European Commissioners - Emma Bonino (Humanitarian Action), Anita Gradin (Home Affairs and Justice), Manuel Marin (Relations with the Mediterranean, the Middle East and Asia) and Erkki Liikanen (Budget) responded to questions from MEPs and the press concerning fraud following a meeting with the European Parliament's (EP) Committee on Budgetary Control on Wednesday.
This follows indications of irregularities in aid administered by the European Community Humanitarian Office (ECHO) earmarked for Bosnia and the Great Lakes region in 1994 in the Court of Auditors 1997 Special Report. It was alleged that ECHO staff at the time were being paid out of operating credits with the apparent full knowledge of then ECHO Commissioner, Manuel Marin.
Acknowledging that administrative malfunctions had taken place, Emma Bonino stated that out of the 2.4 billion ECU the case concerned, only 500 000 ECUs had actually disappeared. This amount she said should be viewed in relation to the 3.5 billion ECUs ECHO has managed since it was created. She said that as the Commission had discovered the irregularities itself, it was capable of auditing itself. Mrs Bonino admitted that by paying external staff members out of its operating budget instead of its administration budget, “the Commission had used funds irregularly to keep the system operating”.
Manuel Marin on his part emphasised that for a long time humanitarian aid constituted the EU's sole response to the crisis in the former Yugoslavia and Rwanda. This gave rise to a sharp increase in funding with no corresponding rise in the number of staff. In 1992, 43 people managed 368 million ECUs by 1994 63 officials were now responsible 764 million ECU. Mr Marin cited an exchange of letters between himself and Karel Van Miert, then responsible for administrative costs, as evidence of his attempts to ask the Commission's services to avoid dipping into the operation budget for administrative costs.
Erkki Liken reiterated that the Commission had attempted in the early 1990s to stop utilising operation budgets for administration. Now only operational research funds and structural funds along with Tacis, Phare and Meda funds may be used to cover administrative costs. He said within the Commission an inquiry had been initiated to determine which operating credits are still being used for administration. The results of this were to be provided to the Commissioner on Friday 18 September and forwarded to the EP later on in the Autumn. Mr Liikanen cited the Commission's Sound and Efficient Management, SEM 2000, and the restructuring of the Commission's Directorate Generals as evidence of the Commission's attempts to ensure that such malfunctions and irregularities do not occur in the future. Anita Gradin on her part stated that it was up to the Court to determine what had happened to the missing 500 000 ECU
2. MEPs THREATEN BLOCKING COMMISSION IF THEIRS VIEWS ARE NOT HEARD ON REFORM OF COMMON AGRICULTURAL POLICY
The European Parliament is threatening to invoke a rarely used clause in the Treaty of Rome in an attempt to force EU agricultural ministers to listen to their view on reform of the EU's Common Agricultural Policy, CAP. Though the EP is formally confined to a consultative role in agricultural matters, as discussions on CAP reform enter a crucial stage, all political groups within the EP have unanimously decided to deploy Article 43 of the Treaty of Rome, in order to make their voices heard. This article entitles MEPs to postpone their final vote on a proposed measure indefinitely when their opinions divulge sharply from that of the Commission. As proposals cannot become law without the EP giving its opinion, the Commission is then forced to negotiate a compromise with the Parliament. “We have to follow the strategy if we are to bring the weight of the democratic mandate of the Parliament to bear on the CAP reform debate said one parliamentarian”. According to Austrian Agriculture Minister and President in office of the EU Council of Agriculture, Wilhelm Molterer, it is the Council's common interest to have an intense and close dialogue with the Parliament.
3. AGENDA FOR 27th ACP-EU JOINT ASSEMBLY
The agenda for the 27th ACP-EU Joint Assembly taking in place in Brussels from 21 to 24 September has been decided. The session, which takes place just a week prior to the official opening of negotiations between the ACP and the EU on the post Lomé process, will include on its agenda:
A general report on intra-ACP co-operation; A report on the future of ACP-EU relations; The effects of the euro on the ACP, notably the CFA zone; The World Bank's partnership with the EU, the European Investment Bank (EIB) and the African ACP States; Climatic change and small island states; and Trade and development. Further reports on the Assembly will be available from the Eurostep secretariat.
4. MEP CRITICISES OF EUROPEAN NEGOTIATION PROCESS OF MAI
French MEP, Catherine Lalumière, contracted by the French Government to carry out a study on the negotiations of the Multilateral Agreement on Investment (MAI), has stated that findings so far (the report will be out at the end of September) raise serious questions over state autonomy and the shortcomings of the European negotiation process. Mrs Lalumière criticised the paradox of a negotiation which takes place in a closed club of rich OECD member countries even though it concerns first and foremost developing countries. The method of settling disputes whereby businesses are given rights over states but not vice-versa is also heavily criticised.
According to the MEP, it is clear that “there was nobody steering the European ship” during the negotiations. The EU Member States and Council have not gone into the political problems in depth she added. She said civil servants tried their best to produce results without political direction. The MEP concludes that the EU Council did not devote sufficient time to analyse the elements of the negotiations and in short did not fulfil its role in the area of intergovernmental competence. She said lessons should be learnt for the next round of multilateral negotiations in the WTO starting at the end of next year.
Ms. Lalumière's report is supposed to put forward proposals for organising public debate and the objectives which France should set itself within the various forums of multilateral negotiations. OECD negotiations on the MAI are currently suspended after heavy criticism of the process from NGOs, unions and some political parties.
5. IN BRIEF
The EU is hoping to reach a deal on its proposed trade co-operation agreement with South Africa at the end of this week. Even though 85% of the arrangement has been settled, key issues remain. These include South African demands for reductions in tariffs on its cars, textiles and steel, plus extra concessions on sensitive EU agricultural products.
The EU's proposed new Generalised System of Preferences (GSP) offering favourable terms of trade to developing countries have been endorsed by the Commission. (See PAF 100) The main change is to extend preferences to Central and Latin America and incorporate new incentives to encourage adherence to good labour and environmental standards. Due to the uncertainty of the Asian crisis the Commission has postponed updating the scale used to calculate countries' preferences based on poverty.
The West European Union, WEU, Parliamentary Assembly organised a colloquium
on the theme “peace keeping and security in Africa” on 15 September in
Lisbon. Participants of the colloquium included WEU Secretary General Mr.
Cutileiro, the Foreign Minister of Togo and the Belgian Foreign Minister.