Brussels, 22/03/2010 (Agence Europe) - On Thursday 18 March, the European Parliament regional development committee agreed its first reading position on the proposal for simplifying structural funding presented by the European Commission in July 2009, with a view primarily to easing the effects of the economic and financial crisis. The report by Evgeni Kirilov (S&D, Bulgaria) was adopted by 36 votes to 4, with 1 abstention, in committee, and is expected to be passed in Parliament on 21 April.
The committee intended initially to remove the requirement for member states to co-fund projects receiving European social fund aid, in 2009 and 2010, but these arrangements were withdrawn in the face of the strong opposition from member states.
In practical terms, the new regulation will allow countries badly hit by the economic downturn to receive advance payments - in a sense, pre-financing that will mean that projects can be started more quickly - of 2% from the European social fund (€1.4 billion) and 4% from the cohesion fund (€1.8 billion). The countries which are eligible are those whose GDP fell by more than 10% in 2009 compared with 2008, or those which, in 2009, received money from the EU loan mechanism to support the balance of payments in non-euro area countries. In 2009, as a result of the crisis, the Commission made additional advance payments worth €6.25 billion (in addition to the €5 billion initially planned under structural fund rules). Professional training, apprenticeships for young people, public works and other projects to boost employment and growth could, with these advances, be implemented much more quickly. In addition, public projects which would have been abandoned for lack of sufficient national or regional funding, will be able to continue.
More time for funds to be spent. The regulation will also ease the “de-commitment” of funds, to give member states more time and more flexibility in completing projects that have taken longer to get under way because of the crisis. Under current rules, member states lose the funding granted for a programme if it is not used within two years of the approval of the funding request (the time allowed is three years for the 12 “new” member states, Portugal and Greece). The new rules will mean that member states will not lose the funding they committed in 2007 for projects whose implementation has been delayed.
Improving synergy between funds. A single threshold of €50 million has been agreed for the approval of “major projects”, which will now be eligible for funding from more than one EU programme. This is of particular importance for saving nation-wide or EU-wide projects straddling several regions which otherwise would have to be artificially separated into multiple projects. Projects to boost energy efficiency and the use of renewable energies in housing, two sectors that have great potential in terms of growth and jobs, will also be encouraged to make use of the multi-instrument financing.
MEPs are now keen to see these simplified rules and procedures come into force as soon as possible, to enable those member states and regions that have been hit by the crisis to benefit fully from the easing of procedures. After the plenary session vote in a month's time, the EU Council of Ministers is likely to approve the agreement as quickly as possible. (L.C./transl.rt)