management plan 2019 - european commission · and making the implementation of the eu budget more...

Management Plan 2019

DG BUDGET

Ref. Ares(2018)6601885 - 20/12/2018

Contents

INTRODUCTION ............................................................................................................ 3

PART 1. MAIN OUTPUTS FOR THE YEAR ........................................................................... 6

1. Driving the process of strategic budgetary planning: Multiannual Financial

Framework (MFF) ......................................................................................... 6

2. Managing the expenditure of the EU budget efficiently within the framework of the MFF ....................................................................................................... 6

3. Efficiently and effectively manage and control the revenues of the EU budget ...... 7

4. Maintain a high quality central accounting /financial and reporting framework ...... 8

5. Support to Commission Services through Treasury management and recovery of funds management, evaluation of local systems and a high quality Information System (ABAC) ........................................................................... 9

6. Promote consistency and simplification of financial rules, sound financial management and cost-effectiveness of controls .............................................. 10

7. Ensuring that performance is at the core of EU spending ................................. 11

8. Ensure effective management of the relations with the European Court of Auditors (ECA) and other institutions paving the way for the annual discharge of the

Commission in the implementation of the EU budget ....................................... 12

PART 2. MAIN ORGANISATIONAL MANAGEMENT OUTPUTS FOR THE YEAR ................................. 14

ANNEX 1. TABLES WITH MAIN POLITICAL OUTPUTS AND INDICATORS ..................................... 19

ANNEX 2: REPORTING OBLIGATIONS OF DG BUDG(SEE SPECIFIC OBJECTIVE 4) ................ 32

INTRODUCTION

As presented in the Strategic Plan 2016-2020, DG Budget (hereafter DG BUDG) is the

central service of the Commission responsible for the preparation and implementation of

the EU budget throughout the annual and multiannual cycles. The DG is also responsible

for the legal framework applicable to the implementation of the EU budget by the

different Institutions, agencies and Member States, and it plays a key role in promoting

sound financial management and a strong performance culture. Its responsibilities and

political priorities are guided by the Treaty and further defined on the basis of President

Juncker's political guidelines set for the Commission 2015-2019.

In this capacity, DG BUDG plays a central role in ensuring that the EU budget is

effectively executed and complies with financial rules and that the Commission is

accountable for the management of tax payer's money. In this context, DG BUDG aims at

ensuring that the EU budget delivers concrete results and added value across the EU

policies.

In 2019 DG BUDG will continue to aim at maximizing the contribution of the EU Budget

to the achievement of all General objectives of the Commission and in particular,

General Objective 11 "To help achieve the overall political objectives, the

Commission will effectively and efficiently manage and safeguard assets and

resources, and attract and develop the best talents". This is translated into 8

specific objectives which cover the work that is being carried out in the DG, leading to

concrete outputs every year within the multiannual cycles of preparation,

implementation, reporting and discharge of the EU budget.

Facilitating the negotiations on the Multiannual Financial Framework (MFF) 2021-

2027 will be a core objective for DG BUDG in 2019. The Commission advocates reaching

a timely agreement in 2019 by the European Council and a formal consent of Parliament

on the proposed long-term budget package, including the next MFF Regulation, Own

Resources Decision and Regulations, and Interinstitutional Agreement. DG BUDG,

together with the Secretariat General of the Commission, will support the technical and

political negotiations lead by the Romanian and Finish Council Presidencies with a view to

reaching an agreement on a modern, balanced,fair and sufficiently funded EU

long-term budget including rules protecting the budget in case of generalised

deficiencies as regards the rule of law in the Member States.

The maximisation of European added value will guide the next generation of

spending programmes. In collaboration with other central services DG BUDG will ensure

that such a focus remains at the core of programme design and execution.

The Budgetary process for 2020, the last one to be proposed by this Commission, will

be prepared and adopted in the course of the year, through a constructive dialogue with

the two arms of the Budgetary Authority. The 2020 budget will take account of the

financial programming with regard to the last tranche of commitments related to the

current generation of multi-annual programmes and any relevant new development. An

appropriate level of payment, respecting the MFF ceiling, should ensure implementation

of all programmes can continue at cruising speed.

Budget proposals may be necessary during the year to respond to unforeseen needs1

and/or take account of the pace of budget implementation. As in previous years, this will

1 The Management Plan is based on the assumption of an orderly UK withdrawal in line with the financial settlement included in the draft withdrawal agreement. Contingency measures may have to be proposed for other scenarios.

be done respecting the provisions of the multiannual financial framework and, as far as

possible, trying to minimise any unforeseen impact on national budgets.

DG BUDG has a leading role in the protection of the financial interests of the Union and

sound financial management as regards EU budget revenues. In 2019, it will continue

effective management and control of own resources, ensuring that proceeds due

to the EU budget are recovered timely and in full to the EU budget. Inspection

programmes to Member States will be tailored to the risks identified, including the risk of

fraud. In the area of Traditional Own Resources in particular, controls will concentrate on

significant risks like undervaluation, to ensure that customs duties are collected and that

the risks related to unusual trade patterns are swiftly identified and effectively addressed

by Member States.

DG BUDG plays a critical role to deliver on the Commission’s transparency and

accountability obligations for the implementation of the EU budget. In 2019, DG BUDG

will prepare the Integrated Financial and Accountability Reporting as set out in the

new Financial Regulation. This reporting informs the discharge authority in a

comprehensive and transparent manner on the spending and results achieved by EU

programmes.

It includes the EU annual accounts, where the objective in 2019 will be that the 2018

EU annual accounts receive a clean bill of health from the Court of Auditors for

the twelfth consecutive year and that the management of own resources is once more

free from material error. DG BUDG will continue to support sound financial management

and to improve the financial reporting framework in order to ensure appropriate

accountability as well as a more effective public communication to key stakeholders and

citizens in general.

The modernisation of the current budgetary and accounting system ABAC (to be

replaced by the so-called SUMMA project), which started in 2018, will reach its cruising

speed in 2019. SUMMA, which is built from off-the shelf technology, will bring significant

efficiency gains resulting from standardized and more automated processes,

simplification for the users through an enhanced user interface, better data quality and

analytics capabilities improving regulatory and management reporting. This future-proof

system will also be integrated with other corporate solutions and contribute to the

rationalisation of the Commission’s IT landscape.

In line with the better regulation agenda of the Commission and the legislative proposals

for the 2021-2027 MFF, DG BUDG will focus during 2019 on providing support, guidance

and training to the services in the implementation of the new features of the new

Financial Regulation. In charge of leading and modernising the financial community

accross EU institutions and bodies, DG BUDG will continue its work aiming at simplifying

and making the implementation of the EU budget more flexible, including simplification

measures focussed on the delivery of concrete results on the ground.

DG BUDG will also treat as a priority the implementation of the revised rules related to

conflicts of interest in the new Financial Regulation taking concrete steps to provide

guidance and promote best practices in the Member States.

In order to set performance at the core of EU spending, DG BUDG will promote more

in-depth programme performance analysis in the frame of the annual budgetary

cycle, to better inform the budgetary decision-making process and enhance

communication on results achieved through the EU Budget.

Finally, in 2019, the European Parliament will decide on whether to grant the Commission

with the discharge for the implementation of the 2017 budget. This procedure,

which will be the last one to be held under the current European Parliament, ensures full

accountability and transparency in the budget implementation.

budg_mp_2018 5

DG BUDG strategy is reflected throughout its 8 specific objectives that are presented in part 1 of this document together with the main political outputs

to be achieved during the year. See table below with the main milestones expected in 2019 in the framework of DG BUDG Strategic Plan 2016-2020:

2 Recalculation of cohesion envelopes. 3 For information, responsibility of the operational DGs.

CALENDAR STRATEGIC PLAN DG BUDGET

2016 2017 2018 2019 2020

An

nu

al

acti

vit

ies

Annual budget Adoption budget 2017 Implementation budget

2016 Adoption of annual accounts 2015

Adoption budget 2018 Implementation budget 2017

Adoption of annual accounts 2016

Adoption budget 2019 Implementation budget






Discharge Discharge budget 2014 Discharge budget 2015

Discharge budget 2016



Str

ate

gic

mu

ltia

nn

ual

acti

vit

ies

Results and

added value of

the EU budget

Conference

Launch of experts group

Contribution to MTR

Conference

Contribution to post 2020 MFF and review of programmes legal basis

Conference

Development of new in-

depth programme

performance analysis framework

Implementation of new

in-depth programme

performance analysis framework

Multi-annual Financial Framework

(MFF)

Special Technical Adjustment2

Proposal Midterm review

/ revision

Report HLGOR

Proposals post 2020 MFF Proposal programmes next MFF3

Agreement on the 2021-2027 MFF

Finalisation of the 2021-2027 MFF legislation (except Own Resoures

Decision ) and sectoral programmes

Financial regulation(FR)

Adoption of simpler and more flexible financial rules (contained in the FR and in 15 legislative acts)

Proposals of next MFF programmes aligned to FR

Implementing the 2018 Financial Regulation and aligning sectoral and other legal acts

PART 1. MAIN OUTPUTS FOR THE YEAR

1. Driving the process of strategic budgetary planning: Multiannual Financial

Framework (MFF)

On the basis of its proposals of May and June 2018, the Commission aims to broker a

timely agreement on the future Multiannual Financial Framework (MFF) for the period

2021-2027. The inter-institutional negotiations on the comprehensive package of

legislative and policy proposals, including the simplification and reform of the system for

financing the EU budget, will continue with a view to reaching maximum progress at the

Leaders' Summit in Sibiu on 9 May and a political agreement by the Council in 2019.

DG BUDG, in close cooperation with the Secretariat General, will continue to provide the

necessary inputs and collaboration with the Council, the European Parliament, Member

States and other stakeholders to make a swift agreement on a balanced and modern EU

budget. This includes: contribution to the draft European Council conclusions (negotiation

box), preparation of interventions by the Commissioner responsible for Budget and the

Commission President, technical inputs on elements of the package on the expenditure

side (e.g. programmes, Euro area budget) and the revenue side (e.g. modernisation of

the current system of own resources and introduction of new own resources).

In addition, the financial programming of the remaining years of the current MFF, 2019-

2020 will incorporate the changes agreed with the 2017 mid-term revision. The

Commission will also update regularly its long-term forecast of future inflows and

outflows of the EU budget. The financial programming is based on the assumption of an

orderly UK withdrawal based on the financial settlement included in the draft withdrawal

agreement.

A cost benefit analysis will be carried out in order to prepare for the potential delegation

of programmes under the new MFF with a view to having a formal agreement on the

delegation package in 2020.

2. Managing the expenditure of the EU budget efficiently within the framework

of the MFF

2019 is the penultimate year of the current multiannual financial framework and the last

of the mandate of the current Commission.

The Budget for 2019 was adopted by the European Parliament in its plenary session on

13 December 2018. It reflects and supports the EU political priorities, in particular

contributing to the greatest extent possible to jobs, growth and investment, and

providing a European response to current challenges such as migration management and

protection of external borders as well as climate change.

Budget proposals may be necessary during the year to respond to unforeseen needs

and/or take account of the pace of budget implementation, or to take account of the

outcome of Brexit negotiations. As in previous years, this will be done respecting the

provisions of the multiannual financial framework and, as far as possible, trying to

minimise any unforeseen impact on national budgets.

A strategy will be established together with DG Human Resources to maximise the

occupation of posts under the establishment plan (within the constraint of the available

appropriations).

The Budget for 2020 will need to be prepared and adopted in the course of the year.

The Draft Budget, the last one to be proposed by this Commission, is expected to reflect

continuity in policy and is likely to maintain the focus on political priorities similar to

those of the Budget 2019. The 2020 budget will confirm the last tranche of commitments

related to the current generation of multi-annual programmes. An appropriate level of

budg_mp_2018 7

payment, respecting the MFF ceiling, should ensure implementation of all programmes

can continue at cruising speed.

The mandate for the new Commission in 2019 and the preparation of the new generation

of programmes, may require changes to the administrative organisation. The search for

synergies and efficiencies must continue as new challenges will need to faced with a

stable level of staffing. This will also involve amending the IT environment to cope with

the modified budget structure proposed for the next Multiannual Financial Framework.

3. Efficiently and effectively manage and control the revenues of the EU budget

The own resources of the EU will continue to be effectively managed and controlled

during 2019, as reflected in the Declaration of Assurance from the ECA in previous years. Furthermore, the outcome of negotiations on the Commission's new own resources

legislative package adopted in May 2018 will pave the way for the future management

and control of revenue in the future MFF 2021-2027. DG BUDG will continue to

accompany the negotiation process to facilitate compromise at all stages and in various

fora, especially in the Council.

The management and control of traditional own resources (TOR), mostly customs duties,

involve performing inspections in Member States, working closely with other services

involved in anti-fraud activities and overall monitoring of EU Customs policy. The 2019

inspection programme for TOR will be executed following a risk-based approach with

more emphasis on Member States with bigger imports, concentrating on significant risks

like undervaluation. Inspections will be geared to ensure that the collection of TOR is

properly protected and that the risks related to unusual trade patterns are swiftly

identified and trigger an adequate level of controls by Member States.

To address the significant risks posed by undervaluation, DB BUDG has inspected 16

Member States in 2018 to check their control strategy in the field of customs value and

will inspect the remaining 12 Member States in 2019.

In addition, DG BUDG has increased cooperation with the DGs involved in the protection

of traditional own resources and meets regularly with OLAF and TAXUD to better

coordinate and react faster to mitigate the risks identified. There are quarterly meetings

between the three DGs at Director’s level while ad-hoc meetings take place regularly at

technical level to discuss new initiatives, legal proposals or guidance to Member States.

DG BUDG has increased participation in meetings organised by TAXUD with the customs

authorities of the Member States (Customs Policy Group (CPG), Experts’ Group, Customs

Union Working Party).

DG BUDG is taking a number of preventive measures on this matter vis a vis Member

States to raise awareness and foster actions to protect the EU budget. In March 2018,

DG BUDG convened meetings with the three Member States most concerned by the

undervaluation phenomenon; In July 2018, DG BUDG gave a presentation on

undervaluation to the national customs’ Directors General in the CPG; In July, during the

Advisory Committee on Own Resources (ACOR), DG BUDG organised a presentation of

the new financial risk criteria that will help having a more consistent approach to financial

risks in customs and in December DG BUDG presented the first preliminary results of the

inspections 2018 and insisted on the measures to be taken to effectively tackle this

fraud.

The first analysis of the trends at EU level show a decrease in the imports of undervalued

textile and shoes from the People’s Republic of China. DG BUDG will continue having a

systematic and proactive approach in 2019.

DG BUDG will follow up on ongoing infringement cases involving a loss of traditional own

resources, taking appropriate action to make good to the EU budget the losses.

budg_mp_2017 8

Some 12 inspections are planned for 2019 the control of the VAT-based own resources,

and DG BUDG will cooperate closely with Eurostat on inspection activity concerning GNI-

based resources.

The management and control of the revenues of the EU budget, as described above, is

based on the assumption of an orderly UK withdrawal based on the financial settlement

included in the draft withdrawal agreement.

4. Maintain a high quality central accounting /financial and reporting

framework

The Commission demonstrates its accountability by providing high-quality and timely

financial and other information to its stakeholders, both internal and external. In this

context, DG BUDG will publish, as every year, the Integrated Financial and

Accountability Reporting in July. This package, which provides an essential input for

the annual discharge procedure, is the key reporting allowing the EU to deliver on its

transparency and accountability obligations for the implementation of the EU budget. It

includes: the EU annual accounts, the Annual Management and Performance Report

(incorporating information on the protection of the EU budget), future cashflow forecasts,

the annual internal audit report, the report on the follow-up to the 2017 discharge and

the programmes’ performance overview.

In addition to the EU annual accounts, DG BUDG is also tasked with preparing the

annual accounts of the Commission, the European Development Fund and many other

entities4.

The key objective is that the (accruals based) 2018 EU annual accounts receive a clean

bill of health from the Court of Auditors for the twelfth consecutive year. This will require,

as every year, important contributions and efforts from DG BUDG, in particular the

accounting services as well as the DGs. DG BUDG will continue reinforcing the need for

greater attention to their accounting controls.

As was done in the previous two years, DG BUDG will work closely with other DGs, other

entities and the Court to deliver on its commitment to the discharge authority that the

accounts will be adopted much earlier than the legal deadline (i.e. by end of June instead

of end of July) so as to allow the discharge process to begin as early as possible. For the

2018 accounts, DG BUDG will continue to pay particular attention to the use of new tools

for implementing the budget, such as financial instruments (e.g. European Fund for

Strategic Investments (EFSI) and instruments in the external policies area). Up to now,

the coordinated work with the DGs and entrusted entities has resulted in no major

problems in the accounting field, which is reflected in the limited findings received from

the auditors in this area.

The accounting and reporting services in DG BUDG will have additional tasks in 2019 in

relation to Brexit as there will be certain reporting requirements, regardless of the

outcome of negotiations. Planning for these reporting tasks has already begun in 2018, in

cooperation with the DGs and other consolidated entities, as well as the Court of

Auditors.

Further progress should be made in 2019 towards the development of financial reports

centrally, that would address reporting needs across the Commission, including at

managerial level, allow for a more efficient use of resources, avoid duplication of effort

and ensure consistent information produced and shared within the Commission. The

progressive enrichment of a corporate financial reporting portfolio along with the

addition of financial dashboards will contribute to the improvement of budgetary

management and accountability.

4 Using the resources and expertise at its disposal, DG BUDG's accounting services are already providing high quality services to 2 other EU institutions, 4 EU agencies, 5 joint undertakings, 4 trust funds and 3 non-EU bodies including the EDF.

budg_mp_2018 9

The Commission will also continue to raise the profile of its accounting services within

the global accounting profession through participation in conferences and standard

setting activities, the most relevant of which include the status as observer of the IPSAS

board, full membership of the IPSAS Consultative Advisory Group, member and regular

contributor of the EPSAS task force and participation in international treasury networks.

Efficiency efforts will continue in 2019. Accounting procedures in the domain of expenses

and the year-end closure are being addressed, to achieve more simplification, reducing

further the workload of Commission services while maintaining a high quality of reported

data. Work will also continue on an efficient and simple consolidation of EU entities

figures in the EU accounts. Much of these efforts will be tied in to the work being done to

implement the new accounting system.

5. Support to Commission Services through Treasury management and

recovery of funds management, evaluation of local systems and a high

quality Information System (ABAC)

During 2019 DG BUDG will continue to support other DGs in the implementation of the

annual budget, via an efficient execution of payments and recoveries driven by the

corporate information and accounting information system ABAC.

The Commission must safeguard its assets and the Accounting Officer is responsible

for the safekeeping of its cash and cash equivalents, as well as those of the other entities

he is responsible for; for this purpose BUDG's services establish and apply appropriate

risk and cash management policies.

Treasury and cash management will probably continue to be particularly challenging

in the course of 2018 in view of the persistence of a negative interest rate

environment5 . In addition strong monitoring of cash flow to ensure the orderly and

timely execution of all payments is key to budget implementation. Such monitoring

procedures may need to be adapted in the course of 2019 depending on the evolution of

Brexit negotiations and its impact on budgetary cash flows. A careful cash flow planning

will also be essential for the Trust Funds, in order to ensure timely and efficient payment

execution while minimising any potential impact of negative interest.

In addition to own resources, the Commission will continue during 2019 to recover all

amounts due, including competition fines, amounts unduly paid and penalties imposed

upon Member States as efficiently and effectively as possible, using all the means

available to protect the EU's financial interests, including offsetting, and applying an

appropriate risk management for provisionally cashed fines and bank guarantees.

To guarantee the successful delivery of the above mentioned financial services, the

European Commission needs a financial information system that is efficient in terms of

business operations and low in cost of ownership. Today, the finance platform ABAC has

an impressive track record. Nevertheless, the continuous customisation of the platform to

meet the business requirements led to a complex environment and is reaching its end-of-

life. Therefore actions in the ABAC Roadmap were set up to revise the current ABAC

architecture.

The Commission's IT Board approved in October 2017 the ABAC modernisation. ABAC

will be replaced by a new state-of-the-art system, named SUMMA, that would

support the Commission’s key financial day-to-day activities with the latest available

technology from SAP (S/4 HANA). Beyond the technology replacement, this project will

be taken as an opportunity to standardise and simplify the Commission's financial and

accounting processes (with the subsequent reduction in cost of ownership), improving

the user experience in the Authorising Officer Services, and facilitating the decision

5 In this context the latest amendment of the Making available Regulation and of the European Development Fund financial

regulation respectively provide for the future protection of the EU own resources and of the EDF contributions from the

impact of negative interest

budg_mp_2017 10

making process through integrated reporting and enhanced analytics capabilities. It will

also contribute, together with other corporate initiatives (e.g. eProcurement and SYGMA),

to rationalise the IT landscape and reduce the number of Local Systems. The project

started in January 2018 by setting up the project team & governance and the launch of

the analysis. The solution design phase will start in 2019 and a preliminary version of

SUMMA is expected to surface by the end of 2019. The full implementation of SUMMA is

expected to take 4 to 5 years.

Changes and developments in current ABAC will be reduced to the absolutely necessary,

practically shifting to a maintenance development mode, without compromising the

availability of the system, its reliability and security.

DG BUDG will remain available to providing Accounting Officer’s services to any other

interested entity (14 agencies and Joint Undertakings are provided these services at the

end of 2018), resulting in important cost savings for the relevant entity, while

maintaining (and often improving) its performance and resilience.

DG BUDG will continue to assess the risk of internal control weaknesses in local

systems, which may result in errors or omissions having a material impact on the EU

accounts or on management and financial reporting. In doing so, DG BUDG will continue

to ensure a high level of accounting quality and share best practices across

authorising departments.

Since 2017, DG BUDG has developed and implemented a new strategy to the

validation of local systems, significantly increasing the efficiency of the process. It

allows covering all 59 DGs, Agencies and Joint Undertakings (JUs) under the

responsibility of the Accounting Officer of the Commission in four years instead of nine.

The new strategy, will be further developed in 2019.

For reasons of efficiency and internal control, DG BUDG provides a central framework for

budgetary execution through ABAC. It consists in setting up rules and managing data so

that spending departments respect the formally approved appropriations and meet

minimal reporting standards. Some budgets have a multi–annual character

(European Development Fund and Trust Funds), but most of them are annual

(Commission, EDPS, EEAS, EDPS, agencies and JUs) to which year transition activities

apply. They relate to making available the newly adopted structures and appropriations

and carrying over the outstanding appropriations/commitments in respect of the

applicable articles of the (revised) Financial Regulation. Being at the core of budgetary

execution, it is crucial conceiving (even more) performant functionalities in the future

SUMMA system related to the budgetary framework, e.g. to integrate the new budgetary

nomenclature for the next programming period (MFF).

6. Promote consistency and simplification of financial rules, sound financial

management and cost-effectiveness of controls

For 2019, the main priorities of the Central Financial Service will be to contribute to the

preparation of the MFF 2021-2027, to fully implement the Financial Regulation 2018 and

to lead and modernise the financial community.

The Central Financial Service will contribute to the preparation of the MFF 2021-2027 by

supporting the negotiations of the new sectoral spending programmes promoting

simplification, flexibility, interoperability and a single set of rules where different sources

of EU funding are combined. It will contribute actively to the negotiations on the Invest

EU Regulation in order to achieve a single operational framework for the implementation

of financial instruments and budgetary guarantees supported by a Common Provisioning

Fund. In view of establishing such a fund, an independent external evaluation of its asset

management will be conducted. The Central Financial Service will also lead the

negotiations on the Commission proposal on the protection of the Union’s budget in case

of generalised deficiencies as regards the rule of law in Member States.

A second key area of action will be the full implementation of the Financial

Regulation 2018. The Central Financial Service will treat as a priority the extension of

budg_mp_2018 11

the rules on conflicts of interest to shared management taking concrete steps to

provide guidance and promote best practices in the Member States.

In addition, the Central Financial Service will conduct the alignment of various legislative

acts to the Financial Regulation 2018 leading to the adoption early 2019 of a new

Financial Framework Regulation applicable to decentralised agencies, a new Model

Financial Regulation for public-private partnerships bodies as well as a new European

Development Fund Financial Regulation. With this alignment, these bodies and the

European Development Fund, budget will benefit from the simplification achieved in the

Financial Regulation 2018, work with better governance rules and provide more

comprehensive reporting including on their performance.

Work will also continue to simplify the implementation of the budget with the adoption of

guidance and Commission decisions (simplified cost options, recognition of volunteers

work). The revision of Financial Administrative and Financial Agreements with our main

international partners will allow extending to them the benefits of cross-reliance on

audits and assessment as well as a single set of rules based on indirect management.

This revision, together with the new contribution agreements in indirect management,

will also support the promotion of other EU policies such as the rules on Non Cooperative

Jurisdictions and EU tax avoidance standards.

The third priority area of the Central Financial Service will be to lead and modernise the

financial community by providing guidance, training and advice on the application of

financial rules to the Commission, other Institutions and bodies through different

channels (helpdesk, training, templates of legal documents and correspondence,

communities of practice, BudgWeb, networks, newsletter). Special emphasis will be made

in 2019 on steering progress towards a single financial portal (SEDIA), e-grants and

e-procurement .

In the area of Internal Control, the Central Financial Service, together with the SG, will

continue to promote best practice, review the DGs' annual activity reports and contribute

to a strengthened corporate oversight over critical risks. The Central Financial

service will also encourage further use by the DGs of the Early Detection

Exclusion System (EDES), in line with the IAS audit.

7. Ensuring that performance is at the core of EU spending

Over the past years, in the frame of the Budget Focused on Results initiative, the

Commission has ensured that a solid performance framework is at the heart of EU

spending and that the communication of the corresponding benefits is improved. Going

forward the focus will be on a more rigorous assessment of programme performance,

including a more direct feedback loop, to ensure that EU funds continue to be spent in

the most efficient and effective manner.

In order to set performance at the core of EU spending DG BUDG will proceed along

three major axes: i) more in-depth programme performance analysis in the frame of the

annual budgetary cycle to inform/influence it; ii) statutory and discretionary programme

reporting – complemented by stakeholder outreach – to communicate achievements of

the EU Budget as well as the results of performance assessments; iii) further developing

operational elements of the performance framework proposed for the future generation

of programmes. In stepping up the performance budgeting efforts DG BUDG will work

very closely with SG and other central services as well as with spending services.

On the first axis, DG BUDG will start working towards the inclusion of analyses of

programme performance ('programme performance assessments') into budgetary

allocation considerations, thereby establishing a feedback loop on programme

performance and providing for input to the preparation of the annual budgets. In addition

DG BUDG will design a framework for focused economic analyses of programme

performance to ensure EU spending has a high value added.

The second axis entails performance reporting and communication. Key deliverables

are the "Programme Statements", a summary version thereof: the "Overview" as well as

the Annual Management and Performance Report. Beyond such statutory documents

budg_mp_2017 12

required by legislation, DG BUDG will also be working on publishing online (in the form of

a dashboard) key EU Budget performance data and on consolidating spending

programme performance reporting and communication across the Commission. Finally,

DG BUDG will continue to take a leading role with SG on budget performance advocacy

inside the Commission and vis-á-vis stakeholders.

The third axis consists of building on the existing EU Budget performance framework and,

in cooperation with SG, developing it further for the post-2020 programmes. This entails

safeguarding during the MFF negotiations the "core" objectives and indicators proposed

in the MFF programmes, complementing them – as necessary – with additional metrics,

and designing an efficient and effective monitoring and evaluation system around

it. This will ensure that information on EU spending is available for multiple objectives

from in-depth programme analysis to overall communication of the results and impact of

the EU Budget.

8. Ensure effective management of the relations with the European Court of

Auditors (ECA) and other institutions paving the way for the annual discharge of

the Commission in the implementation of the EU budget

The outgoing European Parliament will vote in March 2019 on the discharge for

the financial year 2017. This procedure got off to a good start with the publication in

October 2018 of the ECA’s 2017 Annual report which presented very positive results

overall for the financial management of the EU budget:

the level of error was estimated to the lowest ever and dropped from 3.1% in the

preceding year to 2.4%;

for the second year in a row the Court of Auditors considered that the level of error

was below the materiality threshold of 2% for around half the budget and issued a

qualified instead of an adverse opinion;

and the EU accounts received a positive opinion for the 11th year in a row.

Acknowledging the significant improvements in the financial management of the EU

budget, the discharge authority continues to increase its focus on the results achieved by

the EU budget, taking into account the ECA’s annual report, special reports and other

products as well as the Commission’s own reporting, in particular the Integrated Financial

and Accountability Reporting.

In this light, DG DG BUDG will continue supporting other DGs in their efforts to

implement EU programmes cost-effectively to prevent errors and take appropriate

mitigating action, including recoveries and financial corrections, whenever appropriate. It

will guide DGs in their establishment of and reporting, in their Annual Activity Reports, on

the amounts at risk at payment, amount at risk of reporting, and the amount at risk at

closure to ensure that the concepts are applied and reported in a consistent manner

across Commission departments.

The ECA intends to further develop its Statement of Assurance (DAS) approach,

building on the legality and regularity information provided by the Commission and

Member States. DG BUDG will act as the point of contact for the ECA’s central services

and will ensure proper coordination across Commission departments on this matter. In

this context, while supporting the European Court of Auditors efforts to modernise the

DAS, the Commission in general and DG BUDG in particular will pay special attention to

the respect of some principles such as: (1) no increase of administrative burden or

additional costs for the Commission, Member States or beneficiaries, in particular no shift

of workload/tasks from the ECA to the Commission (2) no change in the Commission

governance arrangements at this stage and (3) the new approach should accommodate

for the different policy areas (no "one-size fits all approach").

DG BUDG will monitor the Commission’s follow-up of requests made by the European

Parliament and Council during the discharge procedure, and recommendations made by

the ECA in its audit reports. In that context, DG BUDG will ensure that the Commission’s

budg_mp_2018 13

Audit Progress Committee receives, based on the information entered by the DGs in the

corresponding database, comprehensive and timely overviews of outstanding and

overdue requests and recommendations. To this end, DG BUDG has taken steps to

modernise its existing database for recommendations (RAD).

For the first time in 2019 DG BUDG will prepare the Integrated Financial and

Accountability Reporting as set out in the new Financial Regulation. This package

will inform the discharge authority in a comprehensive and transparent manner on the

spending of and results achieved by EU programmes. It will be released by 31 July at the

latest and will contribute to a shortening of the discharge procedure as called for by

the European Parliament.

DG BUDG will continue coordinating the Commission’s response to the ECA reports

and other products as appropriate. The increased number of special reports covering

cross-cutting and/or politically sensitive issues along with the ECA’s new products

(briefing papers, rapid reviews, landscape reviews) is gradually changing BUDG’s role

from steering adversarial procedures to also providing advice and guidance to DGs at

early stages of audits and other tasks carried out by the ECA.

Looking ahead, the 2018 discharge procedure will kick-off in the autumn 2019 with the

newly elected European Parliament. DG BUDG, in close coordination with all the

concerned DGs in the Commission, will therefore have to build a new relationship with

the next Committee on Budgetary Control and its Members, and be ready to adapt to any

changes this Committee might wish to introduce in the discharge procedure.

The EU-wide PIC Network provides a forum for the exchange of good practice on key

Internal Control challenges in the quest for improved governance systems in Member

States. Future direction of the PIC Network will be driven by Member State demand, as

will be set out in their responses to a high level questionnaire sent by the Commission in

October 2018. Ways of collaboration with shared management DGs will be analysed.

Continued guidance and support is provided to candidate, potential candidate and

relevant ENP countries on Public Internal Financial Control and External Audit

reform; and progress is monitored in line with institutional reporting requirements.

Specific focus may be afforded to Western Balkan countries, in line with the 2018

Commission Communication on a credible enlargement perspective for those countries.

budg_mp_2017 14

PART 2. MAIN ORGANISATIONAL MANAGEMENT OUTPUTS FOR THE YEAR

A. Human resource management and organisational aspects

The implementation of the new HR Modernisation has changed the way HR services are

delivered. These are now delivered by an Account Management Centre (AMC) in DG HR

and each DG has its own HR Business Correspondent, responsible for defining the HR

strategy in agreement with the management of the DG.

DG BUDG is supported by the AMC 7.

In 2019, DG BUDG will focus its Human Resource Management on the following:

Equal opportunities:

The revised objective set in the Commission's Decision of 19th July 20176 for the DG was

to nominate 3 new female managers by November 2019. In 2018, DG BUDG already met

the targets set. DG BUDG paid special attention to women applicants to middle

management positions, and encouraged proactively female potential candidates to apply

for the two heads of unit posts that had to be filled in 2018.

Notwithstanding, efforts will continue in 2019 to prepare women for future management

posts in line with the Commission’s renewed approach to reaching its target of 40%

female managers by the end of 2019. In this sense, the talent management programme

participants and candidates will be offered the possibility to create a network which could

further explore their common goals and opportunities.

A more inclusive management programme will be launched in 2019 and will address all

AD colleagues with the potential to become managers in the future.

Staff engagement:

DG BUDG will continue to address saff concerns expressed in the HR satisfaction survey.

The 2016 HR staff survey showed an overall staff engagement score of 70%7, which is

6% above Commission’s average and a 2% increase since the previous HR survey. On

this basis, DG DG BUDG prepared an action plan that that resulted in implementing

various actions in 2018, The efforts will continue in 2019 with actions aiming at

addressing the results of the HR satisfaction survey 2018.

DG BUDG also collected feedback from staff through other channels: a DG satisfaction

survey was launched in September 2018 and a Focus Group composed of representatives

of all Directorates and the HR BC was created to analyse its results and propose an

action plan whose rollout will start in 2019, all in a goal to optimize working relationships

and improve motivation levels. The action plan is structured around 4 pillars: people,

environment, know-how and strategy & culture.

A senior management retreat will be organised in early 2019 with the objective of

adapting the HR and organisational changes proposed in the action plan. The action plan

will then be presented and colleactively adopted during an Away Day event with all the

staff of DG BUDG in February 2019.

6 SEC(2017)359

7 The response rate was 55% (309 out of 557 staff members)

budg_mp_2018 15

Wellbeing:

DG BUDG will continue to invest in the wellbeing of its staff in 2019. The DG organised a

number of actions in 2018, including an "Activity Fair" organised in February 2018 to

promote and encourage participation in leisure activities offered by the Commission and

other Institutions (yoga, basketball, safe cycling, running, etc), increased its offer and

the communication of new activities such as Pilates, massage and mindfulness sessions.

DG BUDG participated and will continue to participate in 2019 in other activities such as

the “Velomai” cycling and the “Run for Europe” competitions. DG DG BUDGwill actively

search for more and better facilities such as improved areas for showers, additional

bicycle parking spaces and charging possibilities, refurbish the existing Wellbeing Room

and discuss with the OIB the possibility to convert other spaces into Wellbeing Rooms in

the future.

Mobility & career development:

DG BUDG offers the possibility of short stages in other units of the DG under the

programme called “Working together”. These will continue to be promoted in 2019, given

the their positive impact on staff’s motivation and engagement and their effect of

providing additional possibilities for internal mobility.

Futher reflection will be given to identifying areas and better ways of working in project-

based activities, where better communication and sharing of information could further

enhance cross-fertilisation between directorates and units.

B. Financial management: Internal control and Risk management

DG BUDG manages an administrative expenditure, including procurement, whose

intrinsic risk is rather low due to its limited amount, as well as the centralized and direct

mode of budget implementation. The risks are effectively mitigated by means of ex-ante

and ex-post controls put in place.

In the framework of streamlining of procedures and paperless administration, DG BUDG

finance unit aim at a generalized use of computerised document management and

electronic procedures. The management of financial transactions is an internal process

where blue ink signature is not required; the electronic signature in Ares and Abac is

sufficient. Moreover, most of the documents involved in the initiation and validation of a

transaction already exist in electronic version.

The objective is to fully implement the electronic financial workflow for all transactions.

An electronic paperless financial workflow will be put in place for de-commitments,

regularizations and payments during the first quarter of 2019 and all other financial

transactions will progressively be covered by the new system throughout the year.

Electronic workflows have proven to be reliable and fast and will contribute to efficiency

gains in our financial management.

The last part of 2018 has been devoted to be fully on board on e-request and e-ordering

and e-invoicing. Progress has also been made on the on boarding on e-submission

modules and DG BUDG aims at using them, with the assistance of DIGIT, for the next

call for tenders that will take place during 2019.

As regards revenue financial operations relating to the collection and making available of

own resources, DG BUDG analyses the systems set up by Members States and assesses

whether they provide reliable assurance as regards the accuracy of the information

provided and the legality and regularity of these operations ( see specific Objective 3). In

case DG BUDG determines that it cannot rely on some of these systems for assurance

purposes, it would qualify its annual Declaration of Assurance in case the amount of

revenue concerned could exceed 1 % of the total relevant resource-segment (i.e. TOR, or

VAT/GNI -based own resources).

budg_mp_2017 16

The execution rate of 2018 administrative budget as of the preparation of this report

(credits authorized in the 2017 budget) was 99.50 % of commitment appropriations.

Concerning the payment deadlines, 96.91 % of payments were made on time in 2019.

The same levels of execution and timely payments are expected for 2019. The cost of

controls in this area will continue to be analysed and reduced where possible.

DG BUDG will further invest in improving its internal control systems following the

revision of the Internal Control Framework and in achieving an effective monitoring of

ongoing audits and the resulting recommendations.

DG BUDG Anti-Fraud Strategy will be reviewed during 2019 and will cover the

recommendations derived from the IAS audit in the 'Performance and Coordination of

Anti-fraud activities in the Traditional Own Resources' (see specific objective 3). It will

also reflect the efforts made to improve the cooperation with the other concerned

services, TAXUD and OLAF.

A revision of the sensitive posts will be carried out at DG level before the year end.

The area on Data Protection has grown in importance and in the amount of work needed

as the new regulation on data protection 45/2001 will enter into force on 11 December.

DG BUDG has been working well ahead before the entry into force of the regulation not

only to ensure compliance but also to be able to show compliance to the data subjects

wanting to exercise their rights. In BUDG, a stock taking exercise has taken place and an

exhaustive inventory of all the personal data processing taking place in the DG is now

available. An action plan has been defined to ensure full compliance with the regulation.

Work will continue very intensively during 2019.

C. Information management and communication

Document management

All incoming and outgoing documents are registered and filed in Nomcom files.

Procedures are in place to follow up on the correct and timely attribution and filing. 93%

of DG BUDG files are readable by all units; the other 7% have a more restrictive nature

and are only accessible by the stakeholders.

In line with the strategy on "Data, Information and Knowledge Management" DGs and

services are encouraged to share information and promote collaborative working. To that

end, Ares files visibility was reviewed and 39% of all files created since 2017 are

accessible to the whole Commission. All files have a retention code metadata to ensure

the correct follow up in terms of archiving and accessibility at the long term.

As part of the administrative efficiency’s improvement, we will clean the archive rooms

which is still containing unregistered paper in Ares (before 2009) that have not yet been

transferred to the historical archives. About the future paper archives (reduced volume

thanks to the tool Ares), we would like to implement a better structure of the metadata

transposed into the archives room waiting for the date of their transfer to the historical

archives (labeling, files inventory, ...) and this to allow the people in charge of their

transfer an easier sending process.

We started also this year to review and simplify DG BUDG's filing plan. The scope is to

make the filing system in ARES an even more useful tool for retrieving and sharing

information throughout the DG and within the Commission. The filing plan should be

elaborated in a way that the activities of the DG are reflected in a structured way and

information is retrievable and understandable, also for outsiders.

In order to facilitate this work, we suggest some suggestions as:

Changing from annual to multi-annual files;

Deleting redundant files;

Merging low volume files;

budg_mp_2018 17

Rigorously closing and archiving old files.

Use the same structure for other storage: unit common drives, paper files

Internal communication activities

Internal communication will continue to focus on staff motivation and commitment to DG

BUDG mission and the Commission’s political priorities. My BUDGnet will become more

journalistic / editorial with a Mobile application to ease access to the information outside

the working place. Exploring the results of the 2018 internal DG BUDG survey and DG HR

Staff Survey, managers at all levels will play an important role especially in improving

knowledge management, sharing information and providing feedback to staff, who is

encouraged to take part in communication activities.

Interactive communication between staff and management to enhance trust and mutual

understanding will be supported through regular DG BUDG Management video readouts,

regular all-staff meetings and Director-General´s informal gatherings with staff and

lunch-time presentations and seminars, covering issues within the remit of DG BUDG as

well as issues of general interest related to the future of Europe. Through these channels,

as well as through regular directorate´s, unit or individual meetings, staff will be kept

abreast of the challenges facing the Commission and DG BUDG in particular, such as the

negotiations and of the post-2020 MFF proposal. Daily Media review will provide all staff

with fresh budget related news.

Communication and cooperation among DG BUDG directorates and units will be

promoted on BUDGnet and through staff lunchtime conferences/workshops. The use of

collaborative

D. External communication activities

DG BUDG external communication in 2019 will continue to focus on the main milestones

identified in the Roadmap for a More United, Stronger and More Democratic Union, in

particular on the added-value of the EU budget and on the way the EU budget helps

to address the urgent challenges Europe faces.

DG BUDG will work with other Commission´s services in order to coordinate the

communication of the post-2020 Multiannual Financial Framework with the aim

to maintain unity of messages, to find synergies and pool resources. This should lead,

step by step, to the definition of clearer corporate narratives per budgetary headings

and 17 policy clusters as well as distinctive visual branding. Based on the country-specific

information prepared for the MFF proposal in May 2018 new fiches will be prepared in

collaboration with DG COMM, highlighting the key questions relevant for each Member

State.

Demonstrating concrete results achieved thanks to EU budget through the "EU Results"

web project database8 will help to support budget related narratives with information

on budget performance and concrete achievements. DG BUDG will ensure that the data

base is enriched and used across the Commission in the corporate and sectorial

communication activities.

Presentation of the Integrated Financial and Accountability Reporting will

contribute to ensuring that the discharge is granted.

Interactive ways of presentation will prevail over traditional paper-based publications.

Apart from high quality complete information for experts and interested stakeholders,

simplified information material in the form of factsheets, brochures, and videos will be

available to explain the complexities of EU budget and its impact on the daily life of

European citizens9.

8 http://ec.europa.eu/budget/euprojects/search-projects_en 9 http://ec.europa.eu/budget/mycountry/

http://ec.europa.eu/budget/euprojects/search-projects_en

http://ec.europa.eu/budget/mycountry/

budg_mp_2017 18

Some planned activities of external communication in 2019:

Communicating the results achieved with the current MFF;

Ensuring communication activities in relation to the next MFF, negotiation, adoption,

preparing the ground for implementation as from 2021;

Contributing to the harmonization of the visibility and communication requirements

across the EU budget programmes

Collaborative spaces will continue to be explored as part of the internal communication

strategy in order to find the most effective way to store and share information inside DG

BUDG.

Other publications in http://ec.europa.eu/budget/biblio/publications/publications_en.cfm

http://ec.europa.eu/budget/biblio/publications/publications_en.cfm

budg_mp_2018 19

ANNEX 1. TABLES WITH MAIN POLITICAL OUTPUTS AND INDICATORS

PART 1. MAIN OUTPUTS FOR THE YEAR

Specific objective 1: Drive the process of strategic budgetary planning: Ensure

full implementation of the MFF, upgrade short, mid and long term financial

forecasting, and facilitate the timely adoption of the MFF 2021-2027

Main outputs in 2019:

Output Indicator Target

Facilitating timely negotiations of the

MFF agreement

under the Romanian and Finnish Council Presidencies

Timeline of the European Council meetings, conlusions and

agreement on the next MFF

Political agreement on the 2021-2027 MFF in 2019 allowing for the

next generation of spending

programmes to effectively take off as of 1/1/2021.

Commission contribution to European Council meetings on the MFF

Results of European Council Meetings on the MFF

Progress reflected in the Sibiu Declaration and Conclusions on the MFF package by the European Council

Long-term forecast report(planning, monitoring and forecasting -Art.247.1(c) FR

Define and update scenarios for the future 5 years on the annual revenue projections and payment needs for all MFF (sub-) headings and regularly inform the budget authority.

Manage the MFF on the basis of sound and regularly updated long-term forecasts and provide relevant information for the decision-making process on future annual budgets and the MFF 2021-

2027 on annual basis.

budg_mp_2017 20

Specific objective 2: Manage the expenditure of the EU budget efficiently within the

framework of the MFF: Ensure the adoption of annual budgets within the set

deadlines that respond to the political priorities within the MFF.

Make sure that budgetary implementation is in line with the annual budget and

responds to an efficient use of resources. Allocate Resources to Commission services

according to needs and promote efficiency



Establish an annual budget for 2020 according to needs within legal deadlines respecting the

political priorities

1. Difference between the Draft Budget (DB) and authorized budget 2. Timely adoption of estimates and DB

for 2020

3. Timely adoption of amending letters & amending budgets aligned with political priorities

4. Technical update of 2020 financial programming after adoption of 2019 Budget

1. Difference < 1% 2. Commission adopts estimates of

expenditure by legal deadline

3. Budget 2020 adopted by EP and Council before the end of 2019. All amending budgets approved by the budget authority by mid December 2019

4. Update sent to EP and Council by end-January 2019

Allocate Human

Resources to Commission services to promote efficiency and alignment to political priorities

Decision consistent with occupation of

the establishment plan, corresponding salary credits and Commission policy orientations (new mandate, new MFF)

Decisions in parallel with DB, and

December 2019 to reflect priorities of incoming Commission. Pro-active monitoring of efficiencies.

Assess budgetary implications and ensure sound

budgeting within the MFF for new legal acts/Commission decisions; Align the IT tools to the new business needs;

1. Interservice consultations (ISC) processed on time

2. Alignment of IT environment to the modified budgetary structure for the next MFF

1. At least 95% of replies to ISC within normal ISC deadline

2. New development of BadgeBud available by end 2019 (for the launch of the 2021 budget procedure).

Annual budget implementation making use of

transfers and carryovers

Degree of annual budget implementation

Number of transfers accepted by the budgetary authority Timely adoption of the justified carryover requests

Full implementation making use of transfers and carryovers

Budgetary Authority approves all transfer requests; Decision taken by 15/2/2019

Regular monitoring and control of decentralised agencies resources

Timely production of the working document on agencies, which accompanies the draft budget

Working document on agencies published together with DB 2020 Assessment of scope for increased fee-financing in next MFF

budg_mp_2018 21

Specific objective 3: Efficiently and effectively manage and control the revenues of

the EU budget, in particular the Union's own resources.

Follow-up and take active part in the legislative process on future own resources



Follow-up and take active part in the legislative process on future own resources

Participation/contribution to meetings of the Council working party on own resources and of the EP relevant fora

Provide timely input in order to come to a timely agreement on the 2021-2027 MFF

Participate pro-actively in the

interinstitutional negotiations; establish revenue reform as a

constitutive element of the overall agreement.

Degree of convergence between Member States on some key elements of revenue

reform. Progress in the NegoBox process.

Timely agreement on own resources reform as part of the

overall agreement on the Multiannual Financial Framework.

Effective management

of Member States' own resources payments

1. Timely and accurate collection of OR

contributions and related payments 2. Opinion of the Court of Auditors

1. 100%

2. Positive opinion

Management of VAT exemption pursuant to PPI (Protocol of

Privileges and Immunities)

Timely and accurate recovery of VAT paid by the Commission services

All annual refund requests to be sent by 30/06/2019

Control of the Union's traditional own resources (TOR)

1. Implementation and reporting of TOR inspections in accordance with the annual programme; 2. Timeliness of assessment of Member

States' write-off reports and related financial impact

1. 100% 2. All irregular TOR write-off

amounts are made available to the EU budget

Control of VAT-based own resources: Reasonable assurance

that Member States’

VAT statements are correct and comply with OR regulations

Degree of completion of agreed programme of inspections

100%

Establishment, in close co-operation with Eurostat, of GNI-based own resources

Agreement by the Member States in the November GNI Committee, for the calculation of annual VAT/GNI balances

Agreement reached on time

Calculation of Own Resources basis

Approval in the ACOR meeting Approval obtained on time

Calculation of UK rebate

Approval in the ACOR meeting

Approval obtained on time

budg_mp_2017 22

Specific objective 4: Maintain a high quality central accounting / financial framework

so as to deliver true and fair annual accounts, as well as to provide reliable and

relevant financial and performance information to all stakeholders so as to

demonstrate the Commission's accountability



Publication of the Commission and consolidated Annual accounts of the EU budget

1. Timely adoption by Commission 2. Positive DAS on annual accounts from ECA

1. Adoption: 30/6/N+1 2. Maintain the positive DAS on annual accounts

Annual Accounts of all

entities under the responsibility of the Accounting Officer of the

Commission

1. Timely adoption by relevant

authorities 2. Positive DAS on annual accounts

from ECA

1. Adoption: 30/6/N+1

2. Maintain the positive DAS on

annual accounts

Integrated financial and Accountability reporting

2018 in order to improve the consistency of reporting on Budget performance

1. High quality and readable report, with a positive impact on discharge

discussion

1. Publish the Integrated financial and Accountability reporting which

includes: EU Annual Accounts Annual Management and

Performance Report (AMPR) which provides a comprehensive narrative and

examples on the performance

of the EU Budget and includes information on the protection of the EU Budget

Cashflow information The annual internal audit

report

Report on the follow-up to the discharge for the 2017 financial year

Programmes’ Performance Overview

Transmission of the individual reports to EP, Council and ECA by 30/6-N+1

budg_mp_2018 23

Specific objective 5: To support the Commission services and other bodies in the

implementation of the EU budget via effective treasury management, timely execution

of all payments , efficient collection of revenues and maintenance and development of

a secure and high quality Information System (ABAC)



Efficient and effective Treasury Management and safekeeping of funds

1. Lack of cash resources has no impact on the processing of authorised payments 2. Execution of payments within one day after authorisation.

3. Regular availability of cash forecasts at short and medium term 4. Losses on bank balances

5. DAS on the treasury tasks

1. No payments authorised are delayed due to lack of cash 2. 98% of all payments

3. Daily update for very short term and weekly for monthly forecasts 4. losses on bank balances = 0%

5. Positive DAS Ensure the budgetary financial year transition

Timely opening in ABAC of the budget year ( appropriations + RAL)

Interruption of payment operations not to exceed 7 days.

Complete carry-forward expenditure by 14 January

Efficient and effective Recovery and Fines Management

Number and amount of open recoveries, at the end of 2018 in pre-litigation phase and due for

more than six months. % of coverage of the fines and safeguard of the related financial assets in accordance with the

applicable risk management policy Go-live of IT Tool (FINE) aiming to improve efficiency and control

Open recoveries at pre-litigation phase and due for more than six months below 20% of the total

number and below 10 % of total amount of open recoveries at pre-litigation phase. 100 %

Final delivery 1st quarter 2019

Validation of local systems 1. Timely evaluations according to the Work Programme

2. Provide reasonable assurance that local systems transmit accurate, complete and timely

information to draft the annual accounts and produce reliable reporting, both for management and regulatory compliance purposes.

3. Multiannual validation cycle

4. Annual Report on Validation of Local Systems for ensuring

financial data quality

1. Completion of the validation engagements in accordance with the Work Programme at year end

2. Supervisory checks on all Commission services and EU bodies under the responsibility of

the Accounting officer. Calculation of risk score.

3. Conduct validation engagements in each Commission service at least once every four years.

4. The conclusions of the validation activities carried out

during the year will be summarised in an annual report, to be prepared in the first quarter of the next year (N+1).

budg_mp_2017 24

Specific objective 5: To support the Commission services and other bodies in the

implementation of the EU budget via effective treasury management, timely execution

of all payments , efficient collection of revenues and maintenance and development of

a secure and high quality Information System (ABAC)



Ensure that the ABAC services are regularly and timely available within reasonable costs and efforts

1. Number of incoming ABAC requests at the helpdesk are closed within 4 hours 2. Availability of ABAC

1. > 80% 2. Up time of ABAC > 95%

Continuous alignment of

ABAC to budgetary, accounting and legal requirements, new business needs (e.g. new agencies),

and corporate IT infrastructure evolution.

1. System developments should

be limited to the purpose of evolutive and corrective maintenance, unless having a clear added value for the new

system SUMMA. 2. ABAC deployment for agencies and other external entities on the date mentioned in the relevant

SLA unless subsequently requested otherwise by concerned external entity and agreed by BUDG.

3. Alignment of ABAC system to IT infrastructure requirements

1. Non-maintenance system

developments = 0.

2. Number of days deviating from the date agreed in the SLA = 0.

3. End of 2019 unless specified otherwise

Implementation of the new Corporate Finance Platform SUMMA to maintain a modern and high quality

Information System

1. The Solution Design phase results in a list of functional specifications describing the enhancements/gaps to be built on

S/4HANA. 2. The Solution Build phase starts

3. The exact integration of SUMMA with the other corporate tools, especially eProcurement, is clarified between DG DG BUDGand DIGIT.

1. The backlog of enhancements/gaps (with a prioritisation and cost estimate) is signed off by Management in

multiple batches with completion in September 2019. 2. The Solution Build phase starts in Q2 2019

3. The detailed business scope of SUMMA versus eProcurement is documented and presented to the GPSB (Grants & Procurement Board) and SUMMA Steering

Board for approval by September 2019

budg_mp_2018 25

Specific objective 6: Promote consistency and simplification of the financial rules,

sound financial management and cost-effectiveness of controls



Contribution to the preparation of the 2021-2027 MFF

1. Negotiation of the new spending programmes

2. Protection of the budget in case of generalised deficiencies as regards the rule of law in Member States

1. Support the lead DGs 2. Negotiate and reach an agreement as

part of the MFF 2021-2027 package;

Implementation of Financial Regulation 2018

1. Implementing the revised rules on conflicts of interest in the Financial Regulation 2018

2. Other regulatory alignments

1. Complete an overview of national implementation measures and promote exchange of best practices among Member States

2. Align:

- the Financial Framework Regulation on decentralised agencies,

- the Model Financial Regulation for public-private partnerships,

- the EDF Financial Regulation

- the Financial and Administrative Frameworks Agreements with Commission implementing partners

Lead and modernise the financial community

1. Promote simplification, coherence and sound financial management within the existing legal framework

2. Implementation of the strategy for SEDIA (single financial portal), eProcurement and eGrants

3. 3.Functioning of the Early Detection and

Exclusion System merger with the financial irregularities Panel

4. 4. Support to the DGs for the

implementation of the new Internal Control Framework and for the annual reporting and risk assessment

5. 5.Sponsor of financial community:

- - Financial networks meetings.

- - Training of financial staff and management

- - Updated models, templates, guidance and repositories

- - Proactive information

6.Develop knowledge management tools

1.1 Use of simplification tools in funding programmes; 1.2. Timely and relevant reply to Inter-Service Consultations, 1.3.SFC helpdesk questions and Advice

on the application of the Financial Regulation 2.Support expansion of SEDIA and eGrants; finalise OPSYS pilot building on corporate eProcurement

3.Increase awareness, use and guidance of EDES in line with internal audit recommendations

6. 4.Regular exchanges with/among services; consistent and comprehensive accountability annual reporting issue in

line with the instructions and guidance

5.1 Peer review of the Annual Activity Reports and of critical risks 5.2.Positive feedback on quality of

services: -Training on ABAC, EDES, grants, procurement, internal control - RUF, Internal Control Coordinators. - Updated model contracts, grant agreements, contribution agreements,

call for tenders and for proposals and other legal documents or correspondence;

- Updated pages in BUDGWEB, newsletter 6.Use KOEL to streamline and facilitate

access key financial information)

budg_mp_2017 26

Specific objective 7: Ensuring that performance is at the core of EU spending



In-depth

programme performance analysis

1. In-depth spending programme

analysis with focus on European added value

1.1 Key performance issues identified

and discussed in the draft budget process. Programme statements annexed to the DB 2020 1.2 New framework in place for in-depth

analysis of specific EU spending programmes by end 2019

Performance

reporting and communication

1. Streamline and make more accessible

the reporting instruments

2. Resume dialogue with our main stakeholders regarding performance

1. Publication of an interactive online

overview of programme statements by end 2019

2. Ensure that Budgetary authority and stakeholders develop a common understanding of the Commission approach to EU Budget performance

Developing the 2021-2027 MFF performance

framework

1. Co-Lead of Inter-Service Working Group on monitoring and evaluation

1.1 Develop a Monitoring & Evaluation framework including relevant indicators for each spending programme to be

operational by the start of the new programming period.

1.2 Provide continued support to DGs during the MFF negotiations to ensure coordinated approach and safeguarding

of established performance framework principles

budg_mp_2018 27

Specific objective 8: Ensure effective management of the relations with the European

Court of Auditors, the EP's Budgetary Control Committee (CONT) and the Council

paving the way to the Commission's annual discharge.

Coordinate follow up to the recommendations of the Court of Auditors, the EP and the

Council.

Provide a forum for the exchange of good practice on key Internal Control challenges

and practices in Member States.

Provide coaching, monitoring and reporting of progress with Public Internal Financial

Control and External Audit reforms in enlargement and neighbourhood countries.



EP grants 2017

Discharge Discharge resolution adopted Adoption by EP plenary in March

2019

Reply to ECA annual report for the financial year 2018 (Art. 258(1) FR); Reply to ECA Special Reports (Art. 259(1) FR)

Timely delivery of quality replies to ECA annual report & Timely delivery of quality replies to ECA Special reports.

Annual Report: Legal deadline for the replies is 15/10/2019. However, in order to allow the ECA to publish its Annual report in September/early October, replies should be

transmitted to ECA mid-August 2019. Special reports: The procedure should be completed in 6 weeks.

Maintain constructive

relations with the ECA

Timely support to discharge

correspondents

- Smooth cooperation with the ECA on a possible new approach for the annual Statement of Assurance (DAS)

- Early identification of ECA sensitive

performance audits - Facilitate exchange of views between the ECA and discharge

correspondents - Development of RAD for a more effective follow-up of ECA recommendations

- Reach a common understanding with the ECA on a revised approach

Relaunch the PIC

Network, in line with a strategic approach based upon identified Member State interest

Member State support for, and

participation in, EU-wide PIC Conference.

Discussion input to PIC Conference

to be provided/endorsed

Provide technical guidance on PIFC and External Audit standards to candidate, potential candidate and relevant ENP countries, and

provide assessment of reform progress (in line with Stabilisation and Association Agreement

or Association Agenda)

Provision of reasoned guidance on PIFC/External Audit policy documents and draft laws. Input and technical analysis are provided to NEAR and EEAS on PIFC

and External Audit. Measureable achievements of PIFC implementation and for External

Audit reform.

Timely provision of such guidance upon the countries' requests. Participation, or provision of DG BUDGposition, in one formal Commission monitoring meeting per year

Participation in Regional Seminar on further implementation of the principle of Managerial Accountability

Pertinent information on PIFC/External Audit is included in

Progress and Monitoring Reports

budg_mp_2017 28

PART 2. MAIN ORGANISATIONAL MANAGEMENT OUTPUTS FOR THE YEAR

A. Human resource management and organisational aspects

Objective: The DG deploys effectively its resources in support of the delivery of

the Commission priorities and core business, has a competent and engaged

workforce, which is driven by an effective and gender-balanced management

and which can deploy its full potential within supportive and healthy working

conditions.



Sound allocation of human resources ensuring effective and

efficient operation of the DG

Occupation rate of posts in the DG > 95%

Flexibility of staff and building bridges across the DG

Number of "working together" traineeships per year

Horizontal working groups

≥ 10

According to needs

Internal mobility favours the

efficient and effective operation of the DG through increased motivation and broadened experience of staff, while ensuring continuity of service

Internal mobility rate (%)

≥5%

High satisfaction rate enhances engagement and motivation of staff

Average satisfaction rate of DG BUDG staff ( Commission Staff Survey)

Perception of DG BUDG staff of balance between private and professional life

≥ 70%

≥ 60%

Implementation of the Action plan to the DG BUDG Staff

Survey

% of actions planned for 2019 implemented

100%

Promotion of equal opportunities % women in management positions ≥40%

budg_mp_2018 29

B. Financial management: Internal control and Risk management

Objective 1: Effective and reliable internal control system giving the necessary

guarantees concerning the legality and the regularity of the underlying

transactions.



Error rate detected on the legality and regularity of the underlying transactions in BUDG

Error rate detected on the legality and regularity of the underlying transactions is below the materiality criteria 2% for administrative budget implementation & below the

materiality criteria 1% for Own

Resources collection

Error rate below 2% for administrative budget implementation Error rate below 1% for Own Resources collection

Objective 2: Effective and reliable internal control system in line with sound

financial management.



Overall costs of controls

Overall costs of controls (%) 1) Administrative expenditure

implementation 2) Own Resources collection

Maintain same levels in AAR 2018 : 1) < 5%

2) < 0.3% (0.28% of OR collected in AAR 2017)

Execution of the

administrative budget Execution rate of the

administrative budget (C1 credits)

>95% of CA

>50% of PA

On time execution of payments

Percentage of payments on the administrative budget made

within the time limits

>95%

Internal Control Systems assessment

Effectiveness of Internal Control Principles (ICAT survey and

specific questionnaires) Participation rate of selected staff in the ICAT questionnaire

>=75%

>=65%

Open

recommendations

from auditors

1. Number of critical/very

important recommendations

overdue for more than 12 months

None

Objective 3: Minimisation of the risk of fraud through application of effective

anti-fraud measures, integrated in all activities of the DG, based on the DG's

anti-fraud strategy aimed at the prevention, detection and reparation of fraud.



Fraud awareness is

increased for target population(s) as identified in the DG’s AFS

Updated anti-fraud strategy,

elaborated on the basis of the methodology provided by OLAF Actions are implemented as described in the Anti-Fraud

strategy

June-2019

100% implementation

C. Information management and communication

budg_mp_2017 30

Objective: Information and knowledge in your DG is shared and reusable by

other DGs. Important documents are registered, filed and retrievable.



DG BUDG Management Video Readout

Regular publication on the next day after management meeting. Overall usefulness of the video for the viewer (DG BUDG internal survey: overall, how useful was this video for you ?)

> 90 %. > 70% of respondent are satisfied

Daily Media review Overall usefulness of the daily media review (DG BUDG internal survey:

overall, how useful is this media

review for you ?)

>70% of respondent are satisfied

Thematic DG BUD Units´ presentations

Number of thematic presentations of DG BUDG Units

Number of participants in each presentation Overall usefulness of the (DG BUDG internal survey: how useful was the presentation for you?)

≥5

> 10

> 60% of participants are satisfied

Important documents

are registered, filed and retrievable

Percentage of registered

documents filed in Nomcom

> 99 %

Access to important documents is guaranteed at the long term

Follow-up on archiving procedure in Hermes Preservation System

Number of files with a retention code in Nomcom

100% of files with retention code

Documents are shared and reusable by other DGs.

Percentage of files accessible to other DGs

At least 40% of the files created in 2019

budg_mp_2018 31

D. External communication activities

Objective: Citizens perceive that the EU is working to improve their lives and

engage with the EU. They feel that their concerns are taken into consideration in

European decision making and they know about their rights in the EU.



Communicating the results achieved with the current MFF:

Integrated Financial and Accountability Reporting

Positive feedback from main stakeholders (source: ECA annual

report, feedback from CONT and DG BUDG)

Overall good

appreciation

MFF post 2020 communication

activities: 1. Create and develop, among others, style guides, factsheets and publication layouts, presentation decks,

illustrations, static or animated infographics, videos 2. Organise info sessions, technical briefings for journalists media seminar for journalist in connection with

Budget autumn conference

1. Graphic & concept give to MFF communication package a recognizable and coherent image.

2. Media outputs from participants of the media seminar.

1.MFF visual branding developed

2. At least 50% of participants to the seminar

1. EU budget website migration to new Content

Management System

2. EU results

1. Visitor satisfaction rate for the new budget section on ec.europa.eu

Feedback from users based on on-line satisfaction survey.

2. More projects registered in EU Results live version, more projects made visual on the projects map (pending IT board decision in 2018), improved Look and feeling (pending

decision on Qlik sense).

1. Majority positive feedback

2. At least 500 more in live version, at least 50000 on the

map.

Annual communication spending:

Baseline (2018) Estimated commitments (2019)

Baseline (2018):

DG DG BUDG budget lines:

200 000 – publications (paper, e-

publications and translations)

5 000 open doors day – conferences,

meetings

270 000 web mastering – Technical

Assistance

DG COMM budget line(s) – see

ARES(2017)354436 as amended in April

2017:

50 000 4rd conference on EU

Finances /MFF

30 000 Public consultation and

events in member States on MFF

post-2020

70 000 MFF post -2020 proposal

communication material

Target (2019):

DG DG BUDG budget lines:

200 000 – publications (paper, e-

publications and translations)

5 000 open doors day – conferences,

meetings

200 000 web mastering – Technical

Assistance

DG COMM budget line(s) – see

ARES(2018)829995:

Post-2020 MFF public events: 50 000

Post-2020 MFF communication material:

50 000

2 Post-MFF related media seminars :

50 000

2 Post-2020 MFF related videos: 50 000

Conference on EU Finances/MFF/BFOR : 50

000

budg_mp_2017 32

ANNEX 2: REPORTING OBLIGATIONS OF DG BUDG(SEE SPECIFIC OBJECTIVE 4)

Reports

Description Legal Basis Timing

INTEGRATED FINANCIAL and ACOUNTABILITY REPORTING 10

Legally required:

Annual Accounts of the EU FR Art 246.5 Adopted by 30/06

Annual Management and

Performance Report ( provide input

to SG)

TFEU Art 318 Adopted by 15/06

FR Art 247

Report on the follow-up to the

discharge for 2017

FR Art.247(1)

and (2)/FR Before 30 June

Art. 262

Integrated Financial and

Accountability Reporting

FR Art. 247 31 July

OTHER REPORTING

Legally required:

Annual budget implementation

reports (Budgetary outturn

accounts)

FR Art.244 By mid-March

Annual Report on Budgetary and

Financial Management FR Art.249 By 31 March

Monthly reports on the

implementation of the budget FR Art.248

Within 10 working days of the

end of each month

Publication of information on

recipients of EU funds through the

Financial Transparency System

(FTS)

FR. Art. 38 Before 30 June

Status report11 FR Art 251 15-Sep

10 DG BUDG Annual Communication package on these reports 11 contains information on current risks noted, general trends observed, new accounting issues encountered,

progress on accounting matters, including those raised by the Court of Auditors, and information on recoveries

budg_mp_2018 33

On-line version 20.07/ Paper -

Sept/Oct

On-line version 20.07/ Paper -

Sept/Oct

Working documents12 accompanying

the yearly Statement of Estimates

of the European Commission

(including a report on Financial

Instruments)

Council

Regulation

608/2014 Art

6(3)

Legal deadline: 01 September

Pragmatic timing: 1-15 June

October

Triennial Report to the EP and the

Council on the functioning of the

inspection arrangements for

traditional own resources

IIA - Point 16 No specific deadline

Annual Report on the EU financial

architecture ( complies information

of 10 different reports)13

Jointly required

by BA and

Commission

February (2015 implementation),

July and October

Non-legally required reports:

Active monitoring and forecast of

budget implementation

Required as WD

(V) to the DB End May

Budget Implementation Plan EP requirement End May

Weekly budget implementation

report EP requirement

From mid-April up until the year-

end on a weekly basis

12 1. Programme Statements of operational expenditure; 2.Commission Human Resources; 3.Bodies set up by

the EU having legal personality and PPP; 4.Pilot projects and preparatory actions; 5.Budget implementation and assigned revenue and evolution of the RAL(Rest a liquider)/PAR(Potential Abnormal Ral); 6.Commission Administrative Expenditure; 7.Commission buildings; 8.Expenditure related to the external action of the EU; 9.Funding of international organisations; 10.Financial Instruments; 11.Payment schedules

13 1. 20176 Consolidated annual accounts of the Union (COM (20172018) 34865 final); 2. Annual accounts of the European Development Fund 20176 (COM (20178) 34764); 3. 2016 Annual reports of the European Financial Stability Facility (EFSF) 4. 2016 Annual report of the European Stability Mechanism (ESM); 5. Report from the Commission to the European Parliament and the Council on borrowing and lending activities

of the European Union in 2015 (COM (2016) 387; 6. Report from the Commission to the European Parliament and the Council on financial instruments supported

by the general budget according to Art. 140(8) of the Financial Regulation as at 31 December 2016 (COM(2017)535);

7. Report from the Commission to the European Parliament and the Council on guarantees covered by the general budget prepared pursuant Art. 149 of the Financial Regulation - situation at 31 December 2015 (COM(2016)576 final);

8. Report from the Commission to the European Parliament and the Council on the implementation of macro-financial assistance to third countries in 2016 (COM/2017/0321);

9. Report from the Commission to the European Parliament and the Council on the Guarantee Fund for external actions and its management in 2016 (COM (2017)488 final);

10. Working document part XI - EU Trust fund - accompanying the DB 2018. In addition, the Commission reports on a monthly basis to the European Parliament and the Council on the budgetary implementation of the EU Trust Funds and the Facility for Refugees in Turkey.

budg_mp_2017 34

Implementation of structural funds

reports EP requirement Quarterly

Report on the implementation of EU

Trust Funds and the Facility for

Refugees in Turkey

EP requirement Monthly

Report on the implementation of

funding related to the migration

crisis (2015-2017)

EP/COU

discharge

request

Monthly