Report from the Commission - The Phare programme annual Report 2001 {SEC(2003) 228}
Date: 2003-03-03
Institutions: European Commission
Subjects: EU programme, accession to the European Union, activity report, enlargement of the Union, pre-accession aid

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 03.03.2003
COM(2003) 97 final

REPORT FROM THE COMMISSION

THE PHARE PROGRAMME ANNUAL REPORT 2001

{SEC(2003) 228}

TABLE OF CONTENTS

1.

1.1.

1.2.

1.3.

2.

2.1.

2.2.

2.3.

2.4.

2.5.

2.6.

2.7.

2.8.

3.

3.1.

3.2.

4.

The year in review........................................................................................................ 4

Main evolutions of the Enlargement Process in 2001.................................................. 4

The Conclusions of the Göteborg and Laeken European Councils ............................. 5

ISPA and SAPARD and the Co-ordination of the Community Pre-accession
assistance...................................................................................................................... 6

Implementation of the Phare programme..................................................................... 6

General overview: implementing the Phare guidelines ............................................... 6

General overview: Financial and technical assistance ................................................. 6

The Phare 2000 review................................................................................................. 8

Phare National Programmes......................................................................................... 9

Phare Cross-border co-operation ............................................................................... 11

Multi-beneficiary programmes................................................................................... 12

Participation in Community programmes and Agencies ........................................... 18

Co-operation with the EIB and international financial institutions ........................... 19

Programme management............................................................................................ 20

Moving towards extended decentralisation (EDIS) ................................................... 20

Monitoring, Assessment and Ex-post Evaluation ...................................................... 20

Financial overview and performance ......................................................................... 24

2

SUMMARY

This  is  the  yearly  report  by  the  European  Commission  to  the  European  Parliament,  the
Council of the European Union and the European Economic and Social Committee, assessing
the progress of the Phare pre-accession instrument.

The  Phare  programme  is  one  of  the  three  pre-accession  instruments  financed  by  the
European Communities to assist the applicant countries of central Europe in their preparations
for  joining  the  European  Union.  Originally  created  to  assist  Poland  and  Hungary  in  1989,
today  the  Phare  programme  encompasses  the  10  candidate  countries  of  central  and  eastern
Europe,  i.e.  Bulgaria,  the  Czech  Republic,  Estonia,  Hungary,  Latvia,  Lithuania,  Poland,
Slovakia, Slovenia and Romania.

Phare’s total "pre-accession" focus was put in place in 1997 in response to the Luxembourg
European  Council’s  launching  of  the  present  enlargement  process.  Phare  funds  now  focus
entirely on the pre-accession priorities highlighted in each country’s Accession Parnership.

In  2000-2006,  Phare  is  providing  some  €11  billion   of  cofinancing  for  institution  building
support through "twinning" and technical assistance and for investment support. The objective
is  to  assist  the  candidate  countries  in  their  efforts  to  strengthen  their  public  administrations
and  institutions  to  function  effectively  inside  the  Union,  to  promote  convergence  with  the
European Community’s extensive legislation and reduce the need for transition periods and to
promote economic and social cohesion.

In 2001, total Phare commitments amounted to € 1641 million . Programming was based,
as  in  2000,  on  the  revised  guidelines  for  Phare  that  take  account  of  the  new  ISPA  and
SAPARD regulations that took effect from 2000. The new guidelines also emphasise the need
to use the Phare programme to ensure a smooth and effective transition towards Structural
Funds, through investments in economic and social cohesion. During 2001 steps were taken
in order to reinforce the programming approach used under the Structural  Funds to help the
candidate countries prepare to benefit from these funds after accession.

The European Commission has increasingly transferred responsibility for the management
and implementation of Phare programmes to the authorities in the candidate  countries. As a
result,  several  activities  previously  included  in  multi-country  programmes  have  been
integrated into national programmes.

A  technical  document,  which  is  presented  as  an  annex  to  this  report,  contains  sections  on
programming  and  implementation  of  the  Phare  Programme  in  each  of  the  beneficiary
countries (SEC(2003) 228).

3

1.

THE YEAR IN REVIEW

1.1.

Main evolutions of the Enlargement Process in 2001

On  13  November,  the  Commission  adopted  its  2001  Enlargement  package,  consisting  of  a
Strategy Paper, the 2001 Regular Reports assessing progress made by each of the  candidate
countries  towards  meeting  the  accession  criteria,  and  proposals  for  revised  Accession
Partnerships with each of the negotiating countries.

The findings of the 2001 Regular Reports were encouraging. All candidate countries, except
Turkey,  continued  to  meet  the  political  criteria,  and  have  made  further  progress  in  this
respect.  Further  progress  has  been  registered  also  in  terms  of  the  economic  criteria  and  as
regards the ability to take on the obligations of membership.

On  the  basis  of  progress  made  to  date,  the  Commission  put  forward  a  strategic  approach
aimed  at  making  a  success  of  enlargement,  and  meeting  the  objectives  set  by  the  Göteborg
European Council, i.e. that candidate countries that are ready should participate as Members
in the European Parliament elections of 2004,  and should be able to  conclude  the  accession
negotiations by the end of 2002 .

The strategic approach proposed by the Commission consisted of two key elements:

– 

– 

indications  on  how  to  deal  with  the  remaining  negotiating  chapters  under  the
roadmap  for  the  negotiations  (agriculture,  regional  policy,  financial  and  budgetary
provisions, institutions and other) on the basis of the existing acquis, and within the
financial framework set by the 1999 Berlin European Council;

an  action  plan  to  strengthen  and  monitor  candidate  countries'  administrative  and
judicial capacity, in which the Commission takes the lead, and has as its partners the
candidate countries and the Member States.

In addition, the strategy paper provided indications for the next steps with those negotiating
countries that will not meet the Göteborg objectives and for launching a new phase in the pre-
accession  strategy  for  Turkey.  Given  that  Turkey  did  not  meet  the  Copenhagen  political
criteria, negotiations could not be opened with this country.

State of play in the negotiations

In  accordance  with  the  roadmap,  during  the  Swedish  presidency  the  Union  has  defined
Common  positions  on  the  core  internal  market  chapters,  as  well  as  on  environment,  social
affairs, external relations, culture and audio-visual policy. In a considerable number of cases,
this has led to provisional closure. In addition, in line with the commitment taken at the Feira
European  Council  and  confirmed  at  Nice,  all  remaining  chapters  were  opened  with  several
countries negotiating since 2000.

For  the  period  of  the  Belgian  presidency,  the  roadmap  earmarked  9  chapters  as  priority
chapters, i.e. competition, transport, energy, taxation, customs union, justice and home affairs,
agriculture  (veterinary  and  phyto-sanitary 
financial  control.
Considerable  work  was  achieved  under  the  Belgian  presidency  (progress  report  on
competition, information note on transport, information note on veterinary and phyto-sanitary

issues),  fisheries,  and 

4

issues).  Furthermore,  a  number  of  chapters  were  closed  with  almost  all  countries  (fisheries
and financial control).

The  Swedish  Presidency  organised  three  Deputies  Accession  Conferences  on  29  and  30
March,  17  May  and  1  June,  and  a  Ministerial  Conference  on  11  and  12  June.  The  Belgian
Presidency organised a first Deputies Conference on 27 July, a second on 26  October and a
third on 28 November. An Accession Conference at Ministerial level took place on 11 an 12
December.

Screening/monitoring

In  line  with  the  Helsinki  and  Feira  conclusions  on  the  link  between  progress  in  the
negotiations  and  on  the  ground,  in  mid  2000  the  Commission  has  launched  a  process  of
monitoring of the negotiations. Its purpose is to assess the implementation of commitments
candidates have taken in the negotiations, and in general to identify any delays that may have
occurred  in  the  adoption  and  implementation  of  the  acquis  by  each  candidate,  highlighting
problems that exist or may be expected. For any new acquis adopted and published during a
given  calendar  year,  the  Commission  transmits  at  the  beginning  of  the  following  year  the
relevant  legal  texts  to  the  candidate  countries.  Analytical  examination  of  the  acquis  or
screening  takes  place  in  the  context  of  the  Association  Committees  and  Sub-committees
under the Association Agreements.

The Commission will  undertake  an  enhanced  monitoring  of  the  negotiations  with  a  view  to
the Seville European Council in June 2002.

Enlargement communication strategy

In order to accompany the enlargement process, both at home and in the candidate countries,
the Commission has adopted an Enlargement Communication Strategy, which  addresses the
EU  citizens  as  well  as  the  population  of  the  candidate  countries,  informing  them  about  the
costs  and  benefits  at  stake.  This  strategy  is  being  implemented  in  a  de-centralised  way,
through  the  Commission's  Delegations  in  the  respective  candidate  countries  and  its
Representations in the Member States.

1.2.

The Conclusions of the Göteborg and Laeken European Councils

After  the  breakthrough  in  the  enlargement  process  that  was  achieved  at  Nice,  with  the
conclusion  of  the  IGC  on  internal  reform  and  the  endorsement  of  the  enlargement  strategy
proposed by the Commission, the Göteborg European Council on 15 and 16 June brought a
further  step  forward.  In  particular,  the  European  Council  confirmed  that  the  enlargement
process is irreversible and formulated the objective, for the first time, that candidates which
are ready should participate as Members in the European Parliament elections of June 2004,
and should be able to conclude negotiations by the end of 2002.

The Göteborg European Council also urged candidate countries to devote particular attention
to  strengthening  their  administrative  structures  and  to  reforming  their  judicial  systems  and
civil service.

The Laeken European Council on 14 and 15 December welcomed the Commission strategy
paper and regular reports , confirmed the road map established by the Nice European Council
and reiterated that the objective is to complete the accession negotiations with those countries
that  are  ready  by  the  end  of  2002,  with  a  view  to  their  participation  in  the  2004  European
Parliament elections. For Bulgaria and Romania, the objective is to open negotiations on all

5

Chapters by the end of 2002. The Council also asked the Commission to present a report to
the  Seville  European  Council  in  June  2002  on  the  implementation  of  an  action  plan  for
administrative and judicial reform in the candidate countries. The Council acknowledged that
Turkey  had  made  progress  towards  complying  with  the  political  criteria  for  accession  and
encouraged Turkey to continue its reforms, notably with regard to human rights.

1.3.

ISPA  and  SAPARD  and  the  Co-ordination  of  the  Community  Pre-accession
assistance

ISPA  continued  its  operations  in  all  candidate  countries.  SAPARD  started  its  operations  in
five candidate countries following the “Commission decisions on conferral of management of
aid on implementing agencies” in 2001.

The Co-ordination Committee of the Commission at Directors level convened three times in
2001.

A General Assistance Document was presented at the Phare Management Committee on 26
April  2001.  The  Document  gives  an  overview  of  the  three  pre-accession  instruments,  their
priorities and implementation in 2001.

A  separate  annual  report  on  co-ordination  of  pre-accession  assistance  will  provide  more
detailed information on co-ordination between Phare, ISPA and SAPARD.

2.

IMPLEMENTATION OF THE PHARE PROGRAMME

2.1.

General overview: implementing the Phare guidelines

The European Commission has increasingly transferred responsibility for the management
and implementation of Phare programmes to the authorities in the candidate  countries. As a
result,  there  has  been  increasing  emphasis  on  national  programmes  designed  to  address
specific weaknesses identified in the annual Regular Reports prepared by the Commission on
each  candidate  country.  Several  activities  previously  included  in  multi-country  programmes
have been integrated into national programmes and this process continued in 2001, with the
integration of Phare support for participation in Community Programmes.

Moreover, in December 2001, the Commission prepared and circulated to candidate countries
a Checklist of actions necessary to implement a fully decentralised implementation system –
known as Extended Decentralisation Implementation System or EDIS.

Programming in 2001 was based, as in 2000, on the revised guidelines for Phare approved
by the Commission (SEC (1999) 1596 of 13 October). These guidelines build on the changes
decided in 1998 and take account of the new ISPA and SAPARD regulations that took effect
from 2000. The new guidelines also emphasise the need to use the Phare programme to help
the candidate countries prepare to benefit from Structural Funds after accession through
investments in economic and social cohesion.

2.2.

General overview: Financial and technical assistance

Under  the  revised  guidelines  (SEC  (1999)  1596),  approximately  30  per  cent  of  Phare
resources were earmarked for institution building, the main instrument of which is twinning
or twinning light (secondment of experts from Member States to the candidate countries to
help develop the capacity to implement specific aspects of the acquis). The other 70 per cent

6

was earmarked for investments designed to improve the regulatory framework to implement
the acquis and to promote economic and social cohesion. In fact, in 2001, institution building
accounted  for  37  per  cent  of  commitments  within  the  national  programmes  and  institution
building and associated investment combined accounted for 64 per cent. Thus, investment to
support economic and social cohesion accounted for 36 per cent of the national programmes.

In 2001, total Phare commitments amounted to € 1641 million, comprising:-

(cid:1)  national programmes: € 1091 million, of which:

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Bulgaria:

€ 83 million

Czech Rep.:

€ 65 million

Estonia:

€ 26 million

Hungary:

€ 90 million

Latvia :

€ 31 million

Lithuania:

€ 46 million

Poland :

€ 411 million

Romania:

€ 274 million

Slovakia:

€ 44 million

Slovenia:

€ 21 million

(cid:1)  cross-border co-operation: € 163 million

(cid:1)  regional and horizontal programmes: € 219 million

(cid:1)  nuclear safety: € 168 million

7

Support  in  favour  of  children  as  an  illustration  of  the  intervention  of  Phare  in  the
candidate countries

In most of the candidate countries of Central and Eastern Europe Phare supports projects in
favour  of  children.  The  total  for  projects  implemented  in  2001  amounts  to  about  €  55.5
million, financed through the National Programmes as well as under several multi-beneficiary
programmes  such  as  the  Access  Programme  and  the  Small  Projects  Programme.  Moreover,
new projects for the total amount € 24 million were launched in2001.

Main areas of intervention of the projects addressing the situation of children in the candidate
countries regard the reform of child care services, support for socially disadvantaged children,
such  as  street  children,  disabled,  abused  and  neglected  children  and  education,  from
kindergartens  to secondary  education. A major focus  is  the  access  to  education  for  children
from marginalised groups of society, particularly the Roma minority.

In Romania, for example, a € 25 million Ph are 1999 Programme on Child Protection supports
the reform of child protection. Main components of this programme are

(cid:1)  A grant scheme “Children First” aiming at closure of large old-style residential institutions,
under which 110 local child protection projects are implemented by the local Departments
for  Child  Protection  (day  care  centres,  family  type  homes,  foster  care,  re-integration
projects, mother and child centres).

(cid:1)  A national public awareness  campaign aimed  at  preventing  abandonment of children and
their  re-integration  into  (natural,  foster  or  national  adoptive)  families  and  informing  the
larger public of existing alternatives to institutionalisation of children.

(cid:1)  A Twinning project using EU member states’ expertise to facilitate co-operation between
the Ministry of Labour and Social Protection services with Child Protection Departments
(at  central  and  local  level)  in  order  to  ensure  that  Romania’s  overall  social  protection
policies  are  effective  in  providing  support  to  families  with  children,  and  preventing
abandonment and institutionalisation of children.

2.3.

The Phare 2000 review

Following a review of the Phare programme, in October 2000 was adopted a Communication
from  the  Commissioner  responsible  for  Enlargement  "Strengthening  Preparation  for
Membership" (C(2000)3103/2 of 27 October). The Phare 2000 Review concluded that Phare's
current orientations continue to address the main needs of the candidate countries and should
be  maintained.  However  the  review  identified  two  additional  challenges  for  Phare  in  the
2000-2006 period: (i) fully realising the 1997 reform of the Phare programme and (ii) moving
to Structural Funds.

In  the  course  of  2001  the  principal  developments  presented  in  the  Phare  2000  Review
Communication to tackle those two additional challenges have been put steadily on track.

The 1997 reform of Phare moved the programme to an accession-driven basis. In 2001 Phare
provided  increased  support  to  build  and  strengthen  the  institutions  that  candidate  countries
need  to  implement  the  acquis  upon  accession.  Such  assistance  was  channelled  through
support  to  institution  building,  the  main  instrument  of  which  is  twinning  or  twinning  light,
and through support to investments in the regulatory structures to implement the acquis. Steps
were  taken  to  further  decentralise  Phare  implementation  responsibility  to  the  candidate

8

countries  (Extended  Decentralised  Implementation  System)  aiming  at  waiving  the  ex-ante
approval of the projects by the Commission.

A  smooth  and  effective  transition  towards  Structural  Funds  requires  strengthening
candidate countries' programming and administrative capacity. During 2001 steps were taken
in order to reinforce the programming approach used under Structural Funds. To this aim, the
candidate countries were requested to submit a revised version of their (preliminary) National
Development  Plan.  The  NDPs  map  out  the  candidate  countries'  strategy,  priorities  and
measures  for  promoting  economic  and  social  cohesion  (ESC)  in  their  territories.  Thus  the
NDPs constitute the key steering documents for programming Phare ESC investments. While
having this pre-accession role, at the same time NDPs represent the forerunner of the future
Development  Plans/Draft  Single  Programming  Documents  required  by  the  Structural  Funds
Regulation.  The  use  of  "grant  schemes"  (i.e.  measures  as  defined  in  Article  9(j)  of  the
Structural Funds Regulation) become widely used as a mean to support ESC investments in
one of the areas of human resource development, productive sector investments and business
related infrastructure. This allows for a more decentralised implementation of Phare projects,
which  are  similar  in  size  and  nature  as  for  Structural  Funds  operations,  provided  candidate
countries are capable of running "schemes" instead of stand alone projects.

As concerns candidate countries' administrative capacity, in 2001 Phare intensified its support
to the candidate countries' structures deemed to manage the Structural Funds upon accession.
This was done mainly through Institution Building instruments, like twinning. Moreover, with
the support of TAIEX, starting in 2001 the Commission organised seminars on Structural
Funds and Accession in all candidate countries with the exception of Bulgaria and Romania,
to explain how Community Assistance is managed in the EU Member States and to present
Commission's view on what needs to be done by future Member States to prepare for
implementing Structural Funds from Accession up to 2006.

2.4.

Phare National Programmes

(cid:1)  Support to Institution building

– 

Twinning

Twinning was launched in May 1998 as the principal instrument for  Institution Building. It
aims  to  help  the  candidate  countries  in  their  development  of  modern  and  efficient
administrations,  with  the  structures,  human  resources  and  management  skills  needed  to
implement the acquis communautaire to the same standards as Member States.

Twinning's  targeted  pre-accession  assistance  is  based  on  the  long-term  secondment  of  civil
servants and accompanying short-term expert missions and training.

A total of 503 twinning projects have already been funded by the Community between 1998
and  2001.  Between  1998  and  2000,  373  of  these  projects  were  primarily  targeted  towards
agriculture,  environment,  public  finance,  justice  and  home  affairs  and  preparation  for  the
management  of  Structural  Funds.  These  represented  the  principal  priority  sectors  that  were
identified  in  the  Accession  Partnerships.  Since  2000,  other  important  sectors  of  the  acquis
have  also  been  addressed  through  twinning  for  example,  social  policy,  fight  against  drugs,
transport and telecommunications regulation.

Twinning  therefore  now  covers  all  sectors  pursuant  to  the  acquis.  Thanks  to  the  strong
support and response  from  EU  Member  States,  103  twinning  partnerships,  funded  by  Phare

9

1998 and involving all candidate countries and almost all Member States, have already been
concluded.  Under  Phare  1999  a  further  123  projects  are  being  implemented  and  the
programming  exercise  for  Phare  2000  included  a  further  146  twinning  projects.  The  2001
programming  exercise  encompasses  130  twinning  projects  across  all  Phare  beneficiary
countries, as well as Cyprus and Malta.

It  is  estimated  that  around  250  twinning  projects  are  operational  throughout  the  candidate
countries  at  any  one  time.  Furthermore,  the  candidate  countries  are  being  offered  the
possibility  of  drawing  on  Member  States'  expertise  through  "Twinning  light",  in  order  to
address  well-circumscribed  projects  of  limited  scope  which  emerge  during  the  negotiation
process as requiring adaptation.

An  independent  assessment  of  the  design  of  Twinning  was  conducted  in  the  spring  and
reported in July 2000. The Commission has taken on board most of the recommendations of
this  assessment  for  improvement  of  the  procedural  and  financial  rules  for  Twinning,  as
reflected in the Twinning Manual. Steps were  also taken to speed up  implementation  of the
programme.

– 

TAIEX

The  establishment  of  the  TAIEX  Unit  within  DG  Enlargement  became  a  reality  in  Spring
2001. In parallel,  a new tendering  process was undertaken to replace the  Bureau Assistance
Technique  with  a  new  contractor  to  provide  commercial  services  to  the  Unit  through  a
framework contract operating a Special Fund.

2001  was  a  year  of  increases  in  both  the  range  of  services  and  the  number  of  Candidate
Countries receiving support from TAIEX.  A total  of 492  events  were  held in 2001,  ranging
from  seminars  and  workshops  with  the  participation  of  all  Candidate  Countries,  to  expert
exchange programs and study visits of administrative staff to Member State administrations.

A large proportion of events dealt with issues related to agriculture, financial and institutional
matters  and  environmental,  consumer  and  health  protection.  In  total  2,048  experts  were
mobilised from the Member States and 11,257 participants attended TAIEX events from the
candidate countries.

New services were started leading to a number of new initiatives. Amongst these were:

The  Regional  Training  Programme  whereby  selected  candidates 
regional
administrations  are  being  trained  to  develop  local  training  arrangements  to  support  the
implementation of important sectors of the acquis at the local level.

from 

A  Ports  and  Border  Management  Programme  to  support  the  application  of  border  related
acquis  through  training  and  co-operation  between  the  concerned  services,  starting  with  sea
and river ports, this followed the conclusions of the very successful TAIEX Ports Conference
held in co-operation with the Bremen Land in December 2000.

Business  weeks  for  the  private  sector,  to  allow  an  increased  opportunity  for  the  business
community and social partners to discuss the implications of the application of the EC acquis
in individual Candidate Countries.

The Parliament Programme which is providing “question and answer” sessions in Brussels
for  the  Candidate  Countries’  National  Parliamentary  Committees  as  well  as  an  exchange
scheme for officials with Member States National Parliaments.

10

Introduction  of  the  TAIEX  Expert  Stock  Exchange  allowing  a  more  transparent  and
effective  system  for  notifying  requests  for  experts  and  study  visits  to  Member  State
administrations and posting their offers back to Candidate Countries.

(cid:1)  Support to investment

The 1999 guidelines called  for  investment  support to  be  re-oriented to  take  account of  the
launching  of  ISPA  and  SAPARD.  Investments  accounted  for  63  per  cent  of  the  resources
committed  within  the  national  programmes  in  2001  –  27  per  cent  of  which  was  for
investments in the regulatory structures to implement the acquis.

Moreover,  the  Phare  Review  underlined  the  need  to  assist  candidate  countries  prepare  for
Structural Funds. The Commission continued to expand its support for economic and social
cohesion in 2001 (accounting for 36 per cent of total national programme commitments) and
to move towards the approaches required for Structural Funds as quickly as is sustainable and
feasible, taking into account the specific features of each candidate country.

To this end, in 2001, € 57 million of institution build ing resources were targeted at authorities
or bodies responsible  for the  preparation  and  implementation  of  Structural  Funds  assistance
on accession and investment funds amounting to € 394 million were devoted to investment in
economic  and  social  cohesion  to  pilot  test  approaches  for  Objective  1  actions,  relying  to  a
larger  extend  on  a  programme  oriented  approach.  Moreover,  the  process  of  preparing
National  Development  Plans,  to  underpin  programming  of  investment  in  economic  and
social cohesion and to prepare for Structural Funds, has been accelerated and programming
for  CBC  has  been  more  closely  aligned  with  the  National  Development  Plans  and  moved
towards Interreg.

2.5.

Phare Cross-border co-operation

The Phare CBC Regulation of December 1998 has introduced substantial changes in the way
cross-border  co-operation  programmes  operate,  aimed  at  aligning  Phare  CBC  with  Interreg
practices. In this context, the introduction of Joint Programming Documents and the set up of
joint  structures  (i.e.  the  Joint  Co-ordination  Committees)  represented  a  quantum  leap  in
moving towards Interreg.

Further  improvements  in  better  aligning  the  Phare  CBC  programme  with  Interreg  were
introduced at  the  end  of  2000,  in  the  context  of  the  Communication  "Phare  2000  Review  –
Strengthening  preparation  for  enlargement".  These  are  currently  put  into  practice  in  the
context of the Joint programmes for 2000-2006.

Improvements  include  multi-annual  indicative  financial  allocations  per  border,  and  a
programme  oriented  approach  for  Phare  through  the  introduction  of  "grant  schemes".  The
latter  allows  for  a  more  decentralised  implementation  of  Phare  projects,  which  would  be
similar in size and nature as for Interreg, provided candidate countries are capable of running
"schemes" instead of stand alone projects.

Two  types  of  "schemes"  co-exist:  Small  Project  Funds  for  grants  below  50.000  €,  and
Economic and Social Cohesion schemes for grants between 50.000 € and € 2 million.

On all borders, Small Project  Funds (SPF) continued to operate or were  established, using
between 10 and 20 percent of the total programme's appropriation. "People to People" actions
in  areas  such  as  culture,  education,  information,  local  economic  development  and

11

employment,  supported  under  the  SPF,  further  enhanced  the  involvement  of  local  and
regional authorities in cross-border co-operation.

Schemes for grants between 50.000 € and € 2  million are implemented in the  framework of
Economic and Social Cohesion support in one of the areas of human resources development,
support to productive sector and business related infrastructure.

In the year 2000-2002, Phare-CBC has an annual budget of € 151 million, allocated between
the different candidate  countries  taking objective  criteria  into  account  (population,  GDP  per
capita and surface of the border regions concerned). Another element to be taken into account
was the need for a balance on both sides of the border,  and a two third/one third repartition
between EU-CC and CC-CC borders, as provided in the budgetary comment. In 2001 Phare-
CBC programmes are operational at 14 borders. Moreover, a further € 12 million is allocated
to  the  Baltic-CBC  programme  (Poland,  Latvia,  Lithuania,  Estonia)  where,  given  the
peculiarity of the Baltic Sea area, a transnational approach in conjunction with the Interreg III
B programme must be followed.

Joint Programming Documents covering the 2000-2006 period, were established for each EU-
CC border (here in the form of joint Phare CBC/Interreg programming documents) and each
CC-CC border (except the Baltic Sea areas). In the Baltic Sea area, the joint CBC/Interreg III
B  programming  document  was  approved  by  the  Commission  in  June  2001.  The
implementation of the Joint Programming Documents reached the cruising speed in the course
of 2001.

2.6.

Multi-beneficiary programmes

SME Finance Facility

The  SME  Finance  Facility’s  objective  is  to  persuade  financial  intermediaries,  i.e.  banks,
leasing companies or investment funds in the central European candidate countries to expand
and  sustain  their  financing  operations  to  SMEs.  In  order  to  help  financial  intermediaries
overcome  their  lack  of  experience  and  to  cover  the  special  administrative  costs  and  risks
involved, the Facility provides them with access to finance and with specific incentives. The
Facility is sponsored by International Financial Institutions (IFI), namely the European Bank
for Reconstruction and Development (EBRD), the European Investment Bank (EIB) and the
Council of Europe Development Bank/Kreditanstalt (CEB/KfW).

Facility  Projects  are  set  up  under  two  co-ordinated  Windows:  the  Loan,  Guarantee  and
Leasing Window and the Equity Window, and take the form of loan or equity finance for the
FIs, combined with tailored packages of financial incentives. The financial intermediaries on-
lend or lease to individual micro-enterprises or SMEs, or provide them with equity finance. In
certain  cases,  the  financial  intermediaries  also  channel  additional  funds  from  their  own
resources to the recipient businesses.

Following a start-up Phase I launched by the Commission and the EBRD in April 1999, the
Facility entered into its Phase II in 2001, with € 30 million each allocated to the EBRD and
CEB/KfW.  In  addition,  the  Commission  decided  to  include  the  EIB  amongst  the  Sponsors
equally  for  an  amount  of  €  30  million  and  to  extend  the  reach  of  the  Facility  to  Turkey
through a € 4 million co-operation with CEB/KfW.

12

As per the end of 2001 the financial status of the programme was the following:

BUDGET

Loan, Leasing and Guarantee Window (€

 M)

EW

EU/EBRD

EU/CEB/KfW

EU/EIB

EU/EBRD

TOTAL

Phare EBR
D

Phare CEB/
KfW

Phare EIB Phare EBRD

1999

2000

2001

TOTAL

25

30

30

85

125

150

150

425

0

21

30

51

0

113

150

263

0

0

30

30

0

0

300

300

25

25

0

0

0

0

200

314

690

25

 25

1,204

BUSINESS SUPPORT PROGRAMME

The programme was set up to strengthen the role of business representative organisations in
the central European candidate countries so that they could assist business operators in these
countries to adapt to the challenges of accession to the EU, and in particular to the  changes
arising  at  company  level  as  a  result  of  the  need  to  adapt  to  the  Community  acquis.  To  this
end,  support  was  given  to  the  development  of  partnerships  and  twinning  operations  with
sectoral and horizontal business representative organisations in the existing Member States.

17 projects - supported through grants amounting to a total of € 22 million - covered a wide
range of business sectors and activities including chambers of commerce; small and medium
sized  craft  enterprises;  the  furniture  and  wood  industry;  producers  co-operatives,  social
enterprises  and participative  enterprises; the  chemical industry;  the  food and  drink  industry;
the  iron  and  steel  industry;  the  textile  and  clothing  industry;  animal  production;  and  the
information and communication technology industry.

The projects focused on topics such as reinforcing the democratic and independent operation
of  business  representative  organisations;  developing  the  efficiency  of  these  organisations  as
interest groups at national and international level; assisting businesses in the central European
candidate  countries  understand  the  Internal  Market  and  adapt  themselves  to  the  related
Community acquis; and on providing know-how about corporate development.

The Business  Support  Programme  also  provided  support  for  2  special  projects  –  the  first  in
the area of industrial property, and the second for the benefit of representative organisations
in the agricultural sector.

In most cases, the projects have supported the development of a practical approach on how to
adopt  the  acquis;  conferences,  seminars,  workshops,  training  and  consulting  missions
represent  the  main  types  of  project  activities  undertaken.  In  addition,  almost  all  projects
organised internships and secondments of representatives from business support organisations
in  the  candidate  countries  to  similar  organisations  in  the  EU  or  to  the  European  umbrella
organisation. Other activities that have been carried out – or that are planned – include needs
assessment surveys,  development  of  platforms  for  statistical  data  exchange,  development  of

13

extranet/intranet  sites,  making  available  on-line  specific  information  on  the  acquis,  and  the
preparation of tenders to other EU programmes.

Results  and  outcomes  achieved  to  date  suggest  a  general  improvement  in  the  level  of
knowledge and awareness on subjects related to EU accession as well as an understanding of
the role and responsibility of business support organisations in the EU.

ENVIRONMENTAL PROGRAMME

2001 saw the closing of 3 accession-driven initiatives which had started in 1999:

– 

– 

– 

the sustainable nature protection project (€ 1.9 million);

ad  hoc  assistance  to  the  central  European  candidate  countries  in  preparation  for
membership of the European Environment Agency (€1.6 million);

Black  Triangle  inventory  of  situations non-compliant with selected EU Directives
(€ 0.5 million)

and  the  implementation  of  the  €  6.25  million  Regional  Environmental  Accession  Project
(REAP). REAP activities aimed to enhance compliance with EU environmental legislation in
a number of sensitive areas such as air quality, water quality, waste management, etc. and in
particular at improving levels of implementation capacity. In addition, an award scheme and
guidance  were  provided  to  municipalities  in  the  central  European  candidate  countries,  to
whom  the  responsibility  of  implementing  many  of  the  directives  has  been  devolved.
Furthermore, REAP helped to build the networks needed to ensure that NGOs and the general
public are better informed and integrated in the approximation process.

PHARE HORIZONTAL PROGRAMME JUSTICE AND HOME AFFAIRS

In order to strengthen the administrative capacity of the judiciary and law enforcement bodies
in the central European candidate countries, the programme financed assistance in the fields
of

(cid:1)  “judicial co-operation  in criminal matters” (€  1.5  million).  The  project  addressed  issues

such as extradition, mutual legal assistance and confiscation;

(cid:1)  “rule of law” (€ 3.1 million). The project focused on four  aspects of the functioning of the
judicial  systems  in  the  10  central  European  candidate  countries:  an  independent  judicial
system;  the  status  and  role  of  the  public  prosecutor;  court  procedures  and  execution  of
judgements; safety of victims, judges, prosecutors, defence lawyers and jurors;

(cid:1)  “migration, visa, and external border management” (€ 3.0 million). The project dealt with
issues related to the functioning of an immigration service, detention, expulsion and return;
with  visa  policy  and  practises;  and  with  the  Schengen  acquis  and  combating  illegal
immigration networks

It also supported the “training of judges in EC law” (€ 1.3 million).

The projects were implemented by the European Institute of Public Administration (training
of  judges)  and  consortia  of  Member  States  who  made  available  professional  staff  and
practitioners from their own governmental departments as well as project management teams.

14

The  project  on  the  training  of  judges  aimed  at  establishing  a  training  scheme  and
methodology for each central European candidate country and to provide a common practical
manual for judges on EC law.

All  other  projects  were  built  according  to  a  common  structure:  a  desk  research  phase  was
followed by fact-finding and assistance missions by Member State officials to the beneficiary
countries.  The  joint  work  of  experts  from  the  beneficiary  countries  and  the  Member  States
was intended to lead to “Recommendations” or “National Action Plans” with clear indications
of practical steps that the candidate countries  agreed to take after the end of the projects. In
addition, these projects also included  a  number  of  training  seminars  based  on  the  “train  the
trainers” concept.

The implementation of the Phare Horizontal Programme Justice and Home Affairs continued
into 2002.

FIGHT AGAINST DRUGS PROGRAMME

The EU Action Plan on Drugs 2000-2004 adopted at the Feira European Council called on the
Commission  and  the  Council  to  ensure  that  the  candidate  countries  adopt  the  Community
acquis and best practice in the field of the fight against drugs, and that their implementation is
satisfactory.

In view of this objective, projects under the Fight Against Drugs Programme were constructed
along similar lines as those under the Phare Horizontal Programme Justice and Home Affairs,
with Member States providing expertise and project management resources.

Phase  V  of  the  Phare  Precursors  Project  (€  1.3  million)  brought  a ssistance  in  drafting
compatible  legislation  and  provided  training  and  equipment  aiming  at  strengthening  the
administration and enforcement of precursor controls. The Phare Synthetic Drugs Project (€ 2
million)  started  to  strengthen  the  candidate  countries’  capacities  to  reduce  the  illegal
manufacturing  and  trafficking  of  synthetic  drugs  through  awareness  raising,  training  on
analysing synthetic drugs and exercises on dismantling illicit laboratories. Its major outcome
were the  National  Synthetic  Drugs  Plans  of  Activities,  which  set  the  framework  for  actions
needed  in  the  near  and  mid-term  future  in  the  area  of  supply  reduction  of  synthetic  drugs.
Both projects ended in December 2001.

The  Joint  UNDCP-Phare  Drug  Law  Enforcement  Project  for  South-Eastern  Europe  (€  4.5
million)  implemented  by  UNDCP  ended  in  December  2001.  It  enhanced  regional  and  sub-
regional  networking  of  national  capacities  for  dismantling  drug  trafficking  organisations,
disrupting  drug  supply  channels  and  detecting  illicit  drugs  at  border  crossing  points  and  in
transit.  In  addition  to  Bulgaria  and  Romania,  the  former  Yugoslav  Republic  of  Macedonia
also participated in this project.

Finally, the € 2 million project  EMCDDA – CEEC co-operation started in February 2001. The
project  aims  at  integrating  the  12  candidate  countries  in  the  activities  of  the  European
Monitoring  Centre  for  Drugs  and  Drug  Addiction  (EMCDDA)  and  establishing  structural
links  with  the  REITOX  network  (Réseau  européen  d’information  sur  les  drogues  et  les
toxicomanies). The National Focal Points are being further strengthened, institutionalised and
further  prepared  to  participate  in  such  activities  through  a  strong  institution  and  capacity
building component.

15

ECOS-OUVERTURE PROGRAMME

The programme’s aim is to strengthen local authorities in Central and Eastern Europe through
co-operation with EU counterparts, particularly those in the less-favoured areas of the Union.
This  interregional  support  measure  encourages  co-operation  between  relevant  authorities
through joint projects for the exchange of experience and know-how. Originating in 1990 it
has been financed by Phare and ERDF since 1994.

2001  was  the  first  full  year  for  the  implementation  of  32  projects  financed  under  the  Phare
1998  budget  for  a  total  amount  of  €  7.35  million.  The  main  themes  of  co-operation  are
economic  development  (18)  and  environment  (7)  while  the  remaining  projects  focus  on
cultural  (4)  or  administrative  (3)  aspects.  With  an  average  budget  of  €  244.440  the  Phare
partners  play  a  more  significant  role  in  the  projects  than  in  the  earlier  generations  of  the
programme.  One third  of  all  projects have  two or more  partners  from  the  Phare  beneficiary
countries.  Romanian  authorities  are  best  represented  in  the  programme  and  involved  in  11
different project. This is closely followed by Hungarian (7) and Slovenian (6) partners.

The projects last between 24 and 36 months; project activities end in the second half of 2002.

STATISTICS

The wider objective of the Phare Multi-Beneficiary Programme for statistical co-operation is
to improve the provision of official statistics from Phare candidate countries, especially in the
context  of  pre-accession.  Substantial  allocations  from  the  Phare  budget  were  given  to  this
programme and its objectives over the period 1991-1999. In 2000 a strategic document  was
developed  in  order  to  define  a  strategy  on  how  to  work  towards  the  objective  of  achieving
compliance with the acquis in statistics with the support of the Phare programme.  Based on
this  strategy,  which  was  developed  in  close  co-operation  and  with  the  participation  of
Eurostat, the  candidate  countries  themselves,  member  states,  international  organisations  and
other donors and covers the  years 2000-2002, the 2001 Multi-Beneficiary Phare programme
was elaborated by Eurostat and endorsed by the Phare Management Committee in September
2001.

The  2001  programme  is  oriented  towards  strengthening  the  institutions  of  the  National
Statistical Institutes (NSI) of the candidate countries to enable them to better meet the needs
of their customers, to provide reliable, accurate and timely data compliant with the acquis, to
improve the quality of available statistics and to reinforce the confidence into statistics. The
programme also contains a part on measuring the degree of compliance in the area of statistics
in the candidate countries. The total budget provided for this programme is Euro 7.39 million.

The programme contains various types of projects. The most important ones are the sectoral
projects covering gaps still existing in the acquis implementation or coping with new acquis
requirements.  In  this  programme  several  projects  on  macro-economic  statistics,  business
statistics, social statistics, agriculture statistics and external trade statistics were included and
their implementation  started  in February 2002. The total budget for these projects is around
€ 3.4 million.

Another important part of the programme contains all the statistical assistance activities like
participation in Eurostat’s working  groups,  seminars, training courses, seconding trainees to
Eurostat or a Member State statistical office and implementing study visits and consultations.
This part of the programme has a budget of  € 3.5 million.

16

The third part of the programme covers the aspect of compliance monitoring via a tool called
the compliance database and has a budget of  € 0.5 million.

The  implementation  of  this  programme  has  started  in  February  with  contracting  for  the
sectoral projects whereas the budget for statistical assistance activities will be given as grants
to  both  the  Member  States’  and  candidate  countries’  statistical  offices.  Compliance
monitoring  will  start  in  September  2002.  All  the  various  projects  will  be  accomplished  in
spring 2004.

It is expected that they will contribute to the further alignment of the statistical systems of the
candidate  countries  to  European  standards.  Projects  will  result  in  a  better  capacity  of  the
statistical offices to provide data in full compliance with the acquis in the selcted areas of co-
operation.

LIEN PROGRAMME

The  LIEN  (Link  Inter  European  NGOs)  Programme  wants  to  stimulate  the  activity  of  and
encourage the co-operation  between  non-profit  making  non-governmental  organisations  that
are active in the social field and to assist  the disadvantaged  groups of the population. Since
1992 216 projects have been selected and received Phare grants totalling about € 31 million.

40  projects  that  had  been  selected  during  the  last  LIEN  Call  for  Proposals  in  1999  were
implemented  in  2001.  These  projects  covered  all  Phare  beneficiary  countries  as  well  as
Albania, Bosnia-Herzegowina and the former Yugoslav Republic of Macedonia.

A  large  part  of  the  projects  (14)  were  implemented  by  NGOs  working  for  the  benefit  of
women  with  limited  access  to  health  and  employment,  youngsters  and  elderly  as  well  as
ethnic  minorities  (14  projects).  Another  15  projects  were  related  to  help  for  the  disabled
(blind, physically and mentally disabled), the sick (HIV) and addicts (drugs). The remaining
funds  were  used  to  support  employment-projects  (5)  or  other  projects  (6)  such  as  mine
awareness training camps in Bosnia-Herzegowina.

PARTNERSHIP PROGRAMME

The  Partnership  Programme  has  been  endowed  with  Phare  funds  since  1993  to  promote
dialogue and co-operation on matters of local development between private and public non-
profit organisations in the countries of  central and  eastern  Europe.  It  provides  grant-finance
for local development projects initiated by at least two non-profit  organisations that  wish to
build  a  sustainable  partnership  with  a  view  to  mutually  exchange  skills,  knowledge  and
experience.

The majority  of  the 52  projects funded under the 1997 Partnership programme for a total of
€  9.75  million  closed  in  2001.  The  projects  of  this   last  Partnership  generation  showed  a
particular focus on:

– 

– 

local and regional development (improvement of local and regional services, regional
planning, rural and agricultural development, tourism);

business and enterprise development;

17

– 

socio-economic  development  (promotion  of  workers  rights  and  social  dialogue,
promotion  of  consumer  interests,  strengthening  of  associations  representing  co-
operatives and other).

Many  of  the  projects  will  continue  to  carry  out  their  activities  under  funding  from  other
sources such as the European Commission’s ACCESS programme or national sources.

ACCESS PROGRAMME

The  Access  Programme  aims  at  strengthening  civil  society  in  the  candidate  countries  by
promoting  the  implementation  of  the  acquis  communautaire  in  policy  areas  in  which
governmental activities are absent or are complementary to those of the third sector as well as
by  raising  popular  awareness  and  acceptance  in  these  areas.  Moreover,  the  inclusion  and
participation  of  individuals  and  groups  who  risk  being  economically,  socially  of  politically
marginalised in the transformation process shall be encouraged through the activities financed
under Access. The programme may support activities in the following sectors: environmental
protection, socio-economic development and social activities.

ACCESS  provides  co-financing  grants  to  support  projects  carried  out  by  non-governmental
organisations  (NGOs)  and  non-profit  organisations  (NPO).  Macroprojects  are  carried  out  in
partnership with organisations from at least two different countries (Phare accession countries
and  the  EU  countries),  whereas  microprojects  can  be  carried  out  by  a  single  organisation
based in one of the candidate countries. Furthermore, the programme includes a Networking
Facility, which provides support for NGOs/NPOs in the candidate countries to participate in
activities organised at EU level.

During the year 2001, 463 projects for a total of € 16.77 million (out of a total of € 19 million
available  for  grants)  started  to  be  implemented  under  Access  1999  in  the  ten  countries  of
Central and Eastern Europe. The implementation of activities financed by the remaining funds
as well as of Access 2000 takes place in 2002.

2.7.

Participation in Community programmes and Agencies

In the Agenda 2000, the European Commission proposed the progressive opening-up to the
candidate countries of a broad range of Community programmes, as one of the intermediate
objectives  of  accession,  without  waiting  for  the  accession  date.  It  was  also  proposed  active
participation  in  certain  Community  agencies  or  bodies  in  order  to  prepare  these  countries
better for adoption of the acquis.

As the Community programmes encompass most Community policies, they provide a useful
preparation for accession by familiarising the  candidate countries and their citizens with the
Union’s  policies  and  working  methods.  Since  1998,  candidate  countries  in  Central  and
Eastern Europe have participated fully in Community programmes, in particular in education,
vocational training, youth, research, energy, the environment, small and  medium-sized
enterprises.  The  participation  of  candidate  countries  in  Community  programmes  is  a  key
feature of the pre-accession strategy.

(cid:1)  Concerning programmes

Following  the  new  legal  instruments  proposed  by  the  Commission  to  the  Council  in
November  2000  in  order  to  streamline  Community  legal  procedures  and  consequently

18

facilitate  candidate  countries’  participation  in  Community  programmes,  substantive
progress has been made towards the implementation of these new procedures in 2001.

In  most  cases  and  at  the  candidate  countries’  request,  the  cost  of  this  participation  is  co-
financed by Phare. In 2001, Phare committed € 111.6 million  for the participation of the 10
central  and  eastern  European  countries  in  Community  programmes,  amounting  to  46%  of
their total financial contribution. The majority of these funds are made available on the basis
of “frontloading”, i.e. for the participation of candidate countries in Community programmes
in the year 2002.

(cid:1)  Concerning Agencies

Similar participation of candidate countries in Community agencies is taking place.

In this context, bilateral agreements were negotiated with all 13 candidate countries for their
participation  in  the  European  Environment  Agency.  Bulgaria,  Slovakia,  Malta,  Cyprus,
Latvia,  Slovenia,  Hungary,  Lithuania,  Romania,  Estonia  and  the  Czech  Republic  have
successively  ratified their  respective membership  agreement.  In 2001, Phare  contributed  €
2.15  million  for  the  participation  of  the  CEECs  in  the  European  Environment  Agency  in
2002, i.e. 58% of their total financial contribution.

On 2001 the Commission has proposed to open negotiations on the participation of candidate
countries in the European Monitoring Centre for Drugs and Drug-Addiction.

With  respect  to  other  Agencies,  it  has  been  decided  to  prepare  now  future  participation  of
candidate  countries.  Preparation  for  full  participation  in  Community  Agencies  is  a
fundamental  step  towards  familiarising  these  countries  with  the  Community  acquis  in  the
broad  sense  of  the  term.  It  could  serve  the  interests  of  both  the  Union  and  the  candidate
countries.  This  involvement  will  take  the  form  of  participation  of  representatives  of  these
countries  in  some  ad  hoc  meetings,  groups  of  experts  and  other  specific  work  of  mutual
interest being carried out by the Agencies.

To  this  purpose,  €  5  million   had  been  allocated  in  2000  as  Phare  support  to  implement
preparatory  measures  in  2000-2001  as  regards  the  10  CEECs’  participation  in  five
Community agencies.

2.8.

Co-operation with the EIB and international financial institutions

Co-operation  with  the  EIB  and  IFIs  continued  in  2001  under  the  framework  of  the
Memorandum  of  Understanding  on  co-operation  in  the  pre-accession  assistance.  Given  the
fact that large infrastructure projects that commonly are subject to international co-financing
are now financed under  ISPA, co-financing under Phare was very limited. The Commission
was, however, exploring ways to co-finance the Economic and Social Cohesion component of
the Phare programme with the IFIs.

The  main  co-financing  instrument  in  2001  was  again  the  SME  Facility  which  the  EIB  was
about to join, in addition to the EBRD and Council of Europe Development Bank / KfW. In
2001,  the  Commission  also  started  discussions  with  the  EIB  on  a  Facility  to  finance  local
municipalities  in  border  regions,  as  outlined  in  the  Commission  Communication  on  Border
Regions (of 25 July 2001, COM(2001)437final).

19

3.

PROGRAMME MANAGEMENT

3.1.

Moving towards extended decentralisation (EDIS)

Since  2000,  the  Commission  initiated  the  process  of  extending  PHARE  decentralisation  in
order to reinforce the capacity of the candidate countries to manage pre-accession assistance
and  to  familiarise  themselves  with  the  joint  responsibility  principles  that  underpin  the
implementation of the Structural Funds.1

In  order  to  guide  the  preparatory  work  of  the  candidate  countries  a  Commission  Working
Document  “Preparing  for  Extended  Decentralisation"  has  been  drawn  up.  This  document
indicates in more detail how the European Commission interprets the criteria and conditions
in the Co-ordination Regulation No. 1266/99 and provides checklists for use by the relevant
bodies.  Respect  for  the  EDIS  checklist  is  a  key  step  for  candidate  countries'  structures  in
showing capacity to manage the future Structural and Cohesion Funds;

A  further  document  entitled  "Road  map  to  EDIS  for  ISPA  and  Phare",  transmitted  to
candidate countries in 2001, outlined the procedural stages to be undertaken by implementing
structures  to  meet  EDIS  requirements,  thus  to  receive  formal  Commission  accreditation  to
operate in ex-post mode. This document is a guide to the four stages to be accomplished: Gap
assessment  of  the  target  institutions,  and  national  procurement  procedures,  preparation  for
EDIS,  compliance  assessment  and  the  work  to  be  carried  out  for  the  preparation  for
Commission decision. With the acceleration of the negotiation process, it appeared crucial to
speed  up  the  efforts  made.  Extended  decentralisation  of  management  responsibilities  to  the
national authorities was considered by  the  European  Commission  as  a  high  priority  and  the
Candidate Countries are strongly encouraged to move toward EDIS and are supported in this
process.

The  objective  of  the  Commission  is  that  Candidate  Countries  likely  to  join  the  EU  in  2004
will have the Extended Decentralisation Implementation System (EDIS) in place at the latest
on the first day of accession. The Candidate Countries concerned have in general initiated the
first steps of the first stage of the implementation of EDIS, the ‘gap assessment’.

The  Commission  made  available  funds  in  order  to  support  and  guidance  the  Candidate
countries to identify the areas in which  the  structures  and procedures  are  not  yet  capable of
fulfilling the requirements for EDIS, to assist in the necessary developments to remedy such
shortcomings, and to assess that the necessary improvements have been completed prior to the
submission to the European Commission of a formal request for EDIS.

3.2.

Monitoring, Assessment and Ex-post Evaluation

The objectives of Phare Monitoring and assessment/scheme (introduced in 1996) are twofold:
(1)  to  provide  an  independent  analysis  of  the  effectiveness  of  on-going  programmes,
describing  the  success  of  the  programmes  in  achieving  their  objectives,  the  performance  of
the  parties  involved  and  the  capacity  of  Candidate  Countries  to  absorb  the  acquis
communautaire; and (2) to disseminate the lessons of experience with a view to improving the
implementation of current programmes and the design of future programmes.

The  Scheme  is  essentially  a  management  tool  which  provides  Phare  programme  managers
with facts on the implementation of on-going programmes and an evaluation of the progress

1 

SAPARD is from the beginning implemented on a decentralised basis.

20

                                                
and likelihood of  a  programme’s  success  in  achieving  the  objectives  set.  Recommendations
are  put  forward  for  improving  management  and  delivery,  as  well  as  the  design  of  similar
future programmes. The reports are also used when an Ex-post Evaluation is carried out on a
particular sector. By the end  of  2001,  some  600  reports  had  been  produced,  covering  all
sectors in all Phare Programme recipient countries.

The M&A (a) adopts an inclusive approach in which all parties involved in the programming
and implementation of Phare programmes/projects participate,  (b) Operates on  an integrated
in  particular  with  programme  preparation,  contracting  and
approach  which 
implementation, and (c) follows a  result-oriented methodology in  line with  the Commission
Reform White Paper.

links 

The findings from the M&A feed into the Phare programming system by way of the improved
and uniform progress reporting across all programmes and countries, more rapid introduction
of corrective measures if required and the exchange of the lessons of experience between the
Commission  and  the  Candidate  Countries.  The  increased  flow  of  feedback  information
improves  the  design  of  subsequent  programmes  and  assist  decision-makers  at  the  approval
stage.

M&A  remains  an  essential  component  of  the  Phare  Decentralised  Implementation
System  providing  all  parties  involved  in  programme  management  and  implementation  with
sound  information  on  how  the  various  programmes  are  progressing,  on  whether  the
programmes are achieving their objectives and on their relevance to the Phare objectives and
accession priorities defined in the AP and NPAA.

M&A  reports  of  national  on-going  programmes  are  produced  by  independent
assessment/evaluation  cells  established  in  each  country  (external  contractor)  while  multi-
country programmes are carried out by a central unit based in Brussels. Each evaluation cell
must also submit a half-yearly report to ELARG, detailing activities over the past six months
and drawing attention to overall trends in the implementation of Phare sectoral programmes.

The procedure of producing M&A reports is an entirely participatory process which can only
properly  function  with  the  active  participation  of  the  stakeholders  in  the  management  of
programmes being reviewed. The evaluators work on the basis of the relevant monitoring data
and  carry  out  interviews  and  field  visits  to  evaluate  the  information  contained  in  the
monitoring  reports  and  other  sources.  M&A  reports  contain  management  and  design
recommendations, in line with the accession priorities defined in the AP and NPAA.

A follow-up process of recommendations and feedback within the Phare management system
completes the Evaluation cycle. Once a  report is issued, a debriefing meetings organised by
the Commission’s delegation in each country, when interested parties agree on the ways and
means of applying recommendations made, as well as an appropriate timetable.

M&A reports together with SMSC and debriefing meetings’ minutes are handed over to the
JMC which is responsible for reviewing the progress of all Phare programmes implemented in
the  respective  country,  once  a  year  (as  well  as  ISPA  and  SAPARD  programmes  through
annual reports submitted to the JMC by the respective Monitoring Committees).

Based  on  the  M&A  reports,  the  JMC  proposes  remedial  actions  to  improve  the  programme
management and design of future projects and puts forward measures to facilitate the progress
of Candidate Countries in absorbing the acquis communautaire.

21

In order to be in line with the Structural Funds system, the Assessment function was renamed
as Interim Evaluation.  The  revised  Interim  Evaluation  Scheme  became  effective  in  the  3rd
quarter  of  2001.  The  revision  was  based  on  the  Candidate  Countries  assuming  entire
responsibility for reporting on facts by issuing Monitoring Reports twice a year for all sectors,
as  a  bridging  step  towards  the  management  of  Structural  Funds.  The  interim  Evaluation
function will remain under the responsibility of the Commission.

During  the  year  2001,  85  Monitoring  and  assessment/Interim  Evaluation  reports  have
been issued covering all sectors of Phare assistance. These reports have been produced by an
independent external contractor, the OMAS and EMS Consortium. The EMS Consortium
operates  offices  staffed  with  EU  and  local  evaluators  in  Bulgaria,  Czech  Republic,  Estonia,
Hungary,  Latvia,  Lithuania,  Poland,  Romania,  Slovak  Republic  and  Slovenia.  The  EMS
central  office  in  Brussels  is  responsible  for  evaluating  multi-country/multi-beneficiary
programmes.

DG Elarg Directorate D operates a quality support function for the Country Teams providing
programming  guidance,  peer  review  and  comments  on  financing  proposals.  To  ensure  that
this support adds value to the programming authorities, a greater emphasis was placed in 2001
in preparing Horizontal and Thematic reports presenting lessons learned on key areas such as
twinning,  Transition  towards  Structural  Funds,  Justice  and  Home  Affairs,  SMEs,  Public
Administration  Reforms.  These  reports  should  assist  programmers  to  learn  of  current  best
practices,  lesson  learned  from  past  Phare  support  and  Structural  Funds  approaches.  In
addition, Country Assessment Reviews were prepared  for all the Phare  Candidate Countries
that  consolidated  the  findings  of  all  the  monitoring  and  assessment  reports  on  a  sector  by
sector basis for the period 1996-2001.

Ex-post Evaluation

Ex-Post evaluation delivers an “external” view on the achievements of the Phare programme
or of its components. The reports are, at present, particularly concerned with reporting the use
of  Community  funds  and  focus  on  the  impacts  achieved  and  the  sustainability  of  such
impacts.

From  the  Commission’s  point  of  view  the  ex-post  evaluation  reports  are  important
instruments  for  reporting  to  other  Institutions  such  as  Council  and  Parliament  the  results
achieved  as  a  result  of  spending  the  Community  budget.  The  exercise  of  ex-post  reporting,
with  emphasis  on  the  impacts  and  the  sustainability  of  programmes  is  a  Commission
responsibility  which  has  recently  been  reinforced.  It  brings  an  important  “results  oriented”
dimension to reporting the use of Community funds.

Before 2000, under AidCo, the ex-post evaluation of Phare was mainly sector oriented. The
most  recent  ex-post  evaluation,  that  was  launched  by  Dg-Elarg  in  2001  concentrates  on
evaluating the impacts and the sustainability of the results achieved using € 1,000 million of
Community funds programmed during the 1997 and 1998 period. This funding represents the
major  EC  commitment  to  the  Candidate  Countries  during  the  period  under  the  Accession
Partnership in  support of their implementation of  National Programmes for  Adoption of the
Acquis.

Tasks ahead

The Interim Evaluation Scheme will be extended to Cyprus, Malta and Turkey in 2002.

22

A  revision  of  the  Interim  Evaluation  Scheme,  and  templates  for  monitoring  reports  is  also
foreseen  as  a  major  task  during  2002.  The  key  purpose  of  the  revision  will  be  to  further
strengthen  the  value  added  of  the  system  supported  by  a  number  of  quality  enhancing  and
streamlining measures. The following key measures are under consideration:

– 

– 

– 

– 

– 

Revision of the evaluation methodology;

A substantial revision of the format/presentation of the evaluation reports;

Further  quality  enhancement  of  the  evaluation  system/reporting  by  establishing  a
quality assurance group;

Establishment  of  local  focal  points  for  interim  and  ex-post  evaluation  will  help  to
strengthen the current system in particular but also to serve as a focal point to help to
develop local capacity of monitoring and evaluation in general;

Strengthening  of  dissemination  including  early  warning,  in-depth  reports,  country
summary reports, thematic reports and project drafting workshops.

In view of the requirements to further strengthen the CCs capacity of monitoring in general
and  the  Phare  programme  and  Structural  Funds  in  particular,  a  set  of  monitoring  reporting
guidelines  of  basic  requirements  accompanied  by  good  practice  templates  will  be  prepared.
Thus  in  providing  good  practice  examples  we  try  to  respond  to  the  need  of  adjusting  the
monitoring reporting system to local requirements in the Candidate Countries through a more
flexible approach.

Results from the current ex post exercise will be available in early 2003. It is also foreseen
that  the  Evaluation  Unit  will  launch  an  ex-post  evaluation  of  the  “twinning”  mechanism
which  supports  partners  in  developing  acquis  related  administrative  capacity  by  placing
Member  State  administrators  in  their  administrations  for  fixed  periods  with  identified
programmes  of  co-operation.  Taking  into  account  current  priorities  it  is  foreseen  that  there
will be further ex-post evaluation of the “Institution Building “ components of Phare support.

Evaluation web site will be created with the purpose of improving the dissemination of the
reports’  findings  and  of  increasing  internal  and  external  communication.  Subsequently,  the
outputs of the ex ante, interim and ex post evaluations will be made electronically available
for integration into the Management Information System under development in DG ELARG

23

4.

FINANCIAL OVERVIEW AND PERFORMANCE

In 2001, the Phare Programme committed a total of € 1,635.41 million to its partner countries.
The following chart shows the breakdown  year by year of the Phare funds committed in the
period 1990-20012 (€ million):

1990

475.3

1991

769.7

1992

979.6

1993

966.1

1994

946.1

1996

1997

1998

1999

2000

1995

1,114.0

20013

1,207.8

1,135.1

1,153.9

1,481.7

1,651.5

1,635.4

The situation with regard to implementation may be summarised as follows:

Total commitments 1990-2001:

€ 13,516.2 million

Total value of contracts signed 1990-2001:

€  10,155.1  million  (thus  75.1%  of  all
commitments have been contracted)

Total  payments  under  signed  contracts  1990-2001:  €  8,687.3  million  (thus  64.3%  of  all
committed funds have been paid and 85.5% of all contracted funds have been paid)

2 

3 

In year 2001, Albania, Bosnia-Herzegovina and the Former Yugoslav Republic of Macedonia did not
receive funds from Phare programmes as in the previous years.
The Phare contribution to the European Training Foundation (€ 7.6 million) and accounting adjustments
of € 7.7 million are not included in this figure.

24