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Countries not spending enough EU regional money

Published 01 April 2010 - Updated 07 April 2010
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A report assessing member states' use of EU regional funding showed mixed results across the EU 27, the European Commission said, urging laggards such as Poland to speed up use of money provided by Brussels.

Presenting the report on Wednesday (31 March), the Commission explained that the report was the first of its kind and that it hoped it would inject a new level of transparency into the notoriously complex regional policy bureaucracy.

The EU executive notes that "on average across the EU, more than 27% of funding for the 2007-2013 period has already been allocated to specific projects - amounting to an investment of more than €93 billion".

In other words, three quarters of the vast regional funds purse remain untapped halfway into the current programming period (2007-2013).

Questioned by journalists as to whether this figure indicated positive or negative overall trends, EU Regional Policy Commissioner Johannes Hahn was non-committal, claiming that this figure was broadly similar to the previous period.

Commission officials, speaking to EurActiv on condition of anonymity, were less diplomatic, stating that "of course we'd prefer this figure to be higher". They argued, however, that given the debilitating effects of the economic crisis, the figure could in fact have been much worse and must be considered in that light.

You still have time…but not much, warns Hahn

The report showed a very mixed performance across the EU 27. Net contributors to the EU budget such as Belgium, Ireland and the Netherlands came out on top, with average rates of between 50 and 60%.

On the other hand, the main net recipient of regional funds, Poland, reported a comparatively low take-up rate of only 19%, seemingly at odds with recent claims by the country's regional affairs minister that "Poland's use of EU funding has been the most efficient of all new member states" (EurActiv 04/03/10).

Asked whether Poland could lose large chunks of its vast 67 billion euro allocation for the 2007-2013 period, Hahn coyly replied that "you still have time, but not a lot of it" to play catch-up.

The commission officials, again, were more forthright. "If you were below the EU average (27%), you have to make a far greater effort," they argued, adding that "some member states are going to have a very tough time absorbing the money available to them".

Earmarking works, claim commissioners

A second major conclusion emphasised by the Commission is that the EU's earmarking policy – targeting funds towards achieving specific EU strategic development goals – is working reasonably well.

In particular, progress has been positive in important areas such as research and development (R&D), innovation, lifelong learning and active labour market policies, policy priorities defined by the Lisbon strategy for growth and jobs, it noted.

But more should be done to accelerate project implementation in the rail sector, in key energy and environment investments, in the digital economy, and in support of social inclusion, according to the Commission.

The EU executive argued that member states should further target these priority areas, if necessary, by putting in place action plans to overcome delays in funding related projects.

Positions: 

EU Regional Policy Commissioner Johannes Hahn said: "This report is a new feature for cohesion policy. It puts into practice our ambition to establish a robust system for the delivery of structural fund investments during the programming period. The global economic crisis has obviously had an impact upon implementation. However, the overall picture is positive. It shows cohesion policy is successful in investing in regions." 

"Delivery of the agreed strategies is being put in place at a good pace, with progress in key sectors such as Research & Development and innovation particularly encouraging. Member states now have to move forward and improve the implementation of programmes," Hahn said.

EU Commissioner for Employment, Social Affairs and Inclusion László Andor said: "The training and up-skilling offered by the European Social Fund to people looking for work is progressing and bearing fruit. But more can be done to help those hit hardest by the downturn. Member states need to step up investments, especially inthe area of social inclusion and institutional capacity building so that they can run programmes effectively".

He added: "The crisis has proven the relevance and value of the European Social Fund when we see that the measures most resorted to have been active labour market policies to get people into work."

EU regional policy chief Hahn
Background: 

Regional funds account for approximately a third of the total EU budget, a total of around €347 billion for the 2007-2013 period. 

According to the European Commission, the bulk of regional policy money (around €230 billion) have been earmarked for investment in the key areas of the growth and jobs agenda.

The report by the Commission assesses, for the first time, the rate of progress of each country on delivering agreed EU objectives.

It also contains an "indicative selection of 40 project examples to show the broad range of investment priorities" (see memo).

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