Changes from report parliamentary committee draft to plenary report

The sound management of Union’s resources, on both the expenditure and the revenue sides, as well as transparency and the protection of the EU’s financial interests, should be key elements of any EU policy, in order to ensure their efficient implementation, to guarantee that taxpayers’ money is used appropriately and effectively and to strengthen citizens’ trust in the European Institutions.

The Commission is required by the Treaty on the Functioning of the European Union to produce an Annual Report on the Protection of the EU’s Financial Interests (PIF Report). This report is based on data provided by Member States and presents the measures taken at European and national levels to combat fraud affecting the Union’s budget.

While the PIF report is an essential instrument for transparency and accountability, it does not yet provide a comprehensive overview of a rapidly evolving of increasingly complex landscape, in which the challenges and their possible negative impacts remain significant. Against this background, the European Parliament’s INI Report is based on the analysis of a wide range of information sources and reports from numerous Institutions and authorities and it aims at contributing to the protection of the Union’s financial interests by setting the direction of the anti-fraud policy and more effectively promoting targeted actions.

The INI Report identifies the main threats and weaknesses of the current framework at Union’s and Member States’ levels, including organised crime, corruption, under-reported conflict of interests and VAT fraud. The analysis highlights shortcomings in the implementation of performance-based instruments and external actions and it recommends to devote additional efforts and adequate resources to the key components of the anti-fraud cycle: not only investigations and prosecution, but in particular detection and prevention are crucial stages, too often underrated in the setting of national and European strategies. Persistent legislative fragmentation and the underfunding of national anti-fraud authorities, combined with the growing complexity of transnational fraudulent schemes and international financial flows, represent challenges that call for enhanced cooperation among the anti-fraud authorities. Greater day-to-day transparency beyond the annual reporting obligation and improved reporting practices are required, including on recovery. The development of new technologies should be further pursued, making use of strengthened IT tools, the digitalisation of processes, databases interoperability and the integration of artificial intelligence (AI) in the main controlling processes. The INI Report calls for more tangible and result-oriented efforts to ensure that the Union’s resources are correctly deployed and the financial interests are safeguarded for the benefit of all European citizens.