Changes from report parliamentary committee draft to plenary report

Performance-based instruments are reshaping the way the European Union finances its policies. By linking payments to the achievement of milestones and targets, rather than to the reimbursement of eligible costs, they promise to accelerate reforms and strengthen the focus on results. The Recovery and Resilience Facility (RRF) was the first large-scale application of this model, and the Commission has proposed to embed it more widely through National and Regional Partnership Plans in the next Multiannual Financial Framework.

This shift has undeniable advantages: it simplifies procedures, emphasises outputs, and can increase political ownership of reforms. Yet it also introduces significant risks for control, transparency and accountability. The European Court of Auditors has already identified weaknesses in the design of the RRF control system, including incomplete audit trails, heavy reliance on national authorities and variability in control quality across Member States. The European Parliamentary Research Service has highlighted shortcomings in national reporting and the limits of transparency tools such as the RRF Scoreboard and expert groups. The recent European Parliament’s study on performance and mainstreaming framework for the EU budget for the Committee on Budgets has further underlined gaps in data systems, monitoring weaknesses, and the limits of the European Parliament’s engagement.

These lessons must be taken seriously. Without access to data on actual costs of EU-funded interventions, it is difficult to demonstrate value for money. Without clear thresholds for corrective action, enforcement risks becoming inconsistent or arbitrary. Without transparent methodologies for assessing milestones and targets, there is a danger of unequal treatment between Member States. And without stronger parliamentary involvement, democratic accountability is weakened.

This report therefore calls for a stronger framework of control and transparency for performance-based instruments: harmonised methodologies, interoperable data systems, robust audit trails, and clear criteria for corrections. It urges the Commission to expand transparency tools, to ensure full traceability of beneficiaries and final recipients and to strengthen safeguards for financial instruments. Most importantly, it insists on a greater role for Parliament in the governance of performance-based instruments.

The European Commission is proposing to channel hundreds of billions of euros through this model in the coming years. If designed well, performance-based instruments can deliver reforms effectively and can reinforce trust in the EU. If not, they risk eroding accountability and weakening the link between EU financing and sound financial management. This own-initiative report aims to ensure that the lessons from the RRF are fully incorporated into the next generation of instruments, so that performance is matched by integrity, transparency and democratic oversight.