WRITTEN QUESTION P-1840/02

by Sérgio Marques (PPE-DE) to the Commission

(24 June 2002)

Subject: Social and economic cohesion policy and the outermost regions in the post-2006 period

Madeira has received support from the Structural Funds, the Cohesion Fund, the EIB and other existing financial instruments, and this has enabled the island's serious social and economic underdevelopment (by comparison with most other European regions) to be gradually remedied. However, it will still take some time for the island to be brought up to the average level of Community development, for which reason Community aid continues to be essential.

Consequently, Madeira and the other outermost regions take an apprehensive view of the post-2006 social and economic cohesion policy reform as described in the document entitled Initial contribution from the outermost regions to the future of social and economic cohesion policy. The need to support the applicant countries' most disadvantaged regions, combined with the plan to maintain financial resources at their current level, suggests that there will be inadequate resources to meet the needs of all the underdeveloped regions.

Although the Commission (in its most recent report on cohesion policy) seems willing to take the specific, legally enshrined status of the outermost regions into consideration in its policy review, the truth of the matter is that those regions would appear to have been penalised right from the outset. If, in an important area such as the Objective 1 eligibility criterion, the Commission carries through its stated intention (namely, of retaining per capita GDP lower than 75 % of the Community average as the criterion), the current Objective 1 regions (which include the outermost regions) will quite artificially be made to appear more wealthy by virtue of the accession to the European Union of a group of countries whose average income is way below that of the 15 existing Member States. That will reduce the Community average and may mean that, on account of a purely statistical enrichment, many of the regions in question will cease to qualify for Objective 1 status.

In the case of Madeira and the other outermost regions, cutting investment in (in particular) basic infrastructure (for which there is still a need) and in human resources would mean suddenly halting the current social and economic development process, the basic purpose of which is to bring about sustainable development and much yearned-for economic convergence with the rest of the Union.

Consequently, in spite of the Commission's defence of the per capita GDP criterion as the most appropriate indicator for the distribution of funding, should other prosperity criteria not be used during the coming planning period as a way of safeguarding the unique, specific situation of the outermost regions and even of other regions which may also be affected by the statistical effects of enlargement?

The outermost regions will continue to need Community aid in the future, at least under the existing arrangement (inclusion under Objective 1), which means that all the funds (ERDF, ESF, EAGGF Guidance Section and FIFP) will be used to promote their development, in conjunction with, in particular, support from the Cohesion Fund and other financial instruments. How does the Commission intend to safeguard the specific, unique situation of the outermost regions within the financial framework during the post-2006 period?

Answer given by Mr Barnier on behalf of the Commission

(25 July 2002)

Madeira along with the other outermost regions is covered by one of the six regional priorities identified for areas with severe geographical or natural handicaps in the second Report on Economic and Social Cohesion adopted on 30 January 2001(1). Following the report's adoption, the Commission began wide-ranging discussions with regional and local bodies and associations on the future of cohesion policy and structural policy culminating in the Cohesion Forum on 27 and 28 May 2002. The discussions will continue and proposals will be made when the Commission adopts the third Cohesion Report at the end of 2003.

Discussion is continuing on eligibility for Objective 1 and no decision has been taken at this stage. The first Progress Report on Economic and Social Cohesion(2) reiterated the four possible options for regions whose development is lagging behind, which include maintaining the current threshold of 75 % of Community gross domestic product (GDP).

It should be emphasised that the convergence of the outermost regions' economies vis-à-vis the Union has demonstrated the effectiveness of structural policy since 1989. Madeira has attained particularly convincing results: in 1999 its per capita GDP reached 72 % of the Community average.

In order to provide more material for the discussions, the Commission has launched a study to examine in greater detail the outermost regions' characteristics, situation, needs and potential, and the nature and impact of the Community and national policies implemented there. The study's findings will be presented to the regions concerned, together with specific development proposals. In this connection, the first Progress Report points out that account will have to be taken of the specific needs of the outermost regions identified in Article 299(2) of the EC Treaty. Moreover, the Commission acknowledged the regions' contribution in February 2002.

Lastly, with regard to using new prosperity criteria for the distribution of funding, it should be noted that no specific alternative proposal has so far been presented for determining the eligibility of regions whose development is lagging behind.

(1) COM(2001) 24 final.

(2) COM(2002) 46 final.