Annexes to COM(2023)74 - Providing macro-financial assistance to North Macedonia - Main contents
Please note
This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2023)74 - Providing macro-financial assistance to North Macedonia. |
|---|---|
| document | COM(2023)74  |
| date | July 12, 2023 |
2.2.3.Estimation and justification of the cost-effectiveness of the controls (ratio of "control costs ÷ value of the related funds managed"), and assessment of the expected levels of risk of error (at payment & at closure)
The control systems in place, such as the ex-ante operational assessments or the ex-post assessments, ensured an effective error rate for the MFA payments of 0%. There are no known cases of fraud, corruption or illegal activity. MFA operations have a clear intervention logic, one that allows the Commission to evaluate their impact. The controls enable the confirmation of assurance and of attainment of policy objectives and priorities.
2.3.Measures to prevent fraud and irregularities
Specify existing or envisaged prevention and protection measures, e.g. from the Anti-Fraud Strategy.
To mitigate the risks of fraudulent use several measures have been and will be taken:
First, the Loan Agreement will comprise a set of provisions on inspection, fraud prevention, audits and recovery of funds in case of fraud or corruption. It is further envisaged that a number of specific policy conditions will be attached to the assistance, including in the area of public finance management, with a view to strengthening efficiency, transparency and accountability. Also, the assistance will be paid to a specific account of the Central Bank of the partner.
Moreover, in line with the requirements of the Financial Regulation, the Commission services have carried out an Operational Assessment of the financial and administrative circuits of North Macedonia to ascertain that the procedures in place for the management of programme assistance, including MFA, provide adequate guarantees. The assessment was carried out in 2020, and covers areas such as budget preparation and execution, public internal financial control, internal and external audit, public procurement, cash and public debt management, as well as the independence of the central bank. Developments in that area will be further closely monitored by the EU Delegations in the respective partner. The Commission is also using budget support assistance to help the respective partners improve their PFM systems, and these efforts are strongly supported by other donors.
Finally, the assistance will be liable to verification, control and auditing procedures under the responsibility of the Commission, including the European Anti-Fraud Office (OLAF), and the European Court of Auditors as foreseen by Article 129 of the Financial Regulation.
3. ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE
3.1.Heading(s) of the multiannual financial framework and expenditure budget line(s) affected
·Existing budget lines
In order of multiannual financial framework headings and budget lines.
| Heading of multiannual financial framework | Budget line | Type of expenditure | Contribution | |||
| Number | Diff./Non-diff. 17 | from EFTA countries 18 | from candidate countries 19 | from third countries | within the meaning of Article 21(2)(b) of the Financial Regulation | |
| 15.020203 | Diff. | NO | NO | NO | NO |
·New budget lines requested – Not applicable
3.2.Estimated financial impact of the proposal on appropriations
3.2.1.Summary of estimated impact on operational appropriations
–◻ The proposal/initiative does not require the use of operational appropriations
–X The proposal/initiative requires the use of operational appropriations, as explained below:
EUR million (to three decimal places)
| Heading of multiannual financial framework | 6 | Heading 6 - 'Neighbourhood and the World' |
| DG: ECFIN | Year 2022 | Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL | ||
| • Operational appropriations | |||||||||
| Budget line 20 15.020203 | Commitments | (1) | 9 | 9 | |||||
| Payments | (2) | 9 | 9 | ||||||
| Appropriations of an administrative nature financed from the envelope of specific programmes 21 | |||||||||
| Budget line 14.20.03.01 | (3) | 0.15 | 0.15 | ||||||
| TOTAL appropriations for DG ECFIN | Commitments | =1 +3 | 0.15 | 9 | 9.15 | ||||
| Payments | =2 +3 | 0.15 | 9 | 9.15 |
• TOTAL operational appropriations | Commitments | (4) | 9 | 9 | |||||
| Payments | (5) | 9 | 9 | ||||||
| • TOTAL appropriations of an administrative nature financed from the envelope for specific programmes | (6) | 0.15 | 0.15 | ||||||
| TOTAL appropriations under HEADING 6 of the multiannual financial framework | Commitments | =4+ 6 | 0.15 | 9 | 9.15 | ||||
| Payments | =5+ 6 | 0.15 | 9 | 9.15 |
If more than one operational heading is affected by the proposal / initiative, repeat the section above: (EUR million (to three decimal places))
| Heading of multiannual financial framework | 7 | Heading 7 – ‘European public administration’ |
| DG: ECFIN | Year 2022 | Year 2023 | Year 2024 | Year 2025 | Year 2026 | TOTAL | ||
| Human Resource | 0.262 | 0.262 | 0.262 | 0.786 | ||||
| Other administrative expenditure | 0.005 | 0.005 | 0.010 | |||||
| TOTAL appropriations under HEADING 7 of the multiannual financial framework | Appropriations | 0.267 | 0.267 | 0.262 | 0.796 | |||
| (Total commitments = Total payments) | 0.267 | 0.267 | 0.262 | 0.796 |
This section should be filled in using the 'budget data of an administrative nature' to be firstly introduced in the Annex to the Legislative Financial Statement (Annex V to the internal rules), which is uploaded to DECIDE for interservice consultation purposes.
| Year 2022 | Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL | |||
| TOTAL appropriations under HEADINGS 1 to 7 of the multiannual financial framework (Reference amount) | Commitments | =4+ 6 | 0.267 | 0.267 | 0.417 | 9.000 | 9.951 | ||
| Payments | =5+ 6 | 0.267 | 0.267 | 0.417 | 9.000 | 9.951 |
–Estimated output funded with operational appropriations
Commitment appropriations in EUR million (to three decimal places)
| Indicate objectives and outputs ⇩ | Year 2022 | Year 2023 | Year 2024 | Year 2026 | Year 2027 | TOTAL | |||||||
| Type 22 | Number | Cost | Number | Cost | Number | Cost | Number | Cost | Number | Cost | Total number | Total cost | |
| SPECIFIC OBJECTIVE NO 1 23 | |||||||||||||
| - Output 1 | Grant disbursements | ||||||||||||
| - Output 2 | Provisioning of the External Action Guarantee | 2 | 9 | 2 | 9 | ||||||||
| - Output 3 | Ex-post evaluation | 1 | 0.15 | 1 | 0.15 | ||||||||
| Subtotal for specific objective No 1 | - | - | - | - | - | - | 1 | 0.15 | 2 | 9 | 3 | 9.15 | |
| TOTAL COST | - | - | - | - | - | - | 1 | 0.15 | 2 | 9 | 3 | 9.15 |
3.2.2.Summary of estimated impact on administrative appropriations
–X The proposal/initiative requires the use of appropriations of an administrative nature, as explained below:
EUR million (to three decimal places)
| Year 2022 | Year 2023 | Year 2024 | Year 2025 | Year 2026 | TOTAL |
| HEADING 7 of the multiannual financial framework | ||||||
| Human resources | 0.262 | 0.262 | 0.262 | 0.786 | ||
| Other administrative expenditure | 0.005 | 0.005 | 0.010 | |||
| Subtotal HEADING 7 of the multiannual financial framework | 0.267 | 0.267 | 0.262 | 0.796 |
| Outside HEADING 7 24 of the multiannual financial framework | ||||||
| Human resources | ||||||
| Other expenditure of an administrative nature | ||||||
| Subtotal outside HEADING 7 of the multiannual financial framework |
| TOTAL | 0.267 | 0.267 | 0.262 | 0.796 |
The appropriations required for human resources and other expenditure of an administrative nature will be met by appropriations from the DG that are already assigned to management of the action and/or have been redeployed within the DG.
3.2.2.1.Estimated requirements of human resources
–X The proposal/initiative requires the use of human resources, as explained below:
Estimate to be expressed in full time equivalent units
| Year 2022 | Year 2023 | Year 2024 | Year 2025 | Year 2026 | ||
| • Establishment plan posts (officials and temporary staff) | ||||||
| 20 01 02 01 (Headquarters and Commission’s Representation Offices) | 0.171 | 0.171 | 0.171 | |||
| 20 01 02 03 (Delegations) | ||||||
| 01 01 01 01 (Indirect research) | ||||||
| 01 01 01 11 (Direct research) | ||||||
| Other budget lines (specify) | ||||||
| • External staff (in Full Time Equivalent unit: FTE) 25 | ||||||
| 20 02 01 (AC, END, INT from the ‘global envelope’) | 0.091 | 0.091 | 0.091 | |||
| 20 02 03 (AC, AL, END, INT and JPD in the delegations) | ||||||
| XX 01 xx yy zz 26 | - at Headquarters | |||||
| - in Delegations | ||||||
| 01 01 01 02 (AC, END, INT - Indirect research) | ||||||
| 01 01 01 12 (AC, END, INT - Direct research) | ||||||
| Other budget lines (specify) | ||||||
| TOTAL | 0.262 | 0.262 | 0.262 |
XX is the policy area or budget title concerned.
The human resources required will be met by staff from the DG who are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints.
Description of tasks to be carried out:
| Officials and temporary staff | Director Dir. D: Supervise and manage the operation, liaise with Council and Parliament for the adoption of the Decision and the approval of the Memorandum of Understanding (MoU), negotiate the MoU with the authorities of North Macedonia, review reports, lead missions and assess progress with conditionality compliance. HoU/DHoU Dir. D: Assist the Director in managing the operation, liaising with Council and Parliament for the adoption of the Decision and the approval of the MoU, negotiating with the authorities of North Macedonia the MoU and Loan Facility Agreement (together with DG BUDGET), reviewing reports and assessing progress with conditionality compliance. DG BUDGET (Units E1, E3 under the supervision of the Director): Prepare the Loan Facility Agreement (LFA), negotiate it with the authorities of North Macedonia and have it approved by the responsible Commission services and signed by both parties. Follow up the entry into force of the LFA. Prepare the Commission decision(s) on the borrowing transaction(s), follow up the submission of the Request(s) for Funds, select the banks, prepare and execute the funding transaction(s) and disburse the funds to the country. Carry out the back-office activities to follow up the reimbursement of the loan(s). Prepare the corresponding reports on these activities. |
| External staff | Desk economists, MFA Sector (Dir. D): Prepare the Decision and MoU, liaise with the authorities and the IFIs, conduct review missions, prepare Commission staff reports and Commission procedures related to the management of the assistance, liaise with external experts for the operational assessment and the ex-post evaluation. |
3.2.3.Compatibility with the current multiannual financial framework
The proposal/initiative:
–X can be fully financed through redeployment within the relevant heading of the Multiannual Financial Framework (MFF).
3.2.4.Third-party contributions
The proposal/initiative:
–X does not provide for co-financing by third parties
3.3.Estimated impact on revenue
–X The proposal/
–initiative has no financial impact on revenue.
–
(1) https://www.consilium.europa.eu/media/56385/st09459-en22.pdf
(2) https://www.imf.org/en/Publications/CR/Issues/2022/11/29/Republic-of-North-Macedonia-Request-for-an-Arrangement-under-the-Precautionary-and-525935
(3) https://www.consilium.europa.eu/media/43076/26-vc-euco-statement-en.pdf
(4) SWD(2015) 111 final
(5) COM(2022) 528 final
(6) Decision (EU) 2020/701 of the European Parliament and of the Council of 25 May 2020 on providing macro‐financial assistance to enlargement and neighbourhood partners in the context of the COVID‐19 pandemic (OJ L 165, 27.5.2020, p. 31).
(7) Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission's exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).
(8) Council Decision 2010/427/EU of 26 July 2010 establishing the organisation and functioning of the European External Action Service (OJ L 201, 3.8.2010, p. 30).
(9) Regulation (EU, Euratom) No 1046/2018 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union and repealing Regulation (EC, Euratom) No 966/2012 (OJ L 193, 30.07.2018, p. 1).
(10) Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities financial interests (OJ L 312, 23.12.1995, p. 1).
(11) Council Regulation (EC, Euratom) No 2185/96 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission to protect the Communities’ financial interests against fraud and other irregularities (OJ L 292, 15.11.1996, p. 2).
(12) Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 (OJ L 248, 18.9.2013, p. 1).
(13) Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the establishment of the European Public Prosecutor’s Office (‘the EPPO’) (OJ L 283, 31.10.2017, p. 1).
(14) ABM: activity-based management; ABB: activity-based budgeting.
(15) As referred to in Article 54(2)(a) or (b) of the Financial Regulation.
(16) Details of management modes and references to the Financial Regulation may be found on the BudgWeb site: https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx
(17) Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations.
(18) EFTA: European Free Trade Association.
(19) Candidate countries and, where applicable, potential candidates from the Western Balkans.
(20) According to the official budget nomenclature.
(21) Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.
(22) Outputs are products and services to be supplied (e.g.: number of student exchanges financed, number of km of roads built, etc.).
(23) As described in point 1.4.2. ‘Specific objective(s)…’
(24) Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.
(25) AC= Contract Staff; AL = Local Staff; END= Seconded National Expert; INT = agency staff; JPD= Junior Professionals in Delegations.
(26) Sub-ceiling for external staff covered by operational appropriations (former ‘BA’ lines).