EU agencies stained by ‘conflicts of interest’, wrongdoing

EEA facade.jpg

The European Parliament is set to suspend its approval for the 2010 budget of three EU agencies due to expenditures which appear unjustified, according to the lawmaker in charge of the dossier.

The European Parliament is “expected to withhold approval for the European Environment Agency (EEA), the European Food Safety Authority (EFSA) and the European Medicines Agency (EMA),” reads a note issued yesterday by the EU Assembly.

The decision is expected to be taken during a plenary session Thursday (10 May) that will discuss the 2010 budgets for the 24 EU agencies and decentralised bodies.

Monica Macovei, the Romanian Conservative MEP in charge of the dossier, will propose postponing the Assembly's approval for the budgets of the three agencies.

Conflicts of interests and revolving doors

Macovei told EURACTIV that an announcement yesterday by Diána Bánáti – until then the chairperson of EFSA's management board – that she was moving to ILSI, a food and agro-chemical industry-funded body, served to underline the problem with conflicts of interest.

The original reason for delaying the discharge in relation to EFSA included a previous issue involving Bánáti who “did not mention in her declaration of interest that she was also on the board of ILSI-Europe," last October. 

Bánáti stepped down from ILSI-Europe “after the situation was denounced by MEP José Bové” at that time, remaining as the chairperson of EFSA’s management board. Today she announced that she is now leaving EFSA for ILSI, where she will become director. EFSA issued a statement afterwards explaining that she would be leaving.

Members of the EFSA panel on genetically modified organisms (GMOs) – over which Bánáti had powers of supervision – are in charge of authorising or banning GMOs on the EU territory, and are accused of having maintained tight links with the GMO industry, notably Monsanto and Syngenta.

“This moving back and forth between a safety authority and industry fails to provide the public that their actions are in the interests of consumers,” said Macovie. She added that Bánáti’s switch the day before the vote ought to help her persuade Parliament to block the discharge.

Meanwhile, a number of members and experts of the European Medicines Agency are also accused of having maintained too close contacts with the pharmaceutical industry.

“We have worked with Mrs Macovei’s office over the past months and responded to her on all the points raised during discussions. Despite all this we are disappointed to see that she continues to recommend postponement of the discharge for 2010,” said Martin Harvey of the EMA.

The executive director of the European Environment Agency, Jacqueline McGlade, is cited for financial wrongdoing and compromising links with Earthwatch, an environment organisation which has received funding from the EEA.

In time of crisis, hefty expenses

EFSA and EEA also stand accused of dubious expenses. EFSA’s board meetings cost an average of almost €100,000 each. In other words, when the agency's 15 members hold a meeting, this is costing EU taxpayers over €6,000 per person. This is “nearly three times higher than the second most expensive management board of a decentralised agency,” argues Macovei.

But probably the heaviest dossier on financial wrongdoing is about the EU environment agency. Trips to touristic resorts were reported as work travels by agency members, and donations and public procurement contracts are under investigation by EU authorities.

Other expenses at the agency appear questionable, like the €300,000 or so spent by the agency to redecorate the facade of its Copenhagen headquarters with greenery (see photo). The contract was also awarded without a tender, Macovei argues.

The agency has also subscribed a contract for media monitoring services with a financial ceiling of €250,000 in four years, which could cost the agency up to €60,000 a year. “This is excessive and contrary to the principle of efficient use of the taxpayers' money,” the MEP remarks.

Contacted by EURACTIV, the EEA said it had spent only €11,300 on media monitoring per year because the ceiling has never been reached. As for the facade, the agency does not deny the cost of redecorating it, but underlined that it followed regular tendering procedures.

The new "living facade" was meant to be “the major communication for the EEA during the International Year of Biodiversity”, the agency claimed. 

The revamp was a success, the EEA argued, as it “gained the interest of architects and city planners across Europe, and was seen by more than half a million visitors in situ and on-line". The living facade "was voted the best tourist attraction in Denmark in 2010,” the agency added.

“Describing the project of the facade the way it has been done till date by some media and commentators is very simplistic. The Green Facade was carried out by a consortium of engineers, architects and the University of Copenhagen to provide an innovative visual communications project. The contract was awarded in accordance with the implementing rules of the Financial Regulation, Art. 126 (1)(b) which covers exclusive artistic and aesthetic skills,” said a press officer of the European Environment Agency (EEA).

As for the accusations on the media monitoring expenses, the press officer added that “there is a misunderstanding. The EEA awarded a framework contract for €250,000, which is the maximum ceiling for a four-year contract. This by no means implies that all this money would be spent on this service. In fact, the EEA has spent an average of €11,300 annually on media monitoring.”

Speaking to EURACTIV, EFSA pointed out that the costs of holding Management Board meetings included live video web-casting of the proceedings, which have reduced the agency's spending. "In 2011 EFSA reduced costs by switching from live video to live audio webcasting of the meetings. In March 2012, the Board further reduced the cost of its meetings, which this year will fall below the average costs of meetings incurred by other EU agencies."

Lucia de Luca, EFSA Media Relations Officer, added that "as part of a cycle of continuous improvement to its policies and procedures, EFSA has put in place a comprehensive series of mechanisms to safeguard the independence of its scientific advice."

In the European Parliament, Socialists and Democrat (S&D) MEPs have stepped forward to defend the EU agencies targeted in the Macovei report, and "urged all political groups to grant discharge to the 24 specialised EU agencies established across Europe" when they hold a vote on Thursday (10 May).

Jens Geier, a German MEP who is the S&D group's spokesman for budgetary control, said: "In our view postponing discharge is a disproportionate political reaction, since Ms. Macovei does not even take the agencies' reactions into account. Additionally she criticises procedures that are beyond the agencies' powers to change." 

"Where it is warranted, we must pinpoint specific issues which need addressing in individual bodies, but not by taking a generalised negative view which risks undermining the reputation and work of all agencies," added S&D budget negotiator Edit Herczog (Hungary).

The Greens group in the European Parliament took a different stance, stressing the need for officials at all EU agencies to prove their independence from private interests.

"The resignation of Ms Bánáti vindicates the European Parliament's efforts to draw attention to and root out conflicts of interest at the EU agencies," Green budgetary control spokesperson Bart Staes MEP said in a statement. "These conflicts of interest are not just limited to EFSA, with the European Medicines Agency being another prime culprit. Agencies like EFSA and the EMA, which deal with the authorisation of goods and items that have direct implications for public health and safety, must act completely independently and any possible conflict of interests with industry must be ruled out."

The Parliament’s budgetary control committee on 26 March authorised the 2010 expenses of the European Commission and the Parliament. However, the committee postponed its green light for three EU agencies: The EU Medicines Agency (EMA), the Environment Agency (EEA) and the Food Safety Authority (EFSA).

They stand accused of a number of wrongdoings. The plenary of the Parliament will vote on their budgets on Thursday (10 May). 

The European Parliament is the guardian of the EU's budget and has the power to postpone or refuse the funds disbursed to a European agency or body if wrongdoing emerges.

MEPs, acting on a recommendation of the EU Council of Ministers, base their decision on a review of the accounts and the Court of Auditors’ annual report. They may also recommend that the European Commission take action on certain matters. The Commission then details its response in a follow-up report and action plan, which it sends to the Parliament and Council.

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