Special Report No 16/98 on the implementation of appropriations for structural operations for the programming period 1994-1999, together with the Commission's replies (submitted pursuant to Article 188c(4)(2) of the EC Treaty)
Date: 1998-09-23
Institutions: European Court of Auditors
Subjects: Structural Funds, budgetary procedure, implementation of the budget, management, project management, structural expenditure

C  347/48

EN

Official  Journal  of  the  European  Communities

16.11.98

SPECIAL  REPORT  No  16/98

on  the  implementation  of  appropriations  for  structural  operations  for  the  programming  period
1994-1999,  together  with  the  Commission’s  replies

(submitted  pursuant  to  Article  188c(4)(2)  of  the  EC  Treaty)

(98/C  347/02)

TABLE  OF  CONTENTS

Paragraph
reference

Page

1.  Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1.1

2.  Summary  of  main  observations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2.1 — 2.9

3.  Financial  programming  and  budgetary  implementation  of  the  structural
operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3.1 — 3.12

4.  Existing  information  on  the  implementation  of  structural  operations . . . . . .

4.1 — 4.7

5.  Budgetary  procedures  for  structural  operations 

. . . . . . . . . . . . . . . . . . . . . . .

5.1 — 5.9

6.  Delays  in  the  utilisation  of  Community  appropriations  at  the  level  of  certain
individual  forms  of  intervention . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.1 — 6.53

General observations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.1 — 6.13

Programming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.14 — 6.22

Financial channels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.23 — 6.33

Mobilisation  of  resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.34 — 6.44

Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.45 — 6.53

7.  Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7.1 — 7.8

TABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The  Commission’s  replies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

49

49

50

51

52

54

54

56

57

58

60

61

63

83

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1.  INTRODUCTION

implementation  of
1.1. This  report  deals  with  the 
Community  appropriations  for  structural  operations  in
the  1994-1999  programming  period  during  the  financial
years  1994  to  1997.  It  examines  in  particular  the
utilisation  of  appropriations  in  relation  to  the  overall
funding  granted  to  structural  operations  and  to  the
Structural  Funds  for  the  period  1994-1999,  in  keeping
with  the  decision  of  the  Edinburgh  European  Council  of
11 and 12 December 1992 and the provisions of the Act
of  Accession  for  the  three  new  Member  States.  The
consequences  of  this  implementation  of  appropriations
on  future  financing  are  analysed  in  relation  to  the
financial perspective. The reasons behind the under-use of
appropriations  and  the  delays  in  the  use  of  the  overall
financial  allocations  have  been  analysed  with  the  aid  of
questionnaires sent to the Member States and on-the-spot
visits.

2.  SUMMARY  OF  MAIN  OBSERVATIONS

Commission’s  main  concerns  every  year  is  to  achieve  the
planned  levels  of  commitment.  The  techniques  that  have
been  developed  to  endeavour  to  achieve  this  aim  require
great  effort  on  the  part  of  the  Commission  and  the
Member  States,  especially  as  regards  the  amendments  to
financial  plans.  These  plans  are  drawn  up  and  amended
in  order  to  serve  as  a  basis  for  making  the  necessary
commitments  (see  paragraphs  3.11-3.12).

2.5. The  lack  of  reliable,  up-to-date  information  on  the
physical  and  financial  implementation  of  the  structural
operations  at  all  levels  of  management  (Community,
national  and  regional)  makes  it  very  difficult  to  monitor
these  measures.  Feedback  on  the  actual  state  of  progress
of  the  operations  is  very  slow.  Certain  budgetary  and
accounting  practices  and  a  complex  and  badly  managed
indexing  system  make  it  even  more  difficult  to  obtain  an
accurate  picture  of  the  situation.  The  attempts  at  setting
up  joint  databases  have  met  with  failure.  Consequently,
the  data  which  the  Commission  presents  in  its  revenue
and 
sheet  as
commitments  not  included  in  the  balance  sheet  are  not
complete  (see  paragraphs  4.1-4.21).

expenditure  account  and  balance 

for 

the  programming 

2.1. Overall,  at  31  December  1997,  the  implementation
of 
the  structural  operations
achieved  a  level  that  was  close  to  the  initial  estimates,  in
spite  of  the  delays  that  had  been  noted  at  the  beginning
of  the  period.  Nevertheless,  significant  disparities  are
apparent per field and per Member State (see paragraphs
3.1-3.4).

In 1994 and 1995 there was found to be under-use
2.2.
of  commitment  and  payment  appropriations.  In  1996
and  1997,  by  contrast,  the  rate  of  implementation  for
appropriations under the main headings, in particular the
ERDF,  the  ESF  and  the  Cohesion  Fund,  was  almost
100 %.  For  the  Community  initiatives,  however,  the  rate
remained  low.  In  1997,  the  Commission  was  unable,
because  of  the  lack  of  payment  appropriations,  to  act
upon  payment  claims  totalling  around  1  500  Mio  ECU
(see  paragraphs  3.5-3.7).

for 

In  order 

the  delays 

to  make  up 

2.3.
in
implementation of the commitment appropriations of the
Structural  Funds  (SFs),  the  1999  budget  will  need  to
in  addition  to  the
provide  for  3  171  Mio  ECU 
appropriations  originally  planned 
financial
perspective,  i.e.  about  2 %  of  the  total  appropriations  of
the  SFs.  The 
cases  of  under-use  of  payment
appropriations  that  have  been  noted,  particularly  at  the
beginning  of  the  period,  have  led  to  a  use  of  own
resources  that  was  unnecessary.  Part  of  the  surpluses
from  previous  financial  years  can  be  ascribed  to  this  (see
paragraphs  3.8-3.10).

the 

in 

some  headings
2.6. The  cases  of  under-use  on 
concerning  structural  operations  and 
lack  of
appropriations  for  others,  coupled  with  the  scale  of  the
transfers  of  appropriations  carried  out  within  these
budget  headings,  highlight 
reliable
expenditure  programming  and  the  shortcomings  of  the
budgetary 
(see  paragraphs
5.1-5.10).

forecasting  procedures 

lack  of 

the 

the 

2.7. The poor rate of utilisation of appropriations at the
beginning of the period could have been foreseen, bearing
in  mind  the  delays  in  the  adoption  of  the  regulatory
framework  —  the  Community  Support  Frameworks
(CSFs) and the single programming documents (SPDs) —
and  the  forms  of  intervention,  and  the  periods  of  time
laid  down 
(see
paragraphs  6.4-6.7).

the  operations 

implementing 

for 

2.8. An  analysis  of  the  forms  of  intervention  that  have
the  lowest  levels  of  use  of  appropriations  shows  that  the
delays  in  implementation  relating  to  these  are  causally
linked  in  particular  to  one  or  more  of  the  facts  or
situations  described  below:

—  the  differences  between  the  Community  budgetary
and  financial  implementation  procedures  and  the
national  ones  (6.8,  6.10);

—  cases  where  the  application  of  basic  aspects  of
eligibility,  such  as  the  notion  of  legal  and  financial
commitment,  gives  rise  to  some  uncertainty  (6.9);

2.4. The  objectives  for  structural  expenditure  set  by  the
financial  perspective  are  reflected  in  the  Community
budget  in  terms  of  annual  commitments.  One  of  the

—  the  difficulties  in  applying  the  integrated  approach

(6.11,  6.12,  6.15,  6.16,  6.19,  6.20);

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—  weaknesses  in  the  financial  and  physical  monitoring,
the  Monitoring

the  malfunctioning 

of 

and 
Committees  (6.13,  6.29);

—  lapses  in  the  coordination  (6.17,  6.18);

—  overlapping  of  the  programming  periods  (6.21);

—  the  length  of  time  taken  for  the  presentation  and

handling  of  the  payment  claims  (6.32,  6.33);

—  the optimism of the financing plans, the weak ex ante
evaluations  of  the  operations,  particularly  as  regards
lengthiness  of  the
private 
administrative 
6.42,
(6.34-6.39, 
6.50-6.52);

investments,  and  the 

procedures 

—  fluctuations  in  the  exchange  rates  (6.43-6.44);

—  the  fact  that  some  beneficiaries  are  not  familiar  with

the  eligibility  rules  (6.45);

—  exceptional  cirsumstances  (6.46,  6.53).

to 

the 

framework  of 

2.9. Bearing  in  mind  the  limited  resources  that  the
Commission  has  at  its  disposal  and  the  large  number  of
programmes,  the  Court  finds  that  the  Commission  has
devoted  considerable  effort 
the  programming,
management  and  evaluation.  One  it  has  simplified  the
eligibility  criteria  and  clearly  divided  up  responsibilities
within 
the
Commission  should  give  priority  to  applying  genuine
management  by  objective  and  by  programme  —  a  basic
concept  of  the  reform  —  at  all  levels  (programming,
evaluation,  organisation,  monitoring,  checks).  Attention
should  also  be  drawn  to  the  efforts  made  by  many
administrators 
individual  Member  States.
Nevertheless,  the  national  systems  need  strengthening  at
the  levels  mentioned.  The  way  some  of  the  Monitoring
Committees  are  run  should  also  be  improved.

the  partnership, 

the 

in 

3.  FINANCIAL  PROGRAMMING  AND  BUDGETARY
STRUCTURAL
OF 

THE 

IMPLEMENTATION 
OPERATIONS

In  1992,  the  Council  made  provision  for  a  sum  of
3.1.
141  471  Mio  ECU  for  commitment  under  the  Structural
Funds  for  the  period  1994-1999,  to  which  was  added
4 747  Mio  ECU  in  1995  for  the  three  new  Member
States. The annual distribution of these amounts was also
planned  (see  Table  1).  The  complex  procedure  for
allocating these resources by objective, Member State and
Community  initiative  (CI)  has  not  always  been  based  on
the  Community
objective 

criteria,  mainly  where 

initiatives  are  concerned,  for  which  the  procedure  has,
moreover,  been  lengthy (1).

3.2. Out  of  a  total  of  137 634,5  Mio  ECU  at  current
prices  that  was  provided  for  under  the  CSFs  of  the  12
Member  States  of  that  time  for  the  entire  period
1994-1999,  83 488,2  Mio  ECU  was  committed  between
1994  and  1997,  i.e.  60,7 %.  In  relation  to  the  estimates
for the first four years (85 411,4 Mio ECU), this is a rate
of 97,7 %. The volume of payments that have been made
is  61 995,3  Mio  ECU,  i.e.  72,6 %  of  the  planned
commitments  (see  Table  2).  This  may  be  regarded  as
reasonable,  in  view  of  the  start-up  difficulties  and  the
planned staggering of the payments. An additional period
of  two  years  is  usually  granted  for  making  the  payments
to  the  beneficiaries,  and  the  final  implementation  reports
have to be presented within six months of the end of this
period.

3.3. A  sum  of  2 285,9  Mio  ECU  was  committed  under
the  CSFs  of  the  three  new  Member  States  for  the  period
1995-1999,  which  represents  89,8 %  of  the  amounts
programmed  for  the  first  three  years  of  that  period.
Payments  totalled  1 636  Mio  ECU,  i.e.  64,3 %  of  the
commitment  estimates  (see  Table  3).  These  lower  rates
can be attributed to the fact that these States have had to
set  up  procedures  for  managing  the  SFs.

3.4. The degree of progress made in the programming in
relation  to  the  initial  estimates  differs  from  one  Member
State to another. The rate of commitment varies between
112,6 %  and  71,2 %.  For  payments,  the  rates  vary
between  90,7 %  and  47,4 %.  In  terms  of  objectives,
Objective  1  (O1)  has  the  best  performance  (101,3 %  in
commitments)  whereas  Objectives  5(a)  (fisheries  part)
(75,4 %)  and  5(b)  (75,2 %)  are  lagging  behind.

3.5. Out  of  an  amount  of  14  471,1  Mio  ECU
programmed under the CIs for the period 1994-1999 and
9 078,6  Mio  ECU  for  the  first  four  years,  commitments
amounted  to  7 661,5  Mio  ECU,  i.e.  84,4 %  of  the  total
planned  for  these  years,  and  payments  amounted  to
4 165,3  Mio  ECU,  i.e.  45,9 %  (see  Table  4).  The  delays
in  the  adoption  of  the  guidelines  and  the  difficulties
encountered  in  drawing  up  and  adopting  the  numerous
programmes  concerned  are  the  cause  of  the  low  rates  of
implementation  that  have  been  noted,  especially  at  the
beginning  of  the  period.  The  Court  has  already  drawn

(1)  The  corresponding  data  are  included  in  a  set  of  annexes  to
this  report  available  on  request  from  the  European  Court  of
Auditors  (see  Table  10).

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attention to the shortcomings in the management of these
CIs  in  its  previous  annual  reports (2).

implementation  for  commitment
3.6. The  rates  of 
appropriations  varied  between  91,1 %  in  1994  and
98,4 % 
in  1996.  For  payment  appropriations,  the
corresponding  rates  rose  from  72,5 %  in  1994  and
80,3 %  in  1995  to  98,6 %  in  1997.  The  low  rate  of
implementation  for  payment  appropriations  in  1994  and
1995  led  to  a  very  large  volume  of  these  appropriations
being cancelled (5 330 Mio ECU in 1994 and 4 425 Mio
ECU  in  1995)  (see  Table  5).  In  1997,  however,  the
shortfall  in  appropriations  on  some  headings,  especially
the ESF and the ERDF, meant that it was not possible to
make  payments  totalling  some  1 500  Mio  ECU.

in 

the  disparities 

table  highlights 

the
3.7. This 
implementation  of  various  structural  operations.  For
example,  the  ERDF  and  the  Cohesion  Fund  still  show  a
rate  of  utilisation  of  commitment  appropriations  of
nearly  100 %,  whereas  the  CIs  show  mediocre  results,
especially 
in  1994  and  1997  (12,9 %  and  61,4 %
respectively).  For  the  payment  appropriations  of  the
Cohesion  Fund,  the  rate  of  utilisation  was  52,5 %  in
1994  but  achieved  almost  100 %  in  1995,  1996  and
1997.  The  ERDF  and  the  ESF  used  up  virtually  all  their
appropriations  in  1996  and  1997  whereas  in  1994  and
1995, together with the CIs, they were the cause of most
of  the  cancellations  of  appropriations.

3.8. The  financial  perspective  was  adjusted  to  the
implementation  conditions  of  the  structural  operations.
These  adaptations,  not  taking  into  account  any  cases  of
under-use  that  may  arise  in  1998,  have  led  to  about
3 171 Mio ECU and 118 Mio ECU in appropriations for
commitments  being  carried  forward  to  the  financial  year
1999  in  respect  of  the  SFs  and  the  Cohesion  Fund
respectively. For appropriations for payments, the overall
effects  are  in  the  region  of  1 405  Mio  ECU  for  the
financial  year  1999  (see  Tables  6  and  7).  In  view  of  the
ceilings  fixed  under  the  system  of  own  resources  and  the
Interinstitutional  Agreement  on  budgetary  discipline,  the
requisite  appropriations  could  be  entered  in  the  1999
budget.

3.9. For  all  the  SF  objectives,  the  proportion  of
payments  in  relation  to  commitments  is  74,2 %  whereas
for the CIs it is only 54,4 %. This proportion varies from
one  Member  State  to  another,  ranging  for  all  the  SFs
from  88,4 %  for  Ireland  to  57,4 %  for  Italy (1).

comparative  analysis  of 

3.10. A 
the  budgetary
implementation  with  the  annual  estimates  shows  a  lack
of  commitments  and  payments  in  1994  for  certain

countries  and  objectives  which  stems  from  the  fact  that
no  aid  measure  had  yet  been  adopted.  This  was  the  case
in  particular  for  Objective  2  (O2)  in  Spain,  the  only
country  which  did  not  opt  for  the  SPD  formula,  or  for
Objective  5(b)  (O5b)  in  Belgium.  The  delays  that  were
found  at  the  beginning  of  the  period  were  made  up  in
1996  and  1997.  Thus,  for  example,  the  cumulated
payments in relation to the estimates rose from 51,7 % in
1994  to  77 %  in  1997  for  O1,  from  44,7 %  to  65,6 %
for  O2  and  from  34,5 %  to  55 %  for  O5b.  As  regards
Italy  and  for  O1,  this  percentage  rose  from  18,6 %  to
55,5 % (1).

3.11. For  all  the  O2  aid  measures 
in  the  period
1994-1996, the financial plans drawn up under the initial
programming  had  to  be  rescheduled,  which  meant  that
they  were  concentrated  on  the  final  year  (see  Table  8)
and  that  large  amounts  from  the  Structural  Funds (1)
were  transferred  to  the  period  1997-1999.

3.12. The  Community’s  rules  for  financial  management
were  not  intended  to  establish  a  precise,  direct  link
between  commitments  and  payments  on  the  one  hand
and the progress of aid measures on the other, whether at
the  level  of  the  administrators,  the  final  beneficiaries  or
the ultimate beneficiaries (3). On the one hand, where the
Community  aid  that  is  granted  does  not  exceed  40  Mio
ECU,  the  commitment  for  the  whole  period  can  take
place  at  the  time  the  decision  is  adopted.  On  the  other
hand,  the  link  between  the  expenditure  incurred  and  the
Community  appropriations  disbursed  is  more  and  more
tenuous.  The  rescheduling  of  the  financial  plans  leads  to
new  payments  being  made  despite  a  low  rate  of  progress
in the aid measures. For some activities, the commitments
and  even  the  payments  may  temporarily  be  higher  than
the  estimates,  because  the  corresponding  adjustments  are
not  made  until  the  first  financial  operation  after  an
amendment.  Lastly,  the  considerable  delays 
in  the
circulating  of  financial  data  further  reduce  their  value  in
terms of reflecting the true situation of the aid measures.
As  for  the  situation  at  31  December  1997  regarding
payments  made  by  national,  regional  and  local  bodies  to
the  final  beneficiaries,  no  exact  information  can  be
provided  because  of  the  shortcomings  and  delays  in  the
systems  for  monitoring  data.

4.  EXISTING 

INFORMATION 

ON 

THE

IMPLEMENTATION  OF  STRUCTURAL  OPERATIONS

4.1. The  task  of  analysing  structural  operations 
is
hampered by shortcomings in the reliability and updating

(2)  See  the  Annual  Report  of  the  European  Court  of  Auditors
concerning  the  financial  year  1995  —  SME,  Leader  and
Adapt;  Annual  Report  of  the  European  Court  of  Auditors
concerning  the  financial  year  1994  —  Interreg.

(3)  Those  involved  here  are,  for  example,  project  managers  for
operations  coming  under  final  beneficiaries  or  companies
receiving  support  under  aid  schemes.

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of  the  information  needed  for  this  purpose.  These
weaknesses,  which  exist  at  various  levels  (Community,
national  and  regional),  concern  in  particular  information
about how the programming is progressing and details of
the  implementation  of  aid  measures  in  the  field.  There  is
no  overview  of  the  whole  situation  regarding  the
programming  of  structural  operations 
for  a  given
period.

is 

in 

fact 

to  show, 

the  Court (4), 

4.2. As  requested  by 
in  1996 
the
its  revenue  and
Commission  started 
expenditure  account  and  balance  sheet, 
information
concerning  the  multiannual  obligations  connected  with
structural  operations  as  off-balance-sheet  commitments.
The figures presented for the financial year 1997 are still
incomplete (5).  The 
the  Commission
departments  draw  up  a 
the
setting  out 
off-balance-sheet  commitments  on  the  basis  of  the  SF
allocation  in  accordance  with  the  financial  perspective,
deducting  the  cumulated  commitments.  This  procedure
does  not  make  it  possible  to  distinguish  between,  on  the
one  hand,  the  amounts  corresponding  to  existing  legal
obligations  arising  from  decisions  that  have  already  been
made, and, on the other, the amounts that still have to be
allocated.  Information  on  the  Cohesion  Fund  was
presented,  for  the  first  time,  in  1998.

that 
table 

regard 

4.3. The  Commission’s  practice  with 
to
commitments by annual tranches varies depending on the
department  concerned.  These  practices  consist  in  making
no  adjustment  to  the  commitments  after  reprogramming
and  in  charging  payments  to  the  oldest  commitments (6).
They  make  monitoring  difficult  and  lead  to  a  situation
where  the  aid  measures  are  artificially  fragmented  into
annual  tranches  and  then  this  temporal  link  is  forgotten
when  they  are  being  implemented.

In its Opinion No 4/97 (7), the Court recommended
4.4.
that  the  practice  of  committing  structural  measures  by
annual  instalments  be  abandoned,  as  it  ‘is  an  anomaly
and  an  oversight  of  the  fact  that,  for  multiannual
operations  to  which  differentiated  appropriations  are
allocated,  it  is  the  payment  appropriations  that  must
ensure  conformity  with  budgetary  annuality  and  the
regularity  of  the  amounts  spent  from  one  financial  year
to  another’.

(4)  See  the  Annual  Report  of  the  Court  of  Auditors  concerning

the  financial  year  1994,  paragraphs  5.7  and  5.113.

(5)  See  the  Annual  Report  of  the  Court  of  Auditors  concerning
the  financial  year  1997,  Chapter  8  relating  to  the  Statement
of  Assurance,  paragraph  8.58.

(6)  See  the  Annual  Report  of  the  Court  of  Auditors  concerning
the  financial  year  1996,  Chapter  21,  paragraph  21.4.  —
Report  in  support  of  the  1995  DAS,  Volume  I,  paragraphs
3.34-3.35.

(7)  Opinion  No  4/97  of  the  European  Court  of  Auditors  on  a
proposal  for  a  Council  Regulation  (Euratom,  ECSC,  EC)
amending  the  Financial  Regulation  of  21  December  1997
applicable 
the  European
the  general  budget  of 
Communities,  paragraph  2.16  of  the  Annex.

to 

the  objectives 

thus  defined  are  de 

4.5. The  practice  of  making  commitments  by  tranche,
provided  for  in  the  regulations  governing  the  Structural
Funds,  is  a  deliberate  exception  to  the  general  provisions
laid  down  in  the  Financial  Regulation.  This  commitment
by  tranche  maintains  the  present  paradoxical  situation
whereby  the  expenditure  objective  is  fixed  in  terms  of
annual  commitments  of  the  Community  budget.  In
reality, 
facto
undermined right from the beginning of the period, when
the programmes are adopted, as this adoption defines the
total  cost  of  the  legal  obligations  entered  into  by  the
Community,  with  this  cost  itself  being  pre-defined  under
the  financial  perspective  and  the  framework  Regulation.
The  role  played  by  the  administrating  departments  thus
consists  in  putting  this  situation  on  a  formal  footing  by
making  the  budgetary  commitment,  which  then  involves
no  more 
than  merely  making  accounting  entries.
However,  the  number  of  operations,  the  complexity  of
the  calculations  required  in  order  to  put  the  operations
on  a  yearly  basis,  and  the  cumbersome  procedures  for
amending  the  financial  plans  for  the  measures  all  mean
that  the  Commission  departments  concerned  and  the
Member  States  have  to  devote  a  considerable  portion  of
their  resources  to  this.

4.6. These  operations  are  carried  out  throughout  the
duration  of  the  programmes,  but  they  assume  greater
importance at the end of each programming period when
the majority of the financial plans have to be rescheduled.
This  situation,  which  was  observed  for  the  period
1994-1996 of Objective 2, will recur in 1999, for the sole
purpose of being able to commit all the planned amounts
of  overall  funding.

4.7.
It is difficult to obtain an overall picture of how the
structural  operations  are  being  managed  by  the  various
Commission  departments  because  this  management  is  so
compartmentalised.  Databases  have  been  set  up  in  each
of  the  departments,  but  no  provision  has  been  made  for
linking  them  up  so  that  the  data  can  be  cross-checked
and  compared.  Their  main  purpose  is  to  enable  the
budgetary  implementation  of  the  portion  of  the  aid
measures  managed  in  each  department  to  be  monitored;
they  are  of  only  very  limited  use  for  overall  monitoring.
The  ARINCO  database  has  the  advantage  of  being
common  to  all  the  SFs,  but,  because  of  the  lack  of  basic
data,  the  poor  quality  of  the  data  available  and  the
failure  to  update  them  regularly,  this  instrument  is
inoperative.

5.  BUDGETARY 
OPERATIONS

PROCEDURES 

FOR 

STRUCTURAL

the  detailed
5.1. An  analysis  has  been  made  of 
budgetary  implementation  of  commitment  and  payment
appropriations (1).  This  has  taken  account  of  not  only
transfers  in  the  strict  sense  but  also  ‘reassignments’  of
appropriations  within  a  budget  item.  In  the  case  of  the

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CIs,  a  single  budget  item  was  created  for  each  of  these
initiatives  or  their  different  aspects.  However,  the  aid  is
granted  under  the  ERDF,  the  ESF,  the  EAGGF-Guidance
or  the  FIFG  without  this  fact  being  reflected  in  the
budget.  When  the  items  concerned  by  the  CIs  are
implemented,  the  internal  allocations  are  made  by  the
authorising  officer  responsible  for  the  management  of
each Fund. The ‘reassignments’ consist in reallocating the
appropriations  available  under  the  CIs  between  the
different  SFs.

implementation rates were only 12,9 % for commitments
and  41,2 %  for  payments.  The  need  to  budgetise  these
amounts,  which  it  was  obvious  beforehand  could  not  be
mobilised, was justified by the Commission as a necessary
to
stage 
subsequent  years,  by  way  of  interpretation  of  paragraph
10.2  of  the  Interinstitutional  Agreement  on  budgetary
discipline  and  improvement  of  the  budgetary  procedure.

transfer  unused  allocations 

in  order 

to 

5.2. The  scale  of  the  transfers  and  ‘reassignments’  of
appropriations,  which  involve  several  thousand  million
ecu  each  year  in  both  commitments  and  payments  and
which  concern  virtually  all  the  items,  is  evidence  of  the
lack  of  rigour  in  the  budgetary  estimates.  Cases  of
considerable  under-use  of  appropriations  were  offset  by
overruns  on  appropriations  elsewhere.  By  way  of
example, 
the  ERDF  O2  payment
appropriations,  there  was  a  negative  transfer  of  584,5
Mio  ECU  in  1996  (33 %)  and  a  positive  transfer  of
874,6  Mio  ECU  in  1997  (48 %).

regards 

as 

situation.  The 

5.3. There  are  several  circumstances  that  can  explain
commitment
this 
appropriations  globally  adopt  the  annual  objectives  laid
down  in  the  financial  perspective.  These  appropriations
are  broken  down  by  budget  heading  on  the  basis  of  the
financial  plans  for  the  CSFs  and  SPDs.

estimates 

for 

5.4. The  estimates  for  payment  appropriations  are
drawn  up  by  applying  percentages,  calculated 
in
accordance  with  the  theoretical  and  historical  trend  in
payments,  to  the  commitment  appropriations  of  the  year
and  to  the  amounts  still  to  be  settled.

5.5. The  forecasts  for  appropriations  are  drawn  up  by
the  Commission  departments  at  the  beginning  of  the
preceding  financial  year,  and  the 
initial  entries  of
appropriations  in  the  budget  and  the  way  in  which  they
are broken down by item are rough estimates which, as is
apparent  right  from  the  beginning  of  the  budgetary
procedure,  bear  little  relation  to  reality.  Until  1998,
neither  amending  letters  nor  preliminary  draft  amending
and  supplementary  budgets  were  drawn  up  to  take
account  of  the  true  trend  in  aid  measures  and  the
continual  amendments  to  the  financial  plans.  The
Commission  rectifies  this  situation  by  making  use  of
transfers.

5.6.
In 1994, given the late adoption by the Commission
of  the  guidelines  relating  to  the  CIs,  it  became  apparent
that  the  majority  of  the  programmes  could  not  be
approved during the year. However, transfers were made
to the budget items for the CIs from the reserve (Chapter
B0-4  0  of  the  budget).  They  proved  to  be  unnecessary,
because  at  the  end  of  the  financial  year  1994,  the

5.7. The  financial  plans  for  the  aid  measures,  drawn  up
by  year,  bring  together  the  planned  expenditure  for  the
entire  period  of  eligibility  of  the  commitments.  It  is
therefore  logical  to  conclude  that  the  figures  shown  in
these  plans  represent  estimates  of  commitments  for  the
measures.  However,  when  amendments  are  made,  the
revised  plans  include  the  expenditure  actually  incurred
for the years that have passed plus new estimates for the
years  still  to  come.  They  thus  become  hybrid  in  nature
and  are  in  fact  made  up  of  neither  commitments  nor
payments  but  of  a  mixture  of  these  two  categories  of
operations.  The  latter  years  of  the  commitments’  period
of  eligibility  are  thus  artificially  inflated  since  they
contain  payment  estimates  that  can  be  carried  out  in  the
Member  States  for  two  extra  years  not  included  in  the
financial  plans.  The  usefulness  of  these  plans  is  thus
limited,  and  yet  they  constitute  a  key  element  in  the
process  of  drawing  up  the  preliminary  draft  budget.

5.8. The  indexing  method  for  the  SFs  was  made  more
flexible  for  the  period  1994-1999 (8).  The  additional
resources  generated  by  the  indexation  of  each  CSF,  SPD
and  CI  have  to  be  calculated  by  the  Commission
departments,  at  the  latest  by  the  beginning  of  each  year,
by  applying  the  indexation  rate  for  the  year  in  question
to  the  annual  instalments  referring  to  the  same  year  and
to  the  following  years.  These  resources  can  be  used  to
increase  the  Community  aid  of  existing  aid  measures
and/or  to  finance  new  operations.  The  Monitoring
Committees  propose  these  allocations,  which  are  decided
by  the  Commission.

5.9.
In  practice,  and  bearing  in  mind  the  delays  at  each
stage  of  this  procedure,  the  resources  arising  from
indexation  have  not  been  used  and  have  thus  remained
potential,  pending  a  formal  decision  by  the  Commission,
without having been recorded. For example, the resources
transferred  from  the  1994-1996  period  to  that  of

(8)  Commission  Regulation  (EC)  No  402/94  of  23  February
1994  amending  Regulation 
(EEC)  No  1866/90  on
arrangements  for  using  the  ecu  for  the  purposes  of  the
budgetary  management  of  the  Structural  Funds.

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1997-1999  under  the  O2  were  not  used  until  the
decisions  to  grant  them  were  taken  in  1997  and  1998.
This  situation  makes  it  even  more  difficult  to  keep
abreast  of  the  state  of  progress  of  the  programming.

6.  DELAYS  IN  THE  UTILISATION  OF  COMMUNITY
APPROPRIATIONS  AT  THE  LEVEL  OF  CERTAIN
INDIVIDUAL  FORMS  OF  INTERVENTION

General  observations

period  were  not  adopted  until  July  1993 (10).  It  was  thus
difficult  for  the  aid  measures  to  start  up  as  of  1  January
1994,  as  that  left  only  five  months  to  set  up  the
partnership,  draw  up  the  plans  for  the  various  objectives
and  submit  them  to  the  Commission (11),  define  and
adopt  the  decisions  concerning  the  CSFs  or,  where
appropriate, the SPDs, make suitable ex ante evaluations,
and  present  and  approve  the  aid  requests.  Furthermore,
the  plans  under  O2  and  O5b  could  not  be  drawn  up
until  the  lists  of  eligible  areas  were  determined,  and  the
Commission  did  not  do  this  until  20  and  26  January
1994  respectively (12).

implementation; 

6.1. As  part  of  this  audit,  an  analysis  was  made  of  the
various  reasons  that  may  underlie  the  delays  in  the
utilisation of Community appropriations, classified below
in  four  categories:  programming,  financial  channels,
this
mobilisation  of  resources  and 
involved examining the documents available, in particular
the 
implementation  and  evaluation  reports  and  the
minutes  of  the  Monitoring  Committees.  This  work  was
followed  up  by  audit  visits  to  the  Member  States  and  by
a  questionnaire  sent  to  selected  administrators;  Table  9
shows  a  summary  of  the  replies  received.  For  the
purposes  of  drafting  this  questionnaire,  a  list  was  drawn
up  of  the  reasons  actually  behind  the  cases  of  under-use
of  appropriations.  Apart  from  reasons  of  a  structural
nature,  such  as  the  large  number  of  aid  measures  or  the
delays in the adoption of the CIs, about 40 reasons were
identified.  The  questionnaire  was 
the
to 
administrators  of 
intervention
co-financed by the ERDF and belonging under Objectives
1  and  6  which,  at  31  December  1996  (midway  through
the  implementation  period),  had  the  lowest  rates  of  use
of  appropriations  of  all  the  SFs (9).  It  should  be
emphasised that the questionnaire is therefore targeted at
a particular sub-population and that the replies cannot be
extrapolated  to  all  the  aid  measures.  Even  though  the
sample  of  programmes 
is  not
representative  of  this  whole,  the  results  of  the  survey
have  nevertheless  proved  to  be  useful  for  illustrating  the
problems  involved  in  using  appropriations.

forms  of 

examined 

the  31 

thus 

sent 

the 

eligible  areas, 

6.3. The  coordination  Regulation  stipulated,  except
where  otherwise  provided  for  by  the  Member  State
concerned,  that,  within  three  months  of  the  entry  into
force  of  the  Regulation  (3  August  1993)  or  the
drawing-up  of 
the
lists  of 
corresponding  plans  should  be  submitted,  and  within  six
months  of  these  plans  being  received  the  Commission
Decisions  approving  the  CSFs  should  be  adopted.  Lastly,
the  CSFs  and  the  SPDs  for  O1  were  adopted  in  the
summer  of  1994,  and  those  relating  to  O2  in  December
1994.  Subsequently,  the  CSFs  had  to  be  made  more
specific  by  means  of  the  adoption  of  the  OPs,  overall
subsidies  and  individual  projects.  It  would  have  been
expedient  if  this  process  could  have  been  completed  in
1994,  but  this  was  not  possible.

6.4. Furthermore,  the  same  coordination  Regulation (13)
required  the  Commission  and  the  Member  States  to
ensure  that  the  actions  accounting  for  at  least  two  thirds
of the Fund aid for the first year of the CSFs be approved
by  the  Commission  within  two  months  of  the  adoption
of  the  decision  relating  to  the  CSFs.  This  was  not  the
case,  especially  with  regard  to  O1  in  Italy  and  O2  in
Spain.

6.2. The  majority  of  the  administrators  who  replied  to
the  questionnaire  regarded  the  delays  in  the  adoption  of
the CSFs and  SPDs as  the chief cause of the low rates of
utilisation of Community appropriations. The regulations
governing  the  SFs  for  the  1994-1999  programming

6.5. Furthermore,  at  31  December  1997,  large  amounts
of  the  planned  overall  funding  had  still  not  been
distributed,  and  there  were  the  results  of  the  indexation.
As  regards  the  period  1997-1999  of  the  O2,  for  which
the  delays  in  the  adoption  of  the  regulations  cannot  be
used by way of justification, several decisions to grant aid
were  not  approved  until  1998.

(9)  54 replies to the questionnaire were received. This number is
higher  than  the  31  interventions  selected  because,  for  some
interventions,  several  partners  replied  separately.  O1  was
chosen because of its size (it represents more than two thirds
of the overall funding for the SFs) and because all the Funds
are  involved  in  it.  O6  was  selected  because  it  is  analogous
with  O1.  The  analysis  of  O2  was  made  on  the  basis  of
records.

(10) Regulations  (EEC)  No  2080/93,  (EEC)  No  2081/93,  (EEC)
No  2082/93,  (EEC)  No  2083/93,  (EEC)  No  2084/93,  (EEC)
No  2085/93  of  20  July  1993  (OJ  L  193,  31.7.1993).

(11) Regional  development  plans  (O1);  regional  and  social
conversion plans (O2); rural development plans (O5b); plans
under  Objectives  3  and  4.

(12) Commission  Decisions  94/169/EC  and  94/197/EC.
(13) Article  10(2)  of  Regulation  (EEC)  No  4253/88.

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6.6. One  of  the  other  main  causes  of  the  delays  in  the
utilisation of Community appropriations is, in the eyes of
the  majority  of  administrators,  the  slowness  of  the
Community  and  national  procedures  set  up  in  order  to
ensure  compliance  with  Community  rules.

6.7. Further  delays  may  be  caused  by  the  integration  of
national  budgetary  implementation  procedures  with  the
management  of  Community  appropriations  relating  to
the  implementation  of  multiannual  programmes.  Thus,
where the way in which the expenditure is managed does
not  depend  on  the  origin  of  the  funds,  the  slowness  of
the  budgetary  implementation  procedures  linked  to  the
existence  of  Community  co-financing  is  not  regarded  as
an  important  factor  in  the  delays.  However,  where  new
procedures have to be added, or where separate files have
to  be  made  for  the  management  of  the  Community
appropriations  and  the  national  counterpart  funds,  the
administrators  regard  this  factor  as  important  or  very
important.  Often, 
lengthy  administrative
procedures that have to be gone through for Community
appropriations 
the  national
procedures  for  budgetary  implementation,  and  this  does
not  make  it  easy  for  the  aid  measures  to  go  ahead
speedily  and  flexibly.  Where  this  integration  is  done
large  number  of  tailor-made
project  by  project,  a 
budgetary  and  accounting  operations  have  to  be  carried
out  when  it  is  implemented.

there  are 

integrated 

to  be 

into 

the 

governing 

provisions 

6.8. The 
financial
implementation  of  the  SF  multiannual  aid  measures  are
based  on  the  Community  budgetary  implementation
procedures  for  differentiated  appropriations.  At  both
Community and national level, two different periods exist
side  by  side:  one  for  implementing  commitments  and  the
other  for  making  payments.  However,  this  concept  of
multiannual  commitment  is  very  often  alien  to  the
budgetary  procedures  applied  in  the  Member  States  by
the  public  authorities  and  by  businesses.

6.9. The  concept  of  legal  and  financial  commitment  at
national  level  and  the  determination  of  the  point  in  time
when  this  was  done  are  basic  factors  in  establishing  the
eligibility  of  expenditure (14).  Determining  these  dates
poses  a  very  important  problem  for  the  administrators,
which is difficult to overcome in practice, and it gives rise
to  uncertainty.  In  some  cases  and  in  order  to  introduce
certainty  as  to  the  date  of  commitment,  new  procedures
In  other  cases,  protracted
have  been 

introduced. 

(14) The  concept  of  commitment  was  once  again  spelled  out  in
eligibility  sheet  No  3  in  April  1997.  The  ‘compulsory  legal
provisions’  and  the  ‘commitments  of  the  necessary  financial
means’  were  defined  as  the  decisions  taken  by  the  final
beneficiaries  to  implement  the  eligible  operations  and  the
allocation  of  the  corresponding  public  funds  (OJ  L  146,
5.6.1997,  p.  1).

discussions  are  being  held  in  the  Member  State  and  with
the  Commission.  This  state  of  affairs  has  resulted  in
solutions  that  in  some  cases  are  directly  opposed  to  each
other,  and  which 
the
administrators  concerned  than  on  clearly  established
procedures:  some  reject  the  expenditure  incurred  if  there
is  the  slightest  doubt  as  to  its  eligibility;  others  keep  all
the  expenditure,  leaving  it  up  to  any  subsequent  checks
to  sort  out  the  eligible  items  from  the  ineligible  ones.

fact  depend  more  on 

in 

6.10. The  beginning  of  a  programme’s  period  of
eligibility  means  the  date  as  of  which  the  first  payments
can be made. However, if the initial date of commitment
of  the  expenditure  were  to  be  established,  this  would
make it possible to ascertain that the co-financing related
to  new  projects  and  not  to  projects  that  were  already
under way or even completed. For the commitments, only
a final date has been fixed, thus making it easier to carry
out  expenditure,  in  haste,  at  the  end  of  the  period.  The
financial implementation provisions ought to be closer to
the  Member  States’  procedures  and  should  not  deviate
from  the  aims  of  a  programme-based  approach.

6.11. The  impact  that  the  co-financing  of  structural
operations  has  on  the  capacity  to  utilise  Community
appropriations  differs  according  to  whether  existing  or
new  operations  are  involved.  When  the  SFs  co-finance
existing operations, progress is rapid; it may even happen
that  the  SFs  reimburse  expenditure  that  has  already  been
the  SFs  co-finance  new
incurred.  However,  when 
operations,  progress  is  much  slower,  because  of  the  need
to  start  up  all  the  implementation  procedures.

than 

if  they  are 

if  their  effect 

6.12. The  difficulties  in  coordinating  a  large  number  of
both Community and national administrators have led to
delays  in  implementation,  especially  in  the  case  of
multi-fund  programmes.  The  integrated  approach  which,
as  far  as  structural  aid  is  concerned,  should  be  playing  a
larger  role,  is  based  on  the  idea  that  the  impact  of  the
various  measures  will  be  greater 
is
implemented  separately.
combined  than 
However,  in  many  cases  the  multi-fund  programmes  are
no  more 
single-fund
sub-programmes  which  are  managed  independently  of
each  other  and  are  even  governed  by  implementing
provisions  that  differ  depending  on  the  Fund.  This  also
applies to numerous CI programmes where several Funds
are  involved  but  each  contributes  very  small  amounts.
These  situations  slow  down  the  procedures  without
offering  any  real  added  value.  Some  Member  States,
having  discovered  the  shortcomings  of  the  multi-fund
approach during the preceding period, have cut down on
the  number  of  programmes  of  this  type  that  they
present.

juxtaposition  of 

a 

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in 

of 

the 

the 

instrument 

partnership 

effectiveness 

6.13. The  Monitoring  Committees  ought  to  constitute  a
fundamental 
by
ascertaining that the aid measures are being implemented
efficiently. The Court has already pointed out the need to
the  Monitoring
improve 
Committees (15).  They  fail  to  operate  properly  because
they were set up late, they do not hold enough meetings,
their  procedures  for  adopting  decisions  are  lengthy  and
they  are  not  organised  in  a  suitable  manner  (too  little
time  for  studying  the  documentation  or  for  allowing  a
large  number  of  participants 
involved).
Furthermore, 
the  Monitoring  Committees’  decisions
usually  consist  only  of  proposals  submitted  to  the
national  authorities  and  to  the  Commission  requiring
explicit  confirmation,  which  once  again  sets  lengthy
procedures  in  motion.

to  be 

Programming

6.14. The  procedures  for  adopting  the  documents  that
form  part  of  the  programming  are  slow,  both  at
Community  level  (where  most  of  the  DGs  are  involved)
and  at  national  level  (where  there  needs  to  be  close
consultation  between  the  various  partners).  The  time
needed  may  depend  on 
and
administrative  structures  of  the  Member  States,  and  on
the  effectiveness  of  the  partnership.

institutional 

the 

in  adapting 

6.15. The  delays  in  Italy  may  be  explained  by  the
difficulties 
the  national  and  regional
management  structures,  which  were  more  suited  to
management  by  project  than  by  programme,  to  bring
them  into  line  with  the  reform  of  the  SFs.  These
structures  and  their  powers  have  undergone  considerable
changes,  which  has  not  made  it  any  easier  to  set  up  an
effective  partnership,  capable  of  rapidly  overcoming  the
difficulties 
the  various
that  have  arisen  during 
programming  phases.  The  Community  procedures  have
been  designed  for  the  management  of  programmes  and
they  are  not  geared  to  finding  speedy  solutions  to
problems  that  arise  for  individual  projects.

6.16. The  weakness  of  some  programmes  submitted  to
the  Commission  and  the  efforts  made  by  the  latter  to
improve  their  quality  have  resulted  in  delays  in  their
adoption.  However,  in  many  cases,  these  delays  are
disproportionate  to  the  improvements  that  have  to  be
made. They stem more from the Commission’s difficulties
in  managing  the  plethora  of  forms  of  intervention  that
have  been  proposed,  in  coordinating  its  departments  and
in  building  up  an  effective  partnership  culture  with  the
Member  States.  In  some  cases,  it  took  several  months  or

(15) Most  recently  in  the  Annual  Report  concerning  the  financial

year  1996,  paragraphs  7.15-7.19  and  7.59.

even  years  for  the  detailed  rules  for  implementing  the
individual  projects  to  be  laid  down,  following  exchanges
of  correspondence  and  discussions  which  did  not  make
much  headway.  As  regards  Italy,  for  example,  at  31
December  1994,  only  5 130,3  Mio  ECU  of  aid  had  been
approved out of a planned total of 14 860 Mio ECU, and
programmes  presented  in  1994  were  not  adopted  until
1997.

6.17. The  global  subsidy  for  Andalusia,  presented  in
April  1994,  was  approved  in  September  1995  and  the
related  agreement  was  signed  in  January  1996.  Also,  the
suspensive  clause  relating  to  the  ‘risk  capital’  measures
which  was  included  in  the  decision  was  not  rescinded
until  November  1997.

such  as 

6.18. Often, suspensive clauses could have been avoided
or  rescinded  earlier  if  there  had  been  better  coordination
within the Commission and between the Commission and
the  Member  States.  There  have  also  been  cases  where
suspensive clauses have been introduced following purely
formal  difficulties, 
lack  of  precise
identification  of  an  aid  scheme  that  had  in  fact  already
been approved by the Commission. Files relating to these
clauses have been shelved for a very long time (sometimes
for  years)  without  any  significant  headway  being  made,
especially  in  the  case  of  the  most  innovative  measures.
Frequently,  the  delays  in  overcoming  these  problems,
especially  within  the  framework  of  the  aid  measures  for
the  O2  for  1994-1996,  have  led  to  the  operations
concerned  being  replaced  by  more  traditional  measures.

the 

6.19. The  fact  that  the  annual  financial  plans  drawn  up
in  the  SPDs/OPs  are  unrealistic  has  also  contributed  to
the  low  rates  of  utilisation  of  appropriations.  As  a  rule,
these plans have been drawn up following the increase in
the  annual  commitments  provided  for  in  the  financial
perspective  without  taking  into  account  their  feasibility
on the ground. Right from the time the plans were drawn
up,  the  administrators  of  the  programmes  were  already
aware that it would be impossible to abide by the annual
allocation  laid  down  in  the  financial  plans.  This  state  of
affairs is corroborated by the amendments made to these
plans  and  the  scale  of  these  amendments.

had 

two 

aspects  which 

6.20. Furthermore, 
a
considerable  impact  on  the  way  in  which  the  aid
measures  were  implemented  at  the  beginning  of  the
period  were  neglected  at  the  time  of  the  programming.
The  first  was  the  delay  in  adopting  the  aid  measures.
Admittedly,  the  eligibility  of  the  expenditure  began  on  1
January  1994  for  requests  presented  to  the  Commission
before the end of April 1994, but the selection procedure
for the individual operations was not able to get properly
under  way  in  most  cases  until  the  programmes  were
adopted. It was only in cases where advance financing of
possible
the 

measures 

made 

was 

aid 

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that  the  operations  were  able  to  start  up  at  the  proper
time.  However,  under 
the  system  of  payment  of
Structural  Fund  advances  and  the  programme  concept,
advance  financing  by  the  SFs  is  supposed  to  be  the
norm.

6.21. The second aspect was linked to the completion of
the  aid  measures  of  the  preceding  periods  and  to  the
cases  of  overlapping  in  the  commitment  and  payment
periods  at  national  level.  Thus,  during  the  first  years  of
the  new  generation,  expenditure  that  could  have  been
eligible  for  both  periods  was  allocated  to  that  of
1989-1993 in order to finish up the still unused aid. This
had  the  effect  of  reducing  the  potential  expenditure  for
the 1994-1999 generation. This aspect had a great impact
on  the  Member  States  and  regions  that  had  the  largest
backlogs  in  the  closure  of  previous  aid  measures.

6.22. The procedures for amending the SPDs and the aid
measures  of  the  new  generation  aimed  at  simplification
by  increasing  the  powers  of  the  Monitoring  Committees.
However,  in  practice,  the  procedure  that  was  followed
was  the  formal  adoption  of  new  decisions  by  the
Commission,  a  cumbersome  procedure  requiring  the
inter-departmental  consultations  and
organisation  of 
involving  the  same  difficulties  as  those  connected  with
the  adoption  of  the  CSFs/SPDs/OPs.  In  some  cases,
because  of  the  delays,  the  proposals  for  amendments
were  obsolete  even  before  they  were  decided  on.

Financial  channels

for  Community 

6.23. The  complexity  of  the  financial  channels  at  all
levels  (Community,  national,  banking),  the  periods  of
time needed for each authorising procedure and the large
number of parties involved mean that it takes a very long
time 
final
funds 
beneficiaries.  Furthermore,  because  of  this  complexity,  it
is  difficult  to  monitor  what  stage  of  their  journey  the
funds  have  reached.  The  Court  has  on  several  occasions
referred  to  the  difficulties  arising  from  the  duration  and
the  diversity  of  the  financial  channels (16).

reach 

the 

to 

6.24. As regards the funds reaching the beneficiaries, the
coordination  Regulation  stipulates  that  the  latter  should
receive  the  amounts  of  advances  and  payments  in  the
shortest possible time which should not, as a rule, exceed
three  months  from  the  date  when  the  Member  State
received 
the
beneficiaries’  claims  satisfy  the  conditions  stipulated  for
making  the  payment (17).  As  these  conditions  have  not

appropriations,  provided 

that 

the 

been sufficiently defined, and bearing in mind the existing
procedures,  the  periods  of  time  taken  to  pass  the  funds
on  to  the  beneficiary  are  very  variable.  As  a  rule,
payments  to  the  beneficiaries  are  made  by  the  national
authorities  as  and  when  the  Community  payments  are
received,  but  the  criteria  and  lengths  of  time  taken  for
these  payments  depend  on  conditions  over  which  the
beneficiary  has  no  control,  such  as  the  point  in  time
when  the  expenditure  threshold  that  triggers  Community
payment is crossed. In any case, the progress made by the
measures  concerned  is  not  the  main  criterion.  This  being
so, it becomes difficult to draw up estimates for the cash
funds  of  the  beneficiaries.

two 

things  happen 

6.25. When  there  are  delays  in  carrying  out  an  aid
simultaneously.  For
measure, 
measures  that  are  proceeding  normally,  the  beneficiaries
find  themselves  penalised  by  the  delays  in  the  other
measures and have to arrange advance financing for them
if  they  want  to  continue  with  them.  In  the  case  of
measures  that  are  proceeding  very  slowly  or  not  at  all,
the  beneficiaries  are  paid  advances  which  they  do  not
necessarily yet need. As part of SEM 2000 (18) and in the
proposal  for  a  new  Regulation  on  the  Structural  Funds,
the  Commission  tackled  the  question  of  the  use  of  the
interest  likely  to  be  generated  by  the  funds  thus  paid  to
the  final  beneficiaries.  It  considered  the  possibility  of  the
interest  thus  earned  by  the  advances  being  allocated  to
the  aid  measure  concerned,  in  order  to  ensure  that  this
interest  be  used  in  compliance  with  the  objectives  of  the
Community  operation.

6.26.
In  the  case  of  aid  schemes  where  the  body  which
grants  the  aid  is  regarded  as  the  final  beneficiary,  the
existing  procedures,  especially  in  some  countries  (such  as
Sweden  or  Finland),  allow  advances  to  be  paid  to  the
final beneficiaries only on certain conditions. As a result,
Community  advances  remain  with  the  administrating
body  pending  the  completion  of  the  work  or  the
investments.  In  cases  where  the  aid  schemes  represent  a
significant part of the aid measures, and bearing in mind
that  the  annual  financial  plans  drawn  up  are  unrealistic,
these  aid  measures  may  proceed  in  accordance  with  the
administrators’  estimates  in  terms  of  the  decisions  to
grant  aid 
the  utilisation  of
Community  appropriations  will  remain  low  until  the
completion of the investments and the payment of the aid
that  has  been  granted.

to  undertakings,  but 

6.27. An  analysis  of  the  situation  at  31  December  1996
regarding  the  OP  for  Saxony-Anhalt  shows  that  the
public  expenditure  increased  from  around  10 %  in  1994
to  82 %  in  1996  in  relation  to  the  initial  plans,  a  rise

(16) For  example,  the  Annual  Report  of  the  Court  of  Auditors

concerning  the  financial  year  1993,  paragraph  6.5.

(17) Article  21(5)  of  Regulation  (EEC)  No  4253/88.

(18) See  eligibility  sheet  No  8  (SEM  2000).

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which  represented  about  47 %  of  the  total  for  the  years
1994-1996 and 21 % of the total for the programme (19).
However,  if  the  decisions  to  grant  aid  are  scrutinised,  it
transpires  that  the  programme  as  a  whole  was  already
almost  fully  implemented  (84 %).  As  a  result,  the  delays
in  the  implementation  of  the  programme  are  not  due  to
the 
to
to 
programming  that  did  not  take  into  account  the  time
taken  for  the  implementation  of  the  projects  and  the
characteristics of the type of operation being co-financed.
It  should  be  noted  that  a  considerable  increase  in  the
rates  of  aid  in  1995  made  it  possible  to  allocate  the
Funds  more  quickly.

lack  of  projects 

finance,  but 

rather 

6.30. Most  of  the  Member  States  cite  difficulties  in
gathering financial data from the beneficiaries as a major
factor  in  the  delays  in  using  appropriations.  These
difficulties  lead  not  only  to  errors  in  the  expenditure
declarations  but  also  to  delays  in  drawing  them  up  and,
consequently,  in  the  funds  being  received.  These  same
difficulties, coupled with the length of the channels along
which  the  data  have  to  be  sent,  prevent  the  setting-up  of
procedures  allowing  a  declaration  of  expenditure  to  be
drawn  up  as  soon  as  the  threshold  for  triggering  the
payments  has  been  reached.

6.28. The  way 
in  which  Community  and  national
payments are concentrated at the end of the year and the
fact that decisions relating to aid measures, whether they
are initial decisions or amending ones, are adopted at the
end  of  the  year  have  adverse  consequences  for  the
beneficiaries,  who,  being  subject  to  annual  budgets,  can
only  watch  whilst  their  estimates  are  undermined  or  are
modified.  If  the  funds  arrive  in  the  following  financial
year,  lengthy  budgetary  procedures  are  often  needed  to
integrate these funds into their budgets. In some Member
States,  these  funds  are  not  allowed  to  be  entered  in  the
budget and used unless their arrival can be guaranteed. In
other  cases,  the  appropriations  that  are  not  used  at  the
year-end  are  not  automatically  carried  over.

6.29. One  of  the  weakest  points  in  the  management  of
the aid measures is the financial and physical monitoring
of the operations that are being carried out. As there are
many  operations  and  the  beneficiaries  are  scattered,
effective  procedures  need  to  be  set  up  making  it  possible
to  monitor  the  operations  and  their  expenditure  by
co-financed  operation.  These
beneficiary  and  by 
it  easier  to  draw  up  the
procedures  should  make 
declarations  of  expenditure,  which  must,  moreover,  be
based  on  a  suitable  set  of  accounts (20).  The  Court  has
noted (21),  in  particular  in  the  context  of  the  DAS,  that
these  declarations  of  expenditure  are  not  always  reliable,
bearing  in  mind  the  unsuitable  nature  of  the  procedures
introduced  for  drawing  them  up  and  checking  them (22).

(19) See  ‘Interim  evaluation  of  the  measures  taken  under  the  EU
Structural  Funds  in  Saxony-Anhalt  in  the  period  from  1994
to  1996’  —  Ministry  for  Economic  Affairs,  Technology  and
European  matters  —  Saxony-Anhalt.

(20) The financial implementation provisions applicable to the aid
measures  included  in  the  CSFs,  SPDs  provide  for  systems  of
separate  accounting  to  be  used.

(21) Annual  Report  of 

the  European  Court  of  Auditors
concerning  the  financial  year  1996,  paragraph  6.25.  DAS
report  of  the  European  Court  of  Auditors  concerning  the
financial  years  1996,  1995  and  1994.

(22) The  new  Regulation  (EC)  No  2064/97  of  15  October  1997
aims  to  provide  a  better  framework  for  the  financial  control
carried  out  by  the  Member  States  on  the  operations
co-financed  by  the  Structural  Funds  (OJ  L  290,  23.10.1997,
p.  1).

6.31. The  national  administrators  are  not  always  aware
of  the  thresholds  triggering  the  Community  payments.
Furthermore,  additional  delays  occur  once  the  data  have
been gathered because they have to be processed, certified
and  passed  on.  In  Sardinia,  payment  claims  were  not
triggering
submitted,  even 
payments  had  been 
exceeded.  The
expenditure  incurred  by  31  March  1997  had  reached  a
level  that  would  have  allowed  payment  of  the  1994
balance  and  of  the  first  two  advances  for  1995,  i.e.  68,8
Mio  ECU,  but  it  was  not  until  October  1997  that  an
additional  expenditure  declaration  was  sent  to  the
Commission.

considerably 

thresholds 

though 

the 

6.32. The  number  of  cases  arising  where  disbursement
of  several  payments  is  requested  on  the  basis  of  a  single
expenditure  declaration  confirms  the  need  to  make  more
checks  to  ensure  that  the  Member  States  submit  their
claims on the basis of a programme staggered throughout
the year, as stipulated in Article 19.3 of the coordination
time 
Regulation.  Furthermore, 
the
Commission 
the  declarations  and
authorising  payment  should  not  exceed  two  months
starting from the date on which a valid claim is received,
but this time-limit is not always complied with, especially
as  regards  payments  of  balances (23).

the 
scrutinising 

taken  by 

for 

6.33. All the time taken to transmit and process the data
delays  the  payment  of  Community  appropriations.  Their
level of utilisation is not representative of the true state of
progress  of  the  aid  measure,  which  is  only  partly  known
when  the  annual  reports  are  being  drawn  up  or  when
meetings  of  the  Monitoring  Committees  are  held.

Mobilisation  of  resources

6.34. Difficulties  arise  in  using  the  national,  regional
and  private  counterpart  funds  in  accordance  with  the
planned 
the  ex  ante
assessments are weak or in cases where there are no prior
feasibility studies taking into account the procedural time

timetable,  especially  when 

(23) See  Special  Report  on  the  closure  of  the  ERDF  forms  of

intervention.

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needed.  The  optimistic  nature  of  the  financing  plans  for
the  operations  becomes  apparent  when  it  comes  to
actually  preparing  the  implementation  of  certain  projects
and  when  use  of  the  counterpart  funds  gets  under  way.

in  cases 

involving 

6.35. The task of mobilising public resources takes time,
and  this  is  often  underestimated.  Thus,  it  is  virtually
inevitable  that  there  will  be  delays  or  even  log  jams,
especially 
large-scale  projects  or
innovative  measures,  which  are  usually  complex.  When
the  regional  and  local  authorities  that  receive  the  aid  do
not  have  a  large  degree  of  financial  independence,  the
delays  in  the  payment  of  the  national  counterpart  funds
have  a  knock-on  effect  on  the  implementation  of  the
operations,  as  the  Court  has  already  pointed  out (24).

6.39. This  is  also  the  case  for  the  OPs  in  the  new
German  Länder,  which  are  based  on  private  investment.
An  analysis  of  the  co-financed  projects  made  during  the
evaluation  process  for  the  Saxony-Anhalt  OP  showed
that  30 %  of  the  projects  were  suffering  from  delays  of
about  two  years.  The  amount  of  the 
investments
underwent  considerable  changes  in  41 %  of  the  projects
(27 %  to  increase  the  investments  and  14 %  to  reduce
them).  The  scale  of  these  modifications  and  delays  also
in  the  ex  ante  evaluations  of
shows  shortcomings 
projects.  Some  of  the  chief  reasons  cited  by  the
beneficiaries to explain the main delays in the investments
or  their  reduction  during  implementation  include  not
only the length of the procedures needed before the work
can  be  started  but  also  the  economic  situation  of  their
sector,  the  overall  trend  in  their  business,  financing  and
cash-flow  problems  and  delays  due  to  suppliers  and
service providers.

6.36. The  SPD  for  Corsica  was  based  on  major  public
infrastructure  projects,  in  particular  the  main  road  from
Ajaccio  to  Bastia,  the  treatment  of  waste  water,  refuse
treatment  and  water-supply  works.  Sometimes  major
projects have not yet been the subject of an agreement in
respect  of  their  implementation  (road  project)  or  it  has
been  very  difficult  to  find  counterpart  funds  (public
building).  This  has  led  to  delays  in  settling  the  financial
plans  or  even  to  a  project  that  was  originally  planned
being  abandoned.

funds 

6.37. Thus,  for  the  projects  relating  to  refuse  treatment
under  this  SPD,  for  want  of  sufficient  public  counterpart
funds for financing two incinerators, the authorities tried
to  mobilise  private  counterpart 
through  a
‘public-service  delegation’  whereby  the  private  sector
carries  out  a  project  intended  for  the  general  public  and
runs  it  at  a  profit  by  means  of  an  operating  concession.
However,  because  the  negotiations  with  the  Commission
to  re-define  the  concept  of  eligible  expenditure  took  a
long  time  (more  than  15  months)  and  because  of  legal
problems,  all  that  was  achieved  was  that  implementation
of  these  operations  may  still  be  envisaged  within  the
framework  of  the  SPD.

6.38. The  mobilisation  of  private  counterpart  funds  is
difficult  to  control,  because  it  depends  on  numerous
factors. For this mobilisation to take place, the files have
to  be  sufficiently  well  advanced  and  their  feasibility
properly  established.  Within  the  framework  of  the  aid
measures where there is considerable private involvement,
the  investments  are  affected  by  the  economic  situation
and their progress is less easy to forecast. This is the case
for  the  O2  programmes,  which  are  aimed  at  regions
suffering  from  industrial  decline.

(24) For example, see the Annual Report concerning the financial

year  1996,  paragraphs  7.52-7.57.

that 

replied 

the  authorities 

6.40. The budgetary restrictions relating in particular to
the  stabilising  of  public  finances  in  the  run-up  to  the
creation  of  the  economic  and  monetary  union  are  not
regarded  by 
the
questionnaire as one of the most important factors in the
low  rate  of  utilisation  of  appropriations.  There  was  not
found  to  be  any  connection  between  these  restrictions
and the level of use of Community appropriations, which
has  been  on  the  increase  since  1994.  A  study  on  this
subject  drawn  up  on  behalf  of  the  European  Parliament
concludes  that  this  trend  was  not  found  to  have  any
direct  influence  on  the  implementation  of  appropriations
in  the  various  cases  examined  by  the  authors (25).

to 

6.41. Several  reasons  may  be  cited  to  explain  this
situation.  On  the  one  hand,  the  authorities  of  the
Member  States  have  endeavoured  not  to  curtail  their
budgetary  contribution  to  the  co-financed  operations  so
as to avoid delaying the arrival of Community funds. On
the  other  hand,  the  changes  made  to  the  programmes
make  it  possible,  by  replacing  measures,  to  select  the
projects  for  which  national  counterpart  funds  are
available.

at 

still 

projects  which  were 

6.42. New 
the
drawing-board  stage  were  introduced  into  the  OP  for
Sardinia. This policy, which is, moreover, the one most in
keeping  with  the  spirit  of  the  regulations,  should  have
been accompanied by financial plans that took account of
the lengthiness of the procedures. The latter mean that in
many  cases  the  projects  do  not  get  off  the  ground  until
some  years  after  they  have  been  decided.  It  should  be

(25) Factors 

influencing 

the  utilisation  of  Structural  Fund
appropriations.  European  Parliament.  Directorate-General
for  Studies.  June  1997.

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borne  in  mind  that  it  is  not  the  lack  of  national  public
appropriations  to  assist  regional  development  in  Sardinia
that  is  behind  the  difficulties  in  making  use  of  the
Community  appropriations.  The  regional  budget  made
for  a  volume  of  expenditure
provision 
potentially  eligible  for  co-financing  that  was  comparable
to  that  of  the  public  expenditure  planned 
in  the
programme  for  the  entire  period  1994-1999.

for  1997 

in 

6.43. The  variations 
the  national  currency/ecu
exchange  rate  have  adverse  effects  on  the  utilisation  of
Community  appropriations.  These  effects  stem  from  the
fact  that  the  measures  are  implemented  in  national
currency and that the accounts for their aid measures and
their financial plans are drawn up in ecu. In the event of
a  devaluation,  there  needs  to  be  an  increase  in  the
expenditure  in  national  currency  in  order  to  achieve  the
amounts provided for in ecu. If there is a revaluation, this
leads 
the  Community
counterpart,  which  has  to  be  covered  by  national
expenditure.

relative  decrease 

to  a 

in 

to 

the  amendments 

6.44.
In  both  cases,  the  programming  is  thus  altered
and,  if  there  is  no  speedy  reaction,  the  impact  may  be
the
if 
considerable,  especially 
exchange rate occur at the end of the period. In Italy, the
failure  to  take  effective  action  in  response  to  this
situation  had  adverse  repercussions  on  the  closure  of  the
preceding  period.  In  other  Member  States,  provision  was
made  for  measures  to  alleviate  the  consequences  of  this
situation,  such  as  making  the  declaration  of  expenditure
in ecu, making the declaration of expenditure in national
currency  at  a  faster  rate  or  creating  stocks  of  projects
(overbooking).

Implementation

6.45. Despite  the  length  of  time  that  has  elapsed  since
the  1988  reform  of  the  SFs,  the  beneficiaries  are  still
rules  and
familiar  with  Community 
insufficiently 
procedures.  The  difficulties  experienced 
in  Sardinia
concerning  key  elements  of  the  aid  measure,  such  as  the
terms  ‘commitment’,  ‘final  beneficiary’  and  ‘eligibility  of
expenditure’,  could  have  been  curtailed  if  they  had  been
the  partnership.  The
clarified 
misunderstandings 
eligible
expenditure, which have led to the total cost being taken
into  account  instead  of  the  public  expenditure,  have  had
as  a  consequence  a  delay  in  the  implementation  of  38,3
Mio  ECU  of  Community  appropriations.

the  context  of 

to  determining 

relating 

in 

unforeseeable,  others  ought  to  have  been  borne  in  mind
when the programming was being carried out. By way of
example, the new Member States had to introduce major
changes  to  their  procedures  and  departments  in  order  to
adapt  themselves  to  the  management  mechanisms  of  the
Community  programmes,  which  gave  rise  to  lengthy
delays in relation to the programming, which was drawn
up  as  though  the  administrators  and  procedures  were
operational  from  the  very  beginning  of  the  period.  In
Greece,  the  implementation  of  the  industry  OP  required
21  new  legislative  texts  or  regulations.

6.47. Where  Article  24  of  Regulation 
(EEC)  No
4253/88 on the reduction, suspension and suppression of
aid 
is  applied,  even  though  this  does  not  happen
frequently, this may have an effect, even indirectly, on the
progress  of  the  programmes.  By  way  of  example,  one  of
the  Spanish  programmes  (Cantabria)  suffering  from
delays  was  affected  by  the  reimbursement  of  amounts
that  were  not  used  for  implementing  a  major  project
during  the  period  1989-1991 (26).  Furthermore,  delays  in
this  programme  also  stemmed  from  the  fact  that  the
1994 regional budget was not adopted until March 1995.
In the end, the 1994 tranche had to be cancelled and the
1995  one  considerably  reduced.  There  are  also  —  more
frequent  —  cases  where  the  Commission  de  facto
suspends  payments  for  several  months  or  even  several
years,  whilst  waiting  for  its  disagreements  with  the
Member  State  concerned  to  be  settled (27).

6.48. Several  administrators  have  cited  examples  of
delays connected with the lack of suitable coordination at
the  Commission.  Where  different  departments  each
interpret matters differently, this has an adverse effect on
the  way  the  aid  measures  are  managed,  without  the
Member  States  always  being  aware  of  the  reasons  for
these  delays.  One  of  the  main  difficulties  encountered  by
the  administrators  of  the  multi-fund  Hainaut  SPD  was
due  to  three  projects  being  charged  to  the  ESF  rather
than  to  the  ERDF,  thus  requiring  the  transfer  of  the
funds  relating  thereto,  and  to  the  different  financial
management  systems  of  the  Funds  (multiannual  for  the
ERDF  and  the  EAGGF,  annual  for  the  ESF).  According
to  the  administrators  concerned,  this  situation  has  led  to
a  delay  of  several  months  in  the  ESF  payments.

6.49. The  balance  of  each  commitment  is  not  paid  until
the annual implementation report has been drawn up and
sent  to  the  Commission  and  then  approved  by  the  latter.
These  stages  continue  to  lead  to  delays.  In  some  cases,

In  several  cases,  the  delays  can  be  attributed  to
6.46.
exceptional  circumstances,  such  as  the  reorganisation  of
departments,  political  changes,  natural  catastrophes  or
changes  in  the  administrative  environment.  Whilst  some
their  very  nature
of 

these  circumstances  are  by 

(26) See  the  Annual  Report  of  the  European  Court  of  Auditors

concerning  the  financial  year  1994,  paragraph  4.74.

(27) See the Annual Reports of the Court of Auditors concerning
the financial years 1994 and 1995, paragraphs 5.42-5.44 and
paragraphs  6.16-6.19.

16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/61

the  payment  of  the  balance  cannot  be  made  because  the
corresponding  authorities  have  failed  to  present  the
required  annual  report  or  because  this  report  is  not  of  a
sufficiently  high  standard.

involving some 12 Mio ECU had to be replaced following
the  Court’s  audit.

6.50.
It  often  happens  that  where  there  are  delays  or
failures  concerning  a  measure  or  a  project  that  accounts
for  a  large  portion  of  the  OP  in  financial  terms,  the
whole  of  the  aid  measure  is  put  into  jeopardy.  The  aid
measure’s financial progress is held up whilst waiting for
the amendment procedures to be finalised. In Sardinia, in
the  case  of  two  projects  accounting  for  28 %  and  35 %
of  the  total  cost,  implementation  had  not  even  started
halfway  through  the  period.  The  programme  was  not
amended  until  December  1997,  despite  the  fact  that  the
various  partners  involved  had  pointed  out  the  need  to
its
change 
implementation.

beginning 

from 

right 

the 

of 

it 

6.51. The 
individual  operations  and  projects  often
encounter  difficulties  which  mean  that  they  are  late  in
getting  off  the  ground  in  relation  to  the  beneficiaries’
forecasts.  The 
latter  tend  to  be  over-optimistic,  a
tendency fuelled by the lack of any feasibility studies and
the  administrators’  practice  of  accepting  these  forecasts
without  checking  whether  they  are  plausible.  During  the
procedures  concerning  expropriation,  the  tendering  of
public  contracts  or  the  evaluation  of  the  environmental
impact,  it  is  rare  for  delays  not  to  occur.

6.52. From  a  detailed  analysis  of  the  OPs  for  Sardinia
and Corsica it is apparent that the implementation delays
stemmed  from  the  periods  of  time  that  were  inherent  in
the  procedures  or  were  needed  to  reach  agreements
between  the  various  partners.  In  the  case  of  the  most
the
important  measure  of 
gasification plant, the technical difficulties experienced in
carrying  out  the  project  and  the  problems  in  agreeing  on
the  financial  plan  with  the  banking  partners  had  not  yet
made it possible to finalise the drafting of the project. In
the end, this measure was cancelled when the programme
was  amended  in  December  1997.

for  Sardinia, 

the  OP 

are 

there 

sometimes 

6.53. Furthermore, 
other
circumstances  that  give  rise  to  delays  and  cost  increases:
for  example,  unforeseen  technical  difficulties  may  occur,
contractors  may  go  bankrupt,  additional  work  may  have
to  be  done,  etc.  These  delays  are  exacerbated  by  the
slowness  of  the  procedures  to  amend  the  measures
concerned,  to  take  account  of  these  circumstances  or
changes  in  priorities.  The  irregular  expenditure  found
during the checks may also give rise to delays, in view of
the  fact  that  these  items  of  expenditure  have  to  be
withdrawn 
the  expenditure  declarations  and
replaced  by  those  from  alternative  projects.  This  was  the
case  in  Saxony-Anhalt  where  a  major  investment  project

from 

7.  CONCLUSION

7.1. The  way  in  which  the  budget  estimates  are  drawn
up  needs  to  be  improved  in  order  to  avoid  cases  of
under-utilisation  of  appropriations  and  to  cut  back  the
volume  of  transfers.

governing 

provisions 

7.2. The 
budgetary
implementation  of  the  structural  operations,  especially
those relating to commitment by annual tranches, need to
be reviewed so as to ensure consistency with the Financial
Regulation  and  with  all  the  budgetary  provisions.

the 

the 

In  revising  the  provisions  governing  the  financial
7.3.
and  budgetary 
structural
implementation  of 
operations,  the  aim  should  be  to  make  them  simpler,
more  transparent  and  less  cumbersome.  The  proposals
relating  to  the  new  Structural  Fund  Regulations  which
the  Commission  presented  on  18  March  1998  contain  a
simplification  in  this  area,  in  particular  by  introducing
for
new  rules 
indexing.

for  commitments  by 

tranche  and 

reproducing 

7.4. To date, the financial programming of the CSFs and
the forms of intervention of the structural operations has
been  done  by 
the  chart  of  annual
expenditure  set  out  in  the  financial  perspective.  It  is  very
hard  for  this  approach  to  take  account  of  feasibility  on
the  ground  and  it  results  in  a  muddled  picture  being
given  of  the  implementation  of  the  aid  measures.  The
financial  plans  are  of  little  practical  use  and  they  are
amended  time  and  again  and  yet  they  still  do  not  reflect
the  actual  estimates  for  the  implementation  of  the
measures any better. The fact that the amounts recurring
annually  are  concentrated  in  the  latter  years  of  the
programming  period  could  lead  to  difficulties  in  closing
the  aid  measures  for  the  period  1994-1999,  thus
reproducing  the  situation  observed  at  the  time  of  the
closure of the aid measures for the preceding periods (28).
For  the  forthcoming  period  2000-2006,  every  effort
should  be  made  to  ensure  that  there 
is  genuinely
meaningful  programming  based  on  a  realistic  timetable.

7.5.
Improved  information  systems  at  the  Commission
and  in  the  Member  States  would  make  it  possible  for  all
the  partners  to  have  a  reliable,  up-to-date  picture  at  any
time  of  the  situation  regarding  the  aid  measures  and  the

(28) Special Reports on the closure of the ERDF aid measures and

of  O5b.

C  347/62

EN

Official  Journal  of  the  European  Communities

16.11.98

projects  receiving  Community  co-financing (29).  One  step
in  the  right  direction  that  has  been  considered  in  the
recent proposals for a regulation for the SFs is to require
implementation  reports  to  be  drawn  up  by  calendar  year
instead  of  by  tranche,  but  this  would  not  suffice  unless
the  data  in  these  reports  were  better  analysed  and  used.
Making  the  SF  financing  more  transparent  should  be  a
priority  aim  and,  to  this  end,  better  use  should  be  made
of  computer  techniques.

7.6.
In  order  to  make  the  rules  for  paying  funds  to
beneficiaries  more  transparent,  the  Commission  should
make  plans  together  with  the  Member  States  for
measures  to  improve  the  financial  channels  and  to
shorten  the  time  taken  for  payments  to  be  made  at  all
levels,  as  already  recommended  by 
the  Financial
Controller  in  his  report  on  this  subject,  drawn  up  in
1992 (30).  If  more  frequent  use  were  made  of  the
accounts  opened  on  behalf  of  the  Commission  with  the
national 
own
resources (31),  this  would  have  the  effect  of  cutting  down
the  number  of  operations  and  intermediaries  involved  in
the  transfers  between  the  Commission  and  the  Member
States.

for  making 

treasuries 

available 

in 

improvement 

7.7.
It is clear from the causes of the delays found in the
use of Community appropriations that there is still room
for 
the  SF  management  systems.
Programming  continues  to  be  weak,  as  do  the  ex  ante
evaluation  and  the  analysis  of  the  feasibility  of  the  aid
measures and their operations and projects. Processing of
the financial data at all levels of management still takes a
long  time.  When  measures  are  being  planned,  the  time
taken  for  implementing  the  various  procedures  needed  is
often  underestimated.  The  Community  management
procedures  are  usually  cumbersome  and  slow  and  they
still  dovetail  poorly  with  the  national  procedures,
especially  at  budgetary 
in  mind  the
shortcomings  that  have  been  found,  the  partnership
should  be  strengthened  and  the  Monitoring  Committees’
role  and  the  way  they  work  should  be  reviewed.

level.  Bearing 

7.8. Despite the shortcomings pointed out in this report,
credit  should  be  given  to  the  Commission  and  to  many
national  administrators  for  the  efforts  they  have  made.
These  efforts  need  to  be  stepped  up,  particularly  in  the
context  of  the  partnership,  in  order  to  improve  the
management  of  the  structural  operations.

This  report  was  adopted  by  the  Court  of  Auditors  in  Luxembourg  at  its  meeting  on  23
September  1998.

For  the  Court  of  Auditors

Bernard  FRIEDMANN

President

(29) Aimed particularly at more precise and more easily accessible
information on the projects that are financed (Annual Report
of the Court of Auditors concerning the financial year 1997,
Chapter  8  relating  to  the  DAS,  paragraph  8.66).

(30) SEC(92)  1912  final  of  5.11.1992.  Final  report  on  the
financial  channels  relating  to  the  transfer  of  Structural  Fund
payments  to  the  Member  States.

(31) Regulation  (EEC,  Euratom)  No  1552/89,  Art.  9.

16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/63

Annual  distribution  of  the  Structural  Fund  and  FIFG  resources  available  for  commitment  for  the  period  1994-1999

Allocation  of  the  Structural  Funds  to  the  existing  Members  States  (at  1992  prices  and  in  Mio  ECU)

Table  1

1994

1995

1996

1997

1998

1999

1994-1999

Objective  1

13 220

14 300

15 330

16 396

17 820

19 280

96 346

Objectives  2-5b

6 915

7 180

7 410

7 630

7 870

8 120

45 125

Total

20 135

21 480

22 740

24 026

25 690

27 400

141 471

Overall (in %)

14,23 %

15,18 %

16,07 %

16,98 %

18,16 %

19,37 % 100,00 %

Objective  1  (in %)

13,72 %

14,84 %

15,91 %

17,02 %

18,50 %

20,01 % 100,00 %

Objectives  2-5b  (in %)

15,32 %

15,91 %

16,42 %

16,91 %

17,44 %

17,99 % 100,00 %

Source:  Conclusions  of  the  Presidency.  Edinburgh  European  Council  of  11-12  December  1992.

Allocation  of  the  Structural  Funds  to  the  new  Member  States  (at  1995  prices  and  in  Mio  ECU)

Objective  1

Objectives  2-5b

Objective  6

Total

1995

1996

1997

1998

1999

1995-1999

32

728

131

891

34

749

138

921

37

765

147

949

39

782

159

980

42

798

166

184

3 822

741

1 006

4 747

Overall (in %)

18,77 %

19,40 %

19,99 %

20,64 %

21,19 %

100,00 %

Objective  1  (in %)

17,39 %

18,48 %

20,11 %

21,20 %

22,83 %

100,00 %

Objectives  2-5b  (in %)

19,05 %

19,60 %

20,02 %

20,46 %

20,88 %

100,00 %

Objective  6  (in %)

17,68 %

18,62 %

19,84 %

21,46 %

22,40 %

100,00 %

Source:  Council  Decision  of  1.1.1995  adapting  the  instruments  relating  to  the  accession  of  new  Member  States  (OJ  L  1,  1.1.1995,  p.  1).

Comparison  between  resources  available  under  the  CSFs,  for  the  entire  period  1994-1999,  and  the  implementation  by  objective  and  by  Member  State  (EUR  12)

Table  2

Belgium

Denmark

Germany

Greece

Spain

France

Ireland

Italy

Luxembourg Netherlands

Portugal

U.  Kingdom

Total

(Mio  ECU)

748,5
457,8
349,7
267,6
46,7 %

35,7 %

76,4 %

58,4 %

13 985,3
8 554,0
8 447,3
6 754,6
60,4 %

14 333,9
8 767,2
8 530,0
6 129,8
59,5 %

26 965,8
16 493,4
17 634,6
13 553,2
65,4 %

2 245,4
1 373,4
967,9
821,3
43,1 %

5 762,3
3 524,4
3 612,6
3 192,3
62,7 %

15 236,2
9 319,1
8 608,2
5 072,9
56,5 %

153,8
94,1
57,7
51,1
37,5 %

14 333,9
8 767,2
9 870,6
7 952,4
68,9 %

2 419,7
1 480,0
1 490,9
1 117,2
61,6 %

96 184,9
58 830,5
59 569,5
44 912,5
61,9 %

48,3 %

42,8 %

50,3 %

36,6 %

55,4 %

33,3 %

33,3 %

55,5 %

46,2 %

46,7 %

98,8 %

97,3 % 106,9 %

70,5 % 102,5 %

92,4 %

61,3 % 112,6 % 100,7 % 101,3 %

79,0 %

69,9 %

82,2 %

59,8 %

90,6 %

54,4 %

54,4 %

90,7 %

75,5 %

76,3 %

349,4
222,2
226,0
152,4
64,7 %

123,0
78,0
86,1
63,4
70,0 %

1 604,8
1 019,2
1 056,9
720,2
65,9 %

2 474,8
1 571,5
1 263,5
842,0
51,1 %

3 866,4
2 454,9
2 320,3
1 685,3
60,0 %

1 498,2
951,3
936,3
524,8

15,4
9,7
15,7
9,2
62,5 % 101,9 %

666,2
420,2
361,6
238,0
54,3 %

4 693,4
2 979,7
2 704,4
2 011,7
57,6 %

15 291,6
9 706,7
8 970,8
6 246,8
58,7 %

43,6 %

51,6 %

44,9 %

34,0 %

43,6 %

35,0 %

59,8 %

35,7 %

42,9 %

40,9 %

101,7 % 110,4 % 103,7 %

80,4 %

94,5 %

98,4 % 160,6 %

86,1 %

90,8 %

92,4 %

68,6 %

81,3 %

70,7 %

53,6 %

68,7 %

55,2 %

94,3 %

56,6 %

67,5 %

64,4 %

476,5
303,1
297,8

308,4
196,2
189,7

1 990,0
1 265,7
1 038,9

1 888,6
1 201,2
1 135,9

3 282,2
2 087,6
1 706,1

1 757,4
1 117,8
1 085,8

23,6
15,0
14,1

1 105,7
703,3
680,9

3 460,5
2 201,0
2 603,1

14 292,9
9 090,9
8 752,2

235,7

170,5

874,1

882,1

1 361,8

498,8

13,3

583,1

1 688,8

6 308,2

62,5 %

61,5 %

52,2 %

60,1 %

52,0 %

61,8 %

59,7 %

61,6 %

75,2 %

61,2 %

Objective  1 1994-1999
Objective  1 1994-1997
Commitments  1994-1997
Payments  1994-1997
Commitments  1994-1997/Estimates
1994-1999
Payments  1994-1997/Estimates
1994-1999
Commitments  1994-1997/Estimates
1994-1997
Payments  1994-1997/Estimates
1994-1997

Objective  2 1994-1999
Objective  2 1994-1997
Commitments  1994-1997
Payments  1994-1997
Commitments  1994-1997/Estimates
1994-1999
Payments  1994-1997/Estimates
1994-1999
Commitments  1994-1997/Estimates
1994-1997
Payments  1994-1997/Estimates
1994-1997

Objectives  3  and  4 1994-1999
Objectives  3  and  4 1994-1997
Commitments  1994-1997  Objectives
3  +  4
Payments  1994-1997
Objectives  3  +  4
Commitments  1994-1997/Estimates
1994-1999

C

3
4
7
6
4

/

E
N

O

f
f
i
c
i
a
l

J
o
u
r
n
a
l

o
f

t
h
e

E
u
r
o
p
e
a
n

C
o
m
m
u
n
i
t
i
e
s

1
6
.
1
1
.
9
8

 
 
 
 
 
 
Belgium

Denmark

Germany

Greece

Spain

France

Ireland

Italy

Luxembourg Netherlands

Portugal

U.  Kingdom

Total

(Mio  ECU)

49,5 %

55,3 %

43,9 %

46,7 %

41,5 %

28,4 %

56,3 %

52,7 %

48,8 %

44,1 %

98,3 %

96,7 %

82,1 %

94,6 %

81,7 %

97,1 %

93,9 %

96,8 %

118,3 %

96,3 %

77,8 %

86,9 %

69,1 %

73,4 %

65,2 %

44,6 %

88,5 %

82,9 %

76,7 %

69,4 %

174,0

130,0

1.093,3

333,7

1 783,2

696,1

39,9

120,8

369,6

4 740,6

116,1

86,6

726,2

221,0

1 184,6

462,4

26,5

79,5

245,5

3 148,3

105,4

80,0

77,8

61,8

683,9

533,2

60,6 %

59,8 %

62,6 %

165,2

142,6

1 123,6

817,1

49,5 %

63,0 %

372,1

239,5

16,5

15,2

39,3

21,0

53,5 %

41,4 %

32,6 %

126,6

2 710,4

97,2

2 007,6

34,2 %

57,2 %

46,0 %

47,6 %

48,8 %

42,7 %

45,8 %

34,4 %

38,0 %

17,4 %

26,3 %

42,3 %

90,8 %

89,8 %

94,2 %

74,8 %

94,8 %

80,5 %

62,3 %

49,5 %

51,6 %

86,1 %

68,9 %

71,4 %

73,4 %

64,5 %

69,0 %

51,8 %

57,3 %

26,4 %

39,6 %

63,8 %

25,1

143,2

76,3

122,5

194,4

16,6

95,1

50,5

81,1

128,9

24,7

19,6

69,9

58,2

37,8

28,9

82,3

65,9

94,9

66,4

137,6

91,3

47,6

25,6

1,1

0,9

1,1

0,3

47,7

31,6

15,6

12,7

90,8

838,8

60,1

556,1

45,4

40,9

419,2

318,5

98,6 %

48,8 %

49,5 %

67,2 %

48,8 %

34,6 %

98,0 %

32,6 %

50,0 %

50,0 %

78,2 %

40,7 %

37,8 %

53,8 %

34,2 %

18,6 %

29,4 %

26,5 %

45,0 %

38,0 %

149,0 %

73,5 %

74,7 %

101,5 %

73,6 %

52,2 % 120,1 %

49,3 %

75,5 %

75,4 %

118,3 %

61,2 %

57,1 %

81,2 %

51,5 %

28,0 %

36,0 %

40,1 %

68,0 %

57,3 %

Payments  1994-1997/Estimates
1994-1999

Commitments  1994-1997/Estimates
1994-1997

Payments  1994-1997/Estimates
1994-1997

Objective  5a  (agriculture  sector)
1994-1999

Objective  5a  (agriculture  sector)
1994-1997

Commitments  1994-1997

Payments  1994-1997

Commitments  1994-1997/Estimates
1994-1999

Payments  1994-1997/Estimates
1994-1999

Commitments  1994-1997/Estimates
1994-1997

Payments  1994-1997/Estimates
1994-1997

Objective  5a  (fisheries  sector)
1994-1999

Objective  5a  (fisheries  sector)
1994-1997

Commitments  1994-1997

Payments  1994-1997

Commitments  1994-1997/Estimates
1994-1999

Payments  1994-1997/Estimates
1994-1999

Commitments  1994-1997/Estimates
1994-1997

Payments  1994-1997/Estimates
1994-1997

.

1
6
1
1
9
8

.

E
N

O

f
f
i
c
i
a
l

J
o
u
r
n
a
l

o
f

t
h
e

E
u
r
o
p
e
a
n

C
o
m
m
u
n
i
t
i
e
s

C

3
4
7
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6
5

 
 
 
 
 
 
Belgium

Denmark

Germany

Greece

Spain

France

Ireland

Italy

Luxembourg Netherlands

Portugal

U.  Kingdom

Total

(Mio  ECU)

78,9
51,2
24,9
14,8
31,6 %

55,3
35,9
24,2
20,5
43,7 %

1 257,3
816,0
719,3
531,1
57,2 %

680,4
441,6
425,7
331,2
62,6 %

2 293,3
1 488,3
1 170,2
870,2
51,0 %

923,3
599,2
278,8
136,4
30,2 %

6,1
4,0
2,6
2,0
42,8 %

153,7
99,8
62,3
44,5
40,5 %

837,2
543,3
358,0
250,9
42,8 %

6 285,7
4 079,1
3 065,9
2 201,6
48,8 %

18,7 %

37,1 %

42,2 %

48,7 %

37,9 %

14,8 %

32,6 %

29,0 %

30,0 %

35,0 %

48,6 %

67,4 %

88,1 %

96,4 %

78,6 %

46,5 %

65,9 %

62,4 %

65,9 %

75,2 %

28,8 %

57,1 %

65,1 %

75,0 %

58,5 %

22,8 %

50,3 %

44,6 %

46,2 %

54,0 %

1 852,4
1 167,0
1 028,6
770,0
55,5 %

759,9
491,8
447,6
374,5
58,9 %

20 007,0
12 431,6
11 983,9
9 442,1
59,9 %

14 333,9
8 767,2
8 530,0
6 129,8
59,5 %

32 465,8
20 009,8
20 707,2
15 816,9
63,8 %

13 664,9
8 717,7
7 383,0
5 622,2
54,0 %

5 762,3
3 524,4
3 612,6
3 192,3
62,7 %

20 248,8
12 541,1
11 328,9
6 497,9
55,9 %

86,1
56,1
50,0
40,0
58,1 %

2 247,9
1 428,5
1 217,4
950,4
54,2 %

14 333,9
8 767,2
9 870,6
7 952,4
68,9 %

11 871,2 137 634,5
85 411,6
83 488,2
61 995,3
60,7 %

7 509,6
7 328,4
5 206,7
61,7 %

41,6 %

49,3 %

47,2 %

42,8 %

48,7 %

41,1 %

55,4 %

32,1 %

46,4 %

42,3 %

55,5 %

43,9 %

45,0 %

88,1 %

91,0 %

96,4 %

97,3 % 103,5 %

84,7 % 102,5 %

90,3 %

89,1 %

85,2 % 112,6 %

97,6 %

97,7 %

66,0 %

76,1 %

76,0 %

69,9 %

79,0 %

64,5 %

90,6 %

51,8 %

71,3 %

66,5 %

90,7 %

69,3 %

72,6 %

Objective  5b  1994-1999
Objective  5b  1994-1997
Commitments  1994-1997
Payments  1994-1997
Commitments  1994-1997/Estimates
1994-1999
Payments  1994-1997/Estimates
1994-1999
Commitments  1994-1997/Estimates
1994-1997
Payments  1994-1997/Estimates
1994-1997

Total  Estimates  1994-1999
Total  Estimates  1994-1997
Commitments  1994-1997
Payments  1994-1997
Commitments  1994-1997/Estimates
1994-1999
Payments  1994-1997/Estimates
1994-1999
Commitments  1994-1997/Estimates
1994-1997
Payments  1994-1997/Estimates
1994-1997

Source:  Drawn  up  by  the  European  Court  of  Auditors  on  the  basis  of  SINCOM.

C

3
4
7
6
6

/

E
N

O

f
f
i
c
i
a
l

J
o
u
r
n
a
l

o
f

t
h
e

E
u
r
o
p
e
a
n

C
o
m
m
u
n
i
t
i
e
s

1
6
.
1
1
.
9
8

 
 
 
 
 
 
16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/67

Comparison between the resources available under the CSFs, for the entire period, and the implementation
by  objective  and  by  Member  State  (EUR  3)

Table  3

Austria

Finland

Sweden

Total

(Mio  ECU)

Objective  1  1995-99

Objective  1  1995-97

Commitments  1995-97

Payments  1995-97

Commitments  1995-97/Estimates  1995-99

Payments  1995-97/Estimates  1995-99

Commitments  1995-97/Estimates  1995-97

Payments  1995-97/Estimates  1995-97

Objective  2  1995-99

Objective  2  1995-97

Commitments  1995-97

Payments  1995-97

171,5

93,9

83,76

55,74

48,9 %

32,5 %

89,2 %

59,4 %

104,4

60,9

77,2

57,2

171,5

93,9

83,76

55,74

48,9 %

32,5 %

89,2 %

59,4 %

459,1

266,4

292,2

194,0

165,4

96,2

109,3

73,3

189,3

109,3

105,8

63,6

Commitments  1995-97/Estimates  1995-99

73,9 %

66,1 %

55,9 %

63,6 %

Payments  1995-97/Estimates  1995-99

54,8 %

44,3 %

33,6 %

42,3 %

Commitments  1995-97/Estimates  1995-97

126,6 % 113,6 %

96,8 % 109,7 %

Payments  1995-97/Estimates  1995-97

93,9 %

76,2 %

58,2 %

72,8 %

Objectives  3  and  4  1995-99

Objectives  3  and  4  1995-97

Commitments  1995-97  Objectives  3  +  4

Payments  1995-97  Objectives  3  +  4

408,3

238,8

298,0

219,0

354,1

218,1

212,7

132,3

537,6

312,6

203,1

123,8

1 300,0

769,4

713,8

475,1

Commitments  1995-97/Estimates  1995-99

73,0 %

60,1 %

37,8 %

54,9 %

Payments  1995-97/Estimates  1995-99

53,6 %

37,4 %

23,0 %

36,5 %

Commitments  1995-97/Estimates  1995-97

124,8 %

97,6 %

65,0 %

92,8 %

Payments  1995-97/Estimates  1995-97

91,7 %

60,7 %

39,6 %

61,8 %

Objective  5a  (agricultural  sector)  1995-99

Objective  5a  (agricultural  sector)  1995-97

Commitments  1995-97

Payments  1995-97

399,0

232,8

207,5

189,1

342,3

198,3

181,9

166,7

173,7

101

54,0

48,7

915,0

532,1

443,5

404,5

Commitments  1995-97/Estimates  1995-99

52,0 %

53,1 %

31,1 %

48,5 %

Payments  1995-97/Estimates  1995-99

47,4 %

48,7 %

28,1 %

44,2 %

Commitments  1995-97/Estimates  1995-97

89,1 %

91,7 %

53,5 %

83,3 %

Payments  1995-97/Estimates  1995-97

81,2 %

84,0 %

48,2 %

76,0 %

C  347/68

EN

Official  Journal  of  the  European  Communities

16.11.98

Objective  5a  (fisheries  sector)  1995-99

Objective  5a  (fisheries  sector)  1995-97

Commitments  1995-97

Payments  1995-97

Austria

Finland

Sweden

Total

(Mio  ECU)

2,1

1,2

2,0

1,0

23,8

13,6

23,0

18,4

41,4

24,0

40,2

32,0

67,2

38,9

65,2

51,4

Commitments  1995-97/Estimates  1995-99

96,8 %

96,7 %

97,2 %

97,0 %

Payments  1995-97/Estimates  1995-99

48,4 %

77,3 %

77,4 %

76,5 %

Commitments  1995-97/Estimates  1995-97

162,7 % 168,9 % 167,2 % 167,7 %

Payments  1995-97/Estimates  1995-97

81,3 % 135,1 % 133,1 % 132,2 %

Objective  5b  1995-99

Objective  5b  1995-97

Commitments  1995-97

Payments  1995-97

424,9

247,9

179,6

137,2

201

104,5

85,9

54,3

142,7

83,0

69,5

40,0

768,5

435,4

335,1

231,5

Commitments  1995-97/Estimates  1995-99

42,3 %

42,8 %

48,7 %

43,6 %

Payments  1995-97/Estimates  1995-99

32,3 %

27,0 %

28,0 %

30,1 %

Commitments  1995-97/Estimates  1995-97

72,5 %

82,3 %

83,8 %

77,0 %

Payments  1995-97/Estimates  1995-97

55,3 %

52,0 %

48,2 %

53,2 %

Objective  6  1995-99

Objective  6  1995-97

Commitments  1995-97

Payments  1995-97

Commitments  1995-97/Estimates  1995-99

Payments  1995-97/Estimates  1995-99

Commitments  1995-97/Estimates  1995-97

Payments  1995-97/Estimates  1995-97

475,9

263,9

272,3

163,7

260,7

146,0

80,1

60,0

736,6

410,0

352,4

223,8

57,2 %

30,7 %

47,8 %

34,4 %

23,0 %

30,4 %

103,2 %

54,8 %

86,0 %

62,0 %

41,1 %

54,6 %

Total  Estimates  1995-99

Total  Estimates  1995-97

Commitments  1995-97

Payments  1995-97

1 510,2

1 562,5

1 345,4

4 417,9

875,5

848,1

659,2

894,6

885,1

608,6

775,9

552,7

368,1

2 546,1

2 285,9

1 636,0

Commitments  1995-97/Estimates  1995-99

56,2 %

56,6 %

41,1 %

51,7 %

Payments  1995-97/Estimates  1995-99

43,7 %

39,0 %

27,4 %

37,0 %

Commitments  1995-97/Estimates  1995-97

96,9 %

98,9 %

71,2 %

89,8 %

Payments  1995-97/Estimates  1995-97

75,3 %

68,0 %

47,4 %

64,3 %

Source:  Drawn  up  by  the  European  Court  of  Auditors  on  the  basis  of  SINCOM.

16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/69

Comparison  between  the  resources  available  under  the  Community  initiatives,  for  the  entire  period  1994-1999,  and  the  budgetary
implementation  by  initiative  and  by  year

Table  4

Year  of  the  commitment

(Mio  ECU)

1994

1995

1996

1997

1994-1997

1998

1999

Grand  Total

Interreg  II

Estimates

Commitments  1994-1997

Payments  1994-1997

438,9

0,0

0,0

508,0

557,9

227,7

523,0

752,0

423,5

551,8

2 021,6

747,4

793,3

458,6

1 768,5

357,6

1 008,8

Commitments/Estimates

0,0 % 58,9 % 89,1 % 87,5 % 87,5 %

Payments/Estimates

0,0 % 24,1 % 44,3 % 49,9 % 49,9 %

3 562,3

1 768,5

1 008,8

49,6 %

28,3 %

Leader  II

Estimates

Commitments  1994-1997

Payments  1994-1997

217,0

0,3

0,0

244,9

468,5

132,7

257,9

251,7

133,6

273,9

157,8

104,1

993,8

878,3

370,4

Commitments/Estimates

0,1 % 101,5 % 100,1 % 88,4 % 88,4 %

Payments/Estimates

0,0 % 28,7 % 37,0 % 37,3 % 37,3 %

379,2

404,2

1 777,2

878,3

370,4

49,4 %

20,8 %

ADAPT

Estimates

Commitments  1994-1997

Payments  1994-1997

207,9

0,0

0,0

231,7

307,7

152,6

244,9

222,4

87,0

260,9

125,4

147,9

945,3

655,5

387,5

Commitments/Estimates

0,0 % 70,0 % 77,5 % 69,3 % 69,3 %

Payments/Estimates

0,0 % 34,7 % 35,0 % 41,0 % 41,0 %

339,8

361,4

1 646,4

655,5

387,5

39,8 %

23,5 %

SME

Estimates

Commitments  1994-1997

Payments  1994-1997

147,0

0,0

0,0

158,8

203,5

67,7

176,9

181,9

88,7

190,0

133,3

123,6

672,7

518,8

280,1

Commitments/Estimates

0,0 % 66,6 % 79,9 % 77,1 % 77,1 %

Payments/Estimates

0,0 % 22,1 % 32,4 % 41,6 % 41,6 %

203,5

216,2

1 092,5

URBAN

Estimates

Commitments  1994-1997

Payments  1994-1997

107,1

0,0

0,0

121,7

157,4

58,1

124,2

215,0

108,1

129,5

118,1

75,6

482,6

490,5

241,9

199,5

212,5

Commitments/Estimates

0,0 % 68,8 % 105,5 % 101,6 % 101,6 %

Payments/Estimates

0,0 % 25,4 % 47,1 % 50,1 % 50,1 %

PESCA

Estimates

Commitments  1994-1997

Payments  1994-1997

38,1

23,7

11,8

42,1

29,4

5,3

44,6

134,6

20,6

47,4

21,5

33,8

172,2

209,1

71,6

62,7

66,6

Commitments/Estimates

62,2 % 66,2 % 150,4 % 121,4 % 121,4 %

Payments/Estimates

31,1 % 21,4 % 30,3 % 41,6 % 41,6 %

Rechar  II

Estimates

Commitments  1994-1997

Payments  1994-1997

95,1

0,0

0,0

102,7

172,5

75,6

108,6

119,9

61,6

116,7

113,3

75,4

423,1

405,8

212,7

20,3

21,6

Commitments/Estimates

0,0 % 87,2 % 95,5 % 95,9 % 95,9 %

Payments/Estimates

0,0 % 38,2 % 44,8 % 50,3 % 50,3 %

518,8

280,1

47,5 %

25,6 %

894,5

490,5

241,9

54,8 %

27,0 %

301,5

209,1

71,6

69,4 %

23,7 %

465,0

405,8

212,7

87,3 %

45,7 %

C  347/70

EN

Official  Journal  of  the  European  Communities

16.11.98

(Mio  ECU)

Year  of  the  commitment

1994

1995

1996

1997

1994-1997

1998

1999

Grand  Total

Resider  II

Estimates

Commitments  1994-1997

Payments  1994-1997

120,9

4,3

1,3

131,5

172,8

77,0

139,1

134,4

79,6

179,6

105,1

62,1

571,0

416,6

220,0

19,3

20,5

Commitments/Estimates

3,5 % 70,2 % 79,6 % 73,0 % 73,0 %

Payments/Estimates

1,1 % 31,0 % 40,3 % 38,5 % 38,5 %

RETEX

Estimates

Commitments  1994-1997

Payments  1994-1997

122,7

0,3

0,1

134,5

164,8

75,4

139,9

154,4

67,8

148,2

85,8

56,8

545,4

405,3

200,1

30,9

32,9

Commitments/Estimates

0,2 % 64,2 % 80,5 % 74,3 % 74,3 %

Payments/Estimates

0,1 % 29,4 % 36,1 % 36,7 % 36,7 %

610,9

416,6

220,0

68,2 %

36,0 %

609,2

405,3

200,1

66,5 %

32,8 %

Emploi

Estimates

Commitments  1994-1997

Payments  1994-1997

220,7

201,2

100,6

256,9

107,7

53,6

262,5

263,1

170,3

294,8

246,6

866,8

571,2

277,6

1 017,7

407,6

433,1

1 858,5

Commitments/Estimates

91,2 % 64,7 % 77,3 % 85,2 % 85,2 %

Payments/Estimates

45,6 % 32,3 % 43,9 % 56,1 % 56,1 %

Konver

Estimates

Commitments  1994-1997

Payments  1994-1997

125,5

0,0

0,0

135,5

238,2

87,3

138,8

133,0

95,1

147,2

191,4

68,7

547,0

562,7

251,1

91,0

96,8

Commitments/Estimates

0,0 % 91,3 % 92,9 % 102,9 % 102,9 %

Payments/Estimates

0,0 % 33,5 % 45,6 % 45,9 % 45,9 %

REGIS  II

Estimates

Commitments  1994-1997

Payments  1994-1997

85,9

0,0

0,0

92,7

58,8

22,0

99,1

158,0

135,6

105,3

90,6

55,8

383,0

307,4

213,4

112,4

119,6

Commitments/Estimates

0,0 % 32,9 % 78,1 % 80,3 % 80,3 %

Payments/Estimates

0,0 % 12,3 % 56,7 % 55,7 % 55,7 %

PEACE

Estimates

Commitments  1994-1997

Payments  1994-1997

Commitments/Estimates

Payments/Estimates

0,0

0,0

0,0

66,0

27,4

13,7

118,0

119,0

95,6

41,7

53,3

81,2

303,1

176,3

136,5

41,5 % 66,8 % 58,1 % 58,1 %

20,7 % 30,1 % 45,0 % 45,0 %

866,8

571,2

46,6 %

30,7 %

734,9

562,7

251,1

76,6 %

34,2 %

615,0

307,4

213,4

50,0 %

34,7 %

303,1

176,3

136,5

58,1 %

45,0 %

Total

Estimates

1 926,8

2 227,0

2 377,5

2 547,2

9 078,6

2 613,6

2 778,8

14 471,1

Commitments  1994-1997

229,7

2 666,7

2 816,0

1 949,1

7 661,5

Payments  1994-1997

113,9

1048,9

1 513,2

1 489,3

4 165,3

Commitments/Estimates

11,9 % 69,7 % 87,5 % 84,4 % 84,4 %

Payments/Estimates

5,9 % 28,0 % 41,0 % 45,9 % 45,9 %

7 661,5

4 165,3

52,9 %

28,8 %

Source:  Drawn  up  by  the  European  Court  of  Auditors  on  the  basis  of  SINCOM.

16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/71

Budgetary  implementations  of  the  structural  measures  during  the  financial  years  1994-1997 (1)

Table  5

Final  budget
after  SAB  and
transfers

Implemen-
tation

Implemen-
tation  rate  of
final  budget
(%)

Amount

(Mio  ECU)

Appropriations  cancelled  at
year-end

(a)

(b)

(c)

(d)

1994  COMMITMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90

Cohesion  Fund

1995  COMMITMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90

Cohesion  Fund
EEA  mechanism

1996  COMMITMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90

Cohesion  Fund
EEA  mechanism

1997  COMMITMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90

Cohesion  Fund
EEA  mechanism

3 301,5
379,9
9 769,4
5 841,2
1 949,1
305,9

3 300,4
379,8
9 727,7
5 564,3
251,9
244,4

Sub-total  ‘Structural  Funds’

Total  structural  measures

21 547,0
1 853,1
23 400,1

19 468,5
1 853,1
21 321,6

3 374,1
451,3
10 684,4
6 710,7
2 915,8
271,8

24 408,1
2 152,0
89,8
26 649,9

3 772,0
450,4
11 883,7
7 150,1
2 988,5
342,0

26 587,4
2 444,0
108,0
29 139,4

4 026,1
490,7
12 989,7
7 639,1
3 173,4
305,7

28 624,7
2 749,0
108,0
31 481,7

3 348,3
451,2
10 566,1
5 125,3
2 666,7
111,9

22 269,5
2 152,0
89,8
24 511,3

3 772,0
337,2
11 862,5
7 150,1
2 819,4
199,4

26 141,2
2 443,9
87,1
28 672,2

4 026,1
369,0
12 983,1
7 639,1
1 949,1
263,9

27 230,3
2 748,9
102,5
30 081,7

Sub-total  ‘Structural  Funds’

Total  structural  measures

Sub-total  ‘Structural  Funds’

Total  structural  measures

Sub-total  ‘Structural  Funds’

Total  structural  measures

99,97
99,97
99,57
95,26
12,92
79,90

90,35
100,00
91,12

99,24
99,99
98,89
76,37
91,46
41,17

91,24
100,00
100,00
91,97

100,00
74,87
99,82
100,00
94,34
58,30

98,32
100,00
80,63
98,40

100,00
75,20
99,95
100,00
61,42
86,33

95,13
100,00
94,92
95,55

1,1
0,1
41,7
272,3
1 383,7
40,5

1 739,4
0,1
1 739,5

25,8
0,0
118,3
1 581,1
228,7
114,0

2 068,0
0,0
0,0
2 068,0

0,0
113,2
21,2
0,0
169,2
142,6

441,5
0,1
20,9
462,5

0,0
121,7
6,6
0,0
1 224,3
41,3

1 393,9
0,1
5,5
1 399,5

(1)  In  its  Annual  Reports  the  Court  presents  more  detailed  tables  showing  the  budgetary  implementation  of  structural  measures.

%
(d)/(a)

(e)

0,03
0,03
0,43
4,66
70,99
13,24

8,07
0,00
7,43

0,76
0,01
1,11
23,56
7,84
41,95

8,47
0,00
0,00
7,76

0,00
25,13
0,18
0,00
5,66
41,70

1,66
0,00
19,37
1,59

0,00
24,80
0,05
0,00
38,58
13,51

4,87
0,00
5,08
4,45

C  347/72

EN

Official  Journal  of  the  European  Communities

Final  budget
after  SAB  and
transfers

Implemen-
tation

Implemen-
tation  rate  of
final  budget
(%)

16.11.98

(Mio  ECU)

Appropriations  cancelled  at
year-end

Amount

1994  PAYMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90
Others

Cohesion  Fund

1995  PAYMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90
Others

Cohesion  Fund
EEA  mechanism

1996  PAYMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90
Others

Cohesion  Fund
EEA  mechanism

1997  PAYMENTS

EAGGF-Guidance
FIFG  (fisheries)
ERDF
ESF
Community  initiatives
Transitional  measures,  etc.
Regulation  (EEC)  No  3575/90
Others

Cohesion  Fund
EEA  mechanism

Sub-total  ‘Structural  Funds’

Total  structural  measures

Sub-total  ‘Structural  Funds’

Total  structural  measures

Sub-total  ‘Structural  Funds’

Total  structural  measures

Sub-total  ‘Structural  Funds’

Total  structural  measures

(a)

(b)

(c)

(d)

2 778,9
537,0
8 087,4
5 454,1
2 059,4
487,0
416,0
174,1
19 993,9
1 743,4
21 737,3

2 935,2
518,1
9 627,2
5 851,6
2 291,5
386,7
165,1
106,5
21 881,9
1 750,0
89,8
23 721,7

3 859,4
545,1
10 663,1
6 035,9
2 115,2
314,7
148,7
49,2
23 731,3
1 919,3
108,0
25 758,6

3 580,0
486,9
11 522,6
6 143,4
1 858,6
267,3
87,3
49,9
23 996,0
2 326,0
102,5
26 424,5

2 498,9
395,0
6 410,8
4 144,8
849,2
319,7
176,8
55,7
14 850,9
916,0
15 767,0

2 530,6
248,1
8 373,6
4 734,1
1 337,8
193,8
36,3
48,5
17 502,8
1 699,3
89,8
19 292,0

3 360,3
421,6
10 610,3
6 035,9
1 691,4
188,5
119,5
40,0
22 467,5
1 872,2
87,1
24 426,8

3 580,0
486,9
11 521,4
6 143,4
1 677,3
171,4
41,2
10,9
23 632,5
2 323,0
102,5
26 058,0

89,92
73,56
79,27
75,99
41,24
65,65
42,50
32,00
74,28
52,54
72,53

86,21
47,87
86,98
80,90
58,38
50,14
21,99
45,55
79,99
97,11
100,00
81,33

87,07
77,34
99,50
100,00
79,96
59,90
80,36
81,39
94,67
97,55
80,63
94,83

100,00
100,00
99,99
100,00
90,25
64,12
47,19
21,91
98,49
99,87
100,00
98,61

223,1
142,0
1 676,6
1 099,7
1 025,9
157,3
126,1
51,9
4 502,6
827,4
5 330,0

404,6
270,1
1 253,6
1 113,1
953,7
192,8
128,8
58,0
4 374,7
50,7
0,0
4425,4

499,1
123,5
52,8
0,0
423,8
126,2
0,0
2,0
1 227,4
47,1
20,9
1 295,5

0,0
0,0
1,2
0,0
181,3
95,9
46,1
38,9
363,4
3,0
0,0
366,4

%
(d)/(a)

(e)

8,03
26,44
20,73
20,16
49,82
32,30
30,31
29,83
22,52
47,46
24,52

13,79
52,13
13,02
19,02
41,62
49,86
78,01
54,45
19,99
2,89
0,00
18,66

12,93
22,66
0,50
0,00
20,04
40,10
0,00
4,03
5,17
2,45
19,37
5,03

0,00
0,00
0,01
0,00
9,75
35,88
52,81
78,09
1,51
0,13
0,00
1,39

16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/73

Table  6

Financial  perspective  —  Heading  2

(1 000  ECU)

Structural  Funds

1994

1995

1996

1997

21 323 000

19 245 723

2 077 277

339 147

1 738 130

1.  Budgetary  allocation  for  the  year

2.  Implementation

3.  Unimplemented  appropriations  (1-2)

4.  Appropriations  carried  forward  to  n+1

5.  Cancelled  appropriations  (3-4)

6.  Appropriations  carried  over  from  n-1  to  n

7.  Implementation  of  the  appropriations

carried  forward

8.  Unimplemented  carried-over  appropriations

9.  Decom.,  net  of  amounts  made  available

again

24 069 000

21 937 911

2 131 089

70 629

2 060 460

339 147

331 601

7 546

5 445

26 579 000

26 078 201

500 799

4 648

496 151

70 629

63 038

7 591

41 606

28 620 000

27 226 145

1 393 855

1 393 855

4 648

4 648

0

38 970

10.  Total  not  used  (5+8+9)

1 738 130

2 073 451

545 348

1 432 825

Cohesion  fund

1993

1994

1995

1996

1997

1.  Budgetary  allocation  for  the  year

1 565 000

1 853 000

2 152 000

2 444 000

2 749 000

2.  Implementation

1 564 645

1 852 963

2 151 972

2 443 933

2 748 925

355

136

219

3.  Unimplemented  appropriations  (1-2)

4.  Appropriations  carried  forward  to

n+1

5.  Cancelled  appropriations  (3-4)

6.  Appropriations  carried  over  from

n-1  to  n

7.  Implementation  of  the

appropriations  carried  forward

8.  Unimplemented  carried-over

appropriations

9.  Decom.,  net  of  amounts  made

available again

10.  Total  not  used  (5+8+9)

219

37

0

37

136

121

16

5

58

28

0

28

0

0

0

67

0

67

0

0

0

75

0

75

0

0

0

10 489

16 718

100 589

10 517

16 785

100 664

EEA  financial  mechanism

1.  Budgetary  allocation  for  the  year

2.  Implementation

3.  Total  not  used

1995

108 000

90 000

18 000

1996

108 000

87 000

21 000

1997

108 000

102 500

5 500

Structural  measures

1994

1995

1996

1997

1998

1999

Financial perspective

Budgetary allocation

Net  utilisation

Unused  allocation

23 176 000

26 329 000

29 131 000

31 477 000

33 461 000

39 025 000

23 176 000

26 329 000

29 131 000

31 477 000

33 461 000

21 437 812

24 227 032

28 547 867

29 938 011

1 738 188

2 101 968

583 133

1 538 989

Source:  Commission.  Adjustments  to  the  financial  perspective.

C  347/74

EN

Official  Journal  of  the  European  Communities

16.11.98

Impact  of  the  adaptations  of  the  financial  perspective  to  the  conditions  of  implementation

Table  7

Appropriations  for  commitments

(Mio  ECU)

Structural  Funds

1995

1996

1997

1998

1999

1996  adaptation

1997  adaptation

1998  adaptation

1999  adaptation

TOTAL

869

869

380

1 000

−500

869

1 249

500

693

1 045

1 433

3 171

Cohesion  Fund

1995

1996

1997

1998

1999

1997  adaptation

1998  adaptation

1999  adaptation

TOTAL

11

11

17

101

118

The  Commission  proposed  an  adaptation  of  5  Mio  ECU  under  the  EEA  financial  mechanism.

Appropriations  for  payments

Structural  measures

1995

1996

1997

1998

1999

1996  adaptation

1997  adaptation

1998  adaptation

1999  adaptation

TOTAL

935

696

186

434

633

−300

173

632

300

300

935

882

767

1 405

Table  8

Comparison  between  the  initial  financial  plans  and  those  in  effect  at  31.12.1997  for  all  the  aid  measures  under  Objective  2  (period  1994  to  1996)

Initial  financial  plans

Current  financial  plans

Difference  between  the  financial  plans

Ratio  plans  in  effect/initial  plans

Total  SF

ERDF

ESF

Total  SF

ERDF

ESF

Total  SF

ERDF

ESF

Total  SF

ERDF

ESF

(ECU)

Belgium

Denmark

Germany

Spain

France

Italy

Luxembourg

1994
1995
1996
Total

1994
1995
1996
Total

1994
1995
1996
Total

1994
1995
1996
Total

1994
1995
1996
Total

1994
1995
1996
Total

1994
1995
1996
Total

51 000 250
53 000 250
55 999 500
160 000 000

41 440 500
43 068 500
45 511 500
130 020 500

9 559 750
9 931 750
10 488 000
29 979 500

4 526 261
10 785 161
118 218 058
133 529 480

1 214 500
5 199 971
104 208 719
110 623 190

3 311 761
5 585 190
14 009 339
22 906 290

−46 473 989
−42 215 089
62 218 558
−26 470 520

−40 226 000
−37 868 529
58 697 219
−19 397 310

17 796 000
18 565 000
19 639 000
56 000 000

14 051 000
14 657 000
15 502 000
44 210 000

3 745 000
3 908 000
4 137 000
11 790 000

1 553 000
21 990 000
30 560 000
54 103 000

1 500 000
19 731 000
22 511 000
43 742 000

53 000
2 259 000
8 049 000
10 361 000

−16 243 000
3 425 000
10 921 000
−1 897 000

−12 551 000
5 074 000
7 009 000
−468 000

−6 247 989
−4 346 560
3 521 339
−7 073 210

−3 692 000
−1 649 000
3 912 000
−1 429 000

233 210 000
243 011 000
256 781 000
733 002 000

164 000 000
170 341 000
179 341 000
513 682 000

69 210 000
72 670 000
77 440 000
219 320 000

25 271 004
105 609 000
572 498 000
703 378 004

13 230 004
57 753 000
409 976 000
480 959 004

12 041 000 −207 938 996 −150 769 996
47 856 000 −137 402 000 −112 588 000
230 635 000
315 717 000
−32 722 996
−29 623 996

162 522 000
222 419 000

−57 169 000
−24 814 000
85 082 000
3 099 000

360 000 312
373 999 614
395 999 288
1 129 999 214

277 100 000
288 000 000
305 000 000
870 100 000

82 900 312
85 999 614
90 999 288
259 899 214

205 203 512
262 646 028
522 127 158
989 976 699

167 146 973
201 164 999
413 071 672
781 383 644

38 056 539 −154 796 800 −109 953 027
−86 835 001
61 481 029 −111 353 586
108 071 672
109 055 486
126 127 870
−88 716 356
208 593 055 −140 022 515

−44 843 773
−24 518 585
18 056 198
−51 306 159

561 425 401
584 402 499
617 372 097

464 840 201
479 362 500
508 357 299
1 763 199 997 1 452 560 000

108 265 494
164 124 497
96 585 200
105 039 999
219 764 876
289 904 263
109 014 798 1 127 558 014 1 011 424 700
310 639 997 1 581 586 774 1 339 455 070

55 859 003 −397 300 904 −356 574 707
70 139 387 −294 498 236 −259 597 624
116 133 314
503 067 401
510 185 917
242 131 704 −181 613 223 −113 104 930

−40 726 197
−34 900 612
7 118 516
−68 508 293

210 737 000
219 634 000
253 629 000
684 000 000

166 687 000
173 712 000
201 921 000
542 320 000

44 050 000
45 922 000
51 708 000
141 680 000

11 145 391
19 126 607
493 740 620
524 012 618

10 312 790
12 509 621
377 261 230
400 083 641

832 601 −199 591 609 −156 374 210
6 616 986 −200 507 393 −161 202 379
116 479 390
175 340 230
240 111 620
123 928 977 −159 987 382 −142 236 359

−43 217 399
−39 305 014
64 771 390
−17 751 023

2 000 000
2 000 000
3 000 000
7 000 000

1 723 000
1 723 000
2 583 000
6 029 000

277 000
277 000
417 000
971 000

899 532
517 669
3 920 241
5 337 442

714 997
378 496
3 467 149
4 560 642

184 535
139 173
453 092
776 800

−1 100 468
−1 482 331
920 241
−1 662 558

−1 008 003
−1 344 504
884 149
−1 468 358

−92 465
−137 827
36 092
−194 200

8,87 %
20,35 %

34,64 %
2,93 %
56,24 %
12,07 %
211,11 % 228,97 % 133,57 %
76,41 %
85,08 %

83,46 %

8,73 %

1,42 %
10,68 %
118,45 % 134,62 %
57,80 %
155,61 % 145,21 % 194,56 %
87,88 %
98,94 %

96,61 %

10,84 %
43,46 %

17,40 %
8,07 %
65,85 %
33,90 %
222,95 % 228,60 % 209,87 %
93,63 % 101,41 %

95,96 %

57,00 %
70,23 %

45,91 %
60,32 %
71,49 %
69,85 %
131,85 % 135,43 % 119,84 %
80,26 %
89,80 %

87,61 %

29,23 %
49,61 %

57,83 %
23,29 %
66,77 %
45,85 %
182,64 % 198,96 % 106,53 %
77,95 %
92,21 %

89,70 %

6,19 %
7,20 %

5,29 %
8,71 %

1,89 %
14,41 %
194,67 % 186,84 % 225,26 %
87,47 %
73,77 %

76,61 %

44,98 %
25,88 %

66,62 %
41,50 %
50,24 %
21,97 %
130,67 % 134,23 % 108,66 %
80,00 %
75,65 %

76,25 %

.

1
6
1
1
9
8

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O

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f
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a
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C

3
4
7
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7
5

 
 
 
 
 
 
Initial  financial  plans

Current  financial  plans

Difference  between  the  financial  plans

Ratio  plans  in  effect/initial  plans

Total  SF

ERDF

ESF

Total  SF

ERDF

ESF

Total  SF

ERDF

ESF

Total  SF

ERDF

ESF

(ECU)

Netherlands

United
Kingdom

1994
1995
1996
Total

1994
1995
1996
Total

95 960 000
99 090 000
104 950 000
300 000 000

66 940 000
67 880 000
71 160 000
205 980 000

29 020 000
31 210 000
33 790 000
94 020 000

11 554 342
26 279 204
186 289 913
224 123 459

672 745
10 398 319
132 900 530
143 971 594

10 881 597
15 880 885
53 389 383
80 151 865

−84 405 658
−72 810 796
81 339 913
−75 876 541

−66 267 255
−57 481 681
61 740 530
−62 008 406

681 998 000
710 001 000
750 001 000

511 607 000
532 642 000
562 631 000
2 142 000 000 1 606 880 000

28 794 000
144 811 000
170 391 000
177 359 000
130 003 000
237 928 000
187 370 000 1 634 690 000 1 362 960 000
535 120 000 2 017 429 000 1 521 757 000

116 017 000 −537 187 000 −482 813 000
107 925 000 −472 073 000 −402 639 000
800 329 000
271 730 000
884 689 000
−85 123 000
495 672 000 −124 571 000

−18 138 403
−15 329 115
19 599 383
−13 868 135

−54 374 000
−69 434 000
84 360 000
−39 448 000

Source:  Financial  plans  of  the  Objective  2  SPDs  and  programmes.

12,04 %
26,52 %

37,50 %
1,00 %
50,88 %
15,32 %
177,50 % 186,76 % 158,00 %
85,25 %
69,90 %

74,71 %

21,23 %
33,51 %

68,09 %
5,63 %
60,85 %
24,41 %
217,96 % 242,25 % 145,02 %
92,63 %
94,70 %

94,18 %

C

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4
7
7
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s

1
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.
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8

 
 
 
 
 
 
16.11.98

EN

Official  Journal  of  the  European  Communities

C  347/77

Analysis  of  the  underlying  reasons  for  a  low  rate  of  utilisation  of  Community  appropriations  (replies  to  the  questionnaire)

Table  9

(a)
Number
of
replies

(b)
Very
important

(c)
Important

(b)  +  (c)  /  (a)

(d)
Not  very
important

(e)
Negligible

A.  PROGRAMMING

1.  Difficulties  in  drawing  up  the  SPD/CSF/OP

2.  Delays  in  adoption  of  the  SPD/CSF/OP

3.  Existence  of  suspensive  clauses  and  delays  in  rescinding

them

4. 

Inclusion  of  measures  not  originally  planned

5.  Priority given to completion of aid measures from preceding

periods

6. 

Initial  financing  plan  proved  to  be  over-optimistic

7.  Little  flexibility  in  text  of  the  SPD/CSF/OP

8.  Need  to  make  big  changes  to  the  SPD/CSF/OP/measure,

etc.

9.  Difficulties 

and 

delays 

in 

making 

these

amendments/reprogramming

10.  Cumbersome  nature  of  administrative  procedures:

—  Community  procedures

—  national  procedures

B.  FINANCIAL  CHANNELS

1.  Delays  in  the  arrival  of  Community  funds:

—  in  the  Member  State

—  in  the  region

—  other  level

2.  Concentration  of  the  financial  operations  at  the  year-end:

—  for  the  Community  payments

—  for  the  payments  within  the  Member  State

3.  The  existing  procedures  do  not  enable  advances  to  be  paid
to  final  beneficiaries  or  these  payments  can  be  made  only
on  certain  conditions  likely  to  lengthen  the  procedures

C.  PROCESSING  OF  THE  FINANCIAL  DATA

50

48

41

45

46

47

47

50

48

49

44

42

36

27

35

36

48

4

11

2

4

4

9

2

8

9

6

13

2

5

1

3

3

7

34,00 %

17

13

22

3

9

2

22

12

18

68,75 %

12,20 %

28,89 %

13,04 %

65,96 %

29,79 %

52,00 %

19

58,33 %

27

15

67,35 %

63,64 %

8

8

4

7

7

23,81 %

36,11 %

18,52 %

28,57 %

27,78 %

14

43,75 %

16

8

28

28

32

6

19

11

10

8

8

18

11

10

15

16

17

7

8

4

8

10

14

13

10

8

8

14

12

12

10

10

10

1.  Difficulties  in  gathering  financial  data  from  beneficiaries
(state nature of the difficulty: e.g. lack of separate accounts,
etc.)

50

10

16

52,00 %

13

11

C  347/78

EN

Official  Journal  of  the  European  Communities

16.11.98

2. 

Inadequate  knowledge  by  administrators  of  Community
thresholds  triggering  payments  of  advances  and  balances

3.  Length  of  the  channels  for  sending  financial  data

4.  Length  of  the  procedure  for  sending  payment  claims  to  the

Commission

5.  Slowness  of  the  Commission’s  analysis  of  the  financial

data

D.  BUDGET

1.  Difficulties  in  mobilising  counterpart  funds:

—  national

—  regional/local

—  private

2.  Budgetary  restrictions  not  foreseen  at  the  following  levels:

—  national

—  regional/local

—  other

3.  Variations  in  the  national  currency/ecu  exchange  rate:

—  devaluation

—  revaluation

4.  Slowness  of  the  budgetary 

implementation  procedures

connected  with  the  existence  of  Community  co-financing

5.  Contradictions 

between  Community 

and 

national

procedures/rules  (e.g.  concept  of  commitment)

E. 

IMPLEMENTATION  OF  THE  AID  MEASURE

1.  Difficulties  in  starting  up  the  procedures  for  selecting
measures/projects  before  the  adoption  of  the  Commission
Decision  granting  aid

2. 

Inadequate  awareness  by  aid  beneficiaries  of  Community
rules  and  procedures

3.  Changes 

in 

the 

administrative 

environment 

(e.g.

departmental  reorganisation,  change  in  procedures,  etc.)

4.  Exceptional 

circumstances 

(e.g. 

political 

changes,

privatisations,  natural  catastrophes,  etc.)

5.  Application  of  Article  24  of  Regulation  (EEC)  No  4253/88

(reduction,  suspension  and  cancellation  of  aid)

6.  Difficulties in coordinating several Community and national
the  case  of  multi-fund

(especially 

in 

administrators 
programmes)

(a)
Number
of
replies

(b)
Very
important

(c)
Important

(b)  +  (c)  /  (a)

(d)
Not  very
important

(e)
Negligible

45

47

43

44

37

38

33

39

35

19

36

29

48

50

50

52

51

43

38

48

2

3

4

2

7

4

3

5

1

0

1

0

2

13

5

15,56 %

15

9

11

38,30 %

30,23 %

29,55 %

5

7

32,43 %

28,95 %

10

39,39 %

6

6

1

8

4

10

11

28,21 %

20,00 %

5,26 %

25,00 %

13,79 %

25,00 %

48,00 %

19

23

19

21

12

14

10

15

14

6

5

6

19

13

19

6

11

10

13

13

10

13

14

12

22

19

17

13

8

17

50,00 %

12

13

12

13

6

1

14

11

6

1

50,00 %

47,06 %

27,91 %

5,26 %

15

12

56,25 %

19

14

3

12

10

7

13

28

24

11

16.11.98

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Official  Journal  of  the  European  Communities

C  347/79

(a)
Number
of
replies

(b)
Very
important

(c)
Important

(b)  +  (c)  /  (a)

(d)
Not  very
important

(e)
Negligible

7.  Difficulties 
beneficiaries

in  coordinating  a  high  number  of  aid

49

10

14

48,98 %

14

11

8.  Shortcomings  of  the  Monitoring  Committee:

—  set  up  belatedly  and/or  inadequate  number  of  meetings

—  unsuitable  organisation  in  relation  to  needs  (e.g.  little
the

time 
to  allow 
study  documentation  or 
involvement  of  a  high  number  of  participants,  etc.)

to 

—  length  of  procedures  for  adopting  decisions

9.  Time  taken  for  the  annual/final  report  for

—  the  drawing-up

—  the  forwarding

—  the  approval  by  the  Commission

10.  Difficulties 

encountered 

a
measure/operation/project or aid beneficiary which have the
effect  of  delaying  the  whole  aid  measure

level 

the 

of 

at 

F. 

IMPLEMENTATION  OF  THE  OPERATIONS

1.  Late  start-up  of  projects/operations  connected  with:

—  tendering  procedures  for  public  contracts

—  procedures  to  evaluate  the  environmental  impact

—  results  of  feasibility  studies

—  other  reasons  (e.g.  expropriation,  etc.)

2.  Difficulties  during  the  implementation  (e.g.  unforeseen

technical  difficulties,  bankruptcy,  cost  increase,  etc.)

3.  Slowness  of  the  procedures  to  amend  the
measures/operations/projects,  due  to:
—  delays  in  their  implementation

—  changes  in  priorities

38

39

39

38

36

37

39

41

40

41

28

47

40

35

1

4

7

0

1

2

6

8

4

4

6

1

4

7

4

8

7

6

0

6

7

13,16 %

30,77 %

35,90 %

15,79 %

2,78 %

21,62 %

33,33 %

13

12

9

9

51,22 %

40,00 %

31,71 %

53,57 %

15

34,04 %

11

6

37,50 %

37,14 %

10

9

13

15

18

15

8

8

10

14

4

16

14

12

23

18

12

17

17

14

18

12

14

14

9

15

11

10

C  347/80

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16.11.98

Table  10

List  of  Annexes

ANNEX  I:

Financial  perspective  1993-99  and  allocation  of  Structural  Fund  resources

Table  I.1

Table  I.2

Table  I.3

Table  I.4

Table  I.5

Table  I.6

Table  I.7

Table  I.8

Table  I.9

Annual distribution of the Structural Fund and FIFG resources available for
commitment  for  the  period  1994-1999  (at  1992  prices  and  in  Mio  ECU)

Distribution  of  the  resources  by  Objective  (at  1992  prices  and  in  Mio
ECU)

Distribution  of  resources  by  Objective  and  appropriations  devoted  to
financing  the  Community  Initiatives  (at  1994  prices  and  in  Mio  ECU)

Breakdown  of  the  resources  under  the  CSFs  by  Objective  and  by  Member
State  (at  1994  prices  and  in  Mio  ECU)

Allocation  of  the  Structural  Funds  to  the  new  Member  States  (in  Mio
ECU)

Distribution  of  the  resources  devoted  to  financing  the  Community
Initiatives  (EUR  12)

Details  of  the  distribution  of  the  resources  devoted  to  financing  the
Community  initiatives  (EUR  12)

Result  by  Member  State  and  by  Initiative  of  the  distribution  of  the
resources  devoted  to  financing  the  Community  Initiatives  (EUR  12)

Breakdown  of  the  appropriations  devoted  to  financing  the  Community
Initiatives  for  the  new  Member  States  (in  Mio  ECU  and  at  1995  prices)

ANNEX  II:

Implementation  of  the  Structural  measures  1994-97  by  Objective,  Fund  and  Member
State

Table  II.1

Implementation  of  the  Structural  measures  1994-97

Table  II.2

Implementation  by  Fund  and  by  Member  State

Table  II.3

Implementation  by  Fund  and  by  Objective

Table  II.4

Implementation  by  Objective  and  by  Fund

Table  II.5

Implementation  by  Member  State  and  by  Objective

Table  II.6

Implementation  by  Objective,  Member  State  and  Fund

ANNEX  III:

Details  of  the  budgetary  implementation  1994-97  by  Fund,  Objective,  Member  State  and
year

Table  III.1

Table  III.2

Table  III.3

Table  III.4

Table  III.5

Table  III.6

Table  III.7

Table  III.8

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  1  ERDF

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  1  ESF

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  1  EAGGF

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  1  FIFG

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Total  Objective  1

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  2  ERDF

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  2  ESF

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Total  Objective  2

16.11.98

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C  347/81

Table  III.9

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  3  ESF

Table  III.10

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  4  ESF

Table  III.11

Table  III.12

Table  III.13

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  5a  (in  areas  5b)
EAGGF

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation and by year of commitment — Objective 5a (outside areas
1  and  5b)

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Total  Objective  5a
EAGGF

Table  III.14

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  5a  FIFG

Table  III.15

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  5b  ERDF

Table  III.16

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  5b  ESF

Table  III.17

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  5b  EAGGF

Table  III.18

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Total  Objective  5b

Table  III.19

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  6  ERDF

Table  III.20

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  6  ESF

Table  III.21

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  6  EAGGF

Table  III.22

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Objective  6  FIFG

Table  III.23

Budgetary  implementation  by  country  and  by  year.  Payments  by  year  of
implementation  and  by  year  of  commitment  —  Total  Objective  6

Table  III.24

Budgetary  implementation  by  Community  Initiative  and  by  year

ANNEX  IV:

Comparison between the estimates and the budgetary implementation by Objective, country
and  year

Table  IV.1

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objective  1

Table  IV.2

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objective  2

Table  IV.3

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objectives  3  and  4

Table  IV.4

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objective  5a  (agriculture  sector)

Table  IV.5

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objective  5a  (fisheries  sector)

Table  IV.6

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objective  5b

Table  IV.7

Comparison  between  the  estimates  and  the  budgetary  implementation  by
country  and  year  —  Objective  6

C  347/82

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16.11.98

ANNEX  V:

Comparison between the initial financial plans and those in effect at 31.12.1997 for all aid
measures  under  Objective  2  for  the  period  1994-96

Table  V.1

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Belgium

Table  V.2

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Denmark

Table  V.3

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Germany

Table  V.4

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Spain

Table  V.5

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  France

Table  V.6

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Italy

Table  V.7

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Luxembourg

Table  V.8

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  Netherlands

Table  V.9

Comparison  between  the  initial  financial  plans  and  those  in  effect  at
31.12.1997  for  all  aid  measures  under  Objective  2  —  United  Kingdom

ANNEX  VI:

Implementation of the commitment and payment appropriations for structural measures by
budget  heading  —  Financial  years  1994-1997

Table  VI.1

Implementation  of  the  commitment  appropriations  for  structural  measures
by  budget  heading  —  Financial  year  1994

Table  VI.2

Implementation  of  the  payment  appropriations  for  structural  measures  by
budget  heading  —  Financial  year  1994

Table  VI.3

Implementation  of  the  commitment  appropriations  for  structural  measures
by  budget  heading  —  Financial  year  1995

Table  VI.4

Implementation  of  the  payment  appropriations  for  structural  measures  by
budget  heading  —  Financial  year  1995

Table  VI.5

Implementation  of  the  commitment  appropriations  for  structural  measures
by  budget  heading  —  Financial  year  1996

Table  VI.6

Implementation  of  the  payment  appropriations  for  structural  measures  by
budget  heading  —  Financial  year  1996

Table  VI.7

Implementation  of  the  commitment  appropriations  for  structural  measures
by  budget  heading  —  Financial  year  1997

Table  VI.8

Implementation  of  the  payment  appropriations  for  structural  measures  by
budget  heading  —  Financial  year  1997

16.11.98

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COMMISSION’S  REPLIES

2.  SUMMARY  OF  MAIN  OBSERVATIONS

The  Commission  considers  that  this  summary  of  the
Court’s  observations  may  give  an  unduly  negative
impression of the operations of the Structural Funds. The
Court  concentrates  on  the  inevitable  imperfections  and
for  every
weaknesses  of  Fund  management.  But 
programme  with  problems  there  are  many  which  are
progressing  normally  and  bringing  clear  and  widely
appreciated  benefits.

The  successful  use  of  the  Structural  Funds  requires  the
drawing-up of sensible rules and then a major effort, on a
massive  scale,  of  planning,  programme  formulation,
programme  management  and  monitoring,  budgetary  and
financial  management  and  evaluation.  Financial  targets
have  to  be  met  and,  at  the  same  time,  a  quality  product
has  to  be  ensured.  Large  numbers  of  people  are  involved
in  this  work  at  the  various  levels;  there  are  hundreds  of
programmes  and  hundreds  of  thousands  of  projects.

for 

its  part,  makes 

The  Commission, 
the  best
contribution  it  can  to  managing  the  current  programmes
and to ensuring the presence and proper operation in the
Member  States  of  efficient  management  and  control
systems.  The  Commission  has  also  proposed,  in  the  light
of  experience,  for  the  new  programming  period  starting
in  2000,  major  changes  in  the  rules  in  such  key  areas  as
programming,  partnership,  financial  management  and
control  and  evaluation.  Many  of  these  changes  aim  at
simplification,  decentralisation  and  the  clarification  of
responsibilities  and  are  designed  further  to  increase  the
usefulness  of  Structural  Funds  operations.

2.2. The  low  absorption  rate  of  appropriations  in  1994
and  1995  was  due  to  the  slow  start-up  of  the  new
programming  period.  The  budgetary  execution  of
Community Initiatives was particularly affected, no doubt
mainly  because  of  the  large  number  of  Initiatives  and  of
improved.  The
CI  programmes,  but 
insufficiency  of  1997  payment  appropriations 
is
explained  by  the  fact  that  the  budgetary  authority  had
cut the volume of payment appropriations in comparison
with  the  Commission  proposals  and  did  not  authorise  a
transfer.

it  has  since 

2.3. The  situation  described  by  the  Court  illustrates  the
difficulty  of  reconciling  the  budget  annuality  principle
and  the  multiannual  planning  used  for  the  Structural
Funds. 
and
commitments  depend  on  implementation  on  the  ground

Furthermore,  Community 

payments 

and  the  absorption  of  Community  appropriations  by  the
Member  States,  all  of  which  are  difficult  to  forecast
accurately  within  the  time  limits  for  the  budgetary
procedures  of  the  Union.

2.4. The  Commission  has  proposed  for  the  forthcoming
programming  period  a  system  under  which  the  annual
commitments  in  respect  of  a  programme  would  be  made
automatically.

2.5.
Information on the implementation of operations is
included in the Member State declarations of expenditure
and  the  annual  progress  report  on  each  programme,  and
is  obtained  in  certain  cases  from  the  annual  closure  of
operations.  The  Commission  presents  this  information  in
its  annual  reports  on  Structural  Funds  implementation.
For  the  next  programming  period  the  Commission  has
proposed  a  greatly  simplified  indexation  system  and  is
developing  a  new  common  information  system.

The  information  presented  by  the  Commission  in  the
revenue  and  expenditure  account  and  in  the  financial
statement  as  ‘off-balance  sheet  obligations’  may  raise
marginal  questions  of 
further
comment,  please  see  point  4.2.

interpretation.  For 

2.6. Precise  budgetary  forecasting  is  hardly  possible,
given  the  multiannual  nature  of  the  operations  and  the
great  variety  of  situations  of  implementation  on  the
ground.  However,  the  Commission  and  the  Member
States  are  cooperating  in  the  context  of  the  SEM  2000
initiative  to  improve  forecasting  so  far  as  this  can
realistically  be  done.

2.8. The  Commission  wishes  to  underline  that  the
causes  of  delay  described  in  this  paragraph  emerge  from
an  analysis  of  the  programmes  which  were  progressing
particularly  slowly.  Such  problems  should  not  therefore
be assumed to be widespread. However, a number of the
problems  mentioned  should  be  solved  or  eased  by  recent
Commission  action  (e.g.  in  adopting  precise  eligibility
rules)  or  by  the  Commission’s  proposals  for  regulatory
change  for  the  next  programming  period.  Others  require
greater operational efficiency at various levels. Yet others
(for  example,  the  overlapping  of  programming  periods,
the  difference  between  Community  and  certain  national
procedures, variations in exchange rates) have to be lived
with  and  coped  with  by  the  officials  concerned.

2.9. The Commission will continue to seek to ensure, in
partnership  with  the  Member  States,  the  best  possible
management  of  Structural  Funds  programmes.

C  347/84

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Official  Journal  of  the  European  Communities

16.11.98

3.  FINANCIAL  PROGRAMMING  AND  BUDGETARY
STRUCTURAL
OF 

THE 

IMPLEMENTATION 
OPERATIONS

3.1. The  distribution  of  Structural  Fund  appropriations
among  Objectives,  Community  Initiatives  and  Member
States  was  a  major  technical  and  political  operation
which  the  Commission  considers  that  it  carried  out
efficiently,  in  conformity  with  the  regulations  and,  given
the  magnitude  of  the  task,  within  a  reasonable  time.

3.5.-3.7. The  Commission  agrees  that  progress  with  the
Community Initiative programmes has generally been too
slow, but it should be understood that these programmes
frequently  required  the  setting-up  of  new  management
structures,  for  example  a  new  type  of  local  partnership
for  the  URBAN  and  Interreg  II  programmes.  Delays  also
resulted from the large number of programmes proposed,
often  late,  by  the  Member  States  (for  certain  countries  a
separate  programme  for  each  project  and  for  each
region),  many  of  which  did  not  meet  the  minimum
quality standard required. Adoption of most of the CIs in
1995  and  1996 
implementation  of
commitment  appropriations  for  those  two  years.

to  better 

led 

The Commission has proposed for the next programming
period that there should only be three CIs, and will press
for  there  to  be  far  fewer  individual  programmes  than
now.

in 

to 

the 

respect 

shortfall 

commitment
With 
appropriations  in  1997,  the  volume  of  commitment
appropriations  which  the  budgetary  authority  finally
entered in the Community budget was smaller than what
the  Commission  proposed.  The  budgetary  authority  also
did  not  authorise  a  transfer  of  payment  appropriations
towards  the  end  of  1997.

3.8. The  amount  of  ECU  3 171  million  represents  only
about  2 %  of  the  total  budget  allocation  for  1994-1999.
The  ECU  1 405  million  for  payments  relates  to  the
overall  (theoretical)  financial  perspective,  and  does  not
correlate  directly  with  the  structural  operations  and  the
budget  of  1999.

3.12. The  rules  of  financial  management  are  based  on
the  principle  of  proportionality  between  expenditure
incurred on the ground in respect of an operation and the
volume  of  Community  commitments  and  payments  in
respect  of  the  operation  in  question.  It  is  clear,  however,
that  Commission  commitments  and  advance  payments
for the co-financing of operations at variable rates cannot
reflect  precisely  the  actual 
implementation  of  these
operations; they only give an indication of actual progress
on  the  ground.  The  Commission’s  regulatory  proposals
for  the  new  programming  period  include  the  concept
that,  after  an  initial  payment  on  account,  subsequent
Commission  payments  should  no  longer  be  advances  but
should  be  reimbursements  of  payments  actually  made  in
the  Member  States.  On  that  basis,  the  Commission
payments would reflect more directly real progress on the
ground.  The  Commission  has  also  proposed 
that
programmes  involving  a  Community  contribution  of
ECU 40 million or less should no longer be the subject of
a  single  commitment  but  should, 
larger
the 
programmes,  be  committed  in  annual  instalments.

like 

information  on  the 
their  progress  on 

The  annual  reports  enable  Member  States  to  send  the
implementation  of
Commission 
projects  and 
the  ground.  The
Commission,  in  order  to  do  its  job,  does  not  require
detailed  information  about  the  state  of  execution  of
individual projects.

4.  EXISTING  INFORMATION  ON  THE

IMPLEMENTATION  OF  STRUCTURAL  OPERATIONS

4.1. The  Commission  takes  the  view  that  although  the
various management information systems set up could be
improved,  they  provide  operators  with  the  information
they  need.  The  Commission  encourages  the  Member
States  to  improve  the  monitoring  systems  by  providing
technical assistance.

For  the  next  period,  the  Commission  proposes  that  the
Member States tighten their monitoring, information and
control  systems  in  return  for  the  decentralisation  of  the
management  of  projects.

3.11.
Implementation  of  Objective  2  took  place  in  two
phases  (1994-1996  and  1997-1999)  in  accordance  with
the  rules.  This  made  it  necessary  to  concentrate  funds
somewhat  artificially  into  the  last  tranche  of  the  first
period, whereas if the outlay had been programmed over
the  entire  1994-1999  period,  the  funds  would  not  have
had  to  be  concentrated  and  could  have  been  spread  over
the second part of the period. In addition, the transfer to
1997-1999  represents  no  more  than  12 %  of  the  total
Objective  2  allocation  for  1994-1996.

4.2. The  subject  of  ‘off-balance  sheet  obligations’  for
structural  actions  raises  questions  of  definition.  In  the
Commission’s view the basic obligations are derived from
the  Edinburgh  allocations,  the  Structural  Funds  and
Cohesion  Fund  regulations  and  the  Interinstitutional
Agreement. Accordingly, the off-balance sheet obligations
may be defined as the overall Structural Funds allocations
(including  full  indexation),  less  the  implementation.  This
amount  represents  the  ceiling  of  the  relevant  obligations,

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as  well  as  the  likely  outcome,  subject  to  any  future  (still
unknown)  decommitments.

The Court wants a distinction to be made regarding ‘legal
commitments’.  This  would  imply  a  reduction  of  the
above  amount  by  (i)  indexation  to  the  extent  that
Member  States  have  not  yet  formally  made  use  of  their
option  to  allocate  the  indexation  to  specific  programmes
and  (ii)  amounts  still  to  be  allocated  at  programme  level
(e.g.  reserves).  These  amounts  are  fairly  marginal  at  the
end  of  the  programming  period,  but  still  constitute  an
obligation  for  the  structural  actions.  In  addition,  there
are  continuous  reallocations  at  programme  level,  making
a  ‘bottom-up’  calculation  of  off-balance  obligations  at  a
given date impracticable.

commitment  of  successive  tranches.  The  rescheduling  of
the  financial  plans  for  programmes  is  designed  to  adapt
programming  of  operations  to  actual  implementation.
The  adaptation  of  financial  plans  makes  it  possible  to
the  Community
full  amount  of 
ensure 
contribution  is  committed.

that 

the 

for 

for  regulations 

the  next
The  new  proposals 
programming  period  represent  a  simplification  of  the
system since the commitments will be made automatically
each  year,  and  payments  will  be  based  solely  on  the
actual  expenditure  incurred.  The  system  of  automatic
the  phenomenon  of
commitment  should  eliminate 
rescheduling  at  the  end  of  a  period.

A  further  problem  in  calculating  and  verifying  the
off-balance  obligations  at  a  given  date  is  that  only
commitments  and  payments  are  registered  as  accounting
data; the programme allocations are not registered in the
same  way.  This  may  raise  questions  of  interpretation.

4.7. The Commission is trying to set up a more efficient
system to replace ARINCO. However, during the current
programming period, each lead department had access to
the  information  needed  to  monitor  the  Funds’  objectives
for  which  it  was  responsible.  The  overall  results  are
presented  in  the  annual  reports  of  the  Structural  Funds.

4.3. The  Commission  has  explained  and  justified  its
administrative and accounting practices in this area in its
replies  to  paragraph  21.4  of  the  Court’s  1996  Annual
Report  and  paragraphs  3.34-3.35  of  the  1995  DAS
report.  The 
‘standard  clauses’  explicitly  allow  two
possible  methods  of  closing  annual  instalments.  The
principle  of  annuality  of 
the  Community  budget
inevitably  introduces  an  element  of  ‘artificiality’  into  the
budgetary treatment of the Structural Funds’ multiannual
programmes.

4.4. The  Commission  is  preparing  a  proposal  for  a
major revision of the Financial Regulation. This will take
full  account  of  the  Court’s  Opinion  No  4/97.

the  specific 

4.5-4.6. The  allocation  of  clearly  defined  amounts  to
structural  operations  (Structural  Funds  and  the  Cohesion
Fund)  was  established 
framework
in 
regulations  of  the  instruments  concerned  and  in  the
Interinstitutional 
budgetary
procedures  ensure  that  the  amounts  in  question  are  in
fact  made  available.  Budgetary  management  in  terms  of
commitment  appropriations  makes  it  possible  to  ensure
that  the  provision  is  observed  and  to  check  it.

Agreement. 

Special 

The  allocation  is  made  when  the  decisions  awarding
Community  aid 
for  programmes  and  projects  are
adopted.  In  this  context,  the  commitments,  as  is  the  case
for  any  operation  financed  by  the  Community  budget,
constitute  an  upper  limit  for  authorised  payments  for  a
given  project.  The  innovation  in  the  specific  financial
rules  of  the  Structural  Funds  and  the  Cohesion  Fund  is
the
that 

limit  changes  over 

following 

time 

the 

5.  BUDGETARY 
OPERATIONS

PROCEDURES 

FOR 

STRUCTURAL

5.1.-5.2. The  use  of  budget  transfers  is  an  integral  and
normal  part  of  the  budgetary  management  of  the
Structural Funds. The Commission does not consider that
these  transfers  are  excessive  in  percentage  terms.  The
most  substantial  movements  were  submitted  to  the
budgetary  authority  for  approval  together  with  the
relevant  supporting  documents.  In  1994  and  1995  there
were  two  main  grounds  for  transfers:

1.  distribution  by  Fund  and  consequently  by  budget

chapter  was  not  known  beforehand;

2.  the  rate  of  adoption  of  the  operations  varied  from

one  objective  to  another.

When  the  preliminary  draft  budget  is  being  prepared,
account  has  to  be  taken  of  all  kinds  of  elements  which
are  often  hard  to  predict,  for  example  completion  of  the
adoption procedures in respect of operations or their rate
of  implementation.  The  example  cited  by  the  Court
concerning  the  CSF/SPD  of  Objective  2  precisely  reflects
the fact that under-utilisation in the case of these projects
in  1996  could  not  be  taken  into  account  in  the  1997
budget  estimates.

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In  the  case  of  commitment  appropriations  the  total
budget  is  predetermined.  In  its  forecasts  the  Commission
must  look  for  the  best  distribution  of  the  total  amount
between  the  budget  headings.

improve  budget 

Within  the  SEM  2000  framework,  the  Commission  has
established  a  Budgetary  Network  with  the  Ministries  of
Finance in the Member States, with one purpose which is
to 
the
complexity  and  flexibility  (in  the  form  of  options
available  to  Member  States)  of  the  present  delivery
system  imply  a  degree  of  uncertainty  in  budgetary
forecasting  that  has  to  be  dealt  with  by  transfers,  etc.

forecasting.  Nevertheless, 

5.3. Updated  financial  plans  are  used  to  prepare  the
preliminary draft budget for the Structural Funds. For the
1995  budget  (prepared  in  the  spring  of  1994),  account
was taken of changes already made and in some cases of
those  under  way.

5.4. The  Commission  bases  the  budget  forecasting  of
‘top-down’
payments  on  different 
methods,  which  are  not 
‘applying
percentages’:

‘bottom-up’  and 
confined 

to 

—  an  item-by-item  assessment  of  the  needs  for  payment
appropriations  for  settling  outstanding  commitments
(RAL)  and  new  commitments  of  the  current  year;

—  a  forecast  by  Member  States  within  the  Budgetary

Network  mentioned  at  points  5.1.  and  5.2;

—  an 

extrapolation  analysis  of 

the  growth  of

commitments  and  related  payments  over  time;

—  a lump sum adjustment for likely over-budgeting in a

bottom-up  approach;

—  a lump sum adjustment reflecting the need for overall

budgetary  rigour.

5.5. The Commission emphasises again the legitimacy of
the  transfer  mechanism  as  a  means  of  adjusting  budget
allocations  to  changing  requirements.

5.7. The  managers  of  the  programmes  are  aware  of  the
nature  of  the  financial  plans  and  consider  them  a  useful
and  necessary  planning  and  management  tool.

in  practice.  Nevertheless,  although 

The  Commission  considers  that  the  system  has  worked
adequately 
the
indexation  method  was  simplified 
the  period
1994-1999  compared  with  the  previous  period,  it  is  still
too  complex  in  its  application.  For  the  forthcoming
programming  period  the  Commission  has  therefore
proposed that the new CSFs, SPDs and CIs be adopted at
current  prices.

for 

6.  DELAYS  IN  THE  UTILISATION  OF  COMMUNITY
APPROPRIATIONS  AT  THE  LEVEL  OF  THE
INDIVIDUAL  FORMS  OF  INTERVENTION

General  observations

6.1. The  Commission  draws  special  attention  to  the
Court’s  observation  as  to  the  non-representativity  of  the
results of its questionnaire, sent as it was to the managers
of  the  31  slowest-moving  programmes  (some  3 %  of  all
programmes). This circumstance needs to be kept fully in
mind  in  reading  the  Court’s  report.

6.2.-6.5. The  considerable  volume  of  financial  resources
involved  and  the  large  number  of  draft  programming
documents  —  some,  in  the  Commission’s  view,  of
insufficient  quality  —  meant  that  extra  time  was  needed
to  meet  the  quality  criteria  set  out  in  the  regulations,
especially 
those  requiring  precise  quantification  of
objectives,  prior  appraisal  of  the  expected  environmental
the  principle  of
and 
impact 
additionality.

compliance  with 

6.6.-6.8.
It  is  clear  that  the  national  procedures  applied
for  the  implementation  of  Structural  Funds  operations
may  affect  the  rate  of  absorption  of  the  funds  available.
These  procedures  must  nevertheless  take  proper  account
of  Community  requirements.

6.9. The  regulations  set  the  initial  eligibility  limit  in
respect  of  expenditure  incurred  by  final  beneficiaries.
This  is  the  date  of  receipt  by  the  Commission  of  the
the
corresponding  application 
Member  State.  The 
commitment
appropriations  is  specified  in  the  Commission  decision
approving  the  form  of  intervention  and  refers  to  legal
and  financial  commitments.

for  assistance 

final  date 

from 

for 

5.8.-5.9. The Commission informs the Member States of
the  available  financial  resources  resulting  from  the
application  of  indexation.  The  Member  State  is  free  to
make  proposals for allocating  the additional resources to
ongoing  operations  or  to  new  operations.

The  concept  of  the  ‘validity  of  the  commitment  by  the
Member  States’  was  defined  in  an  eligibility  data-sheet
drawn  up  by  the  Commission  together  with  the  Member
States.  The  payments  system  for  the  new  programming
period  proposed  by  the  Commission  will  mean  that  the
final  date  for  national  commitments  will  no  longer  have
any  operational  consequences.

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6.10.
It  is  true  that  there  is  no  initial  final  date  for  the
commitment  of  expenditure.  The  Commission,  however,
has  specified  the  conditions  of  eligible  expenditure  in
respect  of  commitments  entered  into  before  the  date  of
the  beginning  of  the  operation  (namely  before  the
Commission  received  the  corresponding  application  for
assistance)  in  paragraph  1.4  of  data-sheet  2  on  eligible
expenditure.

6.11. The  Commission  cannot  confine  co-financing
under  the  Structural  Funds  either  to  operations  under
way  or  to  new  operations;  on  the  contrary  it  must
provide support both for on-going operations and for the
development  of  new  operations  corresponding 
to
Community  priorities.

6.12.  The  Commission  agrees  that  the  coordination
required 
is
difficult,  but  considers  that  it  has  improved.

in  the  case  of  multi-fund  programmes 

6.13. The monitoring committees, organised and chaired
by the Member States, are in reality too diverse to justify
broad generalisations about their effectiveness, which has,
in the Commission’s view, in many cases improved. They
play  an  essential  part  in  the  management  of  Structural
Fund  operations.

In  the  context  of  the  reform  of  the  Funds  for  the  next
proposes
programming 
decentralising decisions concerning the implementation of
operations.  This  should  help  to  simplify  procedures
within  Member  States.

the  Commission 

period, 

6.18. The Commission’s departments responsible for the
State  aid  sector  have  taken  a  number  of  steps  to  avoid
unnecessary delays in approval procedures. Moreover, the
recent  approval  of  Council  Regulation  (EC)  No  994/98
on  the  application  of  Articles  92  and  93  of  the  Treaty
creates  the  possibility  for  the  Commission  to  exempt
certain  important  categories  of  aid  from  the  notification
requirements  of  Article  93(3).  This  should  further
simplify and facilitate the implementation of business aid
measures  under  the  next  generation  of  Structural  Fund
programmes.

in  the
6.19. The  annual  distribution  provided  for 
financial plans can only provide a guide for the remaining
years. This is a consequence of the multiannual nature of
programming  and  the  current  financial  management
system. In addition, the financial perspective is drawn up
by  the  budgetary  authority  for  use  when  annual  budgets
are  being  established;  they  must  therefore  somehow  be
reflected  in  the  programming  of  the  Structural  Funds.

6.21.
It  appears  rational,  where  expenditure  could  be
attributed  to  either  of  two  successive  programming
periods,  to  attribute  it  to  the  former  period  if  the
appropriations are available.

6.22. The  decentralisation  of  decisions  concerning  the
implementation  of  operations,  as  proposed  by  the
Commission  for  the  next  programming  period  on  the
basis  of  experience,  should  certainly  have  the  effect  of
simplifying  the  procedures  for  changing  programmes.

Programming

Financial channels

6.14.-6.16. The  Italian  authorities  had  considerable
difficulty  in  adapting  to  the  programme  approach  of  the
Structural  Funds  and  considerable  delays  affected
implementation  of
programme  approvals  and 
the
this  reason 
programmes  on 
Commission  and 
Italian  central  and  regional
authorities  concluded  an  agreement  in  July  1995  to
improve  the  management  of  the  Structural  Funds  in
Italy.

the  ground.  For 

the 

the 

6.23. The  Commission  endeavours  to  make  its  own
payments  as  quickly  as  possible.  The  regulations  provide
for  a  system  of  advances  in  order  to  prefinance  the
payments  the  Member  States  must  make  under  the
Structural  Funds.  The  complexity  of  financial  channels
referred to by the Court is unavoidable given that several
national,  regional  and  local  authorities  have  to  act  in
turn.

The  negotiations  on  some  programmes  were  protracted.
This  was  due  primarily  to  weaknesses  in  the  proposals.
Two  DG  XVI-led  programmes  presented  in  1994  were
indeed  only  adopted  in  1997  —  Interreg  II  Italy-Austria
and  Italy-Slovenia.  Negotiations  on  these  programmes
were difficult but the Commission agrees that they should
have  been  concluded  more  rapidly.

6.17. Member State proposals for co-financing of global
grants  frequently  raise  difficult  issues  which  inevitably
take  time  to  settle.

6.24.-6.26. Structural  Funds  co-financing  is  based  on
advances  to  the  Member  States  aiming  at  facilitating  the
smooth  implementation  of  the  operations.  It  is  clear,
however,  that  the  national  administrative  arrangements
for  implementation  have  an  important  impact  on  the
progress  of  the  programmes  and  the  absorption  of  the
available  funds.  The  Commission  cannot  replace  the
Member States in this respect. However, Regulation (EC)
includes  specific  provisions  which  are
No  2064/97 
expected 
the  situation:  Article  2(2)(b)
improve 
to 
provides  for  verification  by  the  Member  State  of  the

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allocation  and  the  transfers  of  the  available  Community
and  national  funds;  Article  4(f)  provides  for  verification
that  the  payment  of  the  Community  contributions  to
final  beneficiaries  is  made  without  any  reductions  or
unjustified  delays.

Commission  considerably  affect  the  rate  of  Community
payments. These payments can only give an indication of
real  progress  on  the  ground;  they  cannot  reflect  it
precisely.

6.27. The  low  level  of  public  expenditure  in  1994
reflects  the  late  adoption  of  this  programme.  The  annual
distribution  of  expenditure  was  guided  more  by  the
financial  perspective  than  by  realistic  expectations  of
implementation.  In  addition  the  annual  tranches  are
established  at  programme  level  and  are  not  necessarily
geared  to  each  of  the  1 256  projects  co-financed  in
Saxe-Anhalt  during  the  period  1994-96.

In  1997  only  20 %  of  payments  were  made  in
6.28.
in  1994.  The
December,  as  compared  with  48 % 
corresponding  figures  for  commitments  were  32 %  and
60 %.  The  Commission’s  proposals 
the  next
programming  period  would  eliminate  the  concentration
of  Commission  commitments  and  payments  towards  the
year-end.

for 

6.29. The  procedures  referred  to  by  the  Court  would
need  to  be  set  up  within  the  Member  States.  The
Commission  agrees  that  Member  State  expenditure
declarations  are  not  always  reliable.  The  proper
application  of  Regulation  (EC)  No  2064/97  is  expected
to  improve  the  situation.

6.30.-6.32. The  Commission  is  aware  that  delays  in
financial  procedures  may  be  caused  by  problems  with
information  flows  in  the  Member  States.  It  recalls,
however,  that  its  own  payments  generally  take  the  form
of  advances  to  cover  Member  State  expenditure  which
has  not  yet  been  declared.  It  is  expected  that  the
provisions  of  Article  2(2)(a)  of  Regulation  (EC)  No
2064/97  about  the  audit  trail  will  improve  the  quality
and  the  speed  of  these  information  flows.  The  trigger
points  are  calculated  on  the  basis  of  the  expenditure
amounts 
in  the  financial  plans  and  the
percentages  provided  for  by  Article  21  of  Regulation
(EEC) No 4253/88; on this basis, ignorance about trigger
points  at  Member  State  level  does  not  appear  justified.
The  Commission’s  proposals  for  the  new  programming
period provide for the Commission to make payments on
the basis of Member State expenditure declarations which
will  no  longer  have  to  reach  a  specific  minimum  level  in
order  to  trigger  the  payment.

indicated 

Delays  in  payment  by  the  Commission  generally  affect
only  the  final  instalment  on  a  programme;  they  are
usually  due  to  lack  of  sufficient  information  from  the
Member  State.  The  Commission  cannot  close  a
programme  if  it  is  not  put  in  a  position  to  do  so.

6.33.
It  is  evident  that  the  implementation  rate  of  the
programmes and the speed of the information flows from
final  beneficiaries  through  various  intermediaries  to  the

Mobilisation  of  resources

6.35. The  Court’s  comment  is  based  on  the  situation  in
Italy in 1994 and 1995. It is true that in the three Italian
regions  checked  by 
in  1996,  central
government co-financing reached the region very late. But
in two of the three regions the regional authorities opted
to prefinance the amount payable by central government.
Since  then  the  problem  has  been  solved  (see  reply  to
paragraph  7.57  of  the  annual  report  for  1996).

the  Court 

separate 

from  negotiations  with 
to  have 

the
6.37. Quite 
Commission,  Corsica  dropped  plans 
the
incinerators  at  Bastia  and  Ajaccio  financed  under  SPD
1994-99.  For  technical  reasons  the  second  project  was
not yet ready to be launched and the regional authorities
preferred  to  carry  out  both  projects  at  the  same  time.

for 

6.38.-6.39.  Applications 
co-financing  private
investments  are  checked  to  ensure  that  they  are  in
conformity  with  the  current  aid  scheme  (for  Germany,
the  ‘Gemeinschaftsaufgabe’)  and  not  to  measure  their
possible  impact  on  the  economy  or  other  external
factors.

6.42.
It  is  recognised  that  the  Italian  administrative
procedures are too long and complex. It is therefore more
appropriate,  as  stipulated  in  the  ‘Intesa’  (agreement
between  the  Italian  government  and  the  Commission  of
26.  July  1995  aiming  at  improvements  in  the  use  of  the
Structural  Funds  in  Italy),  to  streamline  these  procedures
than  to  adjust  Structural  Funds  programmes  (including
financial plans) to take account of the delays the existing
procedures  cause.

6.43-6.44. The  Commission  has  long  been  aware  of  the
effect of national currency/ecu exchange rate fluctuations.
It  does  all  in  its  power  to  attenuate  these  effects  when
they  are  negative.  The  legislation  requires  financial  plans
and  accounts  of  operations  to  be  drawn  up  in  ecus,
which  eliminate  the  exchange  risks  for  the  Community
budget  and  in  a  way  promotes  the  Community  currency.
The  effects  referred  to  will  disappear  for  Member  States
in  the  euro  zone.  As  regards  Italy,  the  fluctuation  of  the
lira  against  the  ecu  had  a  detrimental  effect  on  the
closure  of  the  1989-93  programmes.  However,  it  is  not
clear  if  an  ‘effective  reaction’,  which  would  imply  an
increase  in  national  spending  to  draw  down  all  the

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available  Community  aid,  would  have  been  an  available
option  in  many  cases.  For  example,  due  to  the  fact  that
they  worked  in  the  national  currency  and  made  their
declarations  on  the  basis  of  the  amounts  they  received
from  the  national  Treasury  in  lire,  many  intermediary
organisations  managing  global  grants  had  no  practical
way  of  increasing  their  existing  budgets.

report  of  the  previous  year  containing  the  data  specified
in  Article  36  has  been  sent  to  the  Commission  (Article
31.3).  In  addition,  the  Commission  will  be  required  to
notify  the  Member  State  and  the  designated  authority  if
intermediate
the  conditions 
any  of 
payments  is  not  fulfilled.

for  disbursing 

Implementation

6.45. The  definitions  of  commitment,  final  beneficiary
and  eligible  expenditure  were  clarified  with  the  adoption
of  the  eligibility  datasheets  by  the  Commission 
in
consultation with the Member States. More generally, the
Commission  makes  a  continuous  effort  to  provide
information;  the  Member  States  must  also  participate  in
this  work  as  required  by  the  regulations.

6.46. The application of the Structural Funds in the new
Member  States  inevitably  required  the  setting  up  of  new
administrative  systems  and  the  adaptation  of  national
systems  to  disburse  and  account  for  the  expenditure  of
EU  monies.  Certain  start-up  problems  arose  but  these
have  now  largely  been  resolved.

6.47. The  offsetting  of  recoveries  against  payments  at
the  level  of  the  same  national  implementing  authority  is
an  accounting  practice  aiming  at  the  simplification  of
procedures;  it  cannot  be  considered  a  valid  reason  for
delays 
subsequent
in 
programme.

implementation  of  a 

the 

The  Commission,  rightly,  does  not  make  payments  until
the  Member  State  has  presented 
the  necessary
information.

6.48. The  ERDF  and  the  ESF  are  not  administered  in
the same way, but the regional managers of the Fund are
familiar  with  and  can  handle  these  differences.  In  the
Commission, 
lead  DG  acts  as  coordinator;
coordination  is  achieved  by  interdepartmental  meetings
where  operational  and  financial  questions  are  raised  and
solved.

the 

For  the  charging  of  Hainaut  SPD  projects  between  the
ERDF and the Social Fund, the manager had access to all
the  necessary  information  concerning  eligibility  for  the
Structural Funds, since the separation between Funds was
made  clear  both  in  the  SPD  and  at  partnership  meetings
with  the  region  of  Wallonia.

6.49. The  new  general  regulation  proposed  by  the
Commission  details  the  contents  of  the  annual  report
(Article  36)  and  provides  that  intermediate  payments  of
funds  will  not  be  made  unless  the  annual  implementing

reprogramming  adopted 

6.50. The  financial  profiles  of  all  measures  in  the
Sardinia  regional  programme  have  now  been  adjusted  in
the 
in  December  1997.
Furthermore,  measures  have  been  modified  to  improve
flexibility  and  to  eliminate  projects  which  cannot  be
implemented  in  the  required  time  scale.  This  process  will
continue 
committees,
depending  on  the  progress  made  in  implementing  the
revised programme.

forthcoming  monitoring 

in 

6.51.
It  is  important  to  minimise  delays  relating  to  the
need  to  ensure  that  all  the  projects  comply  with  the
relevant  Community  regulations.

6.52. Sardinia:  please  see  comments  on  paragraph  6.50.
Corsica:  following  delays,  a  reprogramming  of  the  SPD
was  decided  by  the  Commission  on  30  July  1996.  New
procedures  were  introduced  by  the  competent  Member
State  authorities  in  November  1996  and  January  1997
with a view to improving monitoring and implementation
of  the  SPD.

inevitable  given  that 
is
6.53. Some  delays  are 
implementation  of  projects
impossible  to  plan  the 
should  be
precisely.  The  amendment  procedures 
simplified by the Commission proposal to decentralise the
implementation  of  operations.  Irregularities  must  clearly
be  corrected  even  if  this  means  a  delay.

it 

7.  CONCLUSION

7.1. The  annual  commitment  appropriations  entered  in
the  budget  for  structural  actions  correspond  to  the
financial  perspective.  It  is  difficult  to  make  accurate
forecasts  of  requirements  for  payment  appropriations,
since they are related to the variable progress of hundreds
of  programmes  and  hundreds  of  thousands  of  individual
projects.  The  Commission  and  the  Member  States  are
together  seeking  to  improve  these  forecasts.

In 

its  current  major  review  of  the  Financial
7.2.
Regulation 
the
relationship  between  the  horizontal  and  the  sectoral
financial rules.

the  Commission 

to  clarify 

intends 

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7.4. The  Commission  does  not  consider 
its
approach to budgetary commitments for Structural Funds
programmes gives a confused image; it is clear that there
is  no  precise  relationship,  during  the  currency  of  a
programme,  between  commitments  from  the  Community
budget  on  the  one  hand  and  the  real  progress  of  a
programme  on  the  ground  on  the  other  hand.

that 

financial  plans  are  considered  useful  by 

The 
programme managers.

the

The  Commission’s  proposals  for  the  period  2000-2006
are  designed  to  clarify  responsibilities  in  the  area  of
programming  and  increase  the  degree  of  decentralisation
to  the  Member  States.

7.5. Those  concerned  with  the  policy  management
and/or  the  financial  management  of  a  programme  at  any
given  level  need  to  be  in  possession  of  the  information
which  they  require  in  order  to  do  their  own  job
properly.

The  Commission’s  recent  Regulation  (EC)  No  2064/97
on  financial  control  includes  requirements,  for  example
on  the  audit  trail,  which  should  improve  the  quality  of
financial information.

The  Commission  hopes  to  establish  for  the  next
programming period an improved horizontal information
system to replace ARINCO. However, it is not necessary
for everyone concerned with the Structural Funds to have

access  to  the  same  global  stock  of  information.  In
particular,  the  Commission  does  not  consider  that  it
requires  access  to  detailed  information  at  project  level.

to  which 

receive  without  unjustified  delay 
they  are  entitled.  Once 

is  to  ensure  that  the
7.6. The  main  requirement 
the
beneficiaries 
payments 
the
Commission  has  paid  the  advance,  this  must  depend
essentially  on  the  efficiency  of  Member  State  financial
circuits  and  procedures.  The  Commission  was  obliged  to
make  payments  through  commercial  banks  in  most
Member  States,  since  payments  are  made  in  ecus  and
only  two  Member  States  have  authorised  the  national
treasury  to  keep  accounts  in  ecus.

As  of  1999,  this  complication  will  disappear  in  the
Member  States  members  of  the  euro  zone.

7.7. The  Commission  would  point  out  that  the  Court’s
chapter 6 concerning delays mainly reflects the experience
of managers of programmes with the greatest delays (3 %
of  the  total).  Most  of  the  programmes  proceed  normally
with  no  great  delays.  The  Commission,  however,  accepts
that  several  aspects  of  programme  management  could  be
improved and speeded up. Its proposals for the reform of
the  new  programming  period  should  make  a  major
contribution  to  this  improvement.

7.8. The  Commission  intends  to  play  its  part  to  the  full
in  this  effort  in  favour  of  improvement.