Opinion of the Economic and Social Committee on the 'Eighth Annual Report on the Structural Funds 1996'
Date: 1998-05-27
Institutions: European Economic and Social Committee
Subjects: Structural Funds, activity report, economic and social cohesion, implementation of the budget, regional development

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B. As a percentage of total taxation (incl. social security contributions) general government

Registra- Circulation
tion tax

tax

Petrol
tax

Diesel
tax

Insurance
tax

Road
tolls

0,30
2,77
0,00
0,85
0,22
1,63
2,12
0,12
0,00
1,28
0,15
2,45
0,59
0,22
0,00

0,91
0,89
1,00
0,60
0,50
0,45
1,83
0,20
0,16
1,76
0,46
0,32
0,61
0,53
1,69

1,88
1,27
2,77
2,60
2,36
5,48
2,97
3,29
4,79
2,04
2,34
4,31
2,79
2,89
4,26

1,39
0,61
1,29
0,99
1,67
2,42
1,85
1,69
3,40
1,25
0,98
3,22
2,02
0,62
1,90

0,26
0,19
0,40
0,28
0,74
0,00
0,00
0,00
0,00
0,00
0,76
0,00
0,02
0,00
0,02

0,00
0,05
0,00
0,00
0,00
0,00
0,00
0,81
0,00
0,00
1,03
0,67
0,54
0,00
0,00

Total

4,72
5,77
5,46
5,32
5,49
9,98
8,77
6,10
8,35
6,33
5,73
10,96
5,98
4,27
7,88

Belgium
Denmark
Germany
Finland
France
Greece
Ireland
Italy
Luxembourg
Netherlands
Austria
Portugal
Spain
Sweden
UK

Source: Eurostat 1997 and GD XXI.

Opinion of the Economic and Social Committee on the ‘Eighth Annual Report on the
Structural Funds 1996’

(98/C 235/08)

On 25 November 1997 the Commission decided to consult the Economic and Social Committee,
under Article 198 of the Treaty establishing the European Community, on the ‘Eighth Annual
Report on the Structural Funds 1996’.

The Section for Regional Development and Town and Country Planning, which was
responsible for preparing the Committee’s work on the subject, adopted its opinion on 21 April
1998. The rapporteur was Mr Little.

At its 355th plenary session (meeting of 27 May 1998), the Economic and Social Committee
adopted the following opinion by 116 votes and 1 abstention.

1.

Introduction

The European Commission’s Report on the
1.1.
Structural Funds in 1996 is the eighth such annual report
since the last major revision of the regulations governing
the Structural Funds (the 1988 ‘reform’ of the Funds).

1.2.
The report is published in accordance with
Council Regulations (EEC) Nos 2052/88 and 4253/88
both as amended in 1993 and, as required, details their
operations during the year and the progress made
towards achieving their objectives.

1.3.
In November 1996, the Commission presented
its first three-yearly report on Economic and Social
Cohesion (1) as required by Article 130B of the Treaty
of European Union and a précis of this closely-related
report is incorporated in the report under review. This
report on cohesion includes an assessment of
the
contribution made by the Funds to the progress being
made towards economic and social cohesion. The
Economic and Social Committee adopted an opinion (2)
on this report on 23 April 1997.

(1) COM(96) 542 final.
(2) OJ C 206, 7.7.1997, pp. 78-87.

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1.4.
Responding to requests from the European
Council by means of a comprehensive communication
entitled Agenda 2000, the Commission has outlined its
broad perspectives for the development of the Union
and policies beyond the turn of the century and for a
broad financial framework having regard to enlarge-
ment. The document contains, inter alia, outline pro-
posals for further reform of the Structural Funds with
the stated aim of fostering competitive development and
sustainable and job-creating growth throughout the
Union. The Committee adopted an opinion (1) on
30 October 1997 providing a broad initial response to
the Commission’s proposals and will deal in more detail,
in additional opinions currently under preparation, with
the major facets such as the reform of structural policy
in the light of the more detailed proposals (2) published
by the Commission in March 1998.

2. Features of the Structural Funds in 1996

2.1.
The various forms of assistance for the financial
period have now been put into effect in all Member
States with the adoption of the last Single Programming
Documents and Community Initiative programmes in
1996 and the advent of multiannual programming. For
the new Member States, 1996 was a year of key
importance with the allocation of commitments ad-
vancing well.

2.2.
The Objective 2 programmes for 1994-1996 were
wound up although appropriations of ECU 859 million
were carried forward to the next period. Amongst
the preparations that were made for 1997-1999, the
Commission established that the regions eligible for the
latter period should be the same as for 1994-1996 with
very minor changes. The overall population covered by
objective 2 is still 16,4 %.

continued

The Commission

2.3.
to monitor
implementation, supporting preparations for interim
evaluation. It also launched a series of thematic evalu-
ations of the impact of the Structural Funds in a number
of key areas such as research and development, small
and medium-sized enterprises, the environment and
equal opportunities. Work to utilize the outcomes of the
evaluations was expected to commence in late 1997. In
conjunction with the Member States, new guidelines
for sound and efficient management were introduced.
Weaknesses and irregularities in almost all Member
States were again revealed.

2.4.
The four principles central to the 1988 reform
were kept under scrutiny. In the view of the Commission,

there was an improvement in the way partnership took
shape and substantial progress was made in obtaining
verification that the principle of additionality was
honoured.

2.5.
Clear progress was made in making up the
backlog in financial activity and execution of the
Community budget was virtually 100 % for 1996. ECU
26,1 billion was committed by way of appropriations
and payments amounted to ECU 22,4 billion.

2.6.
The employment situation remained a major
cause for concern during 1996 and the Commission
sought to ensure that there was consistency between the
measures part-financed by the Structural Funds and the
strategy of the EU to give priority to tackling employment
problems. Accordingly, job creation was established
as first priority within the guidelines issued by the
Commission to Member States for the preparation of
Objective 2 programmes for 1997-1999. For the same
reason, the Commission launched an initiative to pro-
mote territorial pacts for employment with part-
financing from the Structural Funds.

2.7.
The Commission also allocated the financial
reserve of almost ECU 1,7 billion which had been set up
at the time of the initial allocation for Community
Initiatives over the 1994-99 period, taking into account
a number of priorities: combating unemployment, equal
opportunities and combating exclusion, the environment
and the territorial dimension of structural policies.

3. General Comments

3.1.
The report is both comprehensive and complex
and it constitutes, in the main, a historical record and a
reference source. It would be neither practical nor
appropriate for the Committee to comment on all facets
of the report.

3.2.
In this opinion, the Committee concentrates on
major issues arising in 1996, on issues which have been
raised previously but are not yet resolved and on the
merits of the Eighth Annual Report itself. As the
Objective 2 programmes for 1997-1999 are the subject
of a parallel opinion, to avoid duplication, no specific
comments are made on the preparations made for these
programmes in 1996 and to which reference is made in
the report under review. Similarly, no specific comments
are made here on the detailed proposals for reform of
the Structural Funds regulations as these proposals will
be the subject of one or more separate opinions to be
prepared and adopted over the next few months.

(1) OJ C 19, 21.1.1998, pp. 111-115.
(2) COM(98) 131 final.

The Committee notes that the Commission’s
3.3.
report for 1996 is largely structured as for the previous

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year. One important change is the bringing together of
all the information on the assistance from the funds for
each country so as to provide individual overall views
of the structural programmes implemented. The inno-
vation of last year of dealing with one subject horizon-
tally throughout the report has been retained, the topic
this time being support for research and technological
innovation.

3.4.
The report falls into two main parts. The first
takes a general look at what was achieved in 1996
and comprises four chapters (implementation of the
Structural Funds in 1996, budget implementation, insti-
tutional matters connected with the Structural Funds,
evaluation). The second looks in detail at the implemen-
tation of the Structural Funds and comprises six chapters:
the first sets out the programmes and achievements in
each Member State and the other five consist of financial
tables giving details of financial
implementation in
1996, implementation from 1994 to 1996, the regional
breakdown of financial implementation, major projects,
and ERDF and ESF pilot projects.

3.5.
The Committee welcomes both the content
and structure of the 1996 report and commends the
Commission for its diligence in the production of this
extensive document of some 350 pages and for meeting
the November deadline for its publication. However,
the time-cycle for production reduces the value of the
report and, accordingly, the Committee supports the
Commission’s recently-stated intention to bring forward
the date of publication in future years.

Communication on Community Structural Assistance
and Employment (1) on which the Economic and Social
Committee was not asked to give an opinion and were
also consolidated within its Communication ‘Action for
Employment in Europe — A Confidence Pact’ (2).

Under the initiative approved at the July 1996
4.1.3.
European Council to promote Territorial Pacts for
Employment (initially on a pilot basis), specific guide-
lines have been adopted for the ‘stronger partnership’
deemed necessary for the project. The Committee has
already expressed its support for the pacts and, on
30 October 1997, it approved an information report to
help publicize them.

4.1.4.
The Committee considers that, in due course,
the Territorial Pacts should provide useful experience
of such a stronger partnership. This will have relevance
for the general operations of the Structural Funds, but,
because of delays in implementing the pilot pacts, such
experience may not be available and assessable before
the framework and regulations for the next period are
put in place. The report gives no further indication of
how the Commission proposes to take forward its
thinking on the future development of partnership.
However, the Committee is aware that, in 1997, the
Commission set in motion a thematic evaluation of
partnership, the outcome of which it awaits with interest.

4.1.5.
A redefinition of partnership has now been
proposed by the Commission as part of the reform of
the Structural Funds.

4. Specific comments

4.2. Programming

4.1. Partnership

4.1.1.
The Economic and Social Committee has long
been concerned with the setting up of satisfactory
‘partnerships’ whereby consultation will take place
between the Commission, Member States and other
relevant bodies regarding the preparation, financing and
evaluation of Structural Funds operations. The new
partnership arrangements introduced in 1994 were
supported in principle by the Committee and it now
acknowledges the progress that has been made by 1996
in the implementation of these arrangements.

4.2.1.
The delays which occurred during 1995 and
1996 in launching and implementing programmes have
been largely caught up in 1996. Whilst that achievement
is to be welcomed, the Committee remains concerned
that a gap of probably some eighteen months on average
arose between the winding-down of programmes for the
preceding period and the setting-up of programmes for
the 1994-1999 period. The vast number of assistance
measures (now 492 for the objectives alone!) creates an
enormous burden in terms of preparation, appraisal and
approval and one that is apparently irreconcilable with
the satisfactory closing of that gap.

4.2.2.
The programme for Objective 2 regions will
suffer twice from such delays because of the sub-division

4.1.2.
The report refers to an internal Commission
document in which preliminary proposals were made
with a view to further improvement of the partnership
concept being introduced for the period after 1999. Those
proposals were taken forward within a Commission

(1) COM(96) 109 final, March 1996.
(2) CSE(96) 1 final, June 1996.

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of the 1994-1999 period. Before the start of that period
the Committee expressed the view, in its opinions (1) on
the Amendment of the Structural Funds Regulations,
that the period should not be sub-divided for Objective
2. In the event, negligible changes were made to the
eligible regions and, if the Committee’s recommendation
had been adopted, the additional delays and administrat-
ive burdens could have been avoided.

4.2.3.
The Committee continues to support simplifi-
cation of programming procedures and, indeed, in its
recent opinion on the Report on Economic and Social
Cohesion it put forward specific proposals for rational-
ization and reduction of the numbers of objectives,
funds and initiatives.

4.2.4.
The Committee recommends that the timetable
for preparation, appraisal and approval be brought
forward in the cycle so that the lead time between the
start of a new financial period and the launch of
programmes is shortened considerably and calls on the
Commission to issue comprehensive and clear guidelines
as early as possible in the cycle. The implementation of
such a timetable for the financial period 2000-2007
requires appropriate political decisions to be taken by
the Council and the European Parliament early in 1999.

4.3. Structural Funds and other Community policies

4.3.1.
Regional development is not determined solely
by the regional policies of the Community and the
Member States. Similarly, EU structural policies must
operate within the overall economic environment and
are subject to the effects of other policies.

4.3.2.
The need for optimum consistency between
policies has been stressed regularly by the Committee and
it has frequently called for analyses of the relationship
between the Structural Funds and other Community
policies and on the impact they have on each other.

4.3.3.
The Cohesion Report, to which reference is
made in point 1.3 above, provides a perspective of the
impact of all EU and national policies on economic and
social cohesion, the fundamental aim of the Structural
Funds. The Committee has warmly welcomed the report
and, in its opinion thereon it stated that ‘The critical
value of the first Cohesion Report is that it places the
funds in the context of a wider range of EU policies’ (2).

(1) OJ C 201, 26.7.1993, pp. 52-58.
(2) OJ C 206, 7.7.1997, pp. 78-87, paragraph 1.10 of the

opinion.

4.3.4. No matter the efforts made to take account of
cohesion, it is inevitable that the opportunities and
benefits of non-structural policies will have uneven
regional consequences as does the whole process of
economic integration. The recognition of countervailing
pressures arising from non-structural policies is part of
the rationale for the operation of the Structural Funds
and these need to be given proper cognisance in the
targeting of funds. In chapter II D of the Eighth
Annual Report, the Commission places emphasis on
the influence of the Structural Funds in assisting the
objectives of other policies and merely makes some
those policies on
references to positive effects of
cohesion. Whilst the Committee accepts that it is not
appropriate to refer in detail to those countervailing
pressures in annual reports (in contrast to the Cohesion
Report), it considers that their existence should not be
ignored.

4.3.5.
The Committee regrets that the heading of
chapter II D is misleading as the term ‘complementarity’
implies that EU policies are complementary without
qualification (things or matters cannot be complemen-
tary to a degree). The term used is an unfortunate
example of bureaucratic jargon and is, at best, unclear.
It would be more informative to use ‘Compatibility with
other Community policies’ as the heading of the chapter.

5. Research and technological innovation

The Committee welcomes the horizontal analysis of the
operations undertaken by the funds for the technological
development of the regions and supports the emphasis
given to innovative products and services arising from
applied research. The report underlines the EU-wide
disparities in RTD indicators such as RTD expenditure
and employment and access to telecommunications. The
increasing emphasis being given to RTD measures under
the Structural Funds in the 1994-1999 programmes,
particularly in Objective 1 regions, is a welcome develop-
ment. Also notable is the growing sophistication of
technological measures (e.g. information and advisory
services, technical education and training, the exploi-
tation of telecommunications infrastructure, technology
transfer mechanisms), the growing involvement of the
private sector and the investment being made in com-
innovation/technology transfer
plementary regional
strategies to promote a more analytical and strategic

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approach to RTD issues. It will be important for future
reports and evaluation commissioned by the European
Commission to assess the impact of these trends. The

Committee notes with interest that a separate report on
RTD and the Structural Funds is to be issued by the
Commission early in 1998.

Brussels, 27 May 1998.

The President

of the Economic and Social Committee

Tom JENKINS

Opinion of the Economic and Social Committee on the ‘Communication from the Commission
on the new regional programmes 1997-1999 under Objective 2 of the Community’s Structural
Policies — focusing on job creation’

(98/C 235/09)

On 17 November 1997 the Commission decided to consult the Economic and Social Committee,
under Article 198 of the Treaty establishing the European Community, on the above-mentioned
communication.

The Section for Regional Development and Town and Country Planning, which was
responsible for preparing the Committee’s work on the subject, adopted its opinion on 21 April
1998. The rapporteur was Mr Masucci.

At its 355th plenary session (meeting of 27 May 1998), the Economic and Social Committee
adopted the following opinion with 114 votes in favour and one abstention.

1.

Introduction

In November 1997 the Commission presented a
1.1.
communication setting out
the new regional pro-
grammes for declining industrial areas (Objective 2)
during the second programming period, which runs to
the end of 1999.

The communication is based on an examination of 65
new Single Programming Documents (SPDs) and one
Community Support Framework (CSF) for Spain.

The communication does not consider the SPDs for
Austria and Sweden, as these countries opted for a
five-year programming period (1).

1.2.
The communication summarizes the anticipated
impact on economic development, and especially on
employment.

(1) A summary of the programmes for these two countries is
contained in the Commission communication on the
implementation of EU regional policies in Austria, Finland
and Sweden (COM(96) 316 final, 3.7.1996).

According to information from the Member States,
these programmes should create or maintain around
880 000 jobs, 90 % of which (801 000) are concentrated
in the UK, France, Germany, Spain and Italy.

The planned measures fall into four main catego-

1.3.
ries:

— support for the growth and competitiveness of
industry and businesses, especially SMEs (47,4 % of
expenditure);

— training and reskilling programmes, in particular to
familiarize workers with new technologies (33,8 %);

— regeneration and improvement of run-down indus-

trial and urban areas (12,3 %);

— environmental protection and promotion of clean

technologies and green tourism (5,2 %).