Proposal for a regulation (EC) No …/2009 OF the European Parliament and of the Council amending Regulation (EC) No 1080/2006 on the European Regional Development Fund as regards the eligibility of housing interventions in favour of marginalised communities
Date: 2009-07-17
Institutions: European Commission
Subjects: EU Member State, European Regional Development Fund, Roma, aid to disadvantaged groups, housing need, living conditions, property market, rural development

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 17.7.2009 
COM(2009) 382 final 

2009/0105 (COD) 

Proposal for a 

REGULATION (EC) No …/2009 OF THE EUROPEAN PARLIAMENT AND OF THE 
COUNCIL 

amending Regulation (EC) No 1080/2006 on the European Regional Development Fund 
as regards the eligibility of housing interventions in favour of marginalised communities  

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EXPLANATORY MEMORANDUM 

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CONTEXT OF THE PROPOSAL 

•  Grounds for and objectives of the proposal 

The  proposal aims to permit  the ERDF financial support for  housing interventions in 
favour  of  marginalised  communities  living  in  the  Member  States  that  acceded  to  the 
European Union on or after 1 May 2004. In the new Member States, the great majority 
of  these  communities  live  in  rural  areas  and  in  shelters  (in  rural  as  well  as  in  urban 
areas) and they cannot benefit from the ERDF support.  

In fact, Article 7(2) of the ERDF Regulation1 provides for the eligibility of expenditure 
on housing in the new Member States. The experience to-date however, proves that the 
conditions of eligibility do not fully fit to the needs on the ground.  

Actually, under the current ERDF provisions, housing interventions can take place in 
the  framework  of  urban  development  operations  and  in  the  form  of  renovation  of 
existing  houses.  Therefore,  support  to  housing  interventions  in  rural  areas  or  for  the 
replacement  of  “houses”  of  a  very  poor  quality  in  urban  or  rural  areas  cannot  be 
eligible under the ERDF.  

There  is  a  growing  concern  and  commitment  of  the  EU  to  combat  social  exclusion, 
including the particular situation of Roma. The European Parliament2 and the Council3 
have  repeatedly  asked  the  Commission  to  take  action  to  promote  inclusion  of  these 
communities  facing  extreme  deprivation  and  marginalisation.  The  Commission  has 
taken  the  commitment  to  propose  -  in  the  framework  of  the  Structural  Funds  - 
measures to improve the living conditions of these communities.  

The  present  proposal  for  an  amendment  of  the  ERDF  Regulation  translates  this 
commitment.  

Moreover,  for  simplification  purposes, 
this  proposal  contains  minor  drafting 
modifications  of  the  current  Article  7(2)  of  the  ERDF  Regulation  relating  to  the 
framework  in  which  a  housing  intervention  in  urban  areas  shall  take  place  without 
however modifying the existing eligibility rules in favour of EU-12 In particular:  

i) Article 7(2) of the ERDF Regulation confers the Commission implementing powers 
for  the  definition  of  the  criteria  for  the  selection  of  areas  and  of  the  list  of  eligible 
housing  interventions.  The  Commission  exercised  its  powers  in  Article  47  of 
Regulation  (EC)  No  1828/2006.  However,  given  the  great  diversity  of  housing 
situation  on the ground, it has  been proved that the  criteria fixed by the Commission 
are not appropriate. Therefore, they are currently simplified. In order to take on board 
the simplification of Article 47 of Regulation (EC) No 1828/2006 currently in process 

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Regulation  (EC)  N°1080/2006  of  the  European  Parliament  and  of  the  Council  of  5  July  2006  as 
amended by Regulation (EC) N°397/2009, OJ L210, 31.7.2006, p.1. 
European  Parliament  resolution  of  11  March  2009  on  the  social  situation  of  the  Roma  and  their 
improved access to the labour market in the EU (2008/2137/INI). 
Council conclusions on the inclusion of the Roma, Luxembourg 8 June 2009. 

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it  is  proposed  to  provide  that  the  implementing  powers  conferred  to  the  Commission 
will be optional and not binding. 

ii) For clarity purposes, the eligible types of interventions in the existing buildings (the 
renovation of the common parts of residential buildings, the renovation and change of 
use of public owned buildings in order to transform them into “social housing”) should 
be included in the proposed Regulation.  

iii) Finally, the current wording of Article 7(2)  of  the  ERDF Regulation, expenditure 
shall  be  programmed  “within  the  framework  of  an  integrated  urban  development 
operation  or  priority  axis”  for  areas  experiencing  or  threatened  by  physical 
deterioration and social exclusion” needs to be improved. Therefore, it is proposed to 
replace  the  terms  “operation”  and  “priority  axis”  by  the  term  “integrated  approach”, 
which  ensures  that  a  housing  intervention  is  part  of  a  broader  intervention  including 
aspects  relating  to  housing  such  as  social  services,  public  spaces,  culture,  education, 
transport infrastructure, economic activities of the area etc regardless of the source of 
financing.  

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•  General context 

Access to housing and acceptable housing conditions for all citizens and, in particular, 
for the most vulnerable is a basic requirement of our society.  

Living conditions of communities facing extreme deprivation and marginalisation are –
in the great majority of cases- deplorable: High rate of unemployment, low educational 
level,  lack  of  skills,  lack  of  heath  services,  criminality,  spatial  segregation,  social 
exclusion, racism and evictions compose a bleak picture which contrasts with the core 
values of the European Union. 

The Structural Funds financial support can significantly contribute to the efforts of the 
National Authorities to put an end to this unacceptable situation. Therefore, allocations 
shall be made available also for housing interventions in favour of these communities 
currently ineligible under the ERDF, i.e. for i) housing interventions not limited to the 
urban  areas  and  ii)  housing  interventions  consisting  of  the  replacement  of  houses  of 
extremely poor quality, irrespectively of the area (“urban” or “rural”). 

In  order  to  avoid  unjustified  discriminations,  the  guiding  principle  of  the  proposed 
interventions should be the 2nd Basic Principle on Roma Inclusion according to which 
interventions focusing on Roma people as target group should not exclude other people 
sharing similar socio-economic circumstances4.  

Moreover, housing interventions in favour of marginalised communities characterised 
by  extreme  deprivation  are  only  part  of  a  complex  issue.  Therefore  they  should  be 
tackled in the framework of a multi-dimensional integrated approach, to be defined at 
national  level,  with  strong  partnerships  and  taking  on  board  aspects  relating  to 

4 

“Explicit but not exclusive targeting of the Roma is essential for inclusion policy initiatives. It implies 
focusing on Roma people as target group but not to the exclusion of other people who share similar 
socio-economic circumstances (…)”Common Basic Principles on Roma Inclusion as discussed at the 
1st meeting of the integrated European platform for Roma inclusion, April 2009, attached in the Council 
Conclusions on Inclusion of Roma, Luxembourg, 8 June 2009. 

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education, social affairs, integration, culture, health, employment, security etc. Hence, 
the  aim  of  the  proposal  amending  the  current  ERDF  Regulation  is  to  provide,  in  the 
framework  of  an  integrated  approach,  acceptable  housing  conditions.  In  this  context, 
the  role  of  public  authorities  at  all  stages  of  the  implementation  is  of  an  outmost 
importance.  

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•  Existing provisions in the area of the proposal 

With  the  exception  of  energy  efficiency  and  renewable  energies  intervention, 
accessible  to  all  Member  States,  ERDF  supported  interventions  in  the  housing  sector 
are reserved only for Member States that acceded to the European Union on or after 1 
May 2004, and under the conditions set out in Article 7 paragraph 2 of Regulation No 
1080/2006 and Article 47 of the Commission Regulation No 1828/2009.  

As  explained  above,  these  conditions  are  not  sufficient  to  tackle  the  specific  housing 
problem  of  marginalised  communities.  It  should  also  be  noted  that  EAFRD  already 
intervenes  in  the  housing  sector  in  rural  areas  under  Regulation  (EC)  N°  1698/2005 
(e.g.  Axis  3  “Quality  of  life  in  rural  areas  and  diversification  of  the  rural  economy”- 
Article 52(b)(ii) “village renewal and development”).  

Housing interventions in favour of marginalised communities in rural areas supported 
by  both  the  EAFRD  and  the  ERDF,  implemented  in  the  framework  of  integrated 
approaches, in which ESF can also contribute, will increase significantly the available 
financial support. It will be within the competence of the Member States to define, in 
the framework of an integrated approach, the complementarity between Funds in a way 
to optimise the synergy effect.  

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•  Consistency with the other policies and objectives of the Union 

The  proposal  is  fully  consistent  with  the  EU  policy  objectives  in  the  fields  of  non- 
discrimination,  equal  opportunities,  economic  and  social  cohesion, 
regional 
development and territorial cohesion. .  

2. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

•  Consultation of interested parties 

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Consultation methods, main sectors targeted and general profile of respondents 

National  Authorities,  as  well  as  representatives  of  marginalised  communities  and 
MEPs have been consulted informally on several occasions on the possibilities offered 
to  marginalised  communities  by  Article  7(2)  of  ERDF  Regulation,  the  obstacles  and 
the various options for counteracting them. 

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Summary of responses and how they have been taken into account 

The outcome of all these consultations was that solutions based on the interpretation of 
Regulation (EC) No 1080/2006 were not sufficient.  

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•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact assessment 

The present proposal permits the ERDF financial support for housing interventions in 
cases where marginalised communities living conditions are extremely poor and social 
exclusion  is  high.  This  could  not  be  possible  without  modification  of  the  existing 
regulatory framework. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Summary of the proposed action 

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3. 

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The  proposed  modification  to  Article  7(2)  of  Regulation  (EC)  No  1080/2006  on  the 
European  Regional  Development  Fund  seeks  to  permit  and  facilitate  housing 
interventions in favour of marginalised communities in the new Member States when 
the  current  provisions  cannot  apply.  Given  the  complexity  of  the  intervention,  it  is 
important  that  National  Authorities  proceed  in  the  framework  of  an  integrated 
approach.  

In  addition,  for  simplification  purposes,  minor  drafting  modifications  in  the  existing 
provision are proposed.  

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•  Legal basis 

European  Parliament  and  Council  Regulation  (CE)  No  1080/2006  on  the  European 
Regional  Development  Fund,  in  its  Article  7(2),  defines  the  eligibility  conditions 
applicable to the housing sector in the new Member States. 

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•  Subsidiarity principle 

The proposal complies with the subsidiarity principle to the extent that it broadens the 
possibilities for the new Member States to provide support to housing interventions in 
favour of marginalised communities in the way they consider more appropriate, while 
keeping  the  integrated  approach  as  a  minimum  condition  for  intervention.  This  will 
permit to intervene in way “capturing” the specificities of each community but with a, 
basically, common method.  

•  Proportionality principle 

The proposal conforms to the proportionality principle since it is limited only to permit 
the ERDF support in the housing sector in favour of marginalised communities and for 
cases where the current provisions cannot apply. This intervention is limited in those 
Member States where the problem currently exists.  

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•  Choice of instruments 

Proposed instrument: Regulation. 

The  Commission  has  already  explored  the  possibilities  offered  by  the  current 
legislation. Even with the most flexible interpretation, the current rules setting a limited 
eligibility  do  not  permit  housing  interventions  outside  the  urban  areas  or  the 
replacement  of  existing  shelters  by  houses  in  favour  of  marginalised  communities 
living in new Member States.  

BUDGETARY IMPLICATION 

The proposal has no implication for the Community budget. 

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2009/0105 (COD) 

Proposal for a 

REGULATION (EC) No …/2009 OF THE EUROPEAN PARLIAMENT AND OF THE 
COUNCIL 

amending Regulation (EC) No 1080/2006 on the European Regional Development Fund 
as regards the eligibility of housing interventions in favour of marginalised communities  

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
162 thereof, 

Having regard to the proposal from the Commission5, 

Having regard to the opinion of the European Economic and Social Committee6, 

Having regard to the opinion of the Committee of the Regions7, 

Acting in accordance with the procedure laid down in Article 251 of the Treaty, 

Whereas, 

(1)  With  the  view to  enhance  the economic and social cohesion of the Community, it is 
necessary  to  support  limited  interventions  for  the  renovation  of  existing  buildings 
serving housing purposes in Member States that acceded to the European Union on or 
after 1 May 2004. Those interventions can take place under the conditions set out in 
Article 7 (2) of Regulation (EC) No 1080/2006 of the European Parliament and of the 
Council  of  5  July  2006  on  the  European  Regional  Development  Fund  and  repealing 
Regulation (EC) No 1783/19998.  

(2) 

Expenditures  are  to  be  programmed  in  the  framework  of  an  integrated  urban 
development operation or priority axis for areas experienced or threatened by physical 
deterioration and social exclusion. For purposes of clarity, the conditions under which 
housing  interventions  in  urban  areas  can  take  place  should  be  simplified.  Therefore, 
expenditures  on  housing  interventions  should  be  programmed  taking  into  account 
different parameters regardless of the source of financing. It should also be stated that 
only expenditures on the interventions in existing buildings are eligible.  

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OJ C […], […], p. […]. 
OJ C […], […], p. […]. 
OJ C […], […], p. […]. 
OJ L 210, 31.7.2006, p. 1. 

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(3) 

(4) 

(5) 

(6) 

(7) 

In the Member States to which Article 7(2) of Regulation (EC) No 1080/2006 applies, 
a large number of marginalised communities live also outside urban areas. Therefore, 
it  is  necessary  to  extend  the  eligibility  of  expenditures  on  housing  interventions  in 
favour of these communities living in rural areas.  

Irrespective of whether these communities are located in urban or rural areas, due to 
the  extremely  poor  quality  of  their  housing  conditions,  expenditures  on  the 
replacement of the existing houses by newly constructed ones should also be eligible. 

In  line  with  Principle  No  2  of  the  Common  Basic  Principles  on  Roma  Inclusion 
reiterated by the Council in its Conclusions on Inclusion of the Roma of 8 June 2009, 
housing  interventions  focused  on  a  specific  group  should  not  exclude  other  people 
sharing similar socio-economic circumstances.  

In  line  with  Principle  No  1  of  those  Common  Basic  Principles,  in  order  to  limit  the 
risks of segregation, housing interventions for marginalised communities should take 
place  in  the  framework  of  an  integrated  approach,  which  includes  actions,  in 
particular, in the fields of education, health, social affairs, employment and security.  

Under the current regulatory framework, the criteria for selection of areas for housing 
interventions are subject to a process of simplification. With regard to the diversity of 
housing  situations  in  the  Member  States,  these  criteria  should  be  defined  in  a 
decentralised  way.  Therefore  the  Commission  should  not  be  obliged  to  adopt  such 
criteria.  

(8) 

Regulation (EC) No 1080/2006 should therefore be amended accordingly, 

HAVE ADOPTED THIS REGULATION: 

Article 1 

Article 7(2) of Regulation (EC) No 1080/2006 is replaced by the following:  

“2. 

Expenditure  on  housing,  except  for  energy  efficiency  and  the  use  of  renewable 
energy as set out in paragraph 1a, shall be eligible only for those Member States that 
acceded  to  the  European  Union  on  or  after  1  May  2004,  where  the  following 
conditions are met: 

(a) expenditure shall be programmed within one of the following frameworks: 

(i) 

the  framework  of  an  integrated  urban  development  approach  for  areas 
experiencing or threatened by physical deterioration and social exclusion;  

(ii) 

the framework of an integrated approach for marginalised communities.  

(b)  The allocation to housing expenditure shall be either a maximum of 3 % of the 
ERDF allocation to the operational programmes concerned or 2 % of the total 
ERDF allocation. 

For the purposes of point (a)(i) of the first subparagraph, expenditure shall be limited 
to one of the following interventions: 

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- 

- 

renovation of the common parts in existing multi-family housing, 

renovation and change of use of existing buildings owned by public authorities 
or  non-profit  operators  for  use  as  housing  designated  for  low-income 
households or people with special needs. 

For the purposes of point (a)(ii) of the first subparagraph, interventions may include 
the replacement of existing housing by newly constructed houses. 

The  Commission  may  adopt  the  list  of  criteria  needed  for  determining  the  areas 
referred  to  under  point  (a)(i)  of  the  first  subparagraph  and  the  list  of  eligible 
interventions  in  accordance  with  the  procedure  referred  to  in  Article  103(3)  of 
Regulation (EC) No 1083/2006.” 

Article 2 

This  regulation  shall  enter  into  force  on  the  twentieth  day  following  its  publication  in  the 
Official Journal of the European Union.  

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels,  

For the European Parliament 
The President 
[…] 

For the Council 
The President 
[…] 

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