Strategic reports from EU Member States on cohesion policy 2007-2013 - briefing

31 March 2010
by eub2 -- last modified 31 March 2010

EUR 93 billion or 27 per cent of EU funding has been allocated to projects for investment in jobs and growth in Europe over the last three years, according to a report adopted today on the EU's cohesion programmes for the 2007-2013 period. The report assesses, for the first time, the rate of progress of each country on delivering agreed EU objectives. It shows how well EU Member States aligned their programmes to EU goals of jobs and growth and contributes to an open debate on achievements and challenges of cohesion policy programmes. Furthermore the report calls on Member States to improve the implementation of programmes, to make optimal use of the cohesion money, for instance in the rail sector, key energy and environment projects and the field of social inclusion.

What is cohesion policy?

Cohesion policy is the European Union's strategy to promote and support the overall social and economic development of its Member States and regions. The policy aims to reduce differences in the level of development of Europe's regions, focusing on key areas that will help the EU tackle the challenges facing it and remain globally competitive.

Approximately 35.7% of the EU budget 2007-13 (equivalent to ca. €347.41 billion over seven years at 2008 prices) is allocated to financial instruments which support Cohesion Policy (i.e. the European Regional Development Fund, the European Social Fund and the Cohesion Fund). These are managed and delivered in partnership between the European Commission, the Member States and stakeholders at the local and regional level.

What is the purpose of the national and EU strategic reports on cohesion policy?

The main purpose of the strategic reporting is to increase the transparency and accountability of cohesion policy, as well as to encourage the ownership of the policy at the national and regional level. It also aims to promote a high level debate on cohesion policy implementation among the stakeholders at both a European and national level.

Following the analysis of the 27 national strategic reports, the EU strategic report provides, for the first time, an overview of the implementation of the cohesion policy programmes 2007-2013 at the mid-term juncture. It gives an overview of the progress of Member States towards achieving the European Union's goal of social and economic cohesion as well as overarching EU priorities of growth and jobs. It is also a useful basis for Member States to improve performances and will act as an impetus for results-oriented policies. It offers real-time data on projects in the pipeline.

The 27 national reports are available here

What is the relevance of "selected projects"?

Reporting on project selection gives an insight into the 'project pipeline' of the programme, meaning it gives an idea of the type of projects being funded and how much of the funds made available by the EU has been committed to projects. The reports submitted by the Member States indicate that, EU-wide, projects selected so far amount to more than €93 billion or 27% of the total allocation under cohesion policy 2007-2013.

The term "selected projects" means that they have been selected by the 'managing authorities' (i.e. a national, regional or local public authority or public/private body) responsible for implementing cohesion policy at a regional or national level. This does not necessarily imply that implementation is actually underway, nor that payments have been made to the project holders on the ground. The selection process can differ from one Member State to another as this is not defined at an EU level.

Why does this check on the use of investment take place after 18 months?

This 2006 Regulation on the Structural Funds set out a requirement for national governments to submit strategic reports by the end of 2009 (and again in 2012). The Commission requested the Member States to provide data as per the situation on 30 September 2009.

Cohesion policy is aligned to the financial framework of the EU budget which is agreed for the seven year period 2007-2013. The steps needs to prepare the programmes involved reaching agreement between the European Parliament, Council (Member States) and the Commission on the Community Strategic Guidelines (the EU-level guidelines on the policy), setting the national priorities of each country (2006-2007), and the adoption of the 455 cohesion policy programmes (mid-2007 to early 2008). De facto, in the light of the different steps required, active implementation started around March 2008 on average.

Can direct comparisons be made across Member States?

It is more relevant and reliable to compare the progress of individual Member States with the EU average. Caution should be exercised when making direct comparisons between Member States as although the Commission requested data corresponding to how the situation stood on 30 September 2009, some Member States chose to send data extracted on other dates. Differences of several months could influence the volume of allocations made to a particular sector.

Concepts and practices of project selection also vary between Member States, with particular regional and national procedures playing an important role in selection.

Why can we not compare the current progress with the previous period?

The requirement for the national strategic reports was introduced for the first time for the programming period 2007-2013. The new form of reporting is facilitated by the setting of certain target levels of EU priority investments – the so-called "Lisbon earmarking" - where Member States committed themselves at the outset to investing specific shares of their total investment on key priority themes, such as R&D and innovation.

The programmes from the previous period (2000-2006) are governed by a different set of rules. In addition, the start of the previous programming period covered only the EU-15 and a different set of funds (e.g. funds to support fisheries and rural development were previously part of cohesion policy), making comparisons even more difficult.

What is the level of progress in selecting projects?

In the context of the financial and economic crisis and the reform made to the policy for the period 2007-2013, the progress on average is reasonable and approximately on track. However some Member States are behind the 27 % EU average for project selection. They run the risk of major delays in investing the funds made available by the EU and not reaching important objectives.

Practically all Member States have reported such delays in some priority areas or another. This is why implementation of all projects selected must be accelerated and the rest of the project pipeline prepared and selected as quickly as possible.

Reported rates of project selection by Member State:

AT: 20,5% BE: 61,1% BG: 20,2% CY:42,3% CZ: 21,6% DE:19,3% DK:30% EE:52,3% EL:11,9% ES:29,1% FI: 31,7% FR: 26% HU: 46,3% IE: 51,8% IT: 38% LT: 35,4% LU:28,6% LV:36,9% MT:48,7% NL:55,8% PL:19,5% PT:38% RO:14,1% SE:48,5% SI:42,2% SK:18,6% UK:35,2% EU: 27%

(NB – Six Member States (DE, EE, EL, ES, FR, SI) have provided their data on allocation to selected projects on dates other than 30/09/09).

What can the Commission do to help Member States which are progressing slowly?

A number of measures have already been taken in the context of the European economic recovery plan to boost investment. For instance, the Commission made some additional advance payments to the 2007-2013 programmes. These payments provided an immediate cash injection of €6.25 billion in 2009 for investment, within the financial envelope agreed for each Member State for 2007-2013.

In view of the challenge to ensure sufficient co-funding in these times of public budgetary pressures, Member States can vary the proportion of EU and national contributions for individual projects under a programme: for example some operations may be financed at a rate of 100% by cohesion policy funds in 2009 and 2010.

The Commission is also willing to work closely with regional and national authorities to address bottlenecks identified in programme delivery.

Other measures taken under cohesion policy in response to the economic crisis

What is the impact of cohesion policy?

Generating impacts takes time and can only be demonstrated through evaluations. It is too early to assess the investment made so far in the regions under cohesion policy 2007-2013. However, the evidence that the policy works on the ground is provided by the evaluations on 2000-2006 programmes which are now available. On 19 April 2010, the Commission will publish a synthesis report analysing these results.

For instance:

*  Between 2000 and 2006 cohesion policy provided 4% of all investment in transport in Europe and 18% in the EU10;
*  730,000 gross jobs were created in "Objective 2 regions" (targeting at declining industrial and rural areas, and urban districts in difficulty);
*  20 million additional people were served by waste water projects, half of the increase in Europe in the period;
*  The European Social Fund (ESF) is the main European tool for investing in citizens and job skills: 9 million people are supported every year. The current economic crisis has showed the importance of ESF interventions in combating unemployment and supporting vulnerable groups;
*  Between 2000 and 2006 more than 75 million people were involved in ESF activities. This corresponds to about 24% of the total population between 16 and 64 years in the EU;
*  It is estimated that on average roughly half of those unemployed find work within 12 months of participating in an ESF training programme.

EC, further information

How do the funds support employment and the Europe 2020 strategy?

The Commission proposal for a new Europe 2020 strategy entails several proposals as part of flagship initiatives to make or reinforce EU instruments available for combatting rising unemployment. The Flagship Initiative "An agenda for new skills and jobs" proposes to facilitate and promote labour mobility across the EU and better match labour supply with demand with appropriate financial support from the structural funds, notably the ESF. The Flagship Initiative "Innovation Union" proposes to strengthen the role of structural funds, rural development funds and Research & Development (R&D) framework programme in supporting innovation. The Flagship Initiative "A digital Agenda for Europe" proposes to facilitate the use of EU's structural funds in pursuit of this agenda.

What is the planned follow-up to the national and EU strategic reporting?

The Commission encourages Member States and regions to accelerate project implementation and target fields that are performing slowly (rail sector, certain energy and environmental investments, digital economy, social inclusion, governance and capacity building). Member States are advised to develop action plans in order to correct the delays in investing the EU funds and to deliver the agreed results. The Commission also calls on the Member States to secure national co-financing of projects and promote a public debate with policy stakeholders. The effective implementation of Cohesion policy programmes will then make an important early contribution to Europe 2020 agenda.

The Commission's Communication on the Strategic Report 2010 will be discussed at the European Parliament, the Council and the European Economic and Social Committee and the Committee of the Regions. In 2013, the Commission will prepare the second strategic report on the implementation of the programmes 2007-2013.

Source: European Commission