you very much, Miss Carido. And now, we come directly to the shadows, and our first speaker is Miss Koyna. Please.
Kinga Kollár
Thank you, Cher. And I will speak in Hungarian, so I'll give you some time.
Dear colleagues, wherever I go in Europe, companies talk to me about similar difficulties. Lots of administration, very complicated application procedures, reporting, and reimbursement procedures. So, we need to change this. The European industry will suffer, and it will never be innovative again or globally competitive if the procedures are so slow. So, this next budgetary cycle provides a fantastic opportunity to rethink application procedures so that the EU can become dynamic instead of slow.
Of course, we need to ensure transparency in the use of resources. Easier reimbursement and easier reporting cannot undermine transparency. Therefore, I hope that during our negotiations, we managed to balance these two aspects. I am especially pleased that innovation and helping less experienced applicants and SMEs appear in the text. I also think that it is very important that, apart from support, we need to use financial tools and guarantees because these tools can lead to a more efficient use of EU funding.
My amendments will be along these lines. Thank you.
Thank you.
Andreas Schwab
Thank you very much for this excellent contribution. Our next speaker is Giuseppe Lupo. Thank you.
Giuseppe Lupo
Thank you very much, Chairman, colleagues. Well, competitiveness and innovation research are political priorities. As we all know, they are important for the future of Europe. So, we do need serious amounts of investment, and we've heard that from Mario Draghi. Setting up a competitiveness fund as part of the next MFF is certainly a step in that direction.
Traceability and transparency, as we see them, are the key elements not only to protect the financial interests of the union but also to ensure that the funds are used successfully. The Commission's proposal, as we see it, has a number of points that require further clarification. The European Court of Auditors, in its opinion on the fund from January 12, flags up a few risks in terms of ensuring the conformity and traceability of the funds spent. OLAF, the EPPO, and the Court of Auditors need to have a key role to ensure healthy financial management and full protection of the financial interests of the Union. We will be putting forward amendments to improve the text.
Thank you very much.
Andreas Schwab
The next speaker would be for the ECR, Mr. Storza, but I don't see him. Then, for the Renew group, Mr. Vasile Vuikulescu and Madarren Suyin Mirro. And for the Greens, Eric Malpat, I don't see him. And therefore, Mr. Kanes, you are next.
Rudi Kennes
Doesn't it work? Yeah. Thank you very much, Chairman. As someone from the left, I, of course, disagree with the very principles of the European Competitive Funds, whose architects pushed the wrong idea that by using taxpayers' money to de-risk private investments and help startups and multinational companies raise their profits, we could somehow revive the economy. But as a member of the committee, an MEP, and a citizen, I cannot help but notice that the ECF will deliver a blow to democracy.
14 funds combined under one, and the leeway for the commission to move money around between different funds and priorities. They say this is to be flexible. I say this is to avoid democratic accountability for spending. The ECF, just like the entirety of the new MFF, sets out a dangerous precedent where the executive power acts first and then asks for forgiveness afterwards. My question is: what are we going to do at the European Parliament to stop the Commission from shifting the scales and save the European Parliament's authority over the budget?
Thank you.
Andreas Schwab
Thank you, Mr. Kennes. That means that we now have a round of colleagues who want to intervene. I don't see any hands raised. So I would then give the floor back to Mr. Njotk. And maybe you can also explain to all of us that if we decide, as a democratically elected body, about how funds are to be created, we are free to keep some flexibility if we, as lawmakers, want that.
Maybe you can also comment on this so that it's clear. Over to you.
Ondřej Knotek
Thank you, Mr. Chairman. Yes, indeed. And I think the comment of our colleague from the left only underlines the importance of our committee because what we are really doing here is trying to introduce elements that will enforce and enhance control, transparency, and all the values of our committee, values for our citizens. So I would also like to thank the commission for the presentation, our shadow reporters for, let's say, drawing up the direction of their amendments. Of course, all colleagues are invited to submit their amendments, and I believe that together, we will be able to shape our part of the homework to the best possible functionality for the ECF, which the majority of us see as very important.
Thank you very much, Mr. Chano.
Andreas Schwab
Thank you very much, Mr. Njortek. Thank you so much, colleagues. That is the closure of our debate on this opinion. Thank you very much for the work. I would like to remind you the next steps in the process are: the deadline for tapping amendments is Monday, March 9 at 02:00, and the vote in committee is on April 15.
And I would like to remind you that even if our meeting is closed now, there is a joint budget and committee meeting today at 11:30 in 1G3. Those who will attend this in one and a half hours or a bit more should then go to Room 1G3 here in the same building for the common meeting with Badge. Thank you very much, and our meeting is now closed.
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