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European Commission

MEMO

Brussels, 11 March 2014

Task Force for Greece: well-targeted and well-resourced assistance supporting vital reforms

What is the role of the Task Force for Greece?

The Task Force for Greece (TFGR) was launched by President Barroso in July 2011 to provide technical assistance to the Greek authorities. The Task Force mobilises expertise from Member States, international organisations or other specialist bodies and coordinates technical assistance (TA) requested by the Greek authorities as they work to implement structural reform commitments under the Economic Adjustment Programme for Greece.

The technical assistance TFGR provides is a resource available for the Greek authorities as they seek to strengthen their public administration, modernise their regulatory system and lay foundations for new growth model based on enterprise and investment in line with the Economic Adjustment Programme. The provided expertise is used to design and implement reforms of legislation, institutions and/or working methods and processes.

In this respect, the following objectives underpin all TFGR activities that support Greece in their wide-ranging reforms:

  • Build and strengthen the capacity of the Greek administration to prepare and implement structural reforms for the better functioning of the economy and create the conditions for a sustained economic recovery and job creation.

  1. Speed up the targeted absorption of EU Structural and Cohesion Funds. Structural and Cohesion Funds are vital resources to boost economic competitiveness, job creation and social progress.

What are the working methods of the Task Force?

The Task Force has around 60 people based in Athens (30 staff) and Brussels (30 staff). They are made up of staff from the European Commission, seconded experts from a number of Member States or from other organisations with specific expertise, such as advisory support for structural reforms or administrative capacity building.

Technical assistance may take the following forms:

  1. Expert missions/workshops to share experience and exchange best practices: Experts have been provided mostly by 25 Member States and international organisations such as the European Investment Bank, the European Investment Fund, OECD, Council of Europe, IMF, the United Nations Economic Commission for Europe, the World Bank, and the European Bank for Reconstruction and Development. Most EU experts come from Austria, Belgium, France, Germany, the Netherlands, Spain and Sweden. Until now, TFGR has arranged over 400 missions on a wide range of subjects, including 35 policy workshops relating notably to judicial system reform, revenue administration, public procurement and business environment. Such short-term TA is financed through resources available in the TA budget of the European Commission, such as the European Social Fund (ESF) or the EU Fiscalis Programme whose focus is to facilitate the exchange of information and expertise between national tax administrations.

  1. Support through small value contracts: This allows more intensive support for specific projects in a short period of time. TFGR has made increased use of small value contracts funded by the European Social Fund (ESF). This type of assistance allows experts to work with Greek project teams over a 3-4 month period to evaluate, design or implement specific reforms. To date, 52 such contracts totalling €638,000 have been arranged by the TFGR. Over this reporting period we had a 44% increase in the use of this financing instrument with 16 additional contracts, amounting to around €220,000.

  1. Continued support from international or national organisations with specialised know-how in complex reform/change management. Continued presence is needed as appropriate to help to implement complex reform projects and steer change management in the Greek public administration, specifically to closely assist the Greek project managers. The TFGR has so far arranged 10 grants or contribution/delegation agreements with international organisations (such as IMF and World Bank Group) as well as national public bodies (such as ADETEF) for TA to Greece for an amount of €10.4 million. Additional efforts will be deployed for effective use of eligible funds for TA through 3 additional grants in the areas of revenue administration, improving business environment and reform of land use and planning as well as reform of the cadastre (land administration) totalling €2 million.

  2. "Domain leadership": In some instances, a Member State with a strong track record in a particular policy area has become so-called "domain leader". Domain leaders have mainly come from France, the Netherlands, Germany, Spain and Belgium.

Which reforms does the TFGR support?

TFGR is now active in the following areas:

  1. Acceleration of cohesion policy projects;

  2. Financial institutions/access to finance;

  3. Reform of public administration;

  4. Revenue administration and public financial management;

  5. Anti-money laundering and anti-corruption;

  6. Business environment;

  7. Healthcare reform;

  8. Reform of the judicial system;

  9. Labour market, social security, innovation and education;

  10. Migration, asylum and borders;

  11. Privatisation and land registry

  12. Energy, transport and environment.

In these 12 areas, the TFGR has coordinated and organised technical assistance for 110 projects.

Examples of high-impact reforms supported by technical assistance:

1. Unlocking infrastructure investments

Work on four large motorways, with a combined value of EUR 7.6 billion, was suspended for over three years due to the economic crisis. Now an agreement between the concessionaires and Greek Government has been achieved and ratified by the Greek Parliament in December 2013. Following that, EU clearance was provided and EU financial support confirmed. This paved the way for an effective restart of all four projects in 2014. Throughout this process, TFGR advised the Greek authorities in their negotiations with the different parties.

2. Reform of central government administration

The TFGR, and France as a domain leader, have provided strong support for Greece to design more efficient reform of central government Ministries and bodies. Technical assistance has helped to put together a framework for a new inter-ministerial coordination General Secretariat under the Prime Minister's authority as well as to the design of a more comprehensive two-year action plan for central administrative reform and reorganisation. Support was provided to design the procedures to be adopted for selecting senior managers (General Directors, Directors, Heads of Departments). It has contributed to the preparation of an e-Government strategy to be adopted by the Government Council of Reform (as a major component of the Greek Digital strategy).

3. Revenue administration

Technical assistance from the IMF, TFGR and European Commission Directorate-General for Taxation and Customs Union, with the help of Member States such as Belgium, has been supporting a variety of far-reaching changes, including the definition of a new organisational set-up enabling a greater control of headquarters over the network of local tax offices, adoption and implementation of a new Tax Procedure Code, and adoption of new tools for collection (e-garnishment).

4. Anti-money laundering and anti-corruption

Further to the agreement on a work programme, implementation of most of the actions of the national anti-corruption strategy has begun. Training in anti-money laundering techniques has been provided to over 700 officials. Through such training, technical assistance has been able to enhance the capacity of Greece's Financial Intelligence Unit (the anti-money laundering and counter-terrorism funding authority), resulting in the reporting of 1446 cases of suspected tax evasion to the authorities, transmission of 405 cases to the Prosecutor's Office and freezing of assets worth EUR 170 million since early 2012, up from EUR 133 million in the previous review period.

5. Barriers to competition

TFGR extensively supported an assessment carried out by the OECD to remove/simplify legislation which limits competition in key sectors of the Greek economy: food, retail trade, building materials and tourism. Adopting the OECD's recommendations to remove inadequately designed regulation and correct disproportionate interventions in the economy which benefit the few at the expense of the many, would have significant effects: they would bring benefits to consumers by lowering prices, by improving labour productivity and job creation, and enabling Greek companies to compete more effectively on the European and global markets.

Conservative estimates quantified at some EUR 5.2 billion1 the annual positive effects on consumer surplus, increased expenditure and higher turnover in the four sectors detailed above, as a result of removing current regulatory barriers to competition. Based on the OECD report, the Greek authorities are preparing, in accordance with the economic adjustment programme, an ‘omnibus law’ amending the current legislation to remove or reduce the obstacles identified by the OECD.

6. Public health

Technical assistance from the TFGR, the World Health Organisation and the German domain leader has been instrumental in developing a clear strategic vision for the reform of the healthcare system. The strategy was launched at the High Level Conference on Health in Action on 12-13 December 2013; its first concrete milestone was the approval, on 6 February 2014, of the law on the purchaser/provider split of EOPYY (the national organization for the provision of healthcare services), a crucial step towards the building of an efficient primary healthcare service that is accessible to everyone.

7. Institution for Growth in Greece

Significant steps have been taken towards setting up an Institution for Growth (IfG), for which the legal framework was adopted by the Greek Parliament in December 2013. The IfG aims to help the Greek economy - notably Greek SMEs - to have better access to financing. The Hellenic Republic will invest up to EUR 350 million in the IfG. Together with the commitment from the German KfW (EUR 100 million) there will be at least EUR 450 million available for financing of the Greek real economy. Further contributions to IfG from other Member States and foundations cannot be ruled out. Implementation of the IfG is under preparation and should start its activities in the first half of 2014.

8. Use of the EU Structural Funds

Over the past two years, Greece has significantly improved its use and spending of EU Structural Funds, with major support and coordination by TFGR. The country has moved up to 4th place among all 28 EU Member States for absorption of Structural and Cohesion funds, up from the 18th place at the end of 2011. Improvements have been particularly noted in the areas of digital convergence (see below), transport infrastructure, and employment.

9. Digital Convergence

With sustained efforts and the support of Jaspers facility2, three major projects (digital school, e-ticket and Syzefxis) have been approved by the European Commission. A fourth one has been tendered by the Greek Authorities.

This report offers some examples of the usefulness and importance of well-targeted and sufficiently resourced technical assistance that support the vital reforms of the Greek economy under the economic adjustment programme. Technical assistance continues to be an enabler of change, but implementation of reforms depends critically on the effective use of this assistance by the Greek authorities and the availability of the related financing.

1 :

The OECD report can be accessed at:

http://www.oecd.org/daf/competition/Greece-Competition-Assessment-2013.pdf

2 :

JASPERS is a partnership between the European Commission (Directorate General for Regional Policy), the European Investment Bank (EIB), the European Bank for Reconstruction and Development (EBRD) and Kreditanstalt für Wiederaufbau (KfW). It is a technical assistance facility for the twelve EU countries which joined the EU in 2004 and 2007. It provides the Member States concerned with the support they need to prepare high quality major projects, which will be co-financed by EU funds.


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