EN    EN EN 
 
EN    EN  EUROPEAN COMMISSION 
Brussels, 21.10.2010 
SEC(2010) 1231 final 
  
COMMISSION STAFF WORKING DOCUMENT 
accompanying the 
 
ANNUAL REPORT ON THE COHESION FUND (2009) 
   
[COM(2010) 589 final]
 
EN 2   EN TABLE OF CONTENTS 
1. General Context ........................................................................................................... 6 
1.1. Convergence and economic development in the beneficiary Member States.............. 6 
1.1.1. Greece .................................................................................................................. ........ 6 
1.1.2. Spain................................................................................................................... .......... 7 
1.1.3. Portugal ................................................................................................................ ........ 8 
1.1.4. Cyprus .................................................................................................................. ........ 9 
1.1.5. Czech Republic .......................................................................................................... 10 
1.1.6. Estonia................................................................................................................. ....... 11 
1.1.7. Hungary................................................................................................................. ..... 12 
1.1.8. Latvia.................................................................................................................. ........ 13 
1.1.9. Lithuania ............................................................................................................... ..... 14 
1.1.10. Malta .................................................................................................................. ........ 15 
1.1.11. Poland................................................................................................................. ........ 16 
1.1.12. Slovakia............................................................................................................... ....... 17 
1.1.13. Slovenia............................................................................................................... ....... 18 
1.1.14. Bulgaria............................................................................................................... ....... 19 
1.1.15. Romania ................................................................................................................ ..... 20 
1.2. Conditionality............................................................................................................ . 21 
2. Financial implementation of the 2000-2006 period in 2008 and closure of projects. 22 
2.1. Payments made in 2009 for projects  adopted under the 2000-2006 period............... 22 
2.2. Commitments outstanding from the 2000-2006 period ............................................. 24 2.3. Closure of projects from the 2000-2006 period ......................................................... 25 3. Implementation of the 2000-2006 projects by Member States .................................. 27 3.1. Greece .................................................................................................................... .... 27 
3.1.1. Environment............................................................................................................. .. 27 
3.1.2. Transport ............................................................................................................... ..... 27 
3.2. Spain..................................................................................................................... ...... 28 
3.2.1. Environment............................................................................................................. .. 28 
3.2.2. Transport ............................................................................................................... ..... 29 
 
EN 3   EN 3.3. Portugal .................................................................................................................. .... 29 
3.3.1. Environment............................................................................................................. .. 29 
3.3.2. Transport ............................................................................................................... ..... 30 
3.4. Cyprus .................................................................................................................... .... 31 
3.5. Czech Republic .......................................................................................................... 31  
3.5.1. Environment............................................................................................................. .. 31 
3.5.2. Transport ............................................................................................................... ..... 31 
3.6. Estonia................................................................................................................... ..... 32 
3.6.1. Environment............................................................................................................. .. 32 
3.6.2. Transport ............................................................................................................... ..... 32 
3.7. Hungary................................................................................................................... ... 32 
3.7.1. Environment............................................................................................................. .. 32 
3.7.2. Transport ............................................................................................................... ..... 33 
3.8. Latvia.................................................................................................................... ...... 33 
3.8.1. Environment............................................................................................................. .. 33 
3.8.2. Transport ............................................................................................................... ..... 34 
3.9. Lithuania ................................................................................................................. ... 34 
3.9.1. Environment............................................................................................................. .. 34 
3.9.2. Transport ............................................................................................................... ..... 35 
3.10. Malta .................................................................................................................... ...... 35 
3.10.1. Environment............................................................................................................ ... 35 
3.10.2. Transport .............................................................................................................. ...... 36 
3.11. Poland................................................................................................................... ...... 36 
3.11.1. Environment............................................................................................................ ... 37 
3.11.2. Transport .............................................................................................................. ...... 37 
3.12. Slovakia................................................................................................................. ..... 38 
3.12.1. Environment............................................................................................................ ... 38 
3.12.2. Transport .............................................................................................................. ...... 38 
3.13. Slovenia................................................................................................................. ..... 38 
3.13.1. Environment............................................................................................................ ... 39 
3.13.2. Transport .............................................................................................................. ...... 39 
 
EN 4   EN 3.14. Bulgaria................................................................................................................. ..... 40 
3.14.1. Environment............................................................................................................ ... 40 
3.14.2. Transport .............................................................................................................. ...... 40 
3.15. Romania .................................................................................................................. ... 40 
3.15.1. Environment............................................................................................................ ... 41 
3.15.2. Transport .............................................................................................................. ...... 42 
4. Monitoring, inspections, financial corrections and irregularities............................... 42 
4.1. Monitoring: committees and missions ....................................................................... 42 4.1.1. Greece .................................................................................................................. ...... 42 
4.1.2. Spain................................................................................................................... ........ 42 
4.1.3. Portugal ................................................................................................................ ...... 44 
4.1.4. Cyprus .................................................................................................................. ...... 44 
4.1.5. Czech Republic .......................................................................................................... 45 
4.1.6. Estonia................................................................................................................. ....... 45 
4.1.7. Hungary................................................................................................................. ..... 45 
4.1.8. Latvia.................................................................................................................. ........ 45 
4.1.9. Lithuania ............................................................................................................... ..... 46 
4.1.10. Malta .................................................................................................................. ........ 46 
4.1.11. Poland................................................................................................................. ........ 47 
4.1.12. Slovakia............................................................................................................... ....... 47 
4.1.13. Slovenia............................................................................................................... ....... 48 
4.1.14. Bulgaria............................................................................................................... ....... 48 
4.1.15. Romania ................................................................................................................ ..... 48 
4.2. Audits and financial corrections................................................................................. 49 4.2.1. Greece .................................................................................................................. ...... 52 
4.2.2. Spain................................................................................................................... ........ 52 
4.2.3. Portugal ................................................................................................................ ...... 53 
4.2.4. Cyprus .................................................................................................................. ...... 54 
4.2.5. Czech Republic .......................................................................................................... 54 
4.2.6. Estonia................................................................................................................. ....... 55 
4.2.7. Hungary................................................................................................................. ..... 55 
 
EN 5   EN 4.2.8. Latvia.................................................................................................................. ........ 56 
4.2.9. Lithuania ............................................................................................................... ..... 57 
4.2.10. Malta .................................................................................................................. ........ 57 
4.2.11. Poland................................................................................................................. ........ 58 
4.2.12 Slovakia................................................................................................................ ...... 58 
4.2.13 Slovenia................................................................................................................ ...... 59 
4.2.14. Bulgaria............................................................................................................... ....... 59 
4.2.15. Romania ................................................................................................................ ..... 60 
4.3. Irregularities notified by the Member States.............................................................. 61 5. Evaluation .................................................................................................................. 62 
6. Information and publicity........................................................................................... 63 6.1. Information to/from the Member States..................................................................... 63 
6.2. Commission measures on publicity and information................................................. 63 ANNEX: Irregularities and Financial Corrections................................................................... 64 
 
EN 6   EN 1. G ENERAL CONTEXT  
1.1. Convergence and economic development in the beneficiary Member States 
1.1.1. Greece 
In 2008, GDP per capita in PPS reached 94.3% of the EU-27 average. In 2009, the 
Greek economy contracted by the higher-th an-expected ra te of 2.0%, as the positive 
contribution from net exports was more than offset by weakened domestic demand. Public finances have worsened much further than could have been expected as a consequence of the downturn and the meas ures to support the financial sector. 
Expansionary fiscal policies, until recently, contributed to aggravating the external 
imbalances and to protracted losses of competitiveness. The 2009 general government deficit stood at 13.6% of GDP, up from 7.7% in 2008. Upon notifying a 
breach of the 3% of GDP reference value for 2007, Greece entered the Excessive Deficit Procedure in April 2009. The Council issued a recommendation under Article 104(7) TEC to end this situation by 2010 at the latest. In December 2009, the 
Council concluded, in accordance with Ar ticle 126(8), that Gr eece had not taken 
effective action in response to  the April Council recommendation. 
Greece's updated stability programme, as subm itted in January 2010, sets a target of 
8.7% of GDP for its 2010 budgeta ry deficit. The aim of th e programme is to further 
reduce the deficit to 5.6% in 2011 and to 2.8% in 2012. The macroeconomic scenario 
underlying the programme anticipates a sm all contraction of GDP by 0.3% in 2010 
followed by growth of 1.5% in 2011 and 1.9% in 2012. The spring 2010 forecast made by the Commission services projects that, assuming no change in policy, the 
general government deficit will be 9.3%  of GDP in 2010 and 9.9% in 2011. The 
forecast expects real GDP to cont ract by 3.0% in 2010 and 0.5% in 2011.  
In its opinion on the stabili ty programme, dated 16 February, the Council concluded 
that the programme displays an appropriate degree of ambition given the sheer size of the consolidation need and the fact that it is frontloaded. Nonetheless, risks to the budgetary targets in the programme ha ve been identified, related to the 
macroeconomic scenario, revenue and e xpenditure projections. On 8 March, in 
compliance with the Council Decisions of  16 February, Greece submitted a report 
which described the progress in implementi ng its stability programme. The measures 
announced by the Greek government on 3 Marc h, which amounted to 2% of GDP (or 
EUR 4.8bn), consist of permanent revenue enhancing measures and permanent expenditure cuts in equal measure. On the basis of this report, the Commission assessed progress with fiscal consolida tion and issued a Communication to the 
Council on 9 March. Based on that Comm unication, the Eurogroup concluded on 15 
March that the fiscal measures announced by the Greek authorities on 3 March 2010, provided that they are implemented fully, e ffectively and in a timely manner, appear 
sufficient to safeguard the 2010 budgetary targets.  In the Statement by the Heads of 
State and Government of 25 March, the Memb er States of the euro area reaffirmed 
their willingness to take determined and co ordinated action, if needed, to safeguard 
financial stability in th e euro area as a whole. 
 
EN 7   EN 1.1.2. Spain 
Spain's GDP per capita in PPS attained 102.6% of the EU-27 average in 2008. In 
2009, GDP fell by 3.6%, reflecting both the gl obal economic downturn and a marked 
correction in the constructi on sector. The annual inflati on rate fell to 0.3% in 2009 on 
the back of lower oil and average food pr ices. The downturn took a heavy toll on 
public finances. For 2009, the general government deficit reached 11.2% of GDP, compared to 4.1% in 2008, which reflects to a large extent the imp act of the crisis on 
government finances, including the working of  automatic stabilisers. However, the 
deterioration was also caused by stimulus  measures, in line with the European 
Economic Recovery Plan (EERP), amoun ting to 2¼% of GDP. Upon notifying a 
breach of the 3% of GDP reference va lue for 2008, Spain entered the Excessive 
Deficit Procedure in April 2009. The Counc il issued recommendations under Article 
104(7) TEC to end this situ ation by 2012 at the latest. In December 2009 the Council 
concluded that Spain had taken effec tive action in response to the Council 
recommendations. The Council issued a revi sed recommendation in accordance with 
Article 126(7) TFEU to co rrect the excessive defici t by 2013, due to unexpected 
adverse economic events involving major unfavourable consequences for 
government finances. 
According to the latest upda te of the stability program me submitted in February 
2010, the targets for the general governmen t deficit are 9.8% of GDP in 2010, 7.5% 
in 2011, 5.3% of GDP in 2012  and 3% in 2013. These figures are based on the 
programme's assumptions that GDP will contract by 0.3% in 2010 and grow by 1.8% 
in 2011 and by 3% on average in 2012 a nd 2013. According to  the Commission 
services' spring 2010 forecast, the government  deficit is projected to reach 9.8% of 
GDP in 2010 and, based on an assumption of no policy change, 8.8% of GDP in 
2011. The spring forecast predicts that re al GDP will contract by 0.5% in 2010 and 
then increase by 0.8% in 2011. 
The Council, in its opinion of 26 April 2010 on the stability programme, concluded 
that the current crisis is having a severe impact on the Spanish pub lic finances, with a 
very high deficit being predicted for 2009 as  well as a rapidly-rising government debt 
ratio. It was considered that additional effo rts may be required in order to achieve the 
ambitious consolidation path, while the adjustment path is not fully supported by specific measures for the years beyond 2010.  
In view of the above assessment, and also  in the light of the Recommendation under 
Article 126(7) TFEU of 2 Decem ber 2009, Spain was invited to:  
(i) implement rigorously the ambitious fiscal plans proposed in the programme so as 
to correct the excessive deficit by 2013, back ing these up with practical measures in 
the years beyond 2010, and to be ready to a dopt further consolid ation measures in 
case the risks related to the fact that th e macroeconomic scenario of the programme 
is more favourable than the scenario  underpinning the Article 126(7) TFEU 
Recommendation actually materialise; seize, as prescribed in the EDP 
recommendation, any further opportunity in ad dition to the fiscal efforts, including 
opportunities resulting from better economic c onditions, to bring the gross debt ratio 
down at a faster rate towards 60%  of the GDP reference value;  
 
EN 8   EN (ii) in view of the projected increase in age-related expenditure and the rapid rise of 
the government debt ratio, improve the long- term sustainability of public finances 
including by implementing reforms to th e old-age pension scheme as proposed by 
the Government;  
(iii) ensure that the budgetar y framework effectively supports the achievement of the 
medium-term fiscal plans outlined at all le vels of the general government sector, and 
closely monitor adherence to the budgetary target s throughout the year;  
(iv) ensure that fiscal cons olidation measures are also ge ared towards continuing the 
improvement in the quality of public finances in the light of the need for further adjustment of existing macroeconomic imbalances. 
1.1.3. Portugal 
Portugal’s GDP per capita in PPS was 77.3% of the EU-27 average in 2008. In 2009, 
GDP contracted by 2.7% in real terms, af ter having stagnated in 2008, as a result of 
the sharp fall in investment and exports, due to the global economic crisis. The 
general government deficit came out at 9.4 % of GDP in 2009, up from 2.7% in 2008. 
This outcome to a large extent reflect s the impact of the crisis on government 
finances, but it was also caused by stimulus measures amounting to a planned 0.75% 
of GDP which the government adopted in line with the EERP and by other 
discretionary measures. By notifying a pla nned breach of the 3% of GDP reference 
value for 2009, Portugal entered the Excessi ve Deficit Procedur e in December 2009. 
The Council issued a recommendation unde r Article 126(7) TFEU  to bring this 
situation to an end by 2013 at the latest.  
The most recent update of Portugal's stab ility programme, submitted in March 2010, 
aims to achieve government deficits of  8.3% of GDP in 2010, 6.6% in 2011, 4.6% in 
2012 and 2.8% in 2013. The programme is predicated on the assumption that GDP will expand at gradually highe r rates: 0.7% in real te rms in 2010 up to 1.7% by 2013. 
The spring 2010 forecast by the Commissi on services projects the 2010 general 
government deficit at 8.5% of GDP and – if based on an assumption of no policy 
change – 7.9% in 2011. Real GDP is exp ected to grow by 0.5% in 2010 and by 0.7% 
in 2011. 
In its opinion of 26 April 2010 on the stab ility programme, the Council concluded 
that the current crisis is seriously dama ging to Portuguese public finances. Yet the 
considered view was that the current budgeta ry situation also reflects prior fiscal 
weaknesses, in particular the high stru ctural deficits prior to the crisis. 
In view of the above assessment and also in the light of the Recommendation under 
Article 126(7) TFEU of 2 Decembe r 2009, Portugal was invited to:  
(i) rigorously implement the ambitious fiscal plans for 2010 envisaged in the 
programme, and further specify the measur es to achieve the recommended average 
annual fiscal effort of 1¼% of GDP and to correct the excessi ve deficit by 2013 in 
accordance with the Article 126(7) recomm endations; be ready to adopt further 
consolidation measures in case risks materialise that the programme scenario is more favourable than the scenario underpinni ng the Article 126(7) recommendation and 
any slippage is observed; c onsider a frontloading of consolidation efforts; seize any 
 
EN 9   EN opportunity in addition to fiscal efforts, including opportunities resulting from better 
economic conditions, to speed up the reduction in the gross debt ratio to 60% of the 
GDP reference value;  
(ii) implement an effective multi-annual budgetary framework in order to ensure 
adherence to budgetary targets across the entire government sector, and to firmly 
contain and reduce expenditure  over the medium term;  
(iii) enhance the quality of public finances, in particular  by improving the efficiency 
and effectiveness of public spending in the various areas of government action; 
decisively address the situation of loss-ma king State-owned enterp rises; and factor 
into the fiscal sustainability position the spending commitments and risks arising 
from public-private partnershi ps; (iv) combine fiscal consolidation measures with 
efforts to raise productivity and potential GDP growth in a sustained way, to boost 
competitiveness and to reduce the large external imbalances. 
1.1.4. Cyprus 
In 2008, GDP per capita in PPS reached 95.9% of the EU-27 average in Cyprus. In 
2009, real GDP in Cyprus appears to have contracted by 1.7%. An  adverse external 
environment resulting from the financia l crisis and the global downturn – in 
particular, the worsening growth outlook of the key trading partners and weak 
domestic demand − weighed heavily on growth. In particular, exports of both goods 
and services declined due to lower external demand and the weak performance of tourism and shipping services. Investment picked up strongly, amidst a fall in foreign 
demand for housing, low utilisation of capacity and the restructuring of corporate balance sheets. These unfavourable economic  conditions, coupled with the fading of 
the asset boom and an expans ionary fiscal policy, partly  due to measures amounting 
to 1½% adopted within the framework of th e EERP, led to a deterioration in public 
finances. The general government balance posted a deficit of 6.1% of GDP, after a 
surplus of 0.9% in 2008.  
In the latest stability update, submitted in April 2010, the Cyprio t authorities predict 
that the general government deficit will re ach 6.0% in 2010 before falling back to 
4.5% in 2011, 3.4% in 2012 and 2.5% in 2013 respectively. The macroeconomic 
scenario underlying the programme envisages that real GDP growth will post modest growth of 0.5% in 2010, before recovering to  an average rate of about 2½% for the 
remainder of the programme period. The Commission services' spring 2010 forecast 
predicts that the deficit will rise to 7.1% in 2010 and, assuming no policy change, 
will increase further in 2011. Real GDP is expected to contract by 0.4% in 2010 and 
to grow by 1.3% in 2011. 
The overall conclusion is that Cyprus' public finances have significantly deteriorated. 
The programme outlines a consolidation path, the aim of which is to bring the general government balance to below 3% of the GDP reference value by 2013. 
However, this adjustment is due to be achieved mainly from the revenue side of the budget, while the ratio of expenditure-to-GDP  remains at historically high levels. 
Additionally, the growth assumptions underlyi ng the macroeconomic scenario of the 
programme were deemed to be favourable.  
 
EN 10   EN In view of the above assessment, Cyprus was invited to: 
(i) limit the 2010 deficit to not more  than 6% of GDP, if necessary by 
strengthening the consolid ation measures, particularly if macroeconomic 
developments prove less favourable than under the programme scenario, and take 
timely action to define a more expenditu re-driven consolida tion strategy; seize 
opportunities beyond the announced fiscal effort  to accelerate fiscal consolidation 
and reduce the gross debt ratio to below the reference value; 
(ii) implement, as planned, an effectiv e multi-annual budgetary framework in order 
to ensure adherence to the budgetary targets and to firmly  contain expenditure during 
the medium term;  
(iii) improve the long-term sustainabil ity of public finances by implementing 
reform measures to control pension and heal th care expenditure in order to curb the 
projected increase in ag e-related expenditure. 
1.1.5. Czech Republic 
Czech GDP per capita in PPS reached 80.4% of the EU-27 average in 2008. The 
Czech economy experienced a sharp recession in 2009 when GDP contracted by 4.2% in real terms. The co llapse in external demand wa s the main drag on growth. 
Annual inflation declined substantially in  2009, to 0.6% on average. This was mainly 
due to lower commodity prices, the vanish ing of the effects of earlier changes to 
indirect taxes, and the economic downtur n. The general government deficit in 2009 
is estimated to have reached 5.9% of  GDP, as compared to 2.1% in 2008. The 
significant deterioration reflects to a large extent the impact of the crisis on government finances, but it was also caused by stimulus measures  in line with the 
EERP amounting to 2.2% of GDP. By notifyi ng a planned breach of the 3% of GDP 
reference value for 2009, the Czech Republic entered the Excessive Deficit Procedure in December 2009. The Council i ssued a recommendation under Article 
126(7) TFEU to bring this situation to an end by 2013 at the latest.  
According to the most recent update of  the convergence programme, which was 
submitted in February 2010, the general government deficit in the Czech Republic is due to decline from 5.3% of GDP in 2010 to 4.8% and 4.2% of GDP in 2011 and 
2012 respectively. The macro-economic sc enario underlying the programme 
forecasts real GDP growth of 1.3% in 2010, rising gradually to 3.8% of GDP in 
2012. According to the Commission services' spring forecast, the deficit will be 5.7% 
of GDP in 2010 and is set to remain c onstant in 2011, assumi ng no changes in 
policy. Real GDP growth is estimated at 1.6% in 2011, rising to 2.4% in 2011. 
In its opinion of 26 Ap ril 2010 on the convergence programme, the Council 
concluded that the budgetary strategy of the Czech Republic for 2010 is appropriate 
and in line with the Council Recommendati on under Article 126(7)  TFEU. However, 
it was felt that the fiscal strategy for the following years lacked ambition and fiscal 
targets were thought to be risky on both the revenue and the expenditure side.  
In view of the above assessment, and also  in the light of the recommendation under 
Article 126 TFEU of 2 December 2009, as we ll as taking account of the need to 
ensure sustainable convergence, th e Czech Republic was invited to:  
 
EN 11   EN (i) implement the 2010 budget rigorously and avoid expenditure slippages; in line 
with the Council Recommendation under Articl e 126(7) in the c ontext of the 2011 
and 2012 budgets, target a larger budgetary adjustment than the one planned in the 
programme; and spell out in more detail the measures that are necessary in order to correct the excessive defi cit by 2013 at the latest;  
(ii) take action to improve budgetary procedures and to enforce and monitor more 
rigorously the medium-term budgetary targets;  in particular, avoid upward revisions 
of expenditure ceilings beyond the revisi ons permitted by the budgetary rules;  
(iii) implement the necessary reforms in orde r to improve the long-term sustainability 
of public finances. 
1.1.6. Estonia 
In 2008, Estonia's GDP per capita in PPS am ounted to 67% of the EU-27 average. 
After several years of above-potential growth, the 2008-2009 period marked an 
abrupt reversal, with the economy contrac ting by a cumulative 18%. The reversal of 
the cycle was aggravated by the severe gl obal financial crisis. With confidence 
plummeting and banks becoming increasingl y cautious in their lending decisions, 
domestic demand contracted by more th an 10% in 2008 and by 24% in 2009, while 
the downturn was exacerbated by a contracti on of external demand (-11% in 2009) . 
Inflation (HICP) declined sharply and tu rned negative in mid-2009, reflecting a rapid 
fall in world commodity prices, the fading impact of earlier administrative price 
increases, and also negative price pressu re from lower wages and subdued domestic 
consumption. Following six years of nomina l surpluses, the contraction in economic 
activity resulted in general government deficits of  2.8% and 1.7% of GDP in 2008 
and 2009 respectively.  
The January 2010 update of the convergence programme projects a general 
government deficit of 2.2% of GDP in 2010 , declining steadily to 2.0% in 2011, 
1.0% in 2012 and 0.2% in 2013. In the underl ying macroeconomic scenario, real 
GDP is expected to be flat in 2010, before  reaching an average growth rate of 3.7% 
in 2011-2013. Projections from the Commission services' spring forecast point to the 
deficit reaching 2.4% in 2010, and remaini ng steady in 2011 on the assumption of no 
policy change. Real GDP is set to grow by 0.9% in 2010 and by 3.8% in 2011. 
In its opinion of 26 Ap ril 2010 on the convergence programme, the Council 
concluded that Estonia had implemented a d ecisive consolidation of public finances 
in 2009 against the backgr ound of a significant deteri oration in the economic 
situation. It was considered, however, th at achieving budgetary outcomes is bound to 
involve downside risks in the short and medium term. 
In the light of the above assessment, and al so given the need to  ensure sustainable 
convergence and smooth participation in  ERM II, Estonia was invited :  
(i) to ensure that the general government deficit remains below 3 % of GDP and take 
the necessary measures to underpin the targ eted return to the MTO in the medium 
term;  
 
EN 12   EN (ii) to strengthen the medium-term budge tary framework, particularly by improving 
expenditure planning, and fu rther strengthen the system of monitoring and reporting 
on strategic targets. 
1.1.7. Hungary 
In 2008, Hungary's GDP per capita in PPS r eached 64.4% of the EU -27 average. In 
2009, GDP fell by 6.7%, due to the marked slowdown in domestic demand and investments, partly offset by external dema nd in view of a slight recovery in the 
global economic environment. Inflation fell to an annual average of 4.2%. The 
general government deficit is estimated to have reached 4.0% of GDP in 2009, up 
from 3.8% in 2008. Given the sizeable macroeconomic and public finance 
imbalances, the Government supported the economy by taking measures that did not 
have a significant budgetary impact. Hungar y, having been in the Excessive Deficit 
Procedure since 2004, received revised recommendations from the Council under 
Article 104(7) TEC in July 2009 due to une xpected adverse economic events with 
major unfavourable consequences for gove rnment finances. Under the revised 
recommendations, Hungary must bring the ex cessive deficit situation to an end by 
2011. 
The January 2010 update of the convergenc e programme set a general government 
deficit target of 3.8% of GDP for the year 2010, in line with the 2010 budget adopted 
on 30 November 2009. For 2011 the projected defi cit is 2.8%, with a further fall to 
2.5% in prospect in 2012. The macroeconomic  scenario forecasts a contraction of 
0.3% in real GDP in 2010, followed by growth of 3.7% and 3.8% in 2011 and 2012 respectively.  
In its opinion of 26 April 2010 on th e convergence programme the Council 
concluded that, despite the sharp economic contraction in 2009 as a result of the 
financial crisis, the budget deficit had st abilised. However, it was noted that the 
budgetary path provides the prospect of onl y a small structural improvement in 2010, 
none in 2011, and a deterioration in 2012. Moreove r, this path was considered to be 
subject to considerable  downside risks.  
In view of the above asse ssment and also in the light  of the recommendation under 
Article 104(7) TCE on 7 July 2009, Hungary was invited to:  
(i) ensure that the 3.8% of  GDP deficit target for 2010 is achieved through tight 
expenditure control as well as through a possible freezing of budgetary reserves and 
the implementation of contingency expenditure cuts, if needed;  
(ii) specify the measures underlying th e budgetary targets from 2011 onwards and 
stand ready to strengthen the fiscal effort in case the risks due to the fact that the 
programme scenario is more favourable  than the scenario underpinning the 
Article 104(7) TEC Recommendation actually mate rialise, in order to  ensure that the 
deficit is brought below 3% of GDP in 2011; and considerably strengthen the 
strategy for 2012 to ensure an adjustment  towards the MTO in line with the 
requirements of the Stability and Growth Pact;  
(iii) improve the quality of public finances by preparing and adopting a 2011 budget 
in full compliance with the fiscal fr amework and by supporting expenditure 
 
EN 13   EN moderation through a further reform of public  administration and by addressing the 
situation of loss-making enterpri ses through structural reforms. 
1.1.8. Latvia 
In 2008, Latvia's GDP per capita in PPS was 56% of the EU-27 average. The global 
financial crisis amplified the shock of the reversal in Latvia's domestic lending and 
house price boom by tightening credit availability and terms. The concomitant 
downturn in external markets hit the tradeables sector. Despite the adoption of a restrictive supplementary budget on 16 June 2009 in consultation with international 
lenders, which involved a consolidati on effort of 4.4% of GDP, the general 
government deficit rose to 9.0% of  GDP in 2009, up from 4.1% in 2008. By 
notifying a breach of the 3% of GDP refe rence value for 2008, Latvia entered the 
Excessive Deficit Procedure in July 2009. The Council issued a recommendation 
under Article 104(7) TEC to end this  situation by 2012 at the latest. 
The January 2010 update of the converg ence programme projects the general 
government deficit at 10.0% of GDP in 2010, followed by a decline to 8.5% in 2011, 
6.0% in 2012 and 2.9% in 2013.  According to the progra mme, and in line with 
commitments made in the framework of international financial assistance, fiscal 
policy is set to remain severely restri ctive throughout the programme period, given 
the absence of fiscal room for manoe uvre and the need to correct economic 
imbalances. The underlying macroeconomic scenario envisages that, after the exceptionally severe fall in output , which is estimated at 18% in 2009, real GDP will 
fall by a further 4.0% in 2010 before rising by 2.0% in 2011, and by 3.8% in 2012. 
The expected transition back to positive grow th is led by the external sector and to a 
lesser extent by fixed investment, with private consumption and overall domestic 
demand not registering significant expansi on until relatively late in the programme 
period. The spring 2010 forecast by the Commission services projects the 2010 deficit at 8.6%, climbing to 9.9% in 2011, assuming no policy change. The economic forecast estimates a contraction of 3.5% in  real GDP in 2010, followed by growth of 
3.3% in 2011.  
In its opinion of 26 Ap ril 2010 on the convergence programme, the Council 
concluded that Latvia is undertaking a si gnificant fiscal consolidation and economic 
adjustment in line with the Council's  recommendations. Looking forward, it was 
considered that the risks concern the size of the remaining adjustment in the context 
of a sluggish economy, uncertainty over futu re revenue trends and which measures 
should be taken to underpin the consolidation.  
In view of the above assessment and in  the light of the recommendation under 
Article 104(7) TEC, and also given the need  to ensure sustainable convergence and a 
smooth participation in ERM II, Latvia was invited to:  
(i) fully implement the 2010 budget as adopted on 1 December 2009; prepare a menu 
of budgetary options to generate savings  or additional revenues allowing the 2011 
budget to be adopted in accordance with the consolidation needs; adopt a 2012 budget that is also consistent with the targ eted fiscal path, in  line with the Council 
Recommendation under Article 104(7);  
 
EN 14   EN (ii) carry out the thorough and forward-l ooking analysis needed  for a wide-ranging 
reform of social benefits, with a view to implementing such a reform in the course of 
2011, together with further measures on the revenue side;  
(iii) improve fiscal governance and transpar ency, inter alia by adopting the draft law 
on fiscal discipline, by strengthening the binding nature of the medium-term 
budgetary framework, and by putting in place  effective sanction procedures for 
misuses of public funds by individuals; stre ngthen control, coor dination and sanction 
mechanisms aimed at tackling the grey economy;  
(iv) foster economic growth by promoting th e shift towards the tradeable sector and 
productivity improvements, including by ensu ring that the available EU Structural 
Funds reach the real economy, and by rest ructuring state-owned banks in a timely 
manner, as part of a medium-term strategy. 
1.1.9. Lithuania 
In 2008, Lithuania's GDP per capita in PPS reached 62% of the EU-27 average. 
Several years of rapid economic convergen ce in Lithuania gave way to a deep 
economic recession in 2009, when output fe ll by 15%. The downturn reflects tight 
credit conditions, adjustment in the real es tate market and sharp falls in confidence 
among businesses and consumers, exacerbated by the substantial deterioration in the 
external environment. Owing to the wo rsening macroeconomic situation and 
financing constraints, public  finances have come under si gnificant strain. The general 
government deficit grew to 3.2% of GDP in 2008 and rose further to 8.9% of GDP in 
2009, despite significant fiscal consolid ation measures in 2009. By notifying a 
breach of the 3% of GDP reference value for 2008, Lithuania entered the Excessive 
Deficit Procedure in July 2009. The Counc il issued a recommendation under Article 
104(7) TEC to end this situ ation by 2012 at the latest. 
According to the February 2010 update of  the convergence programme, the general 
government deficit is due to reach 8.1%  of GDP in 2010, 5.8% in 2011 and 3.0% in 
2012. In the underlying macroeconomic scenario  real GDP is predicted to increase 
by 1.6% in 2010, accelerating to 3.2% in 2011, but slowing back to 1.2% in 2012. 
According to the Commission services' sp ring 2010 forecast, the deficit should be 
8.4% in 2010 and 8.5% in 2011, under th e customary assumption of no policy 
change. Real GDP is set to decline by 0.6% in 2010 and to rise by 3.2% in 2011. 
In its opinion of 26 Ap ril 2010 on the convergence programme, the Council 
concluded that Lithuania had implemente d a decisive consolidation of public 
finances in 2009 in the context of a si gnificant deterioration in the economic 
situation. The Council took the view, howev er, that budgetary outcomes are subject 
to downside risks over the whole programme period.  
In view of the above asse ssment and also in the light  of the recommendation under 
Article 126 TFEU of 16 February 2010, and given the need to ensure sustainable 
convergence and a smooth participation in  ERM II, Lithuania is invited to: 
(i) consider additional corrective measures in 2010 if these are necessary in order 
to achieve the envisaged consolidation, in addition to implementing rigorously the measures planned in the budget; 
 
EN 15   EN (ii) specify the necessary measures to fully underpin the required adjustment over 
the programme period recommended by th e Council under Article  126(7), and stand 
ready to adopt further consolidation measures in case risks related to the fact that the 
macroeconomic scenario of the programme is more favourable than the scenario 
underpinning the Article 126(7) Recommendation materialise; 
(iii) implement planned social security system reforms, including pension reform, 
so as to reduce the high risks to long-term  sustainability of public finances due to 
significant projected increases in pensi on expenditure during the coming decades; 
(iv) strengthen fiscal gov ernance and transparency by enhancing the medium-term 
budgetary framework and improving reporting of budgetary data, thus ensuring comparability of the budgetary indicato rs on a cash and accrual basis. 
1.1.10. Malta 
In 2008, Malta's GDP per capita in PPS was 76% of the EU-27 average. Real GDP 
declined by 1.9% in 2009 after growing by 2.1% in 2008. The global crisis affected 
Malta primarily through the trade channel,  even though the drop in foreign sales in 
2009 was less pronounced than the contractio n in world trade. Within domestic 
demand, investment contracted sharply, while private consumption remained 
relatively stable on the back of resilient employment numbers, lower inflation and 
some recovery measures in line with the EERP. The impact of the downturn led to a 
significant widening of the general governme nt deficit to 4.7% of GDP in 2008 and 
to 3.8% in 2009. Upon notifying a breach of  the 3% of GDP reference value for 
2008, Malta entered the Excessive Defic it Procedure in July 2009. The Council 
issued a recommendation unde r Article 104(7) TEC to end this situation by 2010 at 
the latest. 
According to the most recent update of  the stability programme submitted in 
February 2010, the general government defic it is due to broadly stabilise in 2010 at 
3.9% of GDP, before declining to 2.9% in 2011 and to 2.8% in 2012. The 
macroeconomic outlook for 2010 projects real GDP growth at 1.1%, before accelerating to 2.3% in 2011 and 2.9% in 2012. The spring 2010 forecast made by the Commission services projects the general government deficit to  be 4.3% in 2010 
and 3.6% in 2011, assuming no policy change. Real GDP is expected to grow by 
1.1% in 2010 and 1.7% in 2011. 
In its opinion of 26 April 2010 on the stab ility programme, the Council concluded 
that, according to the programme, the gene ral government deficit ratio is due to 
broadly stabilise in 2010 (at 3.9% of GDP), followed by a return to just below the 3% of the GDP reference value in 2011, wh ich is the deadline set by the Council for 
the correction of the excessive deficit. It was considered, however,  that both debt and 
deficit are subject to downward risks, which will need to be addressed as a matter of importance.  
In view of the above asse ssment and also in the light  of the recommendation under 
Article 126(7) TFEU of 16 Februa ry 2010, Malta was called upon to:  
(i) achieve the 2010 deficit target of 3.9%  of GDP, if necessary by adopting 
additional consolidation measures; back up th e strategy to bring the deficit below 3% 
 
EN 16   EN of GDP in 2011 with concrete measures, while standing ready to adopt further 
consolidation measures in case risks rela ted to the fact that the macroeconomic 
scenario of the programme is more favour able than the scen ario underpinning the 
Article 126(7) Recommendation actually mate rialise; and consid erably strengthen 
the strategy for 2012 to ensure an adjust ment towards the MTO in line with the 
requirements of the Stability and Growth Pact; seize, as set out in the EDP recommendation, any opportunity beyond th e fiscal efforts, including better 
economic conditions, to accelerate the reductio n of the gross debt ratio towards 60% 
of GDP reference value;  
(ii) in view of the significant projected in crease in age-related expenditure, improve 
the long-term sustainability  of public finances by implementing further reforms of 
the social security system;  
(iii) strengthen the binding nature of  the medium-term budgetary framework and 
improve the monitoring of budget implement ation throughout the year, and enhance 
the efficiency of public spending, es pecially in the area of health. 
1.1.11. Poland 
In 2008, Poland’s GDP per capita in PPS was 56% of the EU-27 average. The global 
economic and financial crisis affected Poland through three main channels: lower 
demand for exports, lower foreign direct i nvestment, and a halt in credit growth. 
Nevertheless, with real GDP estimated to  have increased by  1.8%, Poland was the 
only EU country to record positive growth in 2009. This resistance  is explained by 
sound fundamentals at the outset of the crisis , a well capitalised and healthy financial 
sector, the relatively low level of openne ss of the economy, a sizeable depreciation of 
the Polish currency at an early stage of the crisis, the cushioning effect of the 
adjustment of real wages on employment, and timely reactions from monetary and fiscal policies. The general government de ficit rose to 7.1% of GDP in 2009 from 
3.7% of GDP in 2008. The main reason for th is - besides slower  growth - is the 
implementation of stimulus measures in line with the EERP amounting to about 2% of GDP. By notifying a breach of the 3% of GDP reference value for 2008, Poland 
entered the Excessive Deficit Procedur e in July 2009. Th e Council issued a 
recommendation under Article 104(7) TEC to end this situation by 2012 at the latest. 
According to the most recent update of the convergence programme, the general 
government deficit will reach 6.9% of GD P in 2010, before shrinking to 5.9% in 
2011 and 2.9% in 2012. The scenario is based on the assumption of real GDP growth of 3.0% in 2010, 4.5% in 2011 and 4.2% in 2012. The Commission services' spring 
2010 forecast projects that the budget de ficit will reach 7.3% in 2010, before 
declining slightly to 7.0%  in 2011. The macroeconomic forecast puts real GDP 
growth at 2.7% in 2010 and 3.3% in 2011. 
In its opinion of 26 April 2010 on th e convergence programme the Council 
concluded that, although Pola nd is planning to correct its  excessive deficit by 2012 in 
line with the Council recommendation under the excessive deficit procedure, the fiscal adjustment was considerably backlo aded and deficit targets in the programme 
were subject to significant downside ri sks, on both the revenue and expenditure 
sides.  
 
EN 17   EN In view of the above asse ssment and also in the light  of the recommendation under 
Article 104(7) TEC of 7 July 2009, plus the need to ensure sustainable convergence, 
Poland was invited to:  
(i) implement the 2010 budget rigorous ly, under-executing primary current 
expenditure plans wherever possible and allocating windfall revenue to deficit 
reduction;  
(ii) strengthen the budgetary adjustment planned in 2011 in order to achieve the 
recommended average annual fiscal effort of 1¼% of GDP in lin e with the Article 
104 (7) Recommendation and stand ready to ad opt further consolidation measures in 
2011 and 2012 in case the risks related to th e fact that the programme scenario is 
more favourable than the scenario unde rpinning the recommendation under Article 
104(7) TEC actually materialise;  
(iii) proceed with strength ening the fiscal framework, including by introducing an 
expenditure rule covering a larger share of the general government primary expenditure than the "tem porary" rule presented in  the Convergence Programme, 
with appropriate monitoring and enforcem ent mechanisms. This would require the 
share of statutory spending in to tal expenditures to be reduced. 
1.1.12. Slovakia 
In 2008, Slovakia's GDP per capita in PPS reached 72.2% of the EU-27 average 
when the economy recorded growth of 6.2%. In 2009, real GDP fell by 4.7% mainly 
due to a steep fall in external demand and a consequent collapse of industrial 
production. Tamed by the downturn, annual inflation averaged 0.9% in 2009. To 
contain the effects of the crisis, the authorities allowed the full operation of automatic stabilisers and, in line with the EERP, adopted anti-crisis measures 
amounting to ½% of GDP for both 2009 a nd 2010 (financed through reallocations 
within the budget). In 2 009, the government deficit amounted to 6.8% of GDP, up 
from 2.3% in 2008. Due the risk of breachi ng the 3% of GDP reference value for 
2009, Slovakia entered the Excessive De ficit Procedure in December 2009. The 
Council issued a recommendation under Article 126(7) TFEU to end this situation by 
2013 at the latest. 
Slovakia's stability programme predicts a fall in the headline deficit from 5.5% of 
GDP in 2010 to 4.2% and 3.0% of GDP in 2011 and 2012, respectively. The underlying macroeconomic scenario projects a gradual recovery with real GDP growth reaching 1.9% in  2010, 4.1% in 2011 and 5.4% in 2012. The Commission 
services' spring 2010 forecast estimates that the 2010 deficit will be as high as 6.0%, declining somewhat to 5.4% in 2011 on th e assumption of no policy change. Real 
GDP growth is likely to be  2.7% in 2010 and 3.6% in 2011. 
In its opinion of 26 April 2010 on the stab ility programme, the Council concluded 
that the fiscal strategy presented in th e programme was broadly in line with the 
Council recommendation under the excessive  deficit procedure. However, the 
budgetary projections were considered to be  subject to risks, owing to favourable 
growth assumptions for the coming years, and might require more specific measures 
in order to achieve the planned savings on the expenditure side.  
 
EN 18   EN In view of the above asse ssment and also in the light  of the recommendation under 
Article 126 TFEU of 2 December 2009, Slovakia was invited to:  
(i) implement the deficit reducing measur es in 2010 as planne d in the budget, and 
support the consolidation path for the follo wing years with specific measures to 
secure the correction of the excessive defici t, if possible by 2012, a nd at the latest by 
2013;  
(ii) continue reforms of the pension system with a view to ensuring the sustainability 
of government finances;  
(iii) implement the measures envisaged to fu rther strengthen the fiscal framework, in 
particular the introduction of enforceable multiannual expenditure ceilings. 
1.1.13. Slovenia 
In 2008, Slovenia's GDP per capita in PPS r eached 90.9% of the EU-27 average. The 
rapid expansion came to an end in the f ourth quarter of 2008 when the Slovenian 
economy – owing to its high degree of openness - was hit hard and rather abruptly by 
the global crisis, chiefly through the trade channel. After an e xpansion of 3.5% in 
2008, real GDP contracted by 7.8 % in 2009. The economic slowdown after a phase of growing risks of overheating and fa lling competitiveness is prompting some 
adjustment of the economy: since the end of 2008, the infl ation differential with the 
euro area and the external deficit have both gradually decreased, with the latter 
approaching balance in 2009. The general government balance was 5.5% of GDP in 
2009, up from 1.7% in 2008, due to the working of the automatic stabilisers and measures to respond to the crisis am ounting to some 1½% of GDP, which the 
government adopted in line with the EERP.  Upon notifying a plan ned breach of the 
3% of GDP reference value for 2009, Sl ovenia entered the Excessive Deficit 
Procedure in December 2009. The Council issued a recommendation under Article 126(7) TFEU to end this situation by 2013 at the latest. 
According to the January 2010 update of  the stability programme, the general 
government deficit ratio is due to stabilise at 5.7% of GDP in 2010 and to gradually decline thereafte r to 4.2% in 2011, 3.1% in 2012 and 1.6% in 2013. According to the 
macroeconomic scenario underlying the pr ogramme, the rise in real GDP will be 
0.9% in 2010 and 2.5% in 2011, accelerating to 3.7% in 2012 and 3.5% in 2013. Taking only fully specified measures into account − as is customary − the spring 
2010 forecast of the Commission services pr ojects a deficit of 6.1% of GDP in 2010. 
Thereafter, it expects the de ficit in 2011, on a no-policy-ch ange basis, to  fall to 5.2% 
of GDP. Real GDP is projected to grow by 1.1% in 2010 and by 1.8% in 2011.  
In its opinion of 26 April 2010 on the stab ility programme, the Council concluded 
that under the programme the general government  deficit ratio is due to stabilise at 
5.7% of GDP in 2010 and to gradually declin e thereafter to well below 3% of GDP 
in 2013, which is the deadline for the correcti on of the excessive deficit as set by the 
Council. The Council further concluded that the budgetary strategy is subject to downside risks, as economic growth might  be lower than projected and as the 
measures to support the proposed  of consolidation of expend iture have yet to be fully 
spelled out and adopted. 
 
EN 19   EN In view of the above assessment, and also  in the light of the recommendation under 
Article 126(7) TFEU of 2 Decembe r 2009, Slovenia was invited to:  
(i) rigorously implement the planned cons olidation measures in 2010 and bring the 
deficit below the 3% of GDP refere nce value by 2013, as planned, by fully 
specifying, adopting and implementing the indi cated measures to contain expenditure 
in line with the average annual fiscal e ffort recommended by th e Council in Article 
126(7), while standing ready to adopt further consolidation measures in the event that 
risks related to the fact that the macroec onomic scenario of the programme is more 
favourable than the scenario underpinni ng the Article 126(7) Recommendation 
actually materialise;  
(ii) pursue efforts to enhance expenditure control and the enforceable nature of the 
multi-annual budgetary plans, and improve public spending efficiency and effectiveness;  
(iii) in view of the significant projected in crease in age-related expenditure, carry out 
further reform of the pension system and set a more ambitious MTO that takes sufficient account of the implic it liabilities rela ted to ageing. 
1.1.14. Bulgaria 
In 2008, Bulgaria's GDP per capita in PPS reached 41.3% of the EU-27 average. The 
unfolding global economic crisis hit the Bu lgarian economy hard, mainly through the 
trade and investment channe ls, and economic growth figures moved into negative 
territory in 2009. Thus, real GDP contract ed by 5% in 2009, against an average 
growth of above 6% in th e period 2003-08. At the same time the financial crisis 
reinforced the need for adjustment. Some  of the large macro-economic imbalances 
that had accumulated during the boom y ears started to unwind. Average HICP 
inflation decelerated sharply to 2.5% in  2009, down from its p eak of 12% in 2008. 
The current account deficit also corrected rapidly, falling from 24% of GDP at the 
end of 2008 to 9.6% of GDP in 2009. The cris is led to a severe  deterioration in 
public finances. The general government ba lance swung from a surplus of 1.8% of 
GDP in 2008 to a deficit of 3.9% of GDP in 2009. Reliance on public finances to 
cushion the negative impact of the crisis was restricted by the need to maintain a sound budgetary position in order to underpin macroeconomic stability. 
The most recent update of Bulgaria's convergence programme, submitted in January 
2010, targets a balanced budget for genera l government throughout the programme 
period 2010-2012. The macroeconomic scenar io underlying the programme projects 
that real GDP will improve to 0.3% in 2010 be fore recovering to an average rate of 
4¼% over the remainder of the programme  period. In the Co mmission services' 
spring 2010 forecast the general government de ficit is projected at 2¾% of GDP in 
2010 and, assuming a no policy change, at 2¼% of GDP in 2011. Real GDP growth 
is expected to stagnate at 0% in  2010 before picking up to 2.7% in 2011. 
In its opinion of 26 Ap ril 2010 on the convergence programme, the Council 
concluded that the programme's aim to maintain a sound budgetary position, reflected in planned bala nced budgets of general government, was considered 
adequate at the present economic juncture and in view of the need to contain the 
economy's external imbalances. However, it was felt that the pl anned consolidation 
 
EN 20   EN in 2010 was not fully underpinned by the measures outlined in the programme. In 
addition, the full implementation of this programme depends on an optimistic macroeconomic scenario, with further risks resulting from the upward revision of the 
2009 deficit. For the period 2011 and beyond , the lack of specific information 
concerning the measures in the programme could further undermine the planned adjustment path. 
In view of the above assessment and given the need to ensure sustainable 
convergence, Bulgaria was invited to: 
(i) continue implementing strict fiscal policies and adopt further consolidation 
measures to achieve the programme target for 2010 with a view to sustaining the on-
going adjustment in the external imbalances  and safeguarding inve stor confidence in 
the economy; in particular, contain public sect or wage growth in order to contribute 
to overall wage moderation and improve competitiveness; 
(ii) strengthen the efficiency of public  spending by vigorously implementing the 
planned structural reforms in the area of public administration, h ealthcare, education, 
and pensions, in order to boost productivity  and ensure sustainable convergence 
within the European Union. 
1.1.15. Romania  
Romania's GDP per capita in PPS stood at 48% of the EU-27 av erage in 2008. After 
expanding by 7.3% in 2008, the Romanian ec onomy contracted by 7.1% in real 
terms in 2009 as domestic demand fell sh arply. The stronger decline in imports 
compared to exports resulted in a less pronounced external imbalance, with the 
current account deficit estim ated to have decreased to  4.2% of GDP in 2009 from 
12.7% in 2008. The government deficit, which was 5.4% in 2008, reached 8.3% of GDP in 2009. By notifying a breach of th e 3% of GDP reference value for 2009, 
Romania entered the Excessive Deficit Proc edure in July 2009. The Council issued a 
recommendation under Article 104(7) TEC to e nd this situation by 2011 at the latest.  
The latest update of Romania's converg ence programme, subm itted in March 2010, 
sets a target of a government deficit of  6.3% of GDP in 2010, followed by further 
reductions to 4.4% in 2011 and 3% in 2012  respectively. The ach ievement of these 
targets depends on a positive economic grow th scenario of 1.3% in 2010, 2.4% in 
2011, and 3.7% in 2012. The Commission serv ices' forecast for spring 2010 projects 
a worse general government deficit of 8%  of GDP in 2010 and of 7.4% in 2011. The 
forecast predicts that real GDP growth will increase by 0.8% in 2010 and by 3.5% in 
2011. 
In its opinion of 26 April 2010 on the c onvergence programme the Council stated 
that, in view of worse-than-expected deve lopments, the macro-economic scenario for 
2010 appeared to be slightly optimistic, but plausible, for 2011-2012. As for public 
finances, the Council concluded that th e consolidation path  projected in the 
convergence programme is appropriate, but full implementation of the consolidation 
measures planned for 2010 is essential if th e deficit target is to be reached. In 
addition, the programme does not go suffi ciently into the specifics of the 
consolidation measures to be taken in 2011 and 2012. The implementation of the 
fiscal governance reforms decided upon within the context of the EU balance of 
 
EN 21   EN payments assistance programme in Romani a should help in achieving the budgetary 
targets for 2011 and 2012. 
In view of the above assessment, in the light of the recommendation of 16 February 
2010 under Article 126(7) TFEU and given the need to ensure sustainable convergence, Romania was invited to: 
(i) rigorously implement the fiscal consolid ation measures for 2010 agreed as part of 
the balance-of-payments support programme and take further corrective action, if 
needed, to achieve the 2010 target for the general government deficit. The Romanian 
authorities are also invited to specify, in  the context of the Medium-Term Budgetary 
Framework to be prepared by end May 2010, th e fiscal consolidation measures that 
are necessary in order to achieve the pr ogramme budgetary targ ets in 2011 and 2012; 
(ii) improve the fiscal framework by adopting and implementing the fiscal 
responsibility law. In particular, take into  account the analysis by the Fiscal Council 
of the design and conduct of fiscal policy; 
(iii) adopt and implement the draft pension la w, which is intended to contribute to a 
significant improvement in the long-term  sustainability of public finances. 
1.2. Conditionality 
Article 6 of Council Regulation (EC) No  1164/94, which governs the Cohesion Fund 
for projects approved prior to the end of 2006, attaches budgetary policy conditions to disbursements by the Fund. It provides th at "no new projects or, in the event of 
important projects, no new project stages sh all be financed by the Fund in a Member 
State in the event of the Council, acti ng by a qualified majority on a recommendation 
from the Commission, finding that the Member  State […] has not implemented [its 
stability or convergence programme] in such a way as to avoid an excessive deficit". 
At the end of 2009, eleven Member States that were eligible for support under the 
Cohesion Fund (Greece, Spain, Portugal, Czech Republic, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Sl ovenia) were in the excessive deficit 
procedure (EDP), which, according to the aforementioned Regulation, may under certain conditions be associat ed with the suspension of transfers from the Fund. In 
2009 there were three cases (Greece, Sp ain and Hungary) wher e effective action 
taken in compliance with the Council recommendations  under Article 104(7) TEC 
was assessed. The Council decided that Spain and Hungary had taken effective action and it issued new recommendations under  Article 126(7). Only in the case of 
Greece did the Council decide under Article 126( 8) TFEU that the authorities had not 
taken effective action in response to the Council recommendations to end the 
excessive deficit, although suspension of payments from the Cohesion Fund was not 
recommended at the time. 
 
EN 22   EN 2. F INANCIAL IMPLEMENTATION OF THE 2000-2006  PERIOD IN 2008  AND CLOSURE OF 
PROJECTS  
2.1. Payments made in 2009 for projec ts adopted during the 2000-2006 period 
The report concerns a total of sixteen Member States who are benefitting from 
Cohesion Fund interventions in the peri od 2000-2006 (Ireland has no longer been 
eligible since 1 January 2004 and Bulgaria  and Romania became eligible from 
1 January 2007).  
The Member States can be divided into th ree groups: a group of four Member States 
already eligible from the beginning of  the programming period 2000-2006, a second 
group of ten Member States that joined the European Union in May 2004, and the 
group of two Member States (Romania a nd Bulgaria) who joined the European 
Union in 2007. The tables present the in formation by individual Member State and 
by group. 
Given that all commitments for the C ohesion Fund projects financed under the 
2000-2006 programming period were executed by 31 December 2006, the financial resources available for the Cohesion F und in 2009 were confined to payment 
appropriations only.  
The 2009 initial budget for the 2000-2006 C ohesion Fund projects amounted to 
EUR 3,892 million. However, the final budget was reduced to EUR 2,777 million. The cut is justified by significantly bette r implementation in 2008, where payments 
exceeded the voted budget by nearly 30 %. In order to bridge the gap between the available resources and the demand for payments, transfers have been made from the budget line related to the 2007-2013 Cohesion Fund progra mmes. This was due to a 
slower start-up of the 2007-2013 period, and thus in 2008 the Member States opted 
to counterbalance the delay by focusi ng on the implementation of the 2000-2006 
projects. In 2009 the trend was revers ed and the outstanding 2000-2006 payment 
appropriations were transferred to  the 2007-2013 Cohesion Fund and ERDF 
programmes, which provided for 100 % execu tion of payment appropriations for the 
Cohesion Fund programmes and projects fi nanced under both programming periods. 
The available appropriations of EUR 2,777 million were fully implemented by the end of 2009, resulting in additional payments of nearly EUR 300 million made in 2009 when compared with 2008 (EUR 2,489 million).  
As far as the former ISPA budget lines are concerned, the budget voted in 2009 
amounted to EUR 400 million. In September ( during the Global Transfer procedure), 
additional appropriations of an amount of EUR 125 million were added to the relevant budget lines. After further reinforcements in December 2009, the final appropriations amounted to some EUR 529 million (an amount comparable to the 
implementation in 2008, namely EUR 531 million). The available appropriations were implemented in their entirety.  
As at the end of 2009, the average absorption rate (payments vs. commitments) of all 
current beneficiary countries for both the Cohesion Fund and former ISPA projects, 
was 75.8 % (Table 3). Bulgaria's low absorption rate at the end of 2008 (39.8 %) improved significantly in the course of 2009, resulting in a rate of 56.5 %. The other 
absorption rates range from 65.8 % (Pola nd and Romania) to 92.8 % (Ireland). 
 
EN 23   EN Table 1 presents the overall execution of  payments in 2009 (including technical 
assistance) for the Cohesion Fund and the former ISPA projects. 
Table 1. Implementation of the Cohesion Fund and former ISPA payments in 2009 
(Euro) 
Payment 
Appropriations Initial Movements Final 
Resources Outturn Carryovers 
2010 
Cohesion Fund 3.892.453.278 -1.115.315.452 2.777.137.826 2.777.137.825 -
Ex-ISPA 400.000.000 +128.969.059 528.969.059 528.969.059 -
TOTAL 4.292.453.278 -986.346.395 3.306.106.885 3.306.106.885 -
Table 2 shows the level of 2009 payments for each Member State. The main 
beneficiary countries are Spain in the EU 4 group, Poland in  the EU 10 group and 
Romania in the EU 2 group.  
In 2009, payments were signifi cantly higher in comparison to the payments made in 
2008 for the following countries: Hungary (+ EUR 169 million or 312 % of payments made in 2008), Bulgaria (+ EU R 92 million or 272 % of 2008 payments), 
Portugal (+ EUR 119 million or 161 % of 2008 payments) and Greece (+ EUR 68 million or 134 % of 2008 payments). On the other hand, lower payments compared to the 2008 execution were no tified, in particular, for Slovakia 
(- EUR 98 million or 30 % of payments made in 2008) and Latvia (- EUR 58 million 
or 42 % of 2008 payments).  
Table 2. Payments made in 2009 to the Cohesion Fund and former ISPA projects per 
Member State (including technical assistance) 
Environment Transport Technical 
Assistance TOTAL Member 
State 
Amount % 
(as 
compared 
to the CF 
2009 
outturn 
by MS) Amount % 
(as 
compared 
to the CF 
2009 
outturn by 
MS) Amount Amount % 
(as 
compared 
to the 
global CF 
amount) 
Greece  87.787.992 32,8% 179. 354.927 67,0% 483.890 267.626.809 8,1% 
Portugal  217.958.948 69,4% 95.310.572 30,4% 662.867 313.932.387 9,5% 
Ireland  10.700.000 46,7% 12.231.279 53,3% -  22.931.279 0,7% 
Spain  438.942.360 61,6% 273. 080.132 38,4% -  712.022.492 21,5% 
EU 4 755.389.300 57,4% 559.976.910 42,5% 1.146.757 1.316.512.967 39,8% 
Cyprus  8.236.548 100,0% -  -  -  8.236.548 0,2% 
Czech 
Republic  110.536.127 61,8% 68.256.254 38,2% -  178.792.381 5,4% 
 
EN 24   EN Environment Transport Technical 
Assistance TOTAL Member 
State 
Amount % 
(as 
compared 
to the CF 
2009 
outturn 
by MS) Amount % 
(as 
compared 
to the CF 
2009 
outturn by 
MS) Amount Amount % 
(as 
compared 
to the 
global CF 
amount) 
Estonia  26.598.027 63,9% 11. 887.556 28,6% 3.131.117 41.616.700 1,3% 
Hungary  101.174.649 40,8% 145. 002.371 58,5% 1.843.895 248.020.915 7,5% 
Latvia  23.221.184 55,6% 18.360.386 43,9% 205.401 41.786.971 1,3% 
Lithuania  54.895.917 54,1% 43.992.426 43,4% 2.548.928 101.437.271 3,1% 
Malta  -  -  -  -  2.909 2.909 0,0% 
Poland  473.658.296 56,6% 351. 643.624 42,0% 11.512.473 836.814.393 25,3% 
Slovakia  46.574.012 99,5%  -  -  244.253 46.818.265 1,4% 
Slovenia  20.483.408 51,4% 19.354.671 48,6% -  39.838.079 1,2% 
EU 10 865.378.168 56,1% 658.497.288 42,7% 19.488.976 1.543.364.432 46,7% 
Bulgaria  67.755.746 46,6% 69.324.323 47,7% 8.384.684 145.464.754 4,4% 
Romania  198.052.988 65,8% 95. 213.178 31,7% 7.498.566 300.764.732 9,1% 
EU 2 265.808.734 59,6% 164.537.501 36,9% 15.883.250 446.229.486 13,5% 
TOTAL 1.886.576.202 57,1% 1.383.011.699 41,8% 36.518.983 3.306.106.885 100,0% 
2.2. Outstanding commitments from the 2000-2006 period 
At the end of 2009, the outstanding commitments (RAL) corresponding to the 
2000-2006 period amounted to EUR 8.4 billion  
During 2009, the outstanding RAL was redu ced by EUR 3.3 billion. In terms of 
absorption, the most significant decreases  in RAL were notified for Hungary 
(- 16.8 percentage points), Bulgaria (- 16.7 percentage points), Slovenia 
(- 15.7 percentage points), Poland and Roma nia (both – 14.9 percentage points).  
 
EN 25   EN Table 3. Cohesion Fund and former ISPA accepted amounts in 2000-2006 (including 
RAL) 
Member 
State Committed 
(until 12/2009) Paid  
(until 12/2009) % 
Paid RAL  
as at 
31/12/2009 % RAL 
Greece 3.565.195.978 2.715.334.857 76,2% 849.861.122 23,8% 
Spain 12.915.179.288 10.519.496.170 81,5% 2.395.683.119 18,5% 
Ireland 625.755.407 580.710.223 92,8% 45.045.184 7,2% 
Portugal 3.497.201.489 2.741.059.557 78,4% 756.141.931 21,6% 
TOTAL 
EU-4 20.603.332.162 16.556.600.807 80,4% 4.046.731.356 19,6% 
Cyprus 54.014.695 40.029.810 74,1% 13.984.885 25,9% 
Czech 
Republic 1.226.581.086 975.579.344 79,5% 251.001.742 20,5% 
Estonia 425.431.731 330.768.303 77,7% 94.663.429 22,3% 
Hungary 1.481.998.333 1.028.122.934 69,4% 453.875.399 30,6% 
Latvia 713.987.456 541.309.058 75,8% 172.553.278 24,2% 
Lithuania 825.354.775 661.411.795 80,1% 163.942.980 19,9% 
Malta 21.966.289 17.532.611 79,8% 4.433.678 20,2% 
Poland 5.634.539.614 3.708.555.930 65,8% 1.925.983.684 34,2% 
Slovakia 766.117.246 586.031.109 76,5% 180.086.137 23,5% 
Slovenia 254.197.825 202.417.662 79,6% 51.780.164 20,4% 
TOTAL 
EU-10 11.404.063.930 8.091.758.556 71,0% 3.312.305.376 29,0% 
Bulgaria 876.947.183 495.486.300 56,5% 381.460.884 43,5% 
Romania 2.037.250.711 1.340.892.809 65,8% 696.357.902 34,2% 
TOTAL 
EU 2 2.914.197.894 1.836.379.109 63,0% 1.077.818.786 37,0% 
TOTAL 34.921.593.986 26.484.738.472 75,8% 8.436.855.518 24,2% 
2.3. Closure of projects from the 2000-2006 period 
At the end of 2009, the tota l number of closed Cohesi on Fund projects for the 
2000-2006 period (including former ISPA pr ojects) was 299. The number of projects 
remaining for closure fell from 976 at the end of 2008 to 893 at the end of 2009. 
 
EN 26   EN Table 4 provides information on the pr ojects closed up to the end of 2009 
(per Member State).  
In total, 83 projects were closed in 2009. Th e majority of closures were notified for 
the Member States with the largest number of Cohesion Fund projects: Spain 
(30 projects closed), Greece (15 projects cl osed) and Portugal (8 projects closed). 
Table 4. Number of CF projects closed up to the end of 2009 (including ex-ISPA) 
Projects closed as of end 2009 
Member State Total 
number 
of CF 
projects Number 
of 
Projects Total Paid in 
Euro Number of 
open 
projects as 
of end 2009 
Czech Republic 58 19 350.331.885 39 
Estonia 37 20 106.548.425 17 
Greece 124 49 1.150.632.586 75 
Spain 407 110 2.969.559.629 297 
Ireland 10 4 357.368.796 6 
Cyprus 2 0 0 2 
Latvia 46 10 44.331.604 36 
Lithuania 51 13 159.495.999 38 
Hungary 47 11 26.071.037 36 
Malta 3 0 0 3 
Poland 130 6 68.915.348 124 
Portugal 109 32 810.129.887 77 
Slovenia 28 10 72.460.238 18 
Slovakia 39 9 60.041.606 30 
EU 14 1.091 293 6.175.887.040 798 
Bulgaria 38 3 27.044.270 35 
Romania 63 3 2.191.214 60 
EU 2 101 6 29.235.484 95 
Total 1.192 299 6.205.122.524 893 
 
EN 27   EN 3. T HE IMPLEMENTATION OF THE 2000-2006  PROJECTS BY MEMBER STATE  
3.1. Greece 
3.1.1. Environment 
In the environmental sector 94 projects  were adopted, contributing to waste 
management, the treatment of waste water,  drinking water supply, rehabilitation of a 
lake and prevention of forest fires. The aim of these projects is to contribute to 
implementing the relevant EU Directives.  
Progress was noted during 2009, in particul ar in relation to those Cohesion Fund 
projects that involve waste water treatment plants. Howeve r, the rate of performance 
of the environment projects differs from one sector to another. While the waste water 
treatment projects are relatively well advan ced, projects on solid waste infrastructure, 
drinking water and nature  protection projects − and in particular major projects such 
as the construction of dams − are being seriously delayed due to administrative 
hold-ups or public reactions. Close monitoring, including site visits, continued to be 
implemented by the Commission services in 2009 in order to ensure that the projects 
would be completed and operational within  the allotted timeframes. A number of 
projects continue to pose problems of low uptake and implementation in the field of 
waste management mainly in Attiki, in cluding major Cohesion Fund projects for 
drinking water supply and a nature project. 
However, it should be noted that delays in the implementation of projects may also 
be due to social reactions. The slow impl ementation of certain projects may also be 
linked to the requirement to implement a nu mber of requirements that derive from 
relevant Directives and are reflected in the specific term s of the funding decisions. 
Since 2002, Cohesion Fund decisions include certain specific clauses the fulfilment 
of which, in a number of cases, is a precondition for the execution of either the advance or interim and final payments. Th ese specific clauses can be divided into 
those of an administrative nature (e.g. se tting up of a management body for solid 
waste or of an agency to manage the opera tion of a dam), and those of a legal or 
technical nature (e.g. the co mpletion of the legal framework relating to solid waste 
management or certain actions considered necessary for the integrated management 
of solid waste). The timely and efficient application and implementation of these 
requirements are directly related to the im plementation of the projects concerned.  
Most of the granting decisions have been modified following the relevant request 
from the Greek authorities. These modi fication decisions mainly concerned the 
extension of the final date of  eligibility, the adaptation of  the physical object of the 
funding and the financing plan. 
3.1.2. Transport 
Cohesion Fund projects on transport contribute  to the development of a sustainable 
transport policy in Greece and concern in particular the priority trans-European (TEN) road axes in Greece, i.e. the PA THE, EGNATIA, IONIA; the modernisation 
of the PATHE railway axis, which is also part of the TEN, including its 
electrification and signa lling systems; constr uction of a freight ra ilway line from the 
 
EN 28   EN port of Ikonio to the railway fr eight centre of Thriassio; the infrastructure facilities in 
different ports; and public transport infras tructures in Attica, such as the metro. 
A number of requests for modifications were dealt with in 2009 which mainly 
concern the extension of the final date of elig ibility, the adaptation of the physical 
object and the financing plan. The transpor t projects are progressing better than the 
environment projects, with motorway proj ects being particularly well advanced. 
3.2. Spain 
The year 2009 was confined to physical and financial m onitoring of ongoing projects 
leading, in particular, to interim payments  based on their degree of advancement, to 
the closure of completed proj ects and to adjustments of th e terms of assistance in 
relation to the actual situation on th e ground via changes in the Commission 
decisions granting Community assistance . 
On 1 January 2009, 328 Commission decisions (projects) granting assistance from 
the Cohesion Fund in Spain were open, ei ght of them dating from the period 
1993-1999. RAL associated with these decisions amounted to EUR 3.128 million, of which 51.1 million corresponded to the period 1993-1999. 
A total of 34 projects were closed in 2009, six of which related to the period 
1993-1999. Most of the closed projects (28) concerned the environmental sector; the 
remaining eight were related to the transpor t sector. Therefore, a total of 294 projects 
remained open as at 31.12.2009, including two from the 1993-1999 period, with a 
RAL of EUR 2.394 million, of which EUR 9 million was related to the 1993-1999 
period. This represents a decr ease of 23.5% in the RAL a ssociated with the Cohesion 
Fund for 2009. 
Despite a significant acceleration in the pace of closures compared to 2008, when 
only 12 projects were approved, the closur e process remains slow and complex 
mainly due to the problem concerning the transposition of EU Directives on public 
procurement into Spanish law, especially with regard to changes in the contracts 
being implemented by negotiated procedure.  
Many projects are likely to present probl ems of irregularities related to non 
compliance with the said Directives, but they have to be completed pursuant to 
section H of Annex II to Regulation (E C) No. 1164/94. However, the organisation 
and management of such a procedure i nvolves an extremely heavy burden, both for 
the Member State and for the services of the Commission and, given the number of 
procedures that need to be initiated in the case of Sp ain, there is a case for looking 
into the technical and legal feasibility of a flat-rate so lution, for example through a 
flat-rate financial correction. 
3.2.1. Environment  
Regarding changes in the condi tions for granting aid, in 2009  a total of 71 amending 
decisions were approved, almost all of whic h were within the environmental sector. 
In general, the changes affect the date of completion of works, which is normally 
extended to 31.12.2010, often accompanied by - usually minor - changes to the 
 
EN 29   EN physical subject of the projec ts. The changes have had no impact on eith er the total 
eligible costs of projects or Community assistance. 
Also, in terms of changes, we are seeing a significant increase compared to 2008 
when only 29 amending decisions were approved. This is probably due to the 
presentation to the COCOF in 2008 of the "Guidelines for the amendment of 
decisions taken by the Commission for C ohesion Fund projects on the basis of 
Regulation (EC) No 1164/1994 as amended"  (COCOF 08/007/01) laying down the 
"one change rule".  
As regards payments (intermediate and fi nal balance), a total of 162 requests for 
payments have been implemented for an amount equivalent to EUR 712 million. 
Compared to the year 2008, this represents  a decrease in term s of payment claims 
(184 in 2008) and an increase in terms of amounts paid (EUR 644.5 million in 2008). 
3.2.2. Transport 
In 2009, the Commission services paid partic ular attention to the implementation of 
projects in the port sector and the program ming of the sector for 2007-2013, so as to 
ensure a coherent port polic y in respect of co-financi ng by both the ERDF and the 
Cohesion Fund. In fact, the effort of Europ ean solidarity in financing this type of 
transport infrastructure during the pe riod 2000-2006 represents EUR 1,586 million, 
of which EUR 1,170 million is from the Cohesion Fund. An aid amount of EUR 981 million is planned for the period 2007-2013, of which EUR 479 million comes from the Cohesion Fund. 
On 1 April 2009, A meeting was therefore held in Madrid with the Spanish 
authorities in charge of port policy, at whic h the latter explained their strategic vision 
of port policy as a combination of local traffic forecasts fo r which the port authorities 
were responsible, and forecasts of intern ational traffic and its distribution between 
different ports that depended on "Puertos de Estado". This policy is formalised in a plan in which the investments funded must be: consistent with the overall strategy, 
technically appropriate, and financially viable. 
3.3. Portugal 
3.3.1. Environment 
The projects under implementation help to promote, develop and complete the basic 
environment infrastructure as well as to  ensure the conditions for sustainable 
development, environmental protection and management of natura l resources. These 
projects relate to the priority sectors of  "Water Supply", "Sewerage and Wastewater 
Treatment" and "Urban Waste Management",  in line with the reference framework. 
During 2009, nine amending decisions were ad opted to make general adjustments to 
the final specifications of projects, mos tly in order to include new additional 
elements and/or to revise othe rs, and to prolong the end date. 
In 2009, three environmental projects we re closed: "ETAR de Sobreiras", 
"Tratamento de Resíduos do Baixo Támega " and "Tratamento de Resíduos do Norte 
Alentejano"; this left 56 projects/groups  of projects open at the end of 2009. 
 
EN 30   EN As at December 2009, thirteen environmental projects were already in the process of 
closure. From a financial point of view th e most significant projects are "Tratamento 
de Resíduos da Madeira" (with a tota l Fund contribution of EUR 72 million), 
"Abastecimento e Saneamento de Águas de Trás-os Montes e Alto Douro – Fase 1" 
(EUR 52 million), "Abastecimento e Saneamento de Águas de Raia, Zêzere e Nabão – Fase 1" (EUR 45 million) et "Abastecim ento e Saneamento de Águas de Trás-os 
Montes e Alto Douro – Fase 2" (EUR 43 million). 
The other 43 open projects we re still being implemented a nd had not got as far as the 
closure procedure; th e most relevant projects from the point of view of the EU 
contribution are "Abastecimento e Saneamento de Águas de Trás-os Montes e Alto Douro – Fase 3", "Abastecimento e Saneamen to de Águas de Raia, Zêzere e Nabão – 
Fase 2", "Abastecimento e Saneamento de Águas do Minho Lima – Fase 2" et 
"Abastecimento e Saneamento de Águas do Oeste (each intervention receiving a total 
assistance of EUR 50 million from the Cohesion Fund). 
It should be noted that three projects in  the sector of wast e treatment – namely 
"Suldouro", "Braval" et "Resitejo" - have not yet received the advance payment.  
3.3.2. Transport 
The projects being implemented cont ribute to the development of the 
Trans-European Transport Network and enhance multimodal articulation between the various means of transport in place, in line with the objectives of the reference 
framework. 
During the year, three amending decisions we re adopted for the same general reasons 
of adjusting the description of the proj ect and extending the date of conclusion. 
In 2009, four transport projects were clos ed, "Linha do Algarve – Ermidas / Faro", 
Linha do Minho – Lousada c/ Nine", "Euromin as" et "Aerogare de Lajes". At the end 
of the year, seventeen projects were still open. 
Nine transport investments were at the closure proce dure stage in December 2009; 
from a financial point of view the most relevant ones are "Linha do Algarve – Coina 
/ Pinhal Novo" (with a total Fund contribu tion of EUR 86 million), "Linha do Minho 
– Nine / Braga" (EUR 47 million) et "Porto do Caniçal" (EUR 41 million). 
The other eight open projects were still be ing implemented and had not yet reached 
the closure procedure stage; five of th em receive a contribution in excess of 
EUR 100 million from the Fund, namely: "Linha do Norte – Vila Franca / Vale de Santarém", "Metro de Lisboa – Orie nte / Aeroporto", "Linha do Norte – 
Entroncamento / Albergaria", "Metro de Li sboa – Baixa Chiado / Santa Apolónia" et 
"Linha do Norte – Quintans / Ovar". 
Technical Assistance 
At the end of 2009, three technical assist ance decisions still remained open. No 
projects were closed. One ame nding decision was adopted in 2009. 
 
EN 31   EN 3.4. Cyprus 
The Cohesion Fund for Cyprus amounts to approximately EUR 54 million in 
Community contributions. Two projects ar e co-financed by the CF: one transport 
project (upgrade of the Li massol motorway) and one envi ronmental project (solid 
waste management covering the regi ons of Larnaka-Ammochostos).  
A survey of both projects was carried out  under the partnership with the Cypriot 
Authorities in order to ensure the sound fi nancial management of the Cohesion Fund 
projects. The transport projec t has been completed and th e final payment request is 
expected to be submitted in the coming months. 
As for the environmental sector, it should be emphasized that the implementation of 
the project has been delayed due to r eactions from the residents of nearby 
communities, due to the relocation of part of the project. In view of the above situation and the related slow absorption, th is project was the su bject of a specific 
technical meeting with the Cypriot Authorities in June 2009. An updated 
modification request, which included an extension of the eligibility date, was 
submitted at end 2009 and the amending decisi on adopted in January 2010 fixed the 
eligibility end date  for the expenditure and works at 31.12.2010. 
3.5. Czech Republic 
3.5.1. Environment 
The implementation of the Cohesion Fund projects in the environment sector is 
progressing satisfactorily. Out of 38 projects approved in the 2000-2006 
programming period, ten were closed, one is  in the closure procedure, and closure 
procedures have been initiated for four ot her projects. The majority of the on-going 
projects are in the final stage of implementation. 
In 2009, the Commission dealt with eight requests to amend the Commission 
decision. By the end of the year, seven am ending decisions had been adopted. Most 
of the modifications concerned the extens ion of the end date of eligibility and 
changes to the scope of the project. 
At the request of the Czech authorities, th e services of the Directorate-General for 
Regional Policy launched an assessment to  examine whether the specific condition 
governing the private operating contracts in the water sector, inserted in eleven 
Commission Cohesion Fund decisions, had be en met. The final assessment report 
(June 2009) came up with clear recommendati ons which the Czech authorities have 
now begun to implement. The proper implementation of the recommendations of the Directorate-General for Regional Policy will be  an important feature of the closure of 
the eleven environmental project s under the CF mentioned above. 
3.5.2. Transport 
In the transport sector, implementation is we ll advanced for most of the projects. In 
2009, the closure procedure was launched for three projects . So far, five out of 
thirteen approved projects have been clos ed. No modification requests were received 
in 2009 in the transport sector. 
 
EN 32   EN 3.6. Estonia 
3.6.1. Environment 
The Commission has issued financial deci sions for 21 environmental projects under 
the Cohesion Fund (four of them are techni cal assistance projects). By the end of 
2009, twelve projects were closed and one wa s in the process of being closed. Eight 
projects - including one tec hnical assistance project -wer e being implemented, with a 
total allocation of EU R 192,187,936 (the average a ssistance rate under the 
Cohesion Fund is 76.19% or EUR 146,427,988). 
Due to the overheating of the constructi on market, significant price increases 
occurred between 2006 and 2008 which delayed implementation, forcing a slimming down of the initial scope of projects and requir ing an additional national contribution 
in order to finalise the pr ojects. This situation was reversed in mid-2008. All 
environmental projects that had been delayed in 2007 and 2008 made good progress 
in 2009. All environmental projects are expe cted to be ready by the end of 2010. 
The main problems hindering proper impl ementation are due to delays in the 
progress of project implementation, which them selves are mainly the result of delays 
in the design and/or constr uction, and/or cost overruns. 
3.6.2. Transport 
The Commission has issued financial decisi ons for fifteen transport projects under 
the Cohesion Fund (five of which are techni cal assistance (TA) pr ojects). By the end 
of 2009, eight projects were closed.  
Works have started on the ground on all projects.  There have been delays due to cost 
increases, but to a lesser extent than in the environmental sector. No projects are at 
risk of not being implemented by the end of 2010. 
Project 2006/EE/16/C/PT/001 "Eastern Exte nsion of Muuga Harbour" was amended 
in 2009 to take into account the impact of crises (changed demands in relation to additional port capacity). 
Technical assistance has helped prepare transport infrastructure projects for 
implementation in the new programming pe riod. Two major project applications 
were developed in 2009 from the TA proj ects financed with technical assistance 
from the Cohesion Fund. 
3.7. Hungary 
3.7.1. Environment 
In the environment sector there are 25 Cohesion Fund/ex-ISPA projects (one 
technical assistance project and 24 investment projects). The overall 
payment/commitment rate is 61%. The contra cting rate is mainly above 90% and in 
several cases it is 100%. In the case of four projects, the contracting rate is between 
75% and 85%: these projects concern Buda pest (75%), South Balaton, North East 
Pest and the North Great Plain (86%). 
 
EN 33   EN Two projects - namely the North East Pest and North Balaton waste projects - are at 
risk of not being completed by 31 Decem ber 2010. The test run of the wastewater 
treatment plant at the Debrecen wastewat er project will likewise extend beyond 
2010. 
In 2009, the Commission adopted ten (10) amending Decisions, mainly concerning 
the extension of the final date of elig ibility until 31 Decemb er 2010, cost savings 
(mainly as a result of changes in the tax la w of the Member State) and the inclusion 
of new project elements, as well as cost  overruns in the case of waste projects. 
Decisions on another five requests for modifications in environment projects, 
submitted by the Hungarian authorities, are to be taken in 2010. 
3.7.2. Transport 
There are twelve Cohesion Fund/ex-ISPA pr ojects in the transport sector (three 
technical assistance and nine investment pr ojects – one for air tr ansport (closed), six 
for road transport and two for rail). The overall payment/commitment rate is 78%. 
The contracting rate is mainly above 90% and in several cases is as high as 100%. 
One project has been closed. 
The Hungarian authorities have not signa lled any risks of non-completion for any 
specific projects.  
In 2009, the Commission adopted four modifi cation decisions, mainly concerning the 
extension of the final date  of eligibility until 31 December 2010, cost savings 
(mainly due to changes in the tax law of th e Member State) and the inclusion of new 
project elements, as well as cost overr uns in the case of waste projects. 
3.8. Latvia 
3.8.1. Environment 
The Commission has issued twenty-six C ohesion Fund decisions for environmental 
projects (including four techni cal assistance projects). In total, out of the twenty-six 
projects by the end of 2009, two projects had been closed, eleven closure files were 
pending with the Commission (although three additional projects were closed in 
early 2010), and thirteen pr ojects were still ongoing. 
During 2009 the Commission authorised ten interim payments amounting to 
EUR 23.29 million. 
For six of the pending closure files, fina ncial corrections of EUR 1.58 millions were 
proposed as a result of the wrongful award of  supplementary contracts. The hearings 
are due to be held in 2010. 
For one project the amount of works to be im plemented by the final date of eligibility 
is still very substant ial and, as a result, this is rega rded as a high risk project. The 
Commission is monitoring progress closely. 
In 2009, the Commission approved thr ee modifying decisions. The approved 
requests for modifications includ ed the following adjustments: 
 
EN 34   EN 2002LV16PPE009 "Development of Water Services in R ēzekne City" 
• Extension of the eligibilit y date until 31 January 2009; 
• Adjustments to some of the physical indi cators and to the description of the 
project as a result of a new technical so lution found for the rehabilitation of the 
waste water treatment plant. 
2005LV16CPE002 "Hazardous waste management system in Latvia, Stage I" 
• Extension of the eligibil ity date until 31 December 2010. 
2004LV16CPE001 "Development of Water Se rvices in Ventspils, Stage II" 
• Ceiling of the cumulative payments raised to 90%; 
• Amendments of the physical indicators and description of the project due to 
readjustments caused by cost increases. 
3.8.2. Transport 
The Commission has issued eighteen Cohesi on Fund decisions for transport projects 
(including four technical assi stance projects). In  total, by the end of 2009, seven out 
of the 18 projects were closed, two closure files were pending before the 
Commission (one of which was closed in early 2010), and nine projects were 
ongoing. 
During 2009, the Commission authorised five interim payments amounting to 
EUR 18.36 million. 
For one project the amount of works to be im plemented by the final date of eligibility 
is still very substantia l and, as a result, this project is regarded as a high risk project. 
The Commission is closely monitoring progress. 
In 2009, the Commission approved one m odifying decision which included the 
following adjustments: 
2005LV16CPT003 "Reconstruction of access ro ads to Liepaja Port in Latvia" 
• Extension of the eligibilit y date until 31 December 2010; 
• Amendment of the physical indicators and the description of the project in the 
light of updated information obtai ned from the detailed design. 
3.9. Lithuania 
3.9.1. Environment 
Twenty-nine environmental projects we re adopted under th e Cohesion Fund (and 
ex-ISPA) in the period 2000-2006, of which 16 are in the waste water sector, 11 are 
in the solid waste sector, and two are technical assi stance projects. 
 
EN 35   EN Prior to 2009, two waste water projects were  closed. No closure procedures were 
completed during 2009. The Commission serv ices are currently assessing five 
closures: for one project the closure procedure was initiated in 2008 and for the other 
four projects the closure proce dures were initia ted during 2009.  
Nine amending decisions were adopted in  2009. These mainly covered reduction of 
scope due to cost overruns, adjustment of physical monitoring indicators and 
extension of the end date. In  addition, six requests for modification were received. 
3.9.2. Transport 
Twenty-one transport projects were adopt ed under the Cohesion Fund (and ex-ISPA) 
during the period 2000-2006; eleven of these pr ojects are in th e road sector, six are in 
the railway sector, and four are technical assistance projects. 
Seven projects were closed before 2009. Th e closure procedure in itiated in 2008 for 
one transport project was successfully comp leted in 2009. Two further projects were 
closed in the course of 2009 and one was completed in January 2010. 
In 2009, Lithuania submitted four requests to modify transport sector projects. The 
modifications included extension of eligib ility deadlines and adjustments of the 
physical monitoring indicators. 
Technical Assistance 
In addition to the sectoral assistance, co -financing has been granted to one project 
aimed at strengthening the administrative capacity of Cohesion Fund management in 
Lithuania. The project is on-going. 
3.10. Malta 
3.10.1. Environment 
The project "Upgrading of Sant'Antnin wast e treatment facilitie s" (CCI No. 2004 MT 
16 C PE 001) covers the c onstruction of a mechanical treatment plant for the pre-
treatment of household waste, a material r ecycling facility, an anaerobic digestion 
plant for the treatment of biodegradable waste, as well as the installation of a waste water treatment facility (a reverse osmosi s plant). The main outcome is the reduction 
of the negative environmental impact of the waste cycle, and in particular the 
reduction of the amount of landfilled wast e, which is an issue of the utmost 
importance for the Malta main island on account of its very high population density (1.500 inhabitants / km²). 
The Commission decision approving this pr oject was amended on 13 August 2008 in 
order to take into account the availability  of more detailed designs suggesting the 
construction of a new mechanical treatmen t plant instead of upgrading th e existing 
one, as well as a reverse osmosis plant to treat the waste water produced. The 
modification of the initial Commission deci sion likewise extended the deadline for 
the eligibility of expenditure until 31 December 2010.  
The project is making good progress, a nd the Commission's payment/commitment 
ratio for the project reached the ceiling of 80%; the actual ratio of payments to total 
 
EN 36   EN eligible costs is 73.26 %. The material recy cling facility has b een completed, and the 
acceptance certificate for the final handover was issued on 17 May 2008. The 
digestion plant and the mechanical trea tment plant are 70% and 80% completed 
respectively. 
3.10.2. Transport 
The project "Restoration and upgradi ng of sections of TEN-T" (CCI 
No. 2004 MT 16 C PT 001) consists of the upgrading of three lots of the TEN-T 
network in Malta and Gozo (St. Paul's Ba y by-pass, Civil Aviation Avenue in Luqa 
and Mġarr Road in G ħajnsielem in Gozo) with the aim of reducing travel time, 
lowering accident rates and transport costs, and facilitating competitiveness in the transportation of goods. 
The Commission decision approving this project was modified on 17 October 2008, 
to cover the transfer of funds between the project sec tions and to exte nd the deadline 
for the eligibility of e xpenditure until 31 March 2010. A request for a second 
modification of the project was submitted to  the Commission in July 2009 in order to 
utilise savings made in the project (EUR 519,496.91) for the upgrading of an 
additional 350 m stretch of the M ġarr Road. The amending decision was adopted by 
the Commission on 5 February 2010. A Commission decision correcting an 
administrative error in the second amending decision was adopted on 23 March 2010. The new deadline for th e eligibility of expenditure is 
31 December 2010. 
The physical elements of the original pr oject are completed; financial completion 
(actual payments made/total eligible cost s) is at 92.96%. A new works contract for 
the reconstruction of the a dditional stretch of the M ġarr Road was published on 
14 July 2009. The Commission's payment/com mitment ratio for the project reached 
the ceiling of 80%. 
Technical Assistance 
The aim of the TA project is to prepare the environmental projects pipeline for 
Cohesion Fund projects in the period 2007-2013 (mechanical biological waste 
treatment plants and storm water master plan). 
The Commission decision approving this project was amended on 30 July 2008 in 
order to take into account delays in the id entification of potential sites for the waste 
treatment plant and the need to comply w ith obligations arising out of Directive 
2001/42/EC. Consequently, the EIA component was removed from the first sub-project and SEA was included in  the second sub-project. In  addition, the deadline for 
the eligibility of expenditure ha s been extended to 31 December 2010. 
The project is making good progress and the Commission's payment/commitment 
ratio for the project is 80%; the actual re alised payments account  for 65.1% of total 
eligible costs. 
3.11. Poland 
In 2009, the Commission adopted 14 amendi ng decisions granti ng assistance from 
the Cohesion Fund – eight in the environmen t sector and six in the transport sector. 
 
EN 37   EN In addition, the Commission adopted eigh t corrigenda. These mostly concerned 
changes in the physical scope, the end date of the project and raising the threshold 
for interim payments from 80% to 90%. 
A substantial number of projects will no t be finalised until 2010, which means that 
the bulk of closures can be expected in 2011 and 2012. So far, six projects have been 
closed and thirteen projects were under closure procedures at the end of 2009. 
Numerous projects in both sectors posted significant cost  overruns which, in total, 
represented approximately one third of  the entire Cohesion Fund allocation for 
Poland. In both sectors the national author ities secured the additional financing for 
projects affected by cost- overruns, with the exception of three projects in the 
environment sector and one transport projec t. For the three environmental projects 
the managing authority has requested a reduction of the physical scope. For the 
transport project the request still has to be submitted.  
On the other hand, there were twenty-six  projects which achieved cost-savings 
totalling EUR 26 million of the Cohesion Fund grant. 
Two EC audits carried out on Cohesion Fund projects in 2005 and 2006 detected 
systemic errors in the area of public procurement. The Directorate-General for 
Regional Policy sent a final position le tter on 7 December 2009 (English language 
version sent on 31 July 2009). According to  working contacts until the end of 2009, 
the Polish authorities do not agree with th e financial corrections proposed by the 
Directorate-General for Regional Policy which add up to EUR 23 million for the 
twenty audited projects, but which will a ffect the overwhelming majority of the 130 
Cohesion Fund projects in Poland.  
At the end of 2009, there was only one project left with an outstanding issue relating 
to the Environmental Imp act Assessment (EIA). 
In 2009, the Commission authorised pa yments amounting to EUR 836.8 million. 
3.11.1. Environment 
The level of contracting exceeded 120% of  the originally estimated costs in 
environmental projects, which represents 95% of the total expenditure when cost 
overruns are taken into account. The physic al and financial progress on the ground, 
aggregated for the sector, was calculated at around 81% and 76% respectively. More 
than half of the projects reached the thresh old for interim payments at the end of the 
reporting period.  
Two closures were ongoing for an investme nt project in the environment sector. 
3.11.2. Transport 
The level of contracting was over 118% of th e originally estimated cost for transport 
projects, or 87% if the co st overruns are taken into  account. The physical and 
financial progress aggregated for the s ector was about 75% (both physical and 
financial). All except four transport proj ects reached the threshold for interim 
payments. 
 
EN 38   EN The closure procedure for eight investment projects was ongoing in the transport 
sector. 
Technical assistance 
Three closures were ongoing for technical assistance projects.  
3.12. Slovakia 
3.12.1. Environment 
Considerable progress was recorded in  the implementation of environmental 
Cohesion Fund projects during 2009. Delays in a number of projects have now been 
reduced thanks to the measures taken following the action plans introduced by the 
Managing Authority on the Commission's reco mmendation. It seems likely that, as a 
result of common efforts, all environmenta l projects will be physic ally completed by 
31 December 2010. 
Financial closure was completed for four pr ojects during 2009 - three infrastructure 
projects (Nitra, Martin, Považská Bystrica)  and one technical assistance measure - 
and all four were initiated. However, an other four environmental infrastructure 
projects (Poprad, Zvolen, Liptov and South East Zemplín) were interrupted owing to 
additional checks on procurement procedures . Closure procedures  also started in 
December for another two environmenta l projects (Komárno and technical 
assistance). Amending decisions were adopt ed for three infrastructure projects 
(Galanta, Šamorín, Banská Bystrica) in order to extend the eligibility date and to adjust physical indicators. Another request for modification was re ceived relating to 
the adjustment of physical indicators of the Prešov project. 
3.12.2. Transport 
Physical implementation continued to a dvance satisfactorily during 2009. For one 
road project, the D1 Mengusovce - Jánov ce motorway, a modified decision was 
approved in order to extend the end date of  eligibility until Decem ber 2010 so as to 
also include the period for notification of defects. 
Two railway projects were submitted for closure: modernisation of the Rail Track 
Šenkvice-Cífer and Stations Ra ča-Trnava and modernisation of the section Trnava-
Piešťany.  
All Cohesion Fund transport projects will be physically completed in 2010. 
3.13. Slovenia 
The Commission did not approve any new proj ects for Slovenia in  2009, as the full 
allocation had been committed by 31 December 2006. The following table presents the total number of projects and the amounts committed by sector for the entire period 2000-2006: 
 Number of projects 
adopted in 2000 - 
2006 Total commitments 
(EUR million) % of total 
commitments 
 
EN 39   EN Environment 16 129.5 50.9
Transport 8 122.1 48.0
Technical 
Assistance  4 2.7 1.1
Total CF 28 254.3 100%
In terms of commitments, the desirable 50/50 balance between the two main sectors 
of intervention, namely environment and transport, was achie ved for the period 
2000-2006. 
Two amending decisions were approved in 2009, neither of which had an impact on 
the forecasts of financial allocations. 
3.13.1. Environment 
In line with the Strategic Reference Fram ework for the Cohesion Fund, the main aim 
of assistance from the Cohesion Fund and former ISPA during the period 2000-2006 was to help municipalities and regions to improve drinking water supplies, sewerage 
networks and wastewater treatment (a total of twelve projects in the water sector) and 
waste management (four projects in total). 
In 2009, the last contract for works was succes sfully concluded bringing to an end a 
period of several years which had been characterized by delays in public procurement. As many projects are set up  as design-build, the actual construction 
lagged several months behind the date of th e contract signature.  All projects made 
significant progress, both physically and fi nancially. Construction was completed on 
a considerable number of projects and the trial operation phase for infrastructure 
began. 
Four completed projects in the water sector were closed. Two further investment 
projects and one technical assistance projec t entered the closure stage. In compliance 
with the relevant procedur es, closure of these project s and processing of final 
payments is due in 2010. 
3.13.2. Transport 
In 2003 the national authorities define d a National Cohesion Strategy for the 
transport sector which identified the objec tives of its transport strategies and the 
projects to be financed  through the Cohesion Fund. It involves the country 
establishing itself as a maritime transit country within the European Union and marketing its geopolitical position at the crossroads of two important European 
corridors (Corridors V and X) along the exis ting southern border of the EU. To this 
end, bottlenecks on corridors must first be  removed, which involves the completion 
of the motorway network, upgrading, mode rnisation and completion of the rail 
network and increasing the range  of logistical services. 
The Cohesion Fund co-finances six railway projects and two motorway projects in 
the transport sector. Following reports of  delays due to public procurement in 
previous years, all railway projects in  2009 were fully c ontracted and made 
 
EN 40   EN satisfactory progress in physic al and financial terms (a ll projects reached the 80% 
ceiling). In 2010 two already completed tran sport projects are due to be closed. 
3.14. Bulgaria 
3.14.1. Environment 
Despite slow progress in 2009, the implementation of the 25 Cohesion Fund/ 
ex-ISPA environmental projects (19 in the water sector – two in the waste sector – 
three technical assistance and one in the energy sector) was below target making it clear that a number of them will not be co mpleted by the end of the eligibility period, 
i.e. 31 December 2010. So far not a single project has been completed. 
In 2009, the Commission adopted six Modifi cation Decisions, mainly concerning the 
extension of the final date of eligibility until 31 Decem ber 2010 and the inclusion of 
new project components in order to absorb accumulated savings. 
Payments for two projects, "Construction of  Flue Gas Desulphurisation Plants at 
Units 5 & 6 of TTP Maritsa East 2 EAD" and "Kardjali Regional Waste Management 
Center" were interrupted in 2009. 
3.14.2. Transport 
The implementation of the eleven transpor t projects – five major projects and six 
technical assistance projects – was speeded up slightly in 2009. Nevertheless, this 
acceleration will not be sufficient to make up the serious delays that these projects had accumulated during the previous years of implementation. As a result, some projects will inevitably lose  Cohesion Fund assistance wh en eligibility comes to an 
end on 31 December 2010. 
In the transport sector one major project was closed in 2009, while two others were 
successfully completed. Although the procedur es for closing the two projects have 
been initiated, the process will not be fina lised in 2010 due to delays in submission 
of the closure documents by the national authorities. 
Decisions were taken in 2009 to modify four  technical assistance projects for which 
the Bulgarian authorities had submitted modification requests. The requested modifications concern the extension of the final date of eligibility and the inclusion of new components in the pr ojects in order to absorb  the accumulated savings. 
The suspension of intermediate payments for two projects in the road sector has been 
lifted and the related financial correction has been implemented. 
3.15. Romania 
Article 28 of the protocol concerning th e conditions and arrangements for admission 
of the Republic of Bulgaria and Romania to the European Union from the Treaty of 
Accession of Bulgaria and Romania provides fo r ISPA measures to be considered as 
Cohesion Fund measures and become s ubject to Council Regulation (EC) No 
1164/94 of 16 May 1994 establishing a Cohesion Fund, as amended. 
 
EN 41   EN In total sixty-three Cohesi on Fund projects were approve d by the Commission in the 
2000-2006 programming period for Romania: th irty-six were for the environmental 
protection related measures in the wa ter resources management and waste 
management sectors, twelve projects were in  the transport sector covering mainly rail 
and roads, and fifteen technical assistan ce projects linked both the environment and 
transport sectors.  
Considering the 2000-2006 programming period, the total amount of grant decisions 
for Romania is almost EUR 2,0361 million. These commitments are shared evenly 
between the environment sector (50.4%) an d the transport sector  (49.6%), including 
technical assistance related to these sectors.  
The implementation of Cohesion Fund projects  is still ongoing, w ith several projects 
experiencing delays, but with some meas urable progress being achieved during 2009. 
Three projects have made very slow progress, which is reflected by payments that are 20% or less than the amount of the committed grants, partly because these 
projects were adopted relatively late (mai nly in 2005 and 2006). Nevertheless, this is 
a substantial improvement compared to 2008, when there were 10 projects with 
payments that were only 20% or less.  
For twenty-three projects the Commissi on adopted the corresponding amending 
decisions in 2009, mostly to extend th e end dates of their eligibility. 
Total payments from the European Commi ssion to Romania fell by 6% compared to 
2008 (from EUR 319.7 million to EUR 300.7 million), bringing the total 
accumulated payments to EUR 1,392 million. Almost all of the total payments in 2009 were interim payments.  
Measures to improve the management capaci ty of the responsible  stakeholders are 
being planned, which should result in an increased number of signed contracts and 
progress on the ground. However, even this  improvement still leaves a substantial 
amount of EU funds - almost EUR 1,109.7 m illion – to be absorbed and justified 
through eligible expendi ture by the end of 2010. 
3.15.1. Environment 
Payments from the Commission to the environment-related infrastructure projects in 
2009 amounted to EUR 193.24 million, show ing a clear increase of 69.4% over 
2008. Additional projects reached payment leve ls that were more than 80% of the 
existing EU funding commitment, signifying th at works are either well under way or 
have actually been completed. In total,  thirty-four project s reached payments 
exceeding 50% of the existing EU funding com mitment, which left only four projects 
with a 50% threshold. 
Technical assistance 
There are six technical assistance projects  linked to the envir onment sector which 
focus mainly on project preparation and in stitutional strengthe ning. Four of these 
have been completed and two have already been closed from a procedural point of 
                                                
 
1 Sign "." stands for separating decimals and sign "," for thousands.  
 
EN 42   EN view. One of the two ongoing projects reach ed a payment level of 80% and the other 
75%, indicating that project implementati on is well advanced. Payments from the 
Commission to technical assistance projec ts in 2009 amounted to EUR 7.37 million.  
3.15.2. Transport 
Payments from the Commission to transport projects in 2009 amounted to 
EUR 95.21 million − a decrease of about 22% comp ared to 2008. In addition, three 
projects reached payment levels exceed ing 50% of the existing EU funding 
commitment.  
Technical assistance 
There are eight technical assi stance projects in the tran sport sector focusing mainly 
on project preparation. Two of them have b een completed and one is already closed 
from the procedural point of view. One new project has payments that exceed 50% of the existing commitments. Payments from  the Commission for technical assistance 
projects in 2009 amounted to EUR 4.44 million, which is a decrease of 67% 
compared to the situation in  the previous year (2008).  
There is one technical assistance projec t for supporting the meetings of the 
monitoring committee. 
4. M
ONITORING , INSPECTIONS , FINANCIAL CORRECTIONS AND IRREGULARITIES  
4.1. Monitoring: committees and missions 4.1.1. Greece 
A meeting of the monitoring committee wa s held in June 2009 in Thessaloniki, 
during which all current Cohesion Fund proj ects were discussed. In a spirit of good 
collaboration with the Greek authorities, a seri es of technical meetings and site visits 
took place to ensure close monitoring and follo w up, identify the critical issues, give 
a further boost to implementation and identify  actions that will ensure that all of the 
funds are utilised by 2010. 
4.1.2. Spain 
Monitoring Committees The meeting of Monitoring Committee, wh ich reviews projects co-financed by the 
Cohesion Fund, was held in Madrid on 22 April 2009. 
To prepare the meeting, nationa l authorities sent the repo rts reflecting the state of 
implementation as at 31 December 2008 for all decisions (covering a project or a 
group of projects) that were being implemented on that da te. From among these, the 
managing authority - in partnership with  the Commission - se lected 45 projects 
which, by virtue of their particular situ ation, were subject to monitoring and a 
specific analysis during the sessions of this Committee. 
 
EN 43   EN In the course of the meeting, the Commi ssion services sent all participants the 
following information: 
Given the large number of a pplications for the amendmen t of decisions taken by the 
Commission, it was recalled that , although the guidelines on the amendments to the 
Cohesion Fund decisions presented to th e Committee of the Coordination of the 
Funds (COCOF) on 27 February 2008 allow greater flexibility for the second 
amendments, these latter amendments ar e not automatic and must meet the 
conditions stipulated by December 2010. 
The need to submit all closure documents (f inal payment claim, final report, audit 
declaration) within the established dead lines was also recalled. In fact, current 
practices reveal significant delays in the submission of certain documents, and of 
audit declarations in particular.  
Lastly, the Commission wished to disc uss the Commission Re gulation (EC) No 
621/2004 of 1 April 2004 concerning publicity measures. Committee members were reminded of the vital importance of effec tive information and publicity measures, in 
order to give greater visibility to the CF projects and raise awareness of the role that 
the European Union is playing thr ough the Cohesion policy. The Commission 
thanked the Spanish authorities for the "inf ormation and publicity days" organised in 
2007 by Puertos de Estado and by the natio nal railway infrastructure company 
(ADIF) in 2008 and asked the Ministry of E nvironment to organise a similar day in 
2009 for the projects that it manages. 
Monitoring missions 
Three technical meetings took place in Ma drid on 19 February, 3 April and 17 June 
2009 respectively. Represented at the mee ting were the managing authority, the 
certification authority and the Directorat e-General for Regional Policy. Their aim 
was to address the problems faced during the day-to-day management of projects and 
the measures required to overcome them. One of the topics widely discussed was the 
analysis of closure dossiers of projects with  proposed financial corrections so as to 
prepare for a hearing under section H of  Annex II to Regulation (EC) No 1164/94. 
In addition, four monitoring missions were conducted in 2009, during which ten 
projects were visited. The first missi on was the follow-up meeting with port 
authorities mentioned above, which allowe d the Commission to visit the ports of 
Barcelona, Valencia and Sa gunto on 17 and 18 September 2009. 
The second mission was a visit to the pr ojects CCI 2005ES16CPE032 (desalination 
of seawater of Santa Eulalia) and CCI  2002ES16CPE030 (waste water treatment 
plant of San Antonio) on 15 November 2009, in order to check th e progress of these 
projects on the ground as well as to veri fy the related cer tified expenditure. 
The third mission took place on 25-27 Nove mber 2009 and concerned the projects 
CCI 2002ES16CPE006 (desalination of s eawater Tordera), CCI 2001ES16CPE054 
(EDAR of Granllers) and CCI 2002ES16CPE0 64 (improved treatment of residues in 
Tarragona).  
 
EN 44   EN The visits were necessary in order to verify certain environmental conditions in the 
first project, to investigate a problem of description of the works in the second case 
and to ensure that the project was fu nctioning correctly in the last case. 
The fourth and last visit took place on 26 and 27 November 2009, to see and discuss 
the project CCI 2000ES16CPE140 (underground c ontainers for selective recycling in 
Ciudad Real) and CCI 2005ES16CPE020 (wastewa ter treatment in Tablas Daimiel). 
For the first project, the purpose of the visi t was to verify certain points included in 
the Winding-Up Declaration to accelerate project closure,  whereas - in the second 
case - the objective was to discuss on the ground a request by the Member State for an amendment to the decision. 
4.1.3. Portugal 
Monitoring Committees Pursuant to the internal regulation of th e Portuguese Monitoring Committee relating 
to the Cohesion Fund infrastructures fo r the 2000-2006 period, these meetings are 
held twice a year. 
The two 2009 Monitoring Committee meetings were held in Lisbon, the first taking 
place on 14 May 2008 and the second on 27 November 2008.  
Given that it has been im possible since the end of 2006 to approve any financial 
changes, the aim of the Committee was to follow up the implementation of the projects, and to resolve probl ems related to deadlines, clos ures and audits, as well as 
to examine the prospects for completing their implementation in the short time that remained available. At the end of 2009, of the 54 projects that had not yet got as far 
as the closure procedure, 38 investments had a closing date of 31 December 2010 
and only 22 investments had received Fund payments be low 50% of the total EU 
contribution. 
Both meetings of the Monitoring Committee were preceded by technical meetings 
between the Cohesion Fund national author ities and the Commission, in order to 
discuss the main outstanding issues, such as  closure of projects, amending decisions 
and procedures that were in terrupted for various reasons. 
Monitoring missions 
In the course of 2009, the Commission services  visited four projects ("Saneamento 
de Águas de Braga", "Abastecimento e Saneamento de águas do Minho Lima – Fase 4", "Tratamento de Resíduos do Grande Po rto – LIPOR" and "Saneamento de Águas 
da Ria de Aveiro – Barrinha de Esmoriz") in  order to take note of their progress and, 
in certain cases, to discuss with the na tional authorities any technical or legal 
problems which had arisen. 
4.1.4. Cyprus 
A meeting of the Monitoring Committee fo r the Cohesion Fund took place in June 
2009 in Cyprus. Progress in implementing the two Cohesion Fund projects was presented, while other technical issues rela ted to monitoring and reporting were also 
addressed. In addition, a specific techni cal meeting for the e nvironmental project 
 
EN 45   EN (solid waste management covering the regi ons of Larnaka-Ammochostos) was also 
held, during which a detaile d presentation was made of the progress achieved. 
4.1.5. Czech Republic 
In general, meetings of the Cohesion Fund Monitoring Committee are held twice a 
year. In 2009, the first meeting of th e Monitoring Committee took place on 23-24 
June 2009 and the second one was held on 15 December 2009. Discussions in the Monitoring Committees are organised on a project-by-project basis, using the 
monitoring sheets and allowing substantial time for the national authorities, beneficiary and the Commission to clarify a ny outstanding issues. Issues of a general 
nature are discussed in the Core Group m eeting with the national authorities.  
No monitoring missions for ongoing pr ojects were carried out in 2009. 
4.1.6. Estonia 
There were no major changes in the manage ment and control system. A contract of 
confidence was signed on 12 February 2008 between the Commission and the 
National Audit Authority. One monitoring committee meeting was held in 2009 covering implementation, quality of sp ending, financial pr ogress and publicity 
actions. 
The situation with regard to time-lags in implementa tion has been continuously 
monitored. The Commission has mainly highli ghted the need to learn from the past 
and to try to improve and build on existing experience for the 2007-2013 programming period. 
4.1.7. Hungary 
Monitoring committees Two Monitoring Committee meetings were held, in April and October 2009 
respectively. Horizontal issues and progre ss in individual proj ects were discussed. 
None of the projects reported non-comple tion by the end of 2010. Beneficiaries were 
confident of completing their projects by th is deadline, except Debrecen (where the 
test run period is to be extended until mi d 2011) and Budapest wastewater projects. 
The latter will most probably be extended until 2012. 
Monitoring missions 
The Directorate-General for Regional Policy  took part in a fi ve-day monitoring 
mission, involving the European Investme nt Bank, and visite d six wastewater 
projects and one drin king water project. 
4.1.8. Latvia 
In 2009, two Cohesion Fund Monitoring Committees took place: 
• The 10th Cohesion Fund Monitoring Comm ittee meeting was held in Riga on 
24 March 2009; 
 
EN 46   EN • The 11th Cohesion Fund Monitoring Comm ittee meeting was held in Riga on 
15 October 2009. 
The meetings were used for monitoring and assessing progress in implementation, as 
well as for discussions on any problems th at were encountered and on horizontal 
issues such as financial implementation, publicity, and technical  assistance for the 
Cohesion Fund Managing Authority.  
In both meetings the following problematic  projects were closely monitored and 
discussed: 2004LV16CPT002 "Track renova tion on stages of the East-West rail 
corridor in Latvia", 2001LV16PPT006 "Modern isation of rail signalling systems" 
and 2005LV16CPE001 "Development of the district heating supply system in 
Ventspils". 
4.1.9. Lithuania 
Two Monitoring Committee meetings took place in Lithuania, on 28-29 April and 
21-22 October 2009. The committee examined the progress reports submitted by the national authorities and discussed the impl ementation of all ex-ISPA and Cohesion 
Fund projects.  
Four technical meetings of the Cohesion Fund took place during 2009:  March 2009 (Mission to Vilnius, Lithuania)  – Meeting with the Managing Authority 
to discuss the proposed amendment of the TA project 2001LT16PPA002;  
June 2009 (Mission to Luxembourg) - Trila teral meeting concerning the preliminary 
findings by the Court of Audit during their re view of 10 CF projects in Lithuania;  
July 2009 (Mission to Panevezys, Lithuania)  - Monitoring visit to a waste project 
2005LT16CPE003, combined with a meeting on Cohesion Fund Major Projects of 
2007-2013;  
November 2009 (technical meeting in Bru ssels, Belgium) - Meeting with the 
Managing Authority and National Audit Author ity on the issues related to the closure 
of Cohesion Fund projects. 
4.1.10. Malta 
Monitoring Committees Meetings of the Monitoring Committee fo r all three Cohesion Fund projects were 
held on 11 May 2009 and on 20 November 2009. The Commission representatives attended both Monitoring Committee meetings.  
Annual progress reports were submitted for all three projects under Article F.4 of 
Annex II to Council Regulation (EC) 1164/1994, as amended.  
Monitoring missions 
No monitoring missions took place in 2009. 
 
EN 47   EN 4.1.11. Poland 
Monitoring Committees Two meetings of the Cohesion Fund Monitoring Committee were held in 2009 (on 
26 May and 2 December). The meetings were preceded by meetings of working groups for the Environment sector (on 22-23 June and 28-29 October) and the 
Transport sector (on 28 Ap ril and 3 November). The m eetings were attended by 
representatives of the mana ging authority, the paying auth ority, intermediate bodies, 
implementing agencies, social and economic partners and, in the case of working 
groups, also the final benefi ciaries of ongoing projects. 
The meetings were dedicated to a review of the progress in implementing individual 
projects. In addition, the follo wing horizontal issues were  discussed: payment rate 
and financial forecasts, cost overruns, EIA conditions, closure for ecast, modifications 
to projects in terms of scope and timeline,  and delays in implementation. Particular 
attention was paid to the m onitoring of projects that were making poor progress and 
to the results of the aud its performed by the Commission in 2005 and 2006. For more 
than one third of the overall number of projects the managing authority submitted proposed modifications concerning the e nd date, physical scope and threshold for 
interim payments to be presented to the Commission by the end of 2009.  
Monitoring missions 
No monitoring missions specific to th e Cohesion Fund were carried out. 
4.1.12. Slovakia 
Monitoring Committees Two monitoring committee meetings were held  in 2009: in Štrbské Pleso, Northern 
Slovakia (March) and Vyhne, Central Slovakia (October). The monitoring 
committees reviewed the state of progress of all current ex-ISPA and Cohesion Fund 
projects. 
In addition, key horizontal issues were discussed at these meetings: closure of 
projects, quality of final reports, impact of  financial corrections, and the need to 
apply lessons learned from  the 2000-2006 period in future major projects. It was 
suggested that the Managing Authority s hould undertake a review  of positive and 
negative aspects of project implementa tion in the period 2000-2006. It was also 
recommended that appropriate publicity shoul d be given to projects completed and 
successes achieved (through press conferences , publicity leaflets, etc.) in order to 
emphasize the benefits of the EU's cohesion policy.  
Monitoring missions 
The geographical unit made a site visit to the Mengusovce-Jánovce project, which 
had been identified as a project at risk  of non-completion by end-2010. However, the 
mission proved the contrary, i.e. the proj ect was on track to be completed by mid 
2010 and, consequently, a request for modifica tion of this project was able to be 
discussed on site. In addition, on the o ccasion of the same March 2009 monitoring 
committee meeting, a visit was made to the completed Poprad wastewater treatment 
 
EN 48   EN project. During the October 2009 monitori ng committee, water supply and waste 
water treatment projects in Banská Bystrica and Ve ľký Krtíš were visited, both of 
which were nearing completion. 
4.1.13. Slovenia 
Monitoring Committees Two Cohesion Fund Monitoring Committee meetings were held in Slovenia in 2009. 
The meetings took place on 21 April and 4 December 2009 and focused on the 
ongoing implementation of projects, delays in public procurement, cost overruns, 
project closure and publicity. The meetings included a detailed review of all ongoing 
environment and transport projects, as well as  a discussion of financial data including 
payments and payment forecasts. The Commission highlighted in particular the need to further accelerate the implementation of  those projects, which are experiencing 
substantial delays.  
Monitoring missions 
One project visit was carried out as part  of the April Monitoring Committee meeting 
in 2009. The two projects visited (one for waste water and one for a railway) showed 
satisfactory progress towards completion. 
4.1.14. Bulgaria 
In 2009 two Monitoring Committee meetings  took place and a number of projects 
site-visits were made. The meetings of th e committee were divided into two parts: 
project and sector based t echnical discussions, followed by the official meeting to 
address horizontal issues and draw conclusions from the technical discussions. 
National authorities were as ked to prepare Action Plans indicating the steps to be 
taken in order to speed up project implementation. Furthermore, they were requested to estimate and secure the national funds th at might be needed in order to complete 
the projects after the Cohesion Fund  eligibility period had expired. 
In order to enhance co-ordin ation and co-operation between  Bulgaria and Romania, a 
Monitoring Sub-Committee for the construc tion of the Danube Bridge was set up at 
the initiative of the European  Commission, involving all rele vant parties with a stake 
in the construction of the Bridge. Two mee tings were held in 2009, one in Bucharest 
and the other in Sofia. 
4.1.15. Romania 
Monitoring Committees Two meetings of the Cohesion Fund Mon itoring Committee for the former ISPA 
environment and transport projects were held in combined sessions in 2009. Some 
visits were also made to project sites. 
The Committee discussed project specific issues , in particular for those projects that 
were regarded as more critical in terms of the progress of their implementation and 
 
EN 49   EN the horizontal aspects of implementation that were currently affecting overall 
implementation as a whole, such as low ra tes of payment and the need to improve 
payment forecasts and contract management in order to achieve a better level of 
expenditure to ensure timely completion of projects and full absorption of EU funds. 
Discussions also covered public procurement,  contract management, projects at risk 
of non-completion by the current end dates, problems of land acquisition which were 
one of the reasons for delays in some of the transport projects, cost overruns and the 
corrective measures planned by the Roma nian authorities to improve overall 
implementation and absorption of EU funding.  
Monitoring missions 
Specific missions were conducted for one of  the transport projects relating to 
navigation on the Danube, for which a sp ecific monitoring subcommittee had been 
set up. 
4.2. Audits and financial corrections 
In 2009, the focus of the audit services for the 2000-2006 period was on preparing 
for closure, with missions to review the work of national windi ng-up bodies and the 
practical closure of the Cohesion Fund projects for the 2 000-2006 period via an 
analysis of the winding-up declarations.  
Audit work for the programming p eriod 1994-1999 EU 4 (Greece, Ireland, 
Portugal, Spain)  
The closure enquiry by the Cohesion F und for the period 1994-1999 covered 10% of 
Cohesion Fund projects, representing 20% of  the co-financed expenditure during this 
period. The fieldwork was finalised in 2003 and the main deficiencies found were 
insufficient verification, resulting in ine ligible expenditure and breaches of public 
procurement rules. The follow-up and financial correction procedures resulting from the closure enquiry were all concluded by the end of 2009, apart for one remaining 
case (in Spain) which is due to be finalised in spring 2010.  
Audit work for Programming period 2000-2006 EU 16 (EU 10 + EU 4 + EU 2)
 
For EU-14 Member States, th ree audit missions for the review of winding-up bodies 
were carried out by the Dir ectorate-General for Regiona l Policy in 2009 (in Spain, 
Portugal, and Greece) in order to check th e preparations of Member States for 
closure and to identify and mitigate related risks. In addition, six further audit missions were carried out (one each in Bulgaria, Czech Republic, Greece, Hungary, and two in Romania). 
For the closure of 2000-2006 Cohesion Fund projects, the audit services of the 
Directorate-General for Regional Policy examined the winding-up declarations 
submitted by the Member States.  
Other audit work undertaken for the Cohe sion Fund included the examination of the 
national annual control reports under Ar ticle 12 of Regulation (EC) No 1386/2002 
and the review of national system audit reports submitted to the Commission. By the 
end of 2009, the majority of reports had been  analysed, and replies had been sent to 
the Member States with observations a nd, where necessary, requesting additional 
 
EN 50   EN information in order to be able to extrac t as much assurance as possible from the 
results of national audit work.  
Annual coordination meetings are held bilaterally between the Commission and 
national audit authorities to exchange information on the implementation of audit work and to discuss progress on sample checks and follow-up of audit findings. The meetings covering audit work conducted in the year 2008 were held during the spring 
and summer of 2009. The annual bilateral coordination meetings covering audit work carried out in 2009 were held in spring and summer 2010. 
Impact of controls
 
Cohesion Fund suspension decision s and financial corrections in 2009  
As part of its supervisory role, the Directorate-General for Regional Policy 
established a policy in 2008 to ensure mo re rapid adoption of decisions for the 
suspension of payments and financial corre ctions when serious systems weaknesses 
are detected. This more rigorous approach was continued in 2009. 
The overall figure of financial corre ctions for Cohesion Fund in 2009 was 
approximately EUR 70 million, compared to approximately EUR 92.7 million in 2008. This increases the total cumulative fina ncial corrections for the Cohesion Fund 
in the period 2000-2009 to EUR 227 million. No suspension decisions were adopted 
for Cohesion Fund projects in 2009. 
At the end of 2009, suspension and correction procedures were in progress for a total 
of approximately 99 Cohesion Fund proj ects (2000-2006) for an amount of around 
EUR 153 million.  
Table 5: Cohesion Fund financial corrections in 2009 by period and country (in EUR)2 
Table: Cohesion Fund financial corrections in 2009 by period and country 
(in EUR)   
(Includes correcti ons made by Member States, following agreement under the 
relevant procedure or as a result of implementation of action plans - which may 
cover more than one programme - and formal Commission decisions.) 
(Includes corrections implemented as a result of Commission audit work, but 
also corrections carried out in the c ourse of implementation or closure of 
projects)  
Member State  Cohesion Fund TOTAL 
  Period  Period    
                                                 
2 Includes corrections made by Member States, following agreement under the relevant procedure or as a 
result of implementation of action plans and formal Commission decisions. Includes corrections 
implemented as a result of Commission audit work but also corrections carried out in the course of 
implementation or closure of projects.  
 
EN 51   EN 2000-2006 1994-1999 
Bulgaria  2.413.615 - 2.413.615 
Cyprus  - - -  
Czech Republic  11 3.008 - 113.008 
Estonia  - - - 
Greece  2.452.2 89 - 2.452.289 
Spain  21.592.738 4.771.861 26.364.599 
Hungary  40.497.367 - 40.497.367 
Ireland  - - - 
Latvia  - - - 
Lithuania  649.156 - 649.156 
Malta  - - - 
Poland  - - - 
Portugal  205.714 4.987.861 5.193.575 
Romania  8.067.402 - 8.067.402 
Slovenia  - - - 
Slovakia  - - - 
TOTAL 75.991.289 9.759.722 85.751.011 
Audit opinions in the Directorate-Ge neral's Annual Activity Report for 2009 
In the Annual Activity Report of the Dir ectorate-General for Regional Policy for 
2009, an unqualified opinion was given fo r the Cohesion Fund systems in six 
Member States (Cyprus, Estonia, Greece, Ma lta, Portugal and Slovenia) In respect of 
the functioning of the management and control systems (2000-2006). 
For nine Member States, the opinion was qua lified as having a moderate impact due 
to material deficiencies affecting key elem ents of the systems (Bulgaria - transport 
sector, Czech Republic, Hungary, Latvia, Li thuania, Poland, Romania, Slovakia and 
Spain). 
Only one CF sector in a single Member State (Bulgaria - environment sector) was 
under a reservation in the Directorate-Ge neral's Annual Activity report for 2009, 
primarily owing to breaches of public procurement rules. Work is on-going in conjunction with the national authorities in  2010 to rectify the problems identified.  
 
EN 52   EN 4.2.1. Greece 
In 2009, the Directorate-General for Regiona l Policy carried out two audit missions 
in Greece for the Cohesion Fund. The first in volved a closure audit of four closed 
projects. The mission found one sub-project which was not completed or operational, 
but which had not been identified as ineligible by the winding-up body. Secondly, a 
follow-up audit of ERDF and the C ohesion Fund winding-up body (EDEL) was 
carried out in 2009, in which an action plan for the winding-up body was closed, 
since EDEL had finalised its guidance documents for closure and updated its 
categorisation of the findings and assessm ent of the systemic nature of the 
irregularities. 
As regards the follow-up of previous audits, in 2009 the Commission closed the 
follow-up of two missions which had b een carried out in 2008 and in 2007. One 
audit carried out in 2008 is still open in 2010. These missions  identified delays in the 
implementation of projects, issues ar ound revenue-genera ting projects, and 
weaknesses in public procurement procedures.  
In 2009, a financial correction of EUR 313,503  was applied by the Greek Authorities 
for the use of an irregular selection criter ion in the public procur ement procedure. In 
addition, as a result of an OLAF inves tigation of one Greek water supply project 
during 2008 and 2009, the national authoritie s took some corrective measures. 
The Greek authorities submitted twelve national audit reports and seventeen 
winding-up declarations, which were examin ed by the Commission services in 2009.  
The annual bilateral meeting with Greek audit bodies co vering audit activities in 
2008 was held in May 2009. The annual bilateral meeting covering the year 2009 took place in spring 2010. 
In the Annual Activity Report of the Di rectorate-General for 2009, an unqualified 
audit opinion was issued in respect of C ohesion Fund Greece as an action plan for 
the winding-up body EDEL had been closed in 2009, and the issues  identified with 
public procurement were addressed with  a large financial correction in 2008. 
Furthermore, each Cohesion Fund project is  audited by EDEL at least once before 
closure. In addition, as the Commission ex amines the winding-up declarations on an 
individual basis before the closure of the projects, any irregular expenditure can be 
identified and deducted at the closure of each project.  
4.2.2. Spain 
The Commission conducted one audit missi on relating to the Cohesion Fund closure 
2000-2006, which took place in Spain in 2009. The aim was to assess four closed Cohesion Fund projects and the procedur e used by the winding-up body for these 
closures. The main finding of the mission was related to irregularities involving 
changes to the contract not being detect ed by the national authorities during the 
closure procedure. 
As to the follow-up of previous Commissi on audit missions and Court of Auditors' 
findings, the audit services of the Director ate-General for Regional Policy concluded 
the financial correction procedures fo r ten Cohesion Fund 2000-2006 projects during 
 
EN 53   EN the year 2009 with a total corrected am ount of EUR 6.8 million. In six cases the 
corrections were accepted and implemented by the Spanish authorities, and in four 
cases a Commission correction of 1.3 million was made, with Spain accepting the financial correction. The final Commission correction relating to  the CF closure 
enquiry for the period 1994-1999 will  be finalised during spring 2010. 
A total of 87 winding-up declarations fo r the closure of Spanish Cohesion Fund 
projects had been analysed by the audit services of the Directorate-General for 
Regional Policy by the end of 2009 (and 157 by 24.3.2010). In many cases, irregular 
expenditure declared to the Commission was detected, mainly in relation to public 
procurement procedures and certain  issues of VAT eligibility.  
The Article 12 reports received and ex amined by the Commission covered all the 
Regional Communities of Spain, except Navarra and Cantabria and the part of the fund that was centrally managed. 
The annual bilateral co-ordination m eeting between Commission and Spanish 
auditors covering the 2008 audit exercise took place in Madrid in June 2009. During 
the meeting the auditors of the Directorate- General for Regional Policy regretted the 
absence of corrective measur es by the national authorities in relation to irregular 
additional contracts included in Cohesion Fund projects, compared to the effective 
corrective actions taken for the ERDF to reso lve the same issue. The annual bilateral 
meeting covering year 2009 is to be held in Madrid in May 2010.  
In the Annual Activity Report of the Directorate-General for 2009, a qualified 
opinion with moderate impact was given for the management and control systems of 
Cohesion Fund Spain 2000-2006, owing to mate rial deficiencies affecting key 
elements of the systems. However, no rese rvation was proposed, as it was concluded 
that the financial risk to the Community  budget is mitigated by the fact that the 
winding-up declarations are a ssessed on an individual basis before the closure of 
projects, and any irregular e xpenditure can be identified and deducted at the closure 
of each project. 
4.2.3. Portugal 
In 2009, one closure audit mission concerni ng the Cohesion Fund was carried out by 
the Directorate-General for Regional Policy in Portugal. As a result, financial corrections were proposed for four pr ojects. The adversary procedure with 
Portuguese authorities wa s on-going in early 2010. 
As for the follow-up of previous audit wo rk, financial corrections proposed by the 
Commission were accepted by the Member State in 2009 as follows: (i) a total of EUR 1,962,691.22 EUR relating to the 1994-1999 pr ogramming period; (ii) a total of 
EUR 181,162.39 EUR concerning th e 2000-2006 programming period. 
The Article 12 report and one national audit report were submitted and examined by 
the Commission in 2009. Certain elements of  the report were followed up during the 
audit mission of the Directorate-General for Regional Policy in 2009. 
Six winding-up declarations for the closure of Portugue se Cohesion Fund projects 
were analysed by the Directorate-Genera l for Regional Policy in 2009. Financial 
 
EN 54   EN corrections were proposed fo r two projects as a result of the WUD review for one 
project and in the light of the audit mission carried out in 2009. 
The annual bilateral meeting between Co mmunity and Portuguese audit bodies was 
held in May 2009 and concerned the controls  implemented as at the end of 2008. The 
annual bilateral meeting covering 2009 audit issues is due to be held in Brussels in April 2010. 
In January 2008, the Directorate-General fo r Regional Policy signed a contract of 
confidence with "Inspecção-Geral de Finanças" (Portuguese winding-up body and 
audit authority) covering th e Cohesion Fund and ERDF.  
In the Annual Activity Report of the Directorate-General for 2009 an unqualified 
opinion was given for Cohesion Fund Portugal since the winding-up declarations are 
assessed individually before the closure of  projects, in order that any irregular 
expenditure can be identified and deduct ed at the closure of each project. 
4.2.4. Cyprus 
The Directorate-General for Regional Policy carried out no audit missions in Cyprus 
in 2009. One audit which had be en carried out in 2008 to review the work of the 
winding up body for the ERDF and Cohesion Fund was closed in 2009. No financial 
corrections were made and no Cohesion Fund projects were closed in 2009 in 
Cyprus. The Directorate-General for Regi onal Policy received and analysed the 
Article 12 report and four na tional audit reports in 2009. 
Based on the positive results of the revi ew of the work of the winding up body, the 
positive conclusions from other audit missions in Cyprus, and the desk work carried out, a contract of confidence for the ER DF and Cohesion Fund was signed between 
the Commission and the Cypriot Internal A udit Service (as the official audit body in 
Cyprus) in December 2008.  
In accordance with the above, an unqualified opinion was issued for Cohesion Fund 
expenditure in Cyprus in the Annual Activ ity Report 2009 of the Directorate-General 
for Regional Policy. 
4.2.5. Czech Republic 
At the beginning of 2009, the Czech authorities submitted their final report on the 
retrospective verification exer cise initiated in 2008 at the Commission's request, in 
the context of the Action Plan  to strengthen the Commissi on supervisory role in the 
management of structural actions. The Co mmission services review ed the quality of 
the verifications carried out by the Czech  authorities during an audit mission in 
July 2009. Some systemic findings concer ning public procurement were reported 
from the exercise and the Czech authoriti es were requested to take appropriate 
corrective action. 
The Czech authorities submitted the windi ng-up declarations and final payment 
claims for eight Cohesion Fund projects in 2009. After examining the winding-up 
declarations, the Commission services requested further information on six 
declarations, in relation to the systemic findings identified by the retrospective verification exercise. 
 
EN 55   EN A financial correction procedure that was opened in 2008 with respect to a railway 
project was closed in 2009 without corre ction, after completion of the required 
adversary procedure. The Commission services opened two other correction 
procedures in 2009 following two audits perf ormed in the previous years, including 
one carried out by the European Court of A uditors as part of its declaration of 
assurance for 2006. For this case, the Czech authorities accepted a correction 
amounting to EUR 52,452 in the Cohesion Fund  assistance. The Czech authorities 
applied another correction of EUR 60,608 (corresponding to a Cohesion Fund 
amount of EUR 45,456) in 2009 following the dete ction of an infringement of public 
procurement rules in one Cohesion Fund project . It is expected that further financial 
correction procedures will be opened during 2010 as a result of the retrospective verification exercise and the scru tiny of the winding-up declarations. 
An annual bilateral coordi nation meeting with the C zech auditors covering 2008 
issues was held in Brussels in April 2009. The coordination meeti ng covering issues 
from 2009 will be held in early 2010. 
In the Annual Activity Report of the Directorate-General for 2009 a qualified 
opinion with moderate impact was given for Czech Republic Cohesion Fund projects 
for the period 2000-2006 on the basis of the a bove material deficiencies affecting key 
elements of the systems. No reservation was proposed, as the Commission is able to 
exercise close management of each Cohe sion Fund project a nd make a detailed 
check of the risk areas at closure. 
4.2.6. Estonia 
Following the positive results of audit work ca rried out in previous years, a contract 
of confidence had been signed with Est onia in 2007, covering bo th the Cohesion 
Fund and the ERDF. 
The Directorate-General for Regional Poli cy carried out no Cohesion Fund audit 
missions in Estonia in 2009, and the prev ious audit missions were followed up and 
closed in 2008. No financial correction procedures were e ither carried out or in the 
pipeline for Cohesion Fund Estonia in 2009. 
Five winding-up declarations were examin ed in the context of the closure of 
Estonian Cohesion Fund projects in 2009 and, additionally, the Directorate-General 
for Regional Policy received and analysed  the Article 12 report for the Cohesion 
Fund. The annual bilateral meeting with th e Estonian Authorities was held on 30 
April 2009. The next meeting is scheduled for April 2010.  
In the Annual Activity Report of the Di rectorate-General for 2009, concerning the 
functioning of the management and c ontrol systems (2000-2006), an unqualified 
opinion was given for Cohesion Fund Estonia.  
4.2.7. Hungary 
One public procurement audit mission was carried out in Hungary by the 
Directorate-General for Regional Policy in December 2009 in relation to the Cohesion Fund. The audit report is alr eady being prepared in early 2010. Some 
possible breaches of public procurement have been identified. 
 
EN 56   EN The Directorate-General' s 2009 Annual Activity Report for the Cohesion Fund in 
Hungary expressed a qualified opinion. The qualified opinion was linked to a reservation in 2008 originating from a sign ificant public procurement-related finding 
identified during the project audit of the Budapest Wastewater Treatment Plant in 
November 2007. A follow-up of an ECA DAS 2008 finding, which was based on an audit conducted by the Directorate-Genera l for Regional Policy (which reached the 
same findings), was carried out in 2009. Th e resulting financial correction amounted 
to EUR 40.5 million and was accepted by th e Member State in February 2009. 
One Article 12 report was examined in 2009.  Some shortcomings of a systemic 
nature were revealed in respect of accounting for and registering financial 
transactions, and error rates a bove the materiality level were  identified for projects in 
both the transport and en vironmental sectors.  
The annual bilateral meeting between Comm ission and Hungarian auditors covering 
audit work in 2008 was held in April 2009.  The annual bilateral meeting covering 
2009 issues took place in March 2010. 
Three winding-up declarations relating to th e closure of Cohesion Fund projects were 
examined during 2009.  
4.2.8. Latvia 
The Directorate-General for Regional Poli cy carried out no Cohesion Fund audit 
missions in Latvia in 2009, and all audit mi ssions from previous years are closed.  
However, during the assessment of several winding-up declarations submitted at the 
closure of Latvian Cohesion Fund projects, it  was noted that the award of additional 
works did not comply with the EU public procurement directives, which allow the 
use of negotiated procedure for additional works only on the basis of unforeseen circumstances. The same issue was also de tected during an ERDF project audit in 
Latvia. In the case of ERDF, the Latvian authorities agreed to  make the required 
financial corrections. For the Cohesion F und, however, the issue of supplementary 
contracts requires further follow-up by the Commission services. As a mitigating factor, the Latvian Authorities have issued revised guidance, to ensure that the same 
irregularities do not recur in future contract amendments.  
As a result of the above, a hearing con cerning one of the Cohesion Fund projects 
under the closure procedure was held in October 2009, and five further projects 
under the winding-up process will be subject to a hearing to be held in the first half 
of 2010 with the possibility of fina ncial corrections as a result. 
Consequently, the opinion on Latvian pr ojects under the 2000-2006 Cohesion Fund 
expressed in the 2009 Annual Activity Repo rt of the Directorate-General for 
Regional Policy is a qualified opinion. However, given that  the main risks are being 
identified by the winding up body at closure of the projects and the fact that the 
Commission services are in a position to co rrect ineligible expenditure from these 
deficiencies by assessing i ndividual winding-up declara tions, the impact of such 
deficiencies is deemed to be moderate. 
 
EN 57   EN In addition to the above, the Commission rece ived and analysed the Article 12 report, 
four national system audit re ports and three winding-up decl arations in the course of 
2009. The annual bilateral coordination m eeting with the Latvian audit bodies 
covering 2008 issues was held in May 2009 in Brussels and the meeting covering 
2009 issues took place in March 2010 in Riga.  
4.2.9. Lithuania 
The Directorate-General for Regional Polic y carried out no audits on Cohesion Fund 
projects in Lithuania in  2009, although a DAS 2008 audit by the European Court of 
Auditors, covering nine Cohesi on fund projects, did identify some deficiencies in the 
public procurement procedures (lack of co mpetition, inadequate use of negotiated 
procedure). The DAS 2008 case was followe d up by the Commission services in 
conjunction with the Lithuani an authorities in 2009.  
Apart from one mission conducted in 2008, and followed up in 2009, all other 
Cohesion Fund audits from previous years are closed. The main findings of the 2008 
mission related to cost increas es, tendering issues and the IT monitoring system. One 
financial correction of EUR 0.7 million in re spect of public procurement issues was 
concluded in 2009, with the Lithuanian auth orities agreeing to apply the correction 
themselves.  
Altogether, by the end of 2009, the Direct orate-General for Regional Policy had 
analysed 15 winding-up declarations in th e context of the clos ure of Cohesion Fund 
projects in Lithuania. Th e Article 12 report was rece ived and analysed by the 
Commission in 2009. The national authorities  raised no major issues. No national 
system audit reports were received in 2009. 
The annual bilateral meeting covering audi t issues in 2008 was held in spring 2009 
and the annual bilateral meeting coveri ng audit issues in 2009 was held in 
April 2010. 
In the Annual Activity Report of the Dir ectorate-General for Regional Policy for 
2009 a qualified opinion with moderate imp act was given in respect of Cohesion 
Fund Lithuania on the basis of the above mate rial deficiencies affecting key elements 
of the systems in Lithuania. No reservat ion was proposed, as the Directorate-General 
is able to exercise close management of each Cohesion Fund project and check in 
detail the risk areas at closure, and becau se the maximum interim payments prior to 
closure are capped at 80% of the Comm unity contribution for Cohesion Fund 
projects. 
4.2.10. Malta 
The Directorate-General for Regional Po licy carried out no audit missions or 
financial correction procedur es for the Cohesion Fund for Malta in 2009. Previous 
audit missions conducted in 2005 and 2007 did not give rise to any significant 
findings.  
The Article 12 report was received and ex amined; it highlighted sufficient audit 
coverage and a zero error rate for Cohesion Fund projec ts in Malta. No national 
system audit reports were received in 2009.  
 
EN 58   EN Accordingly, an unqualified opinion with no reservations was issued for Cohesion 
Fund 2000-2006 expenditure in Malta in the 2009 Annual Activity Report of the 
Directorate-General for Regional Policy. Th e management and control system in 
Malta can be classified as good practice. 
4.2.11. Poland 
In 2007 and 2008, the Polish authorities undert ook to implement a remedial action 
plan to ensure that all bodies in charge  of carrying out public procurement checks 
apply financial corrections when irregular ities are detected, a nd to revise their 
methodology for public procurement checks in order to ensure an adequate level of 
verification. The Directorate-General for Regional Policy closed the Action Plan in 
March 2009.  
In its letter dated 16  July 2009, the Audit Authority confirmed that the winding-up 
exercise for Cohesion Fund projects will in clude checking for the findings identified 
by the audit of 2008 of the Directorate-Ge neral for Regional Policy and that the 
winding-up documents will contai n clear conclusions in that regard. Given that the 
Audit Authority is identifying the main risks and the fact that the Commission 
services are in a position to correct any in eligible expenditure resulting from these 
deficiencies by assessing individual windi ng-up declarations, a qualified opinion 
with moderate impact was issued for Cohesion Fund Poland in the Annual Activity 
Report 2009 of the Directorate- General for Regional Policy. 
The Directorate-General fo r Regional Policy on Cohesion Fund Poland carried out 
no new audit missions in 2009. The Polish ve rsion of the Final Position Letter in 
respect of two audits where systemic de ficiencies and findings with a financial 
impact in the area of public procurement were detected (discriminatory selection 
criteria, direct awarding of additional wo rks/services, and modification of terms of 
contract after the contra ct award) was sent to the Polish authorities in 
December 2009. A financial correction of  EUR 22 million was proposed. As the 
Polish Authorities are contesting some of th e findings, it is likel y that the follow-up 
of the abovementioned audits will lead to a financial correction decision by the 
Commission in 2010. All other previous system s and project audits have been closed. 
In 2009, the Directorate-General for Re gional Policy examined ten winding-up 
declarations and/or additional informati on requested in connection with them. An 
annual bilateral meeting with Polish audit bodies was held  in Warsaw in June 2009. 
The next annual bilateral meeting was due  to be held in Warsaw in April 2010. 
In September 2009, the Directorate-General for Regional Policy organised a hearing 
for one Polish Cohesion Fund project fo r which a financial correction of 
EUR 812,562 had been proposed at the clos ure of the project. As the Polish 
Authorities are contesting the proposed co rrection, it is likely that a Commission 
decision on financial correct ion will be necessary. 
4.2.12 Slovakia 
No audit missions were carried out by the Di rectorate-General for Regional Policy in 
Slovakia in relation to the Cohesion Fund in 2009.  
 
EN 59   EN In 2009, financial corrections were proposed  for four Cohesion Fund projects in 
connection with public procurement issues  for a total amount of EUR 12 million. 
The contentious procedure is on-going. Ten winding-up declarations and the Article 
12 control report were received and exam ined in 2009. An annual bilateral audit 
coordination meeting between the Commi ssion and the Slovak audit bodies took 
place in April 2009 in Brussels. The following annual coordination meeting was held in May 2010. 
A qualified opinion with moderate impact was expressed in respect of Cohesion 
Fund Slovakia in the Annual Activity Re port 2009 of the Direct orate-General for 
Regional Policy. Shortcomings detected in  the verifications by management with 
regard to public procurement procedures  were the main reason for the qualified 
opinion. Mitigating measures taken to reduc e the financial risk for the Cohesion 
Fund included: 
• A retrospective verification carried out by the Slovak Authorities to identify the 
extent of deficiencies and to make th e necessary corrections for each project 
separately at closure; and 
• A thorough review by the Commission servic es of the closure documents for each 
Cohesion Fund project to be closed (the final expenditure stat ement, the winding 
up declaration and the final report).  
4.2.13 Slovenia 
On the basis of audit work carried out  in the years 2005-2007, a contract of 
confidence was signed with Slovenia in February 2008, covering the Cohesion Fund 
and ERDF. Following that contract, no Cohe sion Fund audit missions were carried 
out by the Directorate-General for Regional Policy in Slovenia in 2009.  
The audit work included the examina tion of the annual control report under 
Article 12 of Regulation (EC) No 1386/2002 and of the annual summary for 2009. Moreover, three winding up declarations submitted for the closure of three 2000-2006 Cohesion Fund projects were examined in 2009; these gave rise to no major remarks.  
No financial correction procedures ar e ongoing or envisaged for Cohesion Fund 
Slovenia. 
Accordingly, the Annual Activity Report of  the Directorate-General for Regional 
Policy for 2009 presented an unqualified opinion with no reservations for 
Cohesion Fund expenditure in Slovenia. 
4.2.14. Bulgaria 
Following the suspension of Cohesion F und payments to the National Road 
Infrastructure Agency (NRIA) in July  2008, the Directorate-General for Regional 
Policy carried out a verification mission in January 2009 to examine the follow-up actions taken by the national authorities wh ich had been outlined in the Commission 
Decision. On the basis of the verificati on mission of the Directorate-General for 
Regional Policy and the latter's subsequent  examination of additional information 
 
EN 60   EN provided by the Bulgarian authorities, th e Commission concluded that the required 
actions had been carried out  satisfactorily and the susp ension was lifted in May 2009. 
The Directorate-General for Regional Policy also raised concerns around the issue of 
the direct award of contract s in the environment sector in possible breach of national 
and EU public procurement rules in Bulgaria. In 2009, it requested the Executive Agency for the Audit of EU Funds (EAAEUF) to examine this issue in respect of a 
number of contracts in the e nvironment sector. The results of  this audit were received 
in February 2010. The findings related to th e illegal use of the negotiated procedure 
without prior advertising (i .e. direct award) for 16 c ontracts in the environment 
sector. Financial corrections of approxima tely EUR 4.5 million have been proposed 
by the EAAEUF.  
Furthermore, weaknesses noted during an audit mission carried out by the 
Directorate-General for Regional Policy in  November 2008 led to a road project 
being re-audited by the wi nding-up body (EAAEUF) in 2009. Financial corrections 
amounting to approximately EUR 2.4 million were proposed due to a possible conflict of interest in the public procurement area.  
As for other audit work during 2009, th e Commission received and examined the 
Article 12 report for the year endi ng 31 December 2008, but no winding-up 
declarations were submitted for Bulgarian CF projects. The annual bilateral meeting 
between the Commission and the Bulg arian audit body took place in April 2009. 
In the Annual Activity Report of the Directorate-General for 2009, a qualified 
opinion with moderate impact  was given for the Cohesion Fund transport sector in 
Bulgaria due to weaknesses in public pr ocurement, the absence of effective 
management verifications and cont inuing weaknesses in the EAAEUF. 
For the environment sector, a qualifie d opinion with signi ficant impact and a 
reservation were noted in the Directorate-General's A nnual Activity Report for 2009 
due to significant weaknesses in public procurement, the absence of effective 
management checks and continuing weaknesses in the EAAEUF. 
4.2.15. Romania 
One closure audit mission was carried out by the Directorate- General for Regional 
Policy in Romania as regards the Cohesion Fund project, Piatra Neam ţ Solid Waste, 
in 2009. Financial corrections made by th e national authorities amounted to EUR 
2,614,915. The adversary procedure with Romani an authorities is on-going in 2010. 
A second audit mission by the Directorate- General for Regional Policy in May 2009 
dealt with the decentralisation of functions to final beneficiaries. 
A hearing with the Romanian authorities  was held on 5 March 2009 concerning six 
audit missions carried out between 2006 and 2008. Financial corrections for a total 
amount of EUR 8,064,402 proposed by the Commission were accepted by the 
Member State in 2009. 
A second hearing with the Romanian authorities was held on 29 April 2010 
concerning a public procurement audit mi ssion in 2009. The Romanian authorities 
accepted financial corrections in respect of the irregular use of the experience 
 
EN 61   EN criterion in the award phase of an evalua tion procedure. The Romanian authorities 
disagreed with the financial corrections in respect of the shortening of the deadline 
for the submission of bids. A Commission (cor rection) decision is to be adopted for 
the latter. 
The Article 12 report was submitted and examined by the Commission in 2009. 
Certain aspects of the report were follo wed up with the national authorities. A 
satisfactory reply has been received  from the Romanian authorities. 
Three winding-up declarations, related to the closure of Cohesion Fund projects, 
were examined in the course of 2009. No financial corrections were proposed on top 
of those already carried out following the c ontrol activities of the national authorities.  
The annual bilateral meeting between the Commission and the Romanian audit body 
was held in June 2009 and related to c ontrols carried out by the end of 2008. The 
annual bilateral meeting covering 2009 aud it issues was held in Brussels in 
April 2010. 
In the Annual Activity Report of the Directorate-General for 2009, a qualified 
opinion with moderate impact was issued fo r Cohesion Fund Romania, mainly owing 
to weaknesses in the area of public procurement, management verifications and 
computerised monitoring system. In 2010, wo rk is on-going to rectify the problems 
identified, in conjunction w ith the national authorities. 
4.3. Irregularities notified by the Member States 
In 2009, in accordance with Regulation (EC) No 1831/943, the Member States 
communicated to the Commission 109 notificati ons of irregularities involving a total 
amount of EUR 67,304,951 in respect of proj ects co-financed by the EU. An amount 
of EUR 56,673,503 has been recovered, and the remaining amount has yet to be recovered. The countries which reported th e most cases are Portugal, Spain and 
Poland (27, 20, and 19 respectively). Portugal reported 39% of the amount involved. 
It is also worth noting that Hungary, with four notificati ons, is the second highest on 
the list in terms of the amount involved. In addition, during the same period, pursuant to Regulation (EC) No 1828/2006
4 which applies to the programming period 
2007-2013, Bulgaria communicated to th e Commission 17 notifications of 
irregularities involving a total allocated  amount of around EUR 3.6 million in respect 
of projects co-financed by the EU. 
Although the number of notifi cations has decreased signif icantly compared to the 
previous year5, the amount involved remains the same. The main types of 
irregularities reported are ineligible expenditure a nd infringements of public 
procurement rules. These two typologies cover nearly 75% of  all reported cases. 
                                                 
3 OJ L 191, 27.07.1994, p.9, as amended by Regulation (EC) No 2168/2005, OJ L 345, 28.12.2005 
4 OJ L 371, 27.12.2006, p.1, as amended by Regulation (EC) No 846/2009, OJ L 250,23.09.2009 
5 2008: number of communicated cases 140; overall amount related to the communications EUR 
56,328,911. 
 
EN 62   EN Table 6: Irregularities communicated by Member States in 2009 (in EUR) 
Member State Number of 
irregularities Financial amounts Amounts awaiting 
recovery 
Bulgaria  17 3.578.740 3.578.740 
Cyprus  0 0 0 
Czech Republic  3 1.924.920 0 
Estonia  0 0 0 
Greece  14 4.780. 520 1.68 4.211 
Spain  20 4.351.765 3.622.443 
Hungary  4 18.449.851 40.387 
Ireland  0 0 0 
Latvia  0 0 0 
Lithuania  2 4.491.703 0 
Malta  1 39.133 39.133 
Poland  19 2.275.178 49.542 
Portugal  27 24.575.760 1.332.009 
Romania  0 0 0 
Slovenia  1 2.552.398 0 
Slovakia  1 284.983 284.983 
TOTAL 109 67.304.951 10.631.448 
5. E VALUATION  
The Commission and the Member States carry out the appraisal and evaluation of all 
co-financed projects. The pr ojects to be financed by the Fund are adopted by the 
Commission in agreement with th e beneficiary Member States. 
The Commission carries out the ex-post evaluation of the Cohesion Fund. The 
previous evaluation was published in 2005 and looked at a sample of 200 projects 
implemented during the period 1993-2002. A new ex-post evaluation was launched 
in 2009 examining all Cohesion Fund and former ISPA projects implemented during the years 2000-2006. As part of a set of th ree interlinked "wor k packages", the 
evaluation will assess the contribution of the Cohesion Fund and ISPA (i) to the 
development of the EU transport system, (ii) to achieving the EU acquis  in the field 
of environment and (iii) to the impact of  ISPA as a preparation for the programmes 
of the Structural and Cohesion Funds. In addition, ex post cost-benefit analyses will 
 
EN 63   EN be conducted for a sample of transport and environment projects, to identify lessons 
for future programming periods. 
6. I NFORMATION AND PUBLICITY  
6.1. Information to/from the Member States 
As indicated in the annual report for 2007,  as from 1 January 2007 all issues 
concerning the Cohesion Fund have been d ealt with in the Coordination Committee 
of the Funds (COCOF, according to Regulation (E C) No 1083/2006). 
Several issues of common interest for ER DF and the Cohesion Fund were presented 
or discussed during the meetings of the COCOF. These include: 
• Commission Regulation amending Regul ation (EC) No 1828/2006 setting out 
rules for the implementation of C ouncil Regulation (EC) No 1083/2006 laying 
down general provisions on the European Regional Development Fund, the European Social Fund and the Cohe sion Fund and of Regulation (EC) 
No 1080/2006 of the European Parliament and of the Council on the European Regional Development Fund; 
• Commission Decision amending the Decisi on concerning the financing of the 
programme for the use of operational a nd non-operational technical assistance at 
the initiative of or on behalf of the European Commission under the European Regional Development Fund (ERDF) and the Cohesion Fund (CF) for 2009; 
• Commission Decision concerning the financ ing of the programme for the use of 
operational and administrative technical assist ance at the initiative  or on behalf of 
the European Commission under the European Regional Development Fund (ERDF) and the Cohesion Fund (CF) for 2010; 
• Fraud indicators for ERDF, European Social Fund (ESF) and CF; 
• Evaluation Methods: Reporting on Core I ndicators for the European Regional 
Development Fund and the Cohesion Fund (2007-2013). 
6.2. Commission measures on publicity and information 
As regards the Commission measures on information and publicity, the focus in 2009 
was two-fold. First, to ensure the publicati on of the list of bene ficiaries of EU Funds 
managed by the Commission in partnership wi th Member States in line with Article 
7.2 of Commission Regulation (EC) No 1828/2006. Second, publication by the 
Directorate-General for Regional Policy of the details of major projects, including 
those financed by the Cohesion Fund, fo r both of the periods 2000-2006 and 
2007-2013. The details of many of these pr ojects are available in a searchable 
database on the INFOREGIO website. To date , there are over 300 projects listed in 
the database (which include major projects and other pr ojects financed through the 
2007-2013 programmes).  
 
EN 64   EN ANNEX:  IRREGULARITIES AND FINANCIAL CORRECTIONS  
During 2009, one decision on a financial correction was adopted for the 2000-2006 
Cohesion Fund projects for an amount of EU R 1.8 million. In addition, at the request 
of the Commission, the Member States ag reed to exclude a further EUR 72 million 
from their statements of expenditure. 
As a result, for the 2000-2006 programming  period, the financial corrections 
adopted/agreed (on an accrual basis) resulting from the audit work of the Directorate-General for Regional Policy, amounted to EUR 76 million. 
The table illustrates the amount of fina ncial corrections per Member State. 
Table: Financial corrections in 2009 for the Cohesion Fund, period 2000-2006 
Member State Accepted by 
MS EC Decision 
Bulgaria 2.413.615 -
Cyprus - -
Czech Republic 113.008 -
Estonia - -
Greece 313.503 2.138.786
Spain 19.802.272 1.790.466
Hungary 40.497.367 -
Ireland - -
Latvia - -
Lithuania 649.156 -
Malta - -
Poland - -
Portugal 205.714 -
Romania 8.067.402 -
Slovenia - -
Slovakia - -
TOTAL 72.062.037 3.929.252
TOTAL 75.991.289 
 
EN 65   EN  
The above table does not include the results of the Member States' own checks of 
Cohesion Fund expenditure.