EU regional policy and financial instruments
UNDP Seminar on Local Capacity Building to Absorb EU Funds
Skopje, 1-3 December 2004
Claus Schultze, INTERREG IIIC East Joint Technical Secretariat, Vienna
+43 1 4000 76142, [email protected], www.interreg3c.net
Policy context•EU regional policy is extremey complex•It is a policy that still evolves•Based on political consensus•Hence a mix of political and technical
ingredients (framework+funding) •Policy cycle often not closed,
experiences lost•Member States and Commission are
masters of the game with role of MS growing
•But need to programme for needs of regions (at least in ERDF) and involve stakeholders
Current instruments• Structural Funds: ERDF, ESF, EAGGF (part of
CAP), FIFG (part of CAP)• CIs: URBAN, EQUAL, INTERREG, LEADER• Cohesion fund• Pre-accession instruments• State aid rules• (Other sectoral programmes important in the
context of territorial development, i.e. SMEs, Information Society, Research, etc.)
• Overlap with other EU policies, lack of coordination, lack of harmonisation
Eligibility• Nuts data determines eligibilty• Cohesion Fund: Nuts 1 (MS level)• Objective 1: NUTS 2 regions < 75%• Objective 2: NUTS 3 or smaller: Declining
regions with certain characteristics (e.g. unemployment rate)
• SF are governed by different funds (e.g. allocation of money, eligible activities, management structures and procedures)
• Each fund has their own management rulesand legal basis
Region in EU terms (1)• NUTS specification• Nuts 1 (3-7 million)• Nuts 2 (800‘ to 3 million)• Nuts 3 (150‘ to 800‘)
Region in EU terms (2)• The political region• The Committee of the Regions• 317 elected representatives from 25 MS• Nominated by national governments• Represent the entire range of local and regional
government: regional presidents, regional parliamentarians, town councillors, mayors of large cities, etc.
• Strengthens regional/local level in the EU• Advisory body with rising influence• Competition with EP + legislative regions
Governance apects (1)
• Regions/localities can get involved in programming (mostly competence of MS)
• Regions/localities can get involved in programme implementation (shared competence)
• Regions/localities can be beneficiaries or coordinators of individual projects
Governance aspects (2)
• Partnership principle vs. subsidiarity• No clear binding rules, only soft law• Top-down vs. bottom-up elements• Depending on governance arrangements• SF: specific regimes (e.g. ESF and Cohesion
Fund centralized, ERDF decentralised)• In new MS: pretty centralised management
(not much prior experience, lack of capacities and experiences at regional level, MS responsible in case of irregularities, etc.)
Public participation
• Regions/localities only one actor among other stakeholders (e.g. NGOs)
• Involvement in new MS and some more centralised old MS not systematic and often only sporadic
• NGOs (e.g. environment) often better informed and have professional lobbying (e.g. EEB bankwatch)
Programming: Examply HungaryConsultation process (Source: NDP, 259ff.)• Social partners, economic and professional organisations: contacted directly• Regional partners and local governments : Regional Development Councils and• Agencies were asked to comment on the plan, due to high number of potential
partners (>3000 localities) indirect contact through their associations• Non-governmental organisations registered on official lobby list of Parliament
received plan for consultation• Seminars• National Partnership
Conference• Webpage, etc.
Partners actively respondingto request by NPD Office
Capacity building• Before enlargement and ongoing: PHARE-Twinning
(mainly national level) and other Phare-funded capacity-building measures + Phare CBC, SPF
• After enlargement: Mainly up to MS (TA budgets)• INTERREG CI contributes indirectly to capacity-building at
regional level (ex/ex)• INTERACT Point Managing Transition provides services
(www.interact-eu.net)• EU concentrates on national level and implementation
structures• No systematic CB for regions, not to speak of localities
(too many for EU to deal with)
INTERREG IIICommunity Initiative: indirect CB instrument
3 strands:
• IIIA: cross-border (54 programmes)
• IIIB: transnational (13 programmes)
• IIIC: interregional (4 programmes)
Available Budget (2000-2006)
SF total: 195 billion (EU15)
INTERREG: 4.9 billion (EU15)
IIIA:67%, IIIB:27%, IIIC:6%
www.cadses.net
Case-study: INTERREG IIIC is only ERDF-funded programme, that allows
all regions and localities to build European-wide partnerships following a bottom-up approach
Projects aim at policy learning, skills development and capacity building („improving policies and instruments of regional development and cohesion“)
Method: Exchange and dissemination of Structural Funds and other relevant experiences and know-how transfer
Projects involve and/or target regional/local authorities or bodies responsible for development policies/instruments
Strong visibility, transparent procedures, proximity to project promoters
Management
Joint Technical Secretariats
North: Rostock, Germany
East: Vienna, Austria
South: Valencia, Spain
West: Lille, France
NorthEastSouthWest
Managing and PayingAuthorities are regionalpublic bodies, Monitoring and Steering Committee are representativesof Member States and Neighbouring States
TimelineProgramme start: 2002 1st call: October – Januar 20032nd call: May – September 20033rd call: March – April 20044th call: June – October/November 2004Winding up: 2008
Eligible beneficiariesPublic bodiesPublic equivalent bodies
Co-operation themesTheme Share of
operations in %
Research, Technology and Innovation 11.4 %
SME development and entrepreneurship 14.7 %
Information Society and e-Government 7.6 %
Employment, social inclusion, human resources and education
7.1 %
Environment, risk prevention, energy and resource management
16.8 %
Regional planning, territorial regeneration and urban development
19.6 %
Tourism, Heritage and Culture 19.0 %
Accessibility, mobility and transport 3.8 %
19,80047,300
76,50048,400
192,000
13,300
14,900
55,000
41,000
124,200
0,000
50,000
100,000
150,000
200,000
250,000
300,000
350,000
North East South West Total
Remaining
Allocated
Separate budget for Border Regions Remaining: 0,465 Million ERDF
Budgets
Applications - Projects
6 614 8
348
2625
18
77
10
25 15
18
68
0
50
100
150
200
North East South West Total
3rd round
2nd round
1st round
21 2793
18
159
2964
118
40
251
33
66
130
40
269
0
100
200
300
400
500
600
700
800
North East South West Total
3rd round
2nd round
1st round
Total: 83 157 341 98 679 24 57 54 44 179
Partners in approved operations
66 90 116 128
87
216210
21397
229 183
253
0
100
200
300
400
500
600
700
North East South West
3rd round
2nd round
1st round1888 partners
(incl. Lead Partners)
27 % local authorities 29 % regional authorities 7 % national authorities 37 % public equivalent bodies
49 countries
93% EU incl.
20% new MS
7% other
191 different EU regions 46 % are Objective 1Total: 250 535 509 594
3913
212323262932333439
586061626569
100104
120130
180211
253
0 50 100 150 200 250 300
LuxemburgCyprus
MaltaSlovak Republic
DenmarkLatvia
EstoniaI reland
BelgiumSlovenia
LithuaniaCzech Republic
PortugalAustria
SwedenNetherlands
FinlandHungary
PolandGreece
United KingdomFrance
GermanySpainI taly
EU Countries involved
Partners in approved operations (incl. LPs)
23
22
14
12
8
6
6
5
4
4
4
4
3
3
12
0 5 10 15 20 25
Norway
Romania
Bulgaria
Croatia
Switzerland
Algeria
Russia
Morocco
Albania
Serbia and Montenegro
Tunisia
Ukraine
Belarus
Turkey
Others
Non-EU Countries involved
Partners in approved operations
Most active regions
Lessons so far• Strong mobilisation of European regions• High interest in programme, patronage of EU is factor
for success and increased commitment• Only EU programme that stimulates strong bottom-up
activity on strategic issues• Many links and networks established• Transfer and dissemination of knowledge and
experiences that would have remained isolated • In-house capacity often weak, many equivalent
bodies, many consultants involved• Some implementation problems (management and
underspending)
What does it take?• Governance dimension, skills dimension• Multi-level game• EU-level: Regional offices, associations, networks• National level: Transparency and clear processes• Regional level: Development agencies and other
actors offering services for public bodies• Local level: Inhouse capacities in municipalities, • But consultants necessary for short-term
assingments (e.g. proposal writing)
Specific Capacity Problems
• Regions/localities eager to engage in EU projects
• Often unrealistic expections about EU funding
• Lack of project development skills
• Lack of professionality
• Lack of language skills
• Internal administrative problems (lack of leadership, coordination, etc.)
• Underdeveloped project pipeline e.g. Project Generation Facility (HU)
What can be done?• Regions and local authority associations should
offer permanent training on EU, regional development and other programme opportunities
• INTERREG good instrument, to be continued and improved (also third-country funding), in particular INTERREG IIIC
• Support of twinning in relevant policy areas for local level could be useful (current EU programmes not sufficient)
• Q for other donors: leave problem to EU and MS or step in with own activities????
Plans for the future SF?• New constitution: territorial cohesion as goal (so far:
economic and social cohesion)• Greater emphasis on spatial issues and specific
geographical handicaps• Proposal for new SF regulations• Simplifaction/Decentralisation• Strategic priorities: new objectives• Convergence (78%), Competitiveness (18%), Territorial
Cooperation (4%)• Abandons system of designated areas for thematic
approach• Thematic priorities: Lisbon/Gothenburg
•Mainstreaming Community Initiatives
•Down to 3 from 6 funding instruments•Goal: Simplification/Decentralisation•‘One programme, one fund’ rule•One document at strategic EU level,
national and regional programmes
•ERDF + ESF + Cohesion fund – same rules•Financial control: definition of minimum
set of control systems, system check, national on-spot checks and reporting
Plans for the future?
Plans for the future•75% co-funding across the board
•Co-funding only for public expenditure
•CBC: 10% may be used outside EU
•CBC: 20% may be used for adjacent areas
•TNC: 10% may be used outside EU
•TNC: 20% may be used outside progr. area
•13 TNC areas to be streamlined
•Better harmonisation across border with PAI and NNI
CB as ongoing challenge
• Political leadership and capable human resources important (e.g. cities)
• Staff fluctuation in PA often high,low salary, brain drain to private sector
• Changing EU priorities and programme frameworks
• Ongoing extension of EU acquis with impact on regions/localities
Accession Countries• Fulfil Chapter 21: national level capacity,
establishment of implementation structures• Phare continuing, from 2007 New
Instrument for Pre-Accession planned to replace Ispa, Sappard, Phare CBC, etc.
• Close to enlargement: more grant schemes, more decentralised implementatin rules
• Delivery modeled on SF (Shadowing)