Landscape review EU accountability and public audit arrangements Mr. Kevin Cardiff Reporting Member (ECA) Mr. Jacques Sciberras Project team leader ECA Conference, Brussels 14th October 2014

A complex EU accountability landscape ECA SAIs, national, regional auditors Audit Boards and Committees Private External Auditors Internal Auditors incl. Cion AUDIT SCRUTINY ECA Actors Commission Parliament Council European Council ECB ECA ECJ Committees > 40 agencies EIB & EIF Partnerships of many kinds National, regional, local authorities Beneficiaries – 8 million for CAP alone Accountability to: 750+ MEPs European Council and Council (10 configurations) 9,500 national parliamentarians Regional Governments & Parliaments >500 million people Forum for accountability Actor

Situation EU accountability is a complex, enormous industry… no surprise to hear that there are Gaps, Overlaps, or Deficits

Questions addressed? EU Executive Parliament Audit EU What is in and what is out? Who is accountable and for what? Accountable to who? Parliament? Who is the auditor? Strong audit mandate? Does auditor report to Parliament? Audit

6 areas facing challenges Coordinated activities EU institutional setup Multi-speed arrangements Management of the EU budget Partnerships Results of non-budgetary instruments Institutions, bodies and agencies have inconsistent and disproportionate levels of audit and parliamentary scrutiny Intergovernmental activities involve EU institutions, but rely on fragmented scrutiny Europe 2020, European Semester, TSCG, ESM Institutions, Agencies, JUs, ECB, EIB Different groups of MS participating in different policy areas require complex governance and scrutiny structures Particularly for expenditure under shared management frontline governance and scrutiny remains weak at MS level Euro and Eurozone, Schengen area Shared Management in MS Audit limited to stage where funds paid over. Scrutiny depends on quality of partners own governance and accountability systems Strategies, laws and regulations require a comprehensive form of assessment of impact, outcomes and results UN, World Bank, PPPs, 3rd Countries Ex-post assessments, Laws, Regulations, etc

EU response to financial crisis Crisis of confidence Economic crisis Banking Union Financial support mechanisms Economic and Monetary Union (Fiscal Union?) Europe 2020 growth strategy Political response Euro crisis Sovereign debt crisis Banking crisis

Impact of crisis response More and new: bodies and structures with different arrangements uses of and demands on existing structures sets of rules mix of EU and non-EU instruments Public perceptions of EU (and national) systems damaged

5 tracks for reflection Collaborative scrutiny More collaborative scrutiny between Parliaments and auditors for coordinated activities and intergovernmental instruments Consistent and comprehensive arrangements More consistent arrangements across EU policy areas, institutions/bodies, and instruments. Ensure full scope to oversee and audit Better MS level scrutiny Improve frontline (MS) management, governance, scrutiny and audit More focus on results Especially for intergovernmental or non-budgetary EU policies Less audit overlaps Explore all opportunities to avoid duplication of audits and for auditors to rely on the work of one another

A Way forward No simple solutions Engage actors at all levels: local, member state, regional, EU and more Address existing problems Build new initiatives with accountability in mind – use known models where possible

ALEU PCEU A loss of citizens trust occurs when… Powers and Complexity of the EU are out of balance with the Accountability and Legitimacy of the EU

ACCOUNTABILITY EQUILIBRIUM Citizens trust is restored when… PCEU ALEU A NEW ACCOUNTABILITY EQUILIBRIUM