Commission staff working document - Annex to the 19th annual report on implementation of the structural funds (2007) - Parts 1 – 3 {COM(2008) 659 final}
Date: 2008-10-20
Institutions: European Commission
Subjects: Community budget, Structural Funds, activity report, implementation of the budget, structural expenditure

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 20.10.2008 
SEC(2008) 2649 

COMMISSION STAFF WORKING DOCUMENT 

Annex to the 

19TH ANNUAL REPORT ON IMPLEMENTATION OF  
THE STRUCTURAL FUNDS (2007) 

PARTS 1 – 3 

{COM(2008) 659 final} 

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TABLE OF CONTENTS 

Part 1: General analysis of activities .......................................................................................... 4 

1. 

2. 

3. 

4. 

5. 

6. 

Introduction .................................................................................................................. 4 

Analysis of implementation ......................................................................................... 5 

Consistency and Coordination ................................................................................... 13 

Evaluations................................................................................................................. 19 

Controls ...................................................................................................................... 21 

Committees Assisting the Commission ..................................................................... 28 

Part 2: Analysis by Member State............................................................................................ 31 

1. 

2. 

3. 

4. 

5. 

6. 

7. 

8. 

9. 

10. 

11. 

12. 

13. 

14. 

15. 

16. 

17. 

18. 

19. 

20. 

21. 

Belgium ...................................................................................................................... 31 

Cyprus ........................................................................................................................ 36 

Czech Republic .......................................................................................................... 38 

Germany..................................................................................................................... 42 

Denmark..................................................................................................................... 48 

Greece ........................................................................................................................ 51 

Spain........................................................................................................................... 56 

Estonia........................................................................................................................ 63 

France......................................................................................................................... 66 

Italy ............................................................................................................................ 70 

Ireland ........................................................................................................................ 78 

Latvia.......................................................................................................................... 83 

Lithuania .................................................................................................................... 86 

Luxembourg ............................................................................................................... 89 

Hungary...................................................................................................................... 92 

Malta .......................................................................................................................... 95 

Netherlands ................................................................................................................ 97 

Austria ...................................................................................................................... 100 

Poland....................................................................................................................... 105 

Portugal .................................................................................................................... 109 

Slovakia.................................................................................................................... 112 

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22. 

23. 

24. 

25. 

Slovenia.................................................................................................................... 116 

Finland...................................................................................................................... 121 

Sweden ..................................................................................................................... 126 

United Kingdom....................................................................................................... 131 

Part 3: List of Major Projects ................................................................................................. 137 

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Part 1: General analysis of activities 

1. 

INTRODUCTION 

As required by Article 45(2) of Council Regulation (EC) No 1260/1999, this report 
sets  out  to  give  an  overview  of  the  implementation  of  the  Structural  Funds 
(2000-2006) in 2007.  

2007 was the eighth year in which Structural Funds programmes and projects for the 
2000-2006 programming period were implemented. Altogether, 226 Objective 1 and 
Objective  2,  47  Objective  3,  12  FIFG  (outside  Objective  1),  81  INTERREG, 
71 URBAN,  27  EQUAL,  73  LEADER+  and  122  Innovative  Action  programmes 
were managed in 2007. 

Even though no further commitments could be made in 2007, sums were disbursed in 
respect of 2000-2006 Structural Funds assistance. Implementation of the 2007 budget 
was excellent. In terms of payment appropriations, 99.9% of ERDF, 99.9% of ESF, 
100%  of  EAGGF  and  97.5%  of  FIFG  resources  were  used  (compared  to 
99.9% ERDF, 99.9% ESF, 99.9% EAGGF and 84.16% FIFG in 2006). 

Member  States  and  regions  with  programmes  of  high  execution  rates  were  able  to 
start  preparing  for  closure.  The  general  framework  for  the  closure  of  2000-2006 
Structural  Funds  assistance  was  set  out  in  Commission  Decision  C(2006)3424 
in 2006. 

In  addition  to  implementation  of  2000-2006  Structural  Funds  programmes  and 
projects and preparation for their closure, the Commission was also heavily involved 
in  planning  and  programming  the  2007-2013  period  in  2007.  Negotiations  were 
total  of  27  national  strategic  reference  frameworks  and 
concluded  on  a 
428 programmes (311 ERDF, 117 ESF).1 

Efforts  were  continued  to  improve  the  quality  of  programmes  and  projects 
co-financed by the Structural Funds, an objective which also covers reliable financial 
management  of  programmes.  Better  financial  management,  control  and  evaluation 
also made for good governance of co-funded programmes and projects. 

The partnership model, set up between the Commission and the national and regional 
authorities  in  the  Member  States  to  implement  the  programmes,  has  produced  very 
high  quality  results.  The  case  of  Ireland  is  a  good  example,  where  the  national 
government  decided  to  apply  the  same  partnership  structure  used  to  implement 
ERDF-financed programmes in the execution of national development funds. 

To demonstrate the added value of European cohesion policy, an ex post evaluation 
of Objectives 1 and 2 programmes for 2000-2006 was launched in 2007. This will be 
carried  out  by  way  of  12  phased  and  interlinked  evaluations,  which  will  be 

1 

See Communication on the results of negotiations on strategies and programmes for the programming 
period 2007-2013. 

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completed by the end of 2009. Preparatory work was also undertaken on the design 
of ex post evaluations of INTERREG and URBAN. 

through  network  activities  and  encouraging  dissemination 

As part of the “Regions for Economic Change” Initiative, the Commission has been 
active  in  highlighting  good  practice  projects  in  different  fields  of  economic 
to 
modernisation 
mainstream operational programmes. The key principles of spreading good practice 
and  linking  networks  to  the  mainstream  were  incorporated  into  the  texts  of  the 
INTERREG IVC and URBACT II programmes adopted in autumn 2007. Two major 
conferences were organised under this banner, namely, “Regional policy responses to 
demographic  challenges” 
in  January  2007,  and  “Fostering  competitiveness” 
in March 2007. The “RegioStar Awards for Innovative Projects” initiative launched 
in March 2007 was also a success, attracting applications from more than 70 regions. 

Two  conferences  took  place  in  2007  for  the  network  programmes,  ERIK+  and 
IANIS+,  which  were  designed  to  gather  and  transfer  experience  on  innovation 
in technology and the information society. 

October  2007  heralded  the  “European  week  of  regions  and  cities”  OPEN  DAYS, 
under the slogan  “Making  it  happen: regions deliver growth  and jobs”.  With  more 
than 5500 participants from 34 countries, this was the biggest event ever organised 
on European Cohesion Policy; it was held jointly with the Committee of the Regions 
and 212 regions and cities across the EU. 

On  28-29  June  2007,  Potsdam  hosted  the  conference  ”50th  Anniversary  of  the 
European  Social  Fund  —  Review  and  Prospects”.  This  was 
the  official 
50th anniversary event for the European Social Fund. It also marked the closing of a 
series  of  political  conferences  organised  by  the  Federal  Ministry  of  Labour  and 
Social  Affairs  under  the  German  EU  Presidency.  In  organising  this  high-level 
conference,  the  German  Presidency  acknowledged  the  importance  of  the  European 
Social Fund. Looking to the new programming period, which kicked off in 2007, the 
conference accentuated the opportunities, challenges and prospects for the ESF in an 
enlarged European Union. The Commission also produced a book tracing the history 
of  the  European  Social  Fund  in  the  context  of  Europe’s  economic  and  social 
development over the last 50 years. 

2. 

ANALYSIS OF IMPLEMENTATION 

2.1. 

Budget Implementation 

2.1.1.  ERDF 

In 
for 
terms  of  budgetary  execution,  2007  was  an  exceptional  year 
DG Regional Policy.  The  overall  execution  rate  of  ERDF  payment  appropriations 
reached  99.9%  (the  same  result  as  in  2006),  while  the  level  of  payment 
(EUR 21.4  billion  compared  with 
appropriations  was  higher 
EUR 16.0 billion in 2006). 

than  ever 

The  high  level  of  payment  appropriations  results  from  the  fact  that  in  2007  two 
programming  periods  were  managed:  further  interim  payments  for  the  2000-2006 
period and, for the first time, advance payments for programmes financed under the 

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2007-2013  financial  perspective.  The  vast  majority  (428  out  of  a  total  455)  of 
2007-2013  operational  programmes  (98%  in  value,  i.e.  operational  programmes 
worth a total of EUR 340 billion out of EUR 347 billion for the whole programming 
period) were adopted by the Commission before the end of 2007. 

For  Objectives  1  and  2  and  Community  Initiatives  for  the  period  2000-2006, 
DG REGIO  achieved  full  implementation  of  payment  appropriations.  To  do  so, 
a number  of  internal  transfers  from  Objective  2  to  Objective  1  had  to  be  made, 
following  the  suspension  of  certain  payments  to  the  UK  as  a  result  of  audits. 
Moreover, Objective 1 programmes made a higher demand on reimbursements than 
was  initially  forecast,  thereby  offsetting  advance  payments  to  new  programmes 
adopted in late December 2007 or postponed to 2008. 

At the end of 2007, outstanding commitments (RAL) from previous years on which 
payments  were  still 
to 
EUR 45.8 billion in 2006. 

totalled  EUR 28.0 billion,  compared 

to  be  made 

ERDF  total  commitments  relating  to  2007-2013  operational  programmes  amounted 
to EUR 27.2 billion (98.6%). The  remaining appropriations not  committed in 2007, 
due  to  delays  in  the  adoption  of  operational  programmes,  have  been  carried  over 
(total  of 
(EUR 117 million)  or 
EUR 495 million) . 

(EUR 378 million) 

reprogrammed 

to  2008 

Also in 2007, the “n+2” rule (committed Structural Funds must be invested, properly 
spent  and  accounted  within  two  years  of  the  year  of  commitment)  proved  to  be  an 
efficient tool for encouraging Member States to devote resources and effort to timely 
execution of European programmes. After analysing the exceptions granted under the 
“n+2”  rule  (State  aid,  major  projects,  etc.),  the  latest  internal  forecasts  of 
DG Regional  Policy  suggest  that  the  risk  of  possible  decommitments  should  not 
exceed 0.7% of 2005 commitments (around EUR 140 million).  

The pace of implementing the Structural Funds proves that Cohesion Policy works. 
Throughout  2007,  the  ERDF  absorption  rate  (payments  vs.  commitments)  for  all 
Member  States  reached  79%.  New  Member  States  achieved  record  absorption 
figures,  receiving  EUR 3 billion  in  2007,  nearly  as  much  as  they  were  reimbursed 
altogether in 2004, 2005 and 2006 (EUR 3.5 billion). This means that by the end of 
2007  the  new  Member States  have  achieved  average  consumption  of  71%  of  their 
financial allocations for the period 2004-2006, whereas the average ERDF absorption 
rate for the EU-15 (period 2000-2006) was 85%.  

2.1.2.  ESF 

The overall execution rate of ESF payment appropriations reached 99.9% (the same 
as  in  2006),  while  the  level  of  payment  appropriations  was  higher  than  last  year 
(EUR 11.3 billion compared with EUR 9.3 billion in 2006). 

2007-2013 programming period 

ESF total commitments relating to 2007-2013 operational programmes amounted to 
EUR 10.486 million (99.88%). The remaining appropriations (EUR 13 163 237) not 
committed  in  2007  concern  the  French  OP  “Martinique  Region”,  which  was 

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not expected to be adopted in 2007. These appropriations are carried over to 2008 for 
further consumption.  

The  cumulative  consumption  of  payment  appropriations  during  January-December 
amounted  to  EUR  1  513  million.  This  corresponds  to  99.87%  of  annual  payment 
appropriations  (EUR 1  515  million).  The  difference  (EUR  1  957  184.6)  consists  of 
the  advance  payment  for  the  French  OP  “Martinique  Region”  and  will  be  paid 
in 2008. 

2000-2006 programming period 

Application  of  the  “n+2”  rule  involved  12  programmes  at  the  end  of  2007  and 
EUR 92.2  million.  The  risk  of  possible  decommitments  should  not  exceed  0.8%  of 
2005 commitments.  

The  total  outstanding  commitments  at  the  end  of  2007  stood  at  EUR 12 billion 
(compared to EUR 22.9 billion in 2006). 

At  the  end  of  2007,  outstanding  commitments  from  previous  programming  periods 
(RAL)  totalled  EUR 179  million,  compared  with  EUR 204.6  million  at  the  end  of 
2006. 

2.1.3.  EAGGF 

The total amount paid in 2007 was EUR 3.4 billion. The financial execution rate of 
EAGGF  payment  appropriations  for  rural  development  programmes  for  the  period 
2000-2006 was 100.0%. 

As rural development operational programmes are not part of the Structural Funds in 
the  new  programming  period  2007-2013,  there  is  a  slight  decrease  in  the  overall 
amount paid out in 2007 compared with the previous year (i.e. EUR 3.6 billion). 

A  number  of  internal  transfers  had  to  be  made  to  achieve  full  financial  execution, 
mostly from the new European Agricultural Fund for Rural Development (EAFRD). 

In 2007, there are no commitments for rural development programmes relating to the 
2000-2006 period. 

At  the  end  of  2007,  outstanding  commitments  from  previous  years  (RAL)  totalled 
EUR 3.9 billion, compared with EUR 7.3 billion in 2006. 

The  first  estimates  as  regards  the  “n+2”  rule  (applying  at  the  end  of  2007  to 
commitments made in 2005 or before) show that the risk of possible decommitments 
concerning rural development funds is around EUR 70 million. 

2.1.4.  FIFG 

Budgetary  implementation  in  2007  was  highly  satisfactory,  97.5%  of  payment 
appropriations  being  executed.  The  payment  rate  reached  96.44%  in  Objective  1 
regions and 99.96% in regions outside Objective 1.  

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The  total  RAL  for  the  FIFG  at  the  end  of  the  year  2007  was  EUR  811  million 
(compared to EUR 1 336 million in 2006).  

As regards implementation of the “n+2 rule”, estimated decommitments are around 
EUR 54 million for 2007.  

2.2. 

Programme Implementation 

2.2.1.  Objective 1 

Expenditure  on  Objective  1  programmes  followed  much  the  same  path  as  in  2006 
(for  details,  see  part  5).  Objective  1  programmes  focused  on  basic  infrastructure 
projects (41.4%), with over half of all investment in this category spent on transport 
infrastructure  (53%).  More  than  a  third  (33.5%)  of  Objective 1  resources  were 
invested in the productive environment, where the focus continues to be on assisting 
SMEs and the craft sector (28.6%). Projects geared to human resources account for 
23.2% of resources in Objective 1 regions. The main areas of assistance in this field 
are  almost  equally  split  between  labour  market  policies  (31.3%)  and  education  and 
vocational training (31%).  

2.2.2.  Objective 2 

The  main  focus  of  programmes  in  Objective  2  regions  continues  to  be  on  the 
productive  environment,  with  over  half  of  all  financial  resources  devoted  to  this 
category  (55.8%).  Within  this  field,  assistance  to  SMEs  and  the  craft  sector  is  the 
most dominant (56.6%). The second most supported field is basic infrastructure, with 
39.6%  of  all  Objective  2  resources.  Unlike  Objective  1  programmes,  the  most 
important  areas  in  financial  terms  are  planning  and  rehabilitation  of  areas  (45.4%). 
In the category of human resources (10.1% of all investment in Objective 2 regions), 
workforce 
information  and 
communication technologies are the main fields of investment (30.8%).  

flexibility,  entrepreneurial  activity, 

innovation, 

2.2.3.  Objective 3 

The  main  emphasis  of  ESF  programme  implementation  in  2007  continued  to  be 
support  for  the  European  Employment  Strategy,  particularly  measures  aimed  at 
improving  employability  in  the  labour  market  (32%),  lifelong  learning  (27%)  and 
equal  opportunities  (6%).  There  was  still  a  marked  difference  in  concrete 
implementation  of  programmes,  as  measured  by  financial  execution,  between  the 
EU-15,  where  long-established  programmes  continued  to  be  implemented,  and  the 
EU-10,  where  some  Member  States  are  experiencing  considerable  difficulties  in 
getting certain projects and measures under way.  

2.2.4.  Fisheries outside Objective 1 

Implementation  of  the  structural  policy  in  the  fisheries  sector  improved  in  2007. 
This was reflected in the financial execution of FIFG operational programmes, which 
helped to achieve the objectives of the Common Fisheries Policy. 

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2.2.5.  Community Initiatives 

2.2.5.1.  Interreg 

INTERREG  supports  cross-border,  transnational  and  interregional  cooperation 
designed to encourage harmonious, balanced and sustainable development of the EU 
territory. By the end of 2007, the 81 INTERREG III / Neighbourhood Programmes 
had  selected  about  15  000  projects  and  networks  designed  to  reduce  the  effects  of 
national borders, language barriers and cultural differences, to develop border areas, 
and to support strategic development and territorial integration across larger zones of 
the  Union,  including  better  integration  with  its  neighbours.  The  effectiveness  of 
regional  development  policies  and  instruments  has  also  been  improved  through  the 
sharing of good practice and exchange of experience. 

The first 54 INTERREG III programmes were adopted in 2001 and were followed by 
15 programmes in 2002 and 3 in 2003. Enlargement increased the overall number of 
EU  borders  and  resulted  in  9  new  programmes  being  adopted  in  2004,  many  of 
which are Neighbourhood Programmes. In 2004, most programmes were amended to 
take  account  of  the  mid-term  evaluations  and  the  distribution  of  indexation  funds. 
Changes  were  also  necessary  for  some  programmes  due  to  enlargement  and/or 
integration  of  the  Neighbourhood  Programme  concept.  N+2  decommitments  and 
updates  of  the  mid-term  evaluations  made  for  further  programme  amendments  in 
subsequent years. 

By  the  end  of  2007,  the  payment  execution  rate  was  about  68%.  Due  to  the  more 
specific  and  challenging  nature  of  cooperation  programmes  and  projects, 
decommitments  under  the  “n+2”  rule  could  not  be  avoided  for  some  programmes. 
While  EUR  63  million  is  still  under  further  investigation,  up  to  EUR  18.5  million 
will  have  to  be  decommitted,  adding  to  the  EUR  113  million  already  decommitted 
between 2003 and 2006. 

Progress  continued  on  81  INTERREG  III/Neighbourhood  programmes  in  2007. 
The Commission  continued  its  active  follow-up  in  close  cooperation  with  the 
authorities responsible for programme implementation, which partly overlapped this 
year  with  the  start-up  and  early  implementation  of  the  2007-2013  cooperation 
programmes.  

As programmes were approaching the end of the programming period, limited funds 
were  available  for  new  projects,  and  fewer  monitoring  and  steering  committee 
meetings were organised compared with previous years. To make for more efficient 
spending of funds, and thus also prepare for programme closure, 65 amendments to 
programme complement were made. 

Programmes  have  been  closely  monitored  to  ensure  efficient  implementation,  in 
particular  as  regards  financial  management.  There  have  been  regular  contacts  with 
the  implementing  authorities,  including  on  dissemination  of  good  practice. 
In addition to this, the INTERACT support programme has continued to contribute to 
efficient and effective implementation of INTERREG III programmes by organising 
a  large  number  of  best  practice  events  and  producing  management  manuals  for 
cooperation. 

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2.2.5.2.  Equal 

In  2007,  good  progress  continued  to  be  made  on  27  programmes  and  more  than 
3 300  projects  under  Equal.  Around  30  meetings  of  Equal  monitoring  committees 
were  held  during  2007.  They  focused  on  strategies  and  action  to  mainstream  good 
practice that has been developed and validated. Administrative issues such as annual 
reports  and  transfers  of  appropriations  between  programme  priority  axes  were  also 
discussed  during  these  meetings.  Two  coordination  meetings  of  the  Equal 
managing authorities  took  place  in  Brussels  during  2007.  As  regards  financial 
implementation, six Member States were unable to use part (between 8% and 49%) 
of their 2005 budgetary commitment (“n+2” rule).  

including 

In an effort to maximise the results of the Equal programmes and projects, and thus 
steer  policy  and  practice, 
the  shape  of  national  and  regional 
ESF programmes for the programming period 2007-2013, the Commission continued 
to  work  in  partnership  with  the  Member  States  on  the  work  launched  in  2006. 
issues  such  as  asylum  seekers,  diversity  and 
This work  covered  policy 
empowerment,  youth  employment,  the  (re)-integration  of  ex-offenders,  social 
economy,  inclusive  business  creation,  and  media  and  diversity,  together  with 
management  principles  (partnership,  transnational  cooperation,  innovation  and 
gender  mainstreaming).  This  mainstreaming  work  concentrated  on  gathering  and 
validating  good  practice 
in  new  methods  of  delivery,  on  supporting  EU 
mainstreaming platforms for the lessons learnt and on disseminating information on 
the achievements of Equal through the Equal website and the Equal newsletter. 

The  work  of  the  EU  mainstreaming  platforms  was  completed  in  2007  by  closing 
conferences  bringing  together  decisions-makers,  representatives  of  Equal  and  ESF 
managing authorities, representatives of Equal Development Partnerships and major 
players in the respective fields. These conferences concentrated in particular on ways 
of taking  forward  the successful  approaches that have been pioneered under Equal. 
There  was  also  a  strong  will  to  continue,  within  the  context  of  the  new  ESF 
programming  period,  with  what  these  mainstreaming  platforms  had  so  successfully 
started, namely the creation of a stable and real link between people and projects on 
the ground and policy issues at EU and national level.  

To  help  shape  transnational  cooperation  in  the  new  ESF  programmes,  the 
Commission organised a seminar  at the beginning of 2007,  which  brought  together 
government  representatives  from  all  Member  States  in  charge  of  planning  and 
implementing  the  new  ESF  programmes.  The  Commission  took  on  board  the 
recommendations from this seminar to draft an action plan to facilitate transnational 
and  interregional  cooperation  in  the  ESF.  The  first  step  was  taken  at  a 
second seminar in the spring where Member States and regions agreed to establish a 
formal  network  of  contact  points.  A  kick-off  meeting  of  the  network  of  nominated 
contact  points  for  transnational  cooperation  was  held  in  September  2007  to  ensure 
that  effective  mechanisms  and  procedures  to  make  transnational  cooperation  work 
were put in place. Fifteen workshops on the Equal programme were organised during 
the European Week of Regions and Cities (“Open Days”) in October 2007.  

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2.2.5.3.  Urban  

Work  continued  in  2007  on  the  management  of  the  71  operational  programmes 
implementing  the  URBAN  Community  Initiative  by  way  of  annual  reports, 
monitoring  committees  and  annual  meetings.  Programmes  management  meant  not 
only the follow-up of financial implementation but also ensuring the continuity of the 
“URBAN”  methodology  and  approach.  There  was  active  follow-up  of  the 
URBACT I  programme,  including  the  launch  of  two  fast  track  pilot  networks. 
The URBACT  II  programme,  one  of  the  main  instruments  of  the  Regions  for 
Economic  Change  initiative,  was  approved  and  launched.  URBACT  has  developed 
20  networks  and  6 thematic  working  groups,  and  also  working  groups  bringing 
together  several  networks  around  a  particular  theme.  The  programme  is  in  its  final 
phase  of  closure.  A  specific  tool  was  created  for  the  URBACT  programme  to 
exchange  knowledge  on  integrated  urban  development  between  experienced  city 
experts  (city  managers,  project/programme  leaders,  external  consultants)  and  cities 
with limited experience in that field. The Support for Cities Initiative was conducted 
between September 2006 and June 2007, and involved 43 cities across eight Member 
States. 

authorities,  Member  States,  universities 

In three years, URBACT has become the framework for exchange and reflection on 
urban  issues  and  problems  not  only  for  decision-makers  in  cities,  but  also  for 
research  bodies. 
regional 
The programme 
disciplinary 
decompartmentalisation  between  cities  and  also  within  the  city.  In  the  mid-term 
evaluation  (12/2005),  URBACT  was  described  as  “a  highly  relevant  initiative  for 
Europe’s  cities”.  URBACT  is  already  a  useful  tool  for  mutual  learning  among 
policy-makers, technicians and others. 

territorial, 

promotes 

sectoral 

and 

and 

2.2.5.4.  Leader+ 

The Community Initiative Leader+ consists of three actions: implementation of local 
development  strategies  by  public  private  partnerships,  cooperation  between  rural 
territories and networking. 73 Leader+ programmes for the EU-15 were approved for 
the  period  2000-2006.  Recently  acceded  EU  Member  States  had  the  option  of 
integrating Leader+ type measures into their EAGGF Objective 1 programmes. 

Local development strategies  

2007 saw a significant acceleration in project commitment. A survey made at the end 
of 2007 showed a total number of 79 953 approved local projects. The average total 
budget for local ‘action 1’ projects is EUR 54 000. 

The  physical  indicators  for  some  programmes  clearly  show  the  success  of  the 
programmes already, e.g. 

–  18 500  jobs  created  in  4  Member  States  (Spain  12  042;  Finland  3  075; 

Ireland 2 500; Greece 862; Sweden 405);  

–  micro-enterprises created: Spain 2 717; Greece 1 794; Finland 539; England 500; 

–  43 000 people trained in Ireland; 26 732 in Finland; 12 824 in Sweden; 

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–  5 400 community services and facilities assisted or created in England. 

As  regards  management  of  the  programmes,  closure  dates  for  local  action  groups 
range between April and September 2008. 

Cooperation  

At  the  end  of  2007,  83.25%  of  the  894  local  action  groups  were  involved  in 
inter-territorial  cooperation  projects  and  68.51%  in  transnational  cooperation 
projects. This is a very positive result, bearing in mind the difficulty in drawing up 
concrete joint actions between different territories.  

The average total budget for cooperation projects is EUR 90 000 (for inter-territorial 
projects  the  average  is  EUR  95  000,  for  transnational  EUR  74  000).  The  most 
common  issues  covered  by  cooperation  projects  are  tourism,  agriculture  and  food, 
cultural heritage and knowledge management, education and training.  

A  European  database  of  approved  transnational  cooperation  projects  established  by 
the  Leader+  European  Observatory  lists  383  projects  (status  at  the  end  of  2007). 
This is  far  beyond  the  achievements  of  Leader  II  in  the  period  1994-1999 
(around 250 projects).  

Networking  

Most  of  the  Leader+  National  Networks  will  end  their  activities  in  2008.  In  some 
Member States, this closure date has been brought forward due to the start of the new 
national rural development networks funded by the European Agricultural Fund for 
Rural Development (EAFRD) for the period 2007-2013.  

Some national networks have organised final Leader+ events (Austria and Sweden). 
National  networks  are  working  on  the  legacy  of  Leader+.  In  the  Netherlands,  an 
evaluation  of  the  Network  Unit  showed  its  added  value  in  improving  cooperation 
between  government  administration  and  civil  parties  and  assisting  local  action 
groups.  

Dissemination and transfer of know-how is a core element of most National Network 
Unit  programmes:  an  important  area  of  action  relates  to  training  and  pedagogical 
actions on Leader and local development methods. 

The  European  Leader+  Observatory  identified  264  good  practices  in  collaboration 
with  national  networks.  A  first  publication  setting  out  twenty-one  examples  of 
good practice was issued in 2007. 

The Leader+ European Seminar in Borgo (Corsica) on 24-26 April 2007 focused on 
the 
from 
local  action  group  management.  300 
25 Member States, including 150 local action groups, participated in this event.  

representatives 

issue  of 

final  European  conference 

A  Leader+ 
in  Evora,  Portugal, 
on 22-23 November 2007: presentations were made of sixteen rural territories chosen 
from sixteen Member States. This event aimed to communicate clear messages about 
the legacy of the Leader initiative for the programming period 2007-2013, where the 
Leader method has been integrated into rural development programmes.  

took  place 

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2.2.6. 

Innovative Actions 

2.2.6.1.  ERDF 

DG Regional Policy also managed 122 Regional Programmes of Innovative Actions 
(of which 26 were closed in 2007), which help to promote strategic innovation in the 
regions,  by  experimenting  with  innovative  methods  and  practices  designed  to 
improve the level of innovation and the quality of EU assistance under three themes: 
knowledge  and  technological  innovation,  information  society  and  sustainable 
development. 

2.2.6.2.  ESF 

the  six  remaining  projects  from 

During  2007, 
the  call  for  proposals  on 
“Local Employment  Strategies  and  Innovation”  were  closed.  DG  Employment  also 
managed 80 transnational projects selected under the three rounds of the last call on 
“Innovative  approaches  to  the  management  of  change”  (22  closed  in  2007). 
Projects support the development and testing of innovative actions to anticipate and 
manage change in two priority areas: management of restructuring and management 
of demographic change. In addition, thirteen projects (of which five were closed in 
2007)  are  aimed  at  mainstreaming  the  results  of  previously  selected  projects  under 
the call on “Transfer and dissemination of innovation from ESF Article 6 projects”.  

2.2.6.3.  FIFG 

DG  Maritime  Affaires  and  Fisheries  managed  29  innovative  action  projects 
(of which the last two were closed in 2007). 

3. 

CONSISTENCY AND COORDINATION 

3.1. 

Consistency with other Community policies 

3.1.1.  Competition policy 

Article 9(5) of Council Regulation (EC) No 1083/20062 requires operations financed 
by the Funds to comply with the provisions of the Treaty and of acts adopted under 
it. Article 9(2) of that Regulation requires the Commission and the Member States to 
ensure that assistance from the Funds and the Member States is consistent with the 
activities, policies and priorities of the Community. 

Under  the  provisions  of  Regulation  1083/2006,  the  approach  to  the  control  of 
State aid  issues  in  the  new  Structural  Funds  is  fundamentally  different  to  the 
approach applied for the programming period 2000-2006.  

Under  the  current  legislative  framework,  full  responsibility  for  the  compliance  of 
Structural Funds operations with State aid rules lies with the Member State, and in 
particular, with the managing authorities.  

2 

Council  Regulation  (EC)  No  1083/2006  of  11  July  2006  laying  down  general  provisions  on  the 
European Regional Development Fund, the European Social Fund and the Cohesion Fund and repealing 
Regulation (EC) No 1260/1999; OJ L 210 of 31.7.2006; hereinafter: “Regulation 1083/2006”. 

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13 

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Article  60  of  the  Regulation,  for  example,  makes  the  managing  authorities 
responsible,  amongst  other  things,  for  ensuring  that  operations  comply  with 
applicable Community rules (thus Community State aid rules) and national rules for 
the whole of the implementation period.  

In addition, Articles 70 and 71 of Regulation 1083/2006 also require Member States 
to  ensure  that  the  relevant  control  mechanisms  are  put  in  place,  these  consisting, 
inter alia,  of  setting  up  certifying  and  audit  authorities/bodies  or  a  reporting 
obligation  to  allow  effective  ex-post  control  of  the  State  aid  responsibilities  of  the 
Member States. 

the  area  of  State  aid.  To 
themselves 

The OP provisions should explicitly reflect the new Member States’ responsibilities 
the 
in 
Operational Programmes 
following  clause: 
“The Managing Authority  is  responsible  for  ensuring  that  any  State  aid  under  the 
Programme  complies  with  the  procedural  and  material  State  aid  rules  applicable  at 
the point of time when the public support is granted”.  

the  decision  approving 

this  end, 
should 

include 

the 

Procedural  compliance  implies  an  obligation  on  the  part  of  the  Member  State  to 
notify the Commission of any plans to grant new aid and to await the Commission’s 
authorisation  before  the  measure  is  put  into  effect.  The  material  criteria  of  the 
compatibility of aid measures with EC rules are laid down by the Commission in the 
form of different “frameworks”, “guidelines” and “communications”.  

In 2007,  DG Competition  issued an  updated vademecum,  which  gives  an  overview 
of different procedural and material rules applicable to State aid and summarises the 
State  aid  legislation  that  is  considered  the  most  relevant  for  Structural  Funds 
Competition  website: 
operations. 
http://ec.europa.eu/comm/competition/state_aid/legislation/legislation.html.  

the  DG 

available 

on 

is 

It 

The  new  approach,  with  the  new  State  aid  responsibilities  of  the  Member  States, 
however, in no way affects the possibility of Commission action provided for by the 
procedural  Regulation  (EC)  No  659/1999,3  which  includes  the  examination  of 
allegedly  non-notified  (unlawful)  measures  and  the  recovery  of  incompatible 
non-notified aid co-financed by the Structural Funds. 

3.1.2. 

Internal market 

Regulation (EC) No 1083/2006 also requires Member States to verify that operations 
financed  by  the  Funds  comply  with  EU  Public  Procurement  Directives.  Where  the 
Commission learns of any breach of EC legislation or where audits demonstrate that 
this  is  the  case,  it  will  take  appropriate  action.  In  the  programming  context,  the 
Commission  requires  information  from  the  Member  States  in  the  form  of  annual 
reports  on  the  programmes.  The  Directorates-General  for  Regional  Policy  and  for 
Internal  Market  have  helped  to  clarify  the  legal  treatment  of  concessions  dating 
before  the  accession  of  new  Member  States,  on  1  May  2004,  that  were  not 
in compliance  with  the  EC  acquis.  A  new  regulatory  framework  for  public 

3 

Council Regulation (EC) No 659/1999 of 22 March 1999 laying down detailed rules for the application 
of Article 93 of the EC Treaty, OJ L 83, 27.3.1999. 

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procurement  law  and  the  awarding  of  concessions  has  been  introduced  in  order  to 
provide greater legal certainty both for the private and for the public sector. 

3.1.3.  Environment 

the 

the 

context  of 

adoption  of  Cohesion  Policy  NSRFs 

and 
In 
operational programmes  for  2007-2013,  the  priorities  are  correct  application  of  the 
Strategic  Environmental  Assessment 
(SEA)  Directive,  providing  adequate 
investment  for  implementing  the  environmental  acquis,  addressing  new  challenges 
such  as  climate  change  and  sustainable  energy,  and  continuing  to  mainstream 
sustainable development as a horizontal principle. 

in 

The focus with ongoing programmes continues to be on supporting compliance with 
the  Community  acquis 
the  field  of  urban  wastewater,  water  supply, 
waste management  and  biodiversity.  Other  important  areas  of  investment  are  in 
soil.  The  promotion  of 
eco-innovation 
in 
continued 
sustainable development 
environmentally-friendly transport and energy by introducing environmental criteria 
into  project  selection,  and  by  pro-actively  ensuring  compliance  of  projects  with 
environmental legislation. 

rehabilitation  of  polluted 

investments 

through 

and 

has 

3.1.4.  Transport 

Cohesion  programmes  continue  to  be  the  main  source  of  Community  support  in 
transport,  as  introduced  in  the  White  Paper  “European  transport  policy  for  2010: 
time to decide” and the mid-term review published in 2006. Accordingly, Funds have 
in  projects  supporting co-modality, 
been  used  both 
and  urban 
systems 
energy efficiency 
transport mobility. 

in TEN-T  projects  and 
in 

intelligent 

transport, 

transport 

3.1.5.  Gender equality 

The  Commission  has  worked  to  implement  the  “Roadmap  for  Equality  between 
Women  and  Men”,  reflecting  the  Commission’s  commitment  to  this  issue.  In  this 
context, gender equality and gender mainstreaming are cross-cutting issues linked to 
all  programmes  in  the  new  Cohesion  Policy  Period  2007-2013.  A  meeting  of  the 
High  Level  Group  on  Gender  Mainstreaming  in  the  Structural  Funds  in  June  2007 
underlined 
the  design  and 
importance  of 
implementation of programmes. 

involving  gender  bodies 

the 

in 

3.2. 

Coordination of instruments 

3.2.1.  The Structural Funds and the Cohesion Fund 

in 

the 

fields  of 

Aid  granted  by  the  Cohesion  Fund  provides  financing  for  transport  infrastructure 
projects 
the  environment. 
The Cohesion Fund  enables  the  beneficiary  Member  States  to  channel  significant 
public  investment  into  these  two  fields  of  common  interest,  while  meeting  the 
objectives  of  reducing  the  budget  deficits  set  out  in  the  convergence  and  stability 
programmes drawn up as part of Economic and Monetary Union. 

trans-European  networks  and 

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Following  the  enlargement  of  the  European  Union  in  May  2004,  the  ten  new 
Member States are covered by the Cohesion Fund. In the period 2000-2006, before 
the  latest  enlargement  on  1  January  2007  to  include  Romania  and  Bulgaria,  there 
were 13 beneficiary Member States. As a result of its economic growth, Ireland has 
not been eligible for the Fund since 1 January 2004. 

The principal instrument for coordinating funding under the Cohesion Fund and the 
Structural Funds is the strategic reference framework (SRF), which covers the whole 
of the 2000-2006 period. Council Regulation (EC) No 1265/1999 amending Annex II 
to Regulation (EC) No 1164/94 provides that “Member States shall also provide the 
results  of 
conformity  with 
Community legislation,  and  their  consistency  with  a  general  environmental  or 
transport strategy at administrative unit or sector level”.  

environmental 

assessment 

impact 

the 

in 

The  four  “old”  Member  States  benefiting  from  the  Cohesion  Fund  presented  their 
SRFs  for  the  environment  and  transport  sectors  at  the  end  of  2000.  The  ten  new 
Member States submitted theirs during the first half of 2004. Since then, decisions to 
finance projects by the Cohesion Fund have been subject to a verification process to 
avoid duplication with programmes adopted under the Structural Funds. In addition, 
SRFs improve the complementarity between the two instruments.  

Thus, in certain cases, these SRFs form an integral part of the programmes approved 
under  the  Structural  Funds  for  the  period  2000-2006;  this  improves  coordination 
between funding under the Cohesion Fund and the Structural Funds. 

3.2.2.  The Structural Funds and the EIB/EIF 

Jessica — Joint European Support for Sustainable Investment in City Areas 

With  its  focus  on  promoting  sustainable  investment,  growth  and  jobs  in  Europe’s 
urban  areas,  the  JESSICA  initiative  is  positioned  at  the  core  of  the  renewed 
Lisbon agenda. 

It  introduces  a  cultural  shift  in  how  Structural  Funds  support  is  delivered, 
encouraging  recyclable  forms  of  assistance  and  moving  away  from  the  exclusive 
reliance on grants. 

JESSICA  allows  managing  authorities  to  use  some  of  their  Structural  Funds 
allocations  to  invest  in  Urban  Development  Funds  and  thus  to  recycle  financial 
resources in an effort to enhance and accelerate investment in urban areas. 

A “Preliminary Evaluation Study” carried out by the EIB and the Commission on a 
sample of representative “old” and “new” Member States provided a first estimate of 
the  potential  demand  and  an  overview  of  existing  structures  for  urban  investments 
under JESSICA. 

In  a  bid  to  highlight  the  advantages  of  increasing  the  use  of  financial  engineering 
instruments  in  the  context  of  cohesion  policy  and  to  raise  awareness  regarding  the 
possibilities offered by JESSICA, kick-off meetings with representatives of the EIB 
and the Commission have been organised. 

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16 

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Up  the  end  of  2007,  these  kick-off  meetings  had  already  taken  place  in  sixteen 
Member States.  Meetings  should  be  organised  as  soon  as  possible  in  the  remaining 
Member States. 

The EIB will carry out detailed JESSICA evaluations for Member States or regions 
genuinely  interested  in  this  initiative.  The  results  will  be  made  freely  available  to 
Member  States,  to  help  them  organise  urban  investments  funded  by  the  ERDF  and 
the private and banking sectors under the JESSICA initiative. 

JASPERS 

In 2005, the Commission agreed in principle with the EIB and the EBRD to step up 
cooperation,  especially  with  the  Member  States  that  joined  the  EU  in  2004  and 
Romania  and  Bulgaria.  Because  of  the  relative  lack  of  experience  of  the  national 
administrations  with  project  preparation,  it  was  agreed  to  establish  a  new  joint 
structure 
in 
(Joint  Assistance 
European Regions)  to  assist  those  twelve  Member  States  with  the  preparation  of 
major  projects.  JASPERS  headquarters  is  at  the  EIB  in  Luxembourg,  but  it  was 
agreed  to  base  the  majority  of  the  new  expert  staff  to  be  recruited  close  to  the 
beneficiaries in regional offices in Warsaw, Vienna and Bucharest.  

to  Support  Projects 

JASPERS 

called 

The new facility came into operation in 2006, drawing on the core staff provided by 
the EIB and the EBRD (target input: 16 and 5 staff years respectively). Following an 
intense  period  of  recruitment  of  new  staff  and  finalising  legal  agreements  in  2006, 
JASPERS  expanded  rapidly  during  2007  with  the  first  of  the  new  expert  staff 
arriving in January, building up to close to target size by mid-year.  

Action  plans  (work  programmes)  for  2007  were  agreed  with  all  twelve  of  the 
beneficiary  countries  by  mid-year.  The  JASPERS  regional  office  in  Warsaw  was 
formally opened in January, followed by the Vienna office in May and the Bucharest 
office in June. 

By  the  end  of  the  year,  JASPERS  had  staff  of  54  experts  and  a  portfolio  of 
266 projects and horizontal studies; 21 assignments were completed during the year. 

JEREMIE 

The new JEREMIE initiative to improve access to finance for SMEs in the regions 
was launched jointly by the Commission and the EIB group in 2006. It made a very 
successful  entry,  in  2007,  in  the  lives  of  the  regions,  the  managing  authorities,  and 
the  business  and  banking  sector.  JEREMIE  is  now  part  of  the  new  generation  of 
operational programmes approved in 2007, and has already been launched in several 
Member States and regions. 

In  2007,  Greece  was  the  first  Member  State  to  sign  a  funding  agreement  with  the 
EIF,  the  JEREMIE  holding  fund  tasks  being  assigned  by  way  of  a  grant.  Hungary 
opted to implement JEREMIE, signing a funding agreement in 2007 with a national 
financial  institution,  designated  by  national  law,  which  is  assigned  the  JEREMIE 
holding fund tasks. By the end of 2007, JEREMIE actions were scheduled in more 
than 85 operational programmes approved by the Commission for the programming 
period  2007-2013.  Overall,  about  twenty  Member  States  have  already  made  clear 

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their  intentions  to  implement  JEREMIE,  while  the  other  Member  States  were 
examining ways of joining the initiative at a later stage.  

The  EIF  is  certainly  a  key  player  in  implementing  JEREMIE.  About  fifteen 
Member States are expected to implement JEREMIE, working jointly with the EIF, 
the  latter  acting  as  a  holding  fund,  either  at  national  or  at  regional  level. 
The Commission  finances  85%  of  the  cost  of  gap  analyses  offered  to  regions  and 
Member  States,  while  the  EIF  co-finances  the  other  15%.  A  total  of  36  JEREMIE 
gap analyses, identifying gaps between supply and demand for access to finance by 
SMEs in Member States or regions, were completed by the EIF in 2007. 

DG  REGIO  and  the  EIF  jointly  carried  out  a  wide-scale  information  campaign  in 
2007 to promote and explain JEREMIE to Member States and regions, to SMEs in 
the  regions  and  to  European  enterprise  and  industry  associations  such  as 
Euro-business, Euro-chambers, Eurada, etc. Several JEREMIE events and workshops 
involving  regions  and  SMEs  took  place  in  October  in  the  context  of  the 
2007 OPEN DAYS. 

Resources from about 85 ERDF operational programmes that envisage the possibility 
to  implementing  the  JEREMIE  facility  in  the  period  2007-2013  are  put  at  around 
EUR 2.5 billion. The total public and private resources expected to be invested under 
JEREMIE  to  enhance  SMEs’  access  to  finance  in  the  regions  could  reach 
EUR 15 billion for the period 2007-2013. This would be a considerable improvement 
on  the  estimated  EUR  3  billion  invested  in  the  same  objective  by  ERDF 
operational programmes for the period 2000-2006.  

its  Communication  on 

Building  on 
(2006), 
on 23 November 2007, the Commission adopted an initiative for the development of 
micro-credit  in  Europe  in  the form  of  a  Commission  Communication  to  the 
Institutions.  This  communication was  drafted  with  the  aim  of  developing  a 
sustainable  micro-credit  market  with  the  JEREMIE  instrument  and  contributing  to 
the growth and jobs objective of the Lisbon agenda.  

financing  SME  growth 

This micro-credit initiative of the Commission’s addresses existing instruments and 
highlights strands where there is room for improvement, i.e. 

–  improving the legal and institutional environment in the Member States;  

–  changing the climate in favour of entrepreneurship;  

–  promoting the spread of best practices; and  

–  providing additional financial capital for micro-finance institutions (MFIs).  

that 

is  potential  demand 

The  Commission  estimates 
for  over 
there 
700 000 micro-loans in Europe, amounting to some EUR 6 300 million, which is not 
reasons 
given  adequate  consideration  by 
(high administrative  costs  compared  to  the  size  of  the  loan,  absence  of  collateral, 
etc). To fill this gap, the Commission seeks to help the emergence of new non-bank 
micro-finance  institutions  (MFIs) and  thus  to develop  a  layer  of  reliable  and 
sustainable 
to 
micro-borrowers. 

turn, will  disburse loans 

intermediaries, which, 

traditional  banks 

for  various 

financial 

in 

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As part of this initiative, the Commission will channel technical assistance resources 
from  Cohesion  Policy  into  develop  mentoring  services  for  MFIs  and  provide 
technical support and accompanying measures in addition.  

A  micro-fund  to  increase  the  provision  of  repayable  capital  for  non-bank  MFIs is 
being  established  by  the  EIB  in  the  pilot  phase  of  the  Commission  initiative. 
It will be  managed  by  the  EIF.  The  critical  mass  of  this  micro-fund  will  be  some 
EUR 40 million, to which the EIB Group will contribute substantially. 

4. 

EVALUATIONS 

the  Commission  continued 
In  2007, 
decision-making under cohesion policy.  

to  carry  out  evaluations 

to  support 

ERDF 

Three strategic evaluations, published in 2006, have contributed to the quality of the 
programmes  agreed  during  2007  for  the  2007-2013  period.  In  addition  to 
country-level recommendations, the evaluations concluded the following: 

–  The  Strategic  Evaluation  on  the  Environment  and  Risk  Prevention  came  to  the 
conclusion  that,  without  Structural  Funds  assistance  over  the  2007-2013  period, 
the  time  needed  for  the  Member  States  to  achieve  compliance  with  the 
environmental  acquis  would  be  extended  by  a  factor  of  four,  posing  serious 
regional disadvantages. 

–  The  Strategic  Evaluation  on  Transport  Investment  Priorities  highlighted  the 
importance of Structural Funds assistance in addressing missing links in existing 
networks and the potential to generate spillover effects. 

–  The  Strategic  Evaluation  on  Innovation  and  the  Knowledge-based  Economy 
technological 

confirmed 
development and innovation (RTDI), compared to the 2000-2006 period. 

the  need  for 

in  research, 

investment 

increased 

Other evaluations completed in 2007 were as follows: 

–  An analysis of the impact of cohesion policy, providing estimates for a number of 
economic  variables,  including  economic  growth,  employment,  capital  formation, 
structural change and trade effects. 

–  Development of evaluation capacity in the EU Member States, a study resulting in 
an  analytical  framework  that  addresses  multiple  aspects  of  evaluation  capacity 
development. This framework can be a used either as a means of monitoring and 
comparing evaluation capacity development across the EU, or as a self-assessment 
or diagnostic tool by any individual Member State. 

–  A study on the economic impact of convergence, aiming to quantify the economic 
impacts of convergence assistance in a number of selected countries for the period 
2007-2013.  The  study  came  to  the  conclusion  that  Structural  Funds  will  have 
positive impacts in all the recipient countries, real GDP increasing by 15% more 
in  some  countries. 
than 

the  business-as-usual 

the  year  2020 

level  by 

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These positive  impacts  will  continue  even  after  the  end  of  the  financial  period 
2007-2013, thanks to TFP increased growth, higher labour productivity, and more 
accumulated human capital and better infrastructure. 

In 2007, the Commission launched the ex post evaluation of Objectives 1 and 2 for 
the  2000-2006  period,  a  total  of  12  interlinked  phased  “work  packages”  to  explore 
different  aspects  of  the  effectiveness  and  efficiency  of  cohesion  policy.  The  first 
interim results of the study will be used during the forthcoming policy review of the 
EU budget in 2008/2009 and in the discussion of the future of cohesion policy.  

Another important task of the Commission is to provide methodological guidance to 
the Member States and organise exchanges of experience. To this end, EVALSED, 
the  evaluation  of  socio-economic 
the  online  and 
development, is currently being updated. 

interactive  resource  for 

ESF  

To assess the actual results and impacts of assistance, new monitoring systems and 
evaluation arrangements have been set up at national level under the guidance of the 
Commission. One of the major positive changes in this programming period are the 
more  stringent  evaluation  requirements,  which  place  the  focus  on  up-to-date 
information on what the ESF does and what it achieves in terms of socio-economic 
change.  The  adoption  of  fewer,  more  useful  and  objective-focused  indicators  was 
secured through extensive negotiations.  

Following  the  successful  adoption  of  NSRFs  and  OPs  for  the  2007-2013  period, 
a summary  overview  of  all  Operational  Programmes  was  commissioned  by  the 
Evaluation  Unit  and  will  be  available  by  mid-2008.  Preparation  for  the  new 
programming period also included the planning of future strategic evaluations (to be 
launched by DG EMPL) on the contribution of the ESF to different policy areas. 

In 2007, the Commission continued to manage the implementation of the 2000-2006 
programmes. A number of thematic evaluation activities were completed:  

(a) 

(b) 

(c) 

ESF monitoring and evaluation systems in the Member States,  

ESF support for management of the anticipated economic change and 
restructuring,  

ESF contribution to employment and other policies by way of support 
for systems, structures and accompanying measures.  

The  main  objective  of  these  evaluations  was  to  draw  lessons  for  the  new 
programming period. 

Evaluation of the EQUAL Community Initiative continued throughout 2007, the aim 
being to identify as many successful innovative practices as possible (on combating 
discrimination  and  promoting  equality  for  vulnerable  groups),  for  subsequent 
mainstreaming into ESF-funded programmes. 

2007 was also a year of preparation for the ex post evaluation of the 2000-2006 ESF 
programmes.  More  specifically,  two  preparatory  studies,  which  were  needed  to 

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collect essential information for the main ex post exercises, were carefully planned in 
2007, one of them, on data availability, being launched in 2007.  

5. 

CONTROLS 

5.1. 

ERDF 

Closure of programme period 1994-1999 

Closure audits have been completed on a sample of 56 mainstream programmes and 
one  INTERREG  programme,  covering  all  EU-15  Member  States.  The  programmes 
audited give a 20-60% coverage of the ERDF contribution in all Member States, with 
one exception, and overall coverage of 35% of the ERDF contribution to mainstream 
programmes  (31%  of  the  total  ERDF  allocation).  At  the  end  of  2007,  18  enquiries 
had  been  closed  and  corrections  totalling  EUR  23.9  million  had  been  applied 
(including a formal Commission decision of EUR 9.6 million). Final position letters 
have  already  been  sent  or  hearings  set  for  25  programmes.  For  the  remaining 
fourteen cases, the final position letters are being prepared, the aim being to complete 
all financial correction procedures in 2008. 

Programme period 2000-2006 

For  the  ERDF,  an  audit  enquiry  was  started  in  mid-2004  to  examine  the  effective 
functioning  of  key  elements  of  the  management  and  control  systems  in  the 
Member States  for  mainstream  programmes.  The  audits  comprise  two  phases,  a 
systems review and an audit of a representative sample of projects. The on-the-spot 
audit work initially planned was concluded by the end of 2006 for the EU-15 and by 
the end of 2007 for the EU-10. Additional audits were carried out on 25 programmes 
in 2007, to extend coverage or address specific risks where identified by audits, or to 
follow up on the implementation of action plans. 

At the end of 2007, 214 audit missions (of which 13 INTERREG) had been carried 
out  and  95  programmes  had  been  audited.  The  programmes  audited  cover  41%  of 
mainstream programmes and 61% of the planned ERDF contribution. 

Based on the audit work performed, the main general risk identified continues to be 
insufficient management control by the management authorities and/or intermediate 
bodies, which is not  offset  by  an effective certification function. The main specific 
risk  is  in  the  area  of  public  procurement,  where  problem  issues  concern  failure  to 
observe  the  transparency  principle,  irregular  complementary  works,  application  of 
illegal  selection  criteria  and  tender  evaluation.  One  of  the  main  reasons  for  the 
deficiencies  in  EU-10  Member  States  is  that  staffing  is  still  a  persistent  problem. 
Problems recruiting and retaining sufficiently qualified staff make for an ineffectual 
control environment. 

In 2007, DG Regional Policy launched a new audit enquiry to check the reliability of 
the  audit  work  of  the  winding-up  body.  The  objective  is  to  draw  conclusions  as  to 
whether the audit work of the national bodies can be relied on as a main source of 
assurance for the remainder of the programming period and whether the winding-up 
declaration  will  be  based  on  adequate  audit  work  and  be  a  reliable  source  of 

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assurance at programme closure. Thirteen audits were carried out under this enquiry 
during 2007. 

As  regards  INTERREG,  DG  Regional  Policy  launched  a  separate  audit  enquiry  in 
2006,  which  it  continued  in  2007.  The  particular  challenge  is  that  for  most  of  the 
81 INTERREG  III  programmes  the  management  and  control  systems  are  different. 
Programmes  to  be  audited  have  been  selected  on  a  risk  basis,  in  the  same  way  as 
mainstream programmes. This has been supplemented by an analysis of the results of 
a “self-assessment exercise” conducted by the national bodies using a questionnaire 
prepared  by  the  Directorate-General,  and  by  a  detailed  assessment  of  the  annual 
control 
to  help  draw  conclusions  on  non-audited  programmes. 
Three additional programmes were audited in 2007, bringing the overall coverage to 
35% of ERDF commitments. Also, one of the programmes was subject to a project 
audit and 2 follow-up audits were carried out. 

reports 

Other audit work for the programming period 2000-2006 included the examination of 
the annual control reports received (132 in total) under Article 13 of Regulation (EC) 
No 438/2001 and the review of national system audit reports (231 in total). 

By the end of 2007, 10 annual bilateral meetings with national audit bodies had taken 
place, at which updates on audit work, progress on sample checks and follow-up of 
findings were reported. The other meetings were concluded by early February 2008. 

To help bring about further improvements, reduce the level of errors and show that 
the  structural  actions  budget  is  being  effectively  managed,  in  February  2008  the 
Commission  adopted  a  “Communication  on  an  action  plan  to  strengthen  the 
Commission’s  supervisory  role  under  shared  management  of  structural  actions” 
(COM(2008) 97 final). The action plan includes specific outputs and deadlines and 
focuses  on  correcting  system  deficiencies 
the 
Structural Funds  DGs’  audit  strategy,  improving  financial  correction  mechanisms, 
preparing for closure, finalising actions under the Commission Action Plan towards 
an  Integrated  Internal  Control  Framework  and  taking  preventive  measures  for  the 
programme  period  2007 2013.  The  Commission  has  committed  itself  to  providing 
the  European Parliament  with  quarterly  reports  on 
the 
Action Plan.  

implementation  of 

implementation  of 

through 

5.2. 

ESF 

Main outputs achieved in 2007 

95 audit missions were organised by DG EMPL in 2007. These involved audits of (a) 
unaudited  (in  part,  or  in  full)  operational  programmes  identified  in  the  2007 
risk analysis and (b) follow-up missions on the implementation of recommendations 
issued  by  the  ESF  audit  unit  or  on  the  results  of  audits  undertaken  by  the 
European Court of Auditors (ECA). The subjects of these 95 audit missions can be 
broken down as follows: 

–  9 missions relating to the closure of the 1994-1999 programming period; 

–  finalisation  of  audit  work  on  1994-1999  closures  carried  out  in  late  2006  in 
Germany and Ireland, the organisation of four wrap-up meetings for these specific 
audits.  Four  closure  audits  1994-1999  were  carried  out  in  three  Member  States 

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22 

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(France, Italy (2) and Spain). A follow-up mission on the ECA’s closure audit in 
Sweden was undertaken. The closure audit in Belgium will be carried out in 2008; 

–  86 missions relating to the audit of the management and control systems in place 

for the 2000-2006 programming period;  

–  10  audit  missions  of  unaudited  EU-15  operational  programmes  (or  parts  of 

operational programmes, mainly decentralised systems); 

–  4 missions to the EU-10 in preparation for the 2000-2006 closure;  

–  54  audits  on  substantive  testing  of  operations  (sample  checks,  including  desk 
review  and  on-the-spot  visits).  Of  these  54  audits,  20  related  to  programmes 
implemented in the EU-10 and 34 in the EU-15; 

–  18 follow-up missions, of which 5 in the EU-10 and 13 in the EU-15. 

Problems identified throughout the audits in the EU-25 in 2007 were: inadequate first 
level  checks,  insufficient  certification  procedures,  breaks  in  the  audit  trail, 
insufficient  separation  of  duties,  deficiencies  in  performing  5%  checks  and  issues 
related to the IT systems used in the management and control of the ESF. Four early 
warning  letters  were  issued  by  DG  EMPL/I.3  in  2007.  The  Member  States  and 
regions 
Germany/Hamburg, 
United Kingdom/Scotland and Luxembourg.  

France/Guadeloupe, 

concerned 

are: 

From the findings of the Commission, Member State and Court of Auditors audits, 
results were available for 225 out of a total of 239 OPs (94.1%) at the end of 2007.  

The  cumulative  coverage  (in  amounts)  of  the  2000-2006  programming  period, 
including additional coverage by national audits, reached 98.9%.  

Substantive testing of (groups of) programmes was carried out in 2007, 433 projects 
being covered by desk reviews and 270 by on-the-spot visits. This will be continued 
in  2008.  The  main  objective  of  these  audits  is  to  confirm  the  level  of  assurance 
obtained  by  the  ESF  audit  unit  through  the  systems  audits.  Some  520  projects  are 
scheduled to be audited in the course of 20 audits in 2008. 

Preparatory work for the 2007-2013 programming period 

Compliance  Assessment  and  Audit  Strategy:  the  ESF  audit  unit  has  prepared  for  a 
major  challenge  in  2008,  namely,  to  analyse  and  report  to  the  Member  States  on 
approximately 117 compliance assessments and 117 audit strategies. The procedural 
framework,  checklists,  standard  notes,  etc.,  were  developed  in  cooperation  with 
DG REGIO. A monitoring tool was developed within the ESF audit unit to screen the 
timing of each compliance assessment received. 

DG  EMPL  channelled  considerable  human  resources  into  the  development  of 
guidance  notes  and  explanatory  documents  for  the  Member  States  for  the  new 
programming period 2007-2013. 22 training seminars were organised and delivered 
for  the  Member  States’  Audit  Authorities,  mainly  during  the  second  half  of  2007. 
The  topics  discussed  related  to  various  issues  such  as  statistical  sampling,  risk 
analysis, role of the audit authority, compliance assessment, audit strategy, reliance 

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23 

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on the work of other auditors, etc. Following these seminars, the ESF audit unit, in 
cooperation with DG REGIO, provided assistance to the Member States in the form 
of a “Frequently Asked Questions” brochure. 

The ESF audit unit has also been heavily involved in the process of developing and 
issuing guidelines to the Member States. The guidelines developed are:  

–  Guidelines for Compliance Assessment of the management and control systems; 

–  Guidelines  for  the  Audit  Strategy  applicable  to  the  delivery  of  operational 

programmes; 

–  Guidelines and development of key requirements for the management and control 

systems; 

–  Guidelines  on  the  use  and  implementation  of  the  flat  rate  for  overheads 

(DG EMPL only); 

–  Guidelines on statistical sampling;  

–  Guidelines on annual summaries; and 

–  Guidelines on financial corrections for public procurement irregularities. 

Lastly,  the  ESF  audit  unit  participated  in  a  fact-finding  mission  to  Poland. 
This mission  was  organised  at  the  request  of  the  geographical  desk,  with  the 
objective  of  monitoring  implementation  of  the  IT  system  (SIMIK  2)  developed  for 
the 2007-2013 programming period. 

Annual summaries 

The  Commission  has  completed  its  first  assessment  of  the  annual  summaries 
submitted and has sent letters to most Member States. The letters already sent cover 
all cases of serious non-compliance. Where necessary, Member States that have not 
completely  followed  the  recommendations  in  the  Commission’s  guidance  note  are 
requested to provide revised annual summaries. Since these points do not constitute a 
formal legal requirement, the Commission cannot take any further action, but it will 
continue to encourage Member States to adopt best practices. 

The  majority  of  the  Member  States  have  complied,  or  mainly  complied,  with  the 
minimum  requirements  regarding  the  information  to  be  provided,  as  set  out  in  the 
guidance  note.  The  formal  submission  of  this  information  by  the  Member  States 
increases  the  accountability  of  the  Member  States  as  regards  use  of  the  Funds  and 
contributes  to  the  Commission’s  assurance.  However,  only  a  limited  number  of 
Member States followed the Commission recommendations to maximise the value of 
the annual summaries. In addition, in cases where an overall analysis was made or an 
opinion given, the quality could still be further improved. This can be explained, at 
least partially, by the fact that this was the first year of application of the requirement 
and  that  many  Member  States  decided  only  a  few  weeks  before  the  deadline  to 
provide  information  on  the  2000-2006  period.  Overall,  the  results  provide  a  good 
basis  for  encouraging  Member  States  to  present  annual  summaries  next  year  of 

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24 

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generally better quality, which will make a more significant contribution to assurance 
for structural actions. 

5.3. 

EAGGF 

DG  AGRI  adopted  the  same  basic  approach  as  DG  REGIO  and  shared  the  same 
general objectives. 

As  regards  the  1994-1999  period,  the  ex  post  audit  programme  had  already  been 
completed  in  2006.  A  number  of  financial  correction  procedures  are  under  way: 
bilateral  meetings  held  with  the  Member  States  in  2007  covered  2  programmes. 
Four financial  correction  decisions  covering  12  programmes  were  adopted  by  the 
Commission during the year. 

For  the  period  2000-2006  (EU-25),  19  programmes  covering  18%  of  planned 
expenditure  were  audited  in  2007.  By  the  end  of  the  year,  a  total  of  87  out  of  the 
152 approved  EAGGF-Guidance  programmes  had  been  audited.  The  programmes 
audited  cover  92%  of  the  planned  EAGGF  contribution  and  57%  of  the  number  of 
programmes.  Typical  problems  identified  were:  inadequate  management  controls, 
failure  to  verify  eligibility  criteria  against  the  provisions  of  agricultural  legislation 
and a low level of independent controls. These findings are being followed up with 
the  Member  States  concerned  and  may  lead  to  financial  corrections.  A  number  of 
financial  correction  procedures  are  under  way.  One  financial  correction  decision 
covering one programme was adopted by the Commission during the year. 

5.4. 

FIFG 

Closure of the programme period 1994-1999 

By the end of 2007, 43 out of 52 programmes had been closed, one is in the process 
of  being  closed,  and  six  will  be  subject  to  a  financial  correction  procedure  by  the 
Commission under Article 24 of Regulation 4253/1988. The closure proposal letter is 
being prepared for the last two programmes . The percentage of programmes closed 
or in the process of being closed covers 84.6% of the total. 

Outstanding  commitments  (RAL)  on  programmes  not  yet  closed  amount  to 
EUR 36.5 million, which is EUR 5.8 million less than in 2006. This is 1.3% of the 
total amount allocated to FIFG programmes for the period. The financial corrections 
requested by DG MARE during the closure exercise amount to EUR 113.1 million, 
i.e.  4%  of  the  total  amount  allocated  to  FIFG  programmes.  Of  this  total, 
EUR 38.9 million was accepted by the Member States, which was covered either by 
reduced payments or by recovery orders.  

The  amount  still  under  discussion,  which  may  be  subject  to  financial  correction 
procedures by Commission Decision, comes to EUR 83 million,4 which is 2.66% of 
the total amount allocated to FIFG programmes. 

table  below  shows 

The 
31 December 2007. 

the  situation  regarding  closure  procedures  as  at 

4 

Including a correction of EUR 9 million for the Spadare measure. 

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25 

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31/12/2007 

No of OPs 

FIFG Budget 

Corrections 

Programmes closed 

Programmes not yet 
closed  

Programmes for 
which final 
proposal to be made 

TOTAL 

43 

7 

2 

52 

Programme period 2000-2006 

1 409 211 498 

38 889 317 

1 301 159 775 

74 251 021 

72 462 000 

n.a. 

2 782 833 273 

113 140 338 

The ex post control sector carried out a total of ten on-the-spot controls in the course 
of 2007 for the FIFG.  

The  ten  FIFG  audits  carried  out  in  2007,  covering  twelve  operational  programmes, 
focused on the verification and follow-up of the effective functioning of management 
and control systems for the period 2000-2006. The audits tested key controls in place 
in the management and control systems, combined with sample checks of projects by 
desk review and on-the-spot visits to projects and beneficiaries. These audits indicate 
that,  of  the  programmes/systems  audited  by  the  DG  in  2007,  two  function  well 
(category 1), five function but need improvement (category 2) and five do not work 
(category 3). 

For  the  five  operational  programmes  classified  under  category  3  the  findings  show 
weaknesses  in  key  control  elements,  such  as:  1)  managing  authorities  do  not  carry 
out sufficient on-the-spot visits, 2) the certification process by the paying authority is 
weak  and  3)  there  is  no  follow-up  of  corrections.  An  action  plan  has  been  agreed 
with  the  national  auditors.  Reporting  on  the  implementation  of  corrective  actions 
should be provided in 2008. 

The  other  seven  programmes/systems  audited 
in 
assurance  with 
and 
categories 1 (reasonable 
limitations/acceptable  assurance)  depending  on  whether  no  deficiencies  or  only 
minor deficiencies in key and/or ancillary control elements were detected. 

in  2007  were  classified 
(reasonable 

assurance) 

2 

In total, 79 projects were checked by desk review and/or on-the spot visits for a total 
eligible  amount  checked  of  EUR  102.5  million  with  FIFG  participation  of 
EUR 48.2 million.  An  amount  of  EUR  10.3  million  was  identified  as  potentially 
the 
ineligible  amount 
ineligible.  This  potentially 
Community contribution  of  audited  programmes  and  2.00%  of  the  total  amount 
paid out by DG MARE in 2007 for the co-financing of FIFG programmes.  

represents  0.40%  of 

Since the beginning of the programming period 2000-2006, DG MARE has carried 
out  a  total  of  36  audit  missions,  covering  all  of  its  mono-fund  programmes 
(18 programmes for a budget contribution of EUR 3 608.73 million — 87.1% of total 
2000-2006 budget) as well as 13 of its multi-fund programmes for a contribution of 
EUR 269.48 million — 6.5% of total 2000-2006 budget. In total, DG MARE systems 
audits  have  covered  93.6%  of  the  total  FIFG  contribution  for  2000-2006.  For  the 

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26 

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other  programmes,  the  assurance  is  gained  from  other  Structural  Fund  DGs’  audit 
work and/or national audits.  

The  overall  result  shows  that  49  programmes  (covering  93.15%  of  the  FIFG 
2000-2006  allocation)  are  considered  to  be  working  well  or  working  but  some 
improvements  are  needed.  For  the  7  programmes  that  do  not  work  (6.66%  of  the 
FIFG  2000-2006  contribution),  actions  plans  have  been  issued  and  payments 
interrupted. The maximum amount at risk is estimated for most programmes at 10% 
of payments made in 2007 (which is 0.49% of 2007 payments). 

Other audit work for the programming period 2000-2006 included an examination of 
the  annual  control  reports  received  under  Article  13  of  Regulation  (EC) 
No 438/2001. Analysis of the reports was concluded with the dispatch of replies to 
the  Member  States  with  observations  and,  where  necessary,  requests  for  additional 
information  in  order  to  draw  as  much  assurance  as  possible  from  the  results  of 
national audit work. Furthermore, all national system audit reports received in 2007 
were  reviewed,  giving  rise  in  some  cases  to  further  observations/enquiries  for  the 
annual  coordination  meeting  or  even  interruption  of  payments  in  cases  where  an 
adverse  opinion  was  given  by  the  national  audit  authority  on  the  management  and 
control systems. 

5.5. 

OLAF 

In  2007,  OLAF  undertook  37  missions  in  the  Member  States  relating  to  measures 
co-financed  by  the  Structural  Funds.  Of  these,  19  concerned  on-the-spot  checks5 
(during  which  26  controls  were  carried  out  on  economic  operators)  and  18  others 
gathered 
judicial 
information  or  assisted  either  national  administrations  or 
authorities.  Typical  problems  identified  by  OLAF  in  the  course  of  2007  included 
false declarations, false invoicing and failure to abide by public procurement rules. 

In  2007,  Member  States  submitted  to  the  Commission,  in  accordance  with 
Regulation  (EC)  No  1681/94,6  some  3  7407  notifications  of  irregularities  involving 
EUR  717  431  387  affecting  co-financed  measures  from  the  1994-1999  and 
2000-2006  programming  periods.  124  notifications  concern 
the  1994-1999 
programming  period,  with  a  financial  impact  of  approximately  EUR  33  million. 
Member  States  have 
that  administrative  and/or 
judicial procedures have been concluded at national level in a number of cases and 
an amount of EUR 153 465 848 has been recovered. 

the  Commission 

informed 

In  2007,  both  the  number  of  notifications  and  the  amounts  involved  increased  by 
around  19.3%  and  17.9%  respectively,  as  compared  to  the  year  before.  The  main 
explanations  for  this  new  increase  seem  to  be:  1)  a  higher  number  of  irregularities 
from  the  new  Member  States  (EU-10)  as  a  result  of  full  implementation  of  the 
programmes  and  better  understanding  and  implementation  of  the  reporting 
obligation; and 2) the fact that the cohesion policy came under particular “pressure” 

5 
6 
7 

Regulation (EC) No 2185/1996, OJ L 292, 15.10.1996, p. 2. 
OJ L 178, 12.07.1994, p. 43. 
2006:  number  of  communicated  cases  2  988;  overall  amount  relating 
EUR 516 697 561. 

to  communications 

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27 

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from the control authorities. This is reflected in a higher number of irregularities than 
in 2006, even among the old Member States (EU-15).  

The  most  frequent  types  of  irregularities  reported  are  “non-eligible  expenditure”, 
while secondary irregularities include “infringement of rules of public procurement” 
and “missing or incomplete supporting documents”. 

The  figures  demonstrate 
Member States, in conformity with their Community law obligations. 

increased  awareness  and  better  reporting  by 

the 

Furthermore, on 7 November 2007 the Commission approved the Communication on 
the division of responsibilities and cooperation between the “authorising officers by 
delegation” in the Commission and OLAF for the financial follow-up of irregularities 
relating 
the  Agricultural  and 
Structural Actions areas [C(2007) 5709].  

to  expenditure  under  shared  management 

in 

6. 

COMMITTEES ASSISTING THE COMMISSION 

6.1. 

COCOF 

The  main  points  dealt  with  by  the  COCOF  Committee  can  be  classified  in  the 
following groups: 

–  points  where  the  Committee  acted  as  the  Committee  in  the  conventional 
comitology sense, namely, giving opinions on draft decisions of the Commission, 
e.g. Draft Decision amending Commission Decision 2006/769/EC of 31/10/2006 
drawing  up  the  list  of  regions  and  areas  eligible  for  funding  from  the  European 
Regional  Development  Fund  under  the  cross-border  and  transnational  strands  of 
the European territorial cooperation objective for the period 2007-2013 (Annex 1 
on  CBC  and  Annex  2  on  Transnational  Cooperation),  and  Draft  Commission 
Decision  concerning  the  financing  of  the  programme  for  the  use  of  operational 
and  non-operational  technical  assistance  at  the  initiative  of  or  on  behalf  of  the 
European Commission under the European Social Fund (ESF) for 2007; 

–  points  where  the  opinion  of  the  Committee  was  required  in  accordance  with 
Regulation  (EC)  No  1083/2006,  the  general  regulation  governing  the  Funds  for 
the 2007-2013 period, e.g. for the new programming period 2007-2013, Indicative 
guidelines on evaluation methods: Evaluation during the programming period — 
Working document No 5; Submission for opinion of the updating at mid-year of 
the various types of technical assistance measures to be financed by the ERDF and 
the  Cohesion  Fund  under  Article  45  of  Regulation  (EC)  No  1083/  2006  — 
Budget lines 13 01 04 01 and 13 03 20. 

The COCOF Committee was most frequently active as the forum for presenting and 
discussing interpretative documents and notes of the Commission, the aim being to 
share  the  views  with  the  Member  States  and  to  seek  their  opinions  on  the 
interpretations put forward. The main topics discussed were: 

–  Eligible expenditure in the 2007-2013 period; 

–  European Grouping of Territorial Cooperation; 

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28 

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–  Guidance Note on the Audit Strategy; 

–  Guidance Note on Compliance Assessment; 

–  Guidance  document  on  the  annual  summaries  under  Article  53b(3)  of  the 

Financial Regulation (annual summary of available audits and declarations); 

–  Guidelines for the determination of financial corrections applicable to expenditure 
co-financed  by  the  Structural  Funds  and  Cohesion  Fund  in  relation  to 
infringements of rules concerning public procurement; 

–  Information note of the Commission on ERDF support for investment in SMEs; 

–  Irregularities  —  Information  under  Article  9  of  Regulation  (EC)  No  1681/94 

(OLAF) 

–  “n+2” rule; 

–  Study on regional expenditure of the ERDF and Cohesion Fund. 

6.2. 

ESF Committee 

The  Committee  pursuant  to  Article  147  of  the  Treaty  (ESF  Committee)  met  three 
times in Plenary Session and its Technical Working Group seven times.  

the  ESF  Committee  was  consulted  on  115  of 

In  2007, 
the  117  ESF 
Operational Programmes  for  2007-2013  (the  other  2  Operational  programmes 
(Martinique  OP  and  Greece  Contingency  Reserve  OP)  will  probably  be  adopted  in 
2008).  It  was  also  consulted  on  the  Draft  Commission  Decision  for  ESF 
Technical Assistance  in  2007  and  on  the  Brochure  for  ESF  use  on  family  friendly 
policies. 

The  ESF  Committee  discussed  implementation  of  the  ESF  and  specifically  the 
visibility of the ESF and the role of the ESF Committee and thematic evaluations for 
2000-2006 
administrative 
capacity building. 

restructuring  management 

concerning 

and 

The  Technical  Working  Group  was  informed  of  the  state  of  play  regarding  the 
adoption  of  Operational  Programmes  for  2007-2013.  Among  others,  it  discussed 
audit and control issues, evaluation issues, the “n+2” rule and simplification aspects, 
including  the  flat  rate  rule  regarding  the  declaration  of  indirect  costs  and 
public tendering. 

6.3. 

Committee on Agricultural Structures and Rural Development (STAR) 

The STAR Committee met three times in 2007 and gave a favourable opinion on the 
amendment  to  a  rural  development  programme  (the  SAPARD  programme  for 
CROATIA) under Article 4 of Council Regulation (EC) No 1268/1999. 

6.4. 

Committee on Structures for Fisheries and Aquaculture (CSFA) 

In 2007, the Committee was consulted on a number of issues: the draft Commission 
Regulation  amending  Commission  Regulation  (EEC)  No  3440/84  as  regards 

EN 

29 

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financial  contribution 

conditions  for  certain  trawls  for  vessels  operating  pump  aboard  systems;  the  draft 
towards 
Commission  Decision  on  a  Community 
Member States’  fisheries  control,  inspection  and  surveillance  programmes  for  2007 
(second instalment); the draft Commission Regulation laying down detailed rules for 
the implementation of Council Regulation (EC) No 1966/2006 of 21 December 2006 
on  electronic  recording  and  reporting  of  fishing  activities  and  on  means  of  remote 
sensing;  the  draft  Commission  Regulation  on  landing  and  weighing  procedures  for 
herring, mackerel and horse mackerel; and the Commission Decision designating the 
Community Fisheries Control Agency. 

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Part 2: Analysis by Member State 

1. 

BELGIUM 

2007-2013 programming period 

Belgium  will  receive  EUR  2.258  billion  from  the  Structural  Funds  for  period  the 
2007-2013,  with  EUR  638  million  going  towards  the  Convergence  objective, 
EUR 1.425 billion towards the Regional Competitiveness and Employment objective 
and EUR 194 million towards the European Territorial Cooperation objective.  

The Walloon province of Hainaut will benefit from the Convergence objective. As it 
is  a  region  that  would  have  been  eligible  for  the  Convergence  objective  if  the 
threshold  had  remained  at  75%  of  the  average  GDP  of  the  EU-15  rather  than  the 
EU-25, Hainaut will continue to benefit from transitional support (phasing-out). 

The  remainder  of  Belgium  is  covered  by  the  Regional  Competitiveness  and 
Employment objective.  

In  the  previous  programming  period,  certain  areas  also  received  Objective  2 
subsidies (Meuse-Vesdre, Antwerp, part of the Namur province, the entire province 
of Luxembourg, West Flanders and East Flanders).  

Strategic  objectives  —  Given  Belgium’s  institutional  structure,  each  region  has 
developed a strategy adapted to its own socio-economic characteristics.  

ERDF (European Regional Development Fund) financing will benefit:  

–  Brussels-Capital Region: enhancing territorial cohesion and maintaining territorial 

competitiveness.  

–  Flemish Region: promoting the knowledge economy and innovation, stimulating 
entrepreneurship,  using  regional  features  that  attract  economic  interest,  and 
supporting urban development.  

–  Walloon  Region:  boosting  business  and  job  creation,  developing  human  capital, 
knowledge,  know-how  and  research,  and  ensuring  balanced  and  sustainable 
territorial development.  

ESF (European Social Fund) financing is focused on: 

–  Brussels-Capital  Region:  promoting  active  employment  and  social  integration, 

and increasing the participation of women on the labour market. 

–  Flemish Region: upgrading the skills and competencies of the workforce to satisfy 

the demands of the knowledge economy and promote innovation.  

–  Walloon  Region 

together  with  French  Community  (including  Hainaut): 
developing  employment,  enterprises,  human  capital,  knowledge,  know-how, 
research and social inclusion. 

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–  German-speaking  Community:  promoting  active  employment  and  social 

integration. 

–  Federal Belgium: supporting social integration. 

Expected impact of the new Cohesion Policy — The country requires a strategy for 
encouraging  investment  in  innovation  and  the  marketing  of  high-tech  products  and 
services, and for providing real incentives for research and development in line with 
the Lisbon objective of devoting 3% of GDP to R&D by 2010. The authorities have 
adopted  the  Lisbon  objectives:  the  employment  rate  should  approach  70%  for  the 
total population, 60% for women and 50% for 55-64 year-old workers.  

The programme should help to establish closer cooperation links between public and 
private  research  units,  an  attractive  work  environment  for  the  highly  qualified, 
financing  channels  suitable  for  venture  capital,  an  efficient  and  coherent  regulatory 
framework,  reduced  administrative  procedures  and  a  non-distorting  tax  system 
conducive to business activity.  

Investment for growth and jobs — In line with Community goals, expenditure will 
be  concentrated  on  the  Lisbon  Strategy  and  cohesion  objectives.  77%  of 
Convergence  subsidies  and  85%  of  Regional  Competitiveness  and  Employment 
subsidies will go towards Lisbon priorities.  

Operational programmes — Cohesion policy in Belgium will be implemented via 
ten  operational  programmes,  of  which 
the 
European Regional Development Fund (ERDF) and six by the European Social Fund 
(ESF). 

four  will  be 

financed  by 

2000-2006 programming period 

1.1. 

Objective 1 

Two  new  amending  decisions  were  adopted  in  April  and  October  2007.  The  first 
concerned the adoption of the financial plan in each axis, following approval by the 
monitoring committee  18  December,  and  adjustment  of  the  financing  plan  to  make 
for optimum  consumption  of the  budget. The  second decision confirmed  the “n+2” 
decommitment for EAGGF (2004 commitment). 

The  level  of  expenditure  presented  for  payment  to  the  ERDF  amounted  to  88%  of 
ERDF appropriations (EUR 375 908 847.13) at the end of 2007. Global execution for 
EAGGF-Guidance  at  the  end  of  2007  amounted  to  70%  of  EAGGF  appropriations 
(EUR 29 392 295). For ESF, payment claims submitted to the Commission at the end 
of  2007  amounted  to  73.74%  of  total  ESF  appropriations  (EUR  147  637  970). 
No payment requests were submitted in 2007 for the FIFG.  

1.2. 

Objective 2 

For the seven programmes under the Objective 2 from which Belgium benefits, the 
2006  annual  reports  for  each  programme  were  approved  by  the  corresponding 
monitoring  committees,  submitted  to  the  Commission  and  examined  by  the 
in June  and 
Commission.  Two  monitoring  committees  were  organised 
December 2007 for each programme. 

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The main subjects dealt with by the monitoring committees were:  

–  approval of the 2006 Annual Implementation Reports, 

–  programme changes mentioned above and below, 

–  follow-up of the “n+2” situation, 

–  a state of play with the new 2007-2013 NSRFs and OPs. 

As regards the Objective 2 SPD in Walloon Region (Meuse-Vesdre and Rural), the 
monitoring  committees  ratified  modifications  in  December  2007  based  on  sound 
management  of  each  programme,  thus  requiring  a  new  adjustment  of  the  financing 
plan  and  adoption  of  a  new  programme  complement  in  2008.  The  levels  of  ERDF 
expenditure  are  respectively  EUR  108  766  922.51  and  EUR 43 861 424.61,  which 
correspond  to  79%  and  80%  of  ERDF  appropriation  rates.  The  levels  of  ESF 
expenditure are respectively EUR 17 162 005 and EUR 3 656 156, which correspond 
to 66.7% and 64.92% respectively of ESF appropriation rates. 

For  all  four  Objective  2  programmes  for  Flanders,  the  allocated  funds  are  fully 
committed. The payments level fully covered the required “n+2” level for the ERDF 
(total ERDF payments for Flemish programmes: EUR 153 320 537.41, which means 
average  spending  of  86.69%  of  the  total  ERDF  contribution).  For the  three 
Objective 2 programmes involving the ESF in Flanders, payment claims submitted to 
the  Commission  amounted  to  EUR  12  120  543,  corresponding  to  70.73%  of 
ESF appropriations. 

For Brussels-Capital Region, the progress on ERDF expenditure (only an intervening 
fund) continued in 2007, thereby avoiding any decommitment under the “n+2” rule. 
The  level  of  the  expenditure  presented  for  payment  to  the  ERDF  amounted  to 
76.03% of the ERDF allocation (EUR 34 952 654.85) at the end of 2007. 

1.3. 

Objective 3 

The total ESF appropriation for Objective 3 is EUR 798.4 million, divided over five 
operational  programmes.  All  five  programmes  are  performing  according  to  plan. 
For the Federal SPD, the total ESF budget amounts to EUR 70.1 million. The level 
of  expenditure  declared  to  the  Commission  in  2007  amounts  to  EUR  29.8  million 
(42%  of  the  total  ESF  appropriation).  The  Flemish  programme  has  a  total 
ESF budget of EUR 392.5 million. The entire budget has been allocated to projects. 
The declared expenditure at the end of 2007 amounted to EUR 312.0 million or 80% 
of  the  total  ESF  budget.  The  programme  for  the  Wallonia-French  Community 
programme has a total ESF budget of EUR 297.9 million. Total payments at the end 
of  2007  amounted  to  EUR  234 355 670.  The  ESF  budget  for  the  Brussels  region 
amounts  to  EUR  24.7  million,  95%  of  which  had  been  paid  at  the  end  of  2007. 
The German-speaking  Community  has  a  separate  Objective  3  programme,  with  a 
total ESF budget of EUR 11.2 million. At the end of 2007, the expenditure claimed 
from  the  Commission  amounted  to  EUR  10.6  million  or  95%  of  the  total  budget. 
Implementation of this programme is finalised. 

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1.4. 

Fisheries outside Objective 1 

Currently the total FIFG allocation to the fisheries programme is EUR 23.57 million. 
The  most  important  measures,  in  line  with  the  Common  Fisheries  Policy,  are 
scrapping of vessels, modernisation of the fleet, processing and marketing, collective 
investments  and  innovative  measures.  Implementation  of  the  programme  continued 
at  a  rather  slow  pace.  As  a  result,  with  regard  to  the  “n+2”  target  for  2007,  the 
Commission envisages a decommitment of EUR 2.26 million. 

1.5. 

Community Initiatives 

1.5.1.  Equal 

There  are  two  EQUAL  programmes  in  Belgium:  one  for  the  French-  and 
German-speaking  communities,  and  one  for  the  Dutch-speaking  community. 
The French-  and  German-speaking  programme  proceeded  without  any  major 
difficulties  in 2007.  In  financial  terms, the rate of  execution of the ESF  part of  the 
programme  at  the  end  of  2007  was  66.83%.  Automatic  decommitment  under  the 
“n+2”  rule  was  avoided  for  2007.  The  Dutch-speaking  EQUAL  programme  also 
proceeded  without  major  difficulties  in  2007.  At  the  end  of  2007,  the  rate  of 
execution of the ESF part of the programme was 55.88%. There will be an automatic 
decommitment  of  EUR 0.510  million  under  the  “n+2”  rule.  The  two  EQUAL 
programmes supported around 125 projects, mainly in fields such as employability, 
adaptability, life-long learning and social economy. 

1.5.2.  Leader 

Belgium  has  two  Leader+  programmes:  one  for  Flanders,  involving  total  public 
expenditure  of  EUR  7  984  200,  and  one  for  Wallonia,  involving  total  public 
expenditure  of  EUR  20  669  294.  For  both  programmes,  the  allocated  funds  have 
been fully committed.  

At the end of 2007, total financial execution came to EUR 9 103 761, i.e. 63.54% of 
total EAGGF-Guidance expenditure earmarked for the period 2000-2006. 

1.5.3.  Urban 

There are three URBAN II programmes in Belgium. The programmes for Brussels, 
Antwerp  and  Sambreville  were  all  approved  on  12  November  2001;  two  of  them 
were  amended  in  2006  (Antwerp,  Sambreville)  and  the  other  (Brussels)  in  2007. 
Each  programme  originally receives EUR 7.173 million from the ERDF, but  under 
the “n+2” rule at the end of 2005, the contribution was reduced to EUR 7.130 million 
for Antwerp and, at the end of 2006, to 7.083 million for Brussels. The total budget 
for Brussels is EUR 14.3 million, for Antwerp EUR 22.9 million and for Sambreville 
EUR 17.1 million.  

Annual reports for 2006 were submitted by all three programmes and approved. 

For  all  three  programmes,  the  management  authority  is  the  region.  The  monitoring 
committee of each programme met at least once.  

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Two programmes reached the “n+2” targets for 2007. For Brussels-Capital, there was 
a decommitment of less than EUR 95 000. A new decision was adopted in 2008.  

Overall comments concerning the 2000-2006 period in Belgium 

The  Sambreville  programme  is  the  biggest  in  Belgium  and  has  already  reached  a 
significant  number  of  their  targets.  Many  of  the  projects  have  been  completed  or 
started. Some tangible benefits are starting to become visible in terms of jobs created, 
unemployed  trained,  SMEs  started,  companies  expanding,  etc.  The  added  value  of 
URBAN  II  is  that  it  has  made  a  big  difference,  by  starting  a  dynamic  that  has 
changed  the  image  of  Sambreville,  allowed  it  to  attract  a  number  of  high  value 
companies  and  put  work  in  a  stronger  partnership  with  the  private  sector  and  the 
local  population.  The  Antwerp  programme  had  a  very  slow  start,  although  the 
projects  currently  being  developed  should  make  the  impact  more  tangible. 
The Brussels-Capital  URBAN  II  programme  has  been  seen  as  a  small  appendix  to 
the Objective 2 programme, but it has been a successful addition to the latter and to 
urban regeneration agreements. 

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2. 

CYPRUS  

2007-2013 programming period 

The  procedures  for  the  adoption  of  the  NSRF  and  OP  for  Cyprus  for  2007–2013 
were  already  advanced  by  early  2007.  ERDF  commitments  of  EUR  75.6  million 
were  made  in  2007  for  the  new  programming  period,  with  an  advance  payment  of 
EUR 5.6 million. 

The National Strategic Reference Framework for Cyprus for 2007–13 was submitted 
by  the  Cypriot  authorities  on  21  December  2006.  The  decision  adopting  the  NSRF 
(C(2007)  2015)  was  taken  on  7  May  2007.  In  2007–13  Cyprus  will  have  one 
ERDF/CF Operational Programme, which will cover both the Convergence and the 
Regional Competitiveness and Employment objectives. 

The Operational Programme on Sustainable Development and Competitiveness was 
submitted  on  5  March  2007  and  approved  on  17  September  2007  by 
Decision C(2007) 4351. It provides EUR 492 665 838 of Community funds for the 
years  2007–13,  of  which  EUR  279  461  354  from  the  ERDF  under  the 
Regional Competitiveness and Employment Objective, while the Cohesion Fund will 
contribute EUR 213 204 484 under the Convergence Objective. 

The  ESF  Operational  Programme  “Employment,  Human  Capital  and  Social 
Cohesion” was submitted on 5 March 2007  and approved on 8 November 2007 by 
Decision  C(2007)5507-1.  It  will  provide  maximum  assistance  from  the  European 
Social  Fund  of  EUR  119  769  154,  as  calculated  with  reference  to the  total  eligible 
public  expenditure.  The  maximum  co-financing  rate  as  a  whole  will  be  80%. 
The strategic  objective  of  the  ESF  Programme  is  full  and  quality  employment,  the 
development  of  human  resources  and  the  consolidation  social  cohesion  and  equal 
opportunities. An indicative 78% of ESF financing for the period 2007-2013 will be 
directed towards broader Lisbon-related priorities (earmarked). 

2000-2006 programming period 

2.1. 

Objective 2 

Interim  payments  for  EUR  6.1  million  were  paid  into  the  2004-206  programme. 
The 2006 Annual Report for the Single Programming Document for 2004–2006 was 
approved  by  the  monitoring  committee,  and  received  and  approved  by  the 
Commission. A revised Programme Complement was received in the second half of 
2007 and was accepted by letter of 6 February 2008. 

A  monitoring  committee  meeting  for  SPD  2  and  an  Annual  Review  meeting  took 
place  in  Cyprus  in  2007.  For  the  new  programming  period  2007-2013,  the  first 
monitoring  committee  meeting  and  the  launch  event  took  place  in  November. 
In addition,  various 
technical  meetings  and  project  visits  were  organised 
during the year. 

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2.2. 

Objective 3 

An  interim  payment  claim  of  EUR  6  022  906.97  was  submitted  by  the  Cypriot 
authorities on 21 December 2007, fully covering the 2005 commitment. 

The 2006 Annual Implementation Report for the Single Programming Document for 
2004–2006 was approved by the monitoring committee, and received and approved 
by the Commission. 

A  monitoring  committee  meeting  for  SPD  3  and  an  Annual  Review  meeting  took 
place in Cyprus in 2007.  

For the programming period 2007-2013, the first monitoring committee meeting and 
the launch event took place in November. 

2.3. 

Fisheries outside Objective 1 

The  Fisheries  Operational  Programme  for  Cyprus,  adopted  by  the  Commission  in 
2004,  entered  its  fourth  year  of  implementation.  At  the  end  of  2007,  most  of  the 
programme’s resources had been allocated by the managing authority and payments 
reached  nearly  60%  of  the  total  FIFG  available  funds,  avoiding  the  risk  of  loss  of 
funds because of the “n+2” rule. 

The monitoring committee met in 2007, covering mainly monitoring and evaluation 
of progress. 

2.4. 

Community Initiatives 

2.4.1.  Equal 

In  2007,  EUR  286  165  of  ESF  payments  were  made  for  the  CI  EQUAL. 
Approximately EUR 280 000 falls under the “n+2” rule and will be decommitted. 

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3. 

CZECH REPUBLIC 

2000-2006 programming period 

During  2007,  the  relatively  slow  start  in  absorbing  the  Structural  Funds  of  the 
programming period 2004-2006 improved. For most Operational Programmes a solid 
project  pipeline  has  been  developed,  most  of  them  have  been  contracted  and 
implementation on the ground is advancing. Expenditures on the ground by the end 
of 2007 correspond to 70% of the total 2004-2006 budget. 

The risk of losing part of the Structural Funds commitment by the end of 2007 due to 
the  “n+2”  rule  was  thus  resolved  for  all  programmes,  including  SPD  Prague 
Objective 2 and the OP Human Resources Development, the programmes facing the 
most serious absorption problems.  

In comparison with the other new Member States, the Czech Republic is still in the 
slower group of countries in terms of absorption of the Structural Funds, but there are 
signs  of  an  upward  trend.  Weaknesses  remain  in  the  administrative  capacity 
(including high turnover of staff) and in the management reporting systems, mainly 
at  the  level  of  the  Ministry  for  Regional  Development  (national  coordinator  of  all 
OPs)  but  also  at  the  level  of  the  managing  authorities  and  certain  intermediary 
bodies. Together with the lack of a reliable system of forecasts, these factors make it 
difficult  for  the  Czech  authorities  to  plan  efficiently  and  to  implement  preventive 
measures. To improve the situation, the Commission has strongly recommended an 
action  plan  to  establish  a  basic  harmonised  monitoring  and  information  system  to 
manage the funds.  

The  2006  Annual  Implementation  Reports  were  submitted  for  each  Operational 
Programme in good time. All of them were deemed admissible and thus accepted by 
the Commission without significant objections.  

3.1. 

Objective 1  

The Community Support Framework for the period 2004-2006 covers a total budget 
of EUR 1 954 million, of which EUR 1 454 million is contributed by the Structural 
Funds  (63%  ERDF,  25%  ESF,  11.5%  EAGGF  and  0.5%  FIFG).  Five  Operational 
Programmes are implemented under the CSF.  

The  CSF  Managing  Authority,  at  the  Ministry  for  Regional  Development,  is 
responsible  for  the  effectiveness,  correct  management  and  delivery  of  the  support 
provided by the Structural Funds in the Czech Republic. 

Two monitoring committees for the CSF met in 2007: one on 17 June 2007 and one 
on 18 December 2007. The annual report for 2006 was discussed during the meeting 
implementation  of  related 
in  June.  The  second  meeting  focused  on 
Operational Programmes with a view to the upcoming closure. The need for efficient 
management and coordination at CSF level was also stressed.  

the 

The  Joint  Regional  Operational  Programme  (JROP),  the  largest  Czech  OP  with  a 
share  of  31.2%  (EUR  454  million)  of  the  total  Objective  1  allocation  (28%  ERDF 

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and  3.2%  ESF),  held  two  monitoring  committee  meetings  in  2006:  one  on 
7vJune 2007 and one on 14 October 2007. Implementation of the JROP measures has 
progressed significantly compared to 2006: 120% of the budget was approved by the 
end of 2007, 90% of that amount was executed, of which 74% was certified. The best 
performing  JROP  measures  are 
the  schemes  supporting  regional  business 
infrastructure and the development of services in tourism. Payments were sufficient 
by and large to avoid any application of “n+2” rule for the 2005 commitment. 

The Human Resource Development Operational Programme accounts for a share of 
21.2%  (EUR  318.8  million,  ESF  contribution)  of  the  total  Objective  1  allocation. 
One monitoring committee meeting took place on 14 June 2007, the second meeting 
being  postponed  until  5  February  2008.  The  annual  meeting  was  organised  on 
25 September 2007. Implementation caught up during 2007, with almost 100% of the 
total budget of the OP being contracted, although in terms of (certified) spending the 
OP is still clearly lagging behind. The main sources of delay are the late start of OP 
implementation, fluctuation of staff and the need to manage a large number of small 
projects in a rather complex implementing system. The best performing measures are 
3.1  (Enhancing  the  quality  of  education  at  school  and  school  facilities)  and  1.1 
(Strengthening active employment policy for job seekers and job applicants). Interim 
payment claims totalling EUR 132 million were submitted by the end of 2007, which 
covers  only  41.4%  of  the  total  budget  for  2004–2006.  Payments  were  nonetheless 
sufficient to avoid any application of the “n+2” rule for the 2005 commitment.  

The  Operational  Programme  Industry  and  Enterprise  is  the  third  largest  OP  with 
17.9% (only ERDF) of the total Objective 1 allocation. Two monitoring committee 
meetings  were  organised  for  this  OP  in  2007:  one  on  4  June  2007  and  one  on 
15-16 November  2007.  This  remains  one  of  the  best  performing  Operational 
Programmes,  with  59%  of  the  total  budget  executed,  of  which  46%  was  certified. 
Nevertheless,  during  the  period  under  scrutiny,  there  was  a  certain  slowdown  in 
implementation,  mainly  due  to  organisational  and  administrative  changes  in 
CzechInvest, the principal intermediate body for this Programme. The most popular 
measures  remain  schemes  supporting  small  and  medium-sized  enterprises, 
innovation schemes and two loan schemes aimed at starting entrepreneurs and firms 
in  the  initial  development  stage,  whereas  schemes  targeting  energy  saving  and 
the  moment. 
renewable 
This Operational Programme had easily attained the threshold for the “n+2” rule for 
the 2005 commitment. 

lagging  behind 

sources  of 

energy 

are 

for 

(only  ERDF)  of 

the  Objective  1  budget 

The  Operational  Programme  Infrastructure  (OPI)  is  the  fourth  largest  OP,  with 
almost  16.9% 
allocation. 
Two monitoring committee meetings were held for this programme in 2007: one on 
15 March 2007 and one on 9 December 2007. Implementation of the OPI measures 
has progressed significantly compared to 2006: 115% of the budget was approved by 
the end of 2007, in favour of 383 operations, payments on the ground cover 98% of 
the  total  budget  and  75%  of  the  total  budget  was  certified.  The  best  performing 
measures  of  OPI  are  those  relating  to  transport  infrastructure.  Payments  were 
sufficient by and large to avoid any “n+2” risks for the 2005 commitment.  

The  monitoring  committee  of 
the  Agriculture  and  Rural  Development 
Operational Programme  held  two  meetings  in  2007  (in  May  and  November). 
The 2006  annual  implementation  report  was  submitted  to  the  Commission  in  June 

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39 

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and was subsequently approved. Implementation of the programme is progressing a 
satisfactorily,  the  most  popular  measure  being  investment  in  agricultural  holdings 
(making up almost 50% of the OP, for which almost 70% of the allocation has been 
paid). 65% of allocated funds had been utilised by the end of 2007. No changes were 
made 
total  of 
EUR 64 530 125 were submitted to DG AGRI in 2007. This amounts to 38.01% of 
the total EAGGF-Guidance allocation for this OP for the period 2004-2006. 

interim  payment  requests  amounting 

in  2007.  Three 

to  a 

Fisheries 

As  FIFG  execution  was  low,  the  OP  Rural  Development  and  Multifunctional 
Agriculture was changed in 2007 by Decision C(2006) 7276. The FIFG contribution 
has  thus  been  reduced  from  EUR  7.25  million  to  EUR 4.1  million.  Two  payments 
paid  in  2007  improved  the  spending  rate  instantly  after  the  reallocation  of  unused 
financial  resources  from 
the  FIFG  (i.e.  from  measures  2.3  Fisheries  and 
3.1 Technical Assistance) to the EAGGF measures. The cumulative FIFG sum paid 
to  the  Czech  Republic  is  EUR  3 905  million.  At  present,  this  fund  has  reached  the 
95% threshold of payment rate and is awaiting the closure procedure. One payment 
claim at the end of 2007 exhausted the remaining balance of the 2005 commitment, 
and  thus  there  is  no  problem  with  the  “n+2”  rule.  Regular  monitoring committee 
meetings are held. 

3.2. 

Objective 2 

the 

from 

(only 

Funds 

Structural 

The  Single  Programming  Document  Prague  Objective  2  receives  support  of 
EUR 71.3 million 
ERDF). 
Two monitoring committee  meetings  were  organised  for  this  programme  in  2007. 
Despite  a  marked  acceleration  in  project  implementation  in  2007,  progress  on  the 
SPD  Objective  2  was  still  lagging  behind  other  Operational  Programmes  in  the 
Czech Republic to some extent. The principal reason lies in the fact that right, after 
its launch, the SPD2 Prague had concerns with an insufficient number of projects in 
the  pipeline,  a  fact  that  hindered  successful  absorption  of  the  available  budget. 
Nevertheless, the whole allocation was approved (allocated to projects) during 2007, 
compared with only 15.5% of the total available budget approved by the end of 2006. 
The  best  performing  measures  are  the  ones  dealing  with  transport  systems  and 
improvement  of  public  infrastructure  in  the  suburban  areas  of  Prague.  91%  of  the 
latter measure was already executed by the end of 2007. The risk of “n+2” rule was 
finally avoided at the end of 2007. 

3.3. 

Objective 3 

The Single Programming Document Prague Objective 3 receives EUR 58.79 million 
from  the  Structural  Funds  (ESF  only).  Two  monitoring  committee  meetings  took 
place in 2007: on 13 February 2007 and on 13 June 2007. The annual meeting was 
organised  on  25  September  2007.  Implementation  caught  up  during  2007,  with 
almost  100%  of  the  total  budget  contracted  to  projects,  although  in  terms  of 
(certified) spending the SPD is still lagging behind somewhat. The main sources of 
delay are a late start to OP implementation, low absorption capacity and the need to 
manage a large number of small projects in a rather complex implementing system. 
The  best  performing  measures  are  3.1  (Development  of  initial  education  as  a  basis 
for  lifelong  learning)  and  2.1  (Integration  of  specific  groups  at  risk  of  social 

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40 

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exclusion). Interim payment claims totalling EUR 29.5 million were submitted by the 
end of the year 2007, which covers 50% of the total budget for 2004–2006 and was 
enough to avoid decommitment at the end of 2007. 

3.4. 

Community Initiatives 

3.4.1.  Equal 

The Czech EQUAL programme receives support of EUR 32.1 million from the ESF. 
Two  monitoring  committee  meetings  took  place  in  2007:  on  12  June  2007  and  on 
19 December  2007.  Financial  implementation  improved  during  2007,  although  in 
terms of (certified) spending the programme is still lagging behind. The programme 
is  reaching  implementation,  and  the  Czech  authorities  are  working  intensively  to 
mainstream the results of this initiative. There are six thematic networks established 
in the Czech Republic: 

–  Integration of people with difficulties into the labour market 

–  Entrepreneurship 

–  Social economy and community services 

–  Adaptability and lifelong learning 

–  Equal opportunities for men and women; 

–  Integration of foreigners and racially discriminated persons into the labour market. 

Interim  payment  claims  totalling  EUR  15.5  million  were  submitted  by  the  end  of 
2007,  which  accounts  for  48%  of  the  total  budget  for  2004–2006  and  was  still 
enough to avoid decommitment at the end of 2007. 

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41 

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4. 

GERMANY 

2000-2006 programming period 

fact 

regularly 

that  some  programmes  have  suffered  an  “n+2” 

The overall performance of programme implementation in German regions was good 
and,  in  general,  the  core  targets  can  be  expected  to  have  been  globally  attained, 
despite 
loss. 
the 
their  monitoring  committees  about 
Managing authorities 
programme  execution  in  financial  terms,  with  respect  to  the  targets  set  for  each 
(sub-)period,  and  the  development  of  key  indicators  such  as  jobs  created  and 
investment  volume  co-financed,  as  compared  to  the  targets  set  for  the  programme. 
In addition  to  that,  information  on  programme  execution  is  delivered  in  the  annual 
implementation  reports.  Apart  from  issues  concerning  programme  execution,  the 
main  focus  of  discussions  in  the  monitoring  committee  meetings  was  on  the 
preparation of the new programming period.  

inform 

In addition to their duties regarding implementation of the 2000-2006 programmes, 
the  managing  authorities  led  and/or  followed  negotiations  with  the  Commission  on 
the  new  operational  programmes  for  the  period  2007-2013.  The  National  Strategic 
Reference  Framework  was  adopted  in  May  2007.  All  18  new  ESF  and  18  ERDF 
German  operational  programmes 
the  Objectives  “Convergence”  and 
“Regional competitiveness  and  employment”  were  submitted  and  successfully 
negotiated  through  to  final  adoption  in  2007.  The  ESF  will  be  managed  through 
18 programmes,  including  one  multi-objective  programme  at  federal  level  and  one 
programme per Land (Niedersachsen being an exception with two ESF programmes). 

for 

4.1. 

Objective 1 

Overall, financial absorption of ERDF contributions in German Objective 1 regions 
was very satisfactory in 2007 and attained more than 99%. The ESF reached 100%. 
Only the Objective 1 area of Berlin reported an amount of about EUR 12 million not 
spent from its 2005 commitment, which will be decommitted at closure. 

to  be  claimed  by 

The general outlook for all Objective 1 regions in Germany is very positive for 2008 
(the final year of the programming period 2000-2006). ERDF and ESF contributions 
still 
total 
2000-2006 commitments. There was only one programme change made in 2007, by 
which  Berlin  adapted  its  financial  plans  to  the  “n+2”  loss  of  about  EUR  2  million 
incurred in 2004.  

the  end  of  2007  were  below  10%  of 

Each  programme  had  to  submit  one  or  two  programme  complement  changes  to  be 
accepted  by  the  Commission.  In  the  majority  of  the  cases,  these  changes  aimed  to 
fine-tune the financial endowment at measure level so as to avoid financial losses at 
programme  closure  on  31  December  2008.  A  certain  number  of  programme 
complements were adapted in view of the shortage of appropriate projects in certain 
measures, funds being shifted to other measures with more promising projects with a 
view to avoiding “n+2” losses. 

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42 

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The  overall  performance  of  physical  programme 
the 
German Objective 1 regions was good and, in general, the core targets as set in the 
programmes can be expected to have been globally attained. 

implementation 

in 

The  FIFG  Programme  for  Germany  under  Objective  1  performed  well  enough  to 
avoid any decommitment at the end of 2007. Legally binding commitments by then 
amounted to EUR 91 495 213, payments to final beneficiaries EUR 86 920 452. 

Since the beginning of the period, more than 2.7 million people have participated in 
ESF  measures  in  Objective  1  regions.  More  than  40%  of  them  were  young  people 
(17-24 years) and around 10% were start-ups. Within the different priorities, around 
40% was spent on “Active and preventive Labour Market Policy”, 21% on “Society 
without  Exclusion”,  8%  on  “Vocational  Training,  Systems  and  Infrastructure”, 
20% on  “Adaptability  and  Entrepreneurship”,  10%  on  “Equal  Opportunities”  and 
about 1% on “Local Social Capital”. 

Six German regions benefit from EAGGF Objective 1 programmes. 

Payments  made  by  the  Commission  to  the  German  regions  in  2007  amount  to 
EUR 312.617 million.  The  operational  programmes  for  Berlin,  Saxony-Anhalt  and 
Mecklenburg-Western  Pomerania  reached  the  maximum  level  of  95%  of  the  total 
Community contribution. 

In  2007,  58.63%  of  2006  commitments  were  used  and 
EAGGF-Guidance  contribution  during  2000-2006  reached  93.94%  of 
commitments. 

the  cumulative 
total 

4.2. 

Objective 2 

Financial  absorption  of  ERDF  contributions  in  German  Objective  2  regions  was 
satisfactory  overall  and  attained  almost  98%.  Three  regions  (Rheinland-Pfalz, 
Saarland  and  the  Objective  2  area  of  Berlin)  had  not  been  able  to  absorb  full  their 
2005  commitments  by  the  end  of  2007.  Financial  absorption  of  the  ESF  reached 
100%.  The  outlook  for  2008  is  encouraging,  however,  since  on  average  payment 
claims had not been submitted for only 13% and 20% of total 2000-2006 ERDF and 
ESF commitments respectively by the end of 2007.  

Each programme had to make to one or two changes to its programme complement, 
which in some cases concerned adapting financial plans to the “n+2” losses incurred 
in  2004  (Baden-Württemberg,  Bremen  and  Rheinland-Pfalz),  and  updating 
information contained in the programming documents in others. In a number of cases 
(for example in Baden-Württemberg, Hamburg, Nordrhein-Westfalen), changes had 
become  necessary  to  respond  to  a  shortage  of  good  projects  in  certain  areas,  with 
funds  being  shifted  to  measures  where  more  promising  projects  could  be  expected. 
These changes were made to avoid problems with the “n+2” rule.  

Overall, however, the outlook regarding programme implementation is positive since 
no fundamental problems are expected for 2008 and the regions will generally meet 
the targets set in the programmes. 

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43 

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4.3. 

Objective 3 

The Objective 3 programme is the largest in Germany, covering ESF support for the 
West German Länder and Berlin. It is partly managed by the Government (Bund) and 
partly  by  the  Länder.  With  the  implementation  of  the  Labour  Market  reforms  in 
Germany, an increasing share of the programme was shifted to the Länder. Support is 
granted  to  six  priorities:  i)  “Active  and  preventive  Labour  Market  Policy”, 
iii)  “Vocational  and  general  Education, 
ii) “Society  without  Exclusion”, 
Entrepreneurship”, 
Lifelong Learning”, 
v) “Equal Opportunities”,  and  vi)  “Local  Social  Capital”.  More  than  2.5  million 
people have already participated in projects co-financed by the ESF. About one third 
of  all  participants  are  young  people,  a  fact  which  reflects  the  particular  attention 
given to this group. In 2006, about 58% of all unemployed young people living in the 
Objective 3 area were supported by the ESF.  

iv) “Adaptability 

and 

A last modification of the Objective 3 Programme was requested at the end of 2006 
and  adopted  in  2007.  As  a  consequence,  a  change  was  made  to  the  programme 
complement  to  adjust  the  financial  plan.  The  change  allowed  the  programme  to  be 
fine-tuned  before  closure.  The  measures  to  fight  against  youth  unemployment,  to 
promoter  Lifelong  Learning  and  Local  Social  Capital  saw  an  increase  in  budget 
allocation  whereas  the  priority  Adaptability  and  Entrepreneurship  was  once  again 
reduced due to insufficient take-up.  

Two  meetings  of  the  monitoring  committee  were  organised  in  which  DG  EMPL 
participated.  During  these  meetings,  particular  emphasis  was  given  to  a  possible 
“n+2”  risk  for  the  year  2007  and  to  the  potential  risk  of  unspent  funds  at  closure. 
Whereas  no  funds  were  lost  in  2007,  some  underspending  remains  likely  at  the 
closure of the programme. 

4.4. 

Fisheries outside Objective 1 

The  Fisheries  Programme  for  Germany  outside  Objective  1  faced  another 
decommitment of EUR 6 434 197 at the end of 2007. Accumulated payments amount 
to EUR 46 170 796 or 67% of the commitments of EUR 69 426 526.  

4.5. 

Community Initiatives 

4.5.1.  Equal 

The  German  EQUAL  programme  proceeded  without  difficulties 
in  2007. 
Declared expenditure for 2007 did not cause any problem as payment requests were 
sent  in  more  frequently  than  at  the  beginning  of  the  programming  period. 
The programme had no automatic decommitment under the “n+2” rule. In financial 
terms, the rate of execution of the ESF part of the programme at the end of 2007 was 
85%  (including  payments  on  account).  Following  the  amendment  to  the  Decision 
in 2004, no further changes have been made. One monitoring committee meeting for 
the  programme  was  held  in  June  2007,  which  mainly  discussed  the  Annual  Report 
and the mainstreaming of EQUAL activities.  

Germany organised an event on business creation and social economy in June 2007, 
which looked at the mainstreaming of EQUAL projects and taking this forward to the 

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44 

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new  ESF  programming  period.  The  EQUAL  closure  conference  took  place 
in December 2007. 

4.5.2.  Leader 

Thirteen German regions (Bundesländer) and the national network participate in the 
Community Initiative Leader+. 

In 2007, EUR 58.1 million was paid, bringing total payments to EUR 205.2 million, 
total). 
out  of 
Only Saxony Anhalt has reached the maximum level of 95% of the total Community 
contribution.  

total  commitments  of  EUR  267.4  million 

(77%  of 

the 

In line with the “n+2” rule, an amount of EUR 51 433 had to be decommitted from 
the  Leader+  programme 
to  2005). 
Implementation of the other programmes progressed satisfactorily. The annual report 
for 2006 was received and accepted in 2007 for all programmes except the one for 
Schleswig Holstein, which was approved at the beginning of 2008. 

for  North  Rhine-Westphalia 

(relating 

4.5.3.  Urban 

There  are  twelve  URBAN  II  programmes  in  Germany,  with  a  total  ERDF 
contribution of EUR 150.9 million (Berlin, Bremerhaven, Dessau, Dortmund, Gera, 
Kassel, Kiel, Leipzig, Luckenwalde, Mannheim/Ludwigshafen, Neubrandenburg and 
receive 
Saarbrücken).  The 
EUR 15.1 million, with the exception of Leipzig, which receives EUR 14.9 million. 
The  six  programmes  in  the  Western  part  of  Germany  each  receive  an  ERDF 
contribution of EUR 10.1 million. The total eligible cost of the twelve programmes is 
EUR 276.8 million.  

the  new  Länder  each 

six  programmes 

in 

An  annual  report  for  2006  was  received  for  all  programmes  and  accepted  in  2007. 
For nine programmes, the managing authority is at the level of the “Land” whereas 
for  the  cities  of  Kassel,  Kiel  and  Saarbrücken  it  was  transferred  to  the  municipal 
authorities during the course of the programme. 

In general, the monitoring committees met once or twice a year, usually in spring and 
autumn 2006. Cities that met only once sent all the relevant information by written 
procedure  to  the  members  of  the  monitoring  committees  and  sent  updated 
information on the state of implementation of projects. 

All German URBAN II programmes met the “n+2” rule for 2005 in 2007.  

Overall comments concerning the 2000-2006 period  

The  performance  of  the  German  URBAN  II  Programmes  can  be  described  as 
“very successful”, both in implementation and in management. The main focus of the 
programmes was an improvement in the economic performance of distressed urban 
areas. Taking an applied integrated approach towards sustainable urban development, 
these  economic  measures  were  successfully  combined  with  social,  environmental 
and  cultural  activities.  In  addition,  new  forms  of  governance  and  the  active 
involvement  of  citizens  in  the  implementation  of  the  programmes  help  to  meet  the 
(in part very) ambitious goals of the programmes. 

EN 

45 

   EN 

Also,  good  management  of  the  programmes  supported  the  efforts  made  within  the 
URBAN  II  programmes.  The  management  of  all  German  programmes  has  been 
effective and successful. A very innovative management approach was taken by the 
Mannheim-Ludwigshafen  programme,  where  one  joint  programme  for  two  cities 
(situated in two different Länder) led to new forms of cooperation between the cities, 
in and outside the programme context. In the cases of Kassel, Kiel and Saarbrücken, 
the  role  of  the  managing  authority  was  successfully  sub-delegated  to  the 
local (city) level.  

is 

the 

good 

practice 

bilateral 

Another  European 
“German-Austrian 
URBAN Network”  —  a  platform  of  information  for  the  thematic  exchange  of 
experience.  Established  in  1994-1999,  the  network  to  date  includes  the  12  German 
and the two Austrian  URBAN  II cities, plus  several other interested  cities/partners. 
Within  the  framework  of  this  network,  several  high-ranking  international  URBAN 
this  Structural  Funds  period 
Conferences  were  organised 
throughout 
(Strassbourg 2003,  Saarbrücken  2005  and  Graz/Maribor  2006). 
In  2007, 
three thematic meetings took place: on 19-20 April in Ludwigshafen and Mannheim, 
on  18-19  June  in  Gera  and  on  20-21  September  in  Dessau.  The  programme 
managers,  the  Federal  Ministry  for  Economy  and  Technology  and  the  Commission 
used these occasions to meet and discuss programme management issues. 

4.6. 

Closure of the 1994-1999 programming period 

ERDF 

the  Commission 

In  2007,  three  German  Operational  programmes,  with  an  open  amount  of 
EUR 7 million,  were  closed,  but  there  are  still  15  programmes  or  Community 
initiatives  to  be  closed,  with  an  open  amount  of  EUR  103  million.  For three 
Saxony programmes, 
financial 
corrections pursuant to Article 24 of Regulation (EC) No 4253/88, after completing 
the  required  procedural  steps  in  2007  without achieving  consensus  between  the 
Commission and the Member State concerned. The Commission is expected to adopt 
a  decision  in  the  first  half  of  2008  whereby  the  total  amounts  still  open  would  be 
reduced by EUR 63 million to EUR 40 million. In a number of other cases, Germany 
has challenged the Commission’s decisions before the Court of First Instance. 

launched the  procedure of 

ESF 

Out of the original 48 ESF mainstream Operational Programmes for 1994-1999, 22 
are  now  fully  closed.  Four  further  ESF  programmes  were  closed  in  2007  and  the 
outstanding commitment (RAL) for mainstream programmes is now EUR 39 million. 
However,  ESF  closures  for  1994-1999  remain  a  concern,  given  the  German 
objections to the  Commission’s proposals in several  cases,  combined  with  the  high 
number  of  “irregularities”  (open cases)  declared.  For  a  further  15  Community 
Initiative Programmes, there are still outstanding commitments of EUR 21.3 million, 
because  of  contention  of  the  calculation  of  the  closure  payments.  A  financial 
correction procedure needs to be launched for these programmes. 

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46 

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EAGGF 

As  regards  the  EAGGF,  all  German  programmes  for  the  period  1994-1999  are 
closed.  Recoveries  have  been  made  for  several  Objective  1  and  Leader  II 
programmes, due to irregularities and OLAF cases amounting to EUR 1.388 million.

EN 

47 

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5. 

DENMARK 

2000-2006 programming period 

5.1. 

Objective 2 

For the programming  period  2000-2006, there was  one  Objective  2  Programme  for 
Denmark.  The  funding  for  the  programme  initially  totalled  EUR  617  million,  of 
which  EUR  197  million  from  the  Structural  Funds  (EUR  29  million  is  for 
phasing-out regions), EUR 217 million from the national public sector (an increase 
of EUR 9 million compared to the initial allocation) and EUR 194 million from the 
private sector (a decrease of EUR 30 million). 

The  programme  aimed  to  create  the  conditions  for  self-sustained  growth  in  the 
regions  of  Denmark  facing  structural  problems.  It  combined  actions  under  the 
European Regional Development Fund (ERDF) (71%) and the European Social Fund 
(ESF) (29%). 

The  eligible  areas  consisted  of 
five  geographical  sub-regions:  Bornholm 
(Objective 2), Lolland, Falster and Møn (Objective 2), Nordjylland (Objective 2 and 
phasing-out), parts of the counties of Viborg, Århus, Ringkøbing and Sønderjylland 
(Objective  2  and  phasing-out)  and  Sydfyn  and  islands  not  covered  by  the  above 
regions (Objective 2). 

There were no meetings in the Programme (PMC) in 2007. There were two hearings 
organised in 2007, one regarding the annual report for 2006 and the other concerning 
a change in the Nordjylland Programme Complement.  

Work  in  2007  was  dominated  by  two  major  tasks.  One  was  the  closure  of  the 
2000-2006  programme,  including  a  process  to  reallocate  ERDF  funding  that  had 
been granted to projects but was not used up as intended and therefore was available 
for 
the 
2007-2013 programme. 

programme.  The 

implementation 

task  was 

other 

the 

of 

ERDF 

By the end of 2007, the Commission had paid out EUR 115 million, approximately 
81% of the total allocation. In addition, around EUR 9.5 million was in the pipeline 
for payment, which was enough to meet the requirements under the “n+2” rule. 

The actual execution of the ERDF part of the programme was as follows: 

A  total  of  1309  ERDF  projects  received  grants  amounting  to  approximately 
EUR 129 million,  including  technical  assistance,  accounting  for  around  92%  of  the 
total  ERDF  allocation  to  the  programme.  Payments  to  projects  amounted  to 
approximately EUR 115 million, including technical assistance. Almost a third of all 
projects  concerned  support  for  investment  in  businesses.  The  measure  that  has 
absorbed  the  largest  amount  of  money  is  infrastructure  investment  in  the 
development of the regions. 

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48 

   EN 

ESF  

By  the  end  of  2007,  the  Commission  had  paid  out  EUR  39  million,  approximately 
72% of the total allocation. In addition, around EUR 3 million was in the pipeline for 
payment,  although  this  was  not  enough  to  meet  the  requirements  under  the  “n+2” 
rule.  The  ESF  has  supported  901  projects,  under  which  almost  22  000  persons 
(47% of them women) have participated in competence development. 

The  ESF  part  of  the  programme  has  helped  to  create  new  education  and  training 
courses  and  bolstered  cooperation  between  education  institutions  in  the  regions. 
Furthermore, the ESF projects have helped to make company training planning more 
systematic  and  to  develop  new  courses  and  new  ways  of  cooperation  between 
education institutions and enterprises. 

5.2. 

Objective 3 

For  the  programming  period  2000-2006,  there  is  one  Objective  3  programme  for 
Denmark.  Funding  initially  totalled  EUR  757.9  million,  with  EUR  378.9  from 
the ESF.  After  allocation  of 
the  Structural  Fund 
contribution  amounts  to  EUR  394.8  million,  plus  EUR  294.3  million  from  the 
national  public  sector  (an  increase  of  EUR  9.5  million  compared  to  the  initial 
allocation)  and  EUR 100.9  million  from  the  private  sector  (an  increase  of 
EUR 6.7 million). 

the  performance  reserve, 

The  programme  supports  active  labour  market  measures,  the  labour  market 
integration  of  vulnerable  unemployed  persons,  the  development  of  employee 
competencies and entrepreneurship. 

There were  no  meetings  of  the Programme  Monitoring Committee (PMC) in  2007. 
The  annual  report  for  2006  was  processed  by  written  procedure  and  the 
annual meeting between the managing authority and the Commission was carried out 
through an exchange of letters. 

By the end of 2007, the Commission had paid out EUR 277 million from the ESF, 
which  was  70%  of  the  total  allocation.  Moreover,  a  payment  of  approximately 
EUR 43  million  was  in  the  pipeline.  However  this  was  not  enough  to  meet  the 
requirements under the “n+2” rule. The ESF Objective 3 programme has supported 
4109  projects  with  137  000  participants,  50%  of  them  women.  Priorities  absorbing 
the  largest  shares  of  funding  are  support  for  competence  development  and  support 
for entrepreneurship.  

5.3. 

Fisheries outside Objective 1 

The total FIFG allocation, including the reserve, to the country-wide Danish fisheries 
programme is EUR 213.3 million. The main measures, in line with the reform of the 
Common  Fisheries  Policy,  are  scrapping  of  vessels,  processing  and  marketing, 
collective investments and innovative measures. 

Implementation  has been  rather slow and the “n+2” rule had to be applied in  2004 
and 2005. The programme met its “n+2” target for 2006. In total, the programme has 
so  far  been  reduced  by  EUR  24.1  million.  Financial  execution  has  reached  79% 

EN 

49 

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(EUR 150.1 million out of EUR 189.1 million). A decommitment of EUR 6.5 million 
is anticipated for “n+2” in 2007. 

5.4. 

Community Initiatives 

5.4.1.  Equal 

The  Danish  EQUAL  programme  has  supported  62  projects  in  total,  with 
9 800 participants (62% of them women). By the end of 2007, the Commission had 
paid  out  EUR  20  million,  which  was  66%  of  the  total  allocation.  In  addition,  a 
payment of approximately EUR 4 million was in the pipeline, although this was not 
enough  to  meet  the  requirements  under  the  “n+2”  rule.  The  National  Thematic 
Networks  are  all  in  place.  The  two  most  active  networks  are  Integration  of 
immigrants and refugees and Adaptability. 

5.4.2.  Leader 

The  total  public  allocation  for  the  Danish  Leader+  Programme  2000-2006  was 
increased  in  2004  following  indexation  and  now  amounts  to  EUR  34.6  million, 
including  an  EU  contribution  of  EUR  17.3  million.  The  programme  was  amended 
in 2006  when  a  transfer  of  funding  between  priorities  was  approved  in  order  to 
ensure more efficient use of funds.  

The programme has progressed well. Payments in 2007 amounted to EUR 3 million. 
A total of EUR 12.7 million had been paid out by the end of 2007, giving a rate of 
financial  execution  of  73.4%  of  the  amount  available  for  the  programming  period 
2000–2006. 

5.4.3.  Urban 

The  Århus  URBAN  II  programme  is  the  only  one  in  Denmark.  The  ERDF  will 
contribute a total of EUR 5.38 million to this programme, for which the total eligible 
costs amount to EUR 12.1 million.  

The  managing  authority  for  the  programme  is  the  Danish  Agency  for  Trade  and 
Industry,  while  the  functional  day-to-day  management  is  delegated  to  the 
URBAN Secretariat in Århus. The monitoring committee met once during 2007. 

The “n+2” rule was met in 2007. 

Overall comments concerning the 2000-2006 period  

The  URBAN  programme  successfully  contributes  to  all  three  dimensions  of  the 
Lisbon  Strategy.  On  the  economic  side,  it  has  helped  to  initiate  and  stimulate 
entrepreneurial culture, education and IT development. Along the social dimension, 
the programme contributes to employment efforts, equality, social protection through 
citizen  involvement,  empowerment  and  crime  prevention.  Its  environmental 
contribution is exemplified by the project “Hasle Bakkelandskab”. 

5.5. 

Closure of the period 1994-1999 

All programmes were closed before the end of 2004. 

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50 

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6. 

GREECE 

2007-2013 programming period 

2007 was a challenging year for Greece due to both the start of the new programming 
period and the near end of the 2000–2006 period. Focal points of the year were the 
negotiations  and  approval  of  the  NSRF  and  the  thematic  and  regional  OPs  for  the 
period 2007–2013. In terms of the 2000-2006 programmes, attention centred on the 
“n+2” situation.  

The National Strategic Reference Framework for Greece for 2007–13 was submitted 
the  Greek  authorities  on  26  January  2007.  Following  a  series  of 
by 
technical meetings,  the  decision  on  the  NSRF8  was  taken  on  28  March  2007. 
In the new programming period, Greece contains eight Convergence, three phasing-
out and two phasing-in regions. The new programming period reduces the number of 
regional  operational  programmes  from  thirteen  to  five,  with  all  but  one  regional 
operational programme covering three regions. 

Ten of the Greek ERDF Operational Programmes for 2007–2013 were submitted on 
3  March  2007.  There  are  five  regional  programmes  and  five  thematic  programmes 
(of which  two  also contain financing from the Cohesion Fund),  including  technical 
assistance.  Following  negotiations  with  the  Greek  authorities,  all  ten  programmes 
were adopted in October and November 2007. 

These ten Operational Programmes reflect the priorities of the Commission, the main 
target  priority  being  the  Lisbon  Growth  and  Jobs  priorities.  60.5%  of  funding  has 
been  earmarked  for  these  activities,  reflecting  60.2%  of  funds  in  the  Convergence 
objectives  and  68.3%  in  Regional  Competitiveness  and  Employment  regions. 
Aspirations to make use of JEREMIE and JESSICA have been included in a number 
of  OPs,  and  the  first funding  agreement for JEREMIE was signed on 26 June 2007 
with the EIF. 

are 

sectoral 

programmes 

The  ESF  will  co-finance  three  sectoral  Operational  Programmes  and  a  National 
Contingency  Reserve  programme  during  the  programming  period  2007-2013. 
The three 
“Human  Resources  Development”, 
“Education and  Lifelong  Learning”  and  “Administrative  Reform”.  The  Greek 
authorities submitted the drafts of the three sectoral programmes on 6 March 2007. 
in 
Following negotiations  with 
November 2007.9 The draft National Contingency Reserve OP was submitted to the 
Commission  on  4 October  2007.  The  negotiation  and  adoption  processes  for  this 
programme  are  still  running,  the  aim  being  adoption  by  the  end  of  July  2008 
at the latest. 

the  Greek  authorities, 

they  were  adopted 

The  three  sectoral  programmes  respond  to  the  Lisbon  objectives  and  the 
European Employment  Strategy.  Overall,  96.52%  (EUR  4  058.7  million  out  of 
EUR 4  205  million)  of  their  resources  are  earmarked  for  actions  under  the  main 

8 
9 

C(2007) 1389. 
AROP:  C(2007)5528,  9/11/2007,  HRD  OP:  C(2007)5534,  12/11/2007,  Education  and  LLL: 
C(2007)5534, 12/11/2007. 

EN 

51 

   EN 

                                                 
to  Regulation  (EC)  No  1828/2006,  which 

headings  of  Annex  II 
the 
Implementing Regulation  for  the  Funds  during  the  2007-2013  period.  Furthermore, 
96.56%  of  their  resources  allocated  to  convergence  regions  (EUR  3  937.34  million 
out  of  EUR 4 077.40  million)  and  95.57%  of  their  resources  allocated  to 
competitiveness  and  employment 
(EUR  121.97  million  out  of 
regions 
EUR 127.63 million) are earmarked for actions under the above headings. 

is 

Seven new ERDF major projects were adopted in 2007.  

2000-2006 programming period 

6.1. 

Objective 1 

In the 2000–2006 period, the 13 regions of Greece were all under Objective 1.  

in 

in  Western  Greece 

the  Peloponnese  and 

The summer of 2007 was marked by wildfires in the regions of Attica in July, and on 
in  August. 
mainland  Greece, 
The destruction  was  extensive  and  a  national  state  of  emergency  was  declared  on 
25 August. President Barroso and Commissioner Hübner visited the affected areas to 
survey the damage at the end of August. A technical meeting was held in Athens on 
7  September  to  discuss  the  legal  and  financial  aspects  of  an  extension  of  the 
deadlines  of  the  programmes  and  initiatives.  In  accordance  with  Articles  14(2)  and 
30(2)  of  Council  Regulation  (EC)  No  1260/1999,  due  to  significant  changes  in  the 
socio-economic situation, on 19 December 2007, the Greek authorities wrote to the 
Director-General  of  DG  Regional  Policy  to  request  an  extension  of  the  regional 
programmes in the affected areas and the national programmes directly affected by 
the wildfires. Following agreement with the Commission, the final date of eligibility 
will  be  extended  for  the  regional  programmes  concerned  and  the  requests  for  an 
extension  for 
the  national  programmes  affected  will  be  examined  on  a 
case-by-case basis. 

In  the  first  half  of  2007,  DG  REGIO  representatives  participated  in  a  meeting  in 
Athens on the application of Community public procurement legislation by Greece. 
There was a hearing on the application of the mathematical formula.  

In  2007,  EUR  2  978  670  418  of  ERDF  payments  and  EUR  761  738  759  of 
ESF payments for the 2000–2006 period were made. There were no decommitments 
to the  Operational  Programmes under  the “n+2” rule, but the Community Initiative 
URBAN  may  face  an  “n+2”  reduction  of  EUR 1 327 522  for  2005  commitments. 
Recoveries  of  EUR 150 383 811.81  were  made  in  2007,  with  EUR 150 000 000 
being  due  to  Commission  Decision  C(2005)  1731  of  17  May  2005,  whereby 
EUR 518 million is to be recovered in stages between 2005 and 2008. There were no 
recoveries made in 2007 for the ESF. 

EUR  1  911  874  622  of  ERDF  commitments  and  EUR  648  706  520  of 
ESF commitments were made for the 2007–13 period. 

The  annual  reports  for  all  ERDF  Operational  Programmes  for  2006  were  approved 
by the monitoring committees by written procedure and were received and approved 
by  the  Commission.  All  but  one  Operational  Programme  submitted  a  request  for 
changed,  which  will  be  processed  in  the  course  of  2008.  Only  three  OPs  did  not 
submit  a  revised  Programme  Complement  and  two  OPs  submitted  2  revised 

EN 

52 

   EN 

Programme  Complements  in  the  course  of  the  year.  Overall,  taking  into  account 
revisions  submitted  last  year,  23  revisions  of  Programme  Complements  were 
approved.  Only  the  Operational  Programme  “Roads”  held  a  monitoring  committee 
meeting. 

EAGGF 

The  national  mono-fund  EAGGF  Guidance  Section  programme  for  Greece  was 
approved by the Commission on 6 April 2001. The Community contribution to this 
programme  is  EUR  1  233.4  million  for  a  total  cost  of  EUR  3  010.2  million. 
On 24 November  2004,  the  Commission  approved  the  decision  for  the  mid-term 
revision  of  this  programme,  which  included  an  additional  amount  of  EUR  250  000 
from the programming and performance reserves. An additional modification of the 
programme  was  made  on  7  December  2006,  without  however  any  impact  on  total 
EU co-funding.  

The thirteen regional multi-fund programmes approved during the first half of 2001 
and  last  amended  on  7  December  2006  amount  to  a  total  EAGGF  contribution  of 
EUR 1  069  million.  All  programming  complements  were  adopted  by 
the 
monitoring committees by written procedure.  

Due  to  the  extensive  fires  that  took place  in  Greece  in  the  summer  of  2007,  which 
affected  —  among  others—  rural  infrastructure,  forestry  and  private  investment  in 
rural areas, Greece submitted a request to the Commission in autumn 2007 to extend 
the date of eligibility of the national mono-fund EAGGF Guidance programme and 
the  four  pluri-fund  regional  OPs  of  the  affected  areas  of  Attica,  Mainland  Greece, 
Peloponnese and Western Greece mentioned above to 31 December 2009. 

In  2007,  payments  reached  EUR  583.300  million.  Cumulative  payments  from  the 
EAGGF  Guidance  Section  since  the  start  of  the  2000-2006  programming  period 
(EUR 2 020.832 million) account for 73.85% of the planned budget. 

Fisheries 

Implementation  of  the  FIFG  Objective  1  “Fisheries”  Operational  Programme  (OP) 
for Greece continued in 2007. Payments have been regularly submitted, albeit with a 
peak  towards  the  end  of  the  year.  The  programme  in  2007  may  face  an  “n+2” 
reduction  of  approximately  EUR  9 718  million  for  2005  FIFG  commitments. 
Generally  speaking,  the  pace  of  implementation,  compared  to  previous  years, 
was slower. 

As  in  previous  years,  the  monitoring  committee  met  in  2007.  This  meeting  was 
needed to discuss the relevant aspects of the Operational programme, to examine the 
problems and to propose appropriate measures. 

The contract level at the end of 2007 was around 83% while the payments level was 
69% of total public expenditure. 

EN 

53 

   EN 

6.2. 

Community Initiatives 

6.2.1.  Equal 

In 2007, payments of EUR 21 334 072 were made for EQUAL. 

6.2.2.  Leader 

There 
is  only  one  Leader+  programme  for  Greece,  which  was  approved 
on 19 November  2001  with  a  total  cost,  following  the  2004  indexation  exercise,  of 
EUR 368.700  million,  EUR  186.130  million  of  which  is  the  contribution  from  the 
EAGGF  Guidance  Section.  The  programme  was  last  amended  in  November 2006. 
A request  for  extension  of  the  date  of  eligibility  was  also  submitted  for  Leader+ 
following  the  extensive  fires  that  affected  Greece  during  the  summer  of  2007. 
For 2007, payments amount to EUR 35.154 million. Cumulative EAGGF payments 
from the start of the 2000-2006 programming period (EUR 132.500 million) account 
for 71.19% of the total budget of the programme. 

6.2.3.  Urban 

There  are  three  URBAN  II  programmes  in  Greece.  The  programmes  for  Perama, 
Komotini and Iraklio were approved at the end of 2001. Recent modifications were 
made  to  the  programmes  of  Perama  (approved  in  November  2006)  and  Komotini 
(approved in October 2006), while Iraklio received approval in September 2006 for 
its modification to the programme complement. The total eligible cost for the three 
programmes is EUR 34.1 million. The total EDRF contribution is EUR 25.6 million. 
Perama, which did not benefit from indexation, receives EUR 9.25 million from the 
ERDF, Komotini EUR 8.15 million and Iraklio EUR 8.185 million. The total budget 
for Perama is EUR 12.34 million, for Komotini EUR 10.867 million and for Iraklio 
EUR 10.914 million.  

Annual  reports  on  implementation  during  2006  were  submitted  in  accordance  with 
Council Regulation (EC) No 1260/1999. 

For  all  three  programmes,  the  managing  authority  is  the  national  government 
(Ministry for Environment, Physical Planning and Public Works).  

Two  programmes,  Perama  and  Iraklio,  did  not  meet  the  “n+2”  rule  at  the 
end of 2007.  

Overall comments concerning the 2000-2006 period in Greece 

The  programmes  have  already  contributed  to  substantially  upgrading  of  the  area 
receiving  assistance  and  the  quality  of  life  of  its  inhabitants,  who  are  aware  of  the 
programme and its contribution to the upgrading of the city, in particular in Komotini 
(East Thrace) and Iraklio (Crete). The learning process of the URBAN II integrated 
approach  is  seen  as  positive  in  Greece  and  could  contribute  in  the  future  to 
significant changes in national urban policy-making. 

EN 

54 

   EN 

6.3. 

Closure of the period 1994-1999 

One  programme  from  1994-1999  was  still  to  be  closed,  the  OP  “Access  and  Road 
Axes”.  A  hearing  procedure  for  this  OP  took  place  on  22  March  2007. 
The Commission  informed  the  Greek  authorities  of  its  conclusions  by  letter  dated 
14 May 2007 and received supplementary information and clarifications by letter of 
29  June  2007.  On  7  December  2007,  the  Commission  sent  the  Greek  authorities  a 
letter proposing a correction of approximately EUR 18 million and a final payment 
of EUR 31 million. 

EN 

55 

   EN 

7. 

SPAIN 

2007-2013 programming period 

The  National  Strategic  Reference  Framework  (NSRF), 
Cohesion Fund  Operational 
Operational Programmes were approved in 2007. 

Programmes 

(OPs) 

the  23  ERDF  and 
ESF 

the 

22 

and 

Commission  Decision  C(2007)  1990  on  the  NSRF  was  adopted  on  7  May  2007. 
It provides 
of 
EUR 23 057 192 151,  EUR 8 057 328 822  and  EUR 3 543 213 008  respectively, 
broken down over the following priority axis: 

and  Cohesion  Fund 

for  ERDF,  ESF 

contributions 

(1) 

(2) 

(3) 

knowledge  economy  development:  research,  development  and  innovation; 
information society; communication technologies; 

entrepreneurial development and innovation; 

environment;  natural  environment;  water  resources  management;  risks 
prevention; 

(4) 

transport and energy; 

(5) 

local and urban sustainable development; 

(6) 

social infrastructure; 

(7) 

(8) 

fostering  entrepreneurship  and  employees’,  enterprises’  and  entrepreneurs’ 
adaptability; 

fostering employability, social inclusion and equal opportunities between men 
and women; 

(9) 

increasing and improving human capital; 

(10) 

transnational and interregional cooperation. 

Cohesion 

Fund-ERDF 

knowledge-based 

Four  of  the  ERDF  and  CF  OPs  cover  more  than  one  region  (RTDI  for  and  by 
and 
economy, 
enterprises, 
Technical Assistance) while the other 19 cover single regions or cities. As for ESF, 
there  are  3  multi-objective  OPs  (Adaptability  and  Employment,  Fight  Against 
Discrimination  and  Technical  Assistance  and  Transnational  Cooperation)  and 
19 regional  OPs.  Distribution  by  objective 
full 
Convergence regions  (Andalucía,  Castilla-La  Mancha,  Extremadura  and  Galicia), 
four  phasing-out  regions  and  cities  (Asturias,  Murcia,  Ceuta  and  Melilla), 
three phasing-in regions (Canarias, Castilla y León and Valencian Community) and 
eight  full  Regional  Competitiveness  and  Employment  regions  (Aragón,  Baleares, 
Cantabria,  Cataluña,  Madrid,  Navarra,  País  Vasco  and  la  Rioja).  The  main 
achievements of the negotiating process are as follows: 

follows: 

four 

as 

is 

EN 

56 

   EN 

–  Doubling of resources earmarked for RTDI compared to the current period (over 
EUR 6-8 billion for the period 2007-2013 compared to less than EUR 4 billion in 
the 2000-2006 period). This is despite an over 40% loss of funds compared to the 
period 2000-2006. Some actions are flagged up as EU pilot initiatives, such as the 
new “Technology Fund” with EUR 2 billion.  

–  A  new  urban  policy  approach,  providing 

the  current 
URBAN Community  Initiative,  has  been  adopted.  This  includes  a  nation-wide 
action  for  integrated  urban  development,  with  project  selection  based  on  a 
competitive call for proposal. 

follow-up  of 

–  A more strategic planning role for the national authorities, over and above sound 
financial and administrative management, in the form of the establishment of six 
“thematic”  networks  in  key  intervention  areas  (Innovation,  R&D,  Urban  Policy, 
Equal  opportunities,  Environment  and  Social  Inclusion)  for  the  exchange  of 
good practice  among  national  and 
regional  administrations  and  greater 
institutional collaboration. 

–  A  further  step  towards  a  regional  approach,  placing  greater  emphasis  on 
partnerships  and  public-private  collaboration,  covering  in  particular  innovative 
actions for financial engineering (Jeremie and Jessica).  

–  Gender  equality  has  been  mainstreamed,  and  the  programmes  pay  increased 
attention to vulnerable groups: insertion of immigrants was not a key priority in 
the  2000-2006  programmes,  whereas  in  the  new  period  EUR  218  million  is 
allocated to specific actions to bolster the participation of migrants in the labour 
market.  There  has  been  a  shift  towards  a  more  holistic  approach,  tailor-made 
measures  replacing  separate  training  schemes  by  in  the  form  of  pathways  to 
employment. 

–  There has been a shift in education from palliative action for early school leavers 

to preventive action to reduce early school leaving. 

–  Lifelong learning is clearly a key theme for the ESF in Spain, with an allocation 
of 17% of ESF aid. The National Reform Programme (NRP) and the Commission 
paper entitled “Strategic Objectives and Key issues for Spain” identified the low 
cover  rate  of  continuous  training  as  a  challenge  that  had  to  be  addressed. 
To this end, more attention is paid to reaching SME workers. 

There  is  a  strong  link  to  the  NRP,  with  Lisbon  earmarking  targets  well  above  the 
targets established in Regulation (EC) No 1083/2006 for the combined operation of 
the 23 ERDF and 22 ESF Operational Programmes. 

2000-2006 programming period 

7.1. 

Objective 1 

The  average  financial  execution  for  Objective  1  as  a  whole  is  quite  positive. 
The current execution rate for the ERDF, compared to the amount programmed for 
2000-2006, is 82% and the amount executed has reached EUR 20 842 million out of 
the  EUR 25 359 million  committed  for  this  Objective  in  Spain  for  the  period. 
is  89.36%,  with  an  amount  of 
The current  execution  rate  of 

the  ESF 

EN 

57 

   EN 

EUR 8 127 million  (including  advance  payments)  being  reached  out  of  the 
EUR 9 095 million committed by the ESF for this objective in Spain for the period 
2000-2006 (EUR 7 508 million, excluding advance payments).  

Looking  at  the  level  of  performance  by  priority  axes,  “Infrastructures  for  human 
resources  development”,  “Transport  and  energy”,  “Local  and  urban  development” 
and  “Competitiveness”  have  an  execution  rate  higher  than  the  average  for  all 
programmes,  while  “R&D  and  Information  society”,  “Environment  and  natural 
resources”  and  “Rural  development”  priority  axes  are  slightly  below  the  average 
execution rate. 

As  far  as  major  projects  are  concerned,  a  total  of  100  decisions  confirming  the 
Community participation rate had been approved by the end of 2006. No new major 
projects  were  approved  during  2007,  although  eight  aid  requests  for  major  projects 
were being examined by the Commission in 2007. 

operational 

Spain faced the possibility of losing funds for the first time because of the automatic 
funds  not  duly  covered  by  certified  expenses  before 
decommitment  of 
31 December 2007.  The 
the 
Research, Development  and  Innovation  OP  (EUR  7.3  million)  and  the  URBAN 
Programme for Orense (EUR 111 000). The loss is limited as a result of a series of 
measures  proactively  taken  in  those  programmes  where  a  risk  situation  had  been 
observed following the mid-term reviews carried out and subsequent measures taken 
by  the  managing  authority  to  minimise  the  risks  of losses due  to application of the 
“n+2” rule. Two modifications were made to operational programmes and eleven to 
programme complements during 2007. 

programmes 

concerned 

are 

However, as a vast operation of controls have been launched for several intermediate 
bodies,  following  the  findings  of  the  Commission  audits,  significant  amounts  were 
decertified  from  several  intermediate  bodies  (IBs),  and  a  “hold”  practiced  by  the 
certifying authority, which avoided certifying expenses from IBs that did not comply 
100%  with  the  regulatory  requirements.  Generally,  this  is  also  the  reason  why  the 
overall  target  of  making  payments  of  EUR 3 200 million  was  not  met  and  was 
limited  to  EUR 2 199 million  (including  Objective  1,  Objective  2  and  URBAN  for 
the period 2000-2006). As for the ESF, there was automatic decommitment under the 
“n+2”  rule  concerning  the  2005  annual  commitment  of  the  OP I+D,  for  a  total 
amount of EUR 15 121 832.29.  

As  in  previous  years,  a  total  of  18  monitoring  committee  meetings  were  organised 
in 2007, as well as meetings of the CSF Committee. These meetings were essential to 
discuss the relevant aspects of each programme, to examine potential problems and 
to  take  appropriate  measures,  including  financial  transfers  within  the  same  priority 
axes. 

A  total  of  18  annual  reports  (with  ERDF  participation)  were  submitted  by  the 
managing  authority  in  2007.  In  many  cases,  the  Commission  made  comments 
designed to improve the quality of the initial versions. After analysing their contents, 
the Commission accepted them all. 

EN 

58 

   EN 

In  2007,  there  were  no  annual  meetings  concerning  2006.  Due  to  the  intense 
preparation  of  the  2007-2013  programming  period,  only  a  written  procedure  was 
launched in early 2008. 

Looking at the global impact of the Community Support Framework since 2000, and 
at  the  results  of  recent  evaluations,  its  contribution  the  real  growth  is  estimated  at 
0.28  percentage  points  per  year,  which  is  equivalent  to  2.03%  for  the  whole 
2000-2006  period.  In  terms  of  employment,  the  CSF  is  estimated  to  have  helped 
create  or  maintain  about  255  000  jobs  over  that  same  period.  The  ERDF,  which 
covers  60.84%  of  the  CSF,  can  thus  be  said  to  have  contributed  62.14%  of  the 
increase in real growth and 58.04% of the impact on employment. 

EAGGF 

Monitoring  data  regarding  the  EAGGF  Guidance  section  show  that  at  the  end  of 
2007  Spain  had  reached  an  execution  rate  of  92.8%.  The  regions  with  the  best 
programmes  in  terms  of  execution  performance  were  Castilla  Leon,  Cantabria, 
Extremadura and Murcia. 

Fisheries inside Objective 1 regions 

As for the FIFG in Objective 1 regions, a modification of the OP was adopted by the 
Commission  on  14.03.2007.  This  modification  was  meant  to  adapt  programmed 
funding rates to actual practice in anticipation of the application of recently adopted 
closure guidelines. 

Financial  execution  reached  almost  84%  by  the  end  of  the  year,  with  no  “n+2” 
automatic  decommitment,  since  payments  during  2007  exhausted  the  funds 
committed before the end of 2005.  

The OP and SPD monitoring committees met only once, on 20 June 2006 in Madrid, 
to approve their respective annual execution reports, which were then forwarded in 
good time to the Commission.  

Implementation problems of specific relevance to the FIFG in Spain were discussed 
at  a  number  of  technical  meetings  and  at  the  annual  meeting  in  Brussels  on 
28 January  2008,  while  issues  of  general  relevance  to  OPs  for  Objective 1  regions 
were dealt with during the annual encounter for the Spanish CSF. 

7.2. 

Objective 2 

The  average  financial  execution  for  Objective  2  is  very  positive.  The  current 
execution  rate,  compared  to  the  amount  programmed  for  2000-2006,  is  78.8%  and 
the  amount  executed  has  already  reached  EUR 2 013 million,  out  of 
the 
EUR 2 554 million committed for this Objective in Spain for the period. The current 
execution 
is 
total  amount  of 
EUR 268 million(including  advance  payments),  out  of  a 
EUR 310 million committed for the ESF in Spain under this objective for the period 
2000-2006 (EUR 245 million, excluding advance payments). 

the  amount  executed 

is  86.45%  and 

the  ESF 

rate 

for 

No automatic decommitment for ERDF had been applied under the “n+2” rule as at 
31 December 2007. 

EN 

59 

   EN 

As  in  previous  years,  the  monitoring  committees  of  the  seven  SPDs  met  once 
in 2007.  These  meetings  were  concluded  by  written  procedures  in  several  cases,  in 
particular  for  the  modifications  of  the  SPDs  and  programming  complements. 
Annual reports  for  the  seven  interventions  were  submitted  on  time  and  were 
examined  by  the  Commission  and  the  monitoring  committees.  The  quality  of  the 
initial  Objective  1  reports  was  acceptable,  but  the  Commission  made  comments 
designed to complete the content in the final versions. Two modifications were made 
to operational programmes and eight to programme complements during 2007. 

7.3. 

Objective 3 

for 

the 

five 

regional  and 

thematic,  multiregional  programmes).  The 

The  CSF  for  Objective  3  is  implemented  through  twelve  operational  programmes 
total 
(seven 
Community contribution for these twelve programmes is EUR 2 316 million for the 
period  2000-2006.  Of  this,  EUR  919  million  is  for  the  regional  programmes  and 
EUR  1 397  million 
and  multiregional  programmes. 
thematic 
These programmes are designed to support the development and improvement of the 
systems of vocational training, the insertion and reinsertion of unemployed people in 
the labour market, the promotion of the participation of women in the labour market, 
the  fight  against  sexual  discrimination,  the  insertion  in  the  labour  market  of 
disadvantaged  people,  and  the  promotion  of  entrepreneurship  and  lifelong  learning 
for  employed  people.  The  global  balance  of  implementation  in  2007  was  quite 
positive.  Both  physical  and  financial  execution  may  be  qualified  as  very  positive. 
The  financial  execution  rate  reached  92.82%  for  the  twelve  programmes,  which 
amounts to EUR 2 142 685 515.19, out of a total amount programmed for 2000-2006 
for this objective in Spain of 2 308 473 268.4. The current execution rate is 91.11% 
for the regional and 93.95% for the multiregional programmes  

In  2007,  there  were  no  automatic  decommitments  under  the  “n+2”  rule  from  the 
2005  annual  commitments  for  Objective  3  programmes.  As  in  previous  years,  the 
monitoring committees for each of the twelve programmes met in 2007, in particular 
to  examine  the  annual  execution  reports.  After  being  analysed  by  the  different 
monitoring committees, the reports were presented to the Commission in good time, 
and  accepted.  At  the  end  of  2007  discussions  on  the  annual  meetings  for  the 
multiregional  and  thematic  programmes  were  conducted  by  written procedure. 
There was  no  monitoring  committee  meeting  for  the  CSG  in  2007  due  to  the 
preparation and adoption of the ESF 2007-2013 programming documents. 

7.4. 

Fisheries outside Objective 1 

For regions outside Objective 1, financial execution had reached almost 80% by the 
end  of  2007.  There  was  no  automatic  decommitment  pursuant  to  the  “n+2”  rule  as 
the  last  payment  request,  which  had  been  posted  just  before  the  end  of  2007, 
exhausted all the funds committed before the end of 2005. 

A  modification  of  the  Single  Planning  Document  (SPD)  for  regions  outside 
Objective 1 was adopted by the Commission on 14.03.2007. This modification was 
meant  to  adapt  programmed  funding  rates  to  actual  practice  in  anticipation  of 
application of the recently adopted closure guidelines. 

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7.5. 

Community Initiatives 

7.5.1.  Equal 

Actions  under  the  Spanish  EQUAL  programme  proceeded  without  any  major 
difficulties  in  2007.  At  the  end  of  2007,  the  rate  of  financial  execution  of  the  ESF 
part of the programme was approximately 82% of the total. The financial plan of the 
programme  was 
amended  by  Commission  Decision  C(2007)6843  of 
22 December 2007,  due  to  the  automatic  decommitment  for  2004.  In  2007, 
automatic decommitment  was  avoided.  Mainstreaming  and  thematic  activities 
continued  in 2007, projects for Action 3  were selected and closing meetings of the 
Thematic Groups were held. Evaluation of mainstreaming and innovation is ongoing. 

7.5.2.  Leader 

By  the  end  of  2002,  the  Commission  had  approved  eighteen  Leader+  programmes 
(one  horizontal  programme  and  seventeen  regional  programmes),  with  a  planned 
EU contribution 
the 
502.06  million 
indexation exercise).  

2000-2006 

of  EUR 

(after 

for 

Seventeen  programmes  are  currently  implemented  via  global  grants  and  one 
(Basque Country)  in  the  form  of  a  common  Operational  Programme  with  a 
programme  complement.  One  hundred  and  forty-five  Local  Action  Groups  (LAGs) 
have  been  created.  The  total  area  covered  by  the  LAGs  is  251 186  km2,  covering 
14% of the entire national population. 

From the official monitoring data available at end 2007, the rate of interim payment 
is 72.5% of forecast expenditure.  

Eighteen  annual  reports  were  submitted  in  2007  and  examined  by  the  monitoring 
committees  and  the  Commission.  The  quality  of  the  reports  was  considered 
acceptable. 

During 2007 the Commission amended three programmes in order to decommit that 
part of the funds committed in 2004 but not settled at the end of 2006 (“n+2” rule). 
The main  reason  behind  this  decommitment  was  the  late  start  of  the  programmes. 
Eight financial plans were adjusted in the course of 2007 (changes within the same 
axis to improve efficiency). 

7.5.3.  Urban 

There are ten Community Initiative Programmes in Spain, with an EU contribution 
of EUR 114.1 million, which accounts for 15% of the total URBAN II budget for the 
period 2000-2006. 

The  Spanish  URBAN  II  Community  Initiative  programmes  are  being  implemented 
steadily,  in  accordance  with  the  original  programming.  All  ten  programmes 
submitted admissible annual implementation reports for 2006 in June 2006. There is 
only  one  programme  (Orense)  that  did  not  meet  the  level  of  payments  required  to 
avoid application of the “n+2” rule at the end 2007. 

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The  managing  authority  for 
Management and implementation were delegated to the local authorities. 

the  programmes 

is 

the  Ministry  of  Finance. 

Overall comments for the 2000-2006 period 

Focusing  on  a  single  area,  combined  with  the  strong  local  partnership  and  the 
participation of several agencies in the decision-making procedure, has ensured that 
URBAN projects run smoothly and are sustainable. 

Project monitoring is being carried out effectively.  

7.6. 

Closure of the 1994-1999 programming period 

At the end of 2007, the following three ERDF programmes still remain open (out of 
a total of 106), with outstanding commitments (RAL) of EUR 4 395 423.58:  

–  DOCUP  5b  País  Vasco  (RAL:  EUR  114  120.04):  pending  validation  of 

Commission Decision by Legal affairs unit (REGIO.B.3),  

–  PO Medio Ambiente (RAL: EUR 2 199 785), and  

–  PIC  REGIS  España-Canarias  (RAL:  EUR  1  967  440):  awaiting  a  ruling  by  the 

Spanish courts. 

As  for  the  ESF,  remaining  outstanding  commitments  of  EUR  5.1  million  were 
awaiting a ruling by the Spanish courts at the end of 2007. This concerns the three 
programmes of INEM Objective 3, Catalonia Objective 2 and Catalonia Objective 3, 
which  were  suspended  by  decision  under  Article  24  of  Regulation  4253/88 
(Commission Decision C(2001) 2146 of 22.10.2001).  

the 

regards 

As 
the 
closure  of  1994-1999  programmes 
EAGGF-Guidance Fund,  the last  eleven  open  programmes  were  finally  closed  in 
2007  and  the  final  decommitment  will  be  made  after  adoption  of  the  Decision  on 
financial corrections. However, there are still ongoing audit procedures, which might 
also result in financial corrections for several programmes. 

assisted  by 

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8. 

ESTONIA 

2007-2013 programming period 

A first draft National Strategic Reference Framework (NSRF) was submitted by the 
Estonian  authorities  in  March  2006.  The  informal  negotiations  for  Estonia’s  NSRF 
were concluded with the submission of the official NSRF by the Estonian authorities 
on  1  March  2007.  In  2007  the  Commission  took  its  decision  on  the  NSRF  and 
adopted the OPs. 

The NSRF is closely related to the Estonian National Reform Programme; it covers 
three OPs, two of which are ERDF/CF and one ESF. The managing authority for all 
OPs  is  located  within  the  Ministry  of  Finance  of  Estonia.  The  total  EU  budget  is 
EUR 3 403 million. The NSRF core targets refer to achieving fast as well as socially 
and  regionally  balanced  sustainable  economic  development,  which  in  turn  should 
help to achieve real convergence.  

The  main  challenges  for  2008  include  the  development  of  selection  criteria  for  the 
operations  supported,  the  selection  of  major  projects  and  the  actual  start  of 
implementation  of  the  2007-2013  programming  period  in  order  to  meet  the  n+3 
requirement in 2011. To date, slow progress has been noted in this regard. 

2000-2006 programming period 

Estonia, an Objective 1 NUTS II country, has been able to finance eligible operations 
from  the  Structural  Funds  since  1  January  2004,  with  ERDF  funding  of 
EUR 226 million  and  ESF  funding  of  EUR  69  million,  out  of  the  total  of 
EUR 371 million  for  the  Objective  1  Structural Funds.  The  SPD  identifies  the  core 
problems of Estonia (low GDP, unemployment, disparities) and sets out the overall 
objective  of  “fast  and  regionally  balanced  sustainable  economic  development”, 
mainly by shifting into higher value-added production. The SPD strategy is based on 
four  priorities  (excluding  technical  assistance):  (i)  Human  Resource  Development, 
(ii)  Enterprise  Competitiveness,  (iii)  Agriculture,  Fisheries  and  Rural  Development 
and  (iv) Infrastructure  and  Local  Development.  The  SPD  (Structural  Funds)  is 
coordinated  by  the  Foreign  Financing  Department  of  the  Ministry  of  Finance 
(i.e. managing  authority).  The  paying  authority  and  the  audit  body  are  the 
Departments  of  National  Fund  and  Financial  Control  respectively,  in  the  same 
ministry.  There  is  one  monitoring  committee  and  each  priority  is  monitored  by  the 
“Priority Working Group”. 

8.1. 

Objective 1 

Achievement of Objectives 

The  Estonian  2004-2006  Objective  1  programme  has  partly  contributed  to  the  high 
growth  rate  in  Estonia.  Unemployment  decreased  from  10.2%  in  2004  to  4.9% 
in 2007 (national data). Cohesion Policy has  facilitated the transfer towards a more 
knowledge-intensive  economy  and  provided  the  necessary  infrastructure  for  the 
expansion of economy.  

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3  200  new  jobs  were  been  created,  8  500  unemployed  persons  received  training, 
12 700  workers  received  on-the-job  training,  and  400  new  enterprises  were  created 
with the support of the funds. In addition, 5 800 modern student places were created 
in  vocational  training  centres,  and  91  000  persons  benefited  from  improved  local 
government services in their neighbourhood (data as at the end of 2006).  

In  addition,  the  programmes  have  had  an  effect  on  softer  issues,  such  as  the 
introduction of an evaluation culture, the raised level of audit quality (evidenced also 
through  the  signature  of  the  contract  of  confidence  for  ERDF  between  the 
Commission  and  the  Estonian  authorities),  increased  management  and  project 
planning  capacity,  and  increased  levels  of  administrative  capacity  at  sub-national 
level. 

The  commitment  levels  (in  terms  of  approved  applications  in  the  Estonian 
monitoring  system)  had  reached  93%  at  national 
in  March  2008. 
The payment levels  to  beneficiaries  are  satisfactory  for  most  measures  and  covered 
almost 80% of the programme. In 2007, the Commission paid EUR 73.5 million to 
Estonia from the ERDF. It should be noted that Estonia has no “n+2” issues and the 
requisite levels of funding utilisation were reached by the end of 2007.  

level 

Monitoring committee meetings 

Two  monitoring  committee  meetings  were  held  in  2007.  The  Committees  include 
participants from all state institutions involved and also from civil society. 

Annual meeting 

The  2007  annual  meeting  between  the  Commission  and  the  Estonian  managing 
authority  was  organised  in  January  2008,  due  to  the  heavy  workload  preparing  for 
the  new  period  at  the  end  of  the  previous  year.  The  annual  meeting  covered  the 
progress of programme implementation, preparation of the 2007-2013 programming 
period and management and audit issues. 

The  quality  of  implementation  and  the  administrative  capacity  of  the  Estonian 
managing  authority  and  implementing  bodies  was  monitored  regularly,  while  also 
being the subject of several technical discussions (in the MC or in connection with 
preparing for the new period) during 2007, along with issues such as the capacity of 
local  authorities  (financial,  technical  and  administrative)  to  prepare  for  larger 
projects,  mobility  of  staff,  rising  construction  prices,  rising  prices  in  the  field  of 
training and better forecasting of pricing in technical design. Three main issues were 
identified  as  important  for  monitoring  in  the  new  period:  staffing  and  mobility, 
procurement  rules  and  projects  pipeline.  Another  issue  is  the  technical  capacity  of 
final beneficiaries, e.g. of local authorities. 

8.2. 

Community Initiatives  

8.2.1.  Equal 

The Estonian EQUAL programme proceeded without any major difficulties in 2007. 
There are thirteen Development Partnerships funded under the EQUAL Community 
Initiative. At the end of 2007, the rate of financial execution of the ESF part of the 

EN 

64 

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programme  was  67%.  Automatic  decommitment  under  the  “n+2”  rule  was  avoided 
for 2007. No amendments were made to the programme. 

8.2.2.  Leader 

Estonia has implemented the Leader approach through the measure “Local initiative -
based  development  projects  -  LEADER”,  as  part  of  the  Estonian National 
Development  Plan  for  2004–2006.  The  measure  was  implemented  through  two 
options:  acquisition  of  skills  (whereby  local  development  strategies  were  prepared) 
and integrated rural area development strategy (the strategies were implemented).  

Local  Action  Groups  applied  for  support  under  the  Leader  measure  at  the  end  of 
2006.  By  the  beginning  of  2007,  24  LAGs  had  been  chosen.  Twenty-one  groups 
received support to prepare local development strategies and three groups started to 
implement 
their  existing  strategies.  Total  support  was  EEK  28.8  million 
(EUR 1.84 million). 

A Leader Information Centre  was  established as a support structure for the groups. 
In 2007, Local Action Groups covered 181 out of 194 local government units in rural 
areas,  i.e.  approximately  93%  of  the  total  rural  area.  In  addition,  around 
1000 villages  elected  non-official  village  representatives  (out  of  a  total  of  over 
4000 villages). About 700 local societies were involved in village development. 

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65 

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9. 

FRANCE 

2007-2013 programming period 

the  other  22  metropolitan  regions  are  now  covered  by 

The 2007-2013 Convergence Objective in France covers the four French outermost 
regions.  All 
the 
Competitiveness  and  Employment  Objective.  For  each  Convergence  and 
Competitiveness  Region,  a  Regional  programme  was  adopted  during  2007. 
In addition,  four  multiregional  programmes,  two  for  mountain  areas  (Alps  and 
Massif  Central)  and  two  for  river  basins  (Loire  and  Rhone)  were  also  adopted. 
A national  programme  provides  technical  assistance  and  IT  management  for  all 
programmes. The total number of French programmes is 31. 

Negotiations for the 2007-2013 period programmes focused on the concentration of 
financial  resources  in  a  reduced  number  of  priorities  of  the  Lisbon  strategy. 
At the end  of  negotiations,  the  earmarking  rate  for  France  was  78,6%  for 
competitiveness and 62% for convergence regions. 

Research and Innovation is the main priority in almost all Regional Competitiveness 
and  Employment  programmes.  The  vast  majority  of  French  regions  committed 
themselves  to  improving  their  regional  strategy  for  innovation  by  way  of  an 
ambitious  exercise  to  be  carried  out  in  conjunction  with  the  Commission, 
the French authorities and international experts, which should be finalised two years 
after programme adoption. The programmes also seek to improve the employability 
of workers through the promotion of lifelong learning. 

Environment  and  risk  prevention  and  information  technologies  follow  in  the 
priorities  chosen  by  the  regions.  Some  regions  also  proposed  measures  on  urban 
policy,  integrated  in  global  strategies.  Territorial  projects  are  still  found  in  some 
regions, in Brittany, for instance, with a major project of a TGV connecting Rennes 
and  Quimper  to  Brest.  A  certain  weakness  in  the  indicators  was  also  noted  in  the 
proposals 
improvements  were  made 
during negotiations. 

for  programmes,  but 

significant 

A  national  seminar  focusing  on  Innovation  and  the  anticipation  of  economic  and 
social  changes  was  co-organised  by  the  Commission  and  French  authorities  in 
Bordeaux, and a large audience (over 750 participants) highlighted the importance of 
this issue in the 2007-2013 programming period. 

2000-2006 programming period 

9.1. 

Objective 1 and 2 

The  2000-2006  Objective  1  in  France  covers  the  four  French  outermost  regions10 
the 
and, 
North/Pas de Calais region.  

support,  Corsica 

transitory 

districts 

under 

three 

and 

of 

10 

Guadeloupe, Guyane, Martinique, Réunion. 

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Objective  2  concerns  21  of 
from  metropolitan  France. 
Four national programmes  concerning  technical  assistance  and  IT  management  add 
to the 27 regional programmes. 

the  22 

regions 

2007  was  marked  by  several  modification  decisions  (decommitments,  financial 
modifications)  to  prepare  for  closure.  All  regions  worked  on  the  preparation  and 
negotiation of the new period programmes. 

Average programming at the end of December 2007 (all Structural Funds together) 
to  98.4%  for 
to  100.0%  for  Objective  1  regions  and  up 
increased  up 
Objective 2 regions.  

The  executed  payments  rate  under  Objective  1  was  82.38%  from  the  ERDF  and 
86.43%  from  the  EAGGF  (Guidance).  87.61%  was  paid  from  the  ERDF  under 
Objective 2.  

Decommitments of the 2005 commitment (available up to 31 December 2007) were 
limited for the ERDF to the national programme for IT management Objective 2 and 
technical assistance Objective 2. No decommitments were registered for the EAGGF 
Guidance Section. 

31 annual reports were received on implementation in 2006 of the Objectives 1 and 
2. An analysis of the reports confirms the overall improvement in content, although 
financial 
significant  differences 
information  are  complete  but  the  qualitative  analyses  of  the  programmes  should  be 
improved, in particular as regards quantified indicators. 

regions.  Accounting  and 

remain  between 

The  high  error  rates  observed  following  the  national  French  audit  results  puts  the 
programmes at risk of possible suspension. 

9.2. 

Objective 3 

The French Objective 3 programme is a national programme but implementation is 
highly  devolved  to  all  the  regions.  The  total  appropriation  for  Objective  3  is 
EUR 4 918  million.  The  average  programming  as  at  15  December  2007  was  94%. 
At the end of 2007, 75.52% of this budget (EUR 3 714 042 039) had been paid out 
by  the  Commission.  The  2007  annual  meeting  between  the  Commission  and  the 
French managing authorities took place on 7 December 2007. 

The year 2007 was important in terms of final reprogramming, spurred mainly by the 
need to optimise the allocation of funds in order to eliminate any “n+2” risks at the 
end  of  the  period,  and  to  allow  optimal  reprogramming  of  the  agreed  financial 
correction  (EUR  110  million).  In  financial  terms,  at  the  end  of  2007,  the  average 
programming was 85% of the total and the rate of execution of the ESF part of the 
programme  was  61.37%.  The  programme  was  unable  to  avoid  a  decommitment  of 
EUR 12.951 576 of the 2005 commitment.  

9.3. 

Fisheries outside Objective 1 

In France, the FIFG continues to be implemented in line  with  the objectives of  the 
reformed Common Fisheries Policy and the need to improve this sector. Execution is 
running  well,  both  in  terms  of  implementation  and  in  terms  of  projects  committed. 

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Thus,  all  French  maritime  regions  are  engaged  in  implementation  of  the  fisheries 
structural policy. The sum of the declarations of expenditure at the end of 2007 came 
to a total of EUR 861 million, of which EUR 205 million from the FIFG, i.e. 84% of 
the  FIFG  reserve.  Altogether,  more  than  EUR  1 000  million  has  been  invested  or 
committed in 9 183 projects with support from the FIFG, 30% of the projects being 
in Brittany. 

France  therefore  exceeded  84%  of  its  allocation  in  terms  of  reimbursement 
(EUR 205  million  from  the  FIFG),  with  a  globally  very  good  execution  rate  and 
shorter delivery delays. 

At the end of 2007, the number of projects with assistance from the FIGF was more 
than twice the number of projects for the whole of the previous programming period 
(1994-1999). 

9.4. 

Community Initiatives 

9.4.1.  Urban 

the 

The URBAN II programme in France consists of nine programmes being carried out 
following  cities/group  of  cities:  Bastia,  Bordeaux/Cenon/Floirac, 
in 
Clichy-sous-Bois/Montfermeuil,  Grenoble,  Grigny/Viry-Chatillon,  Le  Havre, 
Le Mantois,  Les  Mureaux/Val-de-Seine,  Strasbourg.  Four  of  the  nine  programmes 
(Clichy,  Le  Mantois,  Grigny  and  Val-de-Seine)  are  located  in  the  Ile  de  France 
region,  with  an  ERDF  contribution  of  EUR  51  million.  In  total,  nine  programmes 
received  an  amount  of  EUR  284.6  million,  of  which  EUR  102  million  from 
the ERDF. 

The  annual  reports  for  2006  were  submitted  to  the  Commission  on  all  the 
nine programmes and all of them met their “n+2” objectives for 2007. 

In  the  majority  of  cases,  the  mayor  or  the  president  of  the  inter-commune 
(four programmes)  cooperation  structure  fulfils  the  role  of  the  managing  authority, 
while the regional perfect plays this role for three programmes. The latter two cases 
concern  both  a  public  corporation  and  a  public  interest  grouping  chaired  either 
by the mayor  or  by  the  prefect.  In  each  case,  the  paying  authority  is  the 
Caisse des Depots et Consignes. 

Overall comments concerning the 2000-2006 period in France 

In  general,  the  French  programmes  made  good  use  the  added  value  of  URBAN  II 
programmes.  They  support  the  participation  of  citizens,  of  local  associations  and 
inter-commune  cooperation.  In  addition,  in  2002  the  nine  French  URBAN  II 
programmes,  supported  by  the  partners  representing  the  state  (the  Interministerial 
Delegation to the City — DIV, the Interministerial Delegation to Planning and to the 
Competitiveness  of  the  Territory  —  DIACT,  the  Deposit  Bank  —  CDC)  created 
‘URBAN  Network  France’,  whose  aim  is  to  pool  and  share  good  practices, 
knowledge and experiences, in an effort to optimise the management of URBAN II 
programmes in France. 

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9.4.2.  Equal 

In  financial  terms,  average  programming  was  85%  of  the  total  at  the  end  of  2007. 
However, the programme was unable to avoid a decommitment of EUR 12 951 576 
of the 2005 commitment.  

The  French  managing  authorities  organised  a  forum  on  combating  discrimination 
based  on  origin,  bringing  together  270  participants  from  18  Member  States. 
The platform  highlighted  the  need  for  professional  stakeholders,  the  importance  of 
intermediaries,  the  promotion  of  best  practice,  the  recognition  of  immigrants’ 
specific pathways towards the labour market and international exchanges. 

9.4.3.  Leader 

The French National Programme in the Community Initiative Leader+ was adopted 
on  7  August  2001  (C(2001)2094)  in  the  form  of  a  global  grant.  Accordingly,  the 
National Centre for the Setting-up of Farming Structures (CNASEA) was designated 
as the management authority. The total Community contribution, initially amounting 
to  EUR  272  834  444,  was  set  at  EUR  263  611  385  by  Commission  Decision 
C(2006)2039  of  16  May  2006.  By  Commission  Decision  C(2007)3542  of 
17 July 2007,  the  EAGGF  (Guidance)  contribution  to  this  programme  was  reduced 
by  EUR  3  702  304.  As  at  31  December  2007,  the  Community  contribution  was 
EUR 259 909 081.  

The  programme  is  implemented  by  one  hundred  and  forty  Local  Action  Groups 
(LAGs),  which  were  selected  in  2002.  Their  action  plans  were  drawn  up  in  2003, 
after signature of bilateral agreements with CNASEA. 

Payments reached EUR 47 124 756 in 2007. The level of expenditure incurred meant 
there was no “n+2” decommitment.  

Financial  implementation  since  2001  has  reached  a  total  of  EUR  184.5  million, 
which amounts to 71% of the total Community contribution to the programme. 

9.5. 

Closure of the 1994-1999 programming period 

Balance  requests  continued  to  be  processed  during  2007.  The  outstanding 
commitment (RAL) of the ERDF was reduced to nearly zero during 2007 (compared 
to EUR 693.9 million before examination of the final reports and balance requests on 
1 January 2003).  

For the EAGGF (Guidance), the RAL was reduced by EUR 3.41 million during the 
year and was down to zero on 31 December 2007. 

The last OP to be closed, Ile de la Reunion, is waiting for further information from 
the French authorities and should also be closed shortly. 

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10. 

ITALY 

2000-2006 programming period 

10.1.  Objective 1 

Budgetary execution 

According  to  the  official  monitoring  data  as  at  31  December  2007  provided  by  the 
Italian  authorities,  the  average  commitment  rate  on  total  eligible  expenditure 
(at CSF level) is 111% and the average payment rate on total eligible expenditure is 
79.8% (all Structural Funds together).  

The  ERDF  commitment  rate  is  114.5%  and  the  payment  rate  is  80.0%.  As  regards 
the EAGGF Guidance section, the monitoring data provided by the Italian Ministry 
of Economy and Finance show a commitment rate of 100.9% and a payment rate of 
79%. 

ERDF  programmes  performing  the  best  in  financial  terms  are  the  national 
programmes  for  “Education”  (96.1%)  and  “Local  development”  (payment  rate: 
91.9%).  At  regional  level,  the  best  performing  programmes  in  financial  terms  are 
“Molise” (87.5%) and “Basilicata” (82.9%). The programmes performing the poorest 
in  financial  terms  are  the  regional  programmes  for  “Sicilia”  (73.8%),  “Campania” 
(74.4%),  “Puglia”  (74.5%)  and  the  national  programme  for  “Research”  (75.6%). 
The best  performing  EAGGF  programmes,  according  to  the  end-of-year  data  for 
2007,  are  the  three  regional  programmes  of  Molise  (85.4%),  Calabria  (79.8%)  and 
Basilicata (78.5%). 

As  far  as  the  FIFG  is  concerned,  financial  implementation  of  the  national  fisheries 
programme  (PON  Pesca)  as  at  31  December  2007  had  reached  93%  in  terms  of 
commitments  on  total  eligible  expenditure  and  68%  in  terms  of  payments  on  total 
eligible expenditure. At regional level, the best performing programmes in terms of 
FIFG  are  “Campania”  (87.2%),  “Calabria”  (76.2%)  and  “Molise”  (75.4%). 
The programmes  performing  the  poorest  in  financial  terms  are  the  regional 
programmes for “Puglia” (65.6%), “Sicilia” (65.1%) and “Sardegna” (49.2%). 

ESF shows a higher payment rate (80.7%), with a lower commitment rate (104.4%). 
On  average,  national  programmes  perform  significantly  better  than  regional  ones 
(at the  end  of  2007,  payment  rate  of  89.6%  against  77.5%),  the  best  performing 
programme being the OP “Research” (payment rate of 91.8%). 

With  respect  to  the  “n+2”  rule  at  the  end  of  2007  for  ERDF,  a  decommitment  is 
envisaged for the “Sardegna” programme  of  around  EUR  11.3  million  and  also  for 
two  URBAN II programmes  (Misterbianco  and  Taranto)  for  EUR  0.06  million  and 
EUR  2.4  million  respectively.  The  ERDF  decommitment  proposal  for  Sardegna  is 
due  to  differences  in  interpretation  of  application  of  the  “n+2”  rule  by  the 
Italian authorities. No decommitment is envisaged under the “n+2” rule at the end of 
2007 for ESF OPs. 

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As regards the “n+2” rule at the end 2007 for the FIFG, a decommitment of around 
EUR  10.4  million  is  envisaged  for  the  national  OP  for  fisheries  (PON  Pesca), 
together  with  approximately  EUR  2.4  million  for  “Puglia”,  EUR  4.1  million  for 
“Sardegna”,  EUR  0.3  million  for  “Molise”  and  EUR  0.7  million  for  “Calabria”. 
The FIFG decommitment for Puglia and Sardegna is due to insufficient expenditure 
by  the  end  of  the  year,  while,  for  PON  Pesca,  Molise  and  Calabria,  the 
decommitment  is  due  to  the  late  transmission  of  the  respective  payment  requests, 
i.e. beyond the 31 December deadline. 

Overall results of programme implementation throughout the programming period 

Although  information  on  results  and  impacts  is  still  scarce,  outputs  are  becoming 
closer to definitive values and can provide evidence of the effort and effects of the 
use of Structural Funds. In particular: 

–  In  the  environmental  services  sector,  progress  has  been  made  in  separate  waste 
collection:  9 000 000  people  more  have  access  to  it  thanks  to  Structural  Funds 
assistance and 63 new waste treatment plants have been put into operation. 

–  Moreover,  wastewater 

about 
7 200 000 inhabitants (equivalent) due to new or upgraded plants co-financed by 
the  ERDF,  in  parallel  with  the  upgrade  of  sewage  networks  (890  km  of  new 
pipelines). 

increased 

treatment 

capacity 

has 

by 

–  The water cycle has also been boosted through action on primary water (3097 km 

of new aqueducts). 

–  A huge effort in soil protection has been made: the hydro-geological risk has been 
reduced  over  an  area  of  876 526  km²  and  438  hectares  have  been  reclaimed  by 
decontamination. 

–  Environmental  actions  were  complemented  by  projects  on  sustainable  energy: 
more  than  5839  plants  for  Renewable  Energy  Sources  received  contributions, 
mostly  in  the  solar  field  (5821);  in  addition,  1028  operations  concerning  energy 
efficiency were funded. 

–  R&D  and  competitiveness:  the  productive  sector  has  largely  benefited  from 
ERDF assistance:  19 983  enterprises  received  support  (including  202  start-ups). 
In addition,  R&D  projects  involving  931  enterprises  were  funded,  along  with 
769 cooperation 
enterprises. 
Some 82 research centres were also increased in capacity. 

between 

research 

projects 

centres 

and 

–  Transport infrastructure was further developed, priority being given to sustainable 
modes  of  transport,  with  the  construction  of  2401  km  of  railways,  692  km  of 
roads, and 4 km of new docks. 

–  The  Information  Society  was  extended:  588  municipalities  were  connected  to 
broadband,  425  e-government  tools  for  enterprises  were  put  into  practice  and 
7255 enterprises took advantage of new IT services/tools. 

–  Some improvements were made in public employment services. 

EN 

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As  regards  the  EAGGF  Guidance  section,  substantial  progress  has  been  made  in 
investments  in  agricultural  holdings  to  improve  the  processing  and  marketing  of 
agricultural products. 

Another significant result concerns the progress made in Objective 1 regions in the 
field  of  administrative  capacity  and  governance,  which  is  a  pre-condition  for 
effective results in other sectors. 

Programme amendments, subjects covered at the annual meeting and the meetings of 
the monitoring committees 

Programme modifications 

8 proposals for programme amendments have been submitted by Italy for Objective 
1  programmes  (“Puglia”,  “Local  development”,  “Molise”  (2),  “Campania”, 
“Calabria”  and  “Sardegna”(2));  6  decisions  have  been  adopted  to  date.  The  main 
financial 
for  amending  programmes  was  sound  management  and 
reason 
implementation at the end of the programming period (amendment of allocations by 
priority  axes).  The allocation  between  funds  and  programmes  was  left  unchanged. 
A new  amending  decision  was  also  adopted  for  PON  Pesca  following  the  “n+2” 
decommitment at the end of 2006. 

Annual meeting 

In  2007,  a  single  Annual  Meeting  was  held  in  L’Aquila  for  Objectives  1  and  2; 
this was regarded as being good practice and will be continued. The agenda included:  

–  2006 annual reports;  

–  financial execution and application of the “n+2” rule;  

–  resources from projects financed by national sources;  

–  setting-up of monitoring committees and transitional phase 2000-2006/2007-2013; 

–  preparation of 2007-2013 programming period.  

Meetings of monitoring committees 

Monitoring committee meetings for all programmes, excluding Sardegna, took place 
once  or  twice  during  the  year:  while  they  all  examined  the  usual  issues  linked  to 
implementation, 
amendment  of  programmes 
(financial reprogramming)  for  sound  management  reasons  (complete  absorption  of 
funds at the end of programming period). More emphasis was placed on the results of 
Structural Funds assistance. 

issue  was 

the  main 

the 

10.2.  Objective 2 

Budgetary execution 

According  to  the  official  monitoring  data  as  at  31  December  2007  provided  by  the 
Italian  Authorities,  the  average  commitment  rate  on  total  eligible  expenditure  is 
111.8% and the average payment rate on total eligible expenditure is 88.1%. 

EN 

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The  SPDs  performing  the  best  in  financial  terms  are  “Valle  d’Aosta”  (133.9%), 
“Veneto”  (106.1%)  and  “Emilia  Romagna”  (105.5%),  which  are  virtually  closed. 
The  SPDs  performing  the  poorest  in  financial  terms  are  “Abruzzo”  (75.1%)  and 
“Umbria” (79.5%). 

With  respect  to  the  “n+2”  rule  at  the  end  of  2007,  no  decommitment  is  proposed, 
confirming the positive financial absorption of 2005 and 2006. 

Overall results of programme implementation throughout the programming period 

Although  information  on  results  and  impact  is  still  scarce,  outputs  are  becoming 
closer to definitive values and can provide evidence of the effort and effects of the 
use of the structural funds. In particular: 

–  In  the  environmental  services  sector,  progress  has  been  made  in  separate 

waste collection: 372 000 people more have access to it. 

treatment 

–  Moreover,  wastewater 

about 
260 000 inhabitants (equivalent) due to new or upgraded plants co-financed by the 
ERDF,  in  parallel  with  the  upgrade  of  sewage  networks  (620  km  of  new 
pipelines).  In  total,  131  projects  regarding  waste  and  sewage  treatment  plants 
have been implemented.  

increased 

capacity 

has 

by 

–  Energy:  1  043  operations  concerning  renewable  sources  of  energy  have  been 
carried  out  (of  which  923  solar,  51  hydroelectric  59  biomass,  6  geothermal  and 
4 wind). 

–  R&D  projects 

involving  2  192  enterprises  were 

funded,  along  with 

299 cooperation projects between research centres and enterprises.  

–  Competitiveness: 94 000 enterprises have received support for their investments. 

–  Transport infrastructure was further developed, priority being given to sustainable 
modes  of  transport,  with  53  operations  on  multimodal  platforms  (680  000  m2), 
54 operations in ports and 782 m of new docks. 

–  The  Information  Society  was  extended:  79  municipalities  were  connected  to 

broadband, and 14 000 enterprises took advantage of new IT services/tools. 

Programme amendments, subjects covered at the annual meeting and the meetings of 
the monitoring committees. 

Programme amendments 

7 proposals for programme amendments have been submitted by Italy for Objective 
2  SPDs 
(“Toscana”,  “Bolzano”,  “Abruzzo”,  “Emilia-Romagna”,  “Veneto”, 
“Marche” and “Friuli-Venezia Giulia”). The main reason for amending programmes 
for Objective 2 was also sound management and financial implementation at the end 
of 
the  programming  period  (amendment  of  allocations  by  priority  axes). 
The allocation between programmes was left unchanged. 

EN 

73 

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Annual meeting 

In 2007, a single Annual Meeting was held in L’Aquila for Objectives 1 and 2. It was 
regarded as being good practice and will be continued. The agenda included:  

–  2006 annual reports;  

–  financial execution and application of the “n+2” rule;  

–  resources from projects financed by national sources;  

–  setting-up of monitoring committees and transitional phase 2000-2006/2007-2013; 

–  preparation of 2007-2013 programming period.  

Meetings of monitoring committees 

Monitoring committee meetings for all programmes took place once or twice during 
the year: while they all examined the usual issues linked to implementation, the main 
issue  was  the  programme  amendment  (financial  reprogramming)  for  sound 
management  reasons  (complete  absorption  of  funds  at  the  end  of  programming 
period). More emphasis was also placed on the results of Structural Funds assistance. 

10.3.  Objective 3 

Budgetary execution 

According  to  the  official  monitoring  data  as  at  31  December  2007  provided  by  the 
Italian  Authorities,  the  average  commitment  rate  on  total  eligible  expenditure  is 
102.05% and the average payment rate on total eligible expenditure is 86.64%. 

Some Operational Programmes are virtually closed. The ones performing the best in 
financial  terms  are  “Friuli  Venezia  Giulia”  (payment  rate  of  107.3%)  and  “Trento” 
(100.2%).  

With  respect  to  the  “n+2”  rule  at  the  end  of  2007,  no  decommitment  is  proposed, 
confirming the positive financial absorption throughout the financial period. 

Overall results of programme implementation throughout the programming period 

In the 2000-2006 programming period, the ESF has played an essential role in  

–  modernising  the  Employment  Public  Services,  which  in  most  Objective  3  areas 

can provide advanced and quality services;  

–  implementing active labour market policies for long-term unemployment; and  

–  improving  training  systems,  also  via  the  setting-up  of  a  certification  system  for 

training bodies. 

Implementation of the 2000-2006 Operational  Programmes has also fostered a new 
approach towards evaluation, which is now generally seen as a management tool for 

EN 

74 

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all public assistance, not only for co-funded projects. The ESF has also pursued and 
encouraged the development of the partnership principle at different levels. 

No programme amendments were submitted in 2007. 

The  Annual  Meeting  was  held  in  Rome  in  November.  Given  the  smooth 
implementation of the 2000-2006 Operational Programmes, it mainly focused on the 
preparation of the 2007-2013 programming period.  

Monitoring committee meetings for all programmes took place once or twice during 
the  year:  in  addition  to  standard  issues,  such  as  the  annual  implementation  reports, 
they addressed the drafts of the 2007-2013 Operational Programmes.  

10.4. 

Fisheries outside Objective 1 

According  to  the  official  monitoring  data  as  at  31  December  2007  provided  by  the 
Italian authorities,  the  FIFG  mono-fund  Single  Programming  Document  (SPD) 
commitment  rate  on  total  eligible  expenditure  has  reached  99.5%  and  the  payment 
rate on total eligible expenditure is 73.6%. 

With respect to the “n+2” rule, a decommitment was envisaged at the end of 2007 of 
around EUR 4.2 million. This is not due to poor financial absorption but to the late 
transmission  of 
the 
31 December deadline.  

the  end  of  year  payment 

i.e.  beyond 

request, 

The  FIFG  SPD  has  also  been  amended  with  a  view  to  sound  management  and 
financial  implementation  at  the  end  of  the  programming  period  (amendment  of 
allocations by priority axes). A monitoring committee meeting was held in July and 
dealt  mainly  with  analysing  implementation  levels,  amendments  to  programme 
complements in line with the final reprogramming decision, “n+2” forecasts and the 
state of play of information and publicity activities. 

10.5.  Community Initiatives 

10.5.1.  Equal 

The EQUAL Programme did not have any problems with the “n+2” rule in 2007. 

Payments in 2007 increased to EUR 69 897 918.81. To date, payments have risen to 
EUR 337 688 722 (total ESF contribution: EUR 401 364 808).  

After a few problems, implementation of final activities has progressed.  

10.5.2.  Leader 

There are 22 LEADER+ programmes in Italy, of which 21 regional programmes and 
to  a  Community  contribution  of 
one  national  programme,  amounting 
EUR 289.1 million for the period 2000-2006. 

From  the  official  monitoring  data  received  from  the  Italian  authorities,  on 
31 December 2007 the level of commitments stood at 90.6% of eligible expenditure 
and  the  actual  payments  made  amounted  to  75.2%  of  forecast  expenditure. 

EN 

75 

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Lombardia, Veneto and Piemonte were the best performing programmes in terms of 
financial execution, with an expenditure rate of more than 87% of allocated financial 
resources.  

In 2007, there were no decommitment decisions taken under the “n+2” rule was on 
Italian Leader+ programmes. However, the most recent data available show that two 
Italian  programmes  (Abruzzo  and  Puglia)  did  not  meet  the  “n+2”  target  for  2007 
itself. Decommitments of around EUR 1.9 million for Puglia and EUR 0.10 million 
for Abruzzo are therefore envisaged. 

In  2007,  four  programmes  were  amended  by  Commission  decisions  (Toscana, 
Piemonte,  Veneto  and  Liguria).  The  amendments 
financial 
programming adjustments.  

related 

to 

The 2007 annual reports for all programmes were received. The main achievements 
in  implementing  the  programmes  were  reviewed  by  the  Commission  with  the 
managing authorities as part of the 2007 annual review. The Commission asked Italy 
and  the  managing  authorities  of  the  Molise,  Liguria,  Valle  d’Aosta  and  Friuli 
Venezia Giulia programmes to improve the quality of the annual reports as regards 
the quantification of monitoring indicators and description of control activities. 

All  programmes  showed  significant  progress  in  the  implementation  of  measures, 
particularly  as  regards  Axis  1  (support  for  rural  development  strategies,  integrated 
and pilot actions), which was almost completed. Some progress was made on Axis 2 
(inter-territorial  and  transnational  cooperation),  but  implementation  still  lagged 
behind due to a number of complex technical issues. 

Monitoring  committees  (MC)  for  the  programmes  were  regularly  convened. 
During the  MC  meetings  the  programmes  and  related  programming  complements 
were  reviewed  and  updated, 
the 
programmes. 

thus  ensuring  correct 

implementation  of 

10.5.3.  Urban 

All  the  ten  URBAN  II  Programmes  for  Italy  were  adopted  by  the  Commission  in 
November 2001 and amended in 2006. The total eligible cost of all ten URBAN II 
programmes is EUR 268 010 837, with an EU contribution of EUR 116 535 331 and 
EUR 17 006 545 from the private sector. 

The managing authority of each Italian URBAN II Programme is the municipality of 
the city. The monitoring committees are therefore chaired by the Town Council and 
organised  at  local  level,  one  for  each  programme,  and  include  both  institutional 
bodies  and  environmental  and  social-economic  partners.  Inhabitants  and  local 
partners are thus often directly involved in programme design and implementation.  

Annual reports on implementation for the year 2006 were submitted in June 2007. 

Two  Italian  programmes  (Taranto  and  Misterbianco)  did  not  meet  the  “n+2”  rule 
for 2007.  

EN 

76 

   EN 

Overall comments for the 2000-2006 period 

Most  of  the  Italian  URBAN  programmes  have  been  very  successful  in  their 
achievements  and  management.  However,  some of them ran into serious problems, 
which  delayed  implementation.  There  were  no  problems  with  meeting  the 
programme  outputs.  Experience  has  demonstrated  that  a  local  authority-led  project 
can be a successful model for locally-based regeneration. 

10.6.  Closure of the 1994-1999 programming period 

All  the  1994-1999  ERDF  programmes  have  been  closed  (8  of  them  only  partly). 
Projects  have  been  suspended  for  judicial  proceedings  in  seven  programmes,  for 
which  the  current  outstanding  commitment  (RAL)  is  zero.  Four  programmes  have 
been  subject  to  a  financial  correction  decision  under  Article  24  of  Regulation 
4253/88. The 1994-1999 RAL was reduced by 87% (i.e. EUR 41 million — from 47 
to 6 million). 

All  59  ESF  files  were  processed.  Currently,  the  RAL  (outstanding  commitments) 
amounts  to  approximately  EUR  40  million  and  is  entirely  due  to  legal  and/or 
administrative  disputes  at  national  level,  which  also  considerably  delayed  the 
winding-up process. It will be possible to reduce this RAL gradually as soon as the 
legal action is resolved. 

As  regards  EAGGF  programmes,  only  eight  still  remained  open  at  the  end  of  the 
year. “Article 24” decisions have to be taken for all of these programmes. 

EN 

77 

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11. 

IRELAND 

2007-2013 programming period 

For  the  2007-2013  programming  period,  Ireland  is  no  longer  eligible  under  the 
Convergence  objective  (formerly  Objective  1).  The  Border,  Midland  and 
Western Region  (BMW)  are  “natural effect”  regions  as  its  GDP  per  capital  already 
the  new 
exceeds 
Regional Competitiveness  and  Employment  objective.  The  Southern  &  Eastern 
Region  (S&E),  having  already  completed  the  transition  from  Objective 1  in  the 
2000-2006 programming  period,  is  eligible  only  for  the  main  Competitiveness  and 
Employment objective.  

“phasing-in” 

the  EU-15 

average. 

status 

It has 

to 

The organisation surrounding the NSRF in Ireland is based on a bottom-up approach, 
with  the  regional  authorities  organising  local/regional  meetings  with  the  local 
partnerships  and drafting the ERDF OPs. The Department of Enterprise, Trade and 
Employment  (DETE),  responsible  for  the  ESF,  has  widely  consulted  with  social, 
equality  and  labour  market  institutions  to  draw  up  the  first  drafts  of  the  ESF  OPs. 
The two regions, together with the DETE as part of the ex ante evaluation, have also 
commissioned extensive needs analyses and various foresight studies to prepare the 
new period. The Commission took its decision on the Irish NSRF on 27 July 2007. 

The strategic focus of NSRF assistance is on the following themes and priorities for 
the European Regional Development Fund (ERDF): 

–  innovation, knowledge and entrepreneurship; and 

–  consolidating 

the  competitiveness,  attractiveness  and  connectivity  of 

the 
National Spatial  Strategy  (Gateways  and  Hubs)  through  improved  access  to 
quality infrastructure and promoting environmental and sustainable development, 
including a coherent and balanced approach to regional development.  

For  the  ESF,  the  NSRF  indicates  a  single  priority,  which  will  be  implemented 
through two corresponding priorities in the ESF OP: 

–  Human  Capital  Investment  through  upskilling  the  workforce  and  increasing  the 

participation and activation of groups outside the workforce. 

These  themes  are  being  implemented  through  three  Operational  programmes: 
ERDF OPs for the S&E and BMW regions, and one ESF Human Capital Investment 
(HCI) OP, together amounting to EUR 750 million of Structural Funds. The BMW 
and  S&E  Operational  Programmes  were  approved  by  the  Commission  on 
16 October 2007,  the  ESF  OP  on  6 November 2007.  On  18  December  2007,  the 
HCI OP  was 
Innovation  Policy, 
Michael Ahern,  T.D.  The  launch  was  followed  by  the  Inaugural  Programme 
monitoring  committee  meeting.  In 
the  first 
advance payment of EUR 7 507 247 was made on 22 November 2007. 

terms  of  financial  execution, 

launched  by 

the  Minister 

formally 

for 

EN 

78 

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2000-2006 programming period 

11.1.  Objective 1 

Implementation  of  the  ERDF  in  the  five  Irish  Objective  1  programmes  — 
Economic &  Social  Infrastructure,  Productive  Sector  (PSOP),  Technical  Assistance 
(TAOP),  Border,  Midland  &  Western  (BMW)  Region  and  Southern  &  Eastern 
(S&E) Region — continued at a satisfactory pace in 2007. Similarly, implementation 
of  the  ESF-funded  EHRD  OP  and  the  ESF-funded  childcare  measures  in  the  two 
regional OPs were also on schedule. 

The impact of the Structural Funds contribution in the first two CSFs (1989-1993 and 
1994-1999) is estimated to have raised GNP by 3% to 4%. The Structural Funds for 
2000-2006  have  played  an  important  role  in  Ireland,  both  in  the  S&E  and  in  the 
BMW  regions,  fostering  of  research,  development  and  innovation  and  boosting 
information society capacity. In the period 2000-2006, the ERDF will have spent an 
estimated  EUR  260  million  on  research,  technical  development  and  innovation  and 
the information society. During the 2000-2006 period, Irish research and innovation 
capacity increased significantly, in particular in the S&E region, setting the basis for 
technology-based economy developments in the years to come.  

Similarly strong impacts can be observed in the field of human resources, which has 
been a vital area of ESF assistance since 1989. While, in the years preceding 2000, 
investment boosted education and skills levels with a strong focus on young people 
while  at  the  same  time  enhancing  the  employment  prospects  of  the  unemployed, 
funding  in  the  2000-2006  programming  period  has  placed  increased  emphasis  on 
responding  to  shortages  through  targeted  supply-side  initiatives  in  education  and 
training.  A  good  example  of  this  development  is  the  emphasis  on  in-company 
training and support for a number of lifelong learning schemes. 

ERDF  payments  were  submitted  with  a  peak  towards  the  end  of  the  year. 
All payments to PSOP, BMW and S&E were temporarily interrupted while awaiting 
receipt of additional information on the Annual Implementation Reports. Use of the 
funds  has  been,  generally  speaking,  fluid.  The  BMW  payment  claim  of 
21 December 2007  is  under  scrutiny  by  the  Commission  owing  to  possible  “n+2” 
implications.  

ERDF  payments  amounted  to  EUR  72.6  million  in  2007,  and  have  reached  the 
ceiling  of  95%  for  three  of  the  programmes,  i.e.  PSOP,  TA  and  S&E.  Payments 
represent 93.89% and 71% for ESIOP and BMW respectively. 

and 

In general terms, the management does deliver on the projects and the concomitant 
spending,  although  certain  significant  cost  overruns  have  been  identified  over  this 
period 
certain  measures  —  Waste  Management,  E-Commerce 
(Local Infrastructure Priority) and Tourism (all ERDF co-funded) — for the regional 
programmes have been progressing more slowly than other measures. However, even 
these measures are now performing much more satisfactorily than was previously the 
case. 

The situation regarding payments is similar to the ESF position: payments amounted 
to  95%  of  the  total  Social  Fund  allocation  to  the  EHRD  OP  and  the  BMW OP. 

EN 

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Payments  for  the  S&E  OP  came  close,  reaching  84%.  ESF  payments  for  2007 
amounted to EUR 114 million. 

EAGGF 

The  revised  EAGGF-Guidance  section  amounts  to  EUR  153.6  million.  Cumulative 
EAGGF (Guidance) payments to the  end  of  2007  amount  to  EUR  133.8  million  or 
87.11% of the amount scheduled for the programming period 2000-2006..  

EAGGF  Guidance  will  not  contribute  to  the  two-year  extension  of  the  PEACE  II 
operational  programme,  jointly  managed  with  Northern  Ireland.  Therefore,  the 
EUR 12.6 million  EU  contribution  to  the  programme  was  not  increased.  Up  to  the 
end of 2007, total expenditure for the PEACE II programme was EUR 43.5 million, 
99.3% of the budget of EUR 44 million for the years 2000-2004. 

FIFG 

EC  payments  for  PSOP  amounted  to  64%  of  the  total  FIFG  allocation  for  the 
programme  by  31  December  2007.  For  the  aquaculture  measures  of  the  S&E  and 
BMW programmes, EC payments amounted 86% and 72% respectively. 

Monitoring committee meetings 

the  Commission.  Several  horizontal  working  groups 

Monitoring  committee  meetings  were  held  for  all  programmes,  with  participation 
(environment, 
from 
equal opportunities,  etc.)  have  been  put  in  place  at  CSF/NDP  level,  with  the 
objective of measuring the inclusion of themes in programmes. Participants from all 
the  OPs  are  involved.  A  final  report  on  the  implementation  of  gender  equality  was 
delivered to the CSF monitoring committee in December 2007. Closure preparation 
was a regular item on the agenda of the PMCs.  

Annual reports and annual meeting 

All  but  two  (PSOP  and  TA)  of  the  Irish  Annual  Implementation  Reports  were 
received  by  the  Commission  within  the  regulatory  deadlines.  The  Annual  Review 
Meeting  for  2005  and  2006,  covering  all  programmes  under  the  Objective  1  CSF, 
took  place  on  25  September  2007.  This  meeting  focused  on  the  ongoing 
implementation  of  the  programmes,  with  particular  reference  to  the  various  audits 
that  have  been  undertaken  by  the  Commission  and  the  internal  audit  services  in 
Ireland  in  order  to  address  certain  weaknesses  found.  The  Commission  asked  the 
Irish  managing  authorities  and  the  Department  of  Finance  to  strengthen  their 
management  and  control  systems  (Article  4  and  Article  10  checks)  and  to  provide 
more detailed information on the findings from these checks. The Commission also 
asked  Ireland  to  communicate  preliminary  indicative  results  of  the  look-back 
exercise as far as possible.  

Amendments 

During  2007, 
programme complement amendment procedure. 

the  BMW,  S&E  and  PSOP  were  each  subject 

to  one 

EN 

80 

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11.2.  Community Initiatives  

11.2.1.  Equal 

The  Irish  EQUAL  programme  proceeded  without  any  major  difficulties  in  2007. 
There  are  43  Development  Partnerships  funded  under  the  Equal  Community 
Initiative  in  Ireland,  of  which  21  DPs  are  Round  1  and  22  DPs  are  Round  2. 
At the end of 2007, the rate of financial execution of the ESF was 83.2% of the total. 
Payments amounted to EUR 6 287 439. Automatic decommitment under the “n+2” 
rule was avoided for 2007.  

The EQUAL Closing Conference took place in Dublin On 9 October 2007. 

In  July  2007,  the  Commission  adopted  a  decision  amending  the  financial  plan  and 
transferring funds from priorities 2 and 3 to priority 4. 

11.2.2.  Leader 

The EU contribution for 2000-2006 amounts to EUR 48.745 million. At the end of 
2007,  expenditure  amounted  to  EUR  31.5  million,  64.7%  of  the  initial  programme 
budget.  The  mid-term  evaluation  of  Leader+  was  received  by  the  Commission  in 
November 2005 and reported that there had been significant progress since phase 1 
of  the  programming  period.  The  “n+2”  target  was  not  reached  in  2007  and 
EUR 2.8 million was decommitted. 

11.2.3.  Urban 

The  Dublin-Ballyfermot  URBAN II  programme is the only URBAN II Programme 
in Ireland. It was approved in December 2001, and amended in 2004 as a result of 
indexation. The ERDF will contribute a total of EUR 5.38 million to this programme, 
whose total cost amounts to EUR 11.58 million. In 2006, there was an amendment to 
the Programme Complement with no changes to the financial tables. The monitoring 
committee  did  not  meet  during  2007  as  the  programme  is  winding  down  towards 
closure. The annual review was conducted in writing with the responsible authorities 
encouraged to make whatever efforts were necessary to ensure appropriate financial 
control in anticipation of closure. N+2 for 2007 was reached with ease. 

Overall comments concerning the 2000-2006 period in Ireland 

The  Ballyfermot  URBAN  II  programme  has  been  very  successful,  both  in  its 
achievements  and  management.  There  were  no  problems  with  meeting  the 
programme  outputs  and  yearly  “n+2”  targets.  The  success  and  legacy  of  the 
URBAN II programme provided a sound basis for the planning of the next structural 
Funding period in Ireland, and integrated urban development will figure strongly in 
future Operational Programmes.  

11.3.  Closure of the 1994-1999 programming period 

The RAL is zero for ERDF 94-99.  

At the end of 2007, the ESF 94 – 99 was closed and the RAL was zero.  

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With  regard  to  EAGGF,  the  remaining  2  programmes  were  closed  in  2007 
(one programme already having been closed in 2006). 

For the FIFG, the C.I. PESCA programme has not been closed.  

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12. 

LATVIA 

2007-2013 programming period 

The National Strategic Reference Framework and the Operational programmes were 
approved in the third quarter of 2007. There are three operational programmes, two 
of which are ERDF/CF co-financed.  

For the Entrepreneurship and Innovations OP (2007LV161PO001), EUR 80 million 
was  committed  in  September  2007  and  the  advance  payment  was  made  in  October 
2007 (i.e. EUR 15 million under the ERDF). For the Infrastructure and Services OP 
(2007LV161DO002),  EUR  169  million  was  committed  in  December  under  the  CF 
and EUR 186 million under the ERDF. Advance payments for that programme were 
EUR  38  million  under  the  CF  and  EUR  34  million  under  the  ERDF  in December. 
For 
(2007LV051PO001), 
EUR 60 million was committed in November 2007 under the ESF. Advance payment 
for the programme of EUR 11 million was made in December 2007. 

the  Human  Resources 

and  Employment  OP 

For  the  “Innovation  and  Entrepreneurship”  OP,  a  first  set  of  selection  criteria  was 
officially  adopted  in  November  2007,  while  for  the  other  operational  programmes 
draft selection criteria were drawn up for later formal adoption. Selection criteria are 
defined  against  priorities,  measures  and  activities  and  they  are  approved  by  the 
monitoring  committee.  In  general,  these  criteria  largely  take  due  account  of 
EU policies and the horizontal priorities of the programmes.  

Implementation of projects on the ground has not yet started, with the exception of 
the  tendering  for  infrastructure  projects,  on  which  a  funding  decision  has  not  yet 
been taken.  

2000-2006 programming period 

12.1.  Objective 1 

Latvia,  an  Objective  1  NUTS  II  country,  has  financed  eligible  operations  from  the 
Structural  Funds  since  1  January  2004.  With  an  ERDF  participation  of 
EUR 382 million,  out  of  a  total  of  EUR  626  million  for  the  Objective  1 
Structural Funds, the SPD contributes to the Latvian strategic objective of building a 
knowledge-based economy. The SPD (2003LV161DO001) strategy is based on four 
priorities  (excluding  Technical  Assistance):  (i)  Promotion  of  Territorial Cohesion, 
(ii)  Promotion  of  Enterprise  and  Innovation  Development  of  Human Resources, 
(iii) Promotion  of  Employment  and  (iv)  Promotion  of  Development  of  Rural  Areas 
and Fisheries. The SPD (Structural Funds) is coordinated by the managing authority 
within  the  Ministry  of  Finance.  The  Paying  Authority  and  the  Audit  Body  are 
separate Departments within the same ministry.  

The SPD for Latvia 2003LV161DO001 was last amended in March 2007, following 
a  request  Latvia  submitted  in  December  2006.  The amendment  concerned  the 
shifting of funds within priorities in order to ensure sound financial management and 
redefine some of the activities. The programme complement was then adapted in line 
with the above programme amendment. 

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Payment  claims  resulted  in  payments  of  EUR  153  million  under  the  ERDF  and 
EUR 65 million  under  the  ESF.  66%  of  the  ERDF  budget  and  57%  of  the  ESF 
budget  have  been  paid  out  against  interim  payment  claims  submitted  by  Latvia. 
In general, commitments at national level are close to 100%. The agreed objectives 
(among  others,  40  improved  water  service  systems;  250  km  of  renovated  roads; 
12 research  centres  assisted)  for  the  programme  have  already  been  reached  in 
most cases.  

Implementation of FIFG measures progressed well in 2007 and the programme met 
its “n+2” target. Payments in 2007 amounted to EUR 8 million. By the end of 2006, 
75% of the total FIFG allocation had been paid out against interim payment claims 
submitted  by  Latvia,  while  commitments  at  national  level  are  close  to  100%. 
The agreed targets for the FIFG measures have already been reached in most cases.  

The  annual  meeting  for  2007  was  postponed  to  February  2008  in  order  to  give 
priority  to  the  adoption  of  the  operational  programmes  for  the  2007-2013 
programming  period.  The  main  issue  at  the  annual  meeting  was  the  impact  of 
macroeconomic developments on programme implementation. Latvia has the highest 
inflation  rate  (16%)  within  the  EU  and,  as  a  result,  projects  face  significant  cost 
increases (in the construction sector), which might endanger their finalisation.  

Despite  meeting  its  “n+2”  targets,  Latvia  is  considered  to  be  a  slow  absorber  of 
ERDF  funds,  and  the  risk  of  decommitment  at  stage  is  considered  to  be  high. 
The Commission  has  asked  to  be  informed  of  any  steps  taken  by  the  managing 
authority to accelerate absorption (i.e. action plan, close monitoring, redistribution of 
funding,  over-commitments)  and  encouraged  Latvia  to  take  steps  in this  respect. 
The ministries with the worst absorption rates are the Ministry of Economy and the 
Ministry  of  Education  and  Science.  The  managing  authority  is  closely  monitoring 
both of these Ministries. The task of absorbing EUR 175 million in order to achieve 
full  absorption  is  a  stiff  one,  in  particular  given  that  Latvia  intends  to  close  the 
eligibility  period  early  (i.e.  by  the  end  of  August  2008)  in  order  to  avoid  any 
overlapping of tasks in the bodies responsible for the 2000-2006 and the 2007-2013 
programming periods.  

12.2.  Community Initiatives  

12.2.1.  Equal 

The Latvian EQUAL programme proceeded without any major difficulties in 2007. 
At the end of 2007, the rate of financial execution of the ESF amounted to 95% of 
the  total.  Payments  amounted  to  EUR  4.5  million.  Automatic decommitment  under 
the “n+2” rule was thus avoided for 2007.  

A  decision  amending  the  initial  decision  for  the  Latvian  EQUAL  programme  was 
adopted  in  March  2007  and  related  to  the  transfer  of  funds  from  Priority  1 
‘Employability’  to  Priority  3  ‘Adaptability’.  Two  monitoring  committee  meetings 
were  held  —  on  26  June  2007  and  13  November  2007  respectively.  The  first 
approved the Annual Implementation Report for 2006 and the second examined the 
evaluation report. No annual review meetings were held in 2007. 

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12.2.2.  Leader 

Leader+  type  measures  were  included  in  the  Objective  1  programme  under 
Priority 4:  “Promotion  of  Development  of  Rural  Areas  and  Fisheries”.  The  EU 
contribution for 2004-2006 amounts to EUR 2.283 million. The start of Leader+ type 
measures was delayed due to administrative and legal problems. 

In December 2006, seventeen Local Action Groups were selected; project selection 
was  completed  in  October  2007  with  contracts  covering  100%  of  the  finances 
available. 

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13. 

LITHUANIA 

2007-2013 programming period 

Negotiations  between  the  Commission  and  the  Lithuanian  authorities  on  the 
Lithuanian National Strategic Reference Framework (NSRF) and the four operational 
programmes,  two  co-financed  jointly  by  the  ERDF  and  the  Cohesion  Fund 
(“Economic Growth” and “Promotion of Cohesion”) and two co-financed by the ESF 
(“Human  Resources  Development”  and  “Technical  Assistance”),  were  successfully 
concluded  in  2007.  The Commission  Decision  approving  certain  parts  of  the 
Lithuanian  NSRF  was  adopted  on  26  April  2007,  the  Commission  decisions 
approving  the  operational programmes  co-financed  by  the  ERDF  were  adopted  on 
30 July  2007,  and  the  Commission  decisions  approving  the  “Human  Resources 
Development” and the “Technical Assistance” operational  programmes co-financed 
by the ESF were adopted on 24 September 2007 and 18 December 2007 respectively. 
The  operational  programmes  for  “Economic  Growth”  and  “Human  Resources 
Development”  have  particularly  strong  links  with  the  priorities  of  the  renewed 
Lisbon strategy. The operational programme for “Promotion of Cohesion” provides 
strategic responses to the developmental disparities within Lithuania. 

2000-2006 programming period 

13.1.  Objective 1 

General 

The  Lithuanian  Objective  1  Programme  (Single  Programming  Document  of 
Lithuania  for  2004-2006)  covers  the  whole  of  Lithuania  as  an  eligible  area. 
The programme was adopted by Commission Decision C(2004)2120 of 18 June 2004 
and is co-financed by the ERDF (EUR 583.9 million), the ESF (EUR 176.2 million), 
the  EAGGF  (EUR  122.9  million),  and  the  FIFG  (EUR  12.1  million).  The  national 
counterpart consists of EUR 309.5 million of public funding and EUR 2.3 million of 
private financing. Thus, the Structural Funds provide EUR 895 million out of a total 
budget  of  EUR  1207  million.  The  managing  authority  of  the  programme  is  the 
Ministry of Finance of the Republic of Lithuania. 

The  programme  consists  of 
Infrastructure 
(EUR 347.1  million,  ERDF),  Human  Resources  Development  (EUR  163.8  million, 
ESF),  Productive  Sector  and  Services  (EUR  222.4  million,  ERDF),  Rural  and 
Fisheries Development (EUR 122.9 million, EAGGF and EUR 12.1 million, FIFG), 
and Technical Assistance (EUR 14.5 million, ERDF and EUR 12.4 million, ESF). 

five  priorities:  Socio-economic 

Monitoring and annual review 

Two  programme  monitoring  committee  meetings  were  held  in  2007.  Attainment  of 
the  quantified  targets  and  financial  implementation  of  the  programme,  as  well  as 
adjustments to the programme complement, were among the key items discussed. 

The  2006  annual  implementation  report  was  duly  submitted  by  Lithuania  and 
accepted by the Commission. The report contains useful information on the status of 

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SPD  implementation  in  2006.  A  number  of  examples  of  good  practice  projects  are 
given,  thus  making  the  report  more  informative  and  reader-friendly  to  the  general 
public. The report also contains structured information on financial implementation 
and  monitoring  indicators,  although  in  some  cases  the  availability  of  reliable  and 
consistent monitoring information is not evident. 

An annual review meeting was held on 18 October 2007. The main discussion items 
were  the  contents  of  the  annual  implementation  report  and  the  preparations  for 
closure of the programme. 

Information and publicity 

Information  and  publicity  activities  were  implemented  in  2007  using  a  variety  of 
printed  and  electronic  media.  The  Lithuanian  authorities  organised  a  national 
information and publicity event in Vilnius on 24 May 2007, showcasing a selection 
of best project examples, including an open internet vote to select the most popular 
internet  portal 
projects  co-financed  by 
www.esparama.lt operated by the Lithuanian Ministry of Finance has proved to be a 
helpful  tool  in  providing  timely  data  on  the  planning  and  implementation  of  EU 
structural assistance in Lithuania.  

the  Structural  Funds.  A  public 

Payments and programme results  

By  the  end  of  2007,  67%  of  the  total  ERDF  allocation  and  51%  of  the  total  ESF 
allocation,  including  an  advance  payment,  had  been  paid  out  to  Lithuania  by  the 
Commission, and more than a thousand operations had been granted assistance from 
the  ERDF.  As  to  the  attainment  of  the  quantitative  objectives  of  the  programme, 
some  divergences  can  be  observed  between  the  forecast  and  actual  achievements. 
While  the  quality  of  assisted  operations  is  being  monitored  by  the  national 
authorities,  in  2007  greater  attention  has  also  been  given  to  increasing  the 
consistency and reliability of the system of indicators of the programme. 

With regard to FIFG measures, by the end of the year, the Commission had paid 79% 
of the total of EUR 12.2 million allocations (including advance), while over 90% was 
committed  by  the  national  authorities.  There  was  no  “n+2”  risk  in  2007. 
However, 2008 will be crucial year in terms of absorbing the remaining funds.  

At  the  end  of  2007,  the  absorption  rate  of  the  total  EAGGF-Guidance  allocation 
(including the advance) reached 84.5%. By that date, 82% of operations financed by 
the EAGGF-Guidance Section had been completed. 

13.2.  Community Initiatives  

13.2.1.  Equal 

At the end of 2007, the rate of execution of the ESF part of the Lithuanian EQUAL 
programme  was  approximately  57%  of  the  total,  including  a  16%  advance. 
the  “n+2” 
Automatic  decommitment  under 
for  2007. 
The managing authority 
committee  meetings. 
two  monitoring 
The Commission Decision was amended on 15 May 2007. 

rule  was  avoided 

held 

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13.2.2.  Leader 

Leader+  type  measures  are  mainstreamed  in  the  Objective  1  programme  under 
Priority 4: Rural and Fisheries Development. In total, ten Local Action Groups were 
selected for implementation of the pilot integrated strategies. 

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14. 

LUXEMBOURG 

2007-2013 programming period 

For the 2007-2013 programming period, Luxembourg is to receive Cohesion Policy 
funds  from  the  European  Union  to  help  it  implement  two  programmes  under  the 
Regional  Competitiveness  and  Employment  objective  (one  ERDF  programme  and 
one  ESF  programme,  each  worth  EUR  25.2  million),  plus  one  or  possibly  several 
programmes under the European Territorial Cooperation objective for an amount of 
EUR 14.8 million. The total support provided therefore amounts to EUR 65 million.  

for 

The signing ceremony of the National Strategic Reference Framework (NSRF) took 
place  in  Luxembourg  in  the  presence  of  Danuta  Hübner,  the  Commissioner 
for 
responsible 
the  Minister 
Economic Affairs  and  Foreign  Trade.  The  event  officially  marks 
the 
investment  strategy  chosen  by 
European Commission’s  agreement  on 
Luxembourg to implement Cohesion Policy for 2007-2013. The Commissioner also 
held discussions with Prime Minister Jean-Claude Juncker.  

regional  policy,  and  Jeannot  Krecké, 

the 

The  NSRF  for  Luxembourg  was  officially  adopted  by  the  Commission  on 
8 October 2007.  In  their  national  strategic  reference  framework,  the  Luxembourg 
authorities  describe  how  they  plan  to  invest  the  EUR  65.27  million  of  European 
funding  over  seven  years,  in  accordance  with  the  Lisbon  strategy  for  growth  and 
employment. The following priorities are defined: 

–  help  make  Luxembourg  more  attractive  for  investment  and  jobs:  this  means  in 
particular  promoting  the  establishment  of  small  and  medium-sized  enterprises 
(SMEs) and redeveloping urban centres that have undergone economic change;  

–  improve  knowledge  and  innovation,  which  are  growth  factors:  to  invest  in 
equipping private and public research centres and encourage the innovation efforts 
of  enterprises;  to  create  more  and  better  jobs;  to  give  job  seekers  individual 
attention and to increase the low employment rates of women and older workers. 

The entire country is to benefit under the Regional Competitiveness and Employment 
objective, in contrast to the 2000-2006 period when only certain specific areas were 
entitled to benefit from ERDF funds.  

Strategic objectives — This strategic document forms the framework for European 
investment of EUR 65.2 million in Luxembourg during the 2007-2013 programming 
period. The authorities have set three priorities for investment, namely, to help  

–  make Luxembourg a more attractive place for investing and working, notably by 
promoting  the  establishment  of  small  and  medium-sized  enterprises  (SME)  and 
redeveloping urban areas that have undergone economic change;  

–  improve  knowledge  and  innovation,  two  key  growth  factors,  by  focusing 
investment on equipping private and public research centres and by encouraging 
the innovation efforts of enterprises;  

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–  create more and better jobs, by providing personal assistance to job seekers and by 

increasing the low employment rates among women and older workers. 

The  expected  impact  of  the  new  Cohesion  Policy  —  Due  to  its  limited  financial 
resources,  the  NSRF  must  ensure  that  the  Community  support  focuses  on  a  set 
number  of  themes  and  priorities  and  on  operations  that  pave  the  way  in  terms  of 
regional development and employment. The aim is to avoid all forms of ‘diluting’ or 
‘spreading thinly’ and to obtain maximum Community value added.  

One of Luxembourg’s features is its low level of public investment in research and 
development  (R&D).  Private  R&D  differs  in  that  it  is  concentrated  in  a  handful  of 
large  enterprises.  However,  the  setting-up  of  the  University  of  Luxembourg  and  a 
National  Research  Fund  should  help  to  improve  the  situation.  Investments  in  R&D 
should achieve the 3% of GDP target by 2010. 

The  NSRF  will  help  Luxembourg  to  meet  the  objectives  that  it  set  itself  under  the 
Kyoto  Protocol,  namely  reducing  greenhouse  gas  emissions  by  28%  by  2012  in 
comparison to 1990 levels. 

Investment for growth and jobs — 75% of the total Funds will target the priorities 
set out in the Lisbon Strategy for growth and jobs (notably research and innovation, 
energy  efficiency,  freeing  up  SMEs,  entrepreneurship  and  education,  investment  in 
human capital and modernisation of labour markets). As regards the ERDF, 82% of 
expenditure will be in line with the Lisbon Strategy. For the ESF, the entire amount 
will  be  allocated  to  the  Integrated  Guidelines  (IG)  for  growth  and  employment,  as 
established at Community level. 

Operational  programmes  —  The  objectives  of  the  NSRF  will  be  implemented 
through  two  operational  programmes:  one  ERDF  Luxembourg  programme  and  one 
ESF Luxembourg programme. 

Additional  financial  support  of  EUR  14.8  million  is  to  be  set  aside  for  the 
European Territorial Cooperation objective. 

2000-2006 programming period 

14.1.  Objective 2 

2007  concentrated  on  best  consumption  of  the  allocation  of  appropriations  in  an 
effort to avoid any decommitment under the “n+2” rule. 

Overall, 100% of the programme budget was allocated through grant agreements. 

The  programme  monitoring  committee  met  twice  in  2007,  at  the  initiative  of  the 
Ministry  of  Economy  and  Transport,  the  managing  authority  of  the  programme. 
The Commission played an active part in the work of the committee. 

The annual report was adopted at the May meeting of the monitoring committee.  

The  level  of  the  expenditure  submitted  for  payment  from  the  ERDF  amounted  to 
EUR 31.43 million, i.e. 71.4% of the ERDF allocation at the end of 2007. 

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14.2.  Objective 3 

The Objective 3 programme involves a total ESF contribution of EUR 35.57 million. 
At the end of 2007, the rate of execution amounted to 66% of the total. 

Four  requests  for  payment  were  submitted  to  the  Commission  in  2007  for  a  total 
amount of EUR 2.31 million, but two requests were not executed following the audit 
mission  in  June-July  2007,  which  detected  serious  deficiencies  with  regard  to 
Articles 3, 4, 7 and 9 of Regulation 438/2001. 

The  Luxembourg  Authorities  launched  a  call  in  2007  for  the  extension  of  existing 
contracts  in  order  to  reduce  the  risks  of  decommitment  as  far  as  possible. 
Nevertheless,  absorption  capacity  remains  a  problem  and,  under  the  “n+2”  rule, 
EUR 3.89 million will have to be decommitted. 

The annual meeting took place on 13 February 2007 and the monitoring committee 
met  on  26  June  2007.  The  annual  report  for  2006  was  adopted  by  the  monitoring 
committee  in  June  2007  and  approved  by  the  Commission  in  September  2007, 
subject to a number of reservations regarding the lack of evaluation concerning older 
workers and the lack of results indicators. 

14.3.  Community Initiatives  

14.3.1.  Equal 

Despite  minor  “n+2”  problems,  the  Luxembourg  programme  runs  smoothly. 
However,  the  audit  mission  held  in  June-July  2007  brought  serious  deficiencies  to 
light,  which  are  still  being  discussed  with  the  national  authorities.  EUR 0.3  million 
will have to be decommitted under the “n+2” rule. 

No  annual  meetings  were  held  in  2007  and  the  Equal  representative  of  the 
Commission was not present at the monitoring committee meeting that took place on 
26 June 2007. 

14.3.2.  Leader 

The  programme  involves  total  public  expenditure  of  EUR  8.42  million,  of  which 
EUR  2.14  million  from  the  EAGGF  Guidance  Section.  In  Luxembourg,  4  LAGs 
were selected, covering 90 000 inhabitants, and a fifth is financed by national funds. 

At the end of 2007, after seven years of implementation, the total financial execution 
is  66.66%  of  the  total  EAGGF-Guidance  expenditure  scheduled  for  the  period 
2000-2006, i.e. EUR 1.40 million out of a total of EUR 2.1 million. 

The  National  Leader  network  unit  became 
Implementation of the programme is currently satisfactory for all stakeholders. 

fully  operational 

in  2004. 

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15. 

HUNGARY 

2007-2013 programming period 

adopted 

formally 

the  Hungarian  National  Strategic 
The  Commission 
Reference Framework  on  7  May  2007  and  all  fifteen  Operational  Programmes 
(seven regional  and  eight  sectoral  programmes; 
the 
ERDF/Cohesion  Fund,  two  from  the  ESF)  by  mid-September  2007.  Two  sectoral 
operational  programmes,  notably  Social  Infrastructure  and  Economic  Development 
OPs cover the six Convergence regions,11 while  the  Social  Renewal,  State Reform, 
Transport, 
and 
E-administration Operational Programmes cover the whole country. 

thirteen  financed  from 

Implementation 

Environment 

Energy, 

and 

The  Structural  Funds  contribution  to  the  NSRF  is  EUR  16.279  billion  at 
current prices, while the Cohesion Fund contribution is EUR 8.642 billion at current 
prices. Within the same period, an amount of EUR 3.840 billion will be available for 
Hungary  from  the  EAFRD  and  EFF.  Assistance  from  the  Structural  Instruments 
breaks down as follows: ERDF 50.8%, ESF 14.6%; CF 34.7%. 

The first official meetings of the programme monitoring committees were held for all 
operational programmes in autumn 2007. The main issues discussed at the meetings 
included the rules of procedures and the project selection criteria.  

The  first  calls  for  proposals  were  launched  in  February  2007.  By  the  end  of  2007, 
195 calls for proposals had been published, 10-13 for each operational programme. 
Around 800 centrally appointed ‘key projects’ have also been selected. 

2000-2006 programming period 

15.1.  Objective 1 

The  Hungarian  Community  Support  Framework  for  2004-2006  consists  of  five 
operational programmes covering the whole country, since all the seven Hungarian 
NUTS  II  level  regions  correspond  to  Objective  1  in  the  2004-2006  period. 
The Structural Funds contribution to the CSF is EUR 1.995 billion at current prices. 
Assistance  from  the  Structural  Funds  breaks  down  as  follows:  ERDF  62.1%, 
ESF 22%; EAGGF Guidance Section 15.68%; FIFG 0.22%.  

In  terms  of  ERDF  expenditure,  the  2004-2006  Hungarian  Community  Support 
Framework  achieved  good  results.  The  payment  rate  was  86.28%  of  total  public 
funding  (including  16%  of  advance  payments).  In  terms  of  ESF  expenditure, 
the payment  rate  was  63%  of  total  public  funding  (including  16%  of  advance 
payments).  The  “n+2”  targets  for  2007  were  met  by  all  operational  programmes 
and Funds. 

monitoring  committee  meetings  were  held  for  each  OP  and  for  the  CSF. 
The Annual Review  Meeting  on 
took  place  on 
21 November 2007. 

the  Structural  Funds 

11 

For the 2007-2013 programming period, Hungary has six NUTS II level regions under the Convergence 
objective and one region under the Regional Competitiveness and Employment objective. 

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Economic Competitiveness OP 

The  ECOP  payment  rate  was  91.15%  of  the  total  public  cost  by  the  end  of  2007. 
The most  successful  priority  in  terms  of  payments  to  final  beneficiaries  was  the 
Investment Promotion priority. The least successful in terms of absorption were the 
R&D, innovation and information society priorities, due to the complexity of projects 
and the type of beneficiaries (local governments, universities). The IBs took further 
steps  to  accelerate  payments,  including  letters  to  beneficiaries,  direct  calls,  and 
roadshows in regional centres. 

Human Resources Development Operational Programmes (HRD OP)  

The  ESF  co-finances  most  of  the  priorities  of  the  HRD  OP  (“Supporting  active 
labour market policies”; “Fighting social exclusion by promoting access to the labour 
market” and “Promoting lifelong learning policies”). The “n+2” target was reached 
for 2007 and the payment rate was 61% of the total ESF allocation by the end of the 
year. Although progress seemed to be satisfactory  in  general,  a  few  measures  were 
lagging  behind  in  terms  of  implementation.  Steps  had  been  taken  to  accelerate 
payments towards the final beneficiaries and to raise the absorption rate of the OP. 
Due  to  administrative  changes  in  the  management  system  of  the  programme,  the 
implementing  chapter  of  the  OP  was  amended  twice  in  the  course  of  2007. 
Two out of the three IBs had undergone significant changes, which also contributed 
to the lower absorption rate of some measures.  

The  ERDF  co-finances  priority  4  of  the  HRD  OP,  aimed  at  the  “Development  of 
Education, Social and Health Infrastructure”, which has performed rather well, most 
projects  being  expected  to  be  closed  in  the  first  half  of  2008.  The  ERDF  payment 
rate  by  the  end  of  2007  was  66.77%  of  the  total  ERDF  allocation  to  the  OP. 
The measures  “Developing  the  infrastructure  of  education  and  training”  and 
“Developing  the  infrastructure  of  services  supporting  social  inclusion”  progressed 
normally,  but  there  is  a  slight  risk  of  loss  in  the  measures  “Development  of  health 
care infrastructure in regions lagging behind” and “IT Development in health care in 
regions  lagging  behind”  due  to  the  ongoing  reorganisation  of  health  institutions. 
The MA and the IBs are working to minimise potential losses. 

Environmental Protection and Infrastructure Operational Programme (EIOP)  

The Operational Programme for the Environment and infrastructure progressed well 
in  2007.  The  overall  level  of  payments  reached  86.98%.  Satisfactory  progress  was 
noted  in  both  the  environmental  protection  and  the  transport  infrastructure  axes. 
The uptake of technical assistance funds still needs to be improved.  

Operational Programme for Regional Development (OPRD)  

The  average  payment  rate  for  the  OPRD  reached  90.00%  of  the  total  public  cost. 
As regards  programme  allocation,  there  was  overbooking  of  10-12%,  in  order  to 
cover the loss of resources and to handle exchange risks. The “n+2” target for 2007 
was achieved in the case of the ERDF. 

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Implementation of the ESF-financed priority (“Strengthening the regional dimension 
of  human  resource  development”)  accelerated  after  a  slow  start.  The  “n+2”  target 
was reached in 2007 and the payment rate by the end of the year was 73% of the total 
ESF allocation. Further efforts are needed to reach the target for 2008 (especially in 
the case of the central projects).  

The Operational Programme for Agriculture and Rural Development (ARDOP) 

The  ARDOP’s  contracting  and  payment  rate  showed  remarkable  progress  in  2007. 
As at  31  December  2007,  total  payments  made  under  measures  co-financed  by  the 
EAGGF-Guidance Section (including the advance) amounted to EUR 285 million or 
91% of the total Fund allocation for the period 2004-2006.  

Fisheries 

In  2007,  four  payments  were  made  to  cover  the  reimbursement  claims.  Overall, 
the FIFG  payment  rate  is  69%  (out  of  EUR  4 389  million).  Most  of  the  funds  are 
spent on aquaculture. 

15.2.  Community Initiatives  

15.2.1.  Equal 

The  Hungarian  EQUAL  Community  Initiative  Programme  supports  innovative 
projects in the field of employability, lifelong learning, equality between women and 
men,  and  support  for  asylum  seekers.  The  ESF  contribution  amounts 
to 
EUR 30 292 135.  Through  a  PC  amendment  in  2007,  funds  were  re-allocated  from 
the  preparatory  phase  to  the  mainstreaming  phase,  which  underlines  the  shift  of 
priorities  towards  the  latter.  The  flow  of  declared  expenditure  was  constant  in  the 
course of 2007, there was no “n+2” decommitment, and the payment rate was 61%. 

15.2.2.  Leader 

Hungary  has  included  a  Leader+  type  measure  in  the  ARDOP  under  priority  3, 
development of rural areas. Implementation is underway. 

EN 

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16. 

MALTA 

2000-2006 programming period 

16.1.  Objective 1 

Budgetary execution 

Malta’s Objective 1 SPD for 2004-2006 progressed at a good pace in its fourth year 
of implementation: 

–  100% was already committed in 2006. 

–  Cumulated  payments  executed  increased  from  39.7%  (31.12.2006)  to  75.42% 

(31.12.2007). 

–  The  “n+2”  threshold  was  exceeded  on  every  fund,  even  without  considering  the 

advance payment. 

,  total  payments  made  as  at 
As  regards  implementation  of  the  EAGGF, 
31 December 2007  under  measures  co-financed  by  the  EAGGF-Guidance  Section 
amounted  to  EUR  2  621  131  (interim  payments  of  EUR  1  949  131  and  advance 
payments  of  EUR  672  000).  Interim  payments  executed  in  2007  amounted  to 
EUR 1 085 855. 

Overall results of programme implementation throughout the programming period 

The  key  issue  of  internal  cohesion  is  the  catching-up  process  of  Gozo,  the  sister 
island  of  Malta,  with  its  double  insularity  problems.  Successful  sectors  of 
intervention on the island of Gozo, leading to results in 2007, were: 

–  accessibility (roads) 

–  support for tourism and manufacturing (linked) 

–  human resources development (training centres, lifelong learning and retraining) 

–  environment enhancement and environmental protection (natural heritage, landfill 

effluent treatment, separate household collection and treatment) 

A  wide  publicity  campaign  and  survey  on  EU  and  EU  funds  was  run  in  2007,  in 
parallel with Eurobarometer. The main outcomes were that: 

–  the  Structural  Funds  appear  to  be  much  more  popular  than  the  EU  itself 

(72% against 46%); 

–  awareness of Structural Funds projects, already high (69%), had slightly increased 

to 72%; 

–  most of the popularity is linked to assistance on roads (80%) and on water (>30%, 

very high for a network service); 

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–  most people shared the opinion of additionality of funds (“such project would not 

have been implemented without the EU contribution”) 

Programme  amendments,  subjects  covered  at  the  annual  meeting  and  monitoring 
committee meetings 

The  monitoring  committee  met  3  times  in 2007, with the aim of ensuring effective 
follow-up and control of assistance: 

–  in  February  –  for  monitoring  purposes  only,  without  the  attendance  of  the 

Commission,  

–  in May and October — as “decisional” MC involving the Commission desks. 

–  Main subjects covered: 

–  implementation update 

–  adoption of annual implementation reports (in May) 

–  amendment to the programme complement 

–  thematic evaluation of projects financed in Gozo 

–  publicity campaign and survey on EU and EU funds 

There was no annual meeting as usual, in agreement with the Commission, due to the 
regular monitoring in place. 

An amendment to the SPD was required in 2007 in order to increase the allocation of 
the national counterpart to the FIFG. The decision was adopted by the Commission 
in August. Subsequently, an amendment to the programme complement was adopted. 

Another  minor  amendment  to  the  programme  complement,  concerning  project 
selection and a slight revision of targets, was started in 2007 and completed in 2008. 

16.2.  Community Initiatives  

16.2.1.  Equal 

All  EQUAL  projects  had  finalised  their  training  activities  by  the  end  of 
December 2007.  The  monitoring 
the  EQUAL 
Community Initiative Programme met twice during 2007, in May and October. 

committee 

(MC) 

on 

The  EQUAL  Programme  did  not  have  any  problems  with  the  “n+2”  rule  in  2007. 
By the end of 2007, total payments made under the Equal Programme amounted to 
EUR 1.1 million (out of total ESF payments of EUR 8.7 million). 

EN 

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17. 

NETHERLANDS 

2000-2006 programming period 

17.1.  Objective 1 

The  Flevoland  province  receives  phasing-out  support  under  Objective  1  amounting 
to  EUR  131.9  million  (of  which  EUR  81.7  million ERDF  and  EUR  33.6  million 
ESF).  Programme  implementation  proceeded  relatively  smoothly.  By  the  end  of 
2007,  some  EUR 77.6 million  or  95%  of  the  ERDF  allocation  had  been  effectively 
spent and certified. For the ESF, certified expenditure amounted to EUR 28.8 million 
or 86% of the ESF allocation. By end of 2007, the managing authority had submitted 
a minor adjustment to the financing plan of the programming complement.  

Global execution of the EAGGF-Guidance Section at the end of 2007 amounted to 
EUR 8.0 million or 77% of the EAGGF allocation. 

17.2.  Objective 2 

Financial absorption of the four Objective 2 programmes continued in a satisfactory 
manner, as before. By the end of 2007, all programmes had received between 82% 
and 86% of the respective ERDF allocation. There is a risk of decommitment under 
the  “n+2”  rule  for  2006  for  two  programmes,  amounting  to  a  total  of  some 
EUR 8.5 million. 

that  was  agreed  upon  following 

During  2007,  coordination  within  the  Netherlands  further  improved  and  better 
control  and  monitoring  procedures  were  implemented  in  the  context  of  the 
action plan 
the  2005  and  2006  audits. 
The Annual Review  Meeting  (covering  the  2000-2006  Objectives  1  and  2  and  also 
the new 2007-2013 operational programmes) was held on 9 November in Eindhoven. 
The major issues concerned the effects of the National Action Plan and the start of 
the new programming period 2007-2013. 

Commissioner  Hübner  concluded  a  series  of  regional  visits  to  the  Netherlands  in 
Limburg (in March) and Noord-Brabant (in June). She also met the Dutch Queen and 
the German President at the Dutch-German border in Twente (in October). 

17.3.  Objective 3 

The  total  available  ESF  allocation  for  the  SPD  amounts  to  EUR  1.5  billion,  which 
had been committed by the end of October 2005. All projects terminated by the end 
of 2007. Payment applications received up to 31 December 2007 cover 78% of the 
available  allocation  and  exceed  the  available  budget  of  the  2005  tranche. 
No decommitment  is  therefore  envisaged.  By  the  end  of  2007,  the  managing 
authority  had  submitted  an  adjustment  to  the  financing  plan  of  the  programming 
complement.  The monitoring  committee  met  twice  and  the  Annual  Implementation 
Report was received on time. 

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17.4. 

Fisheries outside Objective 1 

The  total  FIFG  allocation  (including  performance  reserve)  to  the  fisheries 
programme  is  EUR  33.5  million.  The  most  important  measures,  in  line  with  the 
Common  Fisheries  Policy,  are  scrapping  of  vessels,  processing  and  marketing, 
collective investments and innovative measures. Although overall implementation of 
the programme has been rather good, the programme is now subject to the “n+2” rule 
for  the  first  time  (EUR  0.745  million  of  2005  commitment  appropriations). 
By the end  of  2007,  the  2006  annual  implementation  report  had  not  yet  been 
submitted to the Commission. 

17.5.  Community Initiatives  

17.5.1.  Urban 

Three URBAN II programmes are implemented in the Netherlands in respect of the 
2000-2006 programming period in the cities of Amsterdam, Rotterdam and Heerlen. 
The ERDF contribution to the programmes in Amsterdam and Rotterdam is around 
EUR 9 million each and in Heerlen around EUR 12 million, the total eligible cost of 
the  programmes  amounting  to  some  EUR  84  million.  The  city  itself  is  both 
managing authority and paying authority.  

The  2006  annual  reports  have  been  received  and  accepted,  giving  accounts  of 
satisfactory  implementation  of  all  three  programmes.  This  development  was 
confirmed by the fact that all three programmes managed to reach the “n+2” target 
for 2005 at the end of 2007. 

In the case of all three URBAN II programmes, the city itself is both the managing 
and the paying authority. The Ministry of the Interior provides informal coordination 
of information. 

Overall comments concerning the 2000-2006 period in the Netherlands 

The  programmes  are  running  very  well  and  their  impact  can  be  seen  in  terms  of 
improved  safety,  economic  development  and 
jobs  for  young  people  with 
low qualifications.  In  general,  the  projects  of  these  programmes  were  assessed  as 
being  innovative.  The  management  and  implementation  structure  made  for  swift 
completion of projects.  

17.5.2.  Equal 

Although the EQUAL programme  in  the Netherlands proceeded without any major 
difficulties in 2007, payment applications received up to 31 December 2007 were not 
sufficient to reach the “n+2” target for 2005. A decommitment of EUR 17.9 million 
is therefore envisaged. 

All  projects  ended  by  31  December  2007.  A  closure  conference  was  organised  in 
December  2007,  at  which  the  5  national  thematic  networks  (Integration  and 
Labour Market,  Learning  and  Working,  Activation,  Equal  Opportunities,  and 
Entrepreneurship) presented their final reports. An electronic database containing the 
products  and  methodologies  developed  by  EQUAL  projects  will  be  published 
(first half of 2008) at www.agentschapszw.nl. 

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The  monitoring  committee  met  once  and  the  Annual  Implementation  Report  was 
received on time. 

17.5.3.  Leader 

programming 

Four  Leader+  programmes  are  being  implemented  in  the  Netherlands  in  the 
2000-2006 
and  Oost). 
The EAGGF-Guidance  Section  contribution  to  these  programmes  amounts  to 
EUR 82.6 million.  At 
to 
EUR 56.0 million or 67.8% of the EAGGF allocation. 

the  end  of  2007,  global  execution  amounted 

(Randstad,  Noord,  Zuid 

period 

For  the  programme  Leader+  Randstad,  decommitment  under  the  “n+2”  rule, 
amounting  to  EUR  1  065  846,  was  enacted  by  Decision  C(2007)6668.  No  other 
changes to the programmes were made in 2007. 

17.6.  Closure of the 1994-1999 programming period 

It  has  not  yet  been  possible  to  close  the  only  remaining  Dutch  programme  with 
ERDF  assistance.  A  revised  proposal  has  been  prepared  in  the  context  of  an 
Article 24 procedure. However, the unsettled commitment involved is very small. 

As regards the ESF, three programmes remain open, despite a decreasing number of 
ongoing judicial procedures. 

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18. 

AUSTRIA 

2007-2013 programming period 

The  National  Strategic  Reference  Framework  (NSRF  –  designated  in  Austria  as 
“strat.at”)  was  adopted  by  Commission  Decision  C(2007)1462  on  04/04/2007. 
It provides  for  total  ERDF  and  ESF  contributions  of  EUR  680  066  021  and 
EUR 524 412 560 respectively. 5 priorities are envisaged: 

(1) 

(2) 

(3) 

regional competitiveness and innovation; 

attractive regions and quality of location; 

employment growth and qualification of the labour force; 

(4) 

territorial cooperation; 

(5) 

governance. 

The  ESF  OP  Burgenland  Phasing-Out  Objective  1  2007-2013  was  adopted 
by Commission  Decision  C(2007)4485  on  25/09/2007,  and  the  OP  Employment 
by Commission Decision C(2007)6721 on 17/12/2007. 

The kick-off conference on the Structural Funds period 2007-2013 in Austria, held in 
in  June  2007,  assembled  federal  authorities  (Oerok,  ministries, 
Eisenstadt 
regional 
Federal Chancellery), 
authorities), 
the 
(DG  REGIO  and  DG  EMPL)  and  business 
the European  Commission 
representatives. Speakers underlined the positive impact of SF support for Austria’s 
regional and spatial development.  

(Länder,  managing 

level 

The  first  Monitoring  Committee  Meeting  Burgenland  Phasing-Out  Convergence 
2007-2013 held in Lutzmannsburg in June 2007 covered both ERDF and ESF OPs. 
The  meeting  laid  the  first  cornerstones  in  terms  of  rules  of  procedure  and  project 
selection criteria.  

The  first  Monitoring  Committee  Meeting  of  the  Austrian  OP  ESF  Employment 
2007-2013 took place in Vienna on 20 June 2007 and adopted the rules of procedure. 
Progress  with  the  OP,  project  selection  criteria,  questions  relating  to  publicity  and 
Territorial Employment Pacts were also discussed.  

The Operational Programme for the implementation of the European Fisheries Fund 
in Austria was adopted on 17 December 2007. Commitments of the annual amounts 
for  2007  and  2008  have  been  made.  The  advance  payment  of  7%  (out  of  a  total 
budget  of  EUR  5  259  318)  was  made  on  3  January  2008.  This  includes 
EUR 13 112 for  the  region  under  the  Convergence  Objective,  Burgenland,  and 
EUR 355  039  for  the  rest  of  the  country  outside  the  Convergence  Objective. 
The first meeting  of  the  monitoring  committee  was  held  on  1  February  2008. 
Selection criteria and national implementing legislation are in place. 

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2000-2006 programming period 

Austria received a total Structural Fund contribution of EUR 1 782 million between 
2000 and 2006 from the ERDF, ESF, EAGGF and FIFG.  

18.1.  Objective 1 

The  only  Objective  1  region  in  Austria  is  Burgenland.  In  2007,  both  the  Single 
Programming  Document  and  the  Programme  Complement  were  amended  once. 
The annual meeting of Austria Objectives 1 and 2 2000-2006 was held in St. Pölten 
in  November  2007.  The  state  of  play  of  all  Structural  Funds  programmes  for 
Objectives  1  and  2  was  presented.  The  meeting  also  discussed  certain  aspects 
(management and control systems, ERDF monitoring system, communication plans, 
evaluation  2007-2013)  of  the  new  programming  period  2007-2013.  The  2006 
annual implementation reports for all Funds and priorities concerned were formally 
submitted to the Commission in June 2007 and approved in August 2007.  

In 2007, no commitment of ERDF appropriations was made for this programme, as 
the  entire  amount  of  EUR 181.5  million  had  already  been  committed  between 
2000 and  2006.  However,  the  Commission  reimbursed  certified  expenditures  of 
EUR 20.8  million  to  the  paying  authority,  which  amounts  to  11.5%  of  the  total 
ERDF contribution for the entire programming period, whereas total payments by the 
Commission  between  2000  and  2007  amount  to  EUR  150.6  million  or  83%  of  the 
total ERDF contribution. 

In  2007,  EAGGF-Guidance  Section  payments  made  by  the  Commission  for  the 
Objective 1 priority for Burgenland amounted to EUR 4.855 million. 62.13% of the 
amount  committed  for  2006  was  spent  and  at  the  end  of  2007  the  cumulative 
EAGGF  contribution 
reached  94.20%  of 
total commitments. 

the  period  2000-2006  had 

for 

No  commitments  of  ESF  funds  were  made,  as  the  total  ESF  amount  of 
EUR 57.4 million was already committed up to 2006. EUR 3.7 million was paid in 
2007.  In  the  period  2000-2006,  a  total  of  EUR  57.4  million  was  committed  and 
EUR 48.5  million  was  paid  by  the  Commission  (i.e.  84.4%  of  the  total 
ESF contribution). After the seventh monitoring committee meeting, which was held 
in  June  2006,  no  further  monitoring  committee  meetings  for  the  period  2000-2006 
took place in 2007. All decisions were taken by written procedure. 

For  the  FIFG,  no  payments  were  made  to  Burgenland  as  an  Objective  1  region  in 
2007,  as  the  remaining  programme  cover  has  been  transferred  to  other  Funds 
decommitted after 31 December 2004. 

18.2.  Objective 2 

The  following  eight  Austrian  regions  are  Objective  2  regions:  Upper  Austria, 
Lower Austria,  Styria,  Carinthia,  Salzburg,  Tyrol,  Vorarlberg  and  Vienna.  In  2007, 
no commitments  of  ERDF  appropriations  were  made  to  these  programmes  because 
an  amount  of  EUR  704.9  million  had  already  been  committed  between  2001  and 
expenditure  of 
2007.  However, 
total 
the 
EUR 99.4 million 

the  Commission 
to 

the  paying  authority,  which 

is  14%  of 

reimbursed 

certified 

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ERDF contribution  for  the  entire  programming  period.  Total  payments  by  the 
Commission  between  2000  and  2007  amount  to  EUR  605.6  million  or  86%  of  the 
total ERDF contribution. 

As far as the three programmes containing an ESF component (Carinthia, Styria and 
Vienna) are concerned, no commitments were made in 2007, as the total ESF amount 
of EUR 27.5 million was already committed up to 2006. EUR 3.7 million was paid in 
2007.  In  the  period  2000-2006,  a  total  of  EUR  27.5  million  was  committed  and 
EUR 24.4 million was paid (i.e. 88.7% of the total ESF contribution). 

In  2007,  six  Single  Programming  Documents  were  amended.  Moreover, 
eleven versions of programme complements were accepted.  

As  for  Objective  1,  there  were  no  monitoring  committee  meetings  in  2007  for  the 
period  2000-2006,  and  all  decisions  were  by  written  procedures.  The  2006 
annual implementation  reports  for  the  programmes  were  formally  submitted  to  the 
Commission in June 2007 and approved in August 2007. 

In November 2007, the annual meeting was held in St. Pölten, Lower Austria, for all 
Objective  2  and  Objective  1  programmes.  At  this  meeting  the  state  of  play  of  all 
Structural  Funds  programmes  was  presented  and  discussed  (cf.  above  under 
Objective 1).  

Regarding  “n+2”,  an  amount  of  EUR  1.2  million  has  to  be  decommitted  for  the 
SPD 2 Vienna (ERDF).  

18.3.  Objective 3 

In 2007, no commitment for the ESF programme was made, as the total ESF amount 
of  EUR  571.97  million  was  already  committed  up  to  2006.  EUR  11.9  million  was 
paid  in  2007.  In  the  period  2000-2006,  a  total  of  EUR  571.97  was  committed  and 
EUR 543.37 million paid (i.e. 95% of total ESF contribution).  

A  monitoring  committee  meeting  was  held  in  June  2007.  The  Annual  Report  2006 
and  the  state  of  implementation  were  discussed.  The  audit  follow-up  to  a  previous 
EMPL audit at the BMSK (Ministry for Social Affairs) was a further important issue. 
The 2000-2006 monitoring committee was dissolved and its tasks transferred to the 
2007-2013 monitoring committee.  

18.4. 

Fisheries outside Objective 1 

Within  the  Fisheries  Operational  Programme  for  Austria  outside  Objective  1,  two 
priority  axes  are  being  co-financed  by  the  FIFG,  “Aquatic  resources,  aquaculture, 
fishing  ports,  processing  and  marketing,  inland  fisheries”  and  “Other  measures”. 
Their  respective  shares  of  the  programmes  are  EUR  4  489  000  and  EUR  11  000. 
Financial  execution  has  reached  93.99%  of  the  total  (EUR  4  229  726  out  of 
EUR 4 500 000). There is no risk of “n+2” decommitment in 2007. 

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18.5.  Community Initiatives  

18.5.1.  Urban 

There are two URBAN II programmes for Austria. The Vienna programme receives 
EUR  4.2  million  and  the  Graz  programme  EUR  4.3  million  from  the  ERDF. 
The total  budget  for  Vienna  is  EUR  13.9  million  and  for  Graz  EUR  20.7  million. 
For both  programmes,  annual  reports  were  received  each  year,  found  to  be 
satisfactory and adopted. 

The managing authority for both programmes is the city. The programmes coordinate 
their monitoring committees and both are represented in the monitoring committee of 
the other programme. They meet in autumn each year. 

Both programmes have consistently met the “n+2” targets. 

Overall comments concerning the 2000-2006 period  

The programmes have contributed to the economic regeneration of inner-city areas, 
where old industrial sites have been provided with new infrastructure, facilities and 
access  links,  thus  creating  the  basic  conditions  for  a  new  cycle  of  post-industrial 
economic activity, particularly in the area of technological innovation. 

18.5.2.  Equal 

The Austrian programme proceeded without difficulties in 2007. In financial terms, 
EUR  89  million  had  been  paid  from  the  ESF  by  the  end  of  2007,  out  of  a  total  of 
EUR 103.8 million – a ratio of 86%. Automatic decommitment under the “n+2” rule 
was avoided for 2007. 

No  audits  were  performed  by  the  European  Court  of  Auditors  in  2007. 
A final monitoring  committee  meeting  was  held  on  26  November  2007,  as  Austria 
had  decided  to  close  down  EQUAL  a  year  earlier  than  the  other  Member  States. 
No Annual Meeting was held in 2007. No amendments were made to the programme 
in 2007. 

18.5.3.  Leader 

The  Leader+  programme  for  Austria  was  approved  by  Decision  C(2001)820  of 
26 March  2001,  as  last  amended  by  Decision  C(2006)  4830  of  6  December  2006. 
Total  expenditure  under  the  programme  was  EUR  164.30  million  in  the  period 
2001-2006.  This  includes  an  EU  contribution  of  EUR  76.80  million  and  a 
contribution of EUR 59 million from the private sector (these figures already include 
indexation amounts). 

The Austrian Leader+ programme covers 8 regions of Austria, with the exception of 
urban Vienna. 

The  amount  paid  from  the  EAGGF-Guidance  Section  for  the  Leader+  programme 
was  EUR  21.837  million  in  2007,  bringing  total  payments  to  EUR  64.766  million, 
the 
i.e.  84.29%  of 
EAGGF-Guidance funds for 2006 is still to be consumed. 

the  period  2001-2006.  79.87%  of 

the  amount 

for 

EN 

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   EN 

18.6.  Closure of the 1994-1999 programming period 

As  regards  the  ERDF  contribution  to  the  Austrian  1995-1999  programmes,  all  the 
Objective 
one 
INTERREG programme)  were  closed  before  2006.  The  final  decision  for  the 
INTERREG programme, based on the Article 24 procedure, is still pending.  

and  Community 

2,  Objective 

initiatives 

(except 

5b 

All ESF programmes are closed. 

EN 

104 

   EN 

19. 

POLAND 

2007-2013 programming period 

The  final  version  of  the  NSRF  for  the  2007-2013  period  was  adopted  by  the 
government  on  29  November  2006  and  submitted  to  the  Commission  on 
7 December 2006.  The  first  OPs  were  also  submitted  before  the  end  of  2006:  the 
Innovative  Economy  OP,  the  Human  Capital OP,  the  Technical  Assistance  OP  and 
the  Infrastructure  and  Environment  OP.  The  sixteen  Regional  Operational 
Programmes were submitted by March 2007. The subsequent intensive negotiations 
included 
thematic  and  working  meetings. 
This exercise was  particularly  challenging,  as  the  Polish  regions  were  participating 
for the first time in negotiations as future managing authorities for regional OPs.  

total  64  official  and  30 

in 

The  NSRF  was  adopted  in  less  than  3  months  of  effective  assessment  by  the 
Commission (adopted on 5 May 2007  in the  group  of the first  ten Member States). 
All 21 OPs were adopted by the end of 2007. 18 OPs were adopted within 5 months 
of effective assessment.  

For  two  OPs  (Swietokrzyskie  ROP  and  Infrastructure  and  Environment  OP) 
additional  negotiations  were  necessary  due  to  differences  of  opinions  between  the 
Commission and Poland. 

To measure the impact of Cohesion Policy, the NSRF has set several targets for its 
development strategy:  

–  the  GDP  level  per  capita  (in  PPS)  should  reach  65%  of  the  EU-25  average 

(compared to 51.1% in 2006);  

–  3.5 million jobs should be created with structural and cohesion funds support;  

–  by 2013 the employment rate should be 60% (compared to 52.8% in 2005), and 

35% for people aged 55-64 (in 2013);  

–  the long-term unemployment rate should drop to 3% (from 7.8% in 2006); 

–  the percentage share of the adult population (people aged 25-64) participating in 
education and training should increase to 10% (in comparison to 5.2% in 2005); 

–  for  the  business  sector,  productivity  per  employee  should  reach  75%  of  the 

EU average (compared to 59% in 2005);  

–  R&D expenditure should peak to 1.5% (compared to 0.57% in 2005);  

–  the length of motorways should triple from 554 km to 1 754 km and railways from 

538 km to 1 786 km; and 

–  the renewable energy share in electricity should rise to 8.5% (compared to 2.9% 

in 2005) 

EN 

105 

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The Commission promoted an objective-based approach to OPs by using quantified 
targets. The outcome was a table with strategic indicators (core and additional ones), 
which  was  agreed  between  the  EC  and  the  Polish  authorities.  These  indicators  are 
included in all the relevant priority axes and OPs. This exercise provides for better 
strategies  and  greater  consistency  between  the  programmes  and  makes  for  direct 
comparison  between  programmes  and  aggregated  data.  a  matrix  of  specific 
objectives and measurable targets at programme and priority levels was defined for 
the Human Capital OP.  

Additional  to  the  ROPs,  the  EC  also  asked  the  managing  authorities  to  introduce  a 
GDP target. This target was to reflect the expected GDP level in Purchasing Power 
Standard  in  comparison  to  the  EU-27  and  increase  the  “visibility”  of  the 
EU contribution in the region. 

2000-2006 programming period 

19.1.  Objective 1 

the  end  of  2007.  The  Sectoral  Programme 

2007  was  the  second  year  where  the  “n+2”  rule  was  applicable  to  Poland. 
However, this time it was a real hurdle as the advance payment no longer counted. 
Thanks  to  concerted  efforts  by  the  Commission  and  the  Polish  authorities,  all  the 
“mainstream” programmes avoided decommitment of funds. The Integrated Regional 
OP  was  the  most  advanced  OP  in  terms  of  financial  execution  of  the  ERDF. 
Financial execution of the ESF Priority under the Integrated Regional OP was more 
challenging,  but  finally  at  the  end  of  2007  the  risk  of  “n+2”  was  averted. 
Execution of the ESF under the Sectoral Operational Programme “Human Resources 
Development” showed very good results, reaching a level of reimbursement of 78% 
the 
at 
Sectoral Programme  “Increase  of  Competitiveness  of  Enterprises”  substantially 
accelerated  their  financial  execution  and  exceeded  the  “n+2”  thresholds  with  ease. 
In terms  of  budget  implementation  of  all  Operational  Programmes  together, 
all commitments for 2004-2006 (EUR 4.972 billion for ERDF and EUR 1.908 billion 
for  ESF)  had  been  made  by  the  end  of  2006  —  and  thus  there  were  no  new 
commitments in 2007. As far as payments are concerned, EUR 1.476 billion from the 
ERDF  was  paid  in  2007  (2004-2007:  EUR 3.369  billion  including  advances)  and 
EUR 758.8 million (2004-2007: EUR 1.4 billion including advances) from the ESF. 
Total payments for the EAGGF in 2007 amounted to EUR 346.4 million (2004-2007: 
EUR  895.1  million).  No amounts  from  the  FIFG  funds  were  paid  out  in 2007 
for 
(2004-2006:  EUR 201.5 million).  Although 
FIFG decommitment under the “n+2” rule, total payments amount to only 45% of the 
total FIFG allocation. Total payments for all Structural Funds up to the end of 2007 
were EUR 5.75 billion (including advances). 

for  Transport  and 

there  was 

need 

no 

The Polish authorities use a developed version of the HERMIN model to assess the 
impact  of  Cohesion  Policy  on  the  Polish  economy,  and  estimate  that  in  2007  the 
Structural  Funds  will  have  contributed  to  additional  GDP  growth  in  the  range  of 
0.57%-1.71%,  and  created  up  to  316  000  new  jobs.  This  shows  that,  for  a  country 
like  Poland,  a  massive  inflow  of  EU  funding  will  bring  visible  results  for  the 
Polish economy, even if the supply-side effects are not yet fully taken into account.  

EN 

106 

   EN 

Throughout  2007,  the  Polish  authorities  continued  to  fine-tune  the  implementation 
system,  following  the  finalised  national  action  plan  on  the  simplification  of 
procedures.  The  National  Development  Law  was  amended,  and  rules  for  financial 
management  improved  (handling  of  advances,  co-financing).  The Ministry  for 
Regional  Development  fully  developed  its  capacity  as  the  main  coordinator  of 
Cohesion  Policy  issues  in  Poland,  in  cooperation  with  regional  authorities  and 
national line ministries.  

The  Commission  participated  in  the  CSF  and  the  OP  monitoring  committees. 
Items discussed  included  approval  of  the  periodical  (including  annual)  reports  and 
amendments  (including  financial)  to  the  programme  complement  of  the  respective 
operational programmes.  

The  annual  review  meeting  was  held  in  Poland  on  22-23  October  2007  as  a  joint 
meeting  for  all  OPs  and  Funds.  Additional  annual  meetings  for  ESF  programmes 
(SOP  Human  Resources  Development  and  Integrated  Regional  OP)  were  held  in 
Brussels  in  advance  of  a  mega  Community  Support  Framework  annual  meeting. 
The meetings  focused  on  the  qualitative  assessment  of  the  implementation  of 
programmes so far and on practical measures for improving performance in the near 
future. The main issues discussed were, for example, the contribution of operations 
to  the  Lisbon  Strategy,  implementation  of  the  human  resources  development 
strategy, implementation of transport strategy, measures to boost R&D expenditure, 
and  the  territorial  impact  of  funds  on  inter-regional  differences,  including  the 
prosperity  of  rural  areas.  The  Polish  authorities  presented  the  outcomes  of  the 
evaluations  of  the  Structural  Funds,  which  showed  impressive  results  in  relation  to 
the  macro-economic  impact  of  the  funds.  Unfortunately,  progress  on  R&D  and  the 
information society in this shortened programming period was rather limited due to 
the  new  2007-2013 
the  projects.  In  negotiations  on 
the  complexity  of 
programming period,  therefore,  more  emphasis  was  put  on  achieving  objectives 
geared to the Lisbon agenda (64% of Lisbon-earmarked expenditure). Other aspects 
discussed  during  the  annual  meeting  were  problems  with  compliance  with 
EU policies  (for  example,  public  procurement,  environment),  informatics  system, 
and  boosting  the  administrative  capacity  (programme  management,  coordination, 
project selection). 

One  of  the  issues  to  which  the  attention  of  the  Commission  was  drawn  was  a 
new legal set-up for the next period, i.e. the Development Policy Law was amended 
by the Polish authorities in order to fully comply with EU regulations regarding the 
set-up  of  managing  authorities,  terminology  and  project  selection.  Other  national 
legislation of relevance to Cohesion Policy will need to be further amended in order 
to  be  brought  in  line  with  EU  directives  (i.e.  public  procurement,  environment). 
A stable legal environment in compliance with EU legislation needs to be guaranteed 
in  order  to  give  certainty  to  the  beneficiaries  regarding  the  implementation  of 
their projects. 

19.2.  Community Initiatives 

19.2.1.  Equal 

The  Polish  programme  proceeded  without  difficulties  in  2007.  At  the  end  of  2007, 
the  rate  of  financial  execution  (including  advance  payments)  of  the  ESF  was 

EN 

107 

   EN 

approximately  64.3%  of  the  total.  Automatic  decommitment  under  the  “n+2”  rule 
was avoided for 2007.  

There  were  two  monitoring  committee  meetings  held  in  2007,  one  of  which  the 
Commission attended. Items discussed included approval of the periodic (including 
the  programme 
annual) 
complement.  

reports  and  amendments 

(including 

financial) 

to 

An amendment of the programme entered into force in 2007. 

19.2.2.  Leader 

As  with  other  recently  acceded  Member  States,  a  Leader+  type  measure  is 
mainstreamed 
the  EAGGF  Objective  1  programme  “Restructuring  and 
modernisation of the agri-food sector and rural development”. 

in 

EN 

108 

   EN 

20. 

PORTUGAL 

2000-2006 programming period 

20.1.  Objective 1 

For  operations  in  Portugal,  2007  was  a  challenging  year  with  a  number  of 
reprogramming  exercises  designed  to  maximise  efforts  to  absorb  the  resources 
allocated  for  the  period  2000-2006  and  to  optimise  the  ability  to  comply  with  the 
“n+2” rule, in tandem with negotiations for the new programming period 2007-2013. 

The  2006  annual  reports  for  the  Operational  Programmes  (OPs)  and  for  the 
Community  Support  Framework  III  (CSF  III)  were  submitted  and  accepted  by  the 
Commission.  Occasionally,  approval  of  the  annual  reports  was  accompanied  by 
observations or additional information requested from the Commission.  

Unlike in previous years, a horizontal annual meeting between the Commission and 
the  managing  authorities  for  CSF  III  assistance  in  2007  was  not  considered 
necessary,  primarily  because  most  of  the  effort  was  devoted  to  preparing  the  new 
programming  period.  Nevertheless,  annual  meetings  were  organised  in 2007, 
but only  in  the  case  of  four  operational  programmes  (Accessibility  and  Transport, 
Economy, Alentejo and Norte), where it was deemed necessary. These four meetings 
were  postponed  to  the  first  quarter  of  2008  due  to  pressure  of  work  at  the  end  of 
2007.  The  main  items  on  the  agenda  at  the  annual  meetings  of  these  OPs  were 
financial and physical execution and ability to comply with the “n+2” rule, analysis 
and quantification of indicators, follow-up of the recommendations of the audits and 
ongoing action plans to improve control systems, prospects for closure and a number 
of outstanding issues specific to each programme. An annual review meeting of OPs 
mainly co-financed by the ESF took place in early 2008 regarding implementation in 
2007  and  the  2006  annual  report  on  the  two  biggest  ESF-funded  programmes 
(POEFDS  and  PRODEP).  This meeting  focused  on  the  main  challenges  regarding 
implementation,  the  prospects  for  closure  and  also  the  transition  towards  the 
2007-2013  ESF  OP  (Human  Potential  OP).  On  31  December  2007,  these  OPs 
presented high execution rates and both are scheduled to reach 100% execution for 
closure. The main challenge remains the high error rate in POEFDS. 

As  there  was  no  material  for  discussion  or  information,  the  annual  horizontal  level 
monitoring committee meeting for CSF III did not take place in 2007. 

the  majority  of  Portuguese  OPs  held 

As  usual, 
first  series  of 
monitoring committee  meetings  in  the  first  half  of  2007.  The  second  round  of 
monitoring  committee  meetings  were  considered  not  to  be  necessary  for  the  same 
reasons  as  mentioned  above.  In  many  cases,  written  procedures  were  applied  to 
approve the annual reports and to deal with the reprogramming exercises.  

their 

As  regards  reprogramming,  2007  was  a  year  of  further  adjustments  to  certain 
programmes or programme complements.  

General implementation of the CSF in Portugal continued at a satisfactory pace with 
the  vast  majority  of  payments  concentrated  at  the  end  of  the  year.  In  2007, 

EN 

109 

   EN 

total payment  claims  for  the  CSF  III  transmitted  to  the  Commission  amounted  to 
63%  of  the  payment  claims  forecast  by  the  national  authorities  in  April  2007. 
In nominal terms, this means that EUR 1 651 million was implemented compared to 
the forecast EUR 2 565 million. At Fund level for 2007, the ERDF reached 57% of 
forecast  expenditure,  which  means  that  it  spent  EUR  1  021  million  during  2007. 
The relatively  low  level  of  ERDF  spending  is  due  in  part  to  implementation  of  the 
Action  Plan  on  public  procurement,  which  led  the  Portuguese  Authorities  to 
withdraw  a  considerable  amount  of  irregular  expenditure.  ESF  payments  in  2007 
reached 58% of the total forecast for the year, which amounts to spending of around 
EUR 380 million. For the same year, the EAGGF-Guidance Section reached 76.5% 
of  forecast  expenditure,  i.e.  EUR 248.5  million.  FIFG  payments  compared  to  the 
forecast reached 53% in 2007, i.e. EUR 18 million.  

No  decommitment  amending  decisions  were  needed  in  2007  for  the  ERDF  in 
application of the “n+2” rule at the end of 2006. However, two ERDF programmes 
(Agriculture  and  Rural  Development  and  Information  Society)  did  not  reach  the 
threshold of the “n+2” rule at the end of 2007, and thus the automatic decommitment 
procedures have been initiated.  

As  regards  the  EAGGF-Guidance  Section,  two  decommitment  amending  decisions 
were necessary in 2007, following application of the “n+2” rule at the end of 2006 
for  the  OPs  Algarve  and  Centro.  At  the  end  of  2007,  five  OPs  (Agriculture  and 
Rural Development,  Algarve,  Alentejo,  Centro  and  Norte)  did  not  reach  the  “n+2” 
threshold as regards the EAGGF and the automatic decommitment procedures were 
initiated. 

In 2007, three new major project decisions were adopted by the Commission, which 
all relate to renewable wind energy generation projects. 

20.2.  Community Initiatives 

20.2.1.  Equal 

The  PT  EQUAL  programme  enjoyed  efficient  implementation  throughout  2007. 
A new Decision was adopted [C(2007) 1261, of 14 March 2007] to transfer of funds 
between  priorities.  The  managing  authority  organised  a  monitoring  committee 
meeting on 18 June 2007 in Lisbon, to approve the annual rapport of the preceding 
year,  and  presented  the  CAIM  project  (in  the  field  of  human  trafficking). 
Interim payments amounted to EUR 99.14 million by the end of 2007, i.e. 86% of the 
overall budget. 

20.2.2.  Leader 

Portugal has a single national Leader+ Programme. The total cost of this programme 
for the period 2001-2006 is set at EUR 272.625 million. This includes a contribution 
from  the  EAGGF-Guidance  Section  of  EUR  164.454  million.  At  the  end  of  2007, 
the  planned 
payments  amounted 
EAGGF-Guidance  amount 
In  2007, 
EAGGF payments reached 108% of forecast expenditure for that year, meaning that 
EUR 30.392 million was spent. This programme reached the “n+2” target for 2007. 

the  whole  programming  period. 

to  EUR  137.889  million, 

i.e.  84%  of 

for 

EN 

110 

   EN 

20.2.3.  Urban 

(Vale  de  Alcântara) 

There  are  three  URBAN  II  programmes  in  Portugal:  Amadora  (Damaia-Buraca), 
Lisboa 
receives 
EUR 3.7 million,  Lisboa  EUR  5.7  million  and  Porto-Gondomar  EUR  10.1  million 
from  the  ERDF.  The  total  budget  for  Amadora  is  EUR  10.6  million,  Lisboa 
EUR 10.3 million and Porto-Gondomar EUR 14.5 million. Draft annual reports have 
been received each year for all three programmes, amended in the light of comments 
from the European Commission and adopted.  

and  Porto-Gondomar.  Amadora 

The  managing  authorities  for  the  programmes  are  at  regional  level  in  the  Regional 
Coordination and Development Commissions. In the cases of Amadora and Lisboa, 
this is the Lisboa and Vale do Tejo Region and, in the case of Porto-Gondomar, it is 
the Norte Region. The monitoring committees met once or twice each year. 

All three programmes reached the “n+2” targets for 2007 

Overall, the programmes have tackled serious socio-economic problems in inner-city 
areas  and  contributed  to  the  renovation  of  local  infrastructure,  training,  community 
mediation programmes and the treatment of drug dependency. 

20.3.  Closure of 1994-1999 programming period 

As  regards  the  closure  of  1994-1999  programming  period  for  the  CSF  II,  the  last 
three  ERDF  programmes  open  were  finally  closed  in  2007,  but  there  are  still  audit 
procedures ongoing  that can  result in financial corrections for several programmes. 
The last seven programmes open regarding the EAGGF-Guidance Section were also 
closed  in  2007  and  the  final  decommitment  will  be  made  after  adoption  of  the 
Decision on financial corrections. However, ongoing audit procedures may result in 
financial corrections for several programmes. 

EN 

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   EN 

21. 

SLOVAKIA 

2007-2013 programming period 

As  regards  the  period  2007-2013,  negotiations  on  the  National  Strategic  Reference 
Framework  started  in  October  2005.  The  first  official  text  was  submitted  in 
December  2006,  and  the  Commission  adopted  the  decision  on  the  NSRF  on 
17 August 2007. The NSRF approved eleven operational programmes (ERDF, ESF, 
CF), 
thus  providing  for  a  budget  of  EUR  11.36  billion  for  Slovakia. 
The main discussions  focused  on  achieving  balanced  regional  allocations  and 
involvement  of  the  regions  in  national  programmes  and  on  the  inclusion  of  Roma 
issues  and  energy  efficiency  as  cross-cutting  priorities.  There  was  a  significant 
increase in the share of R&D  and information society measures compared with the 
previous period. 

In  the  new  programming  period,  Slovakia  has  eight  ERDF  OPs  under  the 
Convergence objective, with an ERDF budget of EUR 7 billion. The Research and 
Development OP is a multi-objective OP, while the Transport and Environment OPs 
also  include  Cohesion  Fund  financing  (EUR  3.9  billion).  All  OPs  were  officially 
submitted  in  February/March  2007.  Four operational  programmes  were  adopted  by 
the  Commission  in  September  2007  and  the  remaining  four  in  November  2007. 
Two OPs (Regional OP and Environment OP) had their first monitoring committee 
meetings  in  December  2007,  where  rules  of  procedure  and  selection  criteria  for 
projects were discussed. 

In the new programming period, Slovakia has two multi-objective ESF OPs, with a 
total allocation of EUR 1.5 billion, namely the OP Employment and Social Inclusion 
with  an  allocation  of  EUR  882  million  and  the OP Education with an allocation of 
EUR  618  million.  The  OPs  have  budgets  of  EUR  35.6  million  under  the 
Competitiveness Objective and EUR 1.46 billion under the Convergence Objective. 
Both  OPs  were  officially 
in 
October/November 2007. Both OPs had their first monitoring committee meetings in 
November  2007,  where  rules  of  procedure  and  selection  criteria  for  projects 
were discussed. 

in  March  2007  and  adopted 

submitted 

In  the  programming  period  2007-2013,  there  is  one  ERDF  OP  that  falls  under  the 
Regional  Competitiveness  and  Employment  Objective,  namely  Bratislava,  with  an 
allocation  of  EUR  87  million.  The  OP  was  submitted  in  March  and  adopted 
in December  2007.  There  is  also  a  multi-objective  operational  programme,  namely 
the  Research  and  Development  OP,  with  an  allocation  of  EUR  326  million, 
for Bratislava. 

2000-2006 programming period 

Slovakia  received  a  total  EU  contribution  of  over  EUR  1  145  million  for  the 
programming  period  (2004  to  2006)  under  the  CSF  (i.e.  funding  from  the  ERDF, 
ESF, EAGGF and FIFG). This is split into three mono-fund operational programmes 
and one operational programme funded from the EAGGF and the FIFG, as described 
below.  There  are  also  Objective  2  and  Objective  3  single  programming  documents 
for the Bratislava Region.  

EN 

112 

   EN 

Eight  meetings  of  the  CSF  monitoring  committee  were  held  in  total  (two  meetings 
in 2007)  to  address  horizontal  issues  in  implementation  of  the  Structural  Funds  in 
Slovakia. The discussion focused on horizontal themes - coordination, administrative 
capacities and use of technical assistance, Roma issues, evaluation, simplification of 
procedures  and  regional  aspects  in  thematic  OPs.  The  CSF  annual  report  for  2006 
was submitted in June 2007 and evaluated. 

21.1.  Objective 1 

Two  monitoring  committee  meetings  on  the  Basic  Infrastructure  OP  took  place  in 
2007  (eight  in  the  period  2004-2006).  The  2006  annual  implementation  report  was 
formally submitted to the Commission in June 2007 and approved. The full amount 
of  EUR  422.3  million  (ERDF)  had  already  been  committed  in  the  previous  period. 
EUR  140.5  million  was  paid  in  2007  and  another  EUR  44.1  million  requested 
(paid in 2008). In total, EUR 272.7 million had been paid out up to the end of 2007 
and,  with  the  request  submitted  in  December  for  EUR  44.1  million,  this  comes  to 
75%  of  overall  commitments.  The  OP  has  met  the  “n+2”  rule  so  far.  The  OP  was 
amended  in  May  2007  and  one  amendment  of  the  programme  complement  was 
approved 
programme. 
Approximately 1 100 projects  have  been  financed  under  the  OP,  including  large 
environmental, 
infrastructure, 
road  and 
information technologies and village renewals.  

railway  projects, 

of  money 

reallocation 

schools, 

within 

social 

with 

the 

The Industry and Services OP held two monitoring committee meetings to evaluate 
progress.  The  2006  annual  implementation  report  was  formally  submitted  to  the 
Commission  in  June  2007  and  approved.  The full  amount  of  EUR  151.2  million 
(ERDF) had already been committed in the previous period. EUR 49.1 million was 
paid  in  2007  and  another  EUR  19.6  million  requested  (paid  in  2008).  In  total, 
EUR 88.8  million  had  been  paid  out  up  to  the  end  of  2007  and,  with  the  request 
submitted  in  December  of  EUR  19.6  million,  this  comes  to  71.7%  of  overall 
commitments.  Approximately  400  projects  have  been  financed  under  the  OP, 
including  investments  in  private  companies  and  public  infrastructure  to  support 
innovation,  business  incubators,  industrial  parks,  research  and  development,  energy 
efficiency and tourism. 

in  March  and  one 

The  Agriculture  and  Rural  Development  OP  had  two  meetings  of  its  monitoring 
committee,  one 
in  November  2007.  The  2006 
annual implementation  report  was  submitted  to  the  Commission  in  May  and 
in  a 
subsequently  approved.  Implementation  of 
satisfactory  manner,  the  most  popular  measure  being  investment  in  agricultural 
holdings  (53%  of  funds).  72%  of  allocated  funds  had  been  utilised  by  the  end  of 
2007.  No  proposals  for  programme  amendments  were  submitted  in  2007. 
Three interim  payment  requests  amounting  to  a  total  of  EUR  54  172  910  were 
submitted  to  DG  AGRI  in  2007.  This  amounts  to  30%  of  this  OP’s  total 
EAGGF-Guidance Section allocation for 2004-2006. 

the  programme  progressed 

The  ESF  Human  Resources  OP  held  two  monitoring  committee  meetings  in  2007. 
The  Annual  Implementation  Report  for  2006  was  formally  delivered  in  June  2007 
and approved by the Commission. The annual meeting took place in February 2008. 
The  Paying  Authority  received  EUR  76.5  million  following  the  submission  of 
third  payment  request 
two payment  requests 

in  2007.  Processing  of 

the 

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(EUR 18.7 million) delivered in December 2007 has been interrupted; the process of 
notification  under  Article  39(2)  of  Council  Regulation  (EC)  No  1260/1999  is 
currently under way. In total (advance and interim payments), EUR 197 million has 
been  paid  to  the  Paying  Authority  and,  with  the  interrupted  request  submitted  in 
December 2007, this comes to 76% of the total 2004-2006 ESF allocation. 100% of 
the  total  allocation  was  contracted  in  2007.  The  OP  has  met  the  “n+2”  rule  so far. 
Financial  resources  were  reallocated  in  June  2007  between  measures  of  a 
single priority in order to react to implementation needs. Approximately 800 projects 
the  OP, 
(national  and  demand-driven)  have  so  far  been  financed  under 
including projects  for  active  labour  market  policy  development,  improving  the 
qualification  and  adaptability  of  employees  and  job  seekers,  and  increasing 
social inclusion and equal opportunities in the labour market. 

is  85%  of 

Financial  execution 
the  OP 
(EUR 1 565 million  out  of  EUR  1 829  million).  99%  of  the  funds  for  the  fisheries 
measures  has  been  contracted.  There  is  no  risk  of  “n+2”  decommitment. 
Regular monitoring  committee  meetings  are  held,  which  review  the  situation 
regarding implementation of the OP Agriculture and Rural Development 2004-2006. 

total  FIFG  contribution  for 

the 

21.2.  Objective 2 

implementation  report  was  submitted 

The monitoring committee for the SPD 2 programme Bratislava held two meetings. 
One  amendment  to  the  Commission  Decision  on  the  programme  (December  2007) 
and  two  amendments  to  programme  complements  were  approved  in  2007. 
The 2006 annual 
the  Commission 
in June 2006  and  was  approved.  The  full  amount  of  EUR  37  million  (ERDF)  had 
already  been  committed  in  the  previous  period.  In  2007,  EUR  0.13  million  was 
the  “n+2” 
decommitted 
rule requirements.  Following 
the  managing  authorities, 
increased  efforts  by 
implementation was improved in 2007 and the programme fulfilled the “n+2” targets 
in 2007. In total, EUR 21.1 million had been paid out up to the end of 2007, of which 
EUR 15 million in 2007. This amounts to 57% of overall commitments. More than 
200  projects  have  been  financed  under  the  OP,  including  investments  in  private 
companies, public infrastructure in support of innovation and tourism.  

the  programme  did  not  fully  meet 

in  2007,  as 

to 

21.3.  Objective 3 

The  Single  Programming  Document  Bratislava  Objective  3  held 
two 
monitoring committee  meetings  in  2007.  The  Annual  Implementation  Report  for 
2006  was  formally  delivered  in  June  2007  and  approved  by  the  Commission. 
The annual  meeting  took  place  in  February  2008.  The  Paying  Authority  received 
EUR 7.5 million in 2007 following one payment request from 2006 and two payment 
requests  from  2007.  Processing  of  the  third  payment  request  (EUR  6.5  million) 
delivered in December 2007 has been interrupted; the process of notification under 
Article  39(2)  of  Council  Regulation  (EC)  No  1260/1999  is  currently  under  way. 
In total  (advance  and  interim  payments),  EUR  15.3  million  has  been  paid  to  the 
Paying  Authority  and,  with  the  interrupted  request  submitted  in  December 2007, 
this comes to 35% of the total 2004-2006 allocation. As the programming document 
did not comply with the “n+2” rule at the end of 2006 and EUR 1.25 million had to 
be  decommitted,  an  amending  Commission  Decision  reflecting  the  decommitment 
was  adopted  on  4  October  2007.  The  programming  document  did  not  comply  with 

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the “n+2” in 2007 either, and therefore EUR 6.5 million will have to be decommitted 
(i.e.  44%  of  the  2005  allocation  and  15%  of  the  total  2004-06  ESF  allocation). 
Financial  resources  were  reallocated  in  June  2007  between  measures  of  a  single 
priority in order to react to implementation needs. Projects financed include demand-
driven  and  national  projects  for  active  labour  market  policy  development,  lifelong 
learning development and support for R&D.  

21.4.  Community Initiatives  

21.4.1.  Equal 

in  2007.  Processing  of 

The Community Initiative EQUAL held two monitoring committee meetings in 2007. 
The  Annual  Implementation  Report  for  2006  was  formally  delivered  in  July 2007 
and  approved  by  the  Commission.  The  annual  meeting  did  not  take  place. 
The Paying  Authority  received  EUR  7.4  million  following  submission  of  three 
requests  for  payment 
the  fourth  payment  request 
(EUR 2.8 million) delivered in December 2007 has been interrupted; the process of 
notification  under  Article  39(2)  of  Council  Regulation  (EC)  No  1260/1999  is 
currently  under  way.  Automatic  decommitment  under  the  “n+2”  rule  was  avoided 
both 
interim  payments), 
total 
EUR 11.1 million  has  been  paid  to  the  Paying  Authority  and,  with  the  interrupted 
request  submitted  in  December  2007,  this  comes  to  62%  of  the  total  2004-2006 
ESF allocation. 

(advance  and 

for 2006  and 

for  2005. 

In 

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22. 

SLOVENIA 

2007-2013 programming period 

Reference 

identified  and  analysed.  Slovenia  officially  submitted 

An  intense  phase  of  pre-negotiation  between  the  national  authorities  and  the 
Commission started back in October 2005 when the two parties held a first meeting 
on  macro-economic  issues  at  which  the  main  areas  of  possible  Cohesion  policy 
the 
assistance  were 
National Strategic 
three 
Programme 
Operational Programmes  in  February  2007.  The  NSRF  decision  was  adopted  on 
18 June  2007  whereas 
the  Cohesion  Policy  Operational  Programmes 
“Strengthening Regional  Development  Potentials  (ERDF)”  and  “Development  of 
Environment  and  Transport 
(ERDF/CF)”  were  adopted  on 
27 August 2007.  The  “Human Resources  Development  (ESF)”  OP  was  adopted  on 
21  November  2007.  The  first  monitoring  committee  meetings  took  place  in 
December 2007 and focused mainly on preparing selection criteria and a proposal for 
a communication plan. 

Infrastructure 

(NSRF) 

and 

the 

The general objectives of the NSRF are to improve the welfare of Slovenian citizens 
by  promoting  economic  growth,  facilitating  job  creation,  strengthening  human 
capital  and  ensuring  balanced  and  harmonious  development,  in  particular  at  the 
regional level.  

Overall,  the  negotiations  of  the  2007-2013  programming  period  were  based  on  a 
strong  partnership  and  can  be  described  as  both  open  and  constructive. 
The Commission and the Slovene authorities succeeded in developing strategic and 
thematic priorities with a clear focus on Lisbon objectives. Hence, the majority of the 
total  allocation  of  EUR  4 205  million  (current  prices)  for  Structural  and 
Cohesion Funds for Slovenia in the programming period 2007-2013 will be used to 
promote entrepreneurship, innovation and technological development, to improve the 
quality  of  the  educational  system,  training  and  R&D  activities,  to  increase  labour 
market  flexibility  and  to  guarantee  employment  security.  For  the  programming 
period  2007-2013,  65%  of  National  Strategic  Reference  Framework  resources  are 
earmarked for the renewed Lisbon priorities. 

The  “Strengthening  Regional  Development  Potentials”  Operational  Programme 
(OP SRDP)  specifically  aims  to  enhance  competitiveness,  foster  entrepreneurship, 
innovation and technology development, and facilitate job creation, including in the 
tourism sector, while taking into account environmental and social concerns.  

As for sector-specific infrastructure investments, the “Development of Environment 
and Transport infrastructure” Operational Programme (OP DETI) aims to create the 
conditions for growth by providing sustainable mobility, improving the quality of the 
environment  and  constructing  suitable  and  sustainable  infrastructure.  In particular, 
the  programme  will  help  to  attain  one  of  the  core  objectives  defined  in  the  NSRF, 
namely  ensuring  a  balanced  regional  development  throughout  the  entire  country. 
Concrete activities of the OP include, for instance, the construction/modernisation of 
428  km  of  railways  (TEN-T),  the  reconstruction/modernisation  of  215  km  of  roads 
(65 km of which on TEN-T), an increase in the population share served by adequate 
water  supply  to  96%,  the  connection  of  an  additional  700  000  people  to  public 

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sewerage  and  the  provision  of  additional  renewable  energy  capacity,  thus  reducing 
energy the intensity and emission of CO2 and other air pollutants. 

The “Human  Resource  Development” Operational Programme (ESF) aims to  boost 
human capital towards greater innovation capacity and employability and contribute 
to  improved  labour  market  flexibility  while  guaranteeing  employment  security,  in 
particular through job creation, and promoting social inclusion. Particular emphasis 
is  also  given  to  improvement  institutional  and  administrative  capacity  to  help 
accelerate  economic  growth  in  Slovenia.  Among  other  objectives  the  programme 
estimates 
from  different  ESF 
co-financed activities. It aims to increase adult participation in lifelong learning from 
15.3% to 20.7%, the share of researchers in the business sector from 41% to 50% and 
the employment rate of young people from 35.3% to 38% and of older workers from 
33.5% to 43.5%. 

that  270  000  participants  will  benefit 

2000-2006 programming period 

22.1.  Objective 1 

Slovenia  is  considered  to  be  a  single  Objective  1  region  for  the  period  2004-2006. 
From  the  very  beginning,  Slovenia  intended  to  use  the  EU  Structural  assistance  of 
EUR 237.5 million to achieve further convergence with the EU in terms of economic 
and  social  development  and  to  mitigate  internal  imbalances  within  the  country. 
The Single Programming Document (SPD) 2004-2006  forms  the  legal  basis  for  the 
use  of  structural  funds  in  Slovenia  and,  more  importantly,  defines  Slovenia’s 
strategic  objectives  to  be  achieved  in  the  framework  of  Cohesion  Policy.  The  total 
planned  public  expenditure  for  the  SPD  amounts  to  EUR  334.5  million.  The  total 
financial  contribution  from  the  four  structural  funds  (ERDF,  ESF,  EAGGF,  FIFG) 
for the 2004-2006 period amounts to EUR 237.5 million, of which 57.5% is covered 
by the ERDF, 31.8% by the ESF, 9.9% by the EAGGF and 0.8% by the FIFG.  

The strategic focus of the SPD is on the following themes: 

–  competitiveness of the productive sector 

–  development  of  human  resources  and  employment  (creation  of  new  jobs  and 

securing existing jobs) 

–  restructuring of the agricultural sector, forestry and fisheries 

–  improvement  of  competitiveness  in  the  different  regions  and  areas  as  well  as 

balanced regional development. 

Implementation of the SPD continued at a satisfactory pace in 2007 for the majority 
of  the  funds.  In  particular,  the  absorption  of  ERDF  funds  increased  steadily. 
Payments authorised by the Commission up to the end of 2007 amounted to 86% of 
the total ERDF contribution to the programme, an increase of 23% over the previous 
year.  For  the  other  funds,  absorption  was  somewhat  slower  in  the  first  half  of  the 
year but picked up noticeably towards the end. The cumulative amount of payments 
actually paid out by the end of 2007 (including advance payments) for all four funds 
amounted to around EUR 173 million, which corresponds to approximately 73% of 
the  total  Structural  Funds  contribution  for  the  SPD.  No  cases  of  automatic 

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decommitment under the “n+2” rule for the ERDF, ESF, EAGGF or FIFG arose at 
the end of 2007.  

As regards financial execution of the EAGGF-Guidance Section, payments made by 
the  Commission  for  Slovenia’s  Objective  1  programme  in  2007  amounted  to 
EUR 7.836 million. In 2007, 74.79% of the amount committed for the year 2006 was 
spent and at the end of 2007 cumulative EAGGF-Guidance payments for the period 
2004-2006 reached 89.10% of total programme commitments. 

Monitoring committee meetings 

The  SPD  monitoring  committee  meeting  took  place  in  Slovenia  in  June  2007  and 
provided  the  opportunity  to  review  project  implementation  of  the  programme, 
financial  management  and  the  main  outcomes  achieved  during  2006.  During  the 
meeting,  representatives  of  the  managing  authority  and  the  line  ministries  made 
detailed  presentations  of  the  progress  of  implementation  for  each  priority  and  the 
specific  measures.  This  included  presentations  of  several  co-financed  projects  to 
illustrate  what  had  been  achieved  with  the  support  of  the  Structural  Funds  on  the 
ground. Overall, the committee members considered the implementation of the SPD 
to  be  successful.  In  particular,  it  was  noted  that  the  selection  procedures  and 
to  previous  years. 
execution  of  projects  had 
The managing authority reported that, notably for the ERDF, more than 100% of the 
available Structural Funds allocation had been tendered and allocated by mid-2007. 
In terms of results, it was highlighted, for instance, that almost 6000 SMEs have been 
supported  through  SPD  assistance,  21  business  zones  have  been  established  and 
around 400 investments on farms have been carried out. 

in  comparison 

improved 

The  monitoring  committee  approved  the  2006  Annual  Implementation  Report  and 
agreed  to  the  proposed  changes  of  the  SPD  Programme  Complement  concerning 
measure 1.3. “Improving the support environment for entrepreneurship” and measure 
2.3 “Lifelong learning”.  

On the day before the meeting, the members of the Committee had the opportunity to 
visit a selection of Community-funded projects (ERDF, ESF, EAGGF) as part of the 
work  agenda  for  the  monitoring  committee.  This  allowed  them  to  obtain  first-hand 
impressions  of 
to  discuss  project 
implementation and possible problems with the final beneficiaries.  

the  programme’s  outcomes  as  well  as 

Annual Reports and annual meeting 

As  in  previous  years,  the  Annual  Implementation  Report  for  2006  was  received  in 
good  time  and  was  accepted  by  the  Commission  with  certain  comments  and 
recommendations for improvement.  

in  Ljubljana 

The  SPD  annual  meeting  was  held 
in  December  2007. 
The meeting considered all aspects of implementation, with special reference to audit 
activities  that  had  been  carried  out  by  the  Commission.  The  ESF  audits  revealed 
major weaknesses in monitoring and controls system. Consequently, in the summer 
the managing authority submitted an Action plan to the Commission and proposed a 
10%  financial  correction.  The  Commission  accepted  the  Action  plan  and  the 
correction.  Due  implementation  of  the  action  plan  was  confirmed  by  a  follow-up 
audit  in  November.  The  Annual  meeting  also  stressed  the  need  for  further 

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improvements to the monitoring systems in order to obtain a meaningful analysis of 
quantitative  and  qualitative  results  and  indicators.  It  was  also  noted  that  financial 
reallocation among ESF measures will be necessary and that ESF expenditure had to 
be accelerated during 2008. 

Amendments 

At the request of the national authorities and following approval by the monitoring 
committee,  the  SPD  Programme  Complement  was  amended  once  during 2007. 
The amendment did not entail any changes to the financial plan.  

The use of technical assistance  

The  SPD  operational  technical  assistance  programme  includes  a  specific  priority 
designed  to  ensure  the  right  conditions  for  effective  implementation  of  the 
development strategy, and to facilitate the implementation, management, follow-up, 
control  and  evaluation  of  the  programme.  This  priority  is  co-financed  both  by 
the ERDF and the ESF.  

Fisheries  

The  total  FIFG  allocation  committed  to  the  measures  “Modernisation  of  existing 
vessels  and  small-scale  coastal  fisheries”  and  “Aquaculture,  Processing  and 
Marketing”  within  the  SPD  for  structural  assistance  in  Slovenia  under  Objective  1 
(2004-2006) amounts to EUR 1 781 040, of which an amount of EUR 1 434 752.47 
was certified before the end of 2007. Legally binding commitments were reported to 
have  covered  the  whole  FIFG  allocation.  The payment  limit  of  95%  was  not  yet 
reached (35.81%); payments to the Member State amounted to EUR 637 799.7. 

22.2.  Community Initiatives  

22.2.1.  Equal 

The Slovenian EQUAL programme proceeded with some difficulties and, at the end 
of 2007, the rate of financial execution of the ESF part of the programme remained 
low,  at  only  46.33%,  or  EUR  2.86  million  (including  PoA).  Due  to  low  financial 
execution  by  the  end  of  2006  and  the  “n+2”  rule,  automatic  decommitment  of  the 
2004 budget was carried out in the sum of EUR 0.276 million in 2007.  

The audit of the system carried out by the BSO (Budget Supervising Office) in 2006 
found  out  that  management  and  control  systems  for  CIP  EQUAL  were  deficient  in 
certain parts and therefore recommendations for rectification of the deficiencies were 
issued. An audit on the observance of these recommendations performed by the BSO 
in  spring  2007  and  again  at  the  end  of  2007  found  out  that  the  progress  has  been 
made  in  respect  of  the  majority  of  the  recommendations  issued.  It  also  noted 
significant turnover of managing authority staff. 

In 2007, the BSO carried out an audit of eligible expenditure for the SPD. The BSO 
selected  the  company  Deloitte  to  perform  the  audit  of  eligible  expenditure. 
These reports  have  not  yet  been  sent  to  the  Commission.  No  other  EQUAL  audits 
have been carried out in Slovenia so far. 

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The  managing  authority  held  two  monitoring  committee  meetings,  one  in  June  and 
one in December. An Evaluation Steering Group held two meetings, one in January 
and one in June. A Workshop on final reports for the development partnerships was 
held in September 2007, while the final EQUAL conference and the second national 
thematic network meeting took place n 23 October 2007. 

No amendments were made to the programme. 

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23. 

FINLAND 

2007-2013 programming period 

The  five  regional  ERDF  programmes  (Eastern,  Northern,  Western  and  Southern 
Finland and Åland Islands) and the two ESF programmes (Mainland Finland and the 
Åland  Islands)  were  adopted  by  the  Commission  in  autumn  2007.  The  first 
commitments and advance payments were executed for all seven programmes before 
the end of 2007. The main strategic priorities of the programmes are the promotion 
of  business  activity,  innovation  activity  and  networking,  consolidating  knowledge 
structures, and improving regional accessibility and operational environments.  

The  2007-2013  ERDF  programmes  and  the  Mainland  Finland  ESF  programme 
started  implementation  in  the  autumn  of  2007.  A  kick-off  event  took  place  in 
October  2007 
in  Helsinki.  Director-General  Ahner  from  DG  REGIO  and 
Director Stub  Jörgensen  from  DG  EMPL  participated.  The  first  monitoring 
committee  meetings  for  the  Mainland  Finland  ERDF  and  ESF  programmes  took 
place at the end of year 2007 and for the Åland Islands programmes in January 2008. 
During  the  first  monitoring  committee  meetings,  the  rules  of  procedure  and  the 
selection  criteria  for  the  programmes  were  adopted  and  the  allocations  of  technical 
assistance  were  decided.  The  start  of  implementation  of  the  programmes  and 
communication  activities  was  also  discussed.  No  annual  review  meetings  for  the 
2007-2013 programmes were organised in 2007. 

2000-2006 programming period 

For  the  2000-2006  period,  Finland  was  allocated  EUR  2  120  billion  (1999  prices) 
from  the  Structural  Funds,  of  which  approximately  60%  ERDF,  26%  ESF, 
13.5% EAGGF  and  0.5%  FIFG.  The  funds  were  allocated  to  two  Objective  1 
programmes,  three  Objective  2  programmes,  two  Objective  3  programmes, 
one FIFG programme,  nine  IINTERREG  programmes,  one  URBAN  programme, 
one LEADER programme and one EQUAL Community Initiative programme.  

and  Employment 

the  Regional  Competitiveness 

For  the  2007-2013  programming  period,  Finland  was  allocated  EUR  1.596  billion 
under 
and 
EUR 120 million  under  the  Cooperation  objective,  totalling  EUR  1.7  billion. 
Of this amount,  64%  is  ERDF  and  36%  ESF  funding.  The  Eastern  and  Northern 
Finland regions benefit from a special allocation from the ERDF, based on their very 
sparse  populations,  in  the  amount  of  EUR  35  per  inhabitant  per  year,  totalling 
EUR 359  million.  The  whole 
the 
Regional Competitiveness  and  Employment  objective,  with  Eastern  Finland  as  a 
phasing-in  region.  The  Finnish  Structural  Fund  strategy  for  2007-2013 
is 
implemented through five regional ERDF programmes and two ESF programmes.  

territory  of  Finland 

is  eligible  under 

objective 

23.1.  Objective 1 

In  2007,  the  Northern  and  Eastern  Finland  Objective  1  programmes  progressed  as 
planned.  At  national  level,  EU  funds  were  fully  committed  to  projects  and 
over 82% of  EU  funding  was  paid  to  final  beneficiaries.  At  Commission  level, 
100% of the programme funds was committed by the end of 2007 and over 87% of 

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programme funds had been paid to Finland, including advance payments. No “n+2” 
decommitments have been made for any of the programmes.  

The  two  programmes  were  amended  in  March  2007  for  the  last  time  following 
requests  from  the  Member  State  submitted  in  December  2006.  The  amendments 
concerned  the  shifting  of  funds  within  priorities  in  order  to  ensure  full  use  of 
programme 
period. 
end 
Both programme complements were adapted twice during 2007.  

programming 

towards 

funds 

the 

the 

of 

No monitoring committee meetings were organised for the two programmes in 2007. 
The  2006  annual  reports  were  adopted  by  written  procedure.  The annual  review 
meeting between the Commission and the Finnish Managing authority was organised 
in February 2008 and dealt mainly with the progress of programme implementation, 
closure  preparations  and  management  and  audit  issues,  including  an  action  plan 
proposed  to  Finland  to  improve  the  operation  of  their  management  and  control 
system in respect of the 2000-2006 programming period. 

The  quantitative  and  horizontal  objectives  set  for  the  programmes  have  been 
achieved.  The  programmes  have  helped  to  create  nearly  40 000  jobs  and 
8 300 enterprises.  Over  250  000  people  have  participated  in  ESF measures. 
In addition, the programmes have strengthened the role of regions, fostered regional 
identity  and  responsibility  for  local  development,  improved  multi-annual  strategic 
planning, and promoted partnership and cooperation between the different levels of 
public  administration  and  other  stakeholders.  New  methods  and  models  have  been 
created in the field of employment and education and training policies. 

Fisheries 

FIFG  implementation  in  the  Objective  1  programmes  is  progressing  well. 
For the Northern programme, the commitment rate at the end of the year was 100%, 
while  the  95%  limit  has  been  reached.  The  Objective  1  Eastern  programme  had  a 
rule-related 
100%  commitment 
decommitments were necessary for the FIFG. 

rate  and  92%  payment 

rate.  No  “n+2” 

23.2.  Objective 2 

In  2007,  the  three  Finnish  Objective  2  programmes  for  Southern  Finland, 
Western Finland and the Åland Islands progressed as planned. At national level, over 
100% of EU funds had been committed to projects and over 80% of EU funding had 
been  paid  to  final  beneficiaries  in  Southern  and  Western  Finland,  and,  for  the 
Åland Islands,  the  funds  are  virtually  fully  committed  and  payment  levels  close  to 
70%. At Commission level, 100% of the programme funds had been committed by 
the end of 2007 and over 88% of programme funds paid to the national authorities, 
including advance payments. The programmes had no “n+2” decommitments.  

The  Southern  and  Western  Finland  programmes  have  helped  to  create  nearly 
40 000 jobs  and  over  7  500  enterprises.  Over  180 000  people  have  participated 
in ESF  measures.  The  horizontal  targets  for  equality,  environmental  sustainability 
and  information  society  have  been  reached,  apart  from  gender  equality  projects 
in Southern  Finland,  where  only  50%  of  the  target  has  been  met.  Due  to  very 
ambitious  target  setting,  the  target  for  creating  new  enterprises  will  only  be  partly 
for  Southern  Finland. 
met: 

for  Western  Finland 

50% 

52% 

and 

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The Mid-Term Evaluation  updates  concluded  that  the  programmes  have  brought 
added value to the regions, improved the competitiveness in the area and helped to 
decentralise  regional  research  and  development.  The  Åland  Islands  Objective  2 
programme has helped to create around 200 new jobs and 30 new enterprises.  

The two mainland Finland programmes were amended in April 2007 for the last time 
following requests from Finland in December 2006. The amendments concerned the 
shifting  of  funds  within  priorities  in  order  to  ensure  full  use  of  programme  funds 
towards the end of the programming period. The programme complements were then 
adapted 
The Åland 
programme 
programme complement was amended once in 2007.  

amendments. 

line  with 

the 

in 

No monitoring committee meetings were organised for the two mainland Objective 2 
programmes  in  2007.  The  2006  annual  reports  were  adopted  by  written  procedure. 
For  the  Åland  Islands,  two  monitoring  committee  meetings  were  organised  in  May 
and November 2007. The main items on the agenda were the progress of programme 
implementation, the 2006 annual report, preparations for closure and the preparations 
for the 2007-2013 period. 

The  annual  review  meeting  for  Mainland  Finland  programmes  was  organised  in 
February  2008  in  Brussels  and  dealt  mainly  with  the  progress  of  programme 
implementation, closure preparations and management and audit issues, including an 
action  plan  proposed 
their 
to 
2000-2006 management  and  control  system.  The  Åland  Islands  annual  review  was 
handled by written procedure in spring 2008.  

the  operation  of 

to  Finland 

improve 

At national level, ERDF funding by the end 2007 had been granted to 825 projects 
and  3.55%  of  ERDF  funds  had  been  committed  to  the  value  of  EUR 34.6  million. 
Payments to projects had reached EUR 1.2 million. The programmes have helped to 
create 170 new enterprises and 2 700 new jobs. ESF funding had not been committed 
by the end of 2007. 

23.3.  Objective 3 

ESF  funding  for  Finland’s  Objective  3  SPD  (including  the  Åland  Islands)  totals 
EUR 436.6  million.  The  programme  has  progressed  well.  By  the  end  of  2007, 
commitments totalled 100% and payments 87.05% for the mainland and 84.86% for 
the Åland programme. 

Altogether,  472  000  people  had  participated  in  the  activities  of  the  mainland 
Objective  3  programme  by  the  end  of  2006.  The  programme  has  helped  to  create 
more than 8.000 new enterprises and 18 000 new jobs. More than 27.000 jobs have 
been preserved.  

Monitoring committee meetings and Annual meeting 

Two joint monitoring committee meetings for the new and the old period took place 
in  Helsinki  on  24.5.2007  and  4.12.2007.  The  Annual  Review  meeting  was  held  in 
Helsinki  on  3.12.2007.  The  main  issues  discussed  at  the  Annual  Review  meeting 
were implementation of the programme, the new programming period, and follow-up 
of  the  audit  reports.  A  major  change  in  the  Finnish  administration  will  take  place 

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following the elections of 2007 and the new government Vanhanen II. The first step 
is the formation of a new Ministry of Employment and the Economy. 

Amendments 

programme 

amendments,  with 

100% 
Some  minor 
financial implementation of all Structural Funds funding, were introduced and some 
amendments to the annexes were proposed, in line with administrative and legislative 
changes  in  the  Ministry  of  Labour  in  2006.  The  final  Commission  decision  was 
adopted on 7.6.2007. 

aim 

the 

of 

Implementation  of  the  Åland  Islands  Objective  3  programme  continues  to  progress 
very well. By the end of 2007, everything had been committed and the Commission 
had  paid  out  75%  of  the  total  budget.  Altogether,  3  000  people  had  participated  in 
projects  of  the  Åland  Islands  Objective  3  programme  by  the  end  of  2007. 
Two monitoring committee meetings for Objectives 2 and 3 were held jointly during 
2007. The Annual Review was dealt with by written procedure. 

23.4. 

Fisheries outside Objective 1 

The  programme  progressed  better  than  in  the  previous  year,  although  in  the 
Ǻland islands progress was still slightly slower than in the rest of the country.  

The overall commitment rate at the end of the year was 98%, while 87% of the FIFG 
financing was paid out. 

23.5.  Community Initiatives  

23.5.1.  Equal 

The Finnish programme proceeded without difficulties in 2007. At the end of 2007, 
the  rate  of  financial  execution  of  the  ESF  part  of  the  programme  was  81%  of 
the total.  Automatic  decommitment  under  the  “n+2”  rule  was  avoided  for  2007. 
The managing authority organised one monitoring committee meeting and a closure 
seminar. Finland has decided to run down the EQUAL programme, in coordination 
with  the  other  period  2000-2006  ESF  programmes.  No amendments  were  made  to 
the programme. 

23.5.2.  Leader 

In  2001, 
25 Local Action  Groups 
national network. 

the  Commission  approved  one  Leader+  programme  for  Finland; 
(LAGs)  were  selected  and  are  supported  by  a 

implementation  of 

After  six  years  of 
the  programme,  an  amount  of 
EUR 46.36 million (82.23%) has been paid, out of the EUR 56.38 million committed 
there  were  no 
for  2001-2006.  During 
automatic decommitments. 

implementation, 

the  years  of 

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23.5.3.  Urban 

The Helsinki-Vantaa URBAN II programme is the only one in Finland. The ERDF 
will  contribute  a  total  of  EUR  5.38 million  to  this  programme,  for  which  total 
eligible  cost  amounts  to  EUR  20.37 million.  The  managing  authority  for  the 
programme  is  the  City  of  Helsinki  and  the  functional  day-to-day  management  is 
delegated to URBAN Helsinki-Vantaa. The  monitoring committee  met once during 
2006. 

The “n+2” target was met in 2007.  

Overall comments concerning the 2000-2006 period  

The programme has increased the social capital in the area and the participation of 
citizens  has  become  more  evident.  New  networks  have  been  established  between 
authorities,  citizens,  homes  and  schools,  making  for  a  new  approach,  especially 
on social issues. 

23.6.  Closure of the 1994-1999 programming period 

All  Finnish  Structural  Fund  programmes  from  the  1994-1999  programming  period 
were closed before 2006. 

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24. 

SWEDEN 

2007-2013 programming period 

During the spring of 2007, several meetings were held with the Swedish authorities 
to negotiate and discuss the NSRF and the new Operational Programmes. The NSRF 
was  accepted  by  Commission  decision  of  20  July  2007,  and  the  eight  ERDF 
Operational Programmes  were  finally  approved  between  9  and  16  August  2007. 
The ESF Operational Programme was approved on 25 September 2007. 

2000-2006 programming period 

General Objectives 1 and 2 

There are two Swedish Objective 1 programmes, Norra Norrlandsregionen and Södra 
Skogslänsregionen,  which  together  cover  65%  of  Sweden’s  land  area  but  have  a 
population of less than one million (11% of total population). The total support from 
the  Structural  Funds  for  the  period  2000-2006  is  EUR  780  million,  of  which  the 
ERDF  share  is  almost  EUR  490  million  or  63%,  ESF  EUR  164  million,  EAGGF 
EUR  116  million  and  FIFG  EUR  10  million.  Including  national  public  and  private 
participation, the Structural Funds will generate assistance of EUR 2.1 billion. 

There  are  four  Objective  2  programmes:  the  North,  West,  South  and  the  Islands 
programmes, with total Structural Funds support of EUR 440 million for the period 
2000-2006  (ERDF  EUR  385  million  or  88%,  ESF  EUR  55  million  or  12%). 
The programmes  cover  approximately  16%  of 
the  Swedish  population. 
Including national public and private participation, the Structural Funds will generate 
assistance of EUR 1.5 billion. 

In  total,  more  than  16 000  projects  have  been  started.  For  instance,  a  number  of 
venture  capital  and  mutual  guarantee  projects  have  been  approved  since  2005. 
These projects have gained a lot of attention and interest. 

By  the  end  of  December  2007,  the  Swedish  programmes  (all  funds)  had  created 
more than  110 000  new  or  preserved  jobs  and  more  than  21 000  new  companies. 
Studies performed in 2005 on a couple of the programmes indicate that the majority 
of these jobs and companies are still there a year after the projects ended. 

Annual Review meeting  

The  Annual  Review  meeting  between  the  Commission  and  the  Swedish  authorities 
and  the  managing  authorities  for  Objectives  1  and  2  was  held  in  Brussels  on 
11 October  2007.  The  meeting  was  devoted  to  an  exchange  of  information 
on the continued  development  of  the  programmes  (and  further  information  on  the 
procedures  for  closure  of 
that 
the programmes  were  progressing  well  and  that  Sweden  is  well  prepared  for 
the programme  closure  exercise.  The  Commission  did  not  request  any  additional 
information or follow-up.  

the  programmes).  The  meeting  concluded 

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Information and publicity 

Being at the end of the programming period, the focus of the programmes has shifted 
over the last few years towards measures to present and promote positive results and 
good  examples  (for  instance,  an  evaluation  has  shown  that  the  positive  effects  of 
the programme  remain  more  than  a  year  after  the  projects  have  finished:  100%  of 
the new jobs, 90% of the new companies and more than 100% of the new networks 
are  still  there).  Several  of  the  programmes  have  therefore  produced  brochures  with 
key results and examples of best practice, such as Objective 2 Södra in 2007.  

24.1.  Objective 1 

ERDF and EAGGF-Guidance Section 

Implementation of the Objective 1 programmes is running smoothly. By the end of 
2007,  more  than  100%  of  the  total  2000-2006  Structural  Funds  budget  had  been 
allocated  to  projects  (taking  into  account  flow-backs  into  the  programme)  and 
approximately  93%  (83%  in  2006)  had  been  paid  out  to  projects.  Payment  claims 
presented  to  the  Commission  by  the  end  of  2007  were  94.5%  of  the  total  ERDF 
budget  and  large  enough  to  avoid  any  automatic  decommitments.  By  the  end  of 
2007, the Commission had paid out 87% of the total ESF budget, more than enough 
to avoid any automatic decommitments. Execution of the EAGGF was 87.43% of the 
funds available and no decommitment following the “n+2” rule was necessary. 

On 27 April 2007, a joint monitoring committee meeting was held for both Objective 
1 programmes. Besides reports on the progress of the programmes and a discussion 
on  lessons  to  be  learnt  from  the  2000-2006  period,  the  agenda  included  brief 
information of the 2007-2013 programming period in Sweden.  

The 2006 annual implementation reports were received on 29 June 2007, and, after a 
review, the Commission considered the reports to be acceptable on 29 August 2007. 
The reports were also discussed in the context of the annual review meeting, where 
some proposals for improvements were made, for instance, as regards the link to the 
new integrated guidelines for growth and employment (adopted in 2005).  

24.2.  Objective 2 

All four programmes are progressing very well. At the end of 2007, approximately 
101.5% (101% in 2006) of the total 2000-2006 budget for ERDF had been allocated 
and approximately 91% (81% in 2006) had been paid out to projects. At the end of 
the year, the Commission had paid out between 87% and 95% of the ERDF budget 
for 
any 
automatic decommitment. 

respective  programmes,  which  was 

sufficient 

avoid 

the 

to 

A joint monitoring committee meeting was held for all four Objective 2 programmes 
on 6 March 2007. Besides reports on the progress of the programmes, a discussion 
on  lessons  to  be  learnt  from  the  2000-2006  period,  and  brief  information  on  the 
2007-2013  programming  period  in  Sweden,  the  agenda  included  a  presentation  by 
Nordregio on the effects of Structural Funds 2000-2006.  

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The  annual  implementation  reports  for  2006  were  received  by  the  Commission  on 
3-5  July  2007  and  were  accepted  on  19  July  (Objective  2  Västra)  and 
21 August 2007  respectively.  The  reports 
the 
programmes  were  progressing  well,  but  that  the  description  of  the  “5%  controls” 
should be further developed and at least contain information on the percentage level 
of the controls actually performed, as well as on how the programme intends to reach 
the  5%  target.  These  issues  were  later  discussed  at  the  Annual  Review  meeting  on 
11 October 2007, where a number of proposals for improvements were made.  

this  year  again  showed 

that 

During the year, some of the regions and special interest groups actively participated 
in the debate on the future cohesion policy. 

24.3.  Objective 3 

There  is  one  Objective  3  programme  with  total  Social  Fund  support  of 
EUR 780 million for the period 2000-2006. More than 100% of the total 2000-2006 
Social  Fund  budget  has  been  allocated  to  projects  (taking  into  account  flow-backs 
into  the  programme).  The  allocation  is  likely  to  come  down  to  100%  of  the 
Social Fund  budget.  By  the  end  of  2007,  the  Commission  had  paid  out  87%  of  the 
total ESF budget, more than enough to avoid any automatic decommitments. 

Implementation  of  the  Objective  3  programme  is  progressing  well.  In  total,  about 
50 000  projects  have  been  started.  Most  of  the  targets  set  in  the  programme  have 
been reached. For example, the number of participants is above the targets set for all 
priorities while the targets set for people finding a job after participation in an action 
have not been fully reached for all measures. The 2006 annual implementation report 
was received on 6 July 2007 and, after a review, the Commission has accepted the 
updated report. 

24.4. 

Fisheries outside Objective 1 

The total FIFG allocation to the Swedish fisheries programme outside objective 1 is 
EUR  54  014  745  for  the  period  2000-2006.  Due  to  the  rather  low  level  of 
implementation, and application of the “N+2” rule for the fourth consecutive year, a 
decommitment of EUR 333 920 could not be avoided at the end of 2007. All in all, 
the programme has been reduced by EUR 7.5 million. The Swedish authorities have 
put 
improve 
corrective  measures 
certain 
place 
programme implementation. 

designed 

in 

to 

The most important measures planned in line with the recent reform of the Common 
Fisheries Policy included scrapping of vessels, processing and marketing, innovative 
measures/pilot  projects,  fishing  port  equipment,  protection  of  aquatic  resources, 
collective investments, and renewal and modernisation of the fleet. 

Two meetings of the monitoring committee were held in 2007. 

24.5.  Community Initiatives  

24.5.1.  Equal 

The Swedish EQUAL programme proceeded without any major difficulties in 2007. 
At  the  end  of  the  year,  the  rate  of  financial  execution  of  the  ESF  part  of  the 

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programme  was  84%.  Automatic  decommitment  under  the  “n+2”  rule  was  avoided 
for 2007. 

Much was done to mainstream the results of the EQUAL programme through various 
national  thematic  networks  and  events  in  2007.  At  EU  level,  the  Swedish  EQUAL 
following  EU-wide  communication  and 
managing  authority  organised 
learning platforms: 

the 

–  Media  and  Diversity 

in  Paris 
in November 2007  at  UNESCO.  Its  training  toolkit  for  media  professionals  is 
being widely disseminated. 

learning  seminars  and  final  conference 

–  Policy Forum on Asylum seekers (Malmö, June 2007). The conclusions have been 
well  received  in  the  context  of  preparation  of  the  European  Policy  Plan  on 
Asylum. 

–  Community  of  Practice  on  Transnationality.  This  web-based  platform  is 

operational and serving all ESF MAs. 

–  Sweden has actively participated in the steering groups of two other platforms: 

–  Policy Forum on Diversity (led by France); 

–  Policy Forum on Business Creation and Social Economy (led by Germany). 

The EQUAL team is fully integrated in the new ESF Council structures in Sweden 
and active within the European ESF Technical Group. 

24.5.2.  Leader 

In  2001,  the  Commission  approved  one  Swedish  Leader+  programme.  In  total, 
twelve  Local  Action  Groups  were  selected.  Implementation  of  the  programme  is 
approaching  its  end.  By  the  end  of  2007,  approximately  109%  of  the  total 
EAGGF-Guidance  Section  budget  for  2000-2006  had  been  allocated  to  projects. 
During the seven years of implementation, no automatic decommitment has had to be 
executed.  Payment  claims  presented  to  the  Commission  up  to  the  end  of  2007 
amounted to EUR 33 986 695 from the EAGGF-Guidance Section, i.e. 82.46% of the 
programme’s total budget. 

24.5.3.  Urban 

The  Göteborg  URBAN  II  programme  is  the  only  one  in  Sweden.  The  ERDF 
contributes a total of EUR 5.38 million to his programme, whose total cost amounts 
to EUR 16.08 million. The annual implementation report for 2006 was submitted to 
the Commission in June 2007. 

The  managing  authority  for  the  programme  is  the  County  Administrative  Board  in 
Örebro  and  the  functional  day-to-day  management  is  delegated  to  the  URBAN 
Secretariat in Göteborg. The monitoring committee met twice during the year. 

The “n+2” target was met in 2007. 

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Overall comments concerning the 2000-2006 period  

The  programme  strategy  has  a  coherent  approach  combining  entrepreneurship, 
infrastructure improvement and equal opportunities.  

Implementation  is  satisfactory.  There  were  no  problems  with  meeting  the  yearly 
“n+2” targets of the programme. 

24.6.  Closure of programmes 1994 – 1999 

The last programmes from the budget period 1994-1999 were already closed in 2004.  

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25. 

UNITED KINGDOM 

2007–2013 programming period 

The  UK  NSRF  considers  the  five  factors  influencing  productivity  —  competition, 
enterprise, innovation, investment and skills — in order to identify areas of relative 
weakness  and  priority  for  action.  It  states  as  the  overall  economic  objective  of  the 
UK  government  to  raise  the  rate  of  sustainable  growth  and  achieve  increasing 
prosperity and a better quality of life with economic and employment opportunities 
for  all.  The  focus  of  the  ERDF  is  on  innovation,  enterprise  and  sustainable 
communities. With regard to the ESF, the objective across all UK nations will be on 
removing  barriers  of  disadvantaged  groups  to  enter  the  labour  market  as  well  as 
raising the skills level of the workforce.  

Following  discussion  on  a  number  of  technical  issues,  the  UK  NSRF  was  formally 
submitted  to  the  Commission  on  27  April  2007  and  the  Commission  adopted  a 
decision approving certain elements of the document on 30 July 2007.12 

The  ESF  allocation  to  the  UK  amounts  to  EUR  10  613  million  (at  current  prices). 
Almost  27.5%  of  this  amount  is  allocated  to  the  Convergence  objective  and 
‘phasing out’ regions.  

two  programmes  each 

The UK has submitted the following six ESF Operational Programmes, which reflect 
the  two  ESF  priorities  set  out  in  the  NSRF:  one  multi-objective  programme  for 
England  and  Gibraltar; 
for  Scotland  and  Wales, 
one per Objective; and one Regional Competitiveness and Employment Programme 
for Northern Ireland. The Commission adopted all Programmes between August and 
November  2007.  Advance  payments  for  all  UK  Programmes  amounted  to  almost 
EUR  89.5  million.  96%  of  the  ESF  programmes  allocation  is  earmarked  for 
Lisbon codes.  Programme  Monitoring  Committees  were  established  following 
adoption of the programmes, and projects are expected to start in April 2008.  

2000-2006 programming period 

25.1.  Objective 1 

(including 

The ERDF provided a total of EUR 3981 million to Objective 1 programmes in the 
United  Kingdom  during  the  programming  period.  FIFG  support  is  available  in  five 
Objective 1 programmes, for a total of EUR 96 million. The ESF provided a total of 
EUR  1881  million  to  Objective  1  programmes  in  the  United  Kingdom  during  the 
programming  period 
Ireland  BSP  programme). 
in  2007  was 
The total ERDF  amount 
EUR 578 million.  Further  claims  for  payment  were  made  before  the  end  of 
December  2007  and  these  will  be  paid  in  2008.  The  total  ESF  amount  paid  out  in 
2007 (excluding PEACE II) was EUR 233 million. For the EAGGF, the total amount 
(excluding  PEACE  II)  paid  by  the  end  of  2007  was  EUR  271  million  (76%  of  the 
scheduled  budget  for  the  2000-2007  programming  period,  i.e.  EUR  357  million). 
Further claims for payment were made before the end of December 2007 and these 

(excluding  PEACE 

II)  paid  out 

the  Northern 

12 

C(2007) 3583. 

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target:  Merseyside  missed 

will  be  paid  in  2008.  With regard  to  the  “n+2”  rule,  two  programmes  did  not  meet 
the  ESF  by 
the  2007 
EUR 14.8 million and the Highlands and Islands programme missed the “n+2” target 
for  the  EAGGF-Guidance  Section  by  EUR  247  651.  All  other  programmes  for  all 
funds met the “n+2” targets in 2007. 

the  “n+2” 

target  for 

Two  Objective  1  programmes  in  England  had  payments  suspended  for  the  ERDF 
during  2007  —  Merseyside  and  South  Yorkshire.  Following  further  work,  the 
suspensions were lifted by the end of the year.  

Assistance  is  provided  through  five  Single  Programming  Documents  and  two 
Operational Programmes. Three of the Single Programming Documents concern the 
English regions of Cornwall and the Isles of Scilly, Merseyside and South Yorkshire; 
the  other  two  Single  Programming  Documents  concern  Wales  (West  Wales  and 
The Valleys)  and  Scotland  (transitional  programme  for  Highlands  and  Islands). 
Each programme covers four to six priority areas, grouped around five main themes: 
support  for  small  and  medium-sized  business,  support  for  business  modernisation, 
community  economic  regeneration,  human  resource  development  and  development 
of strategic infrastructure. 

The  two  Operational  Programmes  under  the  Northern  Ireland  Community  Support 
Framework are funded by all four Structural Funds. They are: “Building Sustainable 
Prosperity” (BSP), a transitional Objective 1 programme, and the EU Programme for 
Peace  and  Reconciliation  in  Northern  Ireland  and  the  Border  Region  of  Ireland 
(“PEACE  II”  programme  2000–2006).  The  ESF  for  the  BSP  OP  amounts  to 
EUR 285 million.  

PEACE II 

The  “PEACE  II”  programme  builds  on  the  experience  of  the  special  support 
programme “PEACE I” (1995–1999) and exemplifies the practical support given by 
the EU to the peace process after the Belfast Agreement. Initially PEACE II covered 
the period 2000-2004 but in 2004 it was decided to provide additional funding and 
extend  the  programme  to  2006,  bringing  it  in  line  with  the  other  Structural  Funds 
programmes in the rest of the European Union. 

For  the  PEACE  II  programme,  the  ERDF  provided  EUR  368  million.  The  ESF  in 
PEACE  amounts  to  EUR  147  million  —  another  EUR  46  million  come  from  the 
Irish part of the programme, which brings the total to amounts to EUR 193 million. 
The total amount paid in 2007 was EUR 93 million. The total ERDF amount paid in 
2006  was  EUR  42  million.  In  the  case  of  the  ESF,  overall  payments  for  the  whole 
period  have  reached  close  to  90%  of  the  total  ESF  allocation,  i.e.  EUR  33  million. 
The  total  amount  paid  from  the  EAGGF-Guidance  for  the  PEACE  II  Programme 
managed  jointly  with  Ireland  was  EUR  38  million  (88%  of  the  budget  of 
EUR 44 million  for  the  years  2000-2004).  The  “n+2”  target  for  2007  was  met 
for all funds. 

25.2.  Objective 2 

The ERDF provides a total of EUR 4 325 million for Objective 2 programmes in the 
United  Kingdom,  and  the  ESF  a  total  of  EUR  528  million.  The  funds  are 
implemented  through  fourteen  Single Programming  Documents.  Nine  programmes 

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cover  the  English  regions  of  West  Midlands,  Yorkshire  and  the  Humber, 
East Midlands,  North  East  of  England,  North  West  of  England,  East  England, 
South East  England,  South  West  England  and  London;  three  cover  the  regions  of 
South of Scotland, East of Scotland and Western Scotland; one concerns East Wales; 
and  one  concerns  Gibraltar.  Each  programme  covers  an  average  of  three  priority 
areas,  grouped  around  three  main  themes:  developing  diverse,  dynamic  and 
competitive  business  bases,  strategic  spatial  development,  and  community 
regeneration  and  economic  and  social  development.  The  UK  Objective  2 
programmes  were  adopted  in  2001,  meaning  that  increasing  levels  of  activity  and 
progress  were  not  registered  until  2003.  The  total  amount  paid  in  2007  was 
EUR 317 million  for  the  ERDF  and  EUR  52  million  for  the  ESF.  Payment  claims 
submitted in December 2007 will be paid in 2008. With the exception of North West 
of England, all other Programmes met the ERDF “n+2” target in 2007. An amount of 
EUR 4.8 million was decommitted for the ERDF 2005 commitment. The remaining 
thirteen  Objective  2  programmes  claimed  sufficient  expenditure  to  meet  the  “n+2” 
target for all funds set by Article 31(2) of Council Regulation 1260/1999. 

Five  Objective  2  programmes  in  England  had  payments  suspended  for  the  ERDF 
during 2007 — North West, North East, Yorkshire and the Humber, West Midlands 
and  London.  All  but  one  of  the  suspensions  were  lifted  before  the  end  of  the  year 
following further work. ESF payment flows have also been difficult for the Scottish 
programme due to audit issues. 

Overall summary of the 2000-2006 period 

of 

key 

Programme  implementation  was  in  line  with  the  relevant  strategies  at  local  level 
across the UK, placing the emphasis on economic restructuring and regeneration, the 
development. 
development 
Monitoring indicators reveal that all Operational Programmes meet their targets and 
achieve  their  objectives.  In  addition,  evaluations  confirm  that  Structural  Funds 
assistance  has  had  a  positive  impact  on  the  areas  of  intervention  in  promoting 
economic  convergence  and  cohesion  between  the  regions,  as  well  as  employment 
and social inclusion. 

community 

economic 

sectors 

and 

25.3.  Objective 3 

The level of the expenditure in 2007 amounted to EUR 709 million, i.e. 86% of the 
ESF allocation.  

The  ESF  provides  a  total  of  EUR  4  948  million  for  Objective  3  programmes  in 
Great Britain,  implemented  through  one  Community  Support  Framework  and  three 
Operational Programmes: England (EUR 4 290 million), Scotland (EUR 520 million) 
and  East  Wales  (EUR  138  million).  The  total  amount  paid  in  2007  was  EUR 709 
million:  England  (EUR  678  million)  and  East  Wales  (EUR  31  million).  All  three 
programmes met their “n+2” targets for 2007. Payment flows have been difficult for 
the Scottish programme due to audit issues. 

For  the  Scottish  OP  two  meetings  of  the  Programme  Monitoring  Committee  took 
place,  for  England  three  and  for  Wales  none.  All  three  Annual  Implementation 
Reports were received. They were considered admissible and satisfactory.  

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25.4. 

Fisheries outside Objective 1 

The  UK  outside  Objective  1  Fisheries  programme  covers  most  of  England,  all  of 
Scotland except Highlands and Islands and a very small part of Wales.  

The  total  FIFG  amount  allocated  over the  period  2000-2006  is  EUR  125.5  million, 
almost half of it for Scotland. Implementation of the programme has been slow and 
for  the  fourth  consecutive  year  the  programme  will  have  to  be  reduced  due  to  the 
application  of  the  “n+2”  rule.  After  the  last  decommitment  of  approximately 
is 
tranche, 
EUR 6.3  million  from 
EUR 93.2 million,  all  of  which  is  committed.  With  EUR  4.3  million  to  be 
decommitted from the 2005 tranche, the original amount of the programme has been 
decreased from EUR 125.5 million to EUR 88.9 million, i.e. by EUR 36.6 million, or 
30%.  Due  to  the  “n+2”  rule,  the  programme  has  lost  about  25%  of  its  initial 
allocation.  The  corrective  measures  put  in  place  by  the  UK  authorities  have  had 
little effect. 

the  programme 

the  size  of 

the  2004 

Payments made to the programme total a little over EUR 50 million, i.e. 56.33% of 
the payment limit.  

Limited  assurance  was  credited  to  the  functioning  of  the  PA  following  the 
DG MARE audit mission to England in September 2007.  

25.5.  Community Initiatives  

25.5.1.  Equal 

The UK has two EQUAL programmes: Great Britain (gb) and Northern Ireland (ni).  

The  UKgb  EQUAL  programme  continued  without  any  major  difficulties  in  2007. 
At the  end  of  2007,  the  rate  of  financial  execution  of  the  ESF  was  84.86%  of  the 
total.  Automatic  decommitment  under  the  “n+2”  rule  was  avoided  for  2007. 
Payments in 2007 amounted to EUR 109 360 080.  

Implementation  of  the  UKni  programme  continued  with  no  major  difficulties 
target  for  2007  was  achieved.  In  December  2007, 
in 2007.  The  “n+2” 
the Commission  adopted  a  decision  amending  the  financial  tables  and  approving 
the transfer  of  EUR  600  000  from  Priority  4  (Equal  Opportunities)  to  Priority  1 
(Employability). At the end of 2007, the rate of financial execution for the ESF was 
83.24%. Payments in 2007 amounted to EUR 1 974 378. 

25.5.2.  Leader 

The  UK  has  four  Leader+  programmes:  England,  Northern  Ireland,  Scotland  and 
Wales,  with  fifty-five  Local  Action  Groups.  The  total  cost  of  the  four  programmes 
amounts  to  EUR  266  million,  of  which  the  EAGGF-Guidance  Section  contributes 
EUR 115 million.  

By  the  end  of  2007,  a  total  amount  of  EUR  80  million  had  been  paid  (70%  of  the 
total budget for the 2000-2006 programming period). 

All programmes reached their “n+2” targets. 

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25.5.3.  Urban 

In  the  UK  the  ERDF  supports  eleven  programmes  under  the  URBAN  II  initiative. 
These  programmes  propose  innovative  development  models  for  the  economic  and 
social  regeneration  of  the  areas  concerned  and  finance  projects  to  this  end. 
Partnership in design, selection and implementation of projects is a key feature of the 
URBAN II programmes.  

The  total  ERDF  support  allocated  to  the  11  programmes  in  the  UK  amounts  to 
EUR 126.2 million. In 2007, a total of EUR 16.6 million was paid out to URBAN II 
programmes in the UK, with total cumulative payments reaching EUR 98.3 million 
at year end.  

DG  REGIO  audits  revealed  problems  with  management  and  control  systems  in 
England,  leading  to  the  suspension  of  ERDF  payments  for  several  programmes. 
The URBAN  II  programmes  affected  by  suspension  were  Stockwell  (London), 
Burnley (North West of England), Halifax (Yorkshire and the Humber), Hetton and 
Murton (North East of England), and Peterborough (East of England). For the latter 
region, only payments to the URBAN II programmes were suspended, while in the 
other  regions  it  affected  all  ERDF  programmes.  Suspension  had  been  lifted  by  the 
end of 2007.  

In  2007,  attention  shifted  more  and  more  towards closure and legacy issues, which 
were also the focus of the annual UK Urban II Network meeting that took place in 
Belfast  on  13-14  March  2007.  Several  evaluations  are  to  be  conducted  in  2008, 
which  will  be  the  final  year  of  implementation.  Potential  areas  of  emerging  best 
practise  relate  to  strong  social  involvement  and  community  engagement,  with  the 
focus  on  specific  target  groups  such  as  young  people,  women  and  migrant 
population,  and  good  connections  of 
the  wider 
development area.  

the  programmes  with 

English Programmes  

Broadly speaking, the English URBAN II programmes are better at meeting socially 
related  targets  than  business-related  ones.  The  programmes  and  programme 
complements had to be adjusted to mirror this fact.  

By  the  second  half  of  2006,  the  focus  tuned  more  to  the  legacy  and  closure  of  the 
programmes.  The  results  of  this  were  discussed  in  the  UK  Network  Event  held  in 
North Belfast in 2007 March. 

The  Gies  for  the  programmes  are  the  regional  Government  Offices  in  England  and 
the  respective  Government  Department  in  other  parts  of  the  UK.  In  most  cases, 
however,  functional  responsibility  has  been  delegated  to  the  local  authority  most 
concerned. 

All  8  programmes  submitted  receivable  annual  implementation  reports  for  2006 
in summer 2007.  

There were regular monitoring committee meetings for each programme.  

All UK programmes met the “n+2” target for 2007. 

EN 

135 

   EN 

Northern Ireland, Wales and Scotland 

Since the second half of 2006 concentration has turned more and more to the legacy 
of the programmes. 

N+2  targets  were  met  for  2007.  The  annual  implementation  report  for  2006  was 
submitted in summer 2007. 

Overall comments for the 2000-2006 period in the United Kingdom  

The UK URBAN II programmes were very innovative and successful, especially in 
meeting the strategic aims of social inclusion, partnership  and  concentration on  the 
younger generations. Presumably these will have of the strongest impact on URBAN 
II legacy in the UK.  

The UK urban network and the regularly held network events based on URBAN II 
activities  are  also  worth  noting.  These  connections  are  very  strong  and  effective, 
which the programmes want to sustain in the future, including for best practice and 
exchange of experience in the field of urban development policy. 

For proper closure of the programmes, it is very important to tackle the problems in 
the  management  and  control  systems  found  in  the  UK.  To  this  end,  several 
action plans are being prepared by the British Authorities.  

25.6.  Closure of the 1994-1999 programming period 

Three  ERDF  programmes  were  still  partially  open  at  the  end  of  2007  due  to 
unresolved issues regarding irregularities. 

Two ESF programmes relating to the MARI/NRITEA irregularities were closed and 
the  recoveries  were  settled  during  2007.  Only  one  programme  remained  partially 
open  and  will  be  handled  during  the  first  quarter  of  2008.  As  a  follow-up  to 
discussions  with  OLAF  on  pending 
irregularities,  a  revised  final  claim, 
taking account  of  these  outstanding  irregularities  reported  to  OLAF,  arrived 
early January 2008. The total outstanding commitment (RAL) was 2.7 million. 

A  formal  procedure  for  an  Article  24  Commission  decision  to  apply  a  flat  rate 
financial correction was launched on 23/10/2007.  

All EAGGF programmes have been closed. 

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Part 3: List of Major Projects 

Given  the  fact  that  the  list  of  major  projects  has  not  changed  since  the  last  annual  report  was  published,  the  information  included  in  Part  3  of  the  18th 
Annual Report on the Implementation of the Structural Funds (COM(2007)676) remains valid and can be consulted for further details. 

EN 

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EN