Brussels, 22 July 2009
The European Commission proposes simplifying the management of the European Funds to assist regions in tackling the crisis
The European Commission today adopted new measures aimed at simplifying management rules for the Cohesion Policy. In the context of the current crisis, the aim is to boost the European economy by improving the conditions for launching more projects in the regions. As part of the measures to combat the crisis, the Commission may reimburse 100% of the costs declared by the Member States for projects financed by the European Social Fund (ESF) in 2009 and 2010.
The Member of the Commission responsible for Regional Policy, Pawel Samecki, stated that: 'These new measures are intended to lend a hand to the regions of Europe to help them to recover more quickly. We are facing up to the current situation while continuing in the long term to accelerate the implementation of our policy and facilitate the management of the Fu nds'.
The Member of the Commission responsible for Employment, Social affairs and Equal opportunities, Vladimír Š pidla, responsible for the European Social Fund (ESF), added that: ' Given the rapid increase in unemployment in Europe at a time when state budgets are under strain, the Member States must be in a position to make full use of the ESF. Total reimbursement under the ESF is therefore vitally important for supporting citizens in a time of crisis. These exceptional measures are an expression of European solidarity with those who are most vulnerable' .
The changes announced today are intended to facilitate the implementation of the 455 Cohesion Policy programmes planned for 2007-2013, representing a total investment of €347 billion, or more than a third of the Community budget. The aim is to accelerate investment flows directed particularly towards project promoters and those citizens most affected by the crisis in the regions of Europe.
Account also needs to be taken of the impact of the crisis on the public finances of Member States and regions encountering difficulties in providing additional financing for European investments. In particular, the Commission is witnessing a slow start-up of major infrastructure projects.
The changes introduced clarify certain rules and simplify the day-to-day management of the European Funds. The principal measures are:
In 2009 and 2010, as part of its 'anti-crisis' measures, the Commission may at the request of the Member States reimburse 100% of the public costs declared by the Member States for projects financed by the ESF. Specifically, Member States will not be obliged to provide national cofinancing, thus speeding up the implementation of projects to support employment. This option does not call into question the distribution of the Funds between the Member States, nor the total budget for the Funds, nor the obligation for Member States to provide subsequent cofinancing.
The Commission proposes establishing a single category of ' major project '. Previously, the Commission's approval was required for projects where the total cost exceeded € 25 million for the environment and € 50 million for other sectors. The threshold for approval is now set at € 50 million for all areas . Smaller-scale environmental projects will therefore be able to start up more quickly.
The rules relating to ' revenue-generating ' projects (for example, toll motorways or projects involving the leasing or sale of land) are also simplified in order to reduce the administrative burdens on the Member States.
Cohesion Policy programmes may be simplified by Member States to take account of the new realities. In addition, certain provisions concerning the obligation to maintain investments over a five-year period will not apply to undertakings which go bankrupt .
Investments in sectors linked to energy efficiency and the use of renewable energies in housing will be encouraged, given their considerable potential to provide growth and jobs.
The Commission proposes a modification aimed at increasing flexibility with regard to the rules on decommitment . For example, grants for a major project will in principle be protect ed as soon as the Member State submits the project to the Commission. Grants are currently only protect ed once the Commission has approved the project.
The European Regional Development Fund (ERDF) will be able to support the renovation or construction of housing for communities faced with social exclusion, particularly Roma, in both rural and urban areas. Previously, the construction of housing was ineligible under the ERDF and only housing in urban areas was eligible for renovation.
The Member States and the European Parliament had called for simplified management of the Cohesion Policy, particularly in the context of the crisis. They have to give their opinion on the measures presented today.
A large number of other initiatives have been taken since the beginning of the crisis under the European Economic Recovery Plan:
The EU is tackling the social dimension of the economic crisis: