Communication from the Commission to the Council and the European Parliament - Instrument for pre-accession assistance (IPA) multi-annual indicative financial framework for 2008-2010
Date: 2006-11-08
Institutions: European Commission
Subjects: Bosnia and Herzegovina, Croatia, EU financial instrument, Kosovo, Montenegro, North Macedonia, Serbia, Türkiye, accession to the European Union

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 8.11.2006 
COM(2006) 672 final 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND 
THE EUROPEAN PARLIAMENT 

INSTRUMENT FOR PRE-ACCESSION ASSISTANCE (IPA) 
MULTI-ANNUAL INDICATIVE FINANCIAL FRAMEWORK FOR 2008-2010 

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COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND 
THE EUROPEAN PARLIAMENT 

INSTRUMENT FOR PRE-ACCESSION ASSISTANCE (IPA) 
MULTI-ANNUAL INDICATIVE FINANCIAL FRAMEWORK FOR 2008-2010 

Introduction 

As part of the preparation for the new Financial Framework 2007-2013, a proposal for a new 
Instrument  for  Pre-accession  Assistance  (IPA)  was  presented  by  the  Commission  to  the 
European Parliament and the Council in September 2004. The IPA Council Regulation (EC) 
No 1085/2006 was adopted on 17 July 2006.  

IPA  aims  to  provide  targeted  assistance  to  countries  which  are  candidates  or  potential 
candidates  for  membership  of  the  EU.  In  order  to  achieve  each  country's  objectives  in  the 
most  efficient  way,  IPA  consists  of  five  different  components:  transition  assistance  and 
institution  building;  cross-border  cooperation;  regional  development;  human  resources 
development; and rural development. For candidate countries, measures relating to regional, 
human  resources  and  rural  development  will  be  available  under  the  relevant  components 
which are designed to prepare for the implementation of EU cohesion and agricultural policies 
after accession. This requires that the country has the administrative capacities and structures 
to  take  responsibility  for  the  management  of  assistance.  In  the  case  of  potential  candidate 
countries, such measures will be implemented through the transition assistance and institution 
building component. 

The  Multi-Annual  Indicative  Financial  Framework  (MIFF)  for  the  Instrument  of  Pre-
Accession Assistance (IPA) is designed to provide information on the indicative breakdown 
of the overall IPA envelope proposed by the Commission in accordance with article 5 of the 
IPA Regulation (EC) 1085/2006. It acts as the link between the political framework within the 
enlargement  package  and  the  budgetary  process.  The  Multi-Annual  Indicative  Planning 
Document (MIPD) established for each beneficiary country, through which pre-accession aid 
for that country is delivered, will take into account the indicative breakdown proposed in the 
MIFF. 

The MIFF is based on a rolling three-year programming cycle. Under normal circumstances, a 
MIFF for years N, N+1 and N+2 will be presented in the last quarter of year N-2 as part of the 
enlargement  package,  representing  a  proposed  financial  translation  of  the  political  priorities 
set out within the package itself, taking into consideration the Financial Framework. 

Due to delays in the agreement of a new Financial Framework for 2007-2013, as well as those 
in the adoption of the IPA regulation, it was not possible to present a MIFF for 2007-2009 in 
this timeframe. This Multi-Annual Indicative Financial Framework which covers 2008-2010 
is therefore the first MIFF under IPA and also confirms the 2007 figures which were provided 
to  Council  and  Parliament  in  the  Commission's  Preliminary  Draft  Budget  2007.  It  indicates 
the allocation of the envelope for pre-accession assistance by country and by component, and 
also  gives  an  indication  of  the  envelope  for  regional  and  horizontal  programmes  and  the 
amounts allocated to support expenditure. 

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Political and Strategic Framework 

The  overall  political  priorities  for  pre-accession  are  set  out  in  the  European  and  Accession 
Partnerships, the annual country reports and the enlargement strategy paper contained in the 
enlargement package presented to the Council and European Parliament each year.  

This MIFF has been constructed on the basis of the 2006 enlargement package. The opening 
of negotiations with Turkey and Croatia in October 2005 and the decision to grant the former 
Yugoslav Republic of Macedonia candidate status, as well as a reminder that the rest of the 
Western Balkans are potential candidate countries to the European Union provide the overall 
political context. 

The  Western  Balkans  is  a  particular  challenge  for  the  EU.  Enlargement  policy  needs  to 
demonstrate  its  power  of  transformation  in  a  region  where  states  are  weak  and  societies 
divided. A convincing political perspective for eventual integration into the EU is crucial to 
keep their reforms on track. But it is equally clear that these countries can join only once they 
have met the criteria in full. 

There  is  no  further  enlargement  with  a  large  group  of  countries  at  the  same  time  in  view. 
Accession negotiations with Turkey are a long-term process. The Western Balkans contains 
smaller countries at different stages on their road towards the EU. Future enlargements will go 
at  the  pace  dictated  by  each  country's  performance  in  meeting  the  rigorous  standards,  to 
ensure the smooth integration of new members. The EU has set political and economic criteria 
for  membership,  as  well  as  criteria  related  to  the  obligations  for  membership  and  the 
administrative capacity to implement and enforce the EU's laws and policies. 

The  perspective  of  moving  to  the  next  stage  in  relations  with  the  Union  is  a  powerful 
incentive  for  countries  to  transform  themselves  and  to  adopt  EU  standards  and  values.  The 
journey  towards  membership  has  a  value  in  itself,  even  in  cases  where  accession  is  many 
years  away.  This  journey  is  often  difficult,  so  it  is  essential  for  the  EU  to  stay  engaged 
throughout the process, and committed to the outcome. 

Strategic Financial Programming 

1. 

Allocation of funds between countries 

Following the negotiations on the Financial Framework 2007-2013, the Commission 
undertook to at least ensure that no beneficiary country would receive less in 2007 
than it did in 2006. Thus, this was the basis for calculations. Further than this, it was 
decided  that  Bosnia  and  Herzegovina  and  Albania  should  receive  no  less  than  the 
annual  average  of  the  funding  each  received  between  2004  and  2006.  This  reflects 
the fact that the funding in these years was frontloaded in 2004. 

As a proxy for needs and impact, per-capita allocations have been quoted in the past. 
Against  this  measure,  each  country  of  the  Western  Balkans  will  reach  at  least  the 
2004-2006 per-capita average of 23 € received under CARDS.  

For Croatia and the former Yugoslav Republic of Macedonia, as candidate countries, 
a level of over 30 € per capita (in 2004 prices) by 2008 is envisaged.  

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For Turkey, taking into account the size and absorption capacity of the country, there 
is a gradual increase in assistance over the period 2007-2013. 

The needs and absorption capacities of each individual country have been considered 
in the allocation process. 

2. 

Allocations between components  

The  starting  point  for  the  calculation  of  allocations  between  components  for 
candidate countries was an examination of the split between similar activities under 
Phare, ISPA and SAPARD in the past. From this basis, due account has been taken 
of  the  readiness  of  the  management  systems  in  the  current  candidate  countries  and 
the  need  for  component  II  funding  as  it  relates  to  cross-border  cooperation  with 
Member  States  to  match  that  of  the  equivalent  European  Regional  Development 
Fund (ERDF) funding from heading 1b. 

Presentation of the figures 

The following table provides the above figures in current prices and in million euros. It shows 
the  allocations  by  country  and  by  component,  as  well  as  for  the  regional  and  multi-country 
programmes  and  support  expenditure.  In  line  with  current  practice,  funding  for  Kosovo1  is 
displayed separately and will be the focus of a separate MIPD.  

(a) Support expenditure 

As  well  as  the  support  necessary  for  the  implementation  of  IPA  funds,  the  support 
expenditure  also  needs  to  cover  the  phasing  out  of  previous  pre-accession  funding, 
including for Bulgaria and Romania.  

(b) Envelope for regional and horizontal programmes  

The  regional  and  multi-country  programme  will  include  actions  similar  to  the 
regional programme under CARDS and the multi-country envelope under the Phare 
and Turkey pre-accession instruments. The level of funding is such that both types of 
action  are  possible.  Since  2006,  there  has  been  an  increased  involvement  of 
International Financing Institutions in pre-accession, including a new instrument for 
energy  efficiency.  Figures  reflect  the  increased  need  for  such  programmes.  The 
phasing  out  of  interim  civilian  administrations  will  also  be  funded  from  this 
envelope. Programmes funded under this envelope will be complementary to national 
programmes  and  will  only  be  eligible  if  they  provide  an  added  value  to  the  pre-
accession process. 

1 

As  defined  by  the  United  Nations  Security  Council  Resolution  1244  of  10  June  1999  and  repealing 
Decision 2004/520/EC (2006/56/EC) 

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Multi-Annual Indicative Financial Framework: 
Breakdown of the Instrument for Pre-Accession Assistance Envelope 
For 2008-2010 into allocations by country and component 

Country 

Component 

2007 

2008 

2009 

2010 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

252.2

250.2

233.2 

211.3 

6.6

8.8

9.4 

9.6 

TURKEY 

Regional 
Development 

167.5

173.8

182.7 

238.1 

Human  Resources 
Development 

50.2

52.9

55.6 

63.4 

Rural Development 

20.7

53.0

85.5 

131.3 

Total 

497.2

538.7

566.4 

653.7 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

47.6

45.4

45.6 

39.5 

9.7

14.7

15.9 

16.2 

CROATIA 

Regional 
Development 

44.6

47.6

49.7 

56.8 

Human  Resources 
Development 

11.1

12.7

14.2 

15.7 

Rural Development 

25.5

25.6

25.8 

26.0 

Total 

138.5

146.0

151.2 

154.2 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

Former 
Yugoslav 
Republic of 
Macedonia 

Regional 
Development 

Human  Resources 
Development 

Rural Development 

41.6

39.9

38.1 

36.3 

4.2

7.4

3.2

2.1

5.3

5.6 

5.7 

12.3

20.8 

29.4 

6.0

6.7

7.1 

8.4 

10.2 

81.8 

12.5 

92.3 

Total 

58.5

70.2

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Transition  Assistance 
Institution 
and 
Building 

Cross-border 
operation  

Co-

SERBIA 

178.5

179.4

182.6 

186.2 

8.2

11.5

12.2 

12.5 

Total 

186.7

190.9

194.8 

198.7 

MONTENEGRO 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

27.5

28.1

28.6 

29.2 

3.9

4.5

4.7 

4.8 

Total 

31.4

32.6

33.3 

34.0 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

KOSOVO 

60.7

62.0

63.3 

64.5 

2.6

2.7

2.8 

2.8 

Total 

63.3

64.7

66.1 

67.3 

BOSNIA & 
HERZEGOVINA 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

58.1

69.9

83.9 

100.7 

4.0

4.9

5.2 

5.3 

Total 

62.1

74.8

89.1 

106.0 

Transition  Assistance 
and 
Institution 
Building 

Cross-border 
operation  

Co-

ALBANIA 

54.3

61.1

70.9 

82.7 

6.7

9.6

10.3 

10.5 

Total 

61.0

70.7

81.2 

93.2 

Total Country Programmes 

1098.7

1188.6

1263.9 

1399.4 

Regional and Horizontal Programmes 

100.7

140.7

160.0 

157.7 

ADMINISTRATIVE COSTS 

55.8

54.0

56.5 

64.6 

GRAND TOTAL 

1255.2

1383.3

1480.4 

1621.7 

Figures are in million euros, current prices 

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