The European Parliament on Thursday granted discharge to the Commission, all decentralised agencies and the development funds.

The annual discharge is a crucial part of Parliament’s budgetary oversight role. Its purpose is to hold the EU institutions accountable for spending the EU budget according to EU rules, principles of sound financial management and the EU’s political priorities. In their scrutiny process, MEPs take into account the annual report published by the EU Court of Auditors.

Parliament can decide to grant, postpone or reject the discharge for each EU institution and body.

With more than 95% of the EU’s expenditure managed by the European Commission, MEPs generally endorse its budgetary management (by 438 votes in favour, 167 against and 5 abstentions), but they criticise the high error rate in the 2022 spending. This rose to 4.2%, up from 3% in 2021 and 2.7% in 2020, prompting MEPs to warn against underestimating the level of risk.

Similarly, the EU’s outstanding commitments in 2022 have reached a record-high (€450 billion, largely due to the NextGenerationEU package). They are also concerned about member state reporting and control systems for the EU’s recovery and resilience funds and warn of the risk they pose to the EU’s financial interests.

In the resolution that accompanies the discharge decision, MEPs regret the “political contradiction” in disbursing the previously suspended funds to Hungary in exchange for its endorsement of aid for Ukraine. They warn the Commission against “watering down” the EU’s climate goals and ask to speed up the pace of investments, noting that in 2022 the European Union fell short of the efficiency needed to achieve the goals set for 2030, 2040 and 2050.

Misuse of EU money by Hamas and diversifying the EU aid to Palestine

With 305 votes in favour, 245 against and 44 abstentions MEPs adopted an amendment voicing concerns about “credible reports” that EU money “could have been partially misused” by Hamas and that UNWRA staff could have been involved in terrorist acts, MEPs urge the Commission to diversify the recipients of EU support to Palestinian civilians and to include the WHO, UNICEF and the Red Crescent. They also urge the Commission to guarantee independent controls of UNRWA.

Alleged COVID-19-related misuse of EU funds

Parliament also voices concern about the alleged COVID-19-related misuse of European Union funds in Spain and Czechia for the purchase of medical equipment and urge the Commission to rely on external auditors if there is a “severe lack of capacity in a member state”, and call for in depth ex-post audits for all contracts awarded without procurement. They also point to another recently uncovered alleged fraud in Portugal involving European Regional Development funds.

Appointment process for the new EU SME Envoy

In an amendment adopted by 382 votes in favour, 144 against and 80 abstentions, MEPs criticise the politicised process to appoint the EU’s SME Envoy “despite having been outqualified (…) by the two remaining female candidates from underrepresented Member States”, and who is an outgoing MEP from “President von der Leyen’s own German political party”. They ask the Commission to select a new candidate using a “truly transparent and open process”.

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“The budget is the most effective tool to deliver our political priorities, to improve the lives of citizens and to act in the face of crises of all kinds. That is why it must be protected by all means from any irregular use, be it errors or fraudulent behaviour”, rapporteur Isabel García Muñoz (S&D, Spain) said. “We need greater simplification and flexibility, without undermining controls, measures to improve the absorption of funds and to make progress in digitisation to improve the management of European funds and fight fraud and corruption more effectively”, she concluded.

Listen to the plenary debate on Wednesday evening that preceded the vote.

Council

MEPs agreed (by 515 votes to 62 and 20 abstentions) to delay the vote on the Council discharge until the next plenary, awaiting a decision by member states to provide Ukraine with missile protection systems.

Find here the vote results on all discharge decisions for every EU institution and agency.

On Thursday, MEPs adopted plans to facilitate the uptake of renewable and low-carbon gases, including hydrogen, into the EU gas market.

The new directive and regulation on the gas and hydrogen markets aim to decarbonise the EU’s energy sector, enhancing the production and integration of renewable gases and hydrogen.

These measures are designed to secure energy supplies disrupted by geopolitical tensions, particularly the Russian war against Ukraine, and address climate change. In negotiations with Council on the directive, MEPs focused on securing provisions around transparency, consumer rights, and support for people at risk of energy poverty. Plenary adopted the directive with 425 votes in favour, 64 against and 100 abstentions.

The new regulation, adopted with 447 votes in favour, 90 against and 54 abstentions, will beef up mechanisms for fair pricing and stable energy supply, and will allow member states to limit gas imports from Russia and Belarus. The legislation will introduce a joint gas purchasing system to avoid competition among member states and a pilot project to bolster the EU’s hydrogen market for five years.

The regulation also focuses on increasing investments in hydrogen infrastructure, especially in coal regions, promoting a transition to sustainable energy sources like biomethane and low-carbon hydrogen.

Quotes

“Europe’s steel and chemical industries, which are hard to decarbonise, will be placed at the centre of the development of a European hydrogen market,” lead MEP on the directive Jens Geier (S&D, DE) said. “This will enable fossil fuels to be phased out of industry, secure European competitiveness, and preserve jobs in a sustainable economy. Unbundling rules for hydrogen network operators will correspond to existing best practices in the gas and electricity market.”

Lead MEP on the regulation Jerzy Buzek (EPP, PL) said: “The new regulation will transform the current energy market into one based primarily on two sources – green electricity and green gases. This is a huge step towards meeting the EU’s ambitious climate goals and making the EU more competitive on global markets. We have introduced a legal option for EU countries to stop importing gas from Russia if there is a security threat, which gives them a tool to phase out our dependence on a dangerous monopolist.”

Next steps

Both texts will now have to be formally adopted by Council before publication on the Official Journal.

Background

The legislative package reflects the EU’s growing climate ambitions, as set out in the European Green Deal and its ‘Fit for 55’ package. The updated directive aims to decarbonise the energy sector and includes provisions on consumer rights, transmission and distribution system operators, third-party access and integrated network planning, and independent regulatory authorities. The updated regulation will push existing natural gas infrastructure to integrate a higher share of hydrogen and renewable gases, by means of high tariff discounts. It includes provisions to facilitate blending hydrogen with natural gas and renewable gases, and greater EU cooperation on gas quality and storage.

MEPs urge the Council to add sexual and reproductive healthcare and the right to a safe and legal abortion to the EU Charter of Fundamental Rights.

In a resolution adopted on Thursday with 336 votes in favour, 163 against and 39 abstentions, MEPs want to enshrine the right to abortion in the EU Charter of Fundamental Rights – a demand they have made several times. MEPs condemn the backsliding on women’s rights and all attempts to restrict or remove existing protections for sexual and reproductive health and rights (SRHR) and gender equality taking place globally, including in the EU member states.

They want Article 3 of the Charter to be amended to state that “everyone has the right to bodily autonomy, to free, informed, full and universal access to SRHR, and to all related healthcare services without discrimination, including access to safe and legal abortion”.

The text urges member states to fully decriminalise abortion in line with the 2022 WHO guidelines, and to remove and combat obstacles to abortion, calling on Poland and Malta to repeal their laws and other measures that ban and restrict it. MEPs condemn the fact that, in some member states, abortion is being denied by medical practitioners, and in some cases by entire medical institutions, on the basis of a ‘conscience’ clause, often in situations where any delay will endanger the patient’s life or health.

Education and high-quality care

Abortion methods and procedures should be an obligatory part of the curriculum for doctors and medical students, Parliament says. Member states should ensure access to the full range of SRHR services including comprehensive and age-appropriate sexuality and relationship education. Accessible, safe and free contraceptive methods and supplies, and family planning counselling, should be made available, with special attention paid to reaching vulnerable groups. Women in poverty are disproportionately affected by legal, financial, social and practical barriers and restrictions to abortion, MEPs say, calling on member states to remove these barriers.

Stop EU funding to anti-choice groups

MEPs are concerned about the significant surge in funding for anti-gender and anti-choice groups around the world, including in the EU. They call on the Commission to ensure that organisations working against gender equality and women’s rights, including reproductive rights, do not receive EU funding. Member states and local governments must increase their spending on programmes and subsidies to healthcare and family planning services.

Background

France became the first country to enshrine the right to abortion in its constitution on 4 March 2024. Healthcare, including sexual and reproductive health, falls under national powers. Changing the EU Charter of Fundamental Rights to include abortion would require unanimous agreement from all member states.

The measures, composed of a regulation and a directive already agreed upon with the Council, were adopted with 433 in favour, 140 against and 15 abstentions, and 473 votes to 80, with 27 abstentions, respectively.

The law will protect consumers against volatile prices. MEPs ensured that they will have the right to access fixed-price contracts or dynamic price contracts, and receive important information on the options they sign up to. Suppliers will not be allowed to unilaterally change the terms of a contract.

MEPs also secured that EU countries can prohibit suppliers from cutting the electricity supply of vulnerable customers, including during disputes between suppliers and customers.

Contracts for Difference

The legislation provides for so-called “Contracts for Difference” (CfDs), or equivalent schemes with the same effects, to encourage energy investment. In a CfD, a public authority compensates the energy producer if market prices fall too steeply, but it collects payments from them if prices are too high. The use of CfDs will be allowed in all investments in new electricity production, whether from renewable or nuclear energy.

Electricity price crisis

The text sets out a mechanism to declare an electricity price crisis. In a situation of very high prices and under certain conditions, the EU may declare a regional or EU-wide electricity price crisis, allowing member states to take temporary measures to set electricity prices for SMEs and energy intensive industrial consumers.

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“This reform puts citizens at the forefront of electricity market design. The text includes measures to protect citizens, especially the most vulnerable and to accelerate the deployment of renewable energy sources. The Parliament has taken a step forward in democratising energy, creating a market design that responds to the failures exposed by the energy crisis. All consumers, including micro, small, and medium-size enterprises will have access to long-term, affordable and stable prices.” lead MEP Nicolás González Casares (S&D, ES) said.

Next steps

After Parliament’s approval, Council also needs to formally adopt the legislation to become law.

Background

Energy prices have been rising since mid-2021, initially in the context of the post-COVID-19 economic recovery. However, energy prices rose steeply due to gas supply problems following Russia’s war against Ukraine in February 2022. High gas prices had an immediate effect on electricity prices, as they are linked together under the merit order system, where the most expensive (usually fossil fuel-based) energy source sets the overall electricity price.

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