European Scrutiny Committee Meeting Summary: 4 December 2013

This week the Committee considered the following documents:

Financial management: audit

For the nineteenth year the European Court of Auditors has not given a positive Statement of Assurance on the reliability of the EU’s accounts.  The ECA reports that for the third year running the error rate for payments has increased, and that errors were identified in all categories of payment assessed, with rural development, environment, fisheries and health the most error prone.  While some improvements have been made, particularly relating to assurance on revenue and commitments transactions, this is clearly a matter of ongoing concern.  The Committee recommends that the Court of Auditors’ Report, along with a related Report on the European Development Funds, should be debated in European Committee before the ECOFIN Council in February 2014 (with the previously-referred Commission Fight Against Fraud Annual Report) .  Our conclusions note that when we referred these documents last year (and the year before) the Government scheduled the debate– pointlessly – months after the Council’s adoption of its discharge recommendations. We hope that this will not be the case for these Reports.

Regulation of tobacco and related products

The Committee has recommended this Draft Regulation for debate in European Committee, and wrote last week to the new Minister expressing concern about the delay in scheduling the debate.  The Minister has written apologising for the delay and setting the date as Monday 16 December at 4.30pm.  She looks forward to explaining the progress of negotiations in greater detail.  We have received correspondence expressing concerns about the closed nature of the trilogue process on this document.  Our conclusions note the significant different in approach towards the regulation of e-cigarettes taken by the European Parliament and the Council and the absence, so far, of any indication as to how this difference can be bridged.  We ask the Minister to report back on the outcome of the trilogue negotiations which took place on 3 December, and make clear that further information on the scope of the compromises being considered, as well as the factors that the Government will take into account in determining whether an acceptable compromise can be reached, is imperative to inform the European Committee debate.

Banking Union: Single Resolution Mechanism

This autumn, two Regulations establishing a Single Supervisory Mechanism, the first pillar of the Banking Union, were adopted. In July 2013 the Commission proposed the Regulation currently under scrutiny to establish, as the second pillar of the Banking Union, uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms, a Single Resolution Mechanism.  The Committee considered the proposal in September and noted that although it would not apply directly to the UK, it would have implications, perhaps significant, for the UK’s financial services industry.  We asked the Government for an update on negotiations and requested answers on a number of legal issues.  We consider this week the Minister’s very belated response (received the evening before our meeting), and an Opinion on the proposal from the European Central Bank.  The Minister asked us to clear the document from scrutiny so that the Government could agree to a general approach, if it deemed it appropriate, if the matter came before the ECOFIN Council on 10 December.  Given the lack of time for proper analysis we do not clear the document and advise the Minister that given the importance of the issues at stake we will expect the Government not to support any proposal which comes to ECOFIN next week, and – further – will regard an abstention as merely a token regard for parliamentary scrutiny.

Reducing plastic carrier bag use

This Draft Directive requires Member States to take measures to reduce the consumption of lightweight carrier bags.  The Commission states that the consumption of such bags has continued to increase and notes that the Environment Council invited it to analyse possible action in March 2011.  The proposal would require Member States to take measures to reduce within 24 months the consumption of plastic bags having a thickness of less than 50 microns (0.05mm) but does not set a specific reduction target, simply requiring that account should be taken of the current consumption level in individual Member States.  The Government points out that Wales and Northern Ireland have already introduced charges of all single use bags at point of sale, extending beyond the lightweight carrier bags covered by this proposal, notes that the Scottish Government has announced that it will be introducing a charge in 2014 modelled on the approach in Wales, and that it has itself announced an intention to introduce a charge on plastic bags in England in 2015.  It therefore does not believe that the UK would need to make significant changes to comply.  Taking this into account, we clear the document, while questioning its utility.

EU Development Policy and Financing post-2015

An earlier Commission Communication, A Decent Life for All: ending poverty and giving the world a sustainable future, set out the Commission’s view on the international post-2015 development agenda: ending poverty and ensuring that future prosperity and well-being are sustainable.  The debate already recommended by the Committee on this Communication is to be held in European Committee B on 12 December.  We report this week on a subsequent Commission Communication Beyond 2015 — towards a comprehensive and integrated approach to financing poverty eradication and sustainable development, and recommend that it is debated along with the first Communication ahead of the December "development" Foreign Affairs Council.

Other documents reported

We are also reporting on documents relating to:

• Business, Innovation and Skills: Posting of workers; European Social Fund;
• Environment, Food and Rural Affairs: Sharing of benefits from genetic sources; 
• Foreign and Commonwealth Office: EU Operations centre and the Horn of Africa; EU-Georgia; EU-Syria and the Organisation for the Prohibition of Chemical Weapons; Comitology;
• Health: Clinical trials; 
• HMRC: Customs; 
• HM Treasury: Remuneration and pension adjustments for EU staff in 2013; Stability and Growth Pact: excessive deficit procedure
• Home Office:  Regulation of new psychoactive substances; 
• International Development: Financing post-2015 development (jointly with DECC and Defra); European Voluntary Humanitarian Aid Corps; 
• Transport: Alternative fuels; Moveable assets; Renewable energy: use of biofuels in transport;

The Report will be available on the Committee's publication webpages.  The Committee’s Twenty-fifth Report will also be published shortly, covering:  Commission Work Programme; Europe for Citizens Programme 2014-20; Fisheries: total allowance catches for 2014; EU Passenger Name Record (PNR) Agreement with Canada; Vehicle type approval: sound levels of motor vehicles;Accession of the Yemen to the WTO; Regulating collecting societies; Damages in competition law; Electronic procurement and invoicing in public procurement; Roma integration; “Europe for Citizens” Programme 2014-20; European Earth Observation Programme ("Copernicus"); Barcelona Convention; Cultivation of genetically modified maize; EU Cooperation with Egypt in the field of Governance; VAT; EU Readmission Agreement with Azerbaijan; Croatia’s accession to the EU/Switzerland Agreement on the free movement of persons; Brussels I Regulation and the Unified Patent Court; Rights and Citizenship Programme 2014-20; Access to documents.