A4-0258/95

Resolution on the Commission's Fifth Annual Report on the Structural Funds in 1993 (COM(95)0030 - C4-0117/95)

The European Parliament,

- having regard to the Commission's Fifth Annual Report on the implementation of the reform of the Structural Funds - 1993 (COM(95)0030 - C4-0117/95),

- having regard to the annual report of the Court of Auditors on the 1993 financial year and, in particular, Chapters 6 and 7 thereof,

- having regard to Regulation (EEC) No 2052/88 ((OJ L 185, 18.7.1988, p. 9.)) and, in particular, Article 16 thereof, Regulation (EEC) No 4253/88 ((OJ L 374, 31.12.1988, p. 1.)) and, in particular, Article 31 thereof, and Regulation (EEC) No 4255/88 ((OJ L 374, 31.12.1988, p. 21.)),

- having regard to the report of the Committee on Regional Policy and the opinions of the Committee on Agriculture and Rural Development, the Committee on Budgets, the Committee on Social Affairs and Employment, the Committee on Budgetary Control and the Committee on Fisheries (A4-0258/95),

A. whereas the Fifth Annual Report covers the final year of the initial Structural Fund reform implementation period (1988-1993) and provides an assessment, albeit incomplete, of the results obtained in that period,

B. having regard to the difficult macro-economic circumstances in which the Community's structural policies have been implemented, in particular the spectacular increase in unemployment which occurred in all the Union Member States in the period 1988-1993; whereas the economic situation should be taken into account when assessing the effectiveness of Community structural policies,

C. whereas the Structural Funds should contribute towards narrowing the gap between the regions; whereas, however, there are still considerable differences between the richest and poorest regions, despite substantial financial aid; whereas also, over the 1988-1993 period, three of the four least-developed Union Member States have maintained growth significantly in excess of the Community average,

D. having regard to the difficulties involved in carrying out a short-term assessment of many Structural Fund operations, in particular infrastructure and human resource initiatives which can only demonstrate their full effectiveness over the long term; whereas, for this reason, an assessment based solely on GDP is inadequate,

E. whereas the Structural Funds are merely one of several instruments used by the Union to strengthen social and economic cohesion; whereas all Community policies and national economic policies should take this objective into account, as stipulated in Article 130b of the EC Treaty,

F. whereas the difficulties which became apparent in the implementation of the Structural Funds during the first planning period (1988-1993) should be taken into account in the CSFs relating to the current period,

G. pending submission in 1996 of the report on cohesion which should provide definitive information on the results obtained in the period in question (1988-1993), and having regard to the Intergovernmental Conference on reform of the Treaty,

1. Deplores the considerable delay in publishing the annual report for 1993 and insists that the Commission present the 1994 report before the end of 1995;

2. Regrets that the Commission is still unable to submit a full assessment of Structural Fund implementation during the period 1988-1993 and regards such an assessment as essential if the future of the social and economic cohesion policy is to be considered in the context of the reform of the Treaties;

3. Criticizes the fact that the Commission has not made an overall assessment of operations under the Structural Funds for the entire planning period and that only individual annual reports have been submitted, with the result that a systematic analysis of the successes of the 1988 reform of the Structural Funds is still lacking;

4. Is aware of the difficulties arising from the fact that a small number of measures are still in operation after the planning period has in fact ended; considers it vital, nevertheless, that the Commission should in future submit an evaluation report immediately after the conclusion of each multiannual planning period;

5. Criticizes the incomplete and very general information provided to Parliament and calls on the Commission to supply complete and comparable data in future so as to enable Parliament to form its own judgment;

6. Reminds the Commission that very few specific and conclusive data from the Member States on the successes of the reform were available to Parliament when the 1993 revision of the Structural Funds regulations was approved and calls on the Commission to submit the main elements of that revision - i.e. greater flexibility, concentration and a new Objective 4 - to appropriate evaluation so as to prevent any future repetition (in 1999) of this unfortunate situation;

7. Considers that the Commission should provide more information and be more open about approved projects and appropriations so that it can better document the significance of the EU Structural Funds in the Member States;

8. In view of the difficulties revealed by the annual report as regards the implementation of the Funds, restates its firm belief that planning quality is a key to the effectiveness of structural policies and is convinced that this quality depends on the extent to which local and regional economic, social and political operators are involved in the planning;

9. Notes that the lack of technical capability on the part of local and regional authorities or institutional problems linked to the relations between the various levels of administration are often the root cause of poor planning, the ensuing ineffective implementation of the Structural Funds and, in certain cases, insufficient take-up of aid, and therefore considers it essential to learn from the mistakes of the past and to give a more important role to operational programmes specifically aimed at training for public officials and to technical assistance designed to support public authorities in an institutional consolidation strategy which is capable of improving the effectiveness of Community aid during the current period (1994-1999);

10. Reiterates the importance of technical assistance; agrees with the Court of Auditors that, during the previous planning period, use of such assistance was insufficient and belated and encourages the Commission to make more widespread use of the opportunities provided by technical assistance, both within the CSFs and as an own initiative, during this initial stage;

11. Regards the provision of information as essential to the full involvement of the various economic, social and political operators in the implementation of Community structural policies; considers the information work carried out by the Member States to be totally inappropriate and insufficient, the primary aim of which should be to ensure that operators with a direct interest, particularly at local level, have access to the administrative channels through which the implementation of the CSFs and the operational programmes is managed; expresses its distrust at the application of the information and publicity rules during the current 1994-1999 planning period, since these virtually ignore this kind of practical information;

12. Considers it essential, in view of the excessive flexibility with which the principle of partnership with local and regional authorities and the social interlocutors is formulated in the regulations, to strengthen the application of that principle in practice and calls on the Commission to step up direct contacts with those authorities and economic operators;

13. Stresses that the role of the monitoring committees must be strengthened;

14. Considers that the administration of the Structural Funds should be simplified as far as possible both at national and EU level;

15. Welcomes the information contained in the report on the application of Article 10 of the ERDF regulation; considers that the scattered nature of the objectives contained in that Article should be rectified during this new planning period and believes that the networks financed out of the Fund should be used primarily to improve local capacity for strategic planning and technical capability and to increase the involvement of local and regional operators in the implementation of the funds;

16. Is concerned at the application, during the new planning period, of the additionality principle, which is essential to the effectiveness of the Structural Funds, in view of the difficulties encountered in assessing the calculation thereof during the previous period, which should constitute the basis for calculating it during the current period, and also considers that the national structural effort should be analysed by region in order to ensure economic convergence between the various territories of the beneficiary Member States;

17. Notes with disappointment that the application of the additionality principle, one of the most important principles underlying the 1988 reform, has not yet been satisfactorily checked by the Commission, and calls on the latter to demand the requisite information from Member States without delay;

18. Considers the budget implementation for the 1988-1993 period to be satisfactory but is concerned at the imbalances noted in the implementation in certain areas and the delay in Objective 2, and shares the doubts expressed by the Court of Auditors regarding the excessively short planning period for that objective; also regards as unsatisfactory the irregular rate of implementation over the five years, is worried that this imbalance may recur during the current period and believes that the next reform of the Structural Fund regulations should already be under consideration sufficiently in advance to ensure that there is no break in the financing for actions carried out under the Funds and that planning can begin early enough to ensure that it is of a high standard;

19. Reminds the Commission that, two years after the end of the reform's implementation period, an enormous number of commitments remain to be implemented, which are in danger of cancellation due to expiry of deadlines;

20. Agrees with the Commission on the need to strengthen and increase on-the-spot checks; fully supports the establishment of permanent coordination between the Commission and the Court of Auditors to improve financial control, and expresses its concern at the weaknesses in national financial control systems as revealed in the report;

21. Trusts that Article 198e of the EC Treaty, which enables the EIB to finance programmes, will have a positive effect on the coordination of appropriations and subsidies, provided that appropriations for projects are authorized only if there are no other credit possibilities with more favourable conditions, and suggests to the Commission that it should try to benefit from the EIB's experience by involving it in assessment work with particular regard to major infrastructure projects, following the example of the Cohesion Fund;

22. Welcomes the fact that, owing to the problems of compatibility between actions financed by the Structural Funds and other Community policies, in particular environment policy, an environmental impact assessment must be carried out; insists that the Commission improve coordination amongst its various departments and, specifically, between DG XVI and DG XI, in order to ensure both that Community environmental legislation is scrupulously upheld and that the structural policy objectives are fully compatible with the principles contained in the Fifth Community Environmental Action Programme;

23. Notes the absence in the report of any reference to upholding legislation on public contracts and hopes that, in the next annual report, the Commission will provide information on cases detected in which investment financed by the Structural Funds has been privatised;

24. Calls on the Commission to assess, in the next annual report, the full effects of Community structural policy on employment, in particular the creation of stable new jobs, through measures to develop not just human resources but also infrastructure;

25. Calls on the Commission, when assessing the progress achieved with structural measures, to use other indicators which measure not only economic growth but also the degree of environmental quality and the stability of long-term jobs; for this purpose, for example, the indicators referred to in paragraph 39 of this resolution should be used;

26. Notes that the Commission touches upon management problems which could concern the very legality of the implementation of the Funds (transparency of administrative and accounting procedures, contracts, invitations to tender and contract awards) and calls on the Commission to submit a specific detailed report on the subject, pending the special report of the Court of Auditors on irregularities and fraud in the sector of the Structural Funds, which was requested in its resolution of 5 April 1995 containing the comments which form part of the decision giving discharge to the Commission in respect of the implementation of the general budget of the European Communities for the 1993 financial year ((OJ C 109, 1.5.1995, p. 59.)), before proposing legislative or financial measures to combat this alarming phenomenon;

27. Calls on the Commission to do its utmost to ensure compliance with the time limits laid down in Community legislation for disbursement of funding to national authorities and by them to the final beneficiaries, but reiterates that, at all events, legislative reform is called for with a view to:

- making it compulsory for funding which has been disbursed to be deposited with the central bank at predetermined rates until the time of disbursement to the final beneficiary;

- making it compulsory to spend the interest generated in this way on the operation for which the funding is intended;

28. Calls on the Commission to take measures to strengthen the existing control systems at both national and Community level, particularly by:

- increasing the number of on-the-spot checks and coordinating them better;

- decisive action in partnership to rationalize national control systems, inter alia by amending legislation so as to render Article 24 of Regulation 4253/88 applicable if a national system is inadequate;

29. Takes the view that assessment of the results of the Funds in relation to their structural objectives is an essential precondition for support from the Community and European public opinion; calls, therefore, on the Commission to undertake to provide in the near future:

- an assessment of the impact of the Funds on long-term supply and relevant macroeconomic variables (investment, employment, the trade balance, etc.);

- detailed assessments of the internal rate of return, both financial and economic, of the projects funded;

Observations regarding the ESF

30. Criticizes the fact that the data concerning women's participation in ESF co-financed projects are inadequate;

31. Shares the Commission's view that priority should be given to investment aimed at the development of human resources in view of continuing mass unemployment, and calls on the Commission to act in accordance with its own stated views;

32. Underlines its view that ESF investment aimed at 'combating long-term unemployment' and 'facilitating the occupational integration of young people' (formerly Objectives 3 and 4, now Objective 3) should increasingly lead to an active labour-market policy rather than merely an income-support policy;

33. Expects the Commission to ensure that the aims of operations are specified and quantified in the 1994-99 Community Support Frameworks and operational programmes so as to facilitate satisfactory ex-post assessment of operations;

34. Calls for the active involvement of the social partners and bodies responsible for training and employment issues at local level, particularly in operations to promote human resources;

35. Notes that no information is supplied on the conclusions reached by the assessment of the specific operations EUROQUALIFICATION and SOCIAL DIALOGUE (Article 1(a) and (c) of Regulation (EEC) No. 4255/88) in 1993 and calls on the Commission to ensure greater transparency in this area;

36. Criticizes the fact that the report does not contain accurate, complete and comparable - and thus usable - data and summaries concerning, for example, placement rates and drop-out quotas with regard to ESF measures, which makes in-depth evaluation and assessment impossible;

37. Criticizes the lack of information in the annual report on the impact on employment of Community initiatives in favour of human resources, particularly in view of the fact that these initiatives experienced delays in implementation and were criticized by the Court of Auditors for their bad management;

38. Expects the Commission to submit promptly detailed verification reports on compliance with the principle of additionality of resources, particularly in the context of demanding the repayment of funds;

39. Calls, particularly as regards evaluating the progress made with ESF contributions, for more meaningful indicators to be used than the rate of growth of GDP, the rate of unemployment or the ESF's contribution to public investment aimed at promoting employment and combating unemployment; some starting-points might be, for example:

(a) the situation on the labour market:

- trends in unemployment rates (particularly within the groups targeted by ESF operations),

- trends in overall employment and job vacancies;

(b) level of qualifications:

- changes regarding academic and professional qualifications in the Member States and regions, particularly levels of training among young persons, the long-term unemployed and groups of people who are at a disadvantage in the labour market,

- the number of people benefiting from ESF grants (overall and by year),

- the cost of training, retraining and further training measures per participant, broken down by type and scope of support measure;

(c) information on the evaluation of the content of support schemes

- number of persons who were forced to drop out of a support scheme and therefore failed to obtain the intended qualification,

- data on placement quotas in regular training schemes for participants in basic training schemes,

- data on placement quotas in further qualification schemes following a vocational training scheme supported by the ESF,

- job placement quota for former participants in a support scheme;

(d) developments as regards the range of incomes and wages;

40. Shares the Commission's view that, in view of experiences with the Objective 2 regions, preventive actions and support for occupational mobility remain vital in the future in order to facilitate structural change in these regions and provide an employment policy to accompany such change;

41. Underlines once again, with regard to the practical implementation of the new Social Fund regulation, the importance of an integrated approach geared to the individual needs of the unemployed, e.g. by means of an analysis of existing qualifications, careers advice and schemes combining theoretical training and work experience;

42. Stresses the need to ensure that training and further training schemes co- financed by the ESF lead to recognized qualifications in all the Member States.

43. Instructs its President to forward this resolution to the Commission and the Council.