Report by the Commission - Annual Report of the Cohesion Fund (2002)
Date: 2003-11-18
Institutions: European Commission
Subjects: Cohesion Fund, activity report, implementation of the budget

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 18.11.2003
COM(2003) 697 final

REPORT BY THE COMMISSION

ANNUAL REPORT OF THE COHESION FUND (2002)

   
TABLE OF CONTENTS

Foreword .................................................................................................................................... 5

Summary .................................................................................................................................... 6

1.

1.1.

General context ............................................................................................................ 9

Convergence and economic development in the beneficiary countries of the
Cohesion Fund ............................................................................................................. 9

1.1.1

Greece .......................................................................................................................... 9

1.1.2.

Spain............................................................................................................................. 9

1.1.3.

Ireland ........................................................................................................................ 10

1.1.4.

Portugal ...................................................................................................................... 11

1.2.

conditionality.............................................................................................................. 11

2.

Implementing principles and assistance granted........................................................ 12

2.1.

Coordination with other Community policies............................................................ 12

2.1.1.

Public procurement .................................................................................................... 12

2.1.2. Competition................................................................................................................ 12

2.1.3.

Environment............................................................................................................... 13

2.1.4.

Transport .................................................................................................................... 14

2.2.

Coordination with the Structural Funds: the strategic reference frameworks (CRS) 14

2.2.1.

Environment............................................................................................................... 14

2.2.2.

Transport .................................................................................................................... 16

2.3.

Implementation of the budget, commitments and payments ..................................... 18

2.3.1. Budget available......................................................................................................... 18

2.3.2. Budget implementation .............................................................................................. 18

2.3.3.

Implementation of the budget for the previous period (1993-99).............................. 20

3.

The projects and measures adopted............................................................................ 20

3.1.

Assistance from the Fund by Member State .............................................................. 20

3.1.1. Greece ........................................................................................................................ 20

3.1.1.1 Environment............................................................................................................... 21

3.1.1.2 Transport .................................................................................................................... 22

3.1.2.

Spain (including the outermost regions) .................................................................... 23

2

3.1.2.1 Environment............................................................................................................... 24

3.1.2.2  Transport .................................................................................................................... 29

3.1.3.

Ireland ........................................................................................................................ 31

3.1.3.1. Environment............................................................................................................... 32

3.1.3.2. Transport .................................................................................................................... 33

3.1.4.

Portugal ...................................................................................................................... 33

3.1.4.1. Environment............................................................................................................... 34

3.1.4.2. Transport .................................................................................................................... 35

3.2.

Technical assistance and studies ................................................................................ 35

3.2.1

Technical assistance at the initiative of the Commission .......................................... 35

4.

Monitoring, inspections and irregularities ................................................................. 36

4.1.

Monitoring: committees and missions ....................................................................... 36

4.1.1. Greece ........................................................................................................................ 36

4.1.1.1 Monitoring Committees ............................................................................................. 36

4.1.1.2. Monitoring missions .................................................................................................. 36

4.1.2.

Spain........................................................................................................................... 37

4.1.2.1. Monitoring Committees ............................................................................................. 37

4.1.2.2. Monitoring missions .................................................................................................. 37

4.1.3.

Ireland ........................................................................................................................ 37

4.1.3.1. Monitoring Committees ............................................................................................. 37

4.1.3.2. Monitoring missions .................................................................................................. 38

4.1.4.

Portugal ...................................................................................................................... 38

4.1.4.1. Monitoring Committees ............................................................................................. 38

4.1.4.2. Monitoring missions .................................................................................................. 39

4.2.

Inspections and conclusions....................................................................................... 39

4.2.1. Greece ........................................................................................................................ 39

4.2.2.

Spain........................................................................................................................... 39

4.2.3.

Ireland ........................................................................................................................ 40

4.2.4.

Portugal ...................................................................................................................... 40

4.3.

Irregularities and suspension of aid............................................................................ 40

5.

Assessment and evaluation ........................................................................................ 41

3

5.1.

5.2.

5.3.

5.4.

General ....................................................................................................................... 41

Examination and ex-ante appraisal of projects .......................................................... 41

Cooperation with the EIB when a project is considered ............................................ 42

Economic and social impact of the Fund in the Member States and on economic and
social cohesion, including employment, in the European Union............................... 42

5.5.

Harmonisation and simplification.............................................................................. 42

6.

Inter-institutional dialogue, information and publicity .............................................. 42

6.1.

Annual report for 2001............................................................................................... 42

6.1.1.

European Parliament .................................................................................................. 42

6.2.

6.3.

Information from the Member States......................................................................... 43

Commission measures on publicity and information................................................. 43

Annex I .................................................................................................................................... 44

4

FOREWORD

This  annual  report  on  the  activities  of  the  Cohesion  Fund  covers  the  calendar  year
2002.

It provides information on the third year of the 2000-2006 programming period.

The  reporting format  reflects  the  requirements of the  Cohesion  Fund Regulation.  It
has  been  adapted  to  take  into  account  the  comments  made  by  the  European
Parliament, the European Economic and Social Committee and the Committee of the
Regions.

It  is  hoped  that  it  will  also  serve  as  a  useful  reference  document  for  everyone
interested in the promotion and furtherance of the economic and social  cohesion of
the European Union.

5

SUMMARY

Budget implementation

The final amount, after indexation, of the resources of the Cohesion Fund for 2002
was €2 788 million.

During 2002, commitment appropriations were implemented at a rate of 99.9% and
only €845 000 was cancelled at the end of the year. Only €3.3 million in commitment
appropriations  was  carried  forward  from  2001  and  no  commitment  or  payment
appropriations were carried over from 2002 to 2003. This represents a considerable
improvement on the situation in previous years.

As  regards  payments,  €548  million  in  extra  appropriations  was  made  available  so
that  the  Cohesion  Fund  could  meet  applications  for  payments  from  the  Member
States.  All  the  payment  appropriations,  including  this  transfer,  were  implemented
during the year, which was a considerable improvement on the situation in 2001.

During  2002,  Spain  and  Ireland  committed  appropriations  in  excess  of  their
allocation, so offsetting below-allocation consumption in Portugal and Greece.

the 

in  2001 

While 
implementation  of  appropriations  had  concentrated  on
environmental projects (51.5% of commitment appropriations and 61.3% of payment
appropriations), in 2002 transport projects dominated (53.9% and 57.6% respectively
of total appropriations).

The  major  effort  to  clear  the  appropriations  remaining  to  be  settled  in  respect  of
projects from the previous period which had begun in 2000 was vigorously pursued
in 2002 with some 36% of the appropriations remaining to be settled at the beginning
of  the  year  being  paid  or  decommitted  during  the  year.  By  the  end  of  2002,  these
appropriations  represented  only  just  over  half  the  budget  of  the  Cohesion  Fund  for
one year. Naturally, this work will continue in 2003.

Economic environment and conditionality

The  revised  Cohesion  Fund  Regulation  (EC)  No  1164/94  makes  the  granting  of
assistance  from  the  Fund  conditional  on  compliance  with  the  macro-economic
criterion of the public deficit, which may not exceed 3% of GDP.

In  2002  Greece,  Ireland  and  Spain  continued  to  respect  that  criterion.  Only  in
Portugal  was  the  situation  different:  on  25  July  2002,  the  Portuguese  authorities
announced  that  the  public  deficit  for  2001  had  been  4.1%  of  GDP,  substantially
higher  than  the  reference  figure  of  3%.  Following  this  announcement,  the
Commission  decided  to  initiate  the  excessive  deficit  procedure  provided  for  in
Article  104  of  the  Treaty  and  the  Council  resolution  on  the  Stability  and  Growth
Pact.

On  16  October  2002  the  Commission  adopted  an  opinion  on  the  existence  of  an
excessive  public  deficit  in  Portugal  in  2001  and  two  recommendations  to  the
Council. Since the Portuguese authorities had already taken steps to put an end to this
excessive deficit through an amending budget in June 2002, the Commission did not

6

recommend  the  suspension  of  financing  from  the  Cohesion  Fund  (Article  6  of
Regulation (EC) No 1164/94 as amended). On 5 November 2002 the Council ruled
officially  on  the  excessive  deficit  in  2001  and  asked  Portugal  to  bring  its  public
deficit within the statutory limits before the end of 2002, which it did. According to
the official figures published in March 2003, Portugal’s public deficit for 2002 stood
at 2.7% of GDP.

Coordination with the Structural Funds: the strategic reference frameworks

Transport

In  2002  the  transport  sector  accounted  for  53.9%  of  total  Cohesion  Fund
commitments (€1 504 million). As in the past, the Commission insisted that the work
of the Fund should concentrate on railways.

Environment

The environment accounted for 46.1% of total Cohesion Fund commitments in 2002
(€1 287 million). The priorities in this sector remained the supply of drinking water
and the treatment of waste water and solid waste.

Information and publicity

Two  information  meetings  with  all  15  Member  States  were  held  in  Brussels,  on
27 June and 21 November 2002.

At the first meeting the Commission presented the “Guidelines for the amendment of
projects”, the 2002-03 programme for inspection and audit missions, the allocations
of appropriations for 2002 for each Member States and the payment forecasts and the
draft Regulation on financial corrections (which came into force on 1 January 2003).

At  the  information  meeting  in  November,  the  Commission  presented  the  annual
report  of  the  Cohesion  Fund  for  2001,  the  situation  as  regards  the  EEA  financial
instrument and the position of commitments in 2002.

Evaluation

Since  the  ultimate  objective  of  cohesion  policy  is  to  maximise  economic
development  and  reduce  regional  disparities  in  terms  of  per  capita  GDP  and
unemployment rates, the main question encountered in making cost-benefit analyses
of projects  is the lack of  economic  analysis or the fact that these  analyses  are  very
often poorly carried out.

This  has  led  to  the  suspension  of  a  number  of  project  proposals  whose  main  focus
was  on  financial  analysis  only.  In  this  regard,  however,  the  contribution  of  the
Commission has also been pedagogic. The relevant reports place heavy emphasis on
how to guide project promoters towards more sound evaluations in the different areas
of economic analysis found to be unsatisfactory.

In  addition,  the  financial  analysis  of  some  investment  projects  revealed  that,  after
revising  their  cost-benefit  analysis,  project  promoters  realised  that  investment
projects  actually  needed  significantly  lower  EU  contributions.  This  is  clearly  a
crucial aspect in order to maximise the effectiveness of the public money devoted to

7

the  EU  structural  policies  since  it  allows  a  larger  number  of  projects  to  be  part-
financed.  Furthermore,  many  project  reports  included  no  risk  analysis.  The
Commission has strongly advised project promoters to use this technique not only to
enhance  the  probability  of  project  success  but  also  to  improve  impact  on  regional
development.

Irregularities and the suspension of assistance

In November and December 2002, the European Anti-Fraud Office (OLAF) carried
out  joint  audits  with  DG  REGIO  in  the  four  beneficiary  Member  States  to  look  at
their  implementation  of  Commission  Regulation  (EC)  No  1831/941  as  regards  the
systems  and  procedures  for  the  notification  and  the  monitoring  of  irregularities  in
this  field.  The  conclusions  of  the  audits  will  be  sent  to  the  Member  States,  the
Council, the European Parliament and the European Court of Auditors.

Under Article 3 of that Regulation concerning irregularities and the recovery of sums
wrongly  paid  in  connection  with  the  financing  of  the  Cohesion  Fund  and  the
organisation of an information system in this field, the beneficiary Member States are
obliged  to  notify  the  Commission  of  irregularities  which  have  been  the  subject  of
initial administrative or judicial investigations.

In  2002,  two  Member  States,  Greece  and  Ireland,  notified  the  Commission  of  one
irregularity  each.  The  case  notified  by  the  Greek  authorities  involved  a  total
Community  contribution  of  €973  444  and  the  irregularity  concerned  the  failure  to
comply  with  the  rules  on  public  procurement.  The  case  notified  by  the  Irish
authorities  involved  a  total  Community  contribution  of  €5  885  and  the  irregularity
concerned  the  submission of  non-eligible expenditure. The  amount in  question  was
recovered at national level.

Under the same  Regulation, the other  two  beneficiary  Member  States  informed  the
Commission that they had detected no irregularities during the year in question.

1

OJ L 191, 29.7.1994.

8

                                                
1.

1.1.

GENERAL CONTEXT

Convergence  and  economic  development  in  the  beneficiary  countries  of  the
Cohesion Fund

1.1.1 Greece

In  December 2002 Greece  submitted the second update of its Stability and  Growth
Programme covering the period 2003-06. The 2002 update projects an annual rate of
growth of GDP of around 3.8% during the period to 2006, with a peak of 4% in 2004
and some deceleration as from 2005. The projections provided by the Programme are
based  on  the  macroeconomic  assumptions  included  in  the  2003  budget,  which  was
adopted by the parliament in December 2002.

The 2002 update states that the Greek government will continue to follow stability-
oriented macroeconomic policies and implement the necessary structural reforms to
sustain GDP growth.

In  2002,  the  budgetary  position  was  significantly  affected  by  the  revision  of
government  accounts  which  led  to  the  reclassification  of  a  number  of  operations
previously  excluded  from  the  budget.  As  a  result  of  these  revisions,  the  previously
estimated  general  government  surpluses  for  2000  and  2001  turned  into  deficits
reaching 1.1% of GDP in 2002 instead of the surplus of 0.8% of GDP projected in
the 2001 update. Similarly the government debt ratio is estimated at 105.3% of GDP
in  the  2002  update  compared  to  97.3%  of  GDP  in  the  previous  update.  The  2002
update  projects  the  government  balance  to  turn  into  a  surplus  of  0.6%  of  GDP  in
2006 and the government debt ratio to decline to 87.6% of GDP in the same year.

Further fiscal consolidation will be pursued on the basis of high and rising primary
surpluses.  However,  the  estimated  yearly  average  primary  surplus  of  4.8%  in  the
period  to  2006  is  lower  than  the  6%  of  GDP  projected  in  the  previous  update.
Moreover, the effectiveness of the budgetary strategy of increasing primary surpluses
is subject to significant uncertainties due to the lack of decisive measures aiming to
contain  current  expenditure.  In its opinion the  Council  considered  that  more  robust
medium-term  budgetary  adjustment  would  be  required  to  curb  decisively  the
government debt ratio, in particular taking into account the serious risks concerning
the  sustainability  of  public  finances  in  the  face  of  the  budgetary  costs  of  ageing
population.

1.1.2.

Spain

The main economic policy guidelines implemented in Spain in 2002 were described
in  the  2001-05  Stability  Programme  Update.  The  programme  reaffirmed  the
economic  strategy  followed  in  recent  years  based  on  fiscal  consolidation  and
structural reforms and was considered by the Council as being in accordance with the
Stability  and  Growth  Pact2.  Against  the  background  of  the  international  economic
downturn, GDP grew by 2.0% in 2002 compared to a growth assumption of 2.4% in
the update. Despite this, and after registering a deficit of 0.1% of GDP in 2001, the

2

OJ C 51, 26.2.2002, p.8.

9

                                                
target of a general government balanced budget was missed by only 0.1 p.p., while
the  debt-to-GDP  ratio  envisaged  in  the  update  was  exceeded  by  54%.  Price
developments,  however,  were  worse  than  expected,  with  consumer  inflation
averaging 3.6%, due both to temporary factors and a deterioration in core inflation.

The fourth Stability Programme Update, covering the period 2002-06, was submitted
to  the  Commission  on  27  December  2002  and  assessed  by  the  Council  on
18 February 20033. In its Opinion the Council considered the update complied with
the  Stability  and  Growth  Pact  and  was  consistent  with  the  broad  economic  policy
guidelines.  The  general  government balanced budget target for 2003 is extended to
2004 whereas small surpluses of 0.1% and 0.2% of GDP are envisaged for 2005 and
2006  respectively.  The  fiscal  strategy  outlined  in  the  update  remains  unchanged
compared  to  the  previous  programmes.  It  relies  on  primary  current  expenditure
restraint underpinned by decreasing interest payments, which allows for an increase
in  public  investment.  In  turn,  the  programme  includes  a  new  reform  of  personal
income  tax  to  take  effect  from  2003  consistent  with  the  maintenance  of  fiscal
consolidation. An additional reduction in the debt-to-GDP ratio is expected, reaching
53.1% in 2003 and falling below 47% by the end of the programme period.

1.1.3.

Ireland

last  years  of  Irish  stability  programmes  customarily 

The  Council's  assessment  of  the  Irish  stability  programme  2002-04  was  that  the
close-to-balance  objective  of  the  Stability  and  Growth  Pact  would  be  broadly
respected throughout  the  programme  period  if  the  so-called  contingency  provisions
(against  unforeseen  developments)  were  not  used4.  Budget  projections  for  the  first
and 
incorporate  such
contingency provisions and, in the 2002-04 update, they amounted to 0.8% and 1.1%
of GDP in 2003 and 2004 respectively. The 2002 outturn for the general government
balance  is  estimated  to  have  been  a  minor  deficit  of  just  0.1%  of  GDP,  about  ½
percentage point below target, for which a large tax undershoot is mainly to blame5.
Thanks  to  high  nominal  growth,  the  government  debt-to-GDP  ratio  fell  further,  to
about 34% in 2002.

The new update of the stability programme, for the period 2003-05, was published in
December 2002, together with the budget for 2003, which has a tightening bias. The
Irish  authorities  target  a  deficit  of  0.8%  of  GDP  for  20036,  which  they  project  to
widen  to  1.2%  in  both  2004  and  2005  (again  including  contingency  provisions,  of
0.4%  and  0.8%  of  GDP  respectively).  In  its  assessment  of  18  February  2003,  the
Council  noted  that  the  underlying  deficit  reaches  a  level  of  “close-to-balance  or  in
surplus” by 2005, in line with the Stability and Growth Pact. The Council added that,
should  Ireland  make  only  limited  use  of  the  contingency  provision,  the  close-to-
balance  requirement  would  be  reached  as  early  as  20047.  The  updated  stability
programme  envisages  a  small  rise  in  the  debt  ratio,  to  just  below  35%  by  2005,

3

4

5

6

7

OJ C 51, 5.3.2003, p.4.
OJ C 51, 26.2.2002.
For  this  assessment,  the  budget-day  target  (+0.7%  of  GDP)  has  been  adjusted  to  (i)  include  UMTS
receipts of 0.2% of GDP and (ii) exclude a transfer from the Central Bank of 0.5% of GDP which had
to be reclassified below the line.
Planned  outcome  taken  from  the  March  2003  reporting  of  government  deficits  and  debt  levels  in
accordance with Council Regulation (EC) No 3605/93, as amended by Regulation (EC) No 475/2000.
OJ C 51, 5.3.2003.

10

                                                
although without the build-up of assets in the National Pensions Reserve Fund8 the
debt ratio would continue to fall to 2005.

1.1.4.

Portugal

The  budgetary  situation  in  2002  did  not  develop  according  to  the  Stability
Programme  Update  (2002-05),  which  was  assessed  by  the  Council  on  12  February
20029. The general government deficit target was 1.8% of GDP, while according to
the  data  notified  in  March  2003,  the  deficit  outcome  in  2002  was  2.7%  of  GDP.
Implementation  of  the  stability  programme  in  2002  was  severely  hampered  by  the
significant  budgetary  slippage  in  2001,  which  led  the  Council  on  5  November  to
decide that an excessive deficit existed in Portugal. In fact, the extent of that slippage
had  considerable  knock-on  effects  in  2002,  as  it  was  fully  recognised  only  by  the
middle  of  that  year,  although  the  Portuguese  authorities  had  adopted  corrective
measures  in  June  2002.  In  addition,  economic  growth  in  2002  turned  out  to  be
weaker than initially anticipated.

The fourth Stability  Programme  Update,  covering the period 2003-06, was adopted
by the government on 20 December and assessed by the Council on 7 March 2003.
Given the magnitude of the budgetary slippage registered in 2001, the deficit targets
set  in  the  previous  programme  updates  had  become  obsolete.  The  new  programme
update projects a gradual reduction in the deficit-to-GDP ratio over the period 2003-
06, reaching a position close to balance by the end of the period (2.4% in 2003, 1.9%
in 2004, 1.1% in 2005 and 0.5% in 2006). In particular, the budgetary target for 2003
implies a considerable fiscal consolidation effort, which to a large extent is caused by
the  need  to  make  up  for  the  considerable  amount  of  one-off  measures  adopted  in
2002  with  a  view  to  an  early  correction  of  the  excessive  deficit.  Moreover,  the
weakening  of  cyclical  conditions  may  prevent  implementation  of  the  budget  as
planned, possibly requiring the introduction of additional saving measures.

1.2.

Conditionality

In  2002  the  Member  States  benefiting  from  the  Cohesion  Fund  implemented  their
stability programmes in such a way as to avoid an excessive deficit.

In  Portugal,  the  national  authorities  announced  on  25  July  2002  that  the  general
government  deficit  in  2001  amounted  to  4.1%  of  GDP,  clearly  exceeding  the
reference value of 3% of GDP. This figure was confirmed in Portugal’s submission
by  1  September  2002  under  the  semi-annual  reporting  of  government  deficits  and
debts levels. Based on this evidence, the Commission initiated the excessive deficit
procedure  under  Article  104  of  the  Treaty  and  on  16  October  2002  adopted  an
opinion on the existence  of  an excessive  deficit  in  2001  and  two  recommendations
for  Council  decisions.  Given  that  the  Portuguese  authorities  had  already  taken
prompt  measures,  through  an  amending  budget  that  implemented  in  June  2002
measures  on  both  the  revenue  and  expenditure  sides,  the  Commission  did  not
recommend the suspension of the Cohesion Fund in Portugal. On 5 November 2002,
the  Council  decided  that  an  excessive  deficit  had  existed  in  2001  and  issued  a

8

9

The Fund receives 1% of GNP annually from general government resources. At the end of 2002, it was
worth over 7% of GNP.
OJ C 51, 26.2.2002, p.8.

11

                                                
recommendation  urging  the  Portuguese  authorities  to  bring  it  to  an  end  by
31 December 2002.

This  was  done.  According  to  the  data  notified  in  March  2003,  the  general
government deficit in 2002 amounted to 2.7% of GDP.

2.

IMPLEMENTING PRINCIPLES AND ASSISTANCE GRANTED

2.1.

Coordination with other Community policies

2.1.1.

Public procurement

The Commission pays particular attention to ensuring that Community legislation on
public  procurement  is  rigorously  applied  to  projects  part-financed  by  the  Cohesion
Fund.

When  an  application  is  submitted,  the  form  used  to  request  assistance  requires
applicants  to  send  copies  of  published  calls  for  tenders  and  other  information
confirming correct observance of the  procedure for  awarding  contracts.  If  contracts
have  not  yet  been  awarded  when  an  application  is  made,  the  beneficiary  Member
State is required to provide information on compliance with the rules on the award of
public contracts when interim payments are made or the final report presented.

In its inspection missions, the Commission undertakes routine checks on compliance
with the relevant Community directives on public procurement and the correctness of
the tender selection procedures.

The  Commission  cautioned  Portugal  for  its  failure  to  comply  with  the  “public
procurement” directives when awarding services concessions to firms controlled by
the public company Águas de Portugal without a tendering procedure.

2.1.2. Competition

Assistance  from  the  Cohesion  Fund  is  directed  primarily  to  projects  relating  to
transport infrastructure or the protection of the environment (treatment of water and
waste management).  These  do  not  generally  raise  problems  of  incompatibility  with
the  Community  rules  on  competition.  Unless  they  infringe  the  rules  on  public
procurement,  and  provided  free  access  to  such  infrastructure  is  guaranteed  for  all
operators meeting the necessary technical and legal conditions, such assistance does
not provide specific firms with any special advantage.

Since, however, it cannot automatically be  assumed that certain assistance may not
include State aid, Community inspections continued throughout 2002 in the form of a
prior examination of applications for finance  concentrating on  an assessment of the
compatibility of measures part-financed by the Fund with Articles 87 and 88 of the
Treaty.

12

2.1.3. Environment

The  Cohesion  Fund  contributes  to  the  more  general  objectives  of  environmental
policy  in  relation  to  sustainable  development  and  in  particular  achievement  of  the
priority  of  the  6th  Action  Programme  concerning  the  management  of  natural
resources and waste.

In  2002,  the  Cohesion  Fund  continued  its  efforts  to  implement  environmental
legislation both through the direct financing of infrastructure to treat waste water and
waste and provide drinking water and by ensuring the correct application of certain
directives as a prior condition for  granting finance. This concerns both the subject-
based  directives  with  a  large  spatial  component  (e.g.  those  on  nature  conservation
and the management of waste and waste  water) and  the directive on  environmental
impact assessments (EIA).

Drawing  up  the  lists  of  Community  sites  for  the  Natura  2000  network  remains  a
priority for the Commission. In 2002, bio-geographical seminars were organised for
the Continental and Atlantic regions. The draft list of sites for the Alpine region was
also finalised.

The initiative taken by the Commission to link the granting of Community finance to
submission of the  lists  of  Natura 2000  sites,  which  should  have  been  sent  in  1995,
has considerably speeded up the process.

Where  appropriate,  the  Commission  has  assessed  whether  applications  for  part-
finance  under  the  Cohesion  Fund  are  compatible  with  Article  6  of  Directive
92/43/EC (the “Habitats” Directive). The Commission has assessed applications for
finance  for  the  treatment  of  urban  waste  in  the  light  of  the  policy  and  legislation
applicable in this sector.

Projects  for  the  treatment  of  urban  waste  water10  can  be  financed  only  at  the
appropriate level depending on the designation of the zones (primary in the case of
less sensitive zones, secondary in the case of normal zones and tertiary in the case of
sensitive zones), as provided for by Directive 91/271/EEC.

When assessing applications for part-finance, the Commission has also had regard to
the inclusion of projects in integrated operational systems and their incorporation in
plans for the water basin.

The  projects  financed  by  the  Cohesion  Fund  have  permitted  application  of  the
polluter pays principle by using different levels of aid11. Application of the polluter-
pays  principle  will  soon  be  strengthened  by  application  of  the  framework  directive
on water12.

The  authorities  of  the  Member  States  responsible  for  the  environment  are  also
involved  in  examining  projects  through  requests  for  opinions.  All  projects  are
monitored through their participation in the Monitoring Committees.

10

11

12

Directive 91/271/EEC.
Working document No 1, application by DG REGIO of the polluter-pays principle.
Directive 2000/60/EC.

13

                                                
2.1.4. Transport

While  TENs  transport  projects  of  common  interest  are  financed  from  the  trans-
European  transport  networks  budget  line,  the  Cohesion  Fund  provides  funds
specifically for TENs transport infrastructure.

Co-ordination between the TENs budget and the Cohesion Fund is important because
these Community financial instruments take into account the need for links between
the central regions of the Community regions and those structurally handicapped by
their insular, landlocked or peripheral status.

The  TENs  Regulation  does  not  allow  the  same  phase  of  a  single  project  to  be
financed both by the TENs budget and from other Community sources but, in some
cases,  feasibility  studies  financed  through  the  TENs  budget  may  be  followed  by
support  from  the  Cohesion  Fund  and/or  the  EIB  for  the  construction  works  of  the
actual investment.

The  TENs  Financial  Regulation  ((EC)  No  2236/95)  was  amended  by  Regulation
(EC) No 1655/1999 to provide for medium-term planning via indicative multi-annual
programmes  for  Community  funding  (MIP)  and  for  the  encouragement  of  public-
private partnerships, together with the use of a small amount of the budget line (1%-
2%) to support projects involving risk capital.

The MIP proposal 2001-06, that was adopted by the Commission in September 2001,
provides a total of about €2.8 billion for 11 priority projects (“Essen” projects), the
project Global Navigation Satellite Systems (“Galileo”) and four groups of projects
of “common interest”.

In  2002  a  total  of  €563.4 million  in  commitment  appropriations  was  allocated  to
TENs transport projects under the MIP, the Galileo project and projects of common
interest  outside  the  MIP.  In  addition  €7 million was  transferred  to  the  Risk  Capital
Facility to contribute to finance TENs Transport projects using a PPP approach.

As  regards  the  distribution  of  support  in  2002  by  mode,  by  far  the  greatest  part  of
Union  spending  on  transport  under  the  TENs-T  budget  was  concentrated  on  rail
projects (almost 47%), followed by Galileo (30%) and roads (4%).

2.2.

Coordination  with  the  Structural  Funds:  the  strategic  reference  frameworks
(CRS)

2.2.1. Environment

Greece

The Strategic Reference Framework (SRF) for the environment sector is described in
a separate Chapter of the operational  programme  for  the  environment  of  the  Greek
CSF  2000-06.  This  Operational  Programme  was  approved  by  the  Commission  on
24 July  2001  (Decision  E(2001)  1357).  The  SRF  is  a  tool  in  an  overall  assistance
package  whose  aim  is  to  enable  Greece  to  comply  more  fully  with  its  obligations
under EU environmental legislation and to contribute to sustainable development.

14

This financial contribution of the Cohesion Fund to this environmental plan seeks to
meet  some  of  Greece’s  major  infrastructure  needs  in  the  fields  of  drinking  water,
urban waste water and solid waste management and is expected to make a substantial
contribution to this aim.

As  regards  solid  waste  management,  the  overall  plan  of  action  is  based  on  the
National Solid Waste Management Plan, which has been prepared by the Ministry of
the Environment, Planning and Public Works and submitted to the European Union.

Using management plans agreed at national, regional and local level, the general goal
is the correct management of all categories of solid waste and where appropriate the
restoration of the environment where it has been degraded and polluted by waste.

Similar  plans  have  also  been  made  for  the  urban  waste-water  management  sector
throughout  the  country  in  accordance  with  Directive  91/271/EEC.  The  Cohesion
Fund and the ERDF will assist the Greek authorities to comply with this Directive.

In 2002, investments were made in the sectors of solid waste, waste-water treatment
and  water  supply  to  implement  the  strategic  reference  framework  (SRF)  for
environmental  projects,  Most  of  the  projects  approved  concern  urban  solid  waste
projects,  followed  by  water  supply  and  WWTPs.  In  cooperation  with  the  national
authorities, future efforts will concentrate on making and completing investments in
the  fields  of  solid  waste  and  waste  water  so  as  to  meet  the  requirements  of
Community legislation.

Spain

The priority sectors for assistance to be financed through the Cohesion Fund for the
2000-06 programming period are:

–  water supply

–  sewerage and waste-water treatment

–  management of municipal, industrial and hazardous waste.

Items of  assistance  are  selected  using  a  co-ordinated strategic approach  devised for
each of these sectors and forming part of programmes identifying the main priorities
for assistance in the different sectors; they must also be coordinated with assistance
in  the  same  sectors  financed  by  the  Structural  Funds.  The  contents  of  each  of  the
sectoral  strategic  frameworks  were  described  in  the  2000  Annual  Report  of  the
Cohesion Fund.

Ireland

The  Irish  authorities  presented  their  strategic  reference  framework  for  the
environment  sector  in  2000  and  it  continues  to  form  the  basis  for  considering
assistance  to  individual  projects  in  the  waste  water  and  solid  waste  sub-sectors.
Coherence between Structural Fund programmes and the Cohesion Fund priorities is
relatively easily to ensure because of the concentration of Cohesion Fund assistance
on  a  small  number  of  major  construction  projects.  During  2002,  no  new
environmental project was approved for part-financing.

15

Portugal

The  environment  strategic  framework  for  Portugal  for  2000-06  includes  the
following priorities:

–  further development and completion of the basic environment infrastructure,

–  providing  the  conditions  needed  for  sustainable  development,  environmental

protection and the management of natural resources.

Cohesion  Fund  assistance  has  been  provided  for  large  water  supply,  urban  waste-
water drainage and treatment, and urban solid waste treatment infrastructure projects.
Smaller  supplementary  projects  have  also  been  financed  by  the  ERDF  under  the
regional programmes of the Portuguese Support Framework.

For  water  supply  and  urban  waste-water  drainage  and  treatment  an  integrated
systems  approach,  with  a  single  entity  managing  the  whole  intermunicipal  system
covering  the  complete  ‘water  cycle’  is  now  the  norm.  This  has  the  advantage  of
optimising  the  planning  and  investment  phase  of  the  projects  and  ensuring  that  the
integrated  system  is  then  operated  and  maintained  by  a  highly  professional  and
specialised company.

This managing entity is either a public sector company, in which the municipalities
hold a substantial stake, or an intermunicipal association, which has a specific status
under law. In either case, the transfer and sharing of management responsibilities for
these  integrated  systems  requires  complex  negotiations  and  the  drafting  of  service
agreements between the parties.

Approval  of  some  new  projects  has  been  considerably  delayed  by  an  infringement
procedure against Portugal regarding the award of service concessions to these public
sector  companies.  Such  delays  will  have  an  impact  on  the  implementation  of  the
Environment  Strategic  Framework,  although  it  is  hoped  that  they  will  be
substantially retrieved during 2003.

2.2.2. Transport

Greece

The  strategic  reference  framework  (SRF)  for  the  transport  sector  in  Greece  was
approved under the operational programmes “Roads, ports and urban development”
and “Railways, airports and urban transport” in March and April 2001 respectively.
The  SRF  provides  for  assistance  together  with  part-financing  by  the  ERDF  aimed
mainly at:

completing  the  TENs  priority  road  axes  in  Greece  (the  Pathe,  Egnatia  and

a)
Ionian highways and the Corinth–Tripoli–Kalamata/Sparta motorway),

completing  and  modernising  the  PATHEP  rail  route,  including  electrification

b)
and signalling,

c)

d)

modernising infrastructure in the ports of Igoumenitsa and Heraklion, and

modernising the air traffic control system in Greece.

16

The  priorities  for  the  transport  sector  for  the  current  period  under  the  agreed
strategy are  motorways,  railways  and  ports.  Their  main  aim  is  to  implement  the
trans-European networks by constructing the Pathe and Egnatia priority key routes.

As  regards  railways,  further  planning  efforts  are  needed  to  properly  and  fully
implement the modernisation of the PATHEP railway route.

Spain

As  part  of  discussions  between  the  Commission  and  Spain,  the  Spanish  authorities
submitted  a  document  on  investment  in  the  trans-European  transport  networks
(TENs)  setting  out  the  general  strategy  in  this  area  in  the  2000-06  programming
period. As a complement to this document, the Spanish authorities defined a strategy
for using the Structural Funds and the Cohesion Fund to improve the coherence and
complementarity of these two instruments.

This  strategy  of  using  the  Funds  to  finance  investments  in  the  trans-European
transport networks is relatively clear and simple and may be summarised as follows:

The  high-speed  rail  lines  in  the  strategic  framework  (Madrid—Barcelona—French
border, Madrid—Valladolid, Madrid—Valencia and Córdoba—Málaga) are the main
routes  which  will  help  improve  intermodal  balance  and  secure  more  rational  and
environmentally-friendly  distribution.  These  projects  are  the  major  priority  for  the
period 2000-06 and this, together with the fact that, apart from the Córdoba—Málaga
line,  they  are  interregional,  means  that  the  Cohesion  Fund  is  the  main  source  of
finance for three of the four.

Ireland

The  Irish authorities presented their strategic  reference  framework  for  the  transport
sector in 2000. This reference framework continues to form the basis for considering
assistance to individual projects in the road and rail sub-sectors. Coherence between
the  relevant  Structural  Funds  programmes  and  the  Cohesion  Fund  priorities  is
relatively easily ensured in view of the concentration of Cohesion Fund assistance on
a  small  number  of  major  construction  projects.  During  2002,  no  new  transport
project was adopted for part-financing.

Portugal

During 2002 only one new project was adopted in the field of transport. It concerns
access to the trans-European network.

During this year the work of the Cohesion Fund concentrated heavily on monitoring
the  implementation  of  projects  approved  in  earlier  years.  In  this  regard  particular
attention  continued  to  be  paid  to  overall  coordination,  especially  as  regards
investments part-financed by other Community sources, in order to secure maximum
synergy in completing operational transport systems by 2006.

The main strategic guidelines of the framework remained unaltered.

17

2.3.

Implementation of the budget, commitments and payments

2.3.1. Budget available

In  accordance  with  Article 4  of  Regulation  (EC)  No 1164/94,  as  amended  by
Regulation  (EC)  No 1264/1999  (the  Cohesion  Fund  Regulation),  Cohesion  Fund
resources  available  for  commitment  for  2002  amounted  to  €2 615  million  at  1999
prices. The final amount entered in the budget after indexation was €2 788 million,
including about €1 million for technical assistance.

In accordance with the brackets for the allocation of resources by Member State laid
down in Annex I to the Cohesion Fund Regulation, the indicative allocation of these
appropriations by country for 2002 (in 1999 prices) is as follows:

Country

Spain
Greece
Ireland
Portugal
Appropriations available

Allocation
%
61.03
16.83
5.32
16.83
100

Allocation
€ million

1.596
440
139
440
2.615

2.3.2. Budget implementation

Budget implementation in 2002, with indexation of the appropriations carried over,
was as follows:

Summary table of the implementation of appropriations in 2002 (in €)

Commitment
appropriations
Budget 2002
Appropriations  carried
over from 2001
Appropriations  made
available again
Repayments
Totals

Initial

Movements

2 789 000 000
3 314 496

0

0
2 792 314 496

0
0

0

0
0

Final
resources
2 789 000 000
3 314 496

Implementation

Cancelled

Carryovers
to 2002

2 788 154 716
3 314 496

845 284
0

0

0

0

0
2 792 314 496

0
2 791 469 212

0
845 284

0
0

0

0
0

Under  Article 7  of  the  Financial  Regulation,  appropriations  not  implemented  at  the
end  of  the  year  are  cancelled,  unless  the  Commission  takes  a  specific  decision  to
carry  them  over.  The  commitment  appropriations  were  implemented  at  the  rate  of
99.9% and only €845 000 was cancelled at the end of the year.

In  addition  only  €3.3  million  in  commitment  appropriations  was  carried  over  from
2001.  No  commitment  or  payment  appropriations  were  carried  over  from  2002  to
2003.

Initial

Movements

2 600 000 000
0

548 000 000
0

Final
resources
3 148 000 000
0

3 148 000 000
0

Implementation

Cancelled

Carryovers
to 2002

Payment
appropriations
Budget 2002
Appropriations  carried
over from 2001
Appropriations  made
available again
Repayments
Totals

0
0

0

0
0

0
0

0

0
0

0

0

0

0

0
2 600 000 000

0
548 000 000

0
3 148 000 000

0
3 148 000 000

18

Payment  appropriations  amounting 
transferred  from
Objective 2 to the Cohesion Fund to meet applications for payment from the Member
States. All the payment appropriations, including this transfer, were implemented.

to  €548  million  were 

Implementation  of  the  appropriations  for  each  country  is  show  in  the  following
tables:

Budget implementation of appropriations in 2002 by Member State

Commitment appropriations 2002

Member State

Environment

Spain
Greece
Ireland
Portugal
Technical assistance
Total

Amount
930 467 527
220 580 268
75 378 358
60 318 853
-
1 286 745 006

% Envir.
47.1
65.8
41.3
20.3
-
46.1

Amount
1 046 236 673
114 577 670
107 282 982
236 461 881
-
1 504 559 206

Transport

Mixed
% Transport Amount

52.9
34.2
58.7
79.7
-
53.9

165 000
165 000

Payment appropriations 2002

Transport

Mixed
% Transport Amount

Member State

Environment

Spain
Greece
Ireland
Portugal
Technical assistance
Total

Amount
924 763 990
125 620 657
98 040 769
187 660 533
-
1 336 085 950

% Envir
44.6
26.3
51.0
46.1
-
42.4

Amount
1 146 960 474
351 182 669
94 157 866
219 461 276
-
1 811 762 284

55.4
73.7
49.0
53.9
-
57.6

151 764
151 764

Total

Amount
1 976 704 200
335 157 938
182 661 340
296 780 734
165 000
2 791 469 212

Total

Amount
2 071 724 465
476 803 326
192 198 635
407 121 809
151 764
3 148 000 000

%
70.8
12.0
6.5
10.6
0
100

%
65.8
15.1
6.1
12.9
0
100

As in 2000, Spain and Ireland committed appropriations in excess of their allocation
in 2002, so offsetting below-allocation consumption by Portugal and Greece.

the 

in  2001 

While 
implementation  of  appropriations  had  concentrated  on
environmental projects (51.5% of commitment appropriations and 61.3% of payment
appropriations), in 2002 transport projects dominated (53.9% and 57.6% respectively
of total appropriations).

The  following  table  shows  total  implementation  in  2000-02  in  each  country
(excluding technical assistance):

Member State
Spain
Greece
Ireland
Portugal
EUR 4

Allocation 2000-03
61.02 %
16.81 %
5.30 %
16.87 %
100.00 %

2000
1 601 305 968
435 532 521
169 624 664
450 770 587
2 657 233 740

2001
1 676 893 850
467 400 382
115 000 000
455 699 130
2 714 993 362

2002
1 973 389 704
335 157 938
182 661 340
296 780 734
2 787 989 716

Total
5 251 589 522
1 238 090 841
467 286 004
1 203 250 451
8 160 216 818

19

2.3.3.

Implementation of the budget for the previous period (1993-99)

Changes in 2002 in appropriations to be settled for 1993-99 were as follows:

Settlement in 2002 of commitments for the period 1993-99

Member State

Spain
Greece
Ireland
Portugal
Technical assistance
Total

Initial amount to be
settled
1 431 403 614
580 201 417
152 406 440
155 331 457
310 161
2 319 653 089

Decommitments

Payments

36 410 115
831 909
54 101
2 176 027
213 707
39 685 859

479 907 815
197 383 280
61 859 930
50 026 932
0
789 177 957

Final amount to be
settled

915 085 684
381 986 228
90 492 409
103 128 498
96 454
1 490 789 273

Cohesion Fund commitments are made from differentiated appropriations.  If all the
projects  are  implemented  in  line  with  the  decisions,  an  amount  to  be  settled  exists
‘automatically’ because of the gap between the date of the decision and the date of
payment of the balance (normally 4 to 5 years).

The  major  effort  to  clear  the  appropriations  to  be  settled  begun  in  2000  was
vigorously  pursued  in  2002  with  some  36%  of  the  appropriations  remaining  to  be
settled at the  beginning of the  year being  paid  or  decommitted  during  the  year.  By
the end of 2002, these appropriations represented only just over half the budget of the
Cohesion Fund for one  year. Naturally, this effort to liquidate the appropriations to
be settled will continue in 2003.

3.

THE PROJECTS AND MEASURES ADOPTED

3.1.

Assistance from the Fund by Member State

3.1.1. Greece

During  2002  the  Commission  approved  Cohesion  Fund  assistance  totalling
€238.7 million, of which €129.6 million was committed in that year’s budget.

Including  commitments  made  as  a  result  of  decisions  taken  in  previous  years
(€199 million) brought the total amount committed during 2002 to €335 million.

The following table shows the Cohesion  Fund  assistance  approved  in 2002  and the
total amount committed in that year.

Total eligible
cost
(€ million)

Total CF
assistance
(€ million)

Commitments
2002*
(€ million)

Environment

309 429 632

232 072 223

220 580 268

Transport

Total CF

% Environment

% Transport

8 524 400

6 648 211

114 577 670

317 954 032

238 720 434

335 157 938

97%

3%

97%

3%

66%

34%

* Including commitments based on the decisions taken in 2002 and in previous years

20

3.1.1.1 Environment

In  2002,  the  Cohesion  Fund  concentrated  its  financial  support  on  the  solid  waste,
water supply and waste-water treatment sectors. The aim was to complete the cycle
of assistance, filling the gaps in the existing systems so as to implement the agreed
strategic reference framework.

During  2002,  the  Commission  approved  Cohesion  Fund  assistance  totalling
€232 million for thirteen projects, of which €129.6 million was committed from that
year’s budget. The assistance approved and appropriations committed break down as
follows:

DECISION No

CF Code

Project Name

C(2002)4708

2002-GR-

CCI: 
16-C-PE-007

Projects  of 
solid  waste
management  in  Chalkidiki,
Pella  and  Kilkis,  Region  of
Central Macedonia

Total decision
cost

CF assistance Commitment

23 055 776

17 291 832

13 833 465

C(2002)4676

2001-GR-

CCI: 
16-C-PE-012

water 

Sewage, 
extension  of  WWTP 
Lamia, 
Region 
Continental Greece

supply,
in
of

C(2002)4704

2002-GR-

CCI: 
16-C-PE-003

Construction  of  landfills  in
Trikala  and  Larissa,  Region
of Thessalia

C(2002)4702

CCI: 2002 GR 16
C PE 001

Solid  waste  management  in
the  island  of  Samos,  Region
of North Aegean

C(2002)1769

2001-GR-

CCI: 
16-C-PE-019

Water  supply  and  sewage  in
Community,  Region  of  East
Macedonia and Thrace

C(2002)4710

CCI: 2002 GR 16
C PE 006

C(2002)4636

CCI: 2001 GR 16
C PE 028

C(2002)4709

CCI: 2002 GR 16
C PE 004

Construction  of  landfill  &
access  roads  in  the  North
West  part  of  Thessaloniki,
Region 
Central
of 
Macedonia

extension 

supply
Sewage  &  water 
extension, 
and
modernisation  of  WWTP  in
Katerini,  Region  of  Central
Macedonia

Landfill 
rehabilitation  &
drainage  processing  unit  in
Tagarades, 
of
Central Macedonia

Region 

12 000 000

9 000 000

7 200 000

9 284 247

6 963 185

5 570 548

10 444 000

7 833 000

6 266 400

16 176 000

12 132 000

9 705 600

33 992 210

25 494 157

20 395 326

20 000 000

15 000 000

12 000 000

13 833 071

10 374 803

8 299 842

C(2002)4698

CCI: 2001 GR 16
C PE 010

Water  supply,  sewage  &
WWTP  in  Malia,  Region  of
Crete

16 249 704

12 187 278

9 749 822

21

C(2002)4696

CCI: 2000 GR 16
C PE 006

Construction  of  Aposelemi
in  Agios  Nikolaos,
dam 
Heraklion, Region of Crete

124 879 970

93 659 978

18 844 496

C(2002)4703

CCI: 2002 GR 16
C PE 002

C(2002)4706

CCI: 2002 GR 16
C PE 009

C(2002)4705

CCI: 2002 GR 16
C PE 010

Construction  of  landfills  in
the  Northern  Department  of
Evia  &  Fokida,  Region  of
Continental Greece

solid  waste
Projects  of 
Achaia
management 
– 
landfill,  Aigialia 
landfill,
transportation
landfill  and 
area  of
the 
system 
Nafpaktos,  rehabilitation  of
Epitalion  landfill,  Region  of
West Greece

in 

Construction  of  landfills  and
rehabilitation  of  old  landfill
site  (landfill  in  North  Corfu,
in
landfill 
landfill
Keffalonia, 
restitution  in  Corfu),  Region
of Ionian Islands

extension 

6 731 623

5 048 717

4 038 974

12 830 000

9 622 500

7 698 000

9 953 031

7 464 773

5 971 818

TOTAL

309 429 632

232 072 223

129 574 291

In  addition,  on  the  basis  of  decisions  taken  in  the  previous  year,  an  amount  of
€84,4 million was been committed from that year’s budget.

Finally, the Commission issued three corrigenda as a  result of slight  errors  with no
financial impact.

3.1.1.2 Transport

Rail

In  2002  the  Commission  approved  no  decisions  granting  assistance  to  the  railway
sector.

One request for an amended decision concerning the Thessaloniki–Alexandroupolis
project was approved by the Commission in August 2002. The amendment relates to
the deadline for the completion of the project without any budgetary increase.

A project proposal concerning  the third phase  of the construction of the Thriassio–
Elefsina–Corinth  section  was  received  in  November  2001.  It  did  not  result  in  a
decision as the Commission considered it needed substantial additional information.

As a result of decisions taken in the previous years, an amount of €44 498 531 was
committed from the 2002 budget.

22

Roads

No new grant decisions concerning road projects were approved in 2002.

A request for an amended decision concerning the “Port of Igoumenitsa – Phase A”
project was approved in 2002. It increased the total eligible cost from €41.7 million
to  €50.2  million  and  the  Cohesion  Fund  contribution  from  €35.4  million  to
€42 million. Based on this decision, an amount of €6.6 million was committed in the
2002 budget.

DECISION No

CF Code

Project name

Total decision
cost increase

CF assistance
increase

Commitment

C(2002)4628 CF: 930965004 Port of Igoumenitsa: Phase A

8.524.400

6.648.211

6.648.211

As  a  result  of  decisions  taken  in  previous  years,  an  amount  of  €63  430  928  was
committed from the 2002 budget.

3.1.2.

Spain (including the outermost regions)

The  Commission  adopted  88  new  decisions  granting  assistance  from  the  Cohesion
Fund  totalling  €2  654  million,  of  which  €1  973  million  was  committed  in  2002.
These  commitments  exceeded  by  €271  million  Spain’s  allocation  for  that  year  in
order  to  avoid  the  loss  of  available  budget  resources  not  used  by  other  Member
States.

These  commitments,  of  which  47%  is  for  the  environment  and  53%  for  transport
infrastructure,  reflect  new  decisions  adopted  that  year  and  amendments  and  annual
instalments of decisions adopted previously. A total of 53 amending decisions were
approved.

The following table shows the amount for each sector:

Total eligible cost*
(€ million)

Total assistance*
(€ million)

Commitments 2002*
(€ million)

Environment

Transport

Total CF

% Environment

% Transport

* rounded figures

1 495

1 807

3 302

45.3 %

54.7 %

1 210

1 444

2 654

45.6 %

54.4 %

 927

1046

1 973

47 %

53 %

During  2002,  payment  appropriations  totalling  €2  072  million  were  authorised  and
61 applications were closed with the balance paid.

23

3.1.2.1 Environment

The  Cohesion  Fund  continued  to  concentrate  its  financial  support  on  the  three
priority  sectors,  water  supply,  drainage  and  waste-water  treatment,  and  the
management of solid urban, industrial and hazardous waste. The preparatory studies
required  for  projects  in  the  water  sector  were  financed.  The  main  aim  of  these
projects is to help the municipalities and regions to improve drinking water supplies
and waste-water networks and the collection and treatment of waste.

The  contribution  of  the  Cohesion  Fund  by  sectors  shows  that  the  drainage  and
treatment of waste water, followed by solid waste, continued to receive the bulk of
resources for the environment:

Sector

Total
eligible cost
(€ million)

Total
assistance
(€ million)

% of
assistance

Commitments 2002
(€ million)

Water supply

Drainage 
treatment

and  waste-water

Management of solid waste

Technical assistance

174.18

822.34

488.52

10.35

139.32

11.51%

670.99

55.46%

390.82

32.30%

8.80

 0.73%

TOTAL

1 495.39

1209.93

100.00

Water supply

118.00

473.45

328.65

7.04

927.14

During 2002,  Community  assistance  for  measures  to improve  water supply  totalled
€139 million, 11.5% of the amount allocated to the environment sector.

The  projects  financed  in  this  sector  are  intended  primarily  to  ensure  adequate
supplies  of  drinking  water  of  sufficient  quality  to  consumers  in  conformity  with
Community directives.

Water supply

Projects adopted in 2002

No of project

Name of project

Total cost
(€)

CF
assistance
(€)

2000 ES 16 C PE 045 Water supply in the southern basin – 2001

15 433 363

12 346 690

2000 ES 16 C PE 128 Water supply in the Júcar basin - 2001

14 011 098

11 208 87

2001 ES 16 C PE 003 Water supply in the Guadalquivir Basin

5 525 579

4 420 463

2001 ES 16 C PE 021 Water supply measures in the Ebro Basin – 2001 - Group

16 538 331

13 230 665

2

2001 ES 16 C PE 041 Regulatory storage and linked pipes for supply networks

5 634 489

4 507 591

– Ibiza

24

2002 ES 16 C PE 003 Expansion  of  the  water  supply  to  Navas  del  Marqués

19 454 762

16 536 548

(Avila)

2002 ES 16 C PE 031 Water supply measures in the Ebro basin – 2002

17 272 286

13 817 829

2002 ES 16 C PE 057 Water  supply 

to  multi-municipal  systems 

in 

the

10 706 529

8 565 223

provinces of Cádiz and Jaén

2002 ES 16 C PE 061 Water  supply 

to  multi-municipal  systems 

in 

the

27 409 299

21 927 439

provinces of Granada and Málaga

Waste-water treatment

This  sector  absorbed  €671  million  in  2002,  55%  of  the  amount  allocated  to  the
environment by the Cohesion Fund and the largest portion of the resources available
for  this  sector.  Once  again,  efforts  concentrated  on  compliance  with  Directive
91/271/EEC and setting up the national drainage and water treatment plan.

28 decisions were adopted for projects and  groups of projects  in  urban  areas  in  the
main  water  basins  and  five  to  amend  projects  already  adopted.  These  projects
concern  improvements  to  treatment  networks,  collectors  and  the  adaptation  of
existing treatment stations to meet higher standards,  as in the case of  the  project to
extend  the  station  at  Besós  (Catalonia).  This  project  concerns  the  extension  of
biological treatment to waste water to comply with the environmental directives and
allow the treatment of some 525 000 m3/day of waste water.

Waste-water treatment

Projects adopted in 2002

Total cost

CF assistance
(€)

No of project

Name of project

(€)

2000 ES 16 C PE 058

Drainage and supply in the Segura basin – 2001

36 386 314

29 109 050

2000 ES 16 C PE 120

Drainage  and  treatment  projects  in  the  Tagus  basin  –
2001 – Group 1

15 801 166

12 640 933

2001 ES 16 C PE 006

Drainage measures in the Ebro basin – 2001 – Group 1

15 201 000

12 160 800

2001 ES 16 C PE 019

Drainage in the southern basin – 2001 – Group I

12 362 306

9 889 845

2001 ES 16 C PE 017

Drainage  and  treatment  projects  in  the  Guadalquivir
Basin – 2001 – Group 3

18 189 027

14 551 222

2001 ES 16 C PE 033

Drainage and treatment projects in the southern basin –
2001 – Group 2

20 452 245

16 361 796

2001 ES 16 C PE 035

Drainage in the Tagus basin – 2001 – Group II

59 005 518

47 204 415

2001 ES 16 C PE 037

Drainage in the Júcar basin – 2001 – Group 3

16 512 102

13 209 681

2001 ES 16 C PE 038

Drainage and treatment in the Liébana valley

9 766 000

7 812 800

25

2001 ES 16 C PE 050

Drainage in the Júcar basin – 2001 – Group 2

14 083 376

11 266 701

2001 ES 16 C PE 052

Drainage projects in the Balearic Islands basin – 2001 –
Group 2

5 673 042

4 538 834

2001 ES 16 C PE 054

Treatment of sludge and reuse of urban waste water in
Catalonia

78 447 105

62 757 684

2001 ES 16 C PE 058

Extension of biological treatment at the Besós station

136 730 254

116 220 716

2002 ES 16 C PE 002

Discharge: middle basin, Getafe and lower basin of the
Culebro

43 970 160

37 374 636

2002 ES 16 C PE 019

Drainage and water treatment in Gipuzcoa – 2002

26 335 032

21 068 026

2002 ES 16 C PE 021

Drainage  and  full  treatment  for  various  areas  in  the
upper Guadiana basin

10 858 000

8 686 400

2002 ES 16 C PE 022

Drainage and full treatment in the lower Sierra de Gata
basin of the Tagus

12 530 000

10 024 000

2002 ES 16 C PE 030

Drainage and water treatment on the Balearic Islands –
2002

11 445 835

9 156 668

2002 ES 16 C PE 032

Drainage on the Segura in Murcia

12 000 000

9 600 000

2002 ES 16 C PE 033

Drainage works in the Ebro basin – 2002

20 699 238

16 559 390

2002 ES 16 C PE 036

Drainage and treatment in the lower middle basin of the
Miera: Cudeyo

11 714 650

9 371 720

2002 ES 16 C PE 037

Drainage and water treatment in Vizcaya – 2002

30 881 605

24 705 284

2002 ES 16 C PE 044

Drainage  and  waste-water 
natural areas of -Andalucía – Phase II

treatment 

in  protected

20 356 997

16 285 598

2002 ES 16 C PE 045

Drainage  and  treatment  in  the  middle  Guadalquivir
basin (Province of Córdoba)

15 503 110

12 402 488

2002 ES 16 C PE 046

Drainage  and  treatment  in  the  Guadalquivir  basin
(Province of Seville)

20 431 478

16 345 182

2002 ES 16 C PE 051

Drainage in the north basin – Asturias – 2002

23 938 274

19 150 619

2002 ES 16 C PE 054

Drainage in the Guadalquivir basin – 2002 – Group I

14 786 461

11 829 169

2002 ES 16 C PE 058

Extension  and  improvement  of  drainage  in  the  Júcar
Basin 2002 – Group III

26 736 326

21 389 061

Solid waste

In  order  to  implement  the  National  Plan  for  solid  waste  approved  in  2000  and  the
regional  Plans  approved  for  each  Autonomous  Community,  the  Spanish  authorities
submitted a large number of projects in this sector.

26

In 2002, 23 decisions were adopted on waste management and two to amend projects
adopted  earlier.  Most  concerned  projects  from  municipalities,  either  individual  or
grouped by Autonomous Community. Assistance totalling €391 million was granted,
32% of the total for the environment.

Priority was given to solid urban waste projects involving pre-sorting for collection,
composting and recycling plants, and the closure of tips to comply with the relevant
directive.

Waste

Projects adopted in 2002

No of project

Name of project

Total cost
(€)

CF assistance
(€)

2000 ES 16 C PE 143 Waste management in Madrid

10 502 906

8 402 325

2000 ES 16 C PE 144 Waste  management  measures  in  the  Autonomous

9 348 364

7 478 691

Community of Valencia – 2001 – Group 1

2000 ES 16 C PE 145 Waste  management in the  Basque  Country  –  2001  –

23 946 052

19 156 842

Group 1 – Vizcaya

2001 ES 16 C PE 008 Waste  management  measures  in  the  Autonomous

33 700 224

26 960 179

Community of Andalusia – 2001 – Group 3

2001 ES 16 C PE 013 Waste  management in the  Basque  Country  –  2001  –

16 823 349

13 458 679

Group 2 Vitoria

2001 ES 16 C PE 025 Extension of facilities for the treatment of solid urban
waste in the Autonomous Community of Andalusia –
2001

21 034 274

16 827 419

2001 ES 16 C PE 027 Waste management in Aragón

7 608 670

6 086 936

2001 ES 16 C PE 028 Waste  management  in  the  Canary  Islands  –  2001  –

33 237 250

26 589 800

Group 1

2001 ES 16 C PE 029 Installation  of  a  tunnel  composting  system  in  the  Es
Milá waste centre - Menorca

1 627 290

1 301 832

2001 ES 16 C PE 042 Waste  management  in  Castile  La  Mancha  –  2001  –

24 749 725

19 799 780

Group 2

2001 ES 16 C PE 043 Management of solid urban waste in the Autonomous

12 276 145

9 820 916

Community of Extremadura – 2001

2001 ES 16 C PE 053 Closure of the tip for solid urban waste and the like at

5 000 000

4 000 000

San Marcos – Guipuzcoa – 1st phase

2001 ES 16 C PE 055 Construction  and  improvement  of  the  infrastructure

36 872 093

29 497 674

for treating municipal solid waste in Catalonia

2002 ES 16 C PE 001 Centre for the treatment of urban waste at Gomecello

18 030 363

14 424 290

– Salamanca

27

2002 ES 16 C PE 012 Waste  management  in  the  Autonomous  Community
of Andalusia – 2001 – Group 4

12 827 655

10 262 124

2002 ES 16 C PE 023 Waste  management  measures  in  the  Autonomous

40 298 984

32 239 187

Community of Castile-La Mancha – 2002

2002 ES 16 C PE 025 Waste management in Galicia – 2002

27 344 876

21 875 901

2002 ES 16 C PE 026 Infrastructure to develop the urban  waste Plan in the

13 013 172

10 410 537

region of Murcia

2002 ES 16 C PE 028 Waste  management  measures  in  the  Autonomous
Community of Valencia – 2002

20 803 064

16 642 452

2002 ES 16 C PE 029 Waste  management  measures  in  the  Autonomous

24 241 747

19 393 398

Community of Castile-Leon – 2002

2002 ES 16 C PE 041 Establishment  and  improvement  of  the  network  of
infrastructures for the treatment of municipal waste in
Catalonia

19 060 000

15 248 000

2002 ES 16 C PE 042 Improvement  of  the  facilities  for  the  incineration  of
to  comply  with

in  Catalonia 

municipal  waste 
Directive 2000/76/EC

11 934 740

9 547 792

2002 ES 16 C PE 049 Sludge  treatment  unit:  composting  and  heat  drying

34 401 169

27 520 935

plant at Loeches

Technical assistance - preliminary studies

In 2002, six decisions concerning preliminary studies and technical assistance were
approved, involving assistance of €8.8 million, of which €7 million was committed
that year. These studies are technical, economic and environmental in nature and are
required for the implementation of projects. The aim of technical assistance is to help
in  the  drafting  of  construction  projects  which  could  later  be  submitted  for  part-
financing.

Technical assistance – preliminary studies

Projects adopted in 2002

No of project

Name of project

Total cost
(€)

CF assistance
(€)

2002 ES 16 C PE 008 TA – Draining the Santoña marshes

959 250

2002 ES 16 C PE 010 TA  –  Water  supply  in  Villaviciosa,  Oviedo  and

402 670

815 362

342 270

Llanera

2002 ES 16 C PE 011 TA – Drainage in Ferrol, Lugo and Orense

2 036 870

1 731 339

2002 ES 16 C PE 013 TA  –  Extension  of  the  network  of  drainage

299 951

254 958

collectors and treatment station in Guadalajara

2002 ES 16 C PE 014 Drafting of the preliminary project and projects for
the  second  main  supply  ring  for  the  Autonomous
Community of Madrid

4 974 544

4 228 362

2002 ES 16 C PE 040 TA  –  Extension  of  water 

supply 

in 

the

1 682 000

1 429 700

Mancomunidad of Algodor

28

3.1.2.2 Transport

In  2002,  the  Commission  adopted  a  total  of  13  decisions  to  finance  projects  in  the
transport  sector  concerning  investments  totalling  some  €2  140  with  a  total
contribution  from  the  Cohesion  Fund  of  €1  444  million.  Commitments  in  2002
totalled  €1  046.2  million  and  related  to  new  decisions  adopted  that  year  and  to
amendments to and annual instalments of decisions adopted previously.

The  transport  sector  accounted  for  54.4%  of  the  total  assistance  under  decisions
approved  by  the  Commission  in  2002  and  53%  of  the  commitments  made.  The
breakdown by mode of transport is given in the following table.

Mode of transport

Eligible cost
(€ million)

CF assistance
(€ million)

Contribution to
assistance approved
in 2002

Commitments in
2002
(€ million)

Roads*

Railways

Ports

Airports

TOTAL

0

1 576.2

1 328.9

133.0

98.0

74.0

41.2

87.2%

7.4%

5.4%

29.0

888.8

95.5

32.9

1 807.2

1 444.1

100.0%

1 046.2

* The commitments for 2002 relate to annual instalments of projects approved before
2002

Road network

During 2002 there was a clear improvement in the implementation of projects for this
the  corresponding
mode  of 
appropriations could be committed. However, the Spanish authorities  made  no new
applications for assistance for 2002.

in  previous  years  so 

transport  approved 

that 

Rail network

In 2002, the Commission made a very concerted effort to invest in the development
of  the  network  of  high-speed  lines  in  Spain.  During  the  year  eight  new  decisions
were  approved,  the  most  significant  of  which  concerned  several  sections  of  the
Madrid–Valladolid  line  which,  with  the  Madrid–Barcelona–French  border  line,  is
one  of  the  14  major  projects  listed  as  priorities  by  the  Essen  European  Council
(9-10 December  1994).  Completion  of  the  Madrid–Valladolid  line  will  reduce  the
journey  time  between  those  two  cities  by  about  90  minutes  and  is  expected  to
increase the number of passengers  carried by  about 9 million by 2025.  Besides  the
advantages  stemming  from  the  line  from  Vitoria  to  Dax  (France),  the  Madrid–
Valladolid  section  will  make  a  substantial  contribution  to  integrating  the  rail
networks of northern and north-western Spain with the rest of the Union. This new
line is expected to come into service in 2007.

Work  on  the  other  projects  approved  or  being  implemented  progressed  as  planned,
according to the information provided at the Monitoring Committees.

29

RAIL PROJECTS ADOPTED IN 2002

No of project

Name of project

Total cost
(€ million)

CF assistance
(€ million)

CCI 2000-ES-16-C-PT-001

TGV 
(new sections)

Lleida–Tarragona

115.6

61.6

CCI 2001-ES-16-C-PT-012 à 018

TGV 
(sections I to VI)

Madrid–Valladolid

257.9

186.3

CCI  2001-ES-16-C-PT-002  and
003

TGV 
(Guadarrama tunnel)

Madrid–Valladolid

1 492.7

1081.0

TOTAL

Ports

1 866.2

1 328.9

During 2002, the Cohesion Fund provided finance for four new projects concerning
sea ports, in addition to the project to extend the Port of Barcelona approved in 2001.
Part-financing  by  the  Cohesion  Fund  concerns  work  to  extend  quays  or  construct
new ones to improve safety and increase shipping capacity.

All these projects comply with the Community guidelines for the development of the
trans-European transport networks. The case of the Puerto de la Estaca, on Hierro in
the  Canary  Islands,  is  particularly  representative,  since  it  is  a  very  important
communications link for that remote island.

30

PORTS PROJECTS ADOPTED IN 2002

No of Project

Name of project

Total cost
(€ million)

CF assistance
(€ million)

CCI 2001-ES-16-C-PT-002

Puerto  de  la  Estaca  (Canary
Islands)

CCI 2001-ES-16-C-PT-012

La Osa port (Asturias)

CCI 2001-ES-16-C-PT-019

Campamento port (Andalusia)

CCI 2002-ES-16-C-PT-001

Bilbao port

TOTAL

Airports

29.9

40.0

44.4

39.7

154.0

22.9

16.7

16.6

17.8

74.0

In the airport sector, during 2002 the Commission granted assistance for a project to
install  a  system  for  the  automatic  transfer  of  passengers  between  the  various
terminals  in  Madrid  -  Barajas  airport,  a  project  which  comes  under  measure  4  of
Annex II to Decision 1692/96/EC on the Community guidelines for the development
of the trans-European transport networks. The estimated total cost  of  this project is
€119.3 million and the aid approved amounts to €41.1 million.

Spain – Outermost regions

Operations continue to take account of the importance attached to the development
of the outermost regions (Canary Islands), as stressed in the Commission’s Report on
the  measures  to  implement  Article  299(2)  of  the  Treaty  (COM(2000) 147  final).
Community assistance this year totalled €49 million.

In the environment sector efforts concentrated on the waste sector, since their island
location makes the Canary Islands subject to very severe constraints as regards waste
the  construction  of
treatment.  The  measures 
environmental complexes were continued.

taken  previously  concerning 

As  regards  transport  infrastructure,  the  Puerto  de  la  Estaca  project  on  the  island  of
Hierro,  which  was  granted  assistance  totalling  €22.9  million,  provides  that  island
with  a  major  means  of  communication  since  it  enables  the  local  population  to
overcome  the  problems  posed  by  isolation  and  the  inconveniences  of  their  remote
location.

3.1.3.

Ireland

During 2002 the Commission did not approve any new Cohesion Fund assistance for
Ireland.  However,  the  grants  to  three  existing  projects  were  increased  by  a  total  of
€85.8  million  to  cover  extra  work  on  existing  projects.  Five  other  commitments
amounting to  €75  million  were  also  made  involving  subsequent  annual  instalments
for projects already adopted.

31

The  broad  pattern  of  commitments  is  influenced  by  the  size  of  the  allocation
available  to  Ireland  and  the  trend  of  recent  years  of  supporting  large  projects  with
multi-annual budgets.

In terms of commitments, a small group of large projects makes it relatively difficult
to  ensure  sectoral  balance  each  year.  Nonetheless  the  cumulative  position  between
transport and environment projects is now more balanced over the first years of the
2000-06 period following the commitments made in 2002. Starting from a proportion
of 19% : 81% in 2000 for the transport/environment balance the cumulative position
was 46% : 54% at the end of 2002. The objective is still to ensure a 50:50 balance
over the programme period.

12 projects from the period 1994-99 were also closed and the final reports for 5 other
projects were considered in 2002. Also seven projects from the 1994-99 period were
amended through formal amendment decisions.

3.1.3.1. Environment

The two priorities for the environment sector for the current period are the collection
and treatment of waste water and the management of solid urban waste.

Waste-water collection and treatment

No  new  project  was  assisted  in  2002.  An  existing  project  stage  –  Limerick  Main
Drainage Stage  III  was modified to  grant additional  assistance of  €30.6  million  for
the construction of additional elements  of the waste-water  collection system. These
works had been described in the original application for assistance but not originally
assisted.

WASTE-WATER TREATMENT

CCI N°

Project name

Type of
project/commitment

2002
commitment
(€ million)

2000 IE 16 C PE 001 Dublin  Region  Waste  Water

Third annual instalment

Treatment (Stage V)

1999 IE 16 C PE 002

Limerick Main Drainage (Stage III)

Third annual instalment

1999 IE 16 C PE 003

Cork Main Drainage (Stage III)

Second annual instalment

TOTAL

Solid waste

13.34

37.49

24.55

75.38

No project  was  assisted in 2002. The  Irish  authorities informed the  Commission  in
2002 that it would not be possible to absorb all of the indicative grant allocation of
€33  million  proposed  by  the  Commission  for  the  solid  waste  sub-sector.  The
Commission expressed its concern and disappointment at the uncertainty with regard
to  progress  in  this  area.  However  it  was  possible  to  agree  to  maintain  the
environment  /  transport  balance  of  commitments  in  the  period  2000-06,  the
Commission’s principal spending priority.

32

3.1.3.2. Transport

As  with  the  environment  sector  there  are  only  two  priority  sectors  in  this  period;
roads and public transport.

Roads

No new project was assisted in 2002. An existing project – M1 Cloghran Lissenhall
Stage  II  –  was  modified  to  grant  additional  assistance  of  €28.8  million  to  the
construction  of  additional  elements  of  motorway  and  the  realignment  of  existing
routes. These works had been described in the original application for assistance but
not originally assisted.

CCI N°

Project Name

Type of project/commitment

2002 commitment
(€ million)

2000 IE 16 C PT 002 M1  Cloghran  –  Lissenhall

Third annual instalment

(Stage II)

2000 IE 16 C PT 003 M1 Lissenhall Balbriggan

Second annual instalment

1999 IE 16 C PT 004 Heuston  Terminal  &  SW

Corridor (Stage I)

Second 
instalments

& 

third 

annual

TOTAL

Rail

45.77

10.23

51.28

107.28

No  new project was supported  in 2002.  The existing rail project – Heuston  Station
and  South  West  Rail  corridor  redevelopment  (Stage  I)  was  modified  to  grant
additional  assistance  of  €26.4  million  to  the  construction  of  additional  elements  in
Heuston Station, required in order to complete the station redevelopment. The initial
grant in respect of the  terminal  focussed  predominantly  on  the  track  and  signalling
elements. These additional works had not been described in the original application
for assistance.

3.1.4.

Portugal

2002 was an unusual year as regards implementation of the Cohesion Fund. For the
first time, it was not possible to commit the entire amount allocated to Portugal.

Following the infringement proceedings challenging the way in which Portugal had
granted  concessions  for  the  management  of  water  and  urban  waste  to  companies
controlled  by  the  public  company  Águas  de  Portugal,  a  number  of  projects  being
considered, particularly in the water sector, could not be approved.

Accordingly  the  Commission  approved  only  five  new  projects,  providing  finance
totalling  €106.1  million,  of  which  €84.9  million  was  committed  from  the  2002
budget.

Following  these  commitments  and  including  projects  adopted  in  previous  years
which  have  an  impact  on  the  budget  for  2002,  the  total  commitments  for  the  year
were as follows:

33

Environment 2002

Transport 2002

Environment previous years

Transport previous years

TOTAL

3.1.4.1. Environment

Total eligible cost
(€ million)

CF assistance
(€ million)

Commitments 2002
(€ million)

96

58

257.1

814.6

1 225.7

56.8

49.3

158.4

650.7

915.2

45.4

39.5

14.9

197

296.8

As in the previous period, the main priorities for assistance from the Fund in 2000-06
are  waste-water treatment,  the  supply  of  drinking  water  and  the  treatment  of  urban
waste. An effort was made to submit more projects in the field of the environment to
try  to  rebalance  the  amounts  allocated  to  each  field.  However,  the  infringement
procedure  referred  to  above  meant  that  most  of  the  amounts  committed  went  to
projects in the field of transport.

During  2002  the  Commission  adopted  four  new  projects  in  the  field  of  the
environment, two in the water sector and two in the urban waste sector.

Total eligible
cost
(€ million)

CF assistance
(€ million)

% of total
environment
assistance

Commitments 2001
(€ million)

Integrated water sector

Urban waste sector

29.1

66.9

18.9

37.9

33.3%

 66.7%

Projects  from  previous
years

TOTAL

Water

96

56.8

100 %

15.1

30.3

14.9

60.3

The  two  projects  approved  were  for  drainage,  one  concerning  studies  to  find
solutions  for  the  management  of  waste  water  in  the  Algarve  and  the  other  for
drainage works in the municipality of Braga.

Water sector

Projects adopted in 2002

No of project

Title

2002/PT/16/C/PE/004

Studies – Algarve drainage

2002/PT/16/C/PE/005

Drainage in Braga

Total eligible
cost
(€ million)

CF assistance
(€ million)

2.48

26.65

2.11

16.75

34

Urban waste

Unlike in previous years, in 2002 Portugal presented a very small number of projects
in  the  urban  waste  sector.  The  Commission  therefore  approved  only  two  projects
which follow on from other projects financed previously and which are designed to
complete the systems of which they form part.

One  is  a  project  at  Lipor  for  the  construction  of  an  organic  utilisation  centre;  the
other is the third phase of the system managed by the Association of municipalities
in the Vale do Ave.

Urban waste treatment

Projects adopted in 2002

No du project

Name of project

2002/PT/16/C/PE/002

Integrated  management  of  urban
waste at Lipor

2002/PT/16/C/PE/006

System for the treatment of waste in
the Vale do Ave – 3rd phase

Total cost
(€ millions)

CF assistance
(€ million)

53.52

13.36

26.6

11.35

3.1.4.2. Transport

As  already  noted,  in  2002  Portugal  sought  to  rebalance  the  consumption  of
appropriations between the two fields of the Cohesion Fund, which had hitherto leant
heavily  in  favour  of  transport.  Accordingly,  only  one  project  was  submitted,  for  a
section of the road on the  IP 6 main road between Peniche and  the  IC  1 secondary
road, which was approved as providing access to the trans-European de transports.

Total eligible
costs
(€ million)

Financial assistance
(€ million)

% of total
transport
assistance

Commitments
2002
(€ million)

Road sector

58.05

49.34

100 %

Projects  from  previous
years

39.47

196.99

TOTAL

58.05

49.34

100 %

236.46

3.2.

TECHNICAL ASSISTANCE AND STUDIES

3.2.1

Technical assistance at the initiative of the Commission

No measure for technical assistance at the initiative of the Commission was adopted
in 2002.

35

4.

MONITORING, INSPECTIONS AND IRREGULARITIES

4.1.

Monitoring: committees and missions

4.1.1. Greece

4.1.1.1 Monitoring Committees

The Cohesion Fund Monitoring Committee met in Athens in January 2002. The work
of this Monitoring Committee is recorded in the relevant minutes.

A number of technical meetings were also held in 2002. On 14 March, Commission
staff  and  representatives  of  the  Ministry  of  Public  Works  met  in  Athens  to  review
public works in the railway sector since the 1990s, assess all operational programmes
determine the state of affairs and identify what still needed to be achieved by the end
of the current programming period.

A meeting between  the Commission  and the  Ministry of  Economy  and Ministry  of
Transports was convened in Athens on 26 March to review the progress achieved in
the fields of transport  and the environment  and to follow up  the  conclusions  of the
Monitoring  Committee  meeting  in  January  2002.  Reinforcing  the  role  of  the
managing authorities in monitoring Cohesion Fund projects was also discussed.

In May 2002 the implementation of the environmental strategy in Greece was further
assessed to identify the areas where additional efforts were needed so as to complete
the  environmental 
the  smooth
implementation of the Cohesion Fund environmental strategy.

in  Greece  and 

thus  promote 

investments 

4.1.1.2. Monitoring missions

A number  of project  visits were undertaken in  April 2002, namely to  the  recycling
factory  in  Ano  Liossia,  the  Psitallia  water  treatment  plant  and  the  EYDAP  water
supply projects.

In June, a meeting between DG REGIO and the Greek Authorities was held to assess
the  implementation  of  big  national  projects  such  as  the  Gadouras  and  Aposellemi
Dams.  In  September,  another  technical  meeting  allowed  individual  assessment  of
some requests for amendments to decisions taken in previous years.

A further meeting between DG REGIO and the Greek Authorities was held in Athens
in  October  to  discuss  strategic  issues  in  the  environmental  sector  and  review  the
commitments for  2003. This included  assessing  progress  in  implementing  the  solid
waste  strategy  and  consideration  of  the  objectives  for  the  future  so  as  to  fully
implement the agreed environmental strategy.

36

4.1.2.

Spain

4.1.2.1. Monitoring Committees

The Monitoring Committee met twice in Madrid in 2002.

The  first  meeting  lasted  from  30  January  to  1  February  and  the  second  from  23  to
25 October.  These  were  the  16th  and  17th  meetings  of  the  Cohesion  Fund
Monitoring Committee.

The Committee is subdivided into several specific sessions depending on the sectors
concerned and the managing authorities involved so as to look at the implementation
of  a  series  of  projects  and  groups  of  projects  (about  170  decisions  in  all  for  each
Committee)  requiring  a  specific  discussion  with  the  authorities  responsible  for
implementation and chosen in advance jointly by the relevant staff in the Ministry of
Finance and the Commission. Figures on the projects not selected are also put before
the Committee and sent to the Commission for information.

At  the  two  meetings  the  Committee  considered  a  number  of  important  points  of
general interest including:

–  checking the quality of applications for part-finance and the final reports,

–  the  application  of  automatic  decommitment  for  projects  on  which  work  has  not

begun two years after the approval decision,

–  the statutory requirements governing publicity,

–  the  results  of  the  inspections  with  particular  regard  to  compliance  with

Community law on public procurement,

–  the management of on-going projects, particularly speeding up the closure of old

decisions and reducing the number of amendments requested,

–  the reliability of estimates of future payments.

4.1.2.2. Monitoring missions

The  missions  were  carried  out  to  assess  and  check  the  progress  of  projects  being
implemented and to clarify the difficulties encountered in their implementation.

The monitoring missions undertaken are listed in Annex 1.

4.1.3.

Ireland

4.1.3.1. Monitoring Committees

In  2002  there  were  two  meetings  of  the  Monitoring  Committee,  on  19  April  and
31 October.  On  the  whole,  the  Commission  was  satisfied  with  the  quality  of  the
information  the  Irish  authorities  supplied  on  the  management  of  projects  and
outstanding questions were addressed adequately.

At these meetings the Committee examined written progress reports on up to 30 open
projects from the period 1993-99 and on 7 projects from the period 2000-06.

37

There  was  also  progress  with  the  successful  completion  of  12  further  projects  in
2001.  The  outstanding  projects  from  the  period  1993-99  to  be  closed  at  end-2002
represent 16% of the project supported in that period.

One project in particular was the subject of detailed examination by the Commission
in 2001-02. The ‘Rail track and signalling project’ assisted in 1997 concerns a group
of  five  related  rail  projects.  One  of  these  projects  -  the  signalling  project  called
“mini-CTC”  -  experienced  serious  implementation  delays,  cost  overruns,  the
cancelling  of  the  original  contract  and,  in  2001-02,  a  national  parliamentary  public
enquiry into the rail company’s management. While the report of the public enquiry
was never finalised, the Commission examined carefully the reasons for the delayed
implementation of the project  and the strategy proposed to  complete  the  mini-CTC
project.  In  2002  DG  REGIO  arranged  a  technical  audit  of  the  robustness  of  this
completion  strategy.  The  evaluation  was  essentially  positive  in  respect  of  its  main
elements.  In  that  light  and  because  the  amendment  to  the  end  date  sought  was  the
first such amendment to the project, the Commission adopted an amending decision
in late 2002 to maintain support for completion of the mini-CTC project.

In respect of the general policy on project modifications and/or extension requests in
2002,  the  Commission  presented  the  Irish  authorities  (in  common  with  other  CF
beneficiary states) with new guidance on project changes to restrict the possibility to
modifying decisions which have been subject to several amendments.

4.1.3.2. Monitoring missions

The project visits undertaken in 2002 had the following objectives:

- to check progress in the completion of the relevant projects, and

- to clarify difficulties reported to the Monitoring Committee previously and requests
made to approve project amendments.

The project visits undertaken are listed in Annex 1.

4.1.4.

Portugal

4.1.4.1. Monitoring Committees

As required by the Fund Regulation, the Monitoring Committee meets twice a year.

In 2002 these meetings took place on 27 and 28 May and 11 and 12 December. They
considered each project individually and provided an opportunity to discuss general
topics such as publicity, inspections, public procurement, the implementing rules and
miscellaneous information.

Although  the  project  for  the  construction  of  the  Alqueva  hydroelectric  station  is
monitored by the general Committee, it is also monitored in the broader forum of the
Structural  Funds  Monitoring  Committee  for  the  specific  integrated  development
programme for the Alqueva (PEDIZA).

38

4.1.4.2. Monitoring missions

Besides  attending  meetings  of  the  Monitoring  Committee  and  taking  part  in  some
inspections  by  Unit  G7,  in  2002  the  Portugal  unit  of  the  Directorate-General  for
Regional  Policy  carried  out  a  number  of  monitoring  missions  to  check  on  the
progress of projects, acquire on-the-spot knowledge of the problems encountered in
implementation  and  find  the  best  solutions  for  the  correct  implementation  of  the
projects (see Annex I).

4.2.

Inspections and conclusions

In 2002, the Directorate-General for Regional Policy carried out 22 audit missions in
the  four  Member  States  assisted  by  the  Cohesion  Fund.  Problems  of  various  types
were  detected  in  all  four  countries,  mainly  regarding  the  procedures  for  awarding
public contracts. It was found that compliance with Decision 96/455/EC on publicity
had improved, although further efforts were still required.

Following  the  adoption  in  July  2002  of  the  new  Commission  Regulation  (EC)
No 1386/2002  on  the  management  and  control  systems  for  assistance  granted  from
the  Cohesion  Fund  and  the  procedure  for  making  financial  corrections,  the  four
Member  States  made  considerable  efforts  to  adjust  their  organisation  to  meet  its
requirements.

The irregularities detected in the four Member States are now the subject of financial
correction procedures.

4.2.1. Greece

Five audits were carried out in Greece in 2002 to examine eight decisions concerning
the Cohesion Fund.

The main findings concerned application of the rules on public procurement and the
quality  of  the  estimates  of  the  cost  of  works  as  part  of  the  cost-benefit  analysis  of
projects.

4.2.2.

Spain

Nine audit missions in Spain looked at 17 Cohesion Fund decisions.

Spain’s decentralised organisation means that the situation varies across the country.
However, the inspections by the Directorate-General for Regional Policy give rise to
a certain number of conclusions.

The main shortcomings concerned the application of the rules on public procurement
(confusion between the selection criteria and those for awarding the contracts, use of
the ‘baja temeraria’ rule) and the inclusion of ineligible expenditure (VAT, purchase
of land belonging to public administrations).

39

4.2.3.

Ireland

Four audit missions were carried out in Ireland in 2002 and covered nine decisions.
The  main  irregularities  detected  concerned  failure  to  comply  with  the  rules  on  the
eligibility of expenditure (work carried out and paid before approval of the decisions)
and failure to comply with the rules on public procurement (no tendering procedure
for the award of certain service contracts).

4.2.4.

Portugal

Four inspections were carried out in Portugal in 2002; they covered seven Cohesion
Fund decisions.

The main irregularities concerned the application of the rules on public procurement
(no  tendering  procedure  for  the  award  of  service  contracts)  and  the  submission  of
applications for payment containing ineligible expenditure (construction of car parks
or administrative premises).

4.3.

Irregularities and suspension of aid

In November and December 2002, the European Anti-Fraud Office (OLAF) carried
out  joint  audits  with  DG  REGIO  in  the  four  beneficiary  Member  States  to  look  at
their  implementation  of  Commission  Regulation  (EC)  No  1831/94  concerning
systems  and  procedures  for  the  notification  and  monitoring  of  irregularities  in  this
field.  This  audit  was  carried  out  alongside  those  concerning  the  application  of
Regulation (EC) No 1681/94 in the field of the Structural Funds. The conclusions of
the audits will be sent to the Member States, the Council, the European Parliament
and the European Court of Auditors.

Article 3 of Regulation (EC) No 1831/9413 concerning irregularities and the recovery
of sums wrongly paid in connection with the financing of the Cohesion Fund and the
organisation of an information system in this field requires the beneficiary Member
States  to  notify  the  Commission  of  irregularities  as  soon  as  a  preliminary
administrative or judicial finding has been made.

For  2002,  three  of  the  four  Member  States  benefiting  from  the  Cohesion  Fund,
namely: Greece, Ireland and Portugal, communicated to the Commission 4 cases of
irregularities  under  the  terms  of  Regulation  1831/94.  Greece  and  Ireland  each
communicated one a case and Portugal two.

The  case  communicated  by  the  Greek  authorities  involved  overall  973,444  €  of
Community  contribution  and  the  irregularity  concerned  the  non-observance  of  the
rules on tendering. On the other hand, the case communicated by the Irish authorities
concerned  overall  5,885  €  of  Community  contribution  and  the  irregularity  was
related to the presentation of non eligible expenditure. The amount in question was
recovered  at  national  level.  The  cases  communicated  by  Portugal  involved  overall
8,842,900  €  of  Community  contribution  an  amount  of  which  of  8,024,246  €  was
suspended  at  national  level.  The  detected  irregularities  also  concerned  the
presentation  of  non  eligible  expenditure,  the  presentation  of  incorrect  supporting

13

OJ L 191, 29.7.1994.

40

                                                
documents and of the problems due to accountancy. The amount of 818,654 € paid to
the recipients was recovered at national level.

It  should  to  be  noted  that  Spain  informed  the  Commission,  under  the  above-
mentioned regulation, that it had no cases of irregularities during the year.

5.

ASSESSMENT AND EVALUATION

5.1.

General

Since  the  ultimate  objective  of  EU  policies  is  to  maximise  economic  development
and reduce regional disparities in terms of per capita GDP and unemployment rates,
the  most  serious  issue  encountered  in  making  cost-benefit  analyses  of  project
investments  applying  for  part-finance  from  the  Cohesion  Fund  is  the  lack  of
economic analysis or the fact that the economic analysis is very often poorly carried
out.

This  has  led  to  the  suspension  of  a  number  of  project  proposals  whose  main  focus
was  on  financial  analysis  only.  In  this  regard,  however,  the  contribution  of  the
Commission has also been pedagogic. The relevant reports place heavy emphasis on
how to guide project promoters towards more sound evaluations in the different areas
of economic analysis found to be unsatisfactory.

In  addition,  the  financial  analysis  of  some  investment  projects  revealed  that,  after
revising  their  cost-benefit  analysis,  project  promoters  realised  that  investment
projects  actually  needed  significantly  lower  EU  contributions.  This  is  clearly  a
crucial aspect in order to maximise the effectiveness of the public money devoted to
the  EU  structural  policies  since  it  allows  a  larger  number  of  projects  to  be  part-
financed.  Furthermore,  many  project  reports  included  no  risk  analysis.  The
Commission has strongly advised project promoters to use this technique not only to
enhance  the  probability  of  project  success  by  making  the  project  financially  more
robust,  but  also  to  improve  its  impact  on  regional  development  by  identifying  the
main  critical  variables  in  the  project  and  implementing  consistent  project  re-
specifications.

5.2.

Examination and ex-ante appraisal of projects

As  part  of its  updating  of the Guide  for  the  cost/benefit  analysis  of  major  projects,
during  2001  the  Commission  carried  out  substantial  internal  work  to  make  the  ex-
ante  financial  analysis  of  the  various  projects  more  consistent.  This  included
consideration  of  the  discounting  rate  used,  the  arrangements  for  applying  the
polluter-pays  principle  to  water  management  projects,  taking  account  of  historic
costs prior to the submission of a project to the Commission in calculating financial
profitability  and  the  possible  accounting  for  financial  costs.  The  results  of  these
considerations were presented to the Member States during 2002.

41

5.3.

Cooperation with the EIB when a project is considered

Under a framework contract signed by the two institutions in 2000 and valid until the
end of 2006, the Commission may ask the European  Investment Bank for technical
assistance  in  appraising  Cohesion  Fund  projects,  major  projects  supported  by  the
ERDF and projects financed by ISPA. It also receives  regular information from the
EIB about projects submitted to one of these three Funds to which the Bank has itself
decided to grant assistance.

5.4.

Economic and social impact of the Fund in the Member States and on economic
and social cohesion, including employment, in the European Union

The Regulation establishing a Cohesion Fund requires the Commission to assess the
economic  impact  of  the  Fund,  both  in  terms  of  each  project  and  in  terms  of
Community assistance as a whole.

The new version of the Guidelines on cost-benefit analysis is more exhaustive than
the former and it better accomplishes a pedagogical task through discussing the key
issues of cost-benefit  analysis by  practical  examples. So  that  it can be  used  swiftly
and  be  available  to  desk  officers  and  to  Member  State  promoters,  the  current
guidelines  may  be  consulted  in  English,  and  from  April  in  other  languages,  on  the
DG REGIO web-site.

5.5.

Harmonisation and simplification

The Commission has undertaken actions to make the practices followed in different
Member  States  more  consistent.  In  particular,  these  actions  have  been  focussed
especially  on  harmonising  some  key  elements  of  evaluation  such  as  discount  rates,
contingencies, amortisation (which has been eliminated), adaptation of the financing
gap formula (in order to stimulate the application of the polluter-pays principle) and
the use of residual historical costs. This has been achieved by undertaking intensive
bilateral  and  multilateral  discussions.  The  latter  resulted  in  agreements  with  the
relevant  authorities  that  this  harmonisation  will  be  fully  applied  from  2003.
Additionally, in order  to  ease  the  informational  burden  of  cost-benefit  analysis  and
according  to  the  principle  of  proportionality,  the  Directorate-General  for  Regional
Policy has also laid down simplified rules.

6.

INTER-INSTITUTIONAL DIALOGUE, INFORMATION AND PUBLICITY

6.1.

Annual report for 2001

6.1.1.

European Parliament

On the basis of the reports by Mr Turco (2000 report on the Cohesion Fund) and Ms
Scallon (2001 report), Parliament raised the question of the use made of the ex-post
evaluation  of  projects  already  completed  in  the  new  programming  phase  and  the
training measures which the Commission could undertake to lay down criteria for ex-
ante evaluation which would offer genuine uniformity across the Member States. It
also  asked  the  Commission  to  continue  rigorous  inspections  of  the  rules  on
transparency  as  regards  public  contracts.  It  regretted  the  inadequate  level  of
commitments and payments despite an improvement in budgetary implementation in

42

2001. It also regretted that the report did not include specific and precise figures on
the amount to be settled under the Cohesion Fund.

In  its  annual  report  for  2001,  the  Commission  sought  to  present  detailed  budget
figures,  particularly  as  regards  the  amount  to  be  settled.  Furthermore,  Parliament’s
resolution  encouraged  the  Commission  to  step  up  cooperation  between  the
Directorates-General responsible for regional policy, transport and the environment.

6.2.

Information from the Member States

Two  information  meetings  with  all  15  Member  States  were  held  in  Brussels,  on
27 June and 21 November 2002.

At the first meeting the Commission presented the “guidelines for the amendment of
projects”, the 2002-03 programme for inspection and audit missions, the allocations
of appropriations for 2002 for each Member States and the payment forecasts and the
draft Regulation on financial corrections (which came into force on 1 January 2003).

At  the  information  meeting  in  November,  the  Commission  a  presented  the  annual
report  of  the  Cohesion  Fund  for  2001,  the  situation  as  regards  the  EEA  financial
instrument and the position of commitments in 2002.

6.3.

Commission measures on publicity and information

The integration of Cohesion Fund activities into the overall activities of DG REGIO
has been consolidated since 2000, so their  coverage  has become  an integral part of
the overall information and communication actions of the DG.

In particular the programme of ad hoc actions such as publications, photo reports and
events has taken account of Cohesion Fund projects, notably the photo reportage of
Greece completed in December 2002. This was undertaken in preparation for the last
in  the  present  series  of  individual  country  brochures  illustrating  the  range  and
characteristics of the Community’s cohesion policy.

These actions will continue in 2003, particularly in the light of the possible increase
in numbers of countries eligible to Cohesion Fund following the enlargement of the
EU in 2004.

A key moment of the year was the seminar in March 2002 comparing progress in the
field  of  the  information  and  publicity  requirements  (Article  14  of  Regulation  (EC)
No  1164/94,  so  far  as  the  Cohesion  Fund  in  concerned)  in  Objective  1  regions
including the four cohesion countries. Member States have a responsibility to inform
their  citizens  effectively  and  openly  about  structural  fund  assistance  and  Cohesion
Fund projects, and the Commission has established a number of mechanisms to help
them fulfil this requirement.

43

ANNEX I

List of monitoring and quality-control missions carried out in 2002 

Greece

January:  Cohesion  Fund  Monitoring  Committee  meeting.  Progress  achieved  and  the  future
priorities for implementing the agreed environmental and transport strategy were reviewed.

14 March: Senior officials from the Commission and the Ministry of Transport met to discuss
the public works in the railways sector.

26  March:  Progress  in  implementing  the  agreed  priorities  in  the  field  of  transport  and
environment were reviewed.

April: The purpose of the visit was to verify progress for the following projects, i.e. EYDAP
water supply projects, the Psitalia water treatment plant and on the spot visit of the recycling
factory in Ano Liossia.

June: Big national projects in the field of the environment were examined.

June: Quality control mission at  the  headquarters  of  ERGOSE  –  authority  that  manages  the
railways projects in Greece.

September: Requests for amendments to decisions were considered in depth.

October: The environment and transport priorities for 2003 were put into perspective.

Spain

July:  The  Salto  del  Negro  complex  on  Gran  Canaria  and  the  Arico  complex  on  Tenerife
(projects  concerning  waste  management  in  the  Autonomous  Community  of  the  Canary
Islands)  were  inspected  by  the  Commission  and  the  difficulties  in  providing  stable
management for the project were noted. Following comments by the Commission, the various
public bodies signed an agreement to establish a stable management system.

September: Visits to the areas concerned by the projects ‘Collectors and treatment station at
Las  Navas  del  Marqués (Avila)’  (CF No  98.11.61.036)  and  ‘Expansion  of  supply  at  Las
Navas del Marqués (Avila)’ (CCI 2002.ES.16.C.PE.003), which provided all the information
required to complete examination of the application to amend the physical object of the first
project,  approved  by  Decision  C(2002)  3512  of  6  November  2002,  and  the  application  for
assistance for the second project, approved by Decision C(2002) 4270 of 16 December 2002.

Inspections of work on the projects ‘Treatment station for the middle and upper basin of the
Arroyo Culebro- Fuenlabrada Section (Madrid)’ (CF No 98.11.61.004) and ‘Gavia treatment
station (Madrid)’ (CF No 98.11.61.018), and the areas affected by the ‘Treatment station for
the  lower  basin  of  the  Arroyo  Culebro  –  Getafe  sector  (Madrid)’  project  (CCI  No
2000.ES.16C.PE.032),  which  provided  all  the  further  information  required  to  complete
examination  of  the  application  to  amend  the  latter  project  approved  by  Decision  C(2002)
4652 of 18 December 2002.

44

Ireland

July: Limerick, Burren and North Clare

– 

– 

– 

– 

Project No 99/07/61/002 - Limerick City and environs Main Drainage Scheme (Stage
III):  The  Commission  verified  that  physical  progress  was  on  schedule  and  would
meet  the  deadline  of  the  current  grant  decision.  The  Commission  also  discussed
elements  of  the  project  which  could  be  further  supported  if  extra  Cohesion  Fund
monies became available.

Project  No  96/07/61/009  -  Limerick  Water  Supply  Scheme  (Stage  II):  The
Commission  verified  that  the  project  was  physically  complete  and  the  water
treatment  and  sewerage  treatment  plants  were  in  operation.  The  Commission  also
discussed final reporting and closure requirements.

Project 95/07/61/002 - North Tipperary Water Supply: The Commission was able to
see  the  extent  of  the  improvements  made  to  the  treatment  plant  and  of  the
refurbishment  made  to  the  existing  water  intakes.  The  Commission  monitored
progress  with  the  finalisation  of  the  project  and  saw  evidence  of  the  information
measure. Closure documentation was also discussed.

Project 94/07/61/010 - Burren and North Clare Water Services Plan: The purpose of
the  visit  was  to  verify  the  completion  of  the  project.  The  water  treatment  and
sewerage treatment plants were already in operation and the Commission explained
the  documentation  required  for  closure.  The  Commission  saw  evidence  of  the
information campaign and the sculpture placed in Lisdoonvarna to commemorate the
project.

Portugal

April: Visit 
to  projects  2001/PT/16/C/PT/001  and  2000/PT/16/C/PT/003  concerning
modernisation  of  the  Algarve  railway  line,  with  particular  attention  to  the  publicity  to  be
given to the projects financed.

June: Mission to monitor three projects:

– 

– 

– 

Project  1996/PT/16/C/PE/003  on  drainage  in  the  Ria  de  Aveiro  which  looked  at  a
number  of  technical  aspects  with  those  responsible  for  the  project  including  the
treatment and final destination of sludge, the control of effluent and the tariff system.

Project 2000/PT/16/C/PE/007 on the supply of water to the Zêzere/Côa to assess the
relevance of the amendments requested to the initial project.

Project  2000/PT/16/C/PE/015  on  the  system  for  treating  solid  waste  at  Cova  da
Beira,  to  discuss  possible  financial  difficulties  of  the  project  promoter  and  the
possibilities of transferring responsibility for project implementation to another body.

November:
Project  2001/PT/16/C/PE/002  concerning  all  the  assistance  to  improve  water
management  on  Madeira  was  inspected  as  regards  the  work  at  Porto  Santo  to  draw  the
attention of those responsible to the need to respect the quality of effluent discharged at sea.

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Other technical missions concerning the examination of certain applications took place during
the year and included the integrated multi-municipal water systems promoted by the Águas de
Portugal group.

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