Changes from report parliamentary committee draft to plenary report

88. Is concerned about the persistent shortcomings observed by the Court in the work of national audit authorities as visible in the weaknesses identified in the assurance packages, with a residual error rate above the materiality threshold in assurance packages that account for more than 60 % of the total value of assurance packages audited in 2024; stresses with concern that managing authorities consistently do not effectively succeed in preventing or detecting irregularities in expenditure declared by beneficiaries and that this reduces the extent to which the Commission can rely on their work;

89. Is concerned about the Court’s observation that the errors the Court found could, and should, have been detected by the audit authorities when they conducted their checks; notes that this reduces the extent to which the Commission can rely on the results of their work; highlights with concern the Court’s observation that, since 2017, the proportion of assurance packages with residual error rates of above 2 % had not dropped below 39 % of the expenditure in its samples, indicating that shortcomings remain in the work of the audit authorities, which are not sufficiently addressed by the Commission’s assurance work; however, welcomes the launch by the Commission of an Action Plan aiming at improving the authorities’ detection capacity in the 2021-2027 period;

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Changed77.90. Notes that the Court, in its Review 04/2025 ‘The Future of EU Cohesion Policy: Drawing lessons from the past’ recalled the longstanding challenge related to the complexity of the regulatory framework, and that, despite efforts to simplify rules and procedures, the complexity of Union regulation and the coexistence of national and regional requirements continues to impose significant administrative burdens and contributes to a high error rate; recalls, however, the important role that cohesion policy has played in reducing economic, social and territorial disparities and promoting convergence and stability across the Union, thereby demonstrating its added value for Union taxpayers, which can be further strengthened by addressing persistent weaknesses; notes that, while simplified cost options have been introduced to reduce reporting obligations, their use remains limited, especially in the ERDF; stressesrecalls thatthe persistent weaknesses in Member States’ management and control systems; calls into question the Commission’s plan for increased reliance on national systems and stresses that they must be remedied before the introduction of any such future spending model under the next MFFMFF; stresses the need to define clear and binding supervisory and control responsibilities for both the Commission and the Member States prior to the beginning of implementation; considers that increasesthe relianceCommission should not rely solely on Member States’ control systems, but should define minimum requirements and verification mechanisms, similar to those provided for under shared management, in order to avoid any non-compliance with national controls;and Union rules, as requested by the Court;

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Changed78.91. Notes that the Court’s findings, in its Special Report 04/202522/2025 ‘Financial corrections in cohesion policy funds’ that the Commission does not apply financial corrections as it should to protect the Union budget from irregular expenditure in cohesion policy, and that, despite cohesion spending being affected year after year by a significant number of errors, the Commission took more than a decade to adopt its first financial correction in September 2025 for the 2014-2020 period; points out that the legal framework governing the correction mechanism is complex that guidance and criteria for assessing serious deficiencies is not clear enough, and is not applied consistently, and that there is no well-defined timeframe for the procedure;

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Removed79. Notes that the discharge authority is considering introducing an acceptable level of error rate in cohesion policy above which annual discharge would be postponed;

92. Notes with concern that the Court identified shortcomings in the planning and preparation of the authorities’ audit work, such as weaknesses in the sampling approaches and incomplete checklists;

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Changed81.93. Recalls that, following a discharge-related access to documents request concerning contracts with 30 economic operators, the Commission had to undertake a broad and resource-intensive identification exercise due to limitations in its internal data systems, which resulted in the identification of hundreds of entities with similar or related names; acknowledges the efforts made by the Commission services to respond promptly and transparently; further recalls that, as of the next MFF, the Commission will be required to use data stored in the Arachne data-mining and risk-scoring tool to feed a centralised transparency website, with Member States obliged to provide automated access to relevant data, an obligation which will apply from 2027 onwards and on which the Commission has already begun preparatory work; stresses, however, thaturges the Commission should assess, ahead of the rollout of the new compulsory system, whether more efficient interim solutions canto beimplement putan ininteroperable placesystem to enable the rapidallow anda reliableEuropean identificationtracing of contractual relationshipsfunds with specific economic operators, at least under direct and indirect management where it does not depend onthe datastart inputof fromthe Membernew States;MFF;

94. Notes that the Court, in its Special Report 24/2025 ‘Financial instruments in EU cohesion policy: A revolving use of funds materialised partially’ found that, while one of the advantages of financial instruments in cohesion policy over grants is that reflows can be used to support additional final recipients, leading to more efficient use of public financing, only a limited reuse of reflows materialises during eligibility periods, partly due to acceptable reasons, such as the long-term nature of investments; notes that after the eligibility period, reflows are generally reused for cohesion purposes but with limitations; deplores that the legal framework on the reuse obligation is insufficiently clear and ambiguous, and that the Commission lacks oversight, leading to varying practices among Member States’ managing authorities;

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Changed83.95. Is concerned about the Court’s observation that implementation of the cohesion policy funds (ERDF, CF, ESF+), accounting for over 90 % of the shared management funds under the CPR for 2021-2027, remained low; highlightsnotes that when the Court compares their implementation (prefinancing and interim payments) with the previous programming period, the overall absorption rate of these three funds was only 5 % by the end of 2024 compared to 14 % at the equivalent point of the previous MFF (end of 2017); underlines that the current programming period has been implemented in an exceptionally challenging context marked by successive crises, inflationary pressures, supply chain disruptions and evolving geopolitical and economic conditions; acknowledges, at the same time, that the 2021-2027 programmes were adopted seven months later than those of the 2014-2020 programming period and that the pre-financing rates under the 2014-2020 programmes were higher and cleared at a different moment than those under the current MFF; notes, in this regard, that the absorption rate at the comparable implementation stage, at the end of June 2017, for the ERDF, the CF and the ESF+ stood at 3,49 %, which is comparable to the rate at the end of 2024; notes with concern that as the end of the eligibility period for the underlying expenditure and the deadline for payment of the final balance for the 2021-2027 MFF are set one year earlier than in the previous programming period, the pressure to absorb Union funds will increase further;

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Changed84.96. Expresses its concern that in 2024, the Commission forecast decommitments for the period 2025-2027 increased at EUR 8.88,8 billion compared to the 2023 forecast of EUR 8.18,1 billion for the same period and that this increase in estimated decommitments was mainly driven by the cohesion programmes under the current MFF and by the EAFRD; notes that EAFRD decommitments are expected when the programmes of the previous MFF close in 2026, while cohesion programmes for the 2021-2027 MFF face significant risks of decommitments from 2027 onwards;

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Removed85. Highlights the Commission Internal Audit Service’s (IAS) recommendation, in its audit carried out in 2024 on assurance building processes for the funds implemented under shared management, that the single audit strategy of the DG REGIO, DG EMPL and the Directorate-General for Maritime Affairs and Fisheries (DG MARE) needs to be updated as certain elements were not sufficiently clear or have not been sufficiently developed at this stage of the programming period; also notes the IAS’ recommendation that DG REGIO, which also implements the EU Solidarity Fund under shared and indirect management, needs to further improve its design and effective management;

Added97. Recalls that in 2024, several amendments to the cohesion policy and legal framework, namely STEP and RESTORE, entered into force; highlights the importance of these instruments in enhancing Union competitiveness and addressing the consequences of natural disasters; reiterates, nevertheless, that constant amendments to the cohesion policy framework lead to legal uncertainty and instability and risk undermining the long-term structural cohesion policy objectives of reducing disparities across the Union; stresses that cohesion policy needs a stable regulatory framework in order to provide predictability for beneficiaries;

Added98. Reiterates its deep concern over the disproportionate impact that the Russian war of aggression against Ukraine continues to have on the Union's eastern regions bordering Russia and/or Belarus; draws attention to the costs borne by these regions as a result of their shared border with hostile neighbouring countries, notably the respective Member States' need to direct public funding into security, defence and preparedness, while facing dramatically reduced resources due to a disruption in economic activities, cross-border trade and other exchanges; is concerned, further, about the loss in Union financial support experienced by some border regions as a result of amendments to cohesion funds under the current programming period, notably to ERDF funds initially earmarked for cross-border cooperation with Russia and Belarus and funds reallocated in the context of the 2025 cohesion mid-term review (MTR);

Added99. Underlines that territorial cohesion requires strengthening local economic resilience, for example through sustainable tourism, protection of cultural assets, youth employment and vocational skills development, including in green reconstruction, energy efficiency and civil protection services; stresses the importance of Union cohesion policy for economic and territorial convergence and development in the regions of the Union, as well as for supporting the implementation of the European Pillar of Social Rights; stresses the need to safeguard access to essential services in rural and remote areas and calls on the Commission to assess whether Union spending effectively contributes to reducing depopulation pressure;

Added100. Highlights the increasing exposure of certain regions, including Mediterranean coastal and inland territories, to climate-related risks such as storms, floods, coastal erosion and drought stress; stresses that prevention and adaptation measures are more cost-effective than post-disaster reconstruction; stresses the necessity of frontloading investments in risk prevention, hydraulic safety, slope stability, nature-based solutions and climate-resilient infrastructure, including sustainable ports, intermodal logistics, rail connectivity and resilient water systems, leakage reduction, resilient irrigation and smart water management, in order to ensure rapid and measurable resilience outcomes, enhance territorial resilience and safeguard the effectiveness of Union spending;

Added101. Highlights the Commission Internal Audit Service’s (IAS) recommendation, in its audit carried out in 2024 on assurance building processes for the funds implemented under shared management, that the single audit strategy of DG REGIO, DG EMPL and the Directorate-General for Maritime Affairs and Fisheries (DG MARE) needs to be updated as certain elements were not sufficiently clear or have not been sufficiently developed at this stage of the programming period; also notes the IAS’ recommendation that DG REGIO, which also implements the EU Solidarity Fund under shared and indirect management, needs to further improve its design and effective management;

102. Notes that, following the establishment of its framework for reduction and recoveries in case of fraud, corruption, and conflict of interests affecting the financial interests of the Union that have not been corrected by the Member State, the Commission undertook the first such reduction on 8 May 2025, when, following an OLAF recommendation, it adopted its first implementing decision reducing support to Slovakia by EUR 1,225 million in relation to an uncorrected irregularity; notes, however, the Court’s finding in Special Report 26/2025 that the Commission lacks a mechanism to monitor whether amounts ordered to be recovered by national courts following criminal proceedings are actually repaid in full to the Union budget;

103. Expresses deep concern over the findings in the 2025 Rule of Law Report regarding the rule of law situation in Hungary, particularly the persistent and systemic challenges in the judiciary and the media sectors; notes with alarm that the transparency of case allocation in lower courts has not been improved, and that undue pressure on some judges continues within the judiciary, notably in relation to internal debates on key issues related to judicial independence; notes with concern in the same vein that the implementation of the 2024-2025 National Anti-Corruption Strategy lags behind, with the decrease of the number of convictions for corruption crimes, the absence of progress in establishing a robust track-record on high-level corruption, and the continuous reporting by the Hungarian Integrity Authority of obstacles in fulfilling its oversight tasks effectively;

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Removed88. Notes that from the EUR 20,9 billion allocations under the CPR initially blocked due to fundamental rights concerns, only EUR 8,6 billion remain blocked for the Hungarian government in January 2026; further notes that from the EUR 6,3 billion initially blocked under the Rule of Law Conditionality Regulation because of rule of law and corruption concerns, EUR 1 and 1,1 billion have been decommitted at the end of 2024 and 2025 respectively; expresses deep concern that, while the rule law continues to deteriorate and corruption flourishes through entrenched oligarchic networks in Hungary, the amount of Union funds that remains frozen due to rule of law and corruption concerns decreases, and consequently, the pressure applied by the Commission on the Hungarian government to make reforms shrinks constantly;

Added104. Reiterates its serious concerns about the Commission's decision of 13 December 2023, concluding that the Hungarian government had satisfied the Charter requirements in relation to judicial independence and lifting the suspension on the disbursement of funds for related programmes, resulting in Hungary becoming eligible to receive approximately EUR 10,2 billion from various funds governed by the CPR; reminds that on 25 March 2024, the European Parliament brought an action before the Court of Justice in order to review the legality of the Commission decision, as well as to bring legal certainty to the implementation of the rule of law mechanism; notes that while the CJEU ruling is still pending, the Advocate General proposed on 12 February 2026 that the Court of Justice annul the Commission's decision lifting the suspension on the disbursement of funds to Hungary;

Removed89. Notes that MOL, a publicly listed Hungarian petrochemical conglomerate, is effectively controlled through three so-called public interest trusts affiliated with the Hungarian Government, each holding a 10 % share; recalls that Council Implementing Decision (EU) 2022/2506 of 15 December 2022 prohibits the Commission from entering into new legal commitments, under direct or indirect management, with Hungarian public interest trusts and entities maintained by them when implementing the Union budget; notes with concern that at least one funding agreement appears to have been concluded between the Commission and MOL after the adoption of that Decision; takes note of the Commission’s reply that it is investigating the matter, and expects the Commission to provide the discharge authority without delay with a clear explanation of how such a commitment could have been signed;

Added105. Notes that from the EUR 19,8 billion allocations under the CPR, initially blocked due to fundamental rights concerns, only EUR 7,6 billion remain blocked for the Hungarian government in January 2026; further notes that from the EUR 6,4 billion initially blocked under the Rule of Law Conditionality Regulation because of rule of law and corruption concerns, EUR 1 and 1,1 billion have been decommitted at the end of 2024 and 2025 respectively; expresses deep concern that, while the rule law continues to deteriorate and corruption flourishes through entrenched oligarchic networks in Hungary, the amount of Union funds that remains frozen due to rule of law and corruption concerns decreases, and consequently, the pressure applied by the Commission on the Hungarian government to make reforms shrinks constantly;

Removed90. Notes that the Hungarian government is set to receive the third-largest allocation under the SAFE instrument, amounting to EUR 16,2 billion, intended to support major defence-industry investments; recalls that the Commission has the power to withhold approval of national defence investment plans under SAFE where there are concerns regarding the protection of the Union’s financial interests; notes that the Hungarian government recently sold a controlling 75 %+1 stake in its state defence-industry holding to 4iG, a company widely seen as close to the government; strongly warns that, in light of the continued deterioration of the rule of law, persistent corruption risks and systemic weaknesses in oversight as described above, the Union’s financial interests cannot be considered adequately protected if SAFE funding were to be disbursed to Hungary without, at the very least, setting strict conditions that must be met prior to any disbursement of funds;

Added106. Notes the requests by the Hungarian government on 28 and 29 March 2025 to transfer EUR 545 million from two cohesion programmes to new priorities under the Strategic Technologies for Europe Platform (STEP), of which EUR 395 million from funds frozen due to the failure to meet the horizontal enabling condition under the Charter of Fundamental Rights; deeply regrets the Commission’s approval of the amendments on 25 September 2025, that despite again blocking reimbursements for the new STEP priorities due to non-compliance with Charter requirements, nevertheless gave the Hungarian government access to EUR 317,3 million in pre-financing; reaffirms that the reallocation or reshuffling of frozen appropriations to other programmes or objectives would signal to governments non-compliant with Union values and with their obligations to protect the Union’s financial interests that losses can be offset elsewhere; recalls its position that funds suspended pursuant to the Conditionality Regulation or due to non-fulfilment of horizontal enabling conditions should not be eligible for programme amendments or transfers; calls, therefore, on the Commission to exercise its right of initiative and propose measures to close any existing loopholes in the Union's legislative framework that may enable governments to transfer funds suspended due to breaches of their rule of law or other Charter of Fundamental Rights obligations, and ensure that any future funding instruments are proofed for circumvention;

Removed91. Highlights with alarm that since the 2024 Rule of law Report, Slovakia adopted a series of amendments to the Criminal Code, passed in the second half of 2024, including the closure of specialised anti-corruption entities, National Crime Agency and Special Prosecutor’s Office, which resulted in delays in investigations transferred to other bodies and significant drops in the number of corruption cases; notes with concern Slovakia’s Government plan to replace the current office for whistleblowers with an institution whose chair would be appointed directly by the parliamentary speaker, which risks politicising the office, aligning its work with the Government’s priorities, scaling back protection of whistleblowers, and undercutting scrutiny of how the Government handles Union funds; stresses that these developments pose an increased, substantial risk to the sound financial management of the Union budget; emphasises that the Rule of Law Conditionality Regulation is not limited to last-resort measures, but also allows for early action with partial suspensions, where rule of law breaches are identified that pose a serious risk to the sound financial management of the Union budget;

Added107. Notes that MOL Plc, a publicly listed Hungarian petrochemical conglomerate, is effectively controlled through three so-called public interest trusts affiliated with the Hungarian Government, each holding a 10 % share; recalls that Council Implementing Decision (EU) 2022/2506 of 15 December 2022 prohibits the Commission from entering into new legal commitments, under direct or indirect management, with Hungarian public interest trusts and entities maintained by them when implementing the Union budget; notes with concern that at least one funding agreement appears to have been concluded between the Commission and MOL after the adoption of that Decision; takes note of the Commission’s reply that it is investigating the matter, and expects the Commission to provide the discharge authority without delay with a clear explanation of how such a commitment could have been signed;

Added108. Notes that the Hungarian government is set to receive the third-largest allocation under the SAFE instrument, amounting to EUR 16,2 billion, intended to support major defence-industry investments; recalls that the Commission has the power to withhold approval of national defence investment plans under SAFE where there are concerns regarding the protection of the Union’s financial interests; notes that the Hungarian government recently sold a controlling 75 %+1 vote majority stake in its state defence-industry holding to 4iG, a company widely seen as close to the government; strongly warns that, in light of the continued deterioration of the rule of law, persistent corruption risks and systemic weaknesses in oversight as described above, the Union’s financial interests cannot be considered adequately protected if SAFE funding were to be disbursed to the Hungarian government without, at the very least, setting strict conditions that must be met prior to any disbursement of funds;

Added109. Highlights with alarm that since the 2024 Rule of Law Report, Slovakia adopted a series of amendments to the Criminal Code, passed in the second half of 2024, including the closure of specialised anti-corruption entities, the National Crime Agency and the Special Prosecutor’s Office, which resulted in delays in investigations transferred to other bodies and significant drops in the number of corruption cases; notes with concern Slovakia’s Government plan to replace the current office for whistleblowers with an institution whose chair would be appointed directly by the parliamentary speaker, which risks politicising the office, aligning its work with the Government’s priorities, scaling back protection of whistleblowers, and undercutting scrutiny of how the Government handles Union funds; stresses that these developments pose an increased, substantial risk to the sound financial management of the Union budget; emphasises that the Rule of Law Conditionality Regulation is not limited to last-resort measures, but also allows for early action with partial suspensions where rule of law breaches are identified that pose a serious risk to the sound financial management of the Union budget; fully supports the Commission’s decision and calls on the Commission to start the first step of the conditionality mechanism and to launch an infringement proceeding regarding this matter;

110. Notes, in this context, that following the Committee on Budgetary Control mission to Bratislava on 26–28 May 2025, unfounded public statements by the Prime Minister of Slovakia and members of the National Council led to threats against the Leader of the mission, necessitating police protection; considers that such incidents further illustrate the deteriorating rule of law environment and the risks it poses to the Union’s financial interests;

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Changed93.111. Deplores that, according to civil society’s analysis, the vast majority of recommendations from the Rule of Law Report repeat the previous ones; considers that this raises concerns as to whether the recommendations are taken sufficiently seriously by Member States and whether the Commission is applying adequate pressure to ensure their effective implementation; stresses that, many of the shortcomings listed in the Rule of Law Report have a direct impact on the sound financial management of the Union budget and therefore considers it essential from a budgetary control perspective that the exercise produces tangible and measurable results; invites, therefore, the Commission to translate the country-specific recommendations from its annual Rule of Law Reports into concrete milestones to be systematically acted upon by the Member States, and to trigger the Conditionality Regulation where systematic rule of law breaches, identified under the pillars of the Report, have a sufficiently direct link to the protection of the Union budget;

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Changed94.112. Notes the Commission reply that the Secretariat-General (SG) coordinates between the use of three different instruments of the Conditionality Regulation, the Rule of Law Report, the RRF and of the CPR horizontal enabling conditions to ensure consistency across all programmes, instruments and Member States, and that within each instrument, there is a lead service entrusted with the implementation and relevant associated services also feed into this work; further notes that the Directorate-General for Justice and Consumers (DG JUST) and SG jointly lead the work on the Rule of Law Report, DG EMPL leads for the work on the Charter horizontal enabling condition, SG REFORM with the Directorate-General for Economic and Financial Affairs (DG ECFIN) for the work on the RRF and the Directorate-General for Budget (DG BUDG) for the work on the Conditionality Regulation; deplores, however, that the role ofinvites the Commission Presidentto onfurther clarify the decision-makingrole behindof frozenall fundsdecision-makers remainsin opaque;these notesprocedures; that,underlines despitethat while a solid framework exists on paper, the decision-makingpractical processapplication remainsof insufficientlyprocedures transparentcould inbe practice;further enhanced; regrets that in the past,Commission in the Commissionpast only provided the bare minimum amount of information, without key details, and did not share the full documentation,documentation even after Parliament had requested it; stresses that cleartimely, comprehensive and transparentproactive decision-makinginformation structuressharing areis essential for it to avoidexercise anyits perceptionbudgetary ofand theoversight freezingresponsibilities ofeffectively fundsand beingfor subjectcitizens to politicalmaintain considerations;trust in the Union institutions and the EU’s credibility as a whole;

113. Regrets that the Commission took more than two years to open infringement proceedings against Malta for the non-application of Union law in the field of online gambling; notes with serious concern that, as a result of Malta’s legislation preventing the enforcement of valid judgments from other Member States, around 100 000 Union citizens entitled to repayments have been unable to obtain redress; notes further that several gambling companies licensed in Malta have begun transferring assets to other entities, thereby risking the effective enforcement of thousands of court judgments even if the contested legislation were to be withdrawn; deeply regrets, in this context, the Commission’s delay in initiating infringement proceedings;

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Added114. Recalls the findings of the Court’s Special Report on the Digitalisation of Healthcare, which concluded that Union support to Member States has been overall effective in fostering the digital transformation of healthcare systems; notes, however, that Member States have faced difficulties in utilising Union funds allocated for this purpose and regrets that while the Commission monitors the progress achieved by Member States in the digitalisation of healthcare, it does not yet possess a comprehensive overview of how Union funds are being used to support these activities; calls on the Commission to implement in full the Court’s recommendations, in particular by improving guidance to Member States, strengthening monitoring and performance-based oversight of Union funds used for digital health and ensuring that digital health investments uphold the highest standards of data protection, cybersecurity and interoperability;

Added115. Acknowledges that the EU4Health programme has contributed to the InvestEU programme through blending with the Union guarantee, thereby mobilising additional investments; notes in particular the contribution of EUR 110 million via an InvestEU top-up supporting EIB investments in innovative life-science projects related to medical countermeasures; underlines the importance of ensuring transparency, efficient coordination with national and Union funding instruments, and broad access to Member States so that these investments deliver strong European added value and strengthen the resilience of the Union’s health systems; recalls the importance of investing in medical innovation and technologies at a European level and the importance of strengthening the cooperation between research institutions, private medical companies and public authorities to better serve the public interest;

Added116. Regrets the Commission’s decision to discontinue operating grants supporting the health sector which represented just over 1% of the EU4Health budget in 2024; observes that these changes have affected a continuity contribution to European public health objectives; stresses the importance of predictable and stable support mechanisms for stakeholder and civil society organisations active in health; suggests that future funding continues to be based on clear criteria of European added value, transparency, political neutrality, and measurable impact, to ensure resources are directed where they provide the greatest benefit for patients and health systems; highlights the role of stakeholder and civil society actors in contributing to Union health policy objectives and implementation;

Added117. Notes that the Commission allocated EUR 8 million in 2024 and EUR 20,9 million in 2025 for calls for proposals for the production of content on Union affairs by consortia of news media organisations, and that three media consortia currently receive Union funding; recalls that a free, independent and pluralistic press is a cornerstone of democratic accountability; considers that Union support for media can contribute to strengthening media pluralism and informed public debate across the Union, provided that strict safeguards are in place to ensure full editorial independence and transparency; underlines the importance of transparency regarding all financial support, including grants, contracts and indirect funding provided to media organisations, and that such information should be easily accessible and clearly presented;

Added118. Regrets that the Commission had not performed interim evaluations of the flagship programmes Erasmus+, European Solidarity Corps, and Creative Europe before the legally defined deadline; stresses that evaluations should inform decision-making for the current programming period, as well as for the future one;

▸6 unchanged paragraphs

Recommendations

119. Calls on the Commission to act on the Court’s recommendations from its Annual Report to ensure that:

(i) audit authorities strengthen their control and detection capacity by verifying that they plan properly the sampling, confirm that compliance with eligibility criteria is proven, and keep proper documentation to support the audit trail;

(ii) when systematic weaknesses have been detected in operational programmes and a flat rate has been imposed, Member State authorities do not use the flat rate correction mechanism to avoid their responsibility to check the eligibility of the expenditure before declaring it to the Commission, and make individual recoveries as necessary;

120. Furthermore, calls on the Commission to:

(i) continue to address the systemic issue of non-detection of errors at Member State level in cohesion policy spending with the effective implementation of the action plan, aimed at increasing detection capacity at Member State and Commission level;

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Added(ii) further strengthen guidance, coordination and monitoring in order to ensure greater legal certainty and more effective reuse of reflows across Member States;

Added(iii) work closely with Member States, in particular those facing structural or capacity constraints, to provide technical assistance, administrative simplification and sufficient flexibility in implementation in order to ensure the full and effective absorption of cohesion funds;

(iv) develop a methodology to measure the overall financial impact of EPPO and OLAF investigations, including amounts recovered following national court decisions in criminal proceedings, and to obtain regular information from Member States on asset recovery and the share returned to the Union budget as recommended by the Court;

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Changed(iii)(v) link recommendations from the Rule of Law Report to the implementation of concrete measures by the Member State concerned to have a stronger impact and at best contribute to protecting the Union’s financial interests, and refers in this regard to the recommendations made in Parliament’s resolution of 18 June 2025 on the Commission’s 2024 Rule of Law Report;

(vi) step up its monitoring of the horizontal and thematic enabling conditions in all Member States to identify potential threats to the protection of the Union Budget and ensure enhanced transparency and stakeholder participation in the application of this tool;

(vii) closely align the rule of law report with the Conditionality Regulation and report in more detail on the breaches of the principles of the rule of law that can be used as input to trigger the Conditionality Regulation;

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Added(viii) exercise its right of initiative and propose measures to close any existing loopholes in the Union's legislative framework that could enable governments to transfer funds suspended in accordance with the Rule of Law Conditionality Regulation or on account of non-fulfilment of horizontal enabling conditions, and ensure that any future funding instruments contain adequate safeguards against circumvention;

(ix) urgently reassess and address the deterioration of the rule of law and risks to the Union budget in Hungary and take all necessary actions in accordance with the Conditionality Regulation and other available tools, including full suspension of Union funds;

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Added(x) carry out an ex-post evaluation of the financial impact of cohesion policy amendments on eastern border regions, notably the ERDF funds initially earmarked for cross-border cooperation with Russia and Belarus as well as funds reallocated in the context of the 2025 cohesion mid-term review, covering the extent to which Union funds originally intended for regions sharing a border with Russia and/or Belarus have ultimately remained in them or conversely been directed elsewhere, share its evaluation with the discharge authority, and urgently propose targeted financial support for these regions to counter the disproportionate impact of Russia's war of aggression, including remedying losses suffered as a result of the amendments during the current programming period;

Added(xi) reconsider the single audit approach until the weaknesses identified in the managing and audit authorities in Member States have been tackled;

Added(xii) ensure operating grants are provided under the EU4Health programme;

Natural resources and environment

121. Notes that the budget for the programmes under MFF heading 3 ‘Natural resources and environment’ was EUR 64,4 billion (33,7 % of the Union budget) distributed as follows: 59,2 % of this expenditure went to the European Agricultural Guarantee Fund (EAGF) – direct payments (EUR 38,1 billion), followed by EAFRD (EUR 15,5 billion, 24,0 %), Just Transition Fund (EUR 6,2 billion, 9,5 %), European Agricultural Guarantee Fund (EAGF) – market-related expenditure (EUR 2,7 billion, 4,1 %), Maritime and Fisheries (EUR 1,3 billion, 2,0 %), Environment and Climate (LIFE) (EUR 600 million, 0,9 %) and other (EUR 200 million, 0,3 %);

122. Underlines that in 2024 the common agricultural policy (CAP) represented the main share (87,3 %) of Union spending on natural resources and environment; recalls that 2024 was the second year of the CAP 2023-2027, which introduced a new delivery model incorporating performance-based elements, agreed with the Member States in Strategic Plans, as the basis for payments;

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Changed100.123. WelcomesNotes that at the end of 2024, payments from EAFRD 2021-20272023-2027 amounted to EUR 6,3 billion (in 2023: EUR 700 million), representing an absorption rate of 9,5 % (compared to 1 % in 2023); alsostresses welcomesthat delayed payments undermine farmers’ income stability; notes the 32 % absorption rate of the Just Transition Fund; notes with concern the low absorption rate of European Maritime, Fisheries and Aquaculture Fund (EMFAF), which reached only 3 % by the end of 2024,2024;

124. Notes that the Court has examined a sample of 228 transactions covering the full range of spending under this MFF heading in 19 Member States and the United Kingdom; notes with concern that the Court estimates the level of error for this heading to be 2,6 % (in 2023: 2,2 %); further notes that the Court found eight quantifiable errors (i.e. errors with a direct financial impact on the Union budget) in rural development, eight in eco-scheme transactions, a new type of intervention introduced under the 2023-2027 CAP to support agricultural practices that contribute to the climate and the environment goals and animal welfare, three in direct payments excluding eco-schemes, two in market measures, and one in a shared management transaction under the EMFAF; observes that the Court also detected 19 other compliance issues with no financial impact on the Union budget;

125. Notes the categorisation of errors by the Court, with administrative errors accounting for 44 % of errors, ineligibility issues for 28 %, non-respect of agri-environmental, climate, or eco-scheme commitments for 16 % and provision of inaccurate information on areas or animals for 12 %;