Special Report No 5/2010 ‘Implementation of the Leader approach for rural development’
Date: 2010-11-18
Institutions: European Court of Auditors
Subjects: EU programme, cooperation policy, rural development

EUROPEAN 
COURT OF AUDITORS

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IMPLEMENTATION OF THE 
LEADER APPROACH FOR 
RURAL DEVELOPMENT

 
 
 
 
Special Report No 5 

 2010

IMPLEMENTATION OF THE
LEADER APPROACH FOR
RURAL DEVELOPMENT

(pursuant to Article 287(4), second subparagraph, TFEU)

EUROPEAN COURT OF AUDITORS

EUROPEAN COURT OF AUDITORS  
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1615 Luxembourg 
LUXEMBOURG

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Fax +352 4398-46410
E-mail: euraud@eca.europa.eu
Internet: http://www.eca.europa.eu

Special Report No 5 

 2010

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It can be accessed through the Europa server (http://europa.eu).

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Luxembourg: Publications Office of the European Union, 2010

ISBN 978-92-9207-883-6

doi:10.2865/27311

© European Union, 2010

Reproduction is authorised provided the source is acknowledged.

Printed in Luxembourg

Special Report No 5/2010 — Implementation of the Leader approach for rural development

CONTENTS

3

Paragraph

Glossary

I–X 

1–7 

EXECUTIVE sUMM ary

INTroDUCTIoN

8–11 

aUDIT sC oPE  aND  aPProa CH

12–114 

oBsEr VaTIoNs  

12–46 
12–46 

47–71 
47–71 

72–93 
72–93 

94–114 
94–114 

THE laGs’  IMPlEMENTaTIoN of THE lEaDEr fEaTUrEs To aCHIEVE  aDDED ValUE
 LAGS  HAVE IMPLEMENTED THE LEADER  APPROACH IN wAyS THAT LIMIT THE  
POTENTIAL FOR ADDED VALUE IN TERMS OF THE ‘LEADER  FEATURES’,  
ALTHOUGH THE COURT FOUND EXAMPLES OF GOOD PRACTICE

soUNDNEss of THE laGs’
 LAGS  DID NOT HAVE DUE REGARD TO THE NEED FOR EFFICIENCy  
OR FAIR AND TRANSPARENT PROCEDURES

 fINaNCIal MaNaGEMENT

THE CoMMIssIoN aND MEMBEr sTaTEs’
 THE  COMMISSION AND MEMBER  STATES  wERE  NOT SUFFICIENTLy DEMANDING AND SHARE SOME 
RESPONSIBILITy wITH  THE LAGS  FOR LIMITING THE POTENTIAL ADDED VALUE OF THE  
LEADER  APPROACH. THE y HAVE NOT TAkEN  SUFFICIENT ACTION TO LIMIT THE COSTS AND RISkS

 MaNaGEMENT of  THE lEaDEr ProGraMMEs

THE CoMMIssIoN aND MEMBEr sTaTEs’
 THE  COMMISSION AND MEMBER  STATES  CANNOT DEMONSTRATE THE ADDED VALUE  
ACHIEVED FROM IMPLEMENTING THE LEADER  APPROACH AND HAVE NOT yET EVALUATED  
THE ADDITIONAL COSTS AND RISkS  INVOLVED

 MoNITorING aND  EValUaTIoN

115–126 

CoNCl UsIoNs aND  rEC oMMEND aTIoNs

aNNEX — lIsT of ProjECTs rEVIEwED

rEPly of THE C oMMIssIoN

Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
Special Report No 5/2010 — Implementation of the Leader approach for rural development

GLOSSARy

5

added value: In the context of this audit, the benefits resulting from the Leader approach such 
as better identification of local needs and local solutions, more engagement on the part of local 
stakeholders and greater scope for innovation.

axis 4: Rural development in the 2007–13 programming period is implemented under four axes, 
which are coherent groups of measures. Axis 4 is the Leader approach.

Deadweight: A situation where a subsidised project would have been wholly or partly undertaken 
without the grant aid.

laG: Local action group, which is a local public–private partnership, responsible for proposing a 
local development strategy and selecting projects.

leader approach: A method to achieve the objectives of the EU’s rural development policy through 
bottom-up implementation rather than the traditional top-down approach. ‘Leader’ is a French 
acronym for ‘links between rural development actions’.

leader programme: A document prepared by a Member State and approved by the Commission 
to plan and implement the Leader approach. The first Leader programmes ran from 1991 to 1993 
and were followed by Leader II (1994–99). This audit concerns Leader+ (2000–06) and Leader Axis 4 
(2007–13), which was within the rural development programmes.

Measure: An aid scheme for implementing a policy. A measure defines the rules for the projects 
that can be financed.

Member state: In the context of this audit, the authorities in charge of the management of the 
Leader programmes. Member States designate a managing authority for this. Each region of Mem-
ber States such as Germany, Spain and Italy has a separate programme and a separate managing 
authority.

Programming period: Multiannual framework to plan and implement EU policies such as rural 
development; the current period is 2007–13.

rural development programme: A document prepared by a Member State and approved by the 
Commission to plan and implement the EU’s rural development policy.

sound financial management: Fair and transparent management of the EU budget in accord-
ance with the financial regulation and, in particular, the principles of economy, efficiency and 
effectiveness.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

I.
Le a d e r   i s   a   m e t h o d   to   a c h i e ve   t h e   o b j e c -
t i v e s   o f   t h e   E U ’s   r u r a l   d e v e l o p m e n t   p o l-
i c y   t h r o u g h   b o t t o m - u p   i m p l e m e n t a t i o n 
r a t h e r   t h a n   t h e   t r a d i t i o n a l   t o p - d o w n 
a p p r o a c h .   C o m p a r e d   w i t h   t r a d i t i o n a l 
methods of funding, the Leader approach 
i nvo l ve s   h i g h e r   co s t s   a n d   r i s k s,   ow i n g   to 
a n   a d d i t i o n a l   l a y e r   o f   i m p l e m e n t a t i o n , 
a n d   g i v i n g   t h e   c o n t ro l   o f   t h e   E U   b u d g e t 
t o   a   m u l t i t u d e   o f   l o c a l   p a r t n e r s h i p s 
(L AGs: l o cal  ac t ion  gro up s ).

II.
T h e   j u s t i f i c a t i o n   f o r   Le a d e r ’s   a d d i t i o n a l 
c o s t s   a n d   r i s k s   i s   t h e   a d d e d   v a l u e   t h a t 
s h o u l d   f l o w   f r o m   t h e   b o t t o m - u p   a n d 
p a r t n e r s h i p   a p p r o a c h   —   s u c h   a s   b e t t e r 
i d e n t i f i c a t i o n   o f   l o c a l   n e e d s   a n d   l o c a l 
s o l u t i o n s,   m o re   e n g a g e m e nt   o n   t h e   p a r t 
o f   l o c a l   s t a k e h o l d e r s   a n d   g r e a t e r   s c o p e 
for innovatio n.

III.
Th e   Co u r t   e x a m i n e d   w h e t h e r   t h e   Le a d e r 
a p p ro a c h   h a s   b e e n   i m p l e m e nte d   i n   ways 
t h a t   a d d   v a l u e ,   w h i l e   m i n i m i s i n g   t h e 
r isks to sound financial management. The 
Co u r t   a s s e s s e d   t h e   L AG s’  p e r fo r m a n ce   i n 
i m p l e m e nt i n g   t h e   2 0 0 0 – 0 6   Le a d e r +   p ro -
grammes, for which the final expenditure 
wa s   i n   2 0 0 9 .  Th e   Co u r t   a l s o   a s s e s s e d   t h e 
L A G s ’  A x i s   4   s t r a t e g i e s ,   w h i c h   s e t   o u t 
t h e i r   p l a n s   fo r   i m p l e m e n t i n g   t h e   Le a d e r 
approach  in th e 2007–13 p er io d.

6

EXECUTIVE 
SUMMARy

IV.
L AG s   i m p l e m e n t e d   t h e   Le a d e r   a p p ro a c h 
i n   w a y s   t h a t   l i m i t e d   t h e   p o t e n t i a l   f o r 
a d d e d   v a l u e   i n   t e r m s   o f   t h e   ‘ L e a d e r 
f e a t u r e s ’  a l t h o u g h   t h e   C o u r t   f o u n d 
s o m e   e x a m p l e s   o f   g o o d   p r a c t i c e .   T h e 
 b o t t o m - u p   a p p r o a c h   w a s   l i m i t e d   i n   t h e 
LAGs that gave the major it y of the grants 
t o   t h e i r   o w n   m e m b e r   o r g a n i s a t i o n s ;   t h e 
p o t e n t i a l   a d d e d   v a l u e   o f   a   p a r t n e r s h i p 
was not achieved in LAGs where the deci -
s i o n - m a k i n g   wa s   d o m i n ate d   by   t h e   l o c a l 
a u t h o r i t i e s ;   fe w   L AG s   co u l d   d e m o n s t rate 
innovation or interac tion bet ween differ -
ent sec tors in their strategies or projec ts. 
L A G s   d i d   n o t   f o c u s   o n   a c h i e v i n g   t h e 
objec tives  of  t heir  loc al strategi es.

V.
T h e   C o u r t   a l s o   fo u n d   w e a k n e s s e s   i n   t h e 
s o u n d n e s s   o f   t h e   f i n a n c i a l   m a n a g e m e n t 
b y   t h e   L A G s .   I n   p a r t i c u l a r,   L A G s   g a v e 
g r a n t s   t o   p r o j e c t s   w i t h o u t   r e g a r d   t o 
e f f i c i e n c y.   P r o c e d u r e s   w e r e   n o t   a l w a y s 
transparent and did not sufficiently dem-
o n s t rate   t h at   t h e   L AG s   to o k   d e c i s i o n s   o n 
a n   o b j e c t i ve   b a s i s,   f re e   f ro m   co n f l i c t s   o f 
i n t e r e s t .   T h e s e   w e a k n e s s e s   e c h o   t h o s e 
o b s e r v e d   b y   t h e   C o u r t   i n   t h e   A n n u a l 
R epor t  of 20 00 .

VI.
The Commission and M ember States have 
n o t   b e e n   s u f f i c i e n t l y   d e m a n d i n g   a n d 
s h a re   s o m e   re s p o n s i b i l i t y   w i t h   t h e   L AG s 
f o r   l i m i t i n g   t h e   p o t e n t i a l   a d d e d   v a l u e 
o f   t h e   L e a d e r   a p p r o a c h .   T h e y   h a v e   n o t 
t a k e n   s u f f i c i e n t   a c t i o n   to   l i m i t   t h e   co s t s 
a n d   r i s k s .  Te n   y e a r s   o n   f r o m   t h e   C o u r t ’s 
p re v i o u s   a u d i t   o f   Le a d e r,   t h e   s a m e   we a k-
n esses  persist.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

7

EXECUTIVE 
SUMMARy

X.
M o n i t o r i n g   s h o u l d   b e   r e f o c u s e d   o n   t h e 
added value of the Leader approach, effi-
c i e n c y   a n d   e f f e c t i v e n e s s ,   a n d   b e   c o m-
p l e m e nte d   by   d at a   f ro m   s u p e r v i s o r y   a n d 
c o n t r o l   s y s t e m s   s u c h   t h a t   t h e   C o m m i s-
s i o n   h a s   s u f f i c i e n t ,   re l i a b l e   a n d   re l e v a n t 
d a t a   t o   a c c o u n t   f o r   t h e   a d d e d   v a l u e 
a n d   s o u n d   f i n a n c i a l   m a n a g e m e n t   o f   t h e 
Lea der program me s.

V II.
T h e   C o m m i s s i o n   h a s   n o t   y e t   d e m o n-
s t r a t e d   t h e   e f f e c t i v e n e s s   o r   e f f i c i e n c y 
o f   t h e   e x p e n d i t u r e ,   t h e   a d d e d   v a l u e 
a c h i e v e d   t h r o u g h   f o l l o w i n g   t h e   L e a d e r 
approach, the ex tent to which the k nown 
r i s k s   h a v e   m a t e r i a l i s e d   o r   t h e   r e a l   c o s t s 
of imp l ementat ion .

V III.
I n view  o f t he per sistent weak ne ss es, th e 
Co u r t   re c o m m e n d s   t h a t   t h e   Co m m i s s i o n 
a n d   M e m b e r   S t a t e s   c l a r i f y   a n d   e n f o r c e 
re q u i re m e nt s   to   re d u ce   t h e   r i s k   o f   d e a d-
w e i g h t ,   e n s u r e   o b j e c t i v e   a n d   p r o p e r l y 
d o c u m e n t e d   p r o j e c t   s e l e c t i o n   p r o c e -
d u re s,   a n d   t h at   t h e   p a r t n e r s h i p   p r i n c i p l e 
o p e r a t e s   i n   p r a c t i c e.   R o b u s t   p ro c e d u re s 
t o   a v o i d   a l l   r i s k   o f   c o n f l i c t s   o f   i n t e r e s t 
a re   n e e d e d   t o   c o m p l y   w i t h   t h e   f i n a n c i a l 
r e g u l a t i o n .   T h i s   r e q u i r e s   d e c l a r a t i o n s 
o f   i n t e r e s t ,   n o n - p a r t i c i p a t i o n   i n   p r o j e c t 
a s s e s s m e nt   a n d   s e l e c t i o n ,   a n d   re fe r ra l   o f 
c a s e s   o f   p o t e n t i a l   c o n f l i c t   o f   i n t e re s t   t o 
the  managing  aut ho r it y.

IX .
For the remainder of the 2007–13 per iod, 
the Commission should ensure that M em -
b e r   S t a te s   re q u i re   t h e   L AG s   to   s e t   m e a s-
u r a b l e   o b j e c t i v e s,   s p e c i f i c   t o   t h e i r   l o c a l 
a re a ,   t h at   c a n   b e   a c h i e ve d   by   t h e   Le a d e r 
p r o g r a m m e .   T h e   M e m b e r   S t a t e s   s h o u l d 
r e q u i r e   L A G s   t o   a c c o u n t   f o r   a c h i e v i n g 
their local strategy objec tives, for achiev-
i n g   a d d e d   v a l u e   t h r o u g h   t h e   L e a d e r 
a p p r o a c h ,   a n d   f o r   t h e   e f f i c i e n c y   o f   t h e 
g r a n t   e x p e n d i t u r e   a n d   t h e   o p e r a t i n g 
costs.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

INTRODUCTION

8

1. 

 Lead er  is  the  EU’s  ‘ b o ttom- u p’  m et h od  for   im plem ent in g   r ural 
deve l op ment p ol ic y. I t is  charac te r i se d by se ve n feat ure s (s e e 
Fi g u r e   1) .   Fi n a n c i a l   s u p p o r t   i s   g i v e n   t o  ‘ l o c a l   a c t i o n   g r o u p s’ 
( co m m o n l y   k n ow n   a s   L AG s ) ,   to   i m p l e m e nt   l o c a l   d e ve l o p m e nt 
strategies, pr incipally through giving grants to local projec ts 1 
( s e e   A n n e x  fo r   e x a m p l e s   o f   t h e   p r o j e c t s   f i n a n c e d ) .   L AG s   a r e 
par tnerships of public and private (or non-profit) sec tor mem-
bers  of  smal l rural commu niti es 2.

1  The grants are co-financed by 
the EU and by the public authorities 

of the Member State concerned. 

In most cases, the grant is only for 

a proportion of the total project 

costs: the beneficiary also has to 

contribute. The LAGs’ running costs 

are also co-financed by the EU and 

the national or regional authorities.

2  Rural communities with up to 
150 000 inhabitants.

f I G UrE   1

T H E   sE V E N   K Ey   fEa T UrEs   o f  T H E   lEaD Er   aP Pr o a C H

Bottom-up
elaboration and
implementation
of strategies

Area-based
local
development
strategies

Local 
public–private
partnerships: 
LAGs

The
Leader
approach

Networking

Integrated and
multisectoral
actions

Cooperation

Innovation

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
9

2. 

3. 

4. 

 EU  re g ulat ions  set  th e  p o l ic y  obj ec ti ves   an d  le g al  f ra mewor k . 
Member States determine national or regional programmes for 
i m p l e m e n t i n g   t h e   L e a d e r   a p p r o a c h ,   w h i c h   a r e   a p p r o v e d   b y 
t h e   Co m m i s s i o n .  Th e   p o t e n t i a l   L AG s   d e ve l o p   l o c a l   s t r a te g i e s 
according   to  th e  n atio nal   o r  region al   req ui re me nt s  a n d  apply 
t o   t h o s e   a u t h o r i t i e s   fo r   f u n d i n g.   M e m b e r   S t a t e s   a r e   r e s p o n -
s i b l e   fo r   s e l e c t i n g   t h e   L AG s ,   p a y i n g   t h e   E U   a i d   a n d   n a t i o n a l 
c o - f i n a n c i n g ;   a n d   f o r   t h e   m o n i t o r i n g   a n d   c o n t r o l   o f   i m p l e -
m e nt at i o n .   L AG s   a re   re s p o n s i b l e   fo r   s e l e c t i n g   t h e   p ro j e c t s   to 
b e   f i n a n ce d.   I n   s o m e   M e m b e r   S t ate s,   L AG s   s e l e c t   p ro j e c t s   u p 
t o   a n   a n n u a l   f i n a n c i a l   a l l o c a t i o n ,   w i t h   t h e   p r o c e s s i n g   o f   t h e 
grant applications and payment of the grants being per formed 
by   t h e   n at i o n a l   o r   re gi o n a l   a u t h o r i t i e s.   O t h e r   M e m b e r   S t a te s 
give  LAG s resp o ns ib ilit y fo r the  e nt ire  pro ce ss,  wi th  an n ual  or 
mul tian nu al  bud get s fro m w hic h  to  pay  t he   grants.

3  New Member States could 
implement a similar measure in 

their rural development operational 

programmes from 2004–06.

4  Council Regulation (EC) 
No 1698/2005 of 20 September 2005 

on support for rural development 

by the European Agricultural Fund 

for Rural Development (EAFRD) 

(OJ L 277, 21.10.2005, p. 1).

 T h e   f i r s t   Le a d e r   p e r i o d   s t a r t e d   i n   1 9 9 1   a s   a  ‘C o m m u n i t y   i n i-
t i a t i ve’  a n d   w a s   fo l l owe d   by   Le a d e r   I I   ( 1 9 9 4 – 9 9 )   a n d   Le a d e r + 
( 2 0 0 0 – 0 6 ) 3.   A l t h o u g h   t h e   Le a d e r +   p e r i o d   n o m i n a l l y   e n d e d   i n 
2006, projec t implementation and expenditure could continue 
until mid-2009. There were 893 Leader+ LAGs in EU-15 and 281 
i n   t h e   n e w   M e m b e r   S t a t e s .   T h e   f i n a l   E U   c o n t r i b u t i o n   t o   t h e 
Leade r+ p ro gramme w il l  b e aro un d  2 , 1  billi on  e uro.

 From  2007 o nwards, Leader  has bee n integrated  into t he  r ura l 
development regulation 4 as an alternative approach to achieve 
the objec tives of the three ‘mainstream’ axes of the polic y (see 
B ox  1).

B oX   1

TH E   f oUr   a X Es   o f   T H E   20 07 – 1 3  r Ur a l   D E V EloP M E N T   Po lI C y

axis 1:  measures with the objective of improving the competitiveness of agriculture and forestry 

by supporting restructuring, development and innovation.

axis 2:  measures with the objective of improving the environment and the countryside by support-

ing land management.

axis 3:  measures with the objective of improving the quality of life in rural areas and encouraging 

diversification of economic activity.

axis 4:  use of the Leader approach to achieve the objectives of Axes 1–3.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
 
5. 

6. 

 Th e   Co m m i s s i o n   a p p rove d   m o s t   o f   t h e   n a t i o n a l   a n d   re g i o n a l 
2 0 0 7 – 1 3   r u r a l   d e v e l o p m e n t   p r o g r a m m e s   i n   2 0 0 7   a n d   e a r l y 
2 0 0 8 .   B y   t h e   e n d   o f   2 0 0 9 ,   M e m b e r   S t a t e s   h a d   s e l e c t e d   o v e r 
2  0 0 0   A x i s   4   L A G s .   T h e   p l a n n e d   E U   s p e n d i n g   o n   t h e   L e a d e r 
axis during this programming period is around 5,5 billion euro 
(see  Figure 2) 5, with national public co -financing an additional 
3,4  bil l ion  e uro. 

 T h e   a s s u m p t i o n   b e h i n d   t h e   Le a d e r   a p p r o a c h   i s   t h a t   t h e r e   i s 
a n   a d d e d   v a l u e   c o m p a r e d   w i t h   t r a d i t i o n a l   t o p - d o w n   i m p l e -
m e n t a t i o n 6.   B o t t o m - u p   a p p ro a c h e s   a n d   i n t e r a c t i o n   b e t we e n 
different sec tors at local level should mobilise local potential. 
Loc al gro u ps s ho u l d b e b est  pla ced  to i d enti f y integrate d an d 
i n n ovat i ve   l o c a l   s o l u t i o n s   to   l o c a l   p ro b l e m s   a n d   c a n   b e   m o re 
responsive. Par ticipation in local decision-mak ing should gen-
erate  enthus ias m and increas ed commi tm e nt  and c a n  th e re by 
r e s u l t   i n   b e t t e r,   m o r e   s u s t a i n a b l e ,   l o c a l   r u r a l   d e v e l o p m e n t 7. 
T h e   c o m m u n i t y   i n v o l v e m e n t   a c h i e v e d   t h r o u g h   t h e   b o t t o m -
u p   a p p r o a c h   c a n   a l s o   l e a d   t o   l e s s   t a n g i b l e   i m p a c t s ,   s u c h   a s 
‘c a p a c i t y - b u i l d i n g ’  a n d  ‘e m p o w e r i n g   t h e   l o c a l   p o p u l a t i o n’ 8 
(see Fig u r e 3).

10

5  Axis 4 (Leader) represents from 
5 % to 11 % of planned expenditure 

of the rural development 

programmes in the EU-15 Member 

States, and a minimum of 2,5 % 

in the new Member States’ 

programmes.

6 

In ‘top-down’ methods, national 

or regional authorities define 

expenditure measures and project 

selection criteria and their staff 

assess project proposals and decide 

on the grants to award. Certain 

tasks of the national or regional aid 

schemes may be performed by the 

staff of local offices.

7 

‘The main concept behind 

the Leader approach is that … 

development strategies are more 

effective and efficient if decided and 

implemented at local level by local 

actors.’ European Commission fact 

sheet ‘The Leader approach’.

8 

‘The capacity-building and 

empowerment of the local 

population achieved under Leader 

should be seen as generating 

additional value added for the rural 

community.’ Commission reply to the 

2000 Annual Report.

f I G UrE   2

E U   f U N Ds   Pr oGr aM M E D   f o r   l EaD Er   aX Is   4   ( 20 0 7 – 1 3 ) 
By   ME M B Er   s TaT E

)
o
r
u
e
n
o

i
l
l
i

m

(

900
800
700
600
500
400
300
200
100
0

Estonia
Belgium
Bulgaria
Austria
Denmark
Czech Republic
Cyprus

Finland

Greece
Germany
Ireland
Hungary
France

United Kingdom
Slovenia
Spain
Slovakia
Romania
Portugal
Poland
Sweden
Malta
Latvia
Lithuania
Italy
Netherlands
Luxembourg

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
 
11

7. 

 LAGs represent an additional implementation layer, which en-
t a i l s   c e r t a i n   c o s t s .   D e l e g a t i n g   d e c i s i o n - m a k i n g   t o   t h e   l o c a l 
par tn ership s al s o car r ies  r isks to t h e s oun d f inan c ial m anag e -
m e n t   o f   t h e   E U   f u n d s   i n   t e r m s   o f   f a i r n e s s ,   t r a n s p a r e n c y   a n d 
a c c o u n t a b i l i t y,   a s   w e l l   a s   e c o n o my,   e f f i c i e n c y   a n d   e f fe c t i ve -
n e s s.  wh e n   t h e   Co u r t   l a s t   a u d i te d   t h e   Le a d e r   p ro gra m m e,   fo r 
the Annual Repor t 2000 9, some serious weak nesses in financial 
m a n a g e m e n t   b y   t h e   L A G s   w e r e   i d e n t i f i e d :   L A G s   b a c k d a t i n g 
grants resulting in a risk of deadweight; lack of transparenc y in 
project selection; potential conflicts of interest; high operating 
cost s  an d  l eng thy   p ro cedures. Th e   Co mm is s ion   re pli e d  th at   i t 
w a s   aw a re   o f   t h e   r i s k s.   I t s   p r i n c i p a l   re s p o n s e   w a s   t o   e n c o u r -
a g e   g o o d   p r a c t i ce   a n d   s o u n d   f i n a n c i a l   m a n a g e m e n t   t h ro u g h 
guida nce and t he exchang e of in for mat io n 10.

9  Annual Report concerning the 
financial year 2000, paragraphs 3.96 

to 3.112 (OJ C 359, 15.12.2001).

10  This point is developed further in 
paragraphs 72 to 77 and 104 to 106.

f I G UrE   3

r o lE   o f   l aG s   I N  T H E   I M PlE M E N T aT IoN   o f  T H E   l EaD Er   aP Pr o a C H

What should LAGs do?

How can LAGs add value?

What can LAGs achieve?

Involve different socioeconomic
sectors of the local community.

Develop integrated local stategies.

Select and award grants to 
projects to implement the 
local strategies.

Share information and experience
through reporting, networking 
and cooperation.

Better strategies

better assessment of local needs;

better identification of local
potential and integrated,
innovative solutions.

Better implementation

better project selection;

closer monitoring and better
responsiveness;

increased commitment 
and enthusiasm.

Achievement of specific outputs
and results of activities and projects.

Impact: achieving the EU’s rural
development objectives as translated
by the local strategy.

Indirect impact: other local activities
being done better (outside the
Leader programme).

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
AUDIT SCOPE AND APPROACH

12

8. 

 A s   i n d i c a t e d   a b o v e ,   t h e   L e a d e r   a p p r o a c h   e n t a i l s   a d d i t i o n a l 
c o s t s   a n d   r i s k s   i n   r e l a t i o n   t o   m o r e   t r a d i t i o n a l ,   c e n t r a l i s e d 
met ho ds o f impl ementing  th e rural de ve lopm ent poli c y but i t 
a l s o   h a s   t h e   p o te n t i a l   to   d e l i ve r   a n   a d d e d   v a l u e   t h ro u g h   t h e 
seve n  Lead er  feat ures. Th is   l eads   to  t h e  audi t  que st ion   s et   by 
the Cour t: Has Leader been implemented in ways that add value, 
while  m i ni mi sin g th e  risk s to sou n d f ina ncial  m an age me nt ? 

11  The LAGs in Poland implemented 
transitional Leader+ programmes, 

which were not comparable with the 

other Member States.

9. 

 The Co ur t b ased th e audit  o n :

o  a u d i t   q u e s t i o n n a i r e s   c o m p l e t e d   b y   a   r a n d o m   s a m p l e   o f 

2 02 LAGs in 2 3 M emb er St ates ;

o  a  revie w of  d oc um ent ation for  2 7  of  th e se  L AGs ;

o  on the spot audit and case -study examples from 13 of these 
L AGs  and ove r 60  p ro jec t s t hat we re  t y pi cal of th e  ran g e of 
pro jec ts fu nde d by  the LAGs  con ce r n ed  ( s ee  li s t of proje c ts 
in  A nnex);

o  a u d i t   o f   t h e   m a n a g i n g   a u t h o r i t i e s   o f   t h e   1 1   L e a d e r   p r o -
g r a m m e s   c o n c e r n e d ,   w h i c h   t o g e t h e r   r e p r e s e n t   o v e r   4 0   % 
o f t he E U fu nds  p ro grammed fo r  t h e  2 0 0 7 – 13  per i od;

o  au dit  of  t he Co mmissio n’s ac t ivi ti e s i n  re lati on  to  Le ad er.

A t   t h e   t i m e   o f   t h e   a u d i t   f i e l d w o r k   i n   t h e   f i r s t   h a l f   o f   2 0 0 9 , 
t h e   L A G s   h a d   r e c e n t l y   c o m p l e t e d   i m p l e m e n t a t i o n   o f   t h e i r 
2000–06 Leader+ local development strategies 11 and had been 
s e l e c t e d   b y   t h e   M e m b e r   S t a t e s   o n   t h e   b a s i s   o f   t h e i r   A x i s   4 
s t r a t e g i e s ,   w h i c h   s e t   o u t   t h e i r   p l a n s   f o r   i m p l e m e n t i n g   t h e  
L e a d e r   a p p r o a c h   i n   t h e   2 0 0 7 – 1 3   p e r i o d .   E x c e p t   i n   G e r m a n y 
and Aragón (Spain), the LAGs had not yet star ted to implement 
th eir A xis 4 strategies.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
13

10.  

 The Cour t developed ‘good practice’ criteria from the legislation 
and from Commission documents and publications 12. The Cour t 
examined the selected LAGs’ per formance against these criteria 
dur ing   t he   Lea der +  p er io d  and  i n  ter m s  of   th e i r   Ax is  4  st rate -
gie s.  The a udit  was  con duc ted on t he  pre mi s e s of  th e L AG s to 
a l l ow   a   re v i e w   o f   a l l   re l e va nt   d o c u m e nt at i o n   a n d   d i s c u s s i o n s 
w i t h   L AG   s t a f f   a n d   m e m b e r s   o n   t h e   co nte x t   a n d   s t rate g y   fo l-
l o w e d .   T h e   s e l e c t e d   p r o j e c t s   w e r e   a l s o   c h e c k e d   o n   t h e   s p o t 
and  th e p rojec t   p romo ters inter v ie we d.

12  In particular, the Commission 
notice to the Member States 

of 14 April 2000 laying down 

guidelines for the Community 

initiative for rural development 

(Leader+) (OJ C 139, 18.5.2000, p. 5) 

and Articles 61–65 of Regulation 

(EC) No 1698/2005.

where weak nesses or good prac tices were identified, the relat-
ed national or regional monitoring and evaluation information, 
p ro c e d u r e s   a n d   c o n t r o l   s y s t e m s   w e r e   a s s e s s e d   t o   d e t e r m i n e 
w h e t h e r   t h e   p r a c t i c e s   w e r e   t y p i c a l .   T h e   C o u r t   a s s e s s e d   t h e 
Com miss io n  and  M emb er  States’  pe r for ma nce   i n  th e   man ag e -
ment, monitoring, evaluation and super vision of Leader on the 
basis   of   t he   n atio nal   and   region al  program m es   an d  ope rati ng 
rules as well as inspec tion results, implementation repor ts and 
eval uat io ns.  Th e  audit  incl ud e d  th e   Com mi ss i on’s  as s es sm ent 
of  Axis   4  o f  t he  11  ru ral   devel opm ent  program m es   con ce r n ed 
and  th e M e mbe r States’ sel ec tion  of  Axi s  4  LAG s.

11.  

 The obser vations are struc tured according to the main respon-
sibi lit ies  as fol l ows :

o 

o 

o 

o 

t he LAG s’ impl ementat ion  of th e  Le ad er  fe at ure s;

so u ndnes s of  t he LAGs’ f inan cial  m an ag e ment;

the Commission and Member States’ management of Leader 
p ro gra mmes ;

the Commission and Member States’ monitoring and evalu-
at io n.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
14

TaBlE   1

s ElE C T E D   l aG s   aN D   B U D G E T s   f o r   I M PlE M E N T I N G  T H E Ir 
aX Is  4  sTr a T E G I Es

laG reference 

Member state (region)

DE-By

Germany (Bavaria)2

DE-MV

Germany (Mecklenburg-Vorpommern)2

IE

El

Es-a

Ireland

Greece

Spain (Aragón)

Es-CM

Spain (Castilla-La Mancha)

fr (Pl)

France (Pays de la Loire)

fr (lr)

France (Languedoc-Roussillon)

IT-Tos

HU

Italy (Tuscany)

Hungary

Pl (wP)

Poland (Pomorskie)

Pl (wŚ)

Poland (Świętokrzyskie)

PT

Portugal

( mil lion  e uro)

axis 4 budget 
2007–131

2,6

5,4

14,6

6,5

7,1

3,9

1,5

3,2

7,6

5,9

4,3

2,1

6,0

1 
2 

Including national or regional co-financing.

Indicative allocations.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

OBSERVATIONS

15

 TH E   l aG s ’  I M PlE M E N T aT IoN   o f  T H E   l EaD Er 
fEa T UrEs   To   aC H I E V E   aD D E D  Va lU E

l aG s   Ha V E   I M PlE M E N T E D  T H E   l EaD Er   aP Pr o a C H 
I N  ways  T Ha T   lI M I T  T H E   Po T E N T Ia l   f o r   aD D E D  
Va lU E   I N  T ErMs   o f   T H E  ‘ l EaD Er   fEa T UrEs ’, 
a lT HoU G H  T H E   CoUrT   f oU N D   E X aM PlEs   o f 
Go oD   Pr a C T I C E

B o t t o m- u p  a p p r o a c h

12.  

 T h e   b o t t o m - u p   a p p ro a c h   a i m s   t o   e n c o u r a g e   p a r t i c i p a t i o n   i n 
the local rural development by involving the local communit y, 
e c o n o m i c   a n d   s o c i a l   i n t e r e s t   g r o u p s   a n d   r e p r e s e n t a t i v e s   o f 
p u b l i c   a n d   p r i v a t e   i n s t i t u t i o n s .  T h e   l o c a l   c o m m u n i t y   s h o u l d 
be involved in identifying the most relevant local strategy and 
i m p l e m e nt i n g   t h e   a c t i v i t i e s   ( p ro j e c t s )   n e e d e d   to   a c h i e ve   t h e 
loca l  strateg y o b jec t ives.

A l l   L AG s   o b t a i n e d   a   d e g r e e   o f   l o c a l   c o m m u n i t y   i nv o l v e m e n t 
b u t   s o m e   L AG s   g ave   m o s t   o f   t h e   Le a d e r +   gra nt s   to   t h e i r   ow n 
mem b ers’ o rg anis at ions

13.  

 L A G s   i n f o r m e d   t h e   l o c a l   c o m m u n i t y   o n   t h e   p o s s i b i l i t i e s   f o r 
p r o j e c t   g r a n t s   b y   v a r i o u s   m e a n s :   a t   p u b l i c   m e e t i n g s   a n d 
e ve n t s,   by   l e a f l e t s   a n d   p u b l i c a t i o n s,   t h e   L AG s’  I n te r n e t   s i t e s, 
and through the LAGs’ members. I n this way, the LAGs not only 
resp o nded  to   exis ting  dem an d  for   grants   but  als o  pote nti ally 
e n c o u r a g e d   o t h e r   l o c a l   a c t o r s   t o   c o n s i d e r   n e w   i n v e s t m e n t s 
or o t her pro jec ts.  The LAG in  Tus c any  (I t aly ) , for  ex ample,  h ad 
a n   i n fo r m a t i o n   p o i n t   i n   t h e   l o c a l   c h a m b e r   o f   c o m m e rc e.  T h e 
Le a d e r   p ro gra m m e s   we re   a l s o   p u b l i c i s e d   t h ro u g h   l o c a l   p re s s 
cove r a g e   a n d   by   p l a q u e s   d i s p l aye d   a t   t h e   s i te   o f   p ro j e c t s.   I n 
Hungar y, the LAG heightened the awareness of Leader by signs 
at  th e entrance to each vill age.

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16

13  In Greece, the national rules 
prevented such assistance from the 

moment that a formal call for project 

proposals was published. The 

project promoters interviewed each 

paid consultants between 1 200 and 

3 500 euro to prepare their grant 

applications.

Picture 1: Hungary — Signs announcing that the village 
 participated in the Leader programme

14.  

15.  

 All LAGs also had local offices, where staff assisted projec t pro-
m o te r s   i n   p re p a r i n g   t h e i r   gra nt   a p p l i c at i o n s 1 3.  Th i s  ‘ f re e   co n -
sultanc y ser vice’ was an impor tant fac tor in encouraging grant 
a p p l i c at i o n s   a s   i n ex p e r i e n ce d   p ro m o te r s   o f   s m a l l   p ro j e c t s,   i n 
par ticular, may other wise have been dissuaded by the lengthy 
and  co mpl ex pro cedu res (s ee pa ragraph  7 0 ) .

 w h i l e   m a ny   p r o j e c t s   w e r e   s t r a i g h t fo r w a r d   g r a n t s   fo r   i nv e s t -
m e n t s ,   s t u d i e s   o r   e v e n t s ,   s o m e   L A G s   w e r e   a l s o   p r o a c t i v e   i n 
wor k ing wit h lo cal  ac tor s to disc us s an d  d eve lop m ore  s trate -
gic projec ts from the first ideas. I n M eck lenburg-Vor pommer n 
(G er m any),  fo r  examp l e,   the  LAG  e st abli s he d  wor k i n g  groups, 
c a l l e d  ‘i n n o v a t i o n   t e a m s’  t o   g u i d e   a n d   s u p p o r t   p ro m o t e r s   o f 
t h e   m o re   co m p l ex   p ro j e c t s.  Th e   L AG   i n   I re l a n d   e m p l oye d  ‘d e -
ve l o p m e nt   o f f i ce r s’,   w h o s e   j o b   wa s   to   a c t i ve l y   s e a rc h   fo r   a n d 
d e v e l o p   p r o j e c t   i d e a s   t h a t   w o u l d   h e l p   a c h i e v e   t h e   s t r a t e g y 
obj ec t ives (see  B ox  2).

B oX   2

r o lE   o f   Pr o jE C T   D E V EloP M E N T   o f fI C Er s   I N  T H E   l aG   I N   I rEl aN D

Development officers were responsible for analysing, identifying and developing, stimulating and pro-
moting activities and initiatives. The ‘food sector’ officer, for example, was responsible for developing 
and marketing the regional brand for local food products; development of alternative agriculture ini-
tiatives, etc. The officer maintained an active blog; organised and attended meetings and events; and 
encouraged and assisted the development of projects by food-sector professionals.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
17

16.  

 Al l   o f   t h e   a u d i te d   L AG s   awa rd e d   gra nt s   to   p ro j e c t s   p ro m o te d 
by   t h e i r   ow n   m e m b e r   o rg a n i s at i o n s.  Th e   Le a d e r +   p ro gra m m e 
i m p l e m e n t e d   b y   t h e   L AG   i n   B a v a r i a   ( G e r m a n y )   i n v o l v e d   j u s t 
12 different projec t promoters, of which six were direc tly con-
nec ted with the LAG. In six of the 11 Leader+ LAGs, such grants 
represented from 50 % to over 90 % of the total (see Figure  4). 
T h i s   r e d u c e d   t h e   g r a n t s   a v a i l a b l e   f o r   t h e   w i d e r   c o m m u n i t y, 
limiting their possibilities to become involved through running 
pro jec t s.

fI G UrE   4

G r aN T s   awa rD E D  To   l aG s   aN D  T H E Ir   M E M B Er   o r GaN Is a T IoNs 1

100 %

75  %

66  %

47  %

54  %

56  %

48  %

90 %

80 %

70 %

60 %

50 %

40 %

30 %

20 %

10 %

0 %

DE-BY

ES-A

ES-CM

FR (PL)

FR (LR)

PT

% of public expenditure

% of projects

1  Including organisations in which LAG members had a direct interest. The data for Aragón exclude grants to individual small businesses 
where the promoter was a member of the LAG. The LAG’s membership policy encourages community involvement, so does not limit 

possibilities for participation (see paragraph 19).

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
18

17.  

 A l l   L A G s   i n v o l v e d   t h e   l o c a l   c o m m u n i t y   i n   d e v e l o p i n g   t h e 
A x i s  4   s t r a t e g i e s ,   t o   v a r y i n g   d e g r e e s .   T h e   L A G s   i n   F r a n c e 
 (Languedoc -R oussillon) and Bavar ia organised thematic wor k -
s h o p s   i n   a   p a r t i c i p a t o r y   p r o c e s s   t o   i d e n t i f y   t h e   l o c a l   a r e a’s 
stren gt hs,   we ak ness es,   o p p or tuni ti e s   a n d  th reats   ( SwOT )   an d 
t o   d e b a t e   t h e   s t r a t e g y.   A l l   L AG s   h e l d   p u b l i c   m e e t i n g s   t o   e x-
plain the Leader programme and receive ideas for projec ts but 
i n  Tu s c a ny,   I re l a n d,   Po r t u g a l   a n d   C a s t i l l a - L a   M a n c h a   ( S p a i n ) , 
it  was  no t  evid ent   how,   o r  if,   t he   con s ult at ion   h ad  i nf luen ce d 
the LAGs’ SwOT analysis or the deter mination of local strategy 
objec tives. The consultation ser ved pr imar ily to stimulate and 
a s s e s s   t h e   l e ve l   o f   d e m a n d   fo r   t h e   d i f fe re n t   m e a s u re s   a n d   to 
colle c t p ro jec t  p rop os al s.

14  Article 62 of Regulation (EC) No 
1698/2005: LAGs should represent 

partners from the various locally 

based socioeconomic sectors in the 

territory concerned. At the decision-

making level the economic and 

social partners, as well as repre-

sentatives of the civil society, such as 

farmers, rural women, young people 

and their associations, must make 

up at least 50 % of the local partner-

ship.

L o c a L  p u B L i c – p r i v a t e  p a r t n e r s h i p s

18.  

 One of the key features of the Leader approach is that decisions 
sho ul d  b e made not  by p ubl ic aut hor i ti e s but by  a w ide r  loc al 
par t ners hip,  w here th e l oc al  gove r nm ent i s i n clude d but  doe s 
not have a majo r it y vote 14.  I nvolvement of th e comm unit y  c an 
be enhanced by allowing all interested local par ties to par tici-
p a t e   i n   t h e   L AG   a n d   b y   e n s u r i n g   t h a t   a l l   t h e   k e y   l o c a l   a c t o r s 
are rep res ented.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

 
 
19

L A G s   d i d   n o t   a l w a y s   a c h i e v e   a n   e f f e c t i v e   p u b l i c – p r i v a t e 
 par t ne rs hip

19.  

 T h e   L AG s   i n   Po l a n d   a n d   A r a g ó n   we re   a s s o c i a t i o n s   w i t h   o p e n 
mem be rship po l icies  w h ereby  a ny  intere s te d l oc al re si de nt or 
organisation was encouraged to join. The LAG in Aragón, for ex-
ample, had around 500 members (see Table 2). By contrast, the 
L AG   i n  G re e ce   h ad   a   s m a l l e r,   i nv i te d  me m b e r s h i p,   p o te nt i al l y 
e xc l u d i n g   o t h e r   l o c a l   o rg a n i s a t i o n s   a n d   re s i d e n t s   t h a t   c o u l d 
have  b roug ht  addit ion al inp ut  to  t he  par t ne r sh i p (s ee B ox   3).

TaBlE   2

M E M B Er sH I P   o f  T H E   lEaD Er +   l aG s

DE-BY 

DE-MV 

IE

EL

ES-A

ES-CM

FR (PL) 

FR (LR) 

IT-TOS 

HU

PT

Number of LAG members

20

13

16

15

484

46

78

49

15

41

22

of which, members of the decision-making committee

11

13

16

7

16

20

20

22

13

21

7

B oX   3

CoM Po sI T IoN   o f  T H E   l aG   I N   GrE E C E

The Leader+ LAG had an invited membership with a small number of local actors represented and a struc-
ture that may allow the public sector to influence the decision-making. It was organised as a company with 
15 shareholders and the local municipalities held 97 % of the share capital. The Board, which consisted of 
nine representatives of the main municipalities (in most cases the mayors), selected a committee to decide 
on project applications. This committee consisted of representatives of three of the municipalities and four 
other organisations: the chamber of commerce, an association of organic farmers, a women’s association 
and a research organisation.

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20.  

21.  

22.  

 M embership of all the audited LAGs included different sec tors 
a n d   g r o u p s ,   c o m m o n l y   r e p r e s e n t a t i v e s   o f   t h e   l o c a l   a u t h o r i -
ties,  to ur is m a nd far ming  s ec tor s  an d  sm all bu sin e s s.  All L AGs 
included female members in the decision-mak ing committees. 
young people are a key target group of the EU’s rural develop -
ment polic y and their involvement in the decision-making proc -
ess can ensure that their needs and oppor tunities are properly 
c o n s i d e re d   a n d   t h a t   a p p ro p r i a t e   s o l u t i o n s   a re   i m p l e m e n t e d. 
O n l y   s e v e n   o f   t h e   1 3   A x i s   4   L A G s   h a d   y o u t h   r e p r e s e n t a t i o n 
i n   t h e i r   m e m b e r s h i p   ( a n d   o n   t h e   d e c i s i o n - m a k i n g   co m m i t te e 
only in the LAGs in Spain and Hungar y). O ther LAGs stated that 
t h e re   we re   n o   yo u t h   o r g a n i s a t i o n s   i n   t h e i r   a re a ,   b u t   h a d   n o t 
ta ken  any  s pe cif ic ac tio n to  involve  you ng  pe opl e  in  t he  L AG.

 I n   a l l   t h e   L AG s,   t h e   d e c i s i o n - m a k i n g   co m m i t te e   h a d   n o   m o re 
t h a n   5 0   %   p u b l i c - s e c to r   m e m b e r s,   a s   re q u i re d   by   t h e   re g u l a -
t i o n .   O n l y   t h e   L A G s   i n   Fr a n c e   h a d   i n t e r n a l   r u l e s   r e q u i r i n g   a 
‘doub l e quo rum’ w hereby  the ‘pr i vate’ s e c tor  m e mber s sh ould 
re p re s e n t   a t   l e a s t   5 0   %   o f   t h e   vo t e s   i n   e a c h   d e c i s i o n - m a k i n g 
mee t ing (al th ough  t his  r ul e was  no t al ways  fo llowed ).

 T h e   C o u r t   i d e n t i f i e d   a   n u m b e r   o f   o t h e r   c a s e s   w h e r e   t h e 
L e a d e r   p r i n c i p l e s   w e r e   n o t   s t r i c t l y   f o l l o w e d .   I n   F r a n c e 
 ( L a n g u e d o c – R o u s s i l l o n ) ,   t h e   c h a i r   o f   t h e   L e a d e r +   d e c i s i o n -
m a k i n g   c o m m i t t e e   h e l d   t h e   c a s t i n g   v o t e ,   e f f e c t i v e l y   g i v i n g 
t h e   p u b l i c   s e c to r   a   m a j o r i t y.  Th e  ‘p r i v a te’  m e m b e r s h i p   o f   t h e 
co m m i t te e   o f   t h e   L AG   i n   Fra n ce   ( Pays   d e   l a   Lo i re )   wa s   l a rg e l y 
com po se d o f as sociat ions  created by t h e loca l publ ic auth or i-
ties (see Box 4). This committee proposed projects to the Syndi-
cat of local authorities, which took the final decision on project 
grant s.

B oX   4

M E M B Er sH I P   o f  T H E   l aG   I N   f r aN C E   ( P ays   D E   l a   loIrE )

The LAG undertook an internal evaluation, which reported that ‘the composition of the decision-making 
committee raises the problem of the representivity of the ensemble of local actors. The private partners are 
almost all from the associations of the ‘Pa ys’ (a grouping of local  co m mu ne s). Each of these associations is 
presided by an elected member (of the communes). Even though these associations have a deep knowledge 
of the problems facing the local area, ... it would have been useful to integrate local business managers 
or associations that were not connected to the Pa y s. Moreover, neither the Chamber of Commerce and 
Industry or the Chamber of Trade was represented; only the Chamber of Agriculture had a representative 
on the decision-making committee.’

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23.  

 On occasions, the LAG in Por tugal took decisions on just a few 
votes from the local councils alone (see Box 5) 15. I n such cases, 
the potential added value of a par tnership in decision-mak ing 
wa s  no t b eing  achieved.

15  The LAG in Bavaria also approved 
project proposals with few members 

present (see Box 14).

24.  

25.  

a r e a - B a s e d  L o c a L  d e v e L o p m e n t  s t r a t e g i e s

 I n   t h e   a r e a - b a s e d   a p p r o a c h ,   L A G s   s h o u l d   d e f i n e   a n d   i m p l e -
ment   a  d evel o p ment   st rateg y  o n  th e   basis   of  th ei r   are a’s  own 
par ticular situation, strengths and weak nesses. To achieve the 
full potential of this, LAGs should translate their specific needs 
a n d   o p p o r t u n i t i e s   i n t o   l o c a l   o b j e c t i ve s   a n d   i m p l e m e n t   t h e i r 
strate gies  w ith  a fo cus  on  ach iev ing  t h ose   obj e c ti ve s.

 The LAGs’ objectives should define precisely the local outcomes 
that they plan to achieve with their strategies, thus providing a 
clear framework and guidance for the day-to - day management 
o f   t h e   p ro gra m m e s   a n d   a   b a s i s   fo r   p e r fo r m a n ce   m a n a g e m e nt 
an d acco u nt abilit y.

B oX   5

l aG   I N   Po rT U Ga l :  P a rT I C I P aT IoN   I N  V oT I N G

The LAG’s decision-making committee consisted of representatives of the three municipalities (who rotated 
the functions of President, Vice-President and Treasurer), a cultural association, an association of small busi-
nesses, an association of local industry and an agricultural association.

The Court’s auditors examined the minutes of the eight meetings at which the selected projects were ap-
proved. In three of the meetings, there were equal numbers of members from the municipalities and from 
other backgrounds. At the other five meetings, the three municipalities were in the majority. On two occa-
sions, the LAG selected projects on the votes of the three municipalities alone.

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26.  

27.  

LAGs did not have a strong focus on achieving local  (area-based) 
strate g y o b jec tives

 The LAG s’ Leader+ l o cal  s trategy  obj ec t ives  we re n ot s pec i f ic, 
measurable and achievable within a set time frame. M ost were 
so general that they could apply to any rural area (see example 
i n   B ox   6 ) .   O b j e c t i v e s   s u c h   a s  ‘t o   co m b a t   t h e   r u ra l   e xo d u s   a n d 
t h e   a b a n d o n m e n t   o f   t ra d i t i o n a l   a g r i c u l t u r e’  ( L AG   i n   Po r t u g a l ) 
c o u l d   h a v e   b e e n   m e a s u r a b l e ,   b u t   w e r e   n o t   s o   i n   p r a c t i c e   a s 
t h e r e   w e r e   n o   b a s e l i n e s   e s t a b l i s h i n g   t h e   i n i t i a l   s i t u a t i o n   o r 
targets showing the situation to be achieved. Objec tives were 
expressed in open- ended ter ms. An example is ‘to promote the 
i d e n t i t y   o f   t h e   a r e a   b y   i m p r o v i n g   a n d   p r o m o t i n g   l o ca l   s e r v i ce s 
a n d   p r o d u c t s’  ( L AG   i n   G re e c e ) ,   w h i c h   d e s c r i b e s   w h a t   t h e   L AG 
inte nd s to do,  no t a s itu ation it  ai ms  to ac h ie ve.

 The LAGs did not show a strong focus on achieving objec tives. 
I n   Fr a n c e   ( L a n g u e d o c - R o u s s i l l o n ) ,   f o r   e x a m p l e ,   t h e   L e a d e r + 
s t r a t e g y ’s   c e n t r a l   o b j e c t i v e   w a s   t o   u s e   n e w   t e c h n o l o g i e s   t o 
imp rove  the  co mp etitiveness   of   th e   r ural  a rea . wh en  th e  pos-
s i b i l i t y   o f   o b t a i n i n g   co - f i n a n c i n g   f ro m   a   n at i o n a l   p ro gra m m e 
fo r   to u r i s m   p ro j e c t s   a ro s e,   t h e   L AG   a d d e d   a   n e w   ex p e n d i t u re 
m e a s u re   t o   f i n a n c e   f a c i l i t i e s   s u c h   a s   a   m o u n t a i n - b i k i n g   c e n-
tre.

B oX   6

l aG   I N   ME C KlE N B Ur G- V o rPoM M ErN :  EX aM PlE   o f   loC a l 
sTr a T E Gy   oBjE C T I V Es

Four objectives were set: 

(1) improving the attractiveness of the area; 

(2) networking of the tourism regions; 

(3) new services and employment activities; 

(4) improvement of the regional economic structure through being open and encouraging new opportuni-

ties to create jobs.

Each of these was followed by a section headed ‘objective/strategy’, which described the situation and 
what the LAG intended to do, in general terms, such as ‘to support initiatives to qualify and train women 
and young people’. There were no specific statements about what was expected to be achieved through 
implementing the strategy. No baselines or targets were set for the strategy objectives.

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28.  

 L o c a l   s t r a t e g y   o b j e c t i v e s   w e r e   n o t   a   d e t e r m i n i n g   f a c t o r   i n 
p ro j e c t   s e l e c t i o n   ( s e e   B ox   7 ) .   As   a n   e x a m p l e,   t h e   L AG   i n   Po r -
tugal planned to finance tourism facilities ‘linked to the strong 
ter r ito r ial  th emes’ of the st rate gy :  th e  con f lue n ce of  t h e l oc al 
c u l t u re   a n d   t h e   r i ve r s.  T h e   L AG   aw a rd e d   a   g r a n t   t o   a   g o - k a r t 
cent re  fo r  t he  p u rchase  o f  addit ion al  k a r t s  a n d  t im in g   equi p -
ment,  wit h n o obviou s ter r itor ial  t he me.

B oX   7

l aG   I N   P o rT U Ga l :  P r o jE C T  To   P Ur C Ha sE   r o aD   sI G Ns

One of the LAG’s objectives was the study, development and promotion of themed tourist routes. The LAG 
used the budget for the corresponding measure to award a grant to the municipality to purchase road signs, 
including traffic instructions such as ‘Stop!’ signs, and to mark out white lines in the centre of local roads 
and in car parks. Some of the road signs indicated the directions to individual tourist attractions, but the 
project did not create any themed tourist routes as such.

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16  This also applies, to a lesser 
extent, in Ireland.

17  For example, following a 
call for proposals for tourist 

accommodation projects, the LAG in 

Greece approved grants for projects 

that exceeded the target number 

of new tourist rooms by 20 %. The 

LAG made a further call for tourist 

accommodation project proposals 

in view of the high demand.

18  A partial exception is the LAG 
in Bavaria, which organised a 

workshop to consider whether the 

Leader+ strategy objectives were 

met.

29.  

30.  

31.  

32.  

 T h e   L AG s   i n   G r e e c e,  Tu s c a ny,   a n d   S p a i n 1 6  i m p l e m e n t e d   t h e i r 
strate gies  in ter ms of  ‘meas u res’ de fi ne d by t he  M e mber  State 
to classify similar projec ts for budgetar y management and re -
p o r t i n g   p u r p o s e s.   Fo r   e x a m p l e,   t h e   L AG   i n   G re e ce   h a d   m e a s-
u re s   s u c h   a s  ‘i nve s t m e nt   s u p p o r t   fo r   e nt re p re n e u r s’.  Th i s   wa s 
s u b d i v i d e d   i n t o  ‘r u r a l   t o u r i s m   p r o j e c t s’,  ‘m o d e r n   t e c h n o l o g y 
projec ts’, etc. Each of these was fur ther classified into ‘ac tions’ 
s u c h   a s  ‘p ro v i s i o n   o f   t o u r i s t   a c c o m m o d a t i o n’.  T h i s   f a c i l i t a t e s 
monitor ing and control of the LAGs’ ac tivities, but also car r ies 
a   r i s k   t h at   L AG s   i m p l e m e nt   t h e   e x p e n d i t u re   m e a s u re s   ( by   a s-
s e s s i n g   a n d   s e l e c t i n g   p r o j e c t s   a c c o r d i n g   t o   t h e i r   e l i g i b i l i t y ) 
wi th ou t  re gard to th e l oc al  strate g y  obj ec ti ves.

 The LAGs adver tised for projec t proposals that met the eligibil-
it y conditions for a given measure, rather than adver tising for 
p r o j e c t s   t h a t   w o u l d   a c h i e v e   a   s p e c i f i c   o b j e c t i v e   o f   t h e   l o c a l 
strateg y. The  LAGs  as sess e d  th e ‘com plian ce’  or  ‘cohe re nce’  of 
t h e   p ro j e c t   p ro p o s a l   w i t h   t h e   s t r a t e g y   b u t ,   a s   t h e   o b j e c t i ve s 
w e r e   s o   b r o a d ,   i t   w a s   p r a c t i c a l l y   i m p o s s i b l e   t o   e l i m i n a t e   a n 
eligib l e  p ro jec t   u nl es s   th e  measure   was   over s ubscr i be d.  Eve n 
w h e n   o u t p u t   t a rg e t s   h a d   b e e n   m e t,   L AG s   co nt i n u e d   to   awa rd 
grant s 17.

 Monitoring and repor ting fur ther reinforced the measure -focus: 
L A G s   m o n i t o r e d ,   a n a l y s e d   a n d   r e p o r t e d   t h e   p r o j e c t s   i m p l e -
m e nte d   i n   re l at i o n   to   e a c h   ex p e n d i t u re   m e a s u re,   b u t   d i d   n o t 
collec t data on or assess whether the local strategy objec tives 
were  met.

 T h e   L A G   i n   I r e l a n d ,   f o r   e x a m p l e ,   p u b l i s h e d   a   r e v i e w   o f   i t s 
a c h i e ve m e n t s   a t   t h e   e n d   o f   t h e   Le a d e r +   p ro gr a m m e.  Th i s   re -
v i e w   c o n t a i n e d   a   s e c t i o n   e n t i t l e d  ‘ w h a t   we   p ro m i s e d ’,   w h i c h 
listed the strategy objec tives. The following sec tion was ‘ what 
w e   d e l i v e r e d ’,   w h i c h   d e s c r i b e d   t h e   p r o j e c t s   i m p l e m e n t e d . 
T h e s e   w e r e   g r o u p e d   b y   m e a s u r e ,   s u c h   a s  ‘ t r a i n i n g   p r o j e c t s’. 
Th e re   wa s   n o   i d e nt i f i c at i o n   o f   w h at   wa s   d o n e   —   o r   w h at   wa s 
ach ieved  — in relat ion  to t he st rateg y  obj ec t ives.  The  L AG s i n 
France and Germany, which were not required to follow nation-
al or regional measures, also repor ted in ter ms of the projec ts 
imp l em ented b ut  not  the o b jec ti ve s  ac hi eved 18.

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33.  

34.  

 At the time of the audit, most LAGs had not yet established their 
projec t selec tion criteria or monitoring and evaluation systems 
for the 2007–13 programming period but from the information 
available, LAGs have not planned significant changes. The LAGs’ 
Axis 4 strategie s al so  lac k sp ec ifi c  local obj ec ti ves  and  a ll but 
one of the Member States impose the use of common measures 
(see  p aragrap h 84 ).

i n n o v a t i v e   a n d  m u L t i s e c t o r a L  a p p r o a c h e s

 Leader is intended to be an innovative approach. LAGs should 
design and implement their strategies in a way to mobilise and 
deliver lo cal  ru ral devel o p ment t hroug h  i nn ovati ve res po ns es 
t o   o l d   a n d   n e w   r u r a l   p ro b l e m s.   L AG s   c a n   a d d   v a l u e   by   d o i n g 
s o m e t h i n g   d i f fe re nt   to   o t h e r   p ro gra m m e s   o r   t h e   a c t i v i t i e s   o f 
the local authorities. Projec ts that are within the normal ac tivi-
t i e s   o f   l o c a l   a u t h o r i t i e s,   o r   a re   e l i gi b l e   fo r   o t h e r   p ro gra m m e s 
s h o u l d   t h e r e fo r e   o n l y   b e   f i n a n c e d   b y   Le a d e r   p r o g r a m m e s   i n 
exceptional circumstances, duly justified in ter ms of a specific 
strategic nee d.

35.  

 A n o t h e r   d i s t i n g u i s h i n g   f e a t u r e   i s   t h a t   t h e   L e a d e r   a p p r o a c h 
should include the multisectoral design and implementation of 
the strategy, based on interac tion between ac tors and projec ts 
of d iffe rent sec tors o f the l ocal  e con omy.

L AG s   c o u l d   p r o v i d e   l i t t l e   e v i d e n c e   o f   i n n o v a t i o n   o r   i n t e r a c -
t i o n   b e t w e e n   s e c t o r s   i n   t h e i r   s t r a t e g i e s   o r   p r o j e c t s .   L AG s   f i-
nance d p ro je c t s t hat  were lit tle dif fe re nt  to th os e  of  ot h er  E U 
p ro gra m m e s   o r   t h at   co r re s p o n d e d   to   t h e   n o r m a l   a c t i v i t i e s   o f 
local  au t ho r it ie s

36.  

 Interac tion between ac tors of different sec tors occurred within 
the  LAG  p ar t ners hip,  as d es cr ib ed  in  paragraphs  1 8  to 2 3 ,  but 
n o t   to   a   s i gn i f i c a nt   ex te nt   i n   t h e   L AG s’  s t rate gi e s   o r   p ro j e c t s. 
S o m e   L AG s   c o u l d   d e m o n s t r a t e   e x a m p l e s   o f   i n t e r a c t i o n ,   s u c h 
a s   i n   I r e l a n d   w h e r e   t h e   s t r a t e g y   b r o u g h t   t o g e t h e r   p r o d u c -
ers,  re tail ers  and  t he  to u r ism  s ec tor   in  th e   mar k e ti ng   of   local 
p r o d u c t s .   H o w e v e r,   m o s t   L AG s   a w a r d e d   g r a n t s   t o   i n d e p e n d-
e n t   p ro j e c t s   s u p p o r t i n g   p ro m o t e r s   i n   t h e i r   n o r m a l   a c t i v i t i e s 
(see A nnex).

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37.  

38.  

 I n   Le a d e r + ,   m o s t   L AG s   h a d   e x p l i c i t   c r i t e r i a   t o   a s s e s s   p r o j e c t 
proposals for innovation or pilot charac ter (see Table 3) 19. D e -
spite these cr iter ia, LAGs approved projec ts that did not show 
strongly innovative charac teristics. I n Greece, for example, the 
grant application forms described innovative or pilot character-
istics of the planned investments in restaurants,  guesthouses, 
m e t a l   w o r k s ,   w i n e r i e s ,   e t c .   b u t   t h e s e   c h a r a c t e r i s t i c s   d i d   n o t 
exis t  in prac t ice  ( see B ox  8).

19  The LAGs’ assessment of 
project proposals is considered 

 in paragraph 58.

 In Tuscany, the LAG called for project proposals for the measure 
‘suppor t to enterprises for process and product innovation’. The 
LAG received a proposal by an apple producer for a project that 
c o n s i s t e d   m a i n l y   o f   p u r c h a s i n g   s t a n d a r d   f r u i t   c r a t e s ,   w h i c h 
t h e   L AG   c l a s s i f i e d   a s   a n  ‘i n n o v a t i v e   i nv e s t m e n t   fo r   r e d u c i n g 
produc tion costs and facilitating har vesting and pack aging’ on 
t h e   b a s i s   t h a t   i t   w a s  ‘i n n o v a t i ve   fo r   t h e   c o m p a ny   i t s e l f ’.  T h i s 
c l a s s i f i c a t i o n   g ave   t h e   p ro j e c t   7   o u t   o f   a   m a x i m u m   1 0   p o i n t s 
for innovation. The LAG in Hungar y assessed projec t proposals 
for ‘innovation and novelt y ’ and awarded the maximum points 
to all six of the projec ts examined. One projec t was for a guest-
house to upgrade its facilities — including purchasing bic ycles 
fo r   t h e   g u e s t s   to   u s e,   w h i c h   re p re s e nte d   a   n e w   f a c i l i t y   i n   t h e 
l o c a l   a r e a .   T h i s   w a s   n o t   t h e   c a s e   f o r   t h e   p r o j e c t   t o   p r e p a r e 
plans for paving a dir t road to the promoter ’s vineyards; or for 
t h e   p r o j e c t   t o   r e i n fo r c e   t h e   w a l l s   o f   a   p a r s o n a g e   b e c a u s e   o f 
sub side nce.

TaBlE   3

sElE C T IoN   o f   I N No VaT I V E   Pr o jE C T s

DE-BY 

DE-MV 

IE

EL

ES-A

ES-CM

FR (PL)

FR (LR)

IT-TOS 

HU

PT

The LAGs had explicit criteria to assess project for innovation or pilot project character

No

No

Yes

Yes

Yes

Yes

No

No

Yes

Yes

Yes

Weighting of the ‘innovation’ criterion in the overall assessment (%)

n.a.1

n.a.1

n.a.1

13

7

4

n.a.1

n.a.1

10–19

8

10

1 The LAGs in France and Germany did not document any assessment of projects against selection criteria. The LAG in Ireland did so but did 

not allocate points.

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39.  

40.  

 The Cour t obser ved in the 2000 Annual R epor t that LAGs gave 
grant s  to   pro je c ts  t hat  cou l d  h ave   be e n  f in an ce d  un de r   ot h er 
programmes. The Commission replied ‘… it may be appropriate 
to finan ce und er Leader cer tain in div i dual  pro jec t s th at  w he n 
v i e we d   i n   i s o l a t i o n   s h o u l d   b e   e l i g i b l e   u n d e r   t h e   m a i n s t re a m 
programmes, where these projec ts are an essential element for 
t h e   re a l i s at i o n   o f   a   p a r t i c u l a r   l o c a l   a c t i o n   gro u p’s   i n n ovat i ve 
devel o pme nt  p ro gramme’.

 M o s t   g r a n t s   w e r e   f o r   s m a l l   p r o j e c t s ,   t h e r e b y   d i s t i n g u i s h i n g 
Leader from other EU funding programmes. The LAG in I reland, 
fo r   ex a m p l e   g ave   gra nt s   ra n gi n g   f ro m   u n d e r   1   0 0 0   to   a   m a x i-
m u m   o f   6 5   0 0 0   e u r o.   H o w e v e r,   e i g h t   o f   t h e   1 1   Le a d e r +   L AG s 
f i n a n c e d   p r o j e c t s   w i t h   a   t o t a l   c o s t   o f   2 0 0   0 0 0   e u r o   o r   m o r e 
( s e e   l i s t   o f   p ro j e c t s   i n   A n n e x) .   I nve s t m e n t s   i n   w i n e r i e s,   o l i ve 
oil  m ill s,  vil lag e  renewal   p ro j ec ts,  e tc.   would  have   bee n  e li gi-
ble for other EU funding programmes. I n these cases, the LAGs 
could show that the projec ts were coherent with their strategy, 
b u t   gi ve n   t h e   l a c k   o f   s p e c i f i c   l o c a l   o b j e c t i ve s   ( s e e   p a ra gra p h 
26) , LAG s cou l d no t sh ow  that t he  proj e c ts  were e s se nt ial.

B oX   8

‘ P Ilo T   C Ha r aC T Er ’  o f   Pr o jE C T s   aP Pr o V E D   By  T H E   l aG   I N   GrE E C E

In all of the six private-sector projects audited, the application forms justified the pilot nature of the pro-
posal in terms of networking activities. The forms were all completed by consultants. However, the project 
promoters interviewed had not participated in any such activities. The promoter of the metal workshop 
project, for example, did not know of the local small enterprises network and was unaware that his project 
proposal involved participation.

Furthermore, the grant application described the project as being consistent with the LAG’s local strategy 
as it concerned traditional wrought iron products that helped preserve the traditions and character of local 
buildings. In practice, the applicant’s business almost entirely consisted of modern designs in aluminium.

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41.  

 Fu r t h e r m o re,   t h e   p o te nt i a l   fo r   a d d e d   va l u e   o f   t h e   Le a d e r   a p -
p r o a c h   i s   r e d u c e d   i f   i t   m e r e l y   a c t s   a s   a n   a d d i t i o n a l   f u n d i n g 
s o u rc e   fo r   n o r m a l   l o c a l   g o ve r n m e n t   a c t i v i t i e s.   w h i l e   m a n d a -
tor y   t as ks,  su ch  as   ed ucat io n,   were,  in  pr in ci ple,  exc lude d,   all 
of the LAGs awarded grants for projec ts promoted by the local 
authorities, with the exception of the LAG in Ireland (see Box 9 
and  th e l is t o f p roj ec ts in A n nex).   S ome  of  t he se  proj ec t s h ad 
a l r e a d y   b e e n   c o m p l e t e d   b e fo r e   t h e   a p p l i c a t i o n   fo r   a   Le a d e r 
grant (see Box 10, for example), in which case the grants ser ved 
only to  su pp lement th e loc al  auth or it ie s’  bud g et s.

B oX   9

EX aM PlEs   o f   l EaD Er +  Gr aN T s  To   loC a l   aU T Ho rI T I Es

LAG in Castilla-La Mancha: One of the municipalities that was a member of the LAG promoted a project for 
enclosing a children’s playground. The project consisted of constructing a rustic-style brick wall topped 
with a metal fence at a cost of 36 000 euro (of which 26 500 Leader grant from the EU, and 500 euro from 
the national and regional authorities).

LAG in Greece: One of the municipalities that was a member of the LAG promoted a project for renewing the 
drainage and resurfacing of the town-centre streets and pavements. The Leader+ funding (211 000 euro) 
covered the costs for a small area. The municipality obtained national financing for a total amount of 1,4 mil-
lion euro to complete the project for the remaining streets.

B oX   1 0

EX aM PlEs   o f   Gr aN T s  To   CoM PlE T E D   Pr o jE C T s

LAG in Tuscany: Project ‘services to the citizen and the local territory’. The LAG published a call for project 
proposals in May 2004 and decided at its meeting of 12 July 2004 to award a grant of 121 470 euro to a 
consortium of municipalities (which was a member of the LAG’s decision-making committee). The grant 
agreement was dated 20 September 2004. The project, which concerned a 24-hour public veterinary service 
and information and licensing for hunting, fishing and mushroom picking, had started in February 2001, 
with the final invoice dated 5 July 2004.

LAG in France (Pays de la Loire): A group of co m mun es (of which the president was a member of the LAG), 
undertook a project for the computerisation and networking of library records. The paying agency’s inspec-
tion report states ‘at the date the project application was made … the IT equipment was almost complete, 
the cataloguing had been done and the staff were being trained in using the software. … At the date the 
LAG selected the project, there remained an invoice of 91,20 euro to be paid’.

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42.  

 A t   t h e   t i m e   o f   t h e   a u d i t ,   i m p l e m e n t a t i o n   o f   A x i s   4   h a d   n o t 
s t a r t e d   i n   m o s t   o f   t h e   a u d i t e d   L AG s.   H owe ve r,   t h e   s t r a t e g i e s 
conta in few  sp ec ific commitm ent s to in n ovati on or  to obt ai n-
ing inte rac t io n b et ween t he sec tor s.

43.  

44.  

45.  

n e t w o r k i n g  a n d  c o o p e r a t i o n   p r o j e c t s

 N e t wo r k i n g   i nvo l ve s   t h e   exc h a n g e   o f   ex p e r i e n ce   a n d   a i m s   to 
t r a n s fe r   g o o d   p r a c t i c e,   d i s s e m i n a t e   i n n o v a t i o n   a n d   b u i l d   o n 
l e s s o n s   l e a r n e d .   Co o p e r a t i o n   p r o j e c t s   —   w h e r e   t w o   o r   m o r e 
LAGs par ticipate — can fur ther add value through critical mass 
and complementar it y, mak ing it possible to achieve outcomes 
that  a LAG co uld not  ac hieve alon e.

L A G s   d i d   n o t   a l l   f u l l y   p a r t i c i p a t e   i n   n e t w o r k i n g   a n d 
  coop erat io n pro j ec ts

 A l l   L AG s   at   l e a s t   p a r t i c i p ate d   i n   m e e t i n g s   w i t h   o t h e r   L AG s   i n 
t h e   r e g i o n a l   o r   n a t i o n a l   n e t w o r k s ,   a l t h o u g h   t h e s e   m e e t i n g s 
largely concerned organisational issues. The LAG in Ireland was 
par ticularly active in attending seminars, visiting and receiving 
L A G s   f r o m   o t h e r   M e m b e r   S t a t e s .   T h e   L A G s   i n   M e c k l e n b u r g -
Vor p om mer n,  I rel an d and Por t ug al contr i bute d g ood-prac ti ce 
exam pl e s of  p roj ec ts to EU  publi cat ion s  and  databas es.

 All LAGs par ticip ated in coop eration projec t s, wit h the excep -
tion of the LAG in Hungar y. LAGs in France, Tuscany and Greece 
encountered organisational difficulties, par ticular ly regarding 
d i f fe r e n t   p r o c e d u r e s   a p p l i e d   u n d e r   d i f fe r e n t   r e g i o n a l   o r   n a-
tional Leader programmes. S ome of the ac tivities financed re -
lated to visits, exchanges and conferences rather than the joint 
i m p l e m e n t a t i o n   o f   a   p r o j e c t .   T h e   L AG   i n   C a s t i l l a - L a   M a n c h a 
used   t he  co op e rat ion   proj ec ts '  bud ge t   to  pay   i ts   subs c r ipt ion 
t o   t h e   r e g i o n a l   n e t w o r k   o f   L AG s   a n d   t o   d e v e l o p   a   d o c u m e n t 
m a n a g e m e n t   s y s t e m   i n   p r e p a r a t i o n   f o r   t h e   2 0 0 7 – 1 3   p e r i o d . 
Such expenses should have been financed from the LAGs’ run-
ning  co st s’ b udg ets.

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46.  

 Except in Castilla-La M ancha, Hungar y and Por tugal, the LAGs’ 
Axis 4 strategies gave details of planned cooperation projec ts. 
There were few specific details for planned net wor k ing ac tivi-
ties.

20   It is a requirement of the 
 financial regulation that the EU 

budget is used in accordance with 

the principle of efficiency, defined 

as the best relationship between 

resources employed and results 

achieved.

soU N D N Es s   o f   T H E   l aG s ’   fI NaN C Ia l 
M aNa G E M E N T

l aG s   D I D   No T   Ha V E   D U E   rE Ga rD  To  T H E   N E E D 
f o r   Ef fI C I E N C y   o r   faIr   aN D  Tr aNsP a rE N T  
Pr oC E D UrEs

e f f i c i e n c y  o f  t h e  g r a n t   e x p e n d i t u r e

47.  

 L A G s   s p e n d   t h e   E U   b u d g e t   b y   a w a r d i n g   g r a n t s   t o   p r o j e c t s . 
C o n s e q u e n t l y,   t h e y   s h o u l d   e n s u r e   t h a t   t h e   g r a n t s   r e p r e s e n t 
the  mo st  effic ient  us e of t he publ ic f un din g 20.

48.  

49.  

L A G s   d i d   n o t   s e e k   t o   m a x i m i s e   t h e   e f f i c i e n c y   o f   t h e 
 grant  expe ndit ure

 O n e   o f   t h e   r i s k s   t o   t h e   e f f i c i e n c y   o f   a ny   g r a n t   p r o g r a m m e   i s 
t h a t   t h e   p ro m o t e r   m a y   h ave   u n d e r t a k e n   t h e   p ro j e c t   a ny w ay, 
w i t h o u t   t h e   g r a n t ,   w h i c h   r e s u l t s   i n  ‘d e a d w e i g h t ’ :   t h e   g r a n t 
d o e s   n o t   a c h i e ve   a n   a d d i t i o n a l   e f fe c t .   L AG s   s h o u l d   b e   b e t te r 
placed than ‘top - down’ programme managers to assess the risk 
of de adwe ig ht  b ecau se of t heir loc al k nowle dg e a nd  contac t s 
wit h t he p ro moter in p rep ar ing  th e  grant  appli c ati on.

 A strong indication of deadweight is if the promoter has already 
s t a r t e d   a   p ro j e c t   b e fo re   t h e   L AG   d e c i d e s   w h e t h e r   to   aw a rd   a 
g r a n t   o r   n o t .   E xc e p t   i n   G e r m a ny,   a l l   L AG s   a w a r d e d   g r a n t s   t o 
s u c h   p r o j e c t s .   E i t h e r   t h e   p r o j e c t   p r o m o t e r s   c o n c e r n e d   w e r e 
prepared to under take the project without the grant aid (which 
i n d i c ate s   d e a d we i g h t ) ,   o r   t h e y   h a d   b e e n   p ro m i s e d   a   gra n t   i n 
advance o f the p ro jec t as sessme nt a nd  de c is i on  proced ures.

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50.  

51.  

52.  

 Onl y t he LAG in I relan d had p roced ures  to ass e ss  proje c t pro -
pos al s  fo r  th e  r isk  of  deadwei ght   (al th oug h  eve n  th e re,   docu-
m e n t a t i o n   o f   t h e   c h e c k s   m a d e   w a s   i n a d e q u a t e ) .   O t h e r   L AG s 
t r e a t e d   t h e   s t a r t   d a t e   o f   t h e   p r o j e c t   a s   a   s i m p l e   q u e s t i o n   o f 
eligib il it y.

21  Except for grants to businesses, 
which are governed by the EU’s state 

aid rules.

 Each Member State applied different eligibility rules. In Greece, 
I r e l a n d ,   S p a i n   a n d   H u n g a r y,   p r o j e c t s   w e r e   e l i g i b l e   f r o m   t h e 
d a t e   o f   g r a n t   a p p l i c a t i o n .   I n   Po r t u g a l ,   p r o j e c t s   c o u l d   c o m -
men ce  90  d ays  b efore  the  ap p lic ati on .  I n  Fran ce  and  Tusc any, 
the rules only required that the projec t should not be finished 
a t   t h e   d a t e   o f   g r a n t   a p p l i c a t i o n 2 1.  T h e   L AG s   c o n s i d e r e d   t h a t 
this condition was met as long as the projec t promoter had not 
p a i d   th e   fi n a l   i nvo i ce   o f   t h e   p ro j ec t   co s t s,   e ven   if   t he   pro j e c t 
wa s  p hysical l y co mp l ete ( see B ox  10).

 Fur th er mo re, th e LAG s in France an d Tusc a ny  ope nl y  favoure d 
p ro j e c t s   t h at   we re   a l re a d y   co m p l e te d,   a s   t h e   gra nt s   co u l d   b e 
a p p rove d   a n d   p a i d   w i t h i n   a   s h o r t   p e r i o d,   w i t h o u t   t h e   r i s k   o f 
delays (s ee  B ox  11) . I n this way, th e L AG s cou ld avoi d  ‘de com-
m i t m e n t s’ :   t h e   p ro ce d u re   i n   w h i c h   s o m e   M e m b e r   S t a te s   c a n -
cell ed  the u nspent b al ance o f LAG s’  bud g e ts  at  th e  year- e n d.

B oX   1 1

EX aM PlEs   o f   l aG s   faV oUrI N G   CoM PlE T E D   Pr o jE C T s

LAG in Tuscany: The LAG’s call for proposals for the ‘renovation and improvement of villages’ set the project 
selection criteria, with a maximum of 30 points available. One criterion was for the ‘readiness’ of the project, 
with a maximum of 12 points to be awarded if the promoter could complete the final project payments 
within 30 days of submitting the project proposal.

LAG in France (Languedoc-Roussillon): A university association (which was a member of the LAG) undertook 
a project to renovate and open to the public an old arboretum, for which the final expenses were incurred 
in August 2008. The LAG selected the project on 16 September 2008 and signed the grant agreement on 
1 October. The minutes of the LAG meeting explain that, in order to use up the remaining Leader+ budget, 
it was necessary to select already-completed projects so that the grants could be paid out before the end 
of October.

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 A   f u r t h e r   r i s k   to   e f f i c i e n c y   i s   t h at   p ro m o te r s   m ay   n o t   s e e k   to 
i m p l e m e n t   t h e   p r o j e c t s   a t   t h e   l o w e s t   c o s t s   c o n s i s t e n t   w i t h 
t h e   n e c e s s a r y   q u a l i t y.   T h i s   r i s k   i s   i n c r e a s e d   w h e n   t h e   g r a n t 
rep re se nt s  a  high   p rop or t ion   of  th e   proje c t  cos ts   (s ome   L AGs 
awarded grants at 80 % or even 100 % of projec t costs 22). A risk 
a l s o   e x i s t s   t h a t   i nvo i ce s   m ay   b e   a r t i f i c i a l l y   i n f l a te d.   O n l y   t h e 
L AG s   i n   I r e l a n d ,   G r e e c e   a n d  Tu s c a n y   h a d   s a t i s f a c t o r y   p r o c e -
dures to assess the reasonableness of projec t costs for public - 
and  p r ivate -se c tor p rojec ts.

22   Including the national 
  co-financing.

23  This has the benefit of simplicity 
and transparency, but will not 

necessarily lead to the most efficient 

use of the EU budget.

 Th e   m o s t   e f f i c i e nt   gra nt   wo u l d   b e   t h e   m i n i m u m   a m o u nt   n e c -
e s s a r y   t o   m a k e   a   p r o j e c t   v i a b l e   a n d   e n s u r e   t h a t   t h e   d e s i r e d 
outcomes are achieved. However, many LAGs gave all projec ts 
t h e   s a m e   p e r c e n t a g e   g r a n t   ( u p   t o   t h e   m a x i m u m   a m o u n t   e l i-
g i b l e )   r e g a r d l e s s   o f   t h e   l i k e l y   p r o f i t a b i l i t y   o f   t h e   p r o j e c t   o r 
ava il ab ilit y o f ot her  f inancing 23.

 The  LAG  in   France  (Pays   de  l a  Loire )   in cre as ed   th e   grant  rate s 
at   t h e   e n d   o f   t h e   Le a d e r +   p e r i o d   to   e n s u re   t h at   i t   f u l l y   s p e nt 
its budget. This resulted, for example, in a local author it y that 
had applied for a grant of 12 000 euro for the computer isation 
a n d   n e t w o r k i n g   o f   l i b r a r y   r e c o r d s   b e i n g   a w a r d e d   a   g r a n t   o f 
over  25 000 euro  for  t he s ame proj e c t.

fa i r  a n d  t r a n s p a r e n t  p r o c e d u r e s

 L A G s   c o m m i t   p u b l i c   f u n d s   w h e n   s e l e c t i n g   p r o j e c t s ,   b u t   a r e 
not democratically accountable. Consequently, there is a need 
fo r   a   h i g h   d e g re e   o f   t r a n s p a re n c y   a n d   fo r   L AG s   t o   b e   a b l e   t o 
demons t rate t hat t hey  have con si stentl y  followe d proper  pro -
ced ures.

Proced ures  did not  s uf ficientl y m it ig ate  th e s peci f ic  r i sk s t hat 
stem  fro m t he del egation  of dec i si on- mak in g  to th e  L AG s

 O n l y   t h e   L AG s   i n   M e c k l e n b u rg -Vo r p o m m e r n   a n d   Fra n ce   ( Pays 
d e   l a   Lo i re )   p u b l i s h e d   m i n u te s   o f   p ro j e c t   s e l e c t i o n   m e e t i n g s 
o n   t h e i r   we b s i te s.   H owe ve r,   m o s t   L AG s   p u b l i s h e d   l i s t s   o r   d e -
t a i l s   o f   s o m e   o r   a l l   p r o j e c t s   i m p l e m e n t e d   b y   t h e   e n d   o f   t h e 
pro gra mme.

53.  

54.  

55.  

56.  

57.  

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58.  

 T h e   L A G s   i n   G e r m a n y   a n d   F r a n c e   d i d   n o t   h a v e   a n y   f o r m a l 
d o c u m e n t e d   p r o j e c t   a s s e s s m e n t   p r o c e d u r e s .   M i n u t e s   o f   t h e 
d e c i s i o n - m a k i n g   co m m i t te e s   g ave   b r i e f   ré s u m é s   o f   w h at   wa s 
d i s c u s s e d   i n   s o m e   c a s e s ,   b u t   d i d   n o t   c o n s i s t e n t l y   s h o w   t h e 
fac to rs  that we re t aken into account.  Th e L AGs  i n Gre ece, Por-
tugal, Spain, Hungar y and Tuscany assessed projec ts in a com -
p a r a t i v e   w a y   b y   s c o r i n g   p r o j e c t   p r o p o s a l s   a g a i n s t   s t a n d a r d 
projec t selec tion cr iter ia, which represents good prac tice, but 
t h e   b a s i s   f o r   t h e   s c o r e s   w a s   n o t   d o c u m e n t e d   i n   m o s t   c a s e s , 
and there were apparent inconsistencies (see Box 12). No LAGs 
d o c u m e n t e d   t h e   p r o j e c t   a s s e s s m e n t s   a n d   s e l e c t i o n   p r o c e s s 
s u f f i c i e nt l y   to   a l l ow   t h e   s o u n d n e s s   o f   t h e   d e c i s i o n s   to   b e   re -
viewe d.

59.  

 Given the local nature of LAGs, one of the greatest risks for ef-
ficienc y, the added value of the Leader programmes and for the 
rep ut at io n of t he EU is  t hat  of  a conf li c t  of  i nte re st s,  wh e reby 
a   p ro j e c t   p ro m o te r   m ay   i n f l u e n ce   t h e   p ro j e c t   s e l e c t i o n   d e c i -
sion in their favour. The r isk is heightened in LAGs that do not 
have transparent, objec tive and well- documented procedures, 
as il l u st rated ab ove.

33

24   Council Regulation (EC, Euratom) 
No 1605/2002 of 25 June 2002 on 

the financial regulation applicable to 

the general budget of the European 

Communities (OJ L 248, 16.9.2002, 

p. 1), Article 52:  

1. All financial actors and any 

other person involved in budget 

implementation, management, 

audit or control shall be prohibited 

from taking any action which 

may bring their own interests 

into conflict with those of the 

Communities. Should such a case 

arise, the person in question must 

refrain from such actions and 

refer the matter to the competent 

authority. 

2. There is a conflict of interests 

where the impartial and objective 

exercise of the functions of a 

financial actor or other person, 

as referred to in paragraph 1, is 

compromised for reasons involving 

family, emotional life, political or 

national affinity, economic interest 

or any other shared interest with the 

beneficiary.

B oX   1 2

as sEs sM E N T   o f  T H E   E M Ploy M E N T   Ef fE C T   o f   Pr o jE C T s   By 
T H E   l aG   I N   P o rT U Ga l

The LAG gave a score to each project proposal but had no documentation of its assessment of selection 
criteria such as ‘maintenance and creation of employment’. Consequently, it was unable to explain the ap-
parent inconsistencies. For example, the project proposal ‘investments in a honey packaging plant’ involved 
creating two new jobs. The LAG awarded the proposal five points for the employment criterion.

Two further proposals (both promoted by LAG member organisations) were also awarded five points: ‘pur-
chase of camcorder and projector for a cultural association’, which claimed to contribute to maintaining 
one existing job; and the municipal road signs project (see Box 7), which did not involve the creation or 
maintenance of employment.

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60.  

61.  

 Th e   r i s k   o c c u r s   m o s t   d i re c t l y   w h e n   t h e   p ro j e c t   p ro m o t e r   i s   a 
member of the LAG’s decision-mak ing body. Also in small LAGs, 
a   L AG   m e m b e r   h a s   t h e   o p p o r t u n i t y   to   i n f l u e n ce   t h e   d e c i s i o n 
even without par ticipating in the voting. The Greek authorities 
p ro h i b i te d   L AG s   awa rd i n g   gra nt s   to   L AG   s t a f f   o r   m e m b e r s,   to 
s u r ro g ate   n at u ra l   o r   l e g a l   e nt i t i e s   o r   to   s p o u s e s   a n d   f i r s t   d e -
gree relatives. None of the other LAGs had such rules. The rule 
i n   G re e c e   d i d   n o t   a p p l y   t o   L AG   m e m b e r s   i n   t h e i r   c a p a c i t y   a s 
representatives of public or non-profit organisations, although 
grants awarded in such cases were limited to 25 % of the LAGs’ 
bud ge t.

 A l l   o f   t h e   a u d i te d   L AG s   g ave   gr a n t s   to   t h e i r   ow n   m e m b e r   o r-
g a n i s a t i o n s   ( s e e   p a ra gra p h s   2 4   to   3 3 ) .  Th e s e   gra nt s   we re   n o t 
t r e a t e d   a s   e x c e p t i o n s .   L A G s   h a d   d i f f e r e n t   i n t e r n a l   r u l e s   f o r 
their decision-mak ing committees (see Box 13). These fall shor t 
of the requirements of the EU financial regulation 24. In par ticu-
l a r,   t h e   r u l e s   i n   s o m e   L AG s   co n c e r n e d   o n l y   m e m b e r s   d i re c t l y 
p r o m o t i n g   a   p r o j e c t   a n d   r e q u i r e d   o n l y   a b s t e n t i o n   f r o m   t h e 
vote.

B oX   1 3

as sEs sM E N T   o f   l aG s ’  Pr oC E D UrEs  
I N T ErEsT   (l EaD Er + )

 To   aV oI D   CoNf lI C T s   o f 

Background

Members of the decision-making committee should not award grants in situations where they have a ‘shared 
interest’ with the project promoter in the terms of Article 52(2) of the financial regulation.

A shared interest is likely to exist in particular with projects promoted by members of the LAG management 
structure or decision-making committee, as the LAG’s assessment of the project proposal may be influenced 
(even unconsciously) by the relationship with the project promoter. This applies whether the LAG member 
is promoting the project in a personal capacity or representing a public or private organisation.

Criteria

1.  If a member of the LAG’s assessment or selection decision-making committee has any professional or 
personal relation with the project promoter, or any professional or personal interest in the project, they 
should make a written declaration explaining the nature of the relationship/interest, which should form 
part of the project file. Any shared interest should be declared, including family, emotional, political and 
economic interests, as per the financial regulation.

2.  The member concerned should not participate in any way in the assessment or selection process, and 
should not be present during discussion of the project proposal. This should be documented in the min-
utes.

3. where there is a shared interest, LAGs should refer the matter to the managing authority in accordance 

with the financial regulation.

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Declaration of 
interests and 
non-participation
in vote

Referral to 
managing 
authority

Comments

The operating rules provided that LAG members with an 
interest in a project should not participate in the discussion 
or vote and that this should be documented. 
Meeting minutes did not always show who was present and 
who voted. The managing authority considers that the rules 
do not apply to representatives of public-sector organisations 
that are promoting projects.

The LAG’s rules provided that LAG members with an interest
in a project should not participate in the discussion or vote. 
There was no documentation of such non-participation in the
meeting minutes.
The LAG’s rules required members to absent themselves 
from the meeting during the discussion of project proposals
in which they had an interest, or if they had participated 
in the prior assessment of the projects. The LAG also 
maintained a register of members’ interests and the 
members were subject to a rotation policy. 
National rules required decisions concerning projects in 
which a LAG member or staﬀ had any interest to be notiﬁed
to the managing authority before formal approval of the 
project. Note: the operation of this procedure was not 
checked in this audit. 

Members of the LAG’s decision-making committee or 
management structure and their ﬁrst degree relatives could
not promote Leader projects in a personal or business 
capacity. However, this did not apply to LAG members 
representing non-proﬁt organisations, and these members 
were permitted to participate in the vote.

The LAG’s rules provided that LAG members with a direct or
indirect interest in a project should not participate in the 
discussion or vote. Note: the operation of this procedure was
not checked in this audit.

The LAG’s rules provided that LAG members with an interest in
a project should not participate in the discussion or vote, but 
this only applied to personal or economic interests. 
Meeting minutes did not show the representatives of the local 
authorities abstaining from votes on their projects.

The LAG’s rules required a member directly promoting a project
to abstain, but not to leave the room. The minutes of the 
decision-making committee meetings show that the promoter 
participated in the discussions and on occasions that the voting 
was unanimous, without any mention of the promoter 
abstaining. The rules did not apply to members with an interest 
in a project that they were not promoting themselves.

The LAG did not have any formal rules. Minutes show occasions 
on which a project promoter took part in discussions and the 
voting.

The LAG did not have formal rules despite a managing authority
requirement that they should.

The rules applied only to LAG members with a personal interest in
a project proposal, who were required to declare the interest before
the meeting and not participate in the discussion or vote.

LAG members with an interest in a project proposal were required 
to abstain from the vote, but did not have to leave the room and 
could participate in the discussion. Meeting minutes did not always
show the representatives of the local authorities abstaining from 
votes on their projects.

B oX   1 3

LAG

DE-BY

DE-MV

IE

EL

ES-A

ES-CM

FR (PL)

FR (LR)

IT-TOS

HU

PT

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

Findings:

Criterion met  

Criterion not met

Criterion not tested

36

62.  

63.  

 D o c u m e n t a t i o n   o f   t h e   v o t i n g   w a s   i n a d e q u a t e   i n   f i v e   o f   t h e 
11  Le ade r+  L AGs,  as the minu tes of  th e d eci si on- mak i n g  com-
mittees   did  no t   al ways  sh ow   who  was   pre se nt  an d  wh o  voted 
( s e e  B ox   1 3 ) .   I n   B av a r i a ,  Tu s c a ny   a n d   t h e   L AG s   i n   Fr a n c e,   t h e 
m i n u t e s   s h o w   o c c a s i o n s   o n   w h i c h   t h e   p ro j e c t   p r o m o t e r   p a r-
ticipated in the discussion of the projec t and in the voting (see 
B ox  14).

 The examples described in this repor t show projec ts that were 
o n l y   l o o s e l y   re l a t e d   t o   t h e   s t r a t e g y   o b j e c t i ve s,   p ro j e c t s   t h a t 
had already been completed and projec ts that subsidised nor-
m a l   l o c a l   g ove r n m e n t   a c t i v i t i e s.   M o s t   o f   t h e s e   p ro j e c t s   we re 
pro mo ted by  th e L AGs’ ow n mem ber  o rga n isati ons  ( se e  B oxes 
7 ,   9 ,   1 0 ,   1 1 ,   1 2   a n d  1 4) .  T h e   w e a k n e s s e s   o b s e r v e d   h i g h l i g h t 
the  r isk t hat  t he LAG mem ber s m ay  h ave d irec tl y or  in d ire c tly 
influenced the decisions in a way that resulted in an ineffec tive 
or  ine ffic ient  us e of t he EU  b ud ge t.

B oX   1 4

l aG   I N   B aVa rIa :  NoN -rEsP E C T   o f  V oT I N G   r UlEs

The project to construct a swimming lake was included in the LAG’s strategy with a Leader contribution of 
150 000 euro.

The actual Leader contribution was 1,03 million euro: almost 50 % of the LAG’s total budget. Although the 
LAG’s rules of procedure required a quorum of six members to take decisions, documentation showed that 
only four voted when approving the project. The names of the people present were not recorded except for 
the chairman of the LAG, who was the mayor of the town promoting the project. According to the Bavarian 
Leader+ operating rules, LAG members were not allowed to discuss and vote on projects in which they had 
an interest and this abstention had to be documented. In response to the Court’s observation, the Bavarian 
authorities replied that they consider the mayor’s participation acceptable as he did not have a p ers onal 
interest in the project.

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25   Defined in the regulation as 
studies of the local area, information 

and promotional events, etc.

64.  

65.  

66.  

67.  

o p e r a t i o n a L  e f f i c i e n c y

 LAGs incur running costs: staff salaries, offices, travel, publicity, 
etc.  I n the  interes t s o f eff ic ienc y, th es e  sh ould be l imi te d and 
kept within the budgets approved by the managing authorities. 
Hav in g  lo c al st aff  in l ocal  office s d eal in g  wi th  a sma ll numbe r 
of projec ts should also permit LAGs to be more responsive than 
woul d   b e  p oss ibl e  in   a  nat ion ally   or   re gion all y- man ag e d  pro -
gra m me.  Th i s   s h o u l d   re s u l t   i n   mo re   ra pi d   pro ce s s i n g   o f   gra nt 
applications and payments and less need for bureaucratic pro -
ced ures. 

The administrative requirements at local level have resulted  in  
 significant operating costs, voluminous  paper wor k and  delays

 The n o n-p roj ec t cos ts inc u r red by  t he  audi te d L AGs  var y  f rom 
1 2   %   to   3 2   %   o f   t h e   p u b l i c l y - f u n d e d   e x p e n d i t u re   i n   Le a d e r + . 
The costs budgeted by the LAGs for the 2007–13 programming 
per io d range  f rom 6  % to  28  % (s ee  Fi g ur e s  5 an d 6 ) . 

 T h e   d a t a   a b o v e   i n c l u d e s   L A G   c o s t s   f o r  ‘a n i m a t i n g   t h e   t e r r i-
tor y ’  (s timul at in g   l o c al   intere st ) 25.  L AG s  gen erally   cla sse d  t he 
wo r k   d o n e   by   t h e i r   s t a f f   i n   e n co u r a gi n g   p ro j e c t   p ro p o s a l s   a s 
animation. Some LAGs also considered the time spent assisting 
p ro j e c t   p ro m o te r s   to   m a k e   t h e i r   gra nt   a p p l i c at i o n s,   a n d   t i m e 
spent monitor ing and repor ting on projec t implementation as 
a n i m a t i o n .   S e ve r a l   L AG s   d i d   n o t   d i s t i n g u i s h   a n i m a t i o n   c o s t s 
f r o m   a d m i n i s t r a t i v e   a n d   m a n a g e m e n t   c o s t s   a n d   t h e   o t h e r s 
mad e an ar bit ra r y app o r tio nme nt  of  s ta ff  t ime.

 M o s t   L AG s   n o m i n a l l y   re m a i n e d   w i t h i n   t h e i r   Le a d e r +   r u n n i n g 
cos ts’  b udg e ts  al t houg h,  due  to  low   l eve ls  of   i mple me nt at ion 
in LAGs such as Hungar y, this represented a higher percentage 
of total expenditure than originally planned. The LAG in Ireland 
e x h a u s t e d   i t s   r u n n i n g   c o s t s’  b u d g e t   a n d   u s e d   i t s   a n i m a t i o n 
b u d g e t   a n d   a d d i t i o n a l   f u n d i n g   f ro m   t h e   m a n a g i n g   a u t h o r i t y 
to cove r t he co sts.  Th e LAG  in  Cas ti lla -L a M an c ha us ed  th e co -
ope rat io n bu dg et fo r r unning cos ts  ( se e paragraphs  43  to 4 6 ) . 
O the r LAGs ha d to  us e t heir own  f un d s.

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fI G UrE   5

NoN - Pr o jE C T   C o sT s   a s   a   P Er C E N TaG E   o f   lEaD Er +   P U BlI C 
E X P E N D I T UrE   ( I N Cl U D I N G   aN I M aT IoN )

35 %

30 %

25 %

20 %

15 %

10 %

5 %

0 %

DE-BY

DE-MV

IE

EL

ES-A

ES-CM FR (PL)

FR (LR)

IT-TOS

HU

PT

Animatio n cost s

Run nin g costs

Total

fI G UrE   6

NoN - Pr o jE C T   C o sT s   ( I N Cl U D I N G   aN I M aT IoN )   a s   a   P Er C E N TaG E 
o f l a G s’   aX Is  4  B U D G E T s

30 %

25 %

20 %

15 %

10 %

5 %

0 %

DE-BY DE-MV

IE

EL

ES-A ES-CM FR (PL) FR (LR) IT-TOS

HU PL (WP) PL (WŚ) PT

Animatio n cost s

Run nin g cost s

Total

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 O p e r a t i n g   c o s t s   d o   n o t   n e c e s s a r i l y   r e p r e s e n t   i n e f fe c t i v e   e x -
pend itu re.   Fo r  examp l e,   the  LAG   in  I rel an d  h ad  h i gh   cost s  for 
animation because it employed 2,5 full-time equivalent projec t 
development staff, who were ver y ac tive in stimulating the lo -
cal ru ral  d evelo p ment (s ee p a ragra ph  1 5 ).

26   In some Member States the 
national and regional authorities 

are responsible for these processes, 

which also contributes to the time 

taken.

 In addition to the above issues, the data cannot be used to com-
pare  ef ficie nc y bet ween different program me s d ue to t h e d if-
fere nt  res po nsib ilit ies  of  t he LAG s  in  proce ss in g  proj ec t gra nt 
a p p l i c a t i o n s   a n d   p a y m e n t s.   I n   H u n g a r y,   t h e   L AG   h a d   n o   fo r -
mal  ro l e  in  t he  p ro ces s o nce  it  for wa rd ed   th e  lis t  of   propos e d 
projec ts to the managing author it y, which was responsible for 
th e  ch eck s  o n  el igib il it y,  t he  grant   d ec i s ion ,   grant   a gre em ent 
and all stages of monitoring projec t implementation, repor ting 
and   p ayment.   B y  co ntras t,  the  L AG  i n  I rel an d  was   re s pons ibl e 
for the whole process from developing the projec t to check ing 
imp l em ent atio n and  m ak ing the  gra nt pay ments.

 In practice, implementation of Leader+ was overly bureaucratic: 
most LAGs required long and detailed grant application for ms 
with multiple annexes and suppor ting documents even for the 
smallest projects (see Box 15), although it should be noted that 
t h e   p ro ce d u re s   we re   a l m o s t   a l l   d e f i n e d   by   t h e   M e m b e r   S t a te 
a u t h o r i t i e s ,   n o t   t h e   L AG s .   L AG   s t a f f   a s s i s t e d   p r o m o t e r s   w i t h 
the administrative process, but even with this help, a sur vey of 
projec t promoters by the LAG in France (Languedoc-Roussillon) 
found that 47 % considered the process of applying for a grant 
to b e ‘rel at ively  difficul t ’.

 Data available on the time taken for approval of grant applica-
tions and payments was not complete or consistent, but shows 
t h a t   m o s t   L AG s   t o o k   s e ve r a l   m o n t h s   t o   p ro c e s s   t h e   f i l e s 2 6.   I n 
c o n t r a s t ,   o n   o c c a s i o n s   t h e   L AG   i n   I re l a n d   re c e i ve d   a n d   p ro c -
e s s e d   t h e   p a y m e n t   r e q u e s t   a n d   m a d e   a   p a y m e n t   t o   t h e   p r o -
m o t e r   o n   t h e   s a m e   d a y.   D e l a y s   i n   H u n g a r y   w e r e   c a u s e d   b y 
incomplete or inaccurate applications for projec t approval and 
fo r   p ay m e n t s,   i n d i c a t i n g   t h a t   t h e   p ro c e d u re s   m ay   h ave   b e e n 
overly complex for an aid scheme targeted at small-scale local 
pro jec t s.

68.  

69.  

70.  

71.  

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B oX   1 5

EX aM PlEs   o f   o V Er ly   B UrEa U Cr a T I C   Pr oC E D UrEs

LAG in Greece: Potential promoters had to complete an application of around 22 pages and submit 15 sup-
porting documents including proof of age, proof that military service had been completed, proof that he 
was not a civil servant, proof that he was not retired on ill-health grounds, etc. Incomplete applications 
were rejected. The guide for promoters for the payment request amounted to 32 pages.

LAG in Hungary: The application for the parsonage project amounted to 60 pages for a grant of around 
4 500 euro. Another project application contained 126 pages for a grant of around 5 400 euro.

The LAG took seven months to process and submit the project applications to the regional paying agency 
for checking and approval. The total period from application to signature of the contract for the six project 
files examined was between 11 and 16 months.

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 TH E   CoM M Is sIoN   aN D   ME M B Er   s TaT Es ’ 
M aNa G E M E N T   o f  T H E   l EaD Er   Pr oGr aM M Es

TH E   CoM M Is sIoN   aN D   ME M B Er   s TaT Es  wErE  
No T   sUf fI C I E N Tly   D E M aN D I N G   aN D   sHa rE   s oM E  
rEsPoNsI B IlI T
T H E   Po T E N T Ia l   aD D E D  Va lU E   o f  T H E   l EaD Er 
aP Pr o a C H . TH Ey   Ha V E   No T  TaK E N   sUf fI C I E N T  
aC T IoN  To   lI M I T  T H E   Co sT s   aN D   rIsKs

y  wI T H  T H E   l aG s   f o r   lI M I T I N G  

c o m m i s s i o n  a n d m e m B e r s t a t e s’  r e q u i r e m e n t s  f o r L e a d e r+

72.  

 The added value of the Leader approach is not obtained by the 
Co m m i s s i o n   o r   t h e   M e m b e r   S t a t e s   —   b u t   t h ro u g h   t h e   a c t i v i-
ties of the LAGs. Similarly, the primar y responsibilit y for sound 
financial management lies with the LAGs, as they take the deci-
sions on spending the EU budget. The Commission and Member 
S t ate s   c a n   gi ve   g u i d a n ce   to   t h e   L AG s   a n d   s h o u l d   e n s u re   t h at 
t h e   l e gi s l at i o n ,   o p e rat i n g   r u l e s   a n d   m a n a g e m e nt   s ys te m s   s e t 
t h e   m i n i m u m   s t a n d a rd s   re q u i re d ;   c re a t e   t h e   r i g h t   i n c e n t i ve s 
for the LAGs to add value and achieve sound financial manage -
ment ;  and avoid o b stac les  and d isi n ce nt ive s.

M e m b e r   S t a t e s   d i d   n o t   s e t   o r   e n fo r c e   e f fe c t i v e   m i n i m u m   r e -
q u i r e m e n t s   fo r   s o u n d   f i n a n c i a l   m a n a g e m e n t   a n d   t h e   Le a d e r 
app ro ach, des pite the Co mmissi on’s  en courag em e nt

73.  

 The r isk s to  so und financial  man ag em ent de sc r i bed  in  th i s re -
p o r t   a re   we l l   k n ow n   —   n o t   l e a s t   f ro m   t h e   Co u r t ’s   A n n u a l   R e -
p o r t   2 0 0 0 ,   w h i c h   n o te d   s i m i l a r   we a k n e s s e s :   L AG s   b a c k d at i n g 
grants resulting in a risk of deadweight; lack of transparenc y in 
project selection; potential conflicts of interest; high operating 
cost s a nd l eng thy  p rocedures.

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74.  

75.  

76.  

77.  

 A t   t h e   t i m e ,   t h e   C o m m i s s i o n   r e p l i e d   t o   t h e   C o u r t ’s   o b s e r v a -
tions that it ‘encouraged the use of open and transparent pro -
ced ures’; ‘enco uraged LAGs  to grant  a le ve l of a i d appropr i ate 
to the circumstances of each projec t ’; had ‘raised the question 
o f   p ay m e nt   d e l ays   w i t h   t h e   M e m b e r   St ate s’ ;  ‘i nv i te d ’  M e m b e r 
States to limit Leader+ operating costs to 15 % of the LAGs’ to -
tal budget; and that the Structural Funds’ implementing regula-
tion introduced limits that should avoid grants being awarded 
to   p ro j e c t s   t h at   we re   co m p l e te d   b e fore   t h e   gra nt   a p p l i c at i o n 
wa s  ma de.

 The Commission established a Leader+ Obser vator y with a con-
tac t point, which organised and promoted seminars, produced 
publications and maintained databases. These ac tivities aimed 
at shar ing best prac tice bet ween the LAGs and suppor ting the 
managing  au t ho r ities and  the n ati on al or   regi on al n et wor ks.

 T h e   l e g i s l a t i o n   s e t   fe w   r e q u i r e m e n t s   a t   E U   l e v e l   fo r   Le a d e r + 
o t h e r   t h a n   t h e   g e n e r a l   e l i g i b i l i t y   c o n d i t i o n s ,   r e p o r t i n g   a n d 
control systems that applied to all Structural Fund expenditure. 
Member States (or regions) developed their own arrangements 
a n d   o p e r a t i n g   r u l e s ,   w h i c h   t h e   C o m m i s s i o n   a p p r o v e d   a t   t h e 
star t  o f t he Le ader+ p er io d.

 E a c h   M e m b e r   S t a t e   s e t   d i f f e r e n t   r e q u i r e m e n t s   f o r   t h e   L A G s 
t o   fo l l o w   ( s e e   B ox   1 6) .   Fo r   e x a m p l e,   t h e   I r i s h   a u t h o r i t i e s   r e -
q u i r e d   L AG s   t o   a s s e s s   p r o j e c t   p r o p o s a l s   fo r   d e a d w e i g h t   a n d 
displ ace ment,  bu t  ot her  managin g   au th or i ti e s   di d  no t.  wh ere 
the M ember State did not set requirements, or where they did 
n o t   p ro p e r l y   s u p e r v i s e   a n d   e n fo rce   t h e m ,   t h e   L AG s’  p e r fo r m -
a n c e   w a s   l a x ,   a s   s h o w n   i n   p a r a g r a p h s   1 2   t o   7 1 .   wi t h   fe w   e x -
cept ion s,   t he  L AG s  d id   l ittl e  mo re   t han   fol low  th e  proce dure s 
established by the Member States: LAGs did not achieve the full 
advantages of the Leader approach or self-regulate to achieve 
sou nd f inanc ial  manag ement  of  th ei r  own  acco rd.

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78.  

79.  

 M emb e r  St ate   rul es   effec tively   con don e d  poor   f in anc i al  man-
a g e m e nt   i n   a l l ow i n g   gra nt s   to   b e   m a d e   to   p ro j e c t s   t h at   co m-
men ced b efo re the LAG  h ad de c ide d o n t he  grant  appl icat ion . 
T h e   r u l e s   d i d   n o t   o b l i g e   L AG s   t o   g i v e   g r a n t s   r e t r o s p e c t i v e l y, 
but t hey g ave th e message  that  it  was  acce pta bl e to d o so.

 A par ticular weak ness in all Member States’ implementation of 
Leader was that they did not hold LAGs accountable for achiev-
ing t he  ob je c tives of their l oc al s trategie s. Th ey  approved  t h e 
LAG’s Leader+ strategies with general, open- ended objec tives 
a n d   d i d   n o t   re q u i re   L AG s   t o   m o n i t o r,   a s s e s s   o r   re p o r t   o n   t h e 
a c h i e v e m e n t   o f   t h e i r   s t r a t e g y   o b j e c t i v e s ,   o r   d i d   n o t   e n fo r c e 
such  requ ire ment s.

B oX   1 6

EX aM PlEs   o f   D If fErE N T   I M PlE M E N T aT IoN   rEqU IrE M E N T s

Tuscany introduced requirements for the key local actors to be represented in the LAG.

Ireland set rules to ensure a fair and transparent process to nominate and decide on the LAG member-
ship.

The French rules required LAGs to have a ‘double quorum’ in the decision-making committee to ensure that 
there was an active partnership.

Managing authorities in Greece, Hungary and Tuscany required LAGs to score each project against a com-
mon set of objective criteria.

In Greece, the managing authority imposed a limit of 25 % of the grants awarded to LAGs’ own member 
organisations, thereby requiring the LAG to involve the wider local community in implementing the strat-
egy.

In Ireland, the operating rules specified that ‘if projects qualify for aid under other schemes and programmes, 
they should as a general rule be regarded as ineligible for aid under Leader’.

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c o m m i s s i o n  a n d m e m B e r s t a t e s’  r e q u i r e m e n t s  f o r a x i s 4

80.  

 Th e   Co m m i s s i o n   a n d   M e m b e r   S t ate s   s h o u l d   h ave   l e a r n e d   t h e 
lesso ns   fro m  p re viou s  Leader  progra mmi n g  pe r i ods   to  e n sure 
that the appropriate guidance and requirements were in place 
for t he 2007– 13  p er iod.

27   with the exception of the 
managing authorities in Germany 

and Aragón.

T h e   m a j o r   c h a n g e   f o r   t h e   2 0 0 7 – 1 3   p e r i o d   i s   t h a t   M e m b e r 
S t a t e s   m o s t l y   r e q u i r e   L A G s   t o   i m p l e m e n t   m a i n s t r e a m   r u r a l 
 devel o pme nt  p ro gramme mea sures

 Fo r   t h e   2 0 0 7 – 1 3   p ro gra m m i n g   p e r i o d,   t h e   l e g a l   f ra m e wo r k   i s 
est ab l ished by  t he r ural  developme nt  reg ulat ion s.  As in  Le ad-
e r + ,   t h e re   a re   fe w   l e g a l   re q u i re m e n t s   s p e c i f i c   t o   Le a d e r.  T h e 
reg ul atio ns  limit  LAG r un nin g cos ts,  but  at 2 0  %  th is  i s h ig h er 
than   in  Le ade r+   and  can  b e  circ umve nte d  by   c las si fy in g   cos ts 
as animation, which is not limited. The change from the Struc -
t u ra l   Fu n d   to   t h e   r u ra l   d e ve l o p m e nt   re g u l at i o n s   i nt ro d u ce s   a 
req uirem ent  to  chec k th e reas on able ne ss  of  pro jec t  cos ts.

 The Commission issued guidance to the M ember States for the 
preparation o f Axis 4 and effec tively approved the national or 
re gi o n a l   Le a d e r   p ro gr a m m e s   i n   a p p rov i n g   t h e   r u r a l   d e ve l o p -
ment  p rogramm es. Sin ce t hen , t h e  Commi s sio n h as cont in ued 
to  give   sup po r t,  in  p ar ticu l ar  t hro ug h   th e  Euro pea n  R ural  D e -
velop me nt  Net wor k .

 M e m b e r   S t a t e s   h a d   n o t   f i n a l i s e d   t h e i r   o p e r a t i n g   r u l e s   a t   t h e 
t i m e   o f   t h e   a u d i t 2 7,   s o   t h e s e   co u l d   n o t   b e   a s s e s s e d.   Fro m   t h e 
information available, the weak nesses identified in this repor t 
are  lik ely  to p er sist.

81.  

82.  

83.  

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84.  

85.  

86.  

 T h e   l a c k   o f   f o c u s   o n   a c h i e v i n g   l o c a l   s t r a t e g y   o b j e c t i v e s   i s 
l i k e l y   to   b e   e x a ce r b ate d   i n   t h e   2 0 0 7 – 1 3   p ro gra m m i n g   p e r i o d 
as, cont rar y to  t he Co mmiss ion’s g uid an ce 28, all th e man agin g 
authorities audited (with the exception of Bavaria) now require 
LAG s to  fol l ow  a co mmo n s et  of  me asures  d efi n e d in t he  r ural 
devel o pm ent  p rogrammes.

 S o m e   M e m b e r   S t a t e s   f u r t h e r   r e s t r i c t e d   t h e   s c o p e   o f   L e a d e r 
p r o g r a m m e s   t o   s p e c i f i c   m e a s u r e s ,   m o s t   c o m m o n l y   t h o s e   o f 
A x i s   3 2 9.  Th i s   s e ve re l y   l i m i te d   t h e   L AG s’  a b i l i t y   to   p ro p o s e   l o -
cal s trategies  for t he key o bj e c t ives  of  Axe s  1  an d 2  o f t h e r u-
ra l   d e ve l o p m e n t   p ro gra m m e s   re l a te d   to   t h e   co m p e t i t i ve n e s s 
and the environmental impac ts of agriculture and forestr y (see 
B ox 17).

 As each measure defines the types of projects and beneficiaries 
e l i gi b l e,   t h e   p o s s i b i l i t i e s   fo r   L AG s   to   d e ve l o p   i n n ov a t i ve   a n d 
mul t ise c toral   so l ut ion s  s pec ific  to  th e   local  a rea   are   re duce d. 
The nat ure  o f t he p rojec ts  to be  im pl em ented  is  si mi lar  for  all 
L A G s   i n   e a c h   M e m b e r   S t a t e   a n d   i s   a l s o   s i m i l a r   t o   t h e   m a i n-
s t r e a m ,   a s   i n   m o s t   c a s e s ,   t h e   r u r a l   d e v e l o p m e n t   p r o g r a m m e 
m e a s u re s   a re   p r i m a r i l y   i m p l e m e nte d   by   t ra d i t i o n a l   to p - d ow n 
appro ac he s.

28  The Axis 4 implementation 
guidelines issued by the 

Commission state that it is 

important that operations not 

corresponding to the rural 

development programme measures 

can be supported in order to 

maintain the innovative nature of 

Leader.

29  The LAGs in Ireland, Portugal 
and Poland were limited to 

implementing the measures 

of Axis 3 (plus a ‘small projects’ 

measure in Poland). The LAGs 

in Greece could additionally 

implement one measure from 

Axis 1. The LAGs in Aragón 

and Tuscany could implement 

two Axis 1 measures. LAGs in 

Castilla-La Mancha and Hungary 

could implement all RDP measures.

B oX   1 7

l aG   I N   P o rT U Ga l :  T H E   M Ea sUrEs   lI M I T E D  T H E   l aG ’ s   aB IlI T y  To 
aD DrEs s   T H E   N E E Ds   o f   T H E   loC a l   aGrI C Ul T Ur a l   sE C T o r s

The LAG’s strategy set the objective of combating the rural exodus and the abandonment of traditional 
farming but could only use the measures of Axis 3 of the rural development programme to achieve this. 
This restricted the possibilities to develop local solutions to improve the competitiveness of the olive and 
wine sectors, despite their importance for the local rural economy. Environmental measures to tackle bio-
diversity and climate change issues in the local agricultural sector were excluded from the scope of Leader 
programmes, as were forestry measures.

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87.  

88.  

89.  

s e L e c t i o n   o f   L a g s   t o  
2007–13  p e r i o d

i m p L e m e n t   L e a d e r  

i n   t h e  

 To ensure that Leader is likely to be effective and achieve added 
value, M ember States should only selec t LAGs that are compe -
tent  and have hig h- qu alit y  strategie s.

30  The exception was Tuscany, which 
did not allocate scores.

M emb e r States s el ec ted LAG s wi th  weak   st rate gi es

 In all the Member States audited, the process of selec ting LAGs 
was only weak ly, or not at all competitive, despite the require -
ment  o f t he  re g ul at ion  that it  s h ou ld be  so.

 M ost  m ana ging  au thor it ies  ass es se d an d scored  t h e propose d 
L AG   s t rate gi e s   a g a i n s t   re l e va nt   c r i te r i a   a n d   s e l e c te d   a l l   L AG s 
t h at   a c h i e ve d   a   m i n i m u m   s co re   ( t y p i c a l l y   o f   5 0   % ) 3 0.   Al l   m a n -
aging   aut ho r ities  in  the  sample   accepte d  ever y  L AG   th at   sub -
mitted a valid application (with a handful of exceptions where 
th ere  were  t wo   ap p lications   for   th e  sam e   are a) .   B y  def i ni ti on , 
th e L AGs w ith l ow  s co res were  well  be low  w h at  t h e man agi n g 
author ities considered to be the possible level of competence 
and   qu alit y  of   st rategy  t hat  LAGs   co uld  ac hi eve.  I n  on e   of   th e 
Fren ch regio ns, fo r examp l e,  the  ma naging  aut ho r it y  s ele c te d 
L AG s   e ve n   t h o u g h   t h e i r   a p p l i c at i o n   wa s   a s s e s s e d   a s   b e i n g   o f 
insuff icient q ual it y  (s ee B ox 18) .

B oX   1 8

s ElE C T IoN   o f   l aG s   By  T H E   M aNa G I N G   aU T Ho rI T y   I N   fr aN C E

According to the terms of the call for applications, the selection committee would select between 10 and 
12 LAGs, each with an average financial allocation of 1,5 million euro. Eighteen applications were received, 
of which the managing authority classed two as good quality, eight as intermediate quality and eight as 
insufficient quality. All 18 LAGs were selected and the average financial allocation reduced in consequence 
to 1,1 million euro.

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90.  

 I n p ar t icul ar, th e au dit fou nd th at  L AG s h ad  poor ly  deve lope d 
A x i s   4   s t rate gi e s,   w i t h   n o n - s p e c i f i c   o b j e c t i ve s,   a   l a c k   o f   c l e a r 
i n t e r v e n t i o n   l o g i c ,   a n d   p o o r   o r   n o n - e x i s t e n t   p r o v i s i o n   f o r 
m o n i t o r i n g   a n d   e v a l u a t i o n .   Fo l l o w i n g   t h e   a s s e s s m e n t   o f   t h e 
LAG  st rategie s,   few  M emb er  State s  req ui re d  i mprove me nt s   to 
the  weak ne ss es ident ified.  As  a cons e quen ce,  L AG s have be en 
a w a rd e d   s u b s t a n t i a l   s u m s   f ro m   t h e   E U   b u d g e t   t o   i m p l e m e n t 
wea k s trate gie s fo r a s even-year  pe r iod.

c o m m i s s i o n   a p p r o v a L   o f   t h e   2 0 0 7 – 1 3   r u r a L  
d e v e L o p m e n t  p r o g r a m m e s

91.  

 The  k ey  p o int   at  w h ich   the  Com mi ss ion   coul d  d ete r min e   h ow 
M e m b e r   S t a te s   i m p l e m e n te d   A x i s   4   w a s   w i t h   t h e   a p p rov a l   o f 
the national and regional rural development programmes. The 
Commission should ensure that programmes establish the con-
ditions necessar y and safeguard against the k nown risks to the 
adde d val u e o f the Leader  ap proa c h.

The  Co mmissio n was  undeman din g  in approvin g t he  r ural de -
velop me nt  programmes

92.  

 Ru ral   de vel o pme nt   p rogrammes   are   hi g h- le ve l  d oc ume nts,  of 
whic h  Axis  4   is  a  s mall   p ar t.  M os t  conta in ed   fe w  con crete   d e -
t a i l s   a b o u t   h ow   t h e   Le a d e r   a p p ro a c h   wo u l d   b e   i m p l e m e nte d. 
Member States developed many of the arrangements for Leader 
on l y af ter the  programmes  had be e n  approve d.

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93.  

 The Com mis sio n was  undemand in g  i n  approv i ng  t he  r ura l d e -
ve l o p m e nt   p ro gra m m e s,   w h i c h   l e d   to   t h e   s i t u at i o n   d e s c r i b e d 
in paragraphs 80 to 90. The Commission accepted programmes 
t h a t   d i d   n o t   p r o v i d e   f o r   c o m p e t i t i v e   s e l e c t i o n   o f   L A G s   ( d e -
spite the requirement in the regulation); that restricted LAGs to 
imp l em ent ing natio nal l y- def ine d me asures  ( de s pite th e  Com-
m i s s i o n’s   g u i d a n ce   t h at   L AG s   s h o u l d   n o t   fo l l ow   a   f i xe d   s e t   o f 
measures); that had no specific plans for achieving innovation 
o r   i n t e r a c t i o n   b e t w e e n   s e c t o r s   ( d e s p i t e   i n s t r u c t i o n s   f o r   t h e 
Commission assessments that innovation should be a priorit y); 
n o r   fo r   m o n i to r i n g   a n d   e va l u at i o n   ( d e s p i te   t h e   Le a d e r +   m i d -
t e r m   e v a l u a t i o n   c o n c l u s i o n s   t h a t   t h e s e   h a ve   t o   b e   b u i l t   i n t o 
pro gra mmes   f ro m  th e  ou ts et).  The   Co mm is s ion   d i d  n ot   a ss es s 
key elements for the added value of the Leader approach, such 
as M em be r State requirements  fo r  th e com pos i ti on  a n d open-
nes s o f L AGs.

TH E   CoM M Is sIoN   aN D   ME M B Er   s TaT Es ’ 
MoN I T o rI N G   aN D   E Va lUaT IoN

TH E   CoM M Is sIoN   aN D   ME M B Er   s TaT Es   C aN No T 
D E MoNsTr a T E  T H E   aD D E D  Va lU E   aC H I E V E D   f r oM  
I M PlE M E N T I N G  T H E   l EaD Er   aP Pr o a C H   aN D   Ha V E 
No T  y E T   E Va lUaT E D  T H E   aD D I T IoNa l   Co sT s   aN D  
rIsKs  

I N V o lV E D

m o n i t o r i n g   a n d   e v a L u a t i o n   o f   t h e   e f f e c t i v e n e s s   o f  
t h e  L e a d e r  a p p r o a c h

94.  

 Th e   Co m m i s s i o n   a n d   M e m b e r   S t a te s   s h o u l d   u s e   t h e   m a n a g e -
ment   s ystems,  the  c hec ks   o n  L AGs,  m on itor i n g  in d ic ator s  and 
annual repor ts to monitor the implementation, results and im-
pac ts of the Leader programmes. This should be done not only 
to be able to take timely cor rec tive ac tion, but also to provide 
s u f f i c i e nt,   re l i a b l e   a n d   re l e va nt   e v i d e n ce   fo r   e va l u at i o n s   a n d 
to give assu ra nce on the ef fec tiven es s an d  adde d va lue  of  th e 
Leade r app ro ac h.

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T h e   L A G s ,   M e m b e r   S t a t e s   a n d   C o m m i s s i o n   m o n i t o r e d  
th e im pl eme ntation of Leader program me s

95.  

 T h e r e   w a s   e x t e n s i v e   a c t i v i t y   i n   m o n i t o r i n g   t h e   i m p l e m e n t a-
t i o n   o f   Le a d e r +   p ro gra m m e s.   L AG s   a n d   m a n a gi n g   a u t h o r i t i e s 
r e c o r d e d   d e t a i l s   o f   t h e   g r a n t s   a w a r d e d   a n d   p a y m e n t s   m a d e 
pro jec t by p ro jec t.  M anaging auth or i ti es  requi red  t h e L AGs  to 
p re p a re   a n n u a l   i m p l e m e n t a t i o n   re p o r t s   d e s c r i b i n g   t h e   L AG s’ 
a c t i v i t i e s   a n d   co m p i l e d   d at a   fo r   m o n i to r i n g   i n d i c ato r s.  Th e s e 
m a i n l y   c o n c e r n e d   t h e   n u m b e r s   o f   p r o j e c t s   a n d   a m o u n t s   o f 
grant s  c la ssified  acco rding  to  t ype   of   be n ef ic i ar y  an d  f ie ld   of 
e x p e n d i t u r e.   M a n a g i n g   a u t h o r i t i e s   s u b m i t t e d   a n n u a l   i m p l e -
ment at io n rep o r t s  to  t he Co mmi ss i on .

96.  

 Al l   m a n a gi n g   a u t h o r i t i e s   p ro d u ce d   a  ‘m i d - te r m’  e va l u at i o n   o f 
Le a d e r +   i n   2 0 0 3   w i t h   a n   u p d ate   i n   2 0 0 5 .  Th e   Co m m i s s i o n   e n -
gag ed a co nt rac to r to make a sy nt he si s  repo r t.

97.  

98.  

… b u t   t h e r e   i s   l i t t l e   e v i d e n c e   o n   t h e   e f fe c t i v e n e s s   o f   Le a d e r 
programmes in achieving rural development objec tives or the 
adde d val u e o f the Leader  ap proa c h

 D e s p i t e   a l l   t h i s   a c t i v i t y,   a s   L AG s   d i d   n o t   a s s e s s   o r   r e p o r t   o n 
a c h i e ve m e n t   o f   t h e   l o c a l   s t r a t e g y   o b j e c t i ve s,   t h e re   i s   a n   a b -
s e n c e   o f   e v i d e n c e   o n   t h e   r e s u l t s   a n d   r u r a l   d e v e l o p m e n t   i m-
p a c t s   o f   t h e   Le a d e r   e x p e n d i t u re.   N o   i n fo r m a t i o n   i s   a v a i l a b l e 
o n   w h e t h e r   ( o r   to   w h a t   e x t e n t )   t h e   Le a d e r   p ro gr a m m e s   h ave 
reduced the rural exodus from the areas concer ned; increased 
o p p o r t u n i t i e s   f o r   y o u n g   p e o p l e ;   d i v e r s i f i e d   t h e   r u r a l   e c o n-
omies, etc.

 One par tial exception concerned the jobs created or safeguard-
ed by t he Leader p ro jec t s,  w hich t he  Com mi ss ion  en courag e d 
M ember States to monitor for all Struc tural Fund programmes. 
However, the Cour t found the definitions used to be inconsist-
e n t   a n d   t h e   d a t a   —   w h i c h   i n   m o s t   c a s e s   w a s   n o t   c h e c k e d   b y 
th e man aging au thor it ies  — was  n ot  reli able  or  cred ible.

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99.  

100.  

101.  

102.  

 The 2003 evaluations were before most LAGs had star ted imple -
m e nt i n g   t h e   Le a d e r   p ro gra m m e s   a n d   t h e   u p d ate s   we re   m a d e 
before significant expenditure had been incurred. Many evalu-
atio n  qu est ion s  were  not   ans we re d,   or   rel i ed   on   th e   opin ion s 
of t ho se w ho b enef ited from  th e pro gramm e.

 Th e   a b s e n ce   ( o r   u n re l i a b i l i t y )   o f   d at a   m a k e s   i t   d i f f i c u l t   to   e s-
t a b l i s h   t h e   e f fe c t i ve n e s s   o f   t h e   Le a d e r   p ro g r a m m e s   i n   d e l i v -
e r i n g   r u r a l   d e ve l o p m e n t   o u t c o m e s,   e i t h e r   i n   a b s o l u t e   t e r m s, 
o r   i n   re l a t i o n   t o   t h e   e f fe c t i ve n e s s   o f   o t h e r   d e l i ve r y   m e t h o d s 
(not abl y,  the m ainstream p ro gram me s ).

 The potential added value of the Leader approach is not solely 
in the results and impac ts of the physical outputs (the projec ts 
implemented with the Leader grants). The communit y involve -
ment achieved through the bottom-up approach can also lead 
t o   l e s s   t a n g i b l e   i m p a c t s,   s u c h   a s  ‘c a p a c i t y - b u i l d i n g’  a n d  ‘e m-
p o w e r i n g   t h e   l o c a l   p o p u l a t i o n’.   T h e   s t r a t e g i c   g u i d e l i n e s   f o r 
A x i s   4   co n s i d e r   t h a t   Le a d e r   s h o u l d  ‘p l ay   a n   i m p o r t a n t   ro l e   i n 
th e ho r izont al p r ior it y of imp rov i ng  g over n ance’.

 The potential for the Leader approach to achieve such impac ts 
i s   i n d i c a t e d   by   e x a m p l e s   i n   t h e   co n t a c t   p o i n t ’s   b e s t - p r a c t i ce 
p u b l i c a t i o n s ,   t h e   e v a l u a t i o n s   a n d   v a r i o u s   s t u d i e s .   H o w e v e r, 
t h e re   h a s   b e e n   n o   s ys t e m a t i c   m o n i to r i n g   o r   re p o r t i n g   o f   t h e 
L A G s ’  a c h i e v e m e n t s   i n   t h e s e   a r e a s ,   s o   t h e   e x a m p l e s   r e m a i n 
isolated cases. In the absence of reliable and relevant evidence, 
eva lu at io ns  have  no t b een ab le to de mon s trate  th e  fre que nc y 
an d ex tent  of s uc h imp ac ts.

m o n i t o r i n g  a n d  e v a L u a t i o n  o f  t h e  c o s t s  a n d  r i s k s

103.  

 T h e   m o n i t o r i n g   a n d   e v a l u a t i o n   s h o u l d   a l s o   p r o v i d e   r e l i a b l e 
evide nce and asses s ments of  th e cost s an d  r is k s of  th e  Le ade r 
appro ac h.

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T h e   C o m m i s s i o n   a n d   M e m b e r   S t a t e s   h a v e   n o t   m o n i t o r e d   o r 
eval uated t he additio nal  cos ts  and  r is k s  invo lve d

 I n respec t to the weak nesses identified in the Cour t ’s 2000 An -
nua l  R ep or t,  t he   Co m mi s s i o n  replied  that  most   cor responded 
to   r i s k s   t h a t   a re   i n h e re n t   i n   a   d e ce n t r a l i s e d   p ro gr a m m e   s u c h 
a s   L e a d e r   a n d   t h a t  ‘ t h e   C o m m i s s i o n   a n d   M e m b e r   S t a t e s   a r e 
a w a r e   o f   t h e s e   r i s k s   w h e n   m o n i t o r i n g   t h e   p r o g r a m m e s   a n d 
c h e c k i n g   t h a t   t h e i r   i m p l e m e n t a t i o n   f o l l o w s   t h e   p r i n c i p l e   o f 
sou nd f inanc ial  manag ement ’.

31  The effectiveness of such 
recommendations is brought 

into question by the results of 

the Court’s observations in these 

Member States, which show that the 

weaknesses continued to exist in 

2009.

32  It should be noted that this is not 
an objective of the Commission’s 

checks.

 Th e   Co m m i s s i o n   c h e c k s   co m p l i a n ce   w i t h   t h e   re g u l at i o n s   a n d 
c a n   p r o p o s e   f i n a n c i a l   c o r r e c t i o n s .   C h e c k s   m a d e   d u r i n g   t h e 
L e a d e r +   p e r i o d   i n c l u d e d   t h e   p r o g r a m m e s   o f   P o r t u g a l   a n d 
France in 2005. The Commission ser vices found that there were 
n o   f o r m a l   p r o j e c t   s e l e c t i o n   c r i t e r i a ;   t h a t   c o n f l i c t   o f   i n t e r e s t 
pro ced ures were inadeq uate and L AGs  took  de c is ion s wi th out 
a  ‘d o u b l e   q u o r u m’ ;   a n d   t h at   L AG s   d i d   n o t   h ave   p ro ce d u re s   to 
check the reasonableness of proposed projec t costs. The Com-
mission ser vices made recommendations to the Member States 
c o n c e r n e d   b u t   d i d   n o t   c o n s i d e r   i t   a p p ro p r i a t e   t o   p ro p o s e   f i-
n a n c i a l   c o r r e c t i o n s 3 1.  T h e   C o m m i s s i o n   s e r v i c e s   a l s o   c h e c k e d 
t h e   c o m p l i a n c e   o f   r e t r o s p e c t i v e   g r a n t s   a n d   g r a n t   r a t e s   w i t h 
the regulations, but did not raise the questions of deadweight 
or  e ffic ienc y.

 wh i l e   t h e   Co m m i s s i o n’s   c h e c k s   co n f i r m e d   t h e   r i s k s   i d e nt i f i e d 
in the Annual Repor t 2000 (and in this audit), they do not form 
a basis for establishing the ex tent and impac t of those r isks in 
the  M e mb er States co ncer ned or   EU -w id e 32.

 M ember States’ inspec tions of the LAG operations (which cov -
e re d   a t   l e a s t   5   %   o f   t h e   e x p e n d i t u re   i n   Le a d e r + )   p rov i d e d   a n 
oppor tunity to check and repor t on the incidence of the risks to 
sou nd f in anc ial manag ement.  Howeve r,  wi th  a  few exce pti ons 
i n   ce r t a i n   M e m b e r   St ate s,   t h e y   h ave   n o t   cove re d   t h e   f a i r n e s s 
a n d   t r a n s p a r e n c y   o f   t h e   L AG s’  p r o j e c t   s e l e c t i o n   p r o c e d u r e s , 
s o u n d n e s s   a n d   d o c u m e n t a t i o n   o f   t h e   a s s e s s m e n t   o f   p r o j e c t 
pro po s als,  vo ting  records,  o r the  cor re c t ope rati on  o f con f li c t 
of intere st p o licies.

104.  

105.  

106.  

107.  

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108.  

109.  

110.  

 Member States have not used their management systems or the 
L AG s’  a n n u a l   i m p l e m e nt at i o n   re p o r t s   to   m o n i to r   t h e   f a i r n e s s 
a n d   t r a n s p a r e n c y   o f   t h e   L AG s’  d e c i s i o n - m a k i n g   p r o c e s s ,   t h e 
propor tion of grants awarded to LAGs’ members, the efficienc y 
of t he grants  award ed or  t he eff ic i en c y  of  th e  L AG s’ proce ss es 
an d o p erat in g co sts.  I n France,  th e  ma nagi n g  auth or it y  m oni-
tored LAGs’ ac tivities through obser ving LAG meetings but ap -
parently condoned prac tices such as LAG members presenting 
their own projec ts, mak ing retrospective grants to projects and 
rais ing  grant  rates to  s p end u p th e bu dge t  ( s ee paragra ph 5 5 , 
for examp le ).

33  For example, a survey of project 
promoters by the LAG in France 

(Pays de la Loire) found that 71 % 

would have undertaken the project 

without the Leader grant.

34  The Commission has asked the 
contractor for the Leader+ final 

evaluation to assess the incidence 

of deadweight, but there was no 

monitoring or data collection during 

the Leader+ period for this.

 where individual LAGs have questioned projec t promoters, the 
i n fo r m at i o n   ava i l a b l e   i n d i c ate s   t h at   d e a d we i g ht   i s   a n   i m p o r -
t a n t   r i s k 3 3.   T h e   E U - l e v e l   e v a l u a t i o n s   g a v e   n o   i n f o r m a t i o n   o n 
dea dweig ht o r th e ex tent o f ret ros pec t ive grant s 34.

 Similarly, for the fairness and transparenc y of LAG procedures, 
the evaluations indicate that problems exist with the objec tivi-
ty of project selection, for example, but provide no information 
on  the  ex tent o r imp ac t o f su c h  we ak n es se s  (s e e B ox 1 9).

B oX   1 9

EX Tr a C T   f r oM  T H E   s y N T H EsIs   o f   T H E   l EaD Er +   M I D-T ErM  
E Va lUaT IoN   rE Po rT s

‘Unbalanced partnership or unbalanced power relations in the LAG can lead to an inappropriate set of 
projects selected, often at the advantage of the institution belonging to the public sector. The composition 
of LAGs is often unbalanced and the institutional sector dominates.’

‘The information in the [evaluation] reports and in the case studies has tended to concentrate on issues 
such as bureaucracy, relationships between managing authorities and LAGs, financing, and insufficient 
autonomy at LAG level. More fundamental management issues such as structures, management systems, 
planning and control at LAG level were not highlighted in the reports. Responses to the question also do 
not refer at all to the role of the [decision-making committees] in programme management.’

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111.  

 A s   a l r e a d y   i n d i c a t e d   i n   p a r a g r a p h s   6 4   t o   7 1 ,   i n fo r m a t i o n   o n 
Le a d e r   o p e ra t i n g   co s t s   w a s   n o t   co m p a r a b l e,   n o t   re l i a b l e   a n d 
above  all   no t  comp l ete  as  many   f un c ti on s  we re   per for me d  by 
the  managing  a uth or it ies  in some  M e mbe r  State s.  Th e e valua-
tions rep or ted o n t he ‘excess ive burea ucrac y ’ of  Le ade r + 35 but 
h a v e   n o t   a s s e s s e d   t h e   c o s t s.   C o n s e q u e n t l y,   t h e   e f f i c i e n c y   o f 
th e Leade r ap p roac h cannot  b e  de te r mi ne d.

m o n i t o r i n g  a n d  e v a L u a t i o n  i n  t h e 2007–13  p e r i o d

112.  

 Th e   Co m m i s s i o n   a n d   M e m b e r   St ate s   s h o u l d   l e a r n   t h e   l e s s o n s 
from the three previous Leader programming periods to ensure 
t h a t   e f f i c i e nt   a n d   e f fe c t i ve   m o n i to r i n g   a n d   e va l u at i o n   o f   t h e 
Lea der a pp ro ac h is  in p l ace  for  th e  2 0 0 7 –1 3  per i od. 

113.  

I mpl em ent at io n of  Axis 4  has st ar te d w it hout  k e y  ele me nt s 
of the  mo nitor in g and evalu ation  s yste ms  bei n g  in  place

 T h e   L e a d e r +   m i d - t e r m   e v a l u a t i o n   s y n t h e s i s   r e p o r t   s t r o n g l y 
recommended that monitor ing and evaluation systems should 
b e   i m p ro ve d   a n d   n e e d e d   t o   b e   i n   p l a c e   f ro m   t h e   s t a r t   o f   t h e 
2007–13 programming period 36. The Commission established a 
Common Monitoring and Evaluation Framework (CMEF) for the 
rural development programmes. This set some specific evalua-
tion questions on Leader added value, improvement in govern-
ance and effec tiveness, but reduced the monitoring indicators 
specific to Leader to the number of LAGs and the population in 
Leader areas, which the Commission considers as the baseline 
i n d i c a t o r   fo r   m e a s u r i n g   t h e   g o ve r n a n c e   o b j e c t i ve.  T h e   C M E F 
allowed  the  man aging   aut hor it ie s  to   de ve lop  ad dit io nal  i ndi-
c a t o r s,   b u t   n o n e   o f   t h e   a u d i t e d   m a n a g i n g   a u t h o r i t i e s   d i d   s o 
fo r   Le a d e r.   M o re ove r,   n o n e   o f   t h e   a u d i te d   L AG s   o r   m a n a gi n g 
autho r it ie s had  m ad e ar rang em e nt s for  coll ec t in g  and  re po r t-
i n g   i n fo r m a t i o n   re l a t i ve   to   t h e   co s t s,   r i s k s,   e f fe c t i ve n e s s   a n d 
add ed  val ue o f the Leader ap proa c h.

35  Leader+ evaluation synthesis: 
‘the mid-term evaluation reports 

repeatedly list:  

(i) excessive bureaucracy;  

(ii) difficult relationships between 

managing and other involved 

authorities on one side and LAGs 

and project promoters on the other;  

(iii) problems with raising 

 co-funding; (iv) delays in financing; 

and (v) insufficient autonomy of 

the LAG. The consequence of these 

deficiencies has been a loss of 

management efficiency. Excessive 

bureaucracy leading to delays in 

financing projects is viewed as 

the main management issue that 

hinders impact and in fact detracts 

from some of the other attractive 

design features of Leader+’.

36  ‘[In Leader+,] programme 
evaluation was not integrated at 

the design stage and essential 

evaluation features e.g. baseline 

data, were not sufficiently 

considered’. Recommendation: 

‘The accompaniment of local action 

groups with a mix of external 

evaluation and assisted self-

evaluation should be designed and 

put down in the programme’.

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114.  

 A t   t h e   e n d   o f   2 0 0 9 ,   t h e   C o m m i s s i o n ,   t h r o u g h   t h e   E u r o p e a n 
Evaluation Network for Rural Development, established a them-
a t i c   wo r k i n g   gro u p   o n   Le a d e r   to   co n s i d e r   t h e   d i f f i c u l t i e s   e n-
countered by the M ember States, including concern that CMEF 
indicators and economic measurement will not adequately cap-
t u re   Le a d e r   e f fe c t s ;   c o n s i d e r a b l e   m e t h o d o l o g i c a l   c h a l l e n g e s 
owing to the local scale of Leader ; major methodological chal-
l e n g e s   i n   e v a l u a t i n g   g o v e r n a n c e,   p a r t i c i p a t i o n   a n d   c a p a c i t y 
i n   r u ra l   co m m u n i t i e s   a n d   p ro b l e m s   to   p rov i d e   h a rd   s t at i s t i c s 
fo r   e va l u at i n g   t h e   Le a d e r   b e n e f i t s.   I n   m i d - 2 0 1 0   t h e   gro u p   i s-
sued a draft work ing paper on capturing the impac ts of Leader. 
H o we v e r,   t h e   w o r k   o f   t h i s   g ro u p   c o m e s   t o o   l a t e   fo r   t h e   m i d -
t e r m   e v a l u a t i o n s   ( w h i c h   h a v e   t o   b e   c o m p l e t e d   i n   2 0 1 0 )   a n d 
th e  p o ssib ilit ie s  for  eval uation  of   Ax is   4   wi ll  be   l i mi te d  as   t h e 
relevant infor mation is not being collec ted or repor ted at LAG 
leve l  (see  paragrap h 11 3) .

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CONCLUSIONS AND 
RECOMMENDATIONS

55

115.  

116.  

117.  

l aG s   Ha V E   I M PlE M E N T E D  T H E   l EaD Er 
aP Pr o a C H  I N  ways  T Ha T  lI M I T  T H E  Po T E N T Ia l 
f o r   aD D E D  Va lU E   I N  T ErMs   o f   T H E   ‘ l EaD Er 
fEa T UrEs ’,  a lT HoU G H  T H E   CoUrT   f oU N D  
E X aM PlEs   o f   Go oD   Pr a C T I C E

 T h e   L AG s   a u d i t e d   i m p l e m e n t e d   a ro u n d   1   0 0 0   p ro j e c t s   i n   t h e 
L e a d e r +   p e r i o d   t h a t   w e r e   o f   b e n e f i t   t o   t h e   l o c a l   b u s i n e s s e s 
a n d   c o m m u n i t i e s   c o n c e r n e d .   B u t   Le a d e r   i s   a b o u t   m o r e   t h a n 
this : it  s ho u ld  ac hieve added value  com pare d wi th  trad it ion al 
programmes through following a specific approach. To the ex -
tent that the key features of the Leader approach are not fully 
followed, the potential added value of the approach cannot be 
ach ieved.

 The bottom-up approach was limited in the LAGs that gave the 
major it y of the grants to their own member organisations; the 
p o t e n t i a l   a d d e d   v a l u e   o f   a   p a r t n e r s h i p   w a s   n o t   a c h i e v e d   i n 
L AG s   w h e re   t h e   d e c i s i o n - m a k i n g   wa s   d o m i n ate d   by   t h e   l o c a l 
authorities; few LAGs could demonstrate innovation or interac-
t i o n   b e t we e n   d i f fe re nt   s e c to r s   i n   t h e i r   s t rate gi e s   o r   p ro j e c t s. 
ye t   t h e r e   w e r e   s o m e   e x a m p l e s   o f   L A G s   t h a t   r e a l l y   i n v o l v e d 
the local communit y and of initiating successful local projec ts 
th ro ug h t heir ‘an imatio n’ ac t ivit ie s.

 Local strategies should be at the hear t of the Leader approach, 
g i v i n g   t h e   p a r t n e r s h i p s   t h e i r   ra i s o n   d’ ê t r e  a n d   p r o m i s i n g   a n 
a d d e d   v a l u e   t h r o u g h   l o c a l   s o l u t i o n s   t a i l o r e d   t o   a c h i e v e   t h e 
local  rural  devel op ment ob jec tives. I n prac t ice, t he  s trategi e s 
we re   a l m o s t   i r re l e v a n t   a n d   s e r ve d   a s   l i t t l e   m o re   t h a n   a n   a p -
p l i c at i o n   to   t h e   m a n a gi n g   a u t h o r i t y   fo r   f u n d i n g.   N o n e   o f   t h e 
LAGs monitored or repor ted on their per formance in achieving 
th eir s trategy  ob jec tives.

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118.  

119.  

120.  

l aG s   D I D   No T   Ha V E   D U E   rE Ga rD  To  T H E   N E E D 
f o r   faIr   aN D  Tr aNsP a rE N T   Pr oC E D UrEs   o r 
Ef fI C I E N C y

 LAGs   have  no t  tak en  s uffic iently  s e r iousl y  th e  ne e d  for   t ran s-
p a r e n c y,   f o r   d o c u m e n t a t i o n   o f   t h e   p r o j e c t   a s s e s s m e n t   a n d 
s e l e c t i o n   d e c i s i o n s   a n d   f o r   p r o c e d u r e s   t o   a v o i d   a l l   r i s k s   o f 
d i re c t   o r   i n d i re c t   c o n f l i c t   o f   i n t e re s t .  Th i s   n o t   o n l y   i n c re a s e s 
the risks that grant decisions will be made without due regard 
to eff icienc y, it al so  c reate s a reputati ona l r i sk  for  th e E U.  Th e 
practices obser ved in some LAGs, such as grant decisions being 
m a d e   by   a   h a n d f u l   o f   p e o p l e   a n d   to   t h e i r   ow n   o rg a n i s at i o n s, 
a r e   l i k e l y   t o   b e   t o   t h e   d e t r i m e n t   o f   l o c a l   g o v e r n a n c e   r a t h e r 
than  enhance  it.

 L A G s   h a v e   n o t   t a k e n   a c c o u n t   o f   e f f i c i e n c y,   p a r t i c u l a r l y   i n 
awa rd i n g   gra n t s   fo r   p ro j e c t s   t h at   we re   a l re a d y   u n d e r   way,   o r 
 even  compl eted,  before the grant  decis ion was made. I n some 
cases, their objec tive appears to have been to spend the maxi -
m u m   a m o u n t   p o s s i b l e ,   r a t h e r   t h a n   t o   a c h i e v e   t h e   m a x i m u m 
res ul t s p o ssibl e.

 Th e   co s t s   o f   i m p l e m e nt i n g   Le a d e r   a re   s u b s t a nt i a l,   d u e   to   t h e 
a d d i t i o n a l   i m p l e m e n t a t i o n   l a y e r :   u p   t o   a   t h i r d   o f   t h e   L A G ’s 
b u d g e t   i n   a d d i t i o n   t o   t h e   m a n a g i n g   a u t h o r i t i e s   a n d   p a y i n g 
a g e n c i e s’  co s t s   o f   p ro ce s s i n g,   m o n i to r i n g   a n d   co nt ro l.   I n f l ex-
i b l e   p ro ce d u re s   —   e ve n   fo r   ve r y   s m a l l   p ro j e c t s   —   a n d   d e l ays 
limite d  efficie nc y,   al t houg h,   to  a  larg e  de gree,  t he se   re sulte d 
from  the  M e mb er States’ requireme nts.

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TH E   CoM M Is sIoN   aN D   ME M B Er   s TaT Es  wErE  
No T   sUf fI C I E N Tly   D E M aN D I N G   aN D   sHa rE   s oM E  
rEsPoNsI B IlI T
T H E   Po T E N T Ia l   aD D E D  Va lU E   o f  T H E   l EaD Er 
aP Pr o a C H . TH Ey   Ha V E   No T  TaK E N   sUf fI C I E N T  
aC T IoN  To   lI M I T  T H E   Co sT s   aN D   rIsKs

y  wI T H  T H E   l aG s   f o r   lI M I T I N G  

121.  

 The LAGs bear the main responsibility for achieving the Leader 
added value and sound financial management, but the risks are 
well k nown. The Commission and Member States share respon-
s i b i l i t y   f o r   s u p e r v i s i n g   t h e   L AG s’  p e r f o r m a n c e   a n d   e n s u r i n g 
that they follow the Leader approach and consistently achieve 
t h e   h i g h e s t   s t a n d a r d s   o f   s o u n d   f i n a n c i a l   m a n a g e m e n t .   Po o r 
per formance in these respec ts should not be tolerated, even in 
the   M e mb er  St ates  imp l ementin g   Lead er   for   th e   f i r st  t im e,  as 
the lessons of the previous programming per iods should have 
bee n l ear ned.

122.  

 However, 10 years after the Cour t ’s previous audit of Leader, the 
s a m e   s e r i o u s   we a k n e s s e s   p e r s i s t.  Th e   Co m m i s s i o n   re s p o n d e d 
to the obser vations in the Cour t ’s 2000 Annual Repor t with ‘en-
couragem ent’, gu idance and  recomm en dat ion s  to th e M embe r 
States. This has not  p roved effec ti ve.

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rE C oM MEN D aT IoN   1

In view of the persistent weak nesses, the Commission should 
en su re  that  th e  l egis l at ion   provi de s  s uf f ic ie nt  c lar it y  on   th e 
stand ards req uired in t he s p ec ifi c  cas e of  Lea d er. A fe w si m-
ple  req uireme nts  at  EU l evel  may  re place  t he  n ee d fo r dive r-
gent operating rules at programme level, simplify procedures, 
i m p rove   co n s i s te n c y   a n d   p rov i d e   c l e a r   co nt ro l   s t a n d a rd s   i n 
th e fo l lowing areas :

(a)  e x c l u s i o n   o f   p r o j e c t s   s t a r t e d   b e f o r e   a   g r a n t   d e c i s i o n 
h a s   b e e n   m a d e,   to   e l i m i n ate   a   m a j o r   r i s k   o f   i n e f f i c i e n c y 
(de adweig ht );

(b)  LAGs’ selection of projects to be based on documented as-
sessments that demonstrate the soundness and fairness of 
the decision in ter ms of consistent and relevant cr iter ia;

(c)  ru le s  to   ensure  t hat   th e  par t ners h ips   are   n ot   do mi nate d 
by  th e l o cal au th or ities at proje c t s ele c t ion  me e ti ng s.

In addition, Member states should ensure that effec tive pro -
cedures are in place concerning the weak nesses identified in 
t h i s   r e p o r t ,   a n d   t h a t   t h e   c o r r e c t   o p e r a t i o n   o f   t h e s e   p r o c e -
dures  is  sup er vis ed.

123.    I n   p a r t i c u l a r,   t h e   Co m m i s s i o n   a n d   M e m b e r   St ate s   h ave   to l e r -
a t e d   t h e   s i t u a t i o n   w h e r e   L AG s   d o   n o t   h a v e   e f f e c t i v e   p r o c e -
dures to  avo id confl ic ts of intere st.  Th e we ak n es se s obse r ve d 
hig hl ig ht   the  r is k  that  the  LAG  me m ber s   m ay   h ave  direc tl y  or 
indirec tly influenced the decisions in a way that resulted in an 
inef fe c tive o r inefficient u se of  t he  E U budg e t.

rE C oM MEN D aT IoN   2

The financial regulation prohibits any ac tion that may result 
in a conflic t of interests. I n view of this, the Commission and 
M e mb e r  state s  s ho ul d  ensu re  th at  effec tive  s afe guards  a re 
in  pl ace,  and  ch eck  t hat  t hey  ope rate  cor re c tly.  M embe r s  of 
the LAG’s projec t assessment or decision-mak ing committees 
w i t h   a ny   p e r s o n a l,   p o l i t i c a l,   p ro fe s s i o n a l   o r   b u s i n e s s   i n t e r-
e s t   i n   a   p ro j e c t   p ro p o s a l   s h o u l d   m a k e   a   w r i t te n   d e c l a rat i o n 
o f   t h e   i nte re s t .  Th e y   s h o u l d   b e   a b s e nt   f ro m   a ny   d i s c u s s i o n , 
assessment or decision on the projec t and the matter should 
be referred to the managing authority in accordance with the 
fin ancial  regu l atio n.

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124.  

 Fundamental to Leader is the bottom-up identification of local 
s o l u t i o n s   t o   l o c a l   p ro b l e m s,   ye t   a l l   b u t   o n e   o f   t h e   m a n a g i n g 
aut ho r it ies audited h ave imp osed  a de fac to top - down system 
fo r   t h e   2 0 0 7 – 1 3   p e r i o d .  T h e s e   m a n a g i n g   a u t h o r i t i e s   r e q u i r e 
LAGs to implement the common rural development programme 
m e a s u r e s ,   c o n t r a r y   t o   t h e   C o m m i s s i o n’s   g u i d a n c e .   T h i s   m a y 
make Leader easier to control, but limits the scope for innova-
tive local strategies and hence limits the potential added value 
that  jus tifies t he Leader ap p roac h 37.

37  The importance of this is 
underlined by the definition of 

the Leader approach given in the 

Commission’s fact sheet as ‘a method 

of mobilising and delivering rural 

development in local communities, 

rather than a fixed set of measures 

to be implemented’.

rE C oM MEN D aT IoN   3

T h e   C o m m i s s i o n  s h o u l d   r e v i e w   w i t h   t h e   M e m b e r   s t a t e s 
w h e t h e r   t h e   e x i s t i n g   m e a s u r e s   c o n s t r a i n   t h e   L A G s’  a b i l i t y 
t o   d e s i g n   a n d   i m p l e m e n t   i n n o v a t i v e ,   m u l t i s e c t o r a l ,   l o c a l 
s t r a t e g i e s   t o   a c h i e v e   t h e   o b j e c t i v e s   o f   A xe s   1 – 3   o f   t h e   r u-
ral d evel o pme nt  p o lic y. M e mb er st ates sh ould amend t heir 
r u l e s   a s   n e c e s s a r y   t o   a l l ow   L AG s   t o   d e ve l o p   l o c a l   s o l u t i o n s 
that do not correspond to the rural development programme 
me asu res.

125.  

 I n   s h a re d   m a n a g e m e n t   i t   i s   n o t   t h e   Co m m i s s i o n’s   ro l e   t o   a p -
prove all details of national and regional implementing arrange -
ment s,   bu t  b efo re  having  ap prove d  t h e  2 00 7– 1 3   pro gram me s 
the Commission should have ensured that key elements to the 
s u c c e s s   o f   Le a d e r   ( s e e   b e l o w )   w e r e   i n   p l a c e .   M e m b e r   S t a t e s 
selec ted LAGs with weak strategies. As a result, the EU budget 
i s   b e i n g   i m p l e m e n t e d   i n   t h e   2 0 0 7 – 1 3   p e r i o d   i n   a   w ay   t h a t   i s 
less efficient, less effec tive and with less potential added value 
th an co ul d have  b een ach ieved.

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rE C oM MEN D aT IoN   4

Th e   Co m m i s s i o n   s h o u l d   e n s u re   t h at   M e m b e r   st ate s   re v i e w 
t h e   L A G s ’  2 0 0 7 – 1 3   s t r a t e g i e s   a n d   r e q u i r e   t h e   L A G s   t o   s e t 
m e a s u r a b l e   o b j e c t i ve s,   s p e c i f i c   t o   t h e i r   l o c a l   a re a ,   t h a t   c a n 
be achieved by the Leader programme in the remainder of the 
p e r i o d.  Th e   M e m b e r   st ate s  s h o u l d   t h e n   re q u i re   L AG s   to   a c -
count for achieving their local strategy objec tives, for achiev-
i n g   a d d e d   v a l u e   t h r o u g h   t h e   L e a d e r   a p p r o a c h ,   a n d   f o r   t h e 
efficienc y of the grant expenditure and the operating costs.

M e m b e r   s t a t e s   s h o u l d   f u r t h e r   c o n s i d e r   w h e t h e r   t h i s   i n-
c r e a s e d   a c c o u n t a b i l i t y   f o r   s o u n d   f i n a n c i a l   m a n a g e m e n t 
would allow the existing management, super vision and con-
t ro l   s ys te m s   to   b e   s t re a m l i n e d,   w i t h   l e s s   n e e d   fo r   c h e c k i n g 
com pl iance wit h el igib il it y cond it ion s  for  me as ure s.

rE C oM MEN D aT IoN   5

I n   v i e w   o f   i t s   r e s p o n s i b i l i t y   t o   e n s u r e   t h e   s o u n d   f i n a n c i a l 
management of the EU budget, the Commission should check 
f u t u re   p ro g r a m m e s   i n   s u f f i c i e n t   d e t a i l   fo r   t h e   s p e c i f i c   e l e -
ments that are fundamental to the added value, effec tiveness 
and  eff icienc y of Lead er.

M e m b e r   s t a t e s  s h o u l d   e n s u r e   i n   f u t u r e   t h a t   L A G s   c o r r e c t 
any weak nesses identified in the selec tion process such that 
LAG s have strategies  and imp lem e nt at ion  plans  o f t he  hi gh-
est s t andard.

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TH E   CoM M Is sIoN   aN D   ME M B Er   s TaT Es 
C aN No T   D E MoNsTr a T E  T H E   aD D E D  Va lU E 
aC H I E V E D   f r oM   I M PlE M E N T I N G  T H E   l EaD Er 
aP Pr o a C H   aN D   Ha V E   No T   E Va lUaT E D  T H E 
aD D I T IoNa l   Co sT s   aN D   rIsKs  

I N V o lV E D

126.  

 The EU  b u dg et  contr ib u ted over  2  bill ion  e uro to Le ade r +  an d 
h a s   p r o g r a m m e d   o v e r   5   b i l l i o n   f o r   t h e   2 0 0 7 – 1 3   p e r i o d .   T h e 
Commission has not yet demonstrated the effec tiveness or ef-
ficienc y of the expenditure, the added value achieved through 
following the Leader approach, the ex tent to which the k nown 
r i s k s   h a v e   m a t e r i a l i s e d   o r   t h e   r e a l   c o s t s   o f   i m p l e m e n t a t i o n . 
Member States have not collec ted and validated the necessar y 
information, so there is an insufficient evidence -base for evalu-
a t i o n .  T h i s   a u d i t   h a s   s h o w n   t h a t   t h e   a d d e d   v a l u e   a n d   s o u n d 
financ ial  manag ement  of  Leade r  can n ot be  t ak e n  for  granted.

rE C oM MEN D aT IoN   6

Th e   Co m m i s s i o n  s h o u l d   t a k e   u rg e nt   s te p s   to   e n s u re   t h at   i t 
can account for the added value and sound financial manage -
me nt  o f Le ader.

M o n i t o r i n g   s h o u l d   b e   d i r e c t e d   t o w a r d s   i n d i c a t o r s   o f   t h e 
a d d e d   v a l u e   o f   t h e   L e a d e r   a p p r o a c h ,   e f f i c i e n c y   a n d   e f f e c -
t i v e n e s s ,   r a t h e r   t h a n   i m p l e m e n t a t i o n .   T h e   d a t a   s h o u l d   b e 
ver ified at source, at least on a sample basis. Given the scale 
a n d   n a t u re   o f   Le a d e r   a n d   t h e   d i f f i c u l t i e s   e n c o u n t e re d   t h u s 
f a r   i n   o b t a i n i n g   re l e va nt,   co m p a ra b l e   a n d   re l i a b l e   d at a ,   t h e 
Commission should consider more efficient and effec tive ap -
p ro a c h e s,   s u c h   a s   m o n i t o r i n g   s t a t i s t i c a l l y - v a l i d   s a m p l e s   o f 
LAGs in detail, through indicators, inspec tions and struc tured 
case studies with proper data verification by an independent 
eval uato r.

T h e   Co m m i s s i o n  s h o u l d   c o o r d i n a t e   t h e   M e m b e r   s t a t e s  t o 
en su re t hat  th e su p er vis or y an d contro l sys tems  provi de  as-
surance on the fairness and transparenc y of procedures; com-
p a ra b l e   d a t a   o n   t h e   co s t s ;   a n d   co m p l e m e nt   t h e   m o n i to r i n g 
of ef fe c tiven ess and efficienc y.

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Th i s   R e p o r t   w a s   a d o p te d   by   C h a m b e r   I ,   h e a d e d   by   M r   M i c h e l 
CRE TIN, Member of the Cour t of Auditors, in Luxembourg at its 
mee t ing o f 21 Ju l y 2010.

Fo r  th e  Co u r t  o f  Au d ito r s 

Vítor Manuel da SILVA CALDEIRA

Presi d e nt

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aN N E X

lIsT   o f   Pr o jE C T s   rE V I E wE D 1

Project description

Type of promoter

Total eligible cost

Leader grant2 

(euro)

Construction of a swimming lake

Acquisition of a railway locomotive

Acquisition of equipment for harvesting and processing fruit

Restoration of church including tourism facilities

Development of concept for a technical museum

Residential care home for demential patients

DE-BY

DE-MV

Local public sector 

Private sector

Association

Church authorities

Association

Association

Consultancy study: coordination of passenger boat trips

Local public sector

Public lighting for village lay-by

Feasibility study and website for town development project

Meat processing equipment

Construction of riverside path

Construction and equipping of a tavern

Re-paving of streets in town centre

Construction and equipping of a distillery

Construction and equipping of a restaurant

Construction and equipping of a winery

Construction and equipping of a guesthouse

Construction of new premises for a metal workshop

IE

EL

Association

Association

Private sector

Association

Private sector

Local public sector

Private sector

Private sector

Private sector

Private sector

Private sector

2 063 969

396 403

30 293

165 016

131 498

1 063 000

11 265

6 959

17 969

34 485

40 937

414 712

210 942

254 154

367 421

387 480

334 436

202 087

1 031 984

74 325

3 787

111 386

88 106

154 000

5 914

3 476

14 375

14 250

31 377

228 091

210 942

127 077

202 081

193 740

181 799

111 147

1  The Court selected projects that were typical of the range of projects financed by each LAG in terms of type of promoter, nature of the project 

(investments, studies, events, etc.) and size of the project in financial terms. Preference was given to projects completed between 2006 and 2008.

2  EU-funded element, except in Ireland, Greece and Hungary, where the amount includes the national co-financing.

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(euro)

Project description

Type of promoter

Total eligible cost

Leader grant2

Purchase of equipment for kindergartens (I)

Purchase of equipment for kindergartens (II)

Fitting out of water treatment plant

Restoration of houses for rural tourism

Fitting out of water information centre

Construction of an underground hotel

Purchase of equipment for an ecological bakery

Olive oil processing equipment

Construction of a rural hotel

Renovation of a village square

Rehabilitation of municipal play area

Enlargement of food processing factory

Information panels at tourist sites

Construction of rural tourism accommodation

Contemporary music event

Theatre management and staff salary costs

Development of distance learning agricultural course

Computerisation and networking of library records

Improvement of Internet site for cultural association

Modernisation of an IT system of a local company

Local administration IT system

Restoration of a historical building

‘Wine and sea’ tourist itinerary

Restoration and opening to public of an arboretum

Study on vacant properties and creation of a database

Public Internet access facilities

ES-A

ES-CM

FR (PL)

FR (LR)

Association 

Association

Private sector

Private sector

LAG

Private sector

Private sector

Private sector

Private sector

Local public sector

Local public sector

Private sector

LAG

Private sector

Association

Local public sector

Association

Local public sector

Association

Private sector

Local public sector

Local public sector

Local public sector

University

Association

Local public sector

Construction of mountain biking circuits and equipment for hire centre

Local public sector

29 910

39 000

369 000

222 597

180 000

277 187

189 599

78 993

617 026

30 450

36 096

409 179

254 847

245 061

59 994

219 272

16 070

50 312

4 097

51 227

80 830

393 803

162 014

33 626

12 507

327 900

107 281

14 955

19 500

30 050

30 051

60 000

30 051

25 596

28 437

98 130

8 583

26 532

69 050

150 254

40 012

21 997

91 950

7 794

25 156

3 277

7 684

40 415

129 360

81 007

14 757

5 865

120 431

32 845

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(e uro)

Project description

Type of promoter

Total eligible cost

Leader grant2

Purchase of a loom

Sanitisation equipment for food processing company

Re-paving of village streets

Purchase of fruit crates and upgrade of irrigation system

Purchase of a tractor

Purchase of woodworking machinery

Travelling photograph exhibition3

IT-TOS

Private sector

Private sector

Local public sector

Private sector

Private sector

Private sector

LAG

Services to the citizen (veterinary service and information)3

Local public sector

Community craft workshop

Renovation of wine cellar

Construction works to reinforce a parsonage building

HU

Local public sector

Private sector

Church authorities

Guest house facilities (outdoor jacuzzi, bicycles and storage shed, etc.)

Private sector

Ski trips and equipment for school pupils

Plans for paving a dirt road servicing vineyards

Purchase of projection equipment

Purchase of equipment for olive oil processing

Purchase of equipment for honey processing and marketing

Modernisation of wine cellar3

Purchase of additional karting equipment

Road signs

Establishment of shop for rural produce

PT

Local public sector

Private sector

Association

Private sector

Private sector

Private sector

Private sector

Local public sector

LAG

3  Review of file documents only.

120 000

90 000

293 438

30 970

37 000

63 000

101 894

243 000

10 514

20 962

6 009

2 760

10 507

2 960

7 000

199 500

39 600

100 000

24 922

92 048

136 067

18 000

13 500

33 609

4 646

13 218

9 450

30 670

52 232

7 980

9 433

4 506

2 361

7 880

2 516

5 250

69 825

13 860

35 000

8 723

69 036

102 050

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aN N E X

Pic ture 2: France (Lan guedoc -R o uss i llon) — 

Pic tu re 3: G ermany (M eck lenburg-Vorpommer n) 

‘Wine an d sea’  to ur i st itin erar y

— R es torat ion of chu rch including touri sm 

facilit ies

Pic ture 4: I taly ( Tuscany)  — Purch ase of  fru it 

Pic tu re 5: Spa in (Aragón) — R estorat ion  of 

crates

hou ses for rural tourism

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Pic ture 6: France (Lan guedoc -R o uss i llon) — 

Pic tu re 7: G reece — Construc tion and equipping 

Public I nternet access facili ti es

of a distiller y

Pic ture 8: Por tugal — Purchase  of  addit ional 

Pic tu re 9: G reece — Construc tion and equippin g 

k ar t ing equipment

of a tavern

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REPLy OF THE 
COMMISSION

EXECUTIVE sUMMary

I .
T h e   L e a d e r   m e t h o d   i s   a   p o l i c y   t o o l   f o r 
a c t i v e l y   i n v o l v i n g   a n d   e n g a g i n g   l o c a l 
a c t o r s   i n   t h e   d e ve l o p m e n t   o f   t h e i r   c o m-
m u n i t y   t h a n k s   to   i t s   d i s t i n c t i ve  ‘ b o t to m -
up’ approac h .

Leader is a major asset in reinforcing civil 
societ y in rural areas. There are now more 
t h a n   2   0 0 0   l o c a l   a c t i o n   g r o u p s   ( L A G s ) 
w h i c h   a r e   p u t t i n g   l o c a l   d e v e l o p m e n t 
strategies to wor k  with  EU r ural d eve lop -
ment f un din g.

L e a d e r   i s   a n   i n t e g r a l   p a r t   o f   t h e   r u r a l 
development polic y  2 0 07– 13. 

T h e   C o m m i s s i o n   d o e s   n o t   s h a r e   t h e 
C o u r t ’s   a s s e s s m e n t   t h a t   L A G s   r e p r e s e n t 
a n   a d d i t i o n a l   l a y e r.   R u r a l   d e v e l o p m e n t 
polic y is implemented in shared manage -
m e n t   b e t w e e n   t h e   C o m m i s s i o n   a n d   t h e 
M e m b e r   S t a t e s ,   r e s p e c t i n g   t h e   p r i n c i-
p l e   o f   s u b s i d i a r i t y.   T h e   i m p l e m e n t a t i o n 
o f   Le a d e r   i s   co m p l e m e n te d   by   a   s p e c i f i c 
mandator y feature, which is that a signif-
i c a nt   p a r t   o f   m a n a g e m e nt   t a s k s   i s   t ra n s-
fer red  to th e local level.

w i t h   r e g a r d   t o   i t s   c o s t s ,   t h e   a c t i v i t i e s 
d e ve l o p e d   by   t h e   L AG s   i n   t h e   f ra m e wo r k 
of their budget for running costs and ani-
m a t i o n   a r e   l i n k e d   t o   t h e   h o r i z o n t a l   p r i-
o r i t y   o f   p r o m o t i n g   c a p a c i t y - b u i l d i n g   o f 
local ac tors and helping potential projec t 
promoter s.

A s   r e g a r d s   t h e   i m p l e m e n t a t i o n   o f   t h e 
Le a d e r   a p p ro a c h   i n   t h e   c u r re nt   p ro gra m -
m i n g   p e r i o d ,   t h e   C o m m i s s i o n   h a s   t a k e n 
a   co m p re h e n s i ve   s e t   o f   a c t i o n s   a i m e d   a t 
f u r t h e r   e n c o u r a g i n g   g o o d   p r a c t i c e   a n d 
sound  finan cial manag ement.

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REPLy OF THE 
COMMISSION

T h e   Co m m i s s i o n   n o t a b l y   b u t   n o t   o n l y   i n 
i t s   a u d i t s   p a y s   a t t e n t i o n   t o   t h e   p r o j e c t 
s e l e c t i o n   p r o c e s s ,   t r a n s p a r e n c y ,   c o n-
f l i c t   o f   i n t e r e s t ,   e t c .   T h e   C o m m i s s i o n 
e xe c u te d   a u d i t s   o n   3 7   o u t   o f   7 3   Le a d e r + 
program me s for t he programmin g per i od 
2 0 0 0 – 0 6 ;   1 3   p r o g r a m m e s   w e r e   a u d i t e d 
more t han  on ce.

V I.
F o r   t h e   c u r r e n t   p r o g r a m m i n g   p e r i o d 
2 0 0 7 – 1 3 ,   t h e   n e c e s s a r y   l e g a l   p r o v i s i o n s 
have been included in the EAFRD 1 regula-
tion  an d it s im plem entin g r ules 2. 

Fu r t h e r m o r e ,   t h e   C o m m i s s i o n   h a s   p r o -
v i d e d   g u i d a n c e   t o   M e m b e r   S t a t e s   i n   t h e 
phase of programme design and approval 
t h ro u g h   t h e  ‘G u i d e   o n   t h e   a p p l i c at i o n   o f 
t h e   L e a d e r   a x i s ’.   T h i s   i n c l u d e d   s p e c i f i c 
a d v i c e   o n   t h e   p o t e n t i a l   a d d e d   v a l u e   o f 
Le a d e r,   i . e.   c o ve r a g e   o f   a l l   a xe s,   i n n o v a -
tion , integrated and  ter r itor ial appro ac h. 

I n   a d d i t i o n ,   t h e   C o m m i s s i o n   r e q u e s t e d 
a   s t r a t e g i c   a p p r o a c h   t o w a r d s   L e a d e r 
under the national strategic plans. At the 
s a m e   t i m e,   M e m b e r   S t a t e s   we re   a l l o we d 
t o   m a k e   d i f f e r e n t   c h o i c e s   a s   r e g a r d s 
t h e   s c o p e   o f   a p p l i c a t i o n   o f   t h e   L e a d e r 
m e t h o d   i n   re s p o n s e   to   t h e   s p e c i f i c   ex i s t-
i n g   e x p e r i e n c e   a t   L A G   l e v e l   a n d   t o   t h e 
n eeds identif ied  in the ir analyses.

1  European Agricultural Fund for Rural Development. 
2  Council Regulation (EC) No 1698/2005 of 20 September 

2005 on the support for rural development by the European 

Agricultural Fund for Rural Development (EAFRD) (OJ L 277, 

21.10.2005, p. 1), and Commission Regulation (EC) No 

1974/2006 of 15 December 2006 laying down detailed rules 

for the application of Council Regulation (EC) No 1698/2005 of 

20 September 2005 on the support for rural development by 

the European Agricultural Fund for Rural Development (EAFRD) 

(OJ L 368, 23.12.2006, p. 15).

II.
T h e   c r e a t i o n   o f   l o c a l   c a p a c i t y   l e a d s 
t o   i n c r e a s e d   l o c a l   d e v e l o p m e n t   a c t i v -
i t y,   p o o l i n g   l o c a l   r e s o u r c e s ,   n e t w o r k i n g 
a l l o w i n g   m u t u a l   l e a r n i n g   a n d   a n   i n t e -
g r a t e d   a p p r o a c h   t o   a d d r e s s   c o m p l e x 
e c o n o m i c   a n d   s o c i a l   i s s u e s .   T h i s   p l a y s 
a n   i m p o r t a n t   ro l e   i n   t h e   h o r i zo n t a l   r u ra l 
d e ve l o p m e n t   p r i o r i t y   o f   i m p ro v i n g   g o v -
er na nce.

IV.
L A G   m e m b e r s   a r e   i m p o r t a n t   a c t o r s   o f 
t h e   d e ve l o p m e nt   o f   a   r u ra l   te r r i to r y.  Th e 
b o t t o m - u p   a p p r o a c h   c h a r a c t e r i s t i c   o f 
L e a d e r   s h o u l d   b e   a p p l i e d   i n   a   w a y   t h a t 
l o c a l   o r g a n i s a t i o n s   o r   i n d i v i d u a l s   w h o 
are mem be rs o f a  LAG  can p l ay  an  im por-
ta nt ro l e. 

L A G s   a r e   e n c o u r a g e d   t o   p r e s e n t   i n n o -
v a t i v e   l o c a l   d e v e l o p m e n t   s t r a t e g i e s   b u t 
i n n o v a t i o n   i s   o n e   L A G   s e l e c t i o n   c r i t e -
r i o n   a m o n g   o t h e r s.   A   l o c a l   d e ve l o p m e n t 
s t r a t e g y   c a n n o t   d e a l   w i t h   i n n o v a t i v e 
approach es o nl y. 

wi t h   re g a rd   to   i nte grate d   p ro j e c t s,   m o s t 
l o c a l   s t r a t e g i e s   c o v e r   s e v e r a l   m e a s u r e s 
a n d   a r e   a p p l i e d   t o   s e v e r a l   s e c t o r s   o r 
inter vention areas. There are examples of 
good prac tice with programmes introduc -
ing an integrated approach. The European 
N e t w o r k   f o r   R u r a l   D e v e l o p m e n t   ( E N R D ) 
will promo te thes e go od  p rac tice s.

V.
M e m b e r   St ate s   h ave   to   e n s u re   t h at   t h e re 
is no conflic t of interest under the shared 
m a n a g e m e nt   a p p ro a c h .   D e c i s i o n - m a k i n g 
p r o c e d u r e s   a n d   s e l e c t i o n   c r i t e r i a   t o   b e 
a p p l i e d   b y   t h e   L A G s   a r e   n o t   p a r t   o f   t h e 
p r o g r a m m e   b u t   p a r t   o f   t h e   l o c a l   i m p l e -
m e n t a t i o n   a s s e s s e d   b y   t h e   m a n a g i n g 
authorit y when the LAG is selec ted. M em -
b e r   S t a t e s   c a n   a l s o   a p p l y   c o m m o n   r u l e s 
for all LAGs es t ab lis hed at  n atio n al  le ve l.

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T h e   C o m m i s s i o n   c o n t r i b u t e s   o n   a n   o n -
g o i n g   b a s i s   t o   b e t t e r   p ro c e d u re s   fo r   t h e 
m a n a g e m e n t   a n d   c o n t ro l   s y s t e m s   i n   t h e 
M e m b e r   S t a t e s   t h ro u g h   t h e   p ro v i s i o n   o f 
a d v i c e   a n d   g u i d a n c e,   a s   we l l   a s   t h ro u g h 
r e c o m m e n d a t i o n s   s t e m m i n g   f r o m   i t s 
a u d i t s   a n d   w h e r e   a p p r o p r i a t e   b y   a p p l y -
ing financ ia l co r rec tion s.

The Commission will consider revising the 
‘G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e   L e a d e r 
a x i s’  w i t h   r e g a r d   t o   p r o j e c t   s e l e c t i o n   t o 
f u r t h e r   c l a r i f y   t h e   n e e d   f o r   s o u n d   p r o -
c e d u r e s   r e s p e c t i n g   k e y   p r i n c i p l e s   s u c h 
a s   t r a n s p a re n c y,   e q u a l   t re a t m e n t ,   u s e   o f 
o b j e c t i v e   s e l e c t i o n   c r i t e r i a   o r   d e c i s i o n 
repor t ing.

VII.
Th e   e x - p o s t  e va l u at i o n   o f   Le a d e r + ,   w h i c h 
i s   u n d e r   w a y   a n d   w i l l   p r o d u c e   i t s   f i n a l 
repor t towards the end of 2010, is consid -
er ing the issues of effec tiveness and effi-
cienc y of Leader expenditure. I t is nor mal 
p r a c t i c e   t o   a s s e s s   t h e   e f fe c t i v e n e s s   a n d 
efficienc y of polic y instruments on an ex-
p o s t  b a s i s.  T h i s   e v a l u a t i o n   fo r m s   p a r t   o f 
t h e   s t a n d a rd   p o l i c y   e va l u at i o n   c yc l e   a n d 
i t s   t i m i n g   h a s   b e e n   m a r k e d   b y   t h e   f a c t 
t h a t   L e a d e r +   w a s   s t i l l   a c t i v e   u n t i l   J u n e 
20 09 as  re g ards 40 p rogrammes.

T h e   C o m m i s s i o n   ( T h e m a t i c   w o r k i n g 
G r o u p   o f   t h e   E u r o p e a n   E v a l u a t i o n   N e t -
wor k for Rural D evelopment) has recently 
i s s u e d   a   f i n a l   d r a f t   g u i d a n c e   d o c u-
m e n t   o n   t h e   e v a l u a t i o n   o f   t h e   i m p a c t   o f 
Leader 3. 

VIII.
T h e   i m p l e m e n t a t i o n   o f   p r o c e d u r e s   t o 
a v o i d   t h e   r i s k   o f   c o n f l i c t   o f   i n t e r e s t ,   i n 
co m p l i a n ce   w i t h   t h e   f i n a n c i a l   re g u l at i o n 
a p p l i c a b l e   t o   t h e   g e n e r a l   b u d g e t   o f   t h e 
E u r o p e a n   U n i o n ,   i s   t h e   r e s p o n s i b i l i t y   o f 
M ember St ates.

3  Capturing impacts of Leader and of measures to improve 
quality of life in rural areas, Draft working Paper 4, 21 June 2010, 

I X.
Th e   Co m m i s s i o n   e n s u re s   t h a t   o b j e c t i ve s 
s e t   a t   p r o g r a m m e   l e v e l   s h a l l   b e   s u p -
p o r te d   by   i n d i c ato r s   t h at   M e m b e r   St ate s 
w i l l   o b t a i n   a t   L AG   l e v e l   i n   o r d e r   t o   p r o -
d u ce   a g gre g ate d   d at a   at   t h e   l e ve l   o f   t h e 
Lea der a xis.

O b j e c t i ve s   o n   t h e   l e ve l   o f   t h e   l o c a l   s t rat-
e g i e s   s h o u l d   b e   e s t a b l i s h e d   i n   l i n e   w i t h 
S MA R T   ( s p e c i f i c,   m e a s u ra b l e,   a c h i e va b l e, 
time ) cr iter ia to t he ex tent  po ssible.

X.
T h e   C o m m o n   M o n i t o r i n g   a n d   E v a l u a-
t i o n   F r a m e w o r k   ( C M E F ) 4  i s   f o c u s i n g   o n 
t h e   Le a d e r   a d d e d   v a l u e,   n o t a b l y   i n   re l a-
t i o n   t o   i t s   i m p a c t .  T h e   i m p a c t   o f   Le a d e r 
i s   h o w e v e r   m o r e   d i f f i c u l t   t o   m e a s u r e 
s i n c e   i t   m a i n l y   re l a t e s   t o   l o c a l   c a p a c i t y - 
b u i l d i n g   ( s o c i a l   c a p i t a l )   a n d   i s   d r i ve n   by 
t h e   l o c a l   d e ve l o p m e n t   p ro c e s s.   M e m b e r 
S t a t e s   s h a l l   e n s u re   t h a t   t h e   a p p r o p r i a t e 
mon itor in g in for mat ion  is availa ble.

4  The Common Monitoring and Evaluation Framework (CMEF) 
provides a single framework for monitoring and evaluation 

of all rural development interventions for the programming 

period 2007–13. The CMEF establishes means for improving 

programme performance, ensuring the accountability of 

programmes and allowing an assessment on the achievement 

European Evaluation Network for Rural Development.

of established objectives.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Th e re   a re   s p e c i f i c   C M E F   e va l u at i o n   q u e s-
t i o n s   f o r   Le a d e r   o n   t h e   i m p r o v e m e n t   o f 
g o v e r n a n c e ,   t h e   m o b i l i s a t i o n   o f   e n d o g-
e n o u s   d e ve l o p m e n t   p o t e n t i a l,   m u l t i s e c -
t o r a l   a p p r o a c h e s   a n d   c o o p e r a t i o n ,   a n d 
the contr ibution to the pr ior ities of other 
axes. 

INTroDUCTIoN

6. 
T h e   c r e a t i o n   o f   l o c a l   c a p a c i t y   l e a d s 
t o   i n c r e a s e d   l o c a l   d e v e l o p m e n t   a c t i v -
i t y,   p o o l i n g   l o c a l   r e s o u r c e s ,   n e t w o r k i n g 
a l l o w i n g   m u t u a l   l e a r n i n g   a n d   a n   i n t e -
g r a t e d   a p p r o a c h   t o   a d d r e s s   c o m p l e x 
e c o n o m i c   a n d   s o c i a l   i s s u e s .   T h i s   p l a y s 
a n   i m p o r t a n t   ro l e   i n   t h e   h o r i zo n t a l   r u ra l 
d e ve l o p m e n t   p r i o r i t y   o f   i m p ro v i n g   g o v -
er na nce 5.

5  Fourth priority of the Community strategic guidelines for the 
programming period 2007 to 2013 as set out in Council Decision 

2006/144/EC of 20 February 2006.

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7 . 
Th e   Co m m i s s i o n   co n s i d e r s   t h at   t h e   L AG s 
d o   n o t   r e p r e s e n t   a n   a d d i t i o n a l   l a y e r. 
R u r a l   d e v e l o p m e n t   p o l i c y   i s   i m p l e -
m e n te d   i n   s h a re d   m a n a g e m e n t   b e t we e n 
t h e   Co m m i s s i o n   a n d   t h e   M e m b e r   S t a te s, 
r e s p e c t i n g   t h e   p r i n c i p l e   o f   s u b s i d i a r i t y. 
The implementation of Leader is comple -
m e nte d   by   a   s p e c i f i c   m a n d ato r y   fe at u re, 
w h i c h   i s   t h a t   a   s i g n i f i c a n t   p a r t   o f   m a n-
a g e m e nt   t a s k s   i s   t ra n s fe r re d   to   t h e   l o c a l 
l e ve l.  Th i s   s h o u l d   n o t   n e ce s s a r i l y   m e a n   a 
duplication of t as ks.

w i t h   r e g a r d   t o   t h e   c o s t s ,   t h e   a c t i v i t i e s 
d e ve l o p e d   by   t h e   L AG s   i n   t h e   f ra m e wo r k 
of their budget for running costs and ani-
m a t i o n   c o n t r i b u t e   t o   t h e   h o r i z o n t a l   p r i -
o r i t y   o f   p r o m o t i n g   c a p a c i t y - b u i l d i n g   o f 
local ac tors and helping potential projec t 
promoter s. The y  go  f ar  beyon d  th e   s cope 
o f   w h a t   n a t i o n a l   o r   r e g i o n a l   a u t h o r i t i e s 
offer  in top - down  grant  s ch emes.

A s   r e g a r d s   t h e   i m p l e m e n t a t i o n   o f   t h e 
Le a d e r   a p p ro a c h   i n   t h e   c u r re nt   p ro gra m -
m i n g   p e r i o d ,   t h e   C o m m i s s i o n   h a s   t a k e n 
a   co m p re h e n s i ve   s e t   o f   a c t i o n s   a i m e d   a t 
f u r t h e r   e n c o u r a g i n g   g o o d   p r a c t i c e   a n d 
sound  finan cial manag ement :

—  t h e   e s s e nt i a l   p r i n c i p l e s   o f   t h e   Le a d e r 
a p p ro a c h   h ave   b e e n   l a i d   d ow n   i n   t h e 
relevant  le gal f ramewor k ;

— 

it h as provide d g uidan ce  in  the ph ase 
o f   p r o g r a m m e   d e s i g n   a n d   a p p r o v a l 
through the ‘Guide on the application 
of th e Leader axis’ ;

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

— 

it h as es tab lis hed ‘focu s gro ups’ wi th-
i n   t h e   L e a d e r   s u b - c o m m i t t e e   o f   t h e 
E u r o p e a n   N e t w o r k   f o r   R u r a l   D e v e l-
o p m e n t   ( E N R D )   w i t h   a   m a n d a t e   t o 
e x a m i n e   i m p l e m e n t a t i o n   i s s u e s .   T h e 
EN R D  co ntinue s   w ith   t he  exc h ang e   of 
a c h i e ve m e n t s,   e x p e r i e n c e   a n d   k n o w -
h o w   b e t w e e n   t h e   a c t o r s   i n v o l v e d   i n 
the  im pl eme ntation o f th e Leade r  ap -
p ro a c h   a s   i t   w a s   a l re a d y   a   p r i o r i t y   o f 
L e a d e r   I I   a n d   L e a d e r +   ( t h e n   w i t h   i t s 
E u r o p e a n   L e a d e r   I I   a n d   L e a d e r +   O b -
ser vator ies).

aUDIT sCoPE aND aPProa CH

8.
Please  see  the  Commission  reply  to  para-
graph 7.

9.
I n 2009 most Leader+ local strategies had 
b e e n   c l o s e d   a n d   i m p l e m e n t a t i o n   o f   t h e 
2 0 0 7 – 1 3   l o c a l   s t rate gi e s   h a d   n o t   s t a r te d 
yet, with generally low ac tivity.

oBsEr VaTIoNs

joint reply 13–15 and Box 2:
T h e   C o m m i s s i o n   w e l c o m e s   t h e   C o u r t ’s 
ack nowledgement of LAGs’ good prac tices 
i n   p r o m o t i n g   l o c a l   c o m m u n i t y   i n v o l v e -
ment and par ticipation.

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16.
T h e   p r o c e s s - o r i e n t e d   L e a d e r   a p p r o a c h 
entails the design and implementation of 
a  strategy  involving  the  local  communit y 
at large.

LAG member organisations are represent-
a t i v e   a n d   a c t i v e   l o c a l l y   b a s e d   o r g a n i s a-
t i o n s   o f   t h e   r u r a l   te r r i to r y.  Th e   Co m m i s-
s i o n   n o t i c e   o n   L e a d e r + 6,   w h i c h   w a s   t h e 
reference  document  for  the  national  and 
re g i o n a l   Le a d e r +   p r o g r a m m e s,   s t a t e s   i n 
i t s   p o i n t   1 2 :   ‘ L o c a l   a c t i o n   g r o u p s   m u s t 
consist  of  a  balanced  and  representative 
selec tion  of  par tners  drawn  from  the  dif-
ferent socioeconomic sec tors in the terri-
tor y concerned’. The par tners consist of a 
mix of public entities and par tners repre -
s e n t i n g   t h e   c i v i l   s o c i e t y.   T h e s e   p a r t n e r s 
are also the main authors of the strategies 
a n d   d o   i n   m o s t   c a s e s   r e p r e s e n t   a   l a r g e 
par t  of  the  population  of  the  ter r itor y.  I t 
i s   t h e re fo re   n o r m a l   t h a t   a   p ro p o r t i o n   o f 
projec ts are originating from these mem-
ber organisations. LAG members can play 
a n   i m p o r t a n t   r o l e   f o r   t h e   i m p l e m e n t a -
t i o n   o f   t h e   l o c a l   d e v e l o p m e n t   s t r a t e g y. 
I n addition, it should be stressed that the 
e f fe c t i ve   i nvo l ve m e n t   o f   o t h e r   a c t o r s   o f 
the territor y in the implementation of the 
l o c a l   s t r a t e g y   s t r o n g l y   d e p e n d s   o n   t h e 
local contex t. For example, in the current 
p e r i o d   i n   G r e e c e   L A G   m e m b e r s   c a n   b e 
b e n e f i c i a r i e s   a n d   i m p l e m e nt   p ro j e c t s   u p 
to   3 0  %   o f   t h e   p u b l i c   e x p e n d i t u re   o f   t h e 
local strategy. Given the wide diversit y of 
LAG  membership,  it  would  be  difficult  to 
impose at EU level a specific propor tion of 
projec ts  to  be  promoted  by  other  ac tors. 
M e m b e r   S t a t e s   s h o u l d   e n s u r e   t h a t   t h e 
wider community can par ticipate.

6  Commission notice to the Member States of 14 April 2000 
laying down guidelines for the Community initiative for rural 

development (Leader+).

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2 3. 
S e e   C o m m i s s i o n   r e p l y   t o   p a r a g r a p h s 
2 1–2 2.

B ox 5
S e e   C o m m i s s i o n   r e p l y   t o   p a r a g r a p h s 
2 1–2 2.

2 5. 
The necessar y degree of precision should 
b e   d e f i n e d   b y   t h e   M e m b e r   S t a t e ,   w h i c h 
c a n   a d a p t   i t   t o   t h e   s p e c i f i c   c o n t e x t   o f   a 
given  ter r itor y.

2 6. 
L o c a l   d e v e l o p m e n t   s t r a t e g y   o b j e c t i v e s 
should be established in line with SMAR T 
cr iter ia (specific, measurable, achievable, 
tran sferable)  to th e ex te nt  poss ible.

R u r a l   d e v e l o p m e n t   f u n d i n g   s u p p o r t s 
b o t h   a s s i s t a n c e   a n d   t r a i n i n g   a c t i v i t i e s 
d e l i ve re d   b y   t h e   p ro g r a m m e   a u t h o r i t i e s 
through the sub -measure ‘acquiring sk ills’ 
or by t he n ation al r ural n et wor ks.

C e r t a i n   s c e n a r i o s   a r e   l o n g - t e r m   t r e n d s 
t h at   c a n n o t   b e   co n f i n e d   w i t h i n   t h e   t i m e -
f r a m e   o f   s e v e n - y e a r   l o c a l   d e v e l o p m e n t 
strategies, such as for example ‘rural exo -
dus and abandonment of traditional agr i -
cult ure’ refer red  to by  t he Cour t.

B ox 6
S ee  Com mis sio n reply to paragraph 26 .

19 .
T h e   C o m m i s s i o n   a g r e e s   w i t h   t h e   C o u r t 
that  an  o p en  me mb ership   p o l ic y   is   de si r-
a b l e   a n d   w i l l   co n s i d e r   t h i s   fo r   t h e   d e s i gn 
of t he p os t-2013 p o l ic y.

B ox  3 
T h e   c o m p o s i t i o n   o f   t h e   G r e e k   L A G 
a u d i t e d   b y   t h e   C o u r t   c o m p l i e s   w i t h   t h e 
e x i s t i n g   E U   r e g u l a t o r y   f r a m e w o r k .   T h e 
s e l e c t i o n   o f   t h e   p r o j e c t s   f a l l s   u n d e r   t h e 
re s p o n s i b i l i t y   o f   a   s p e c i a l   d e c i s i o n - m a k-
i n g   c o m m i t t e e ,   w h e r e   5 0  %   o f   t h e   p a r t -
ners a re p r ivate.

20 . 
T h e   s y n t h e s i s   o f   t h e   L e a d e r +   m i d - t e r m 
e v a l u a t i o n   i n d i c a t e s   t h a t   c o n t i n u o u s 
involvement of young people in decision-
m a k i n g   b o d i e s   i s   v e r y   r a r e .   T h i s   m a y   b e 
d u e   to   l o c a l l y   b a s e d   yo u t h   o rg a n i s at i o n s 
which are not well struc tured or even fre -
quent  in ru ral areas.

joint re ply 21– 22: 
D u r i n g   t h e   n e g o t i a t i o n s   l e a d i n g   t o   t h e 
a p p r o v a l   o f   t h e   r u r a l   d e v e l o p m e n t   p r o -
gr a m m e s   ( R D Ps )   fo r   t h e   2 0 0 7 – 1 3   p e r i o d, 
the Commission examined that the princi-
ple of a minimum of 50  % representatives 
of the civil societ y in the par tnership was 
i n c l u d e d ,   a s   r e q u i r e d   b y   A r t i c l e  6 2 . 1 ( b ) 
o f   R e g u l a t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5 .   T h i s 
requirement applies to the decision-mak-
ing level.

St i l l,   t h e   Co m m i s s i o n   w i l l   co n s i d e r   re v i s -
i n g   e x i s t i n g   g u i d a n c e   i n   o r d e r   t o   a v o i d 
any  misinter p ret at ion .

B ox  4
S e e   C o m m i s s i o n   r e p l y   t o   p a r a g r a p h s 
21 –22.

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3 0. 
C a l l s   fo r   p ro p o s a l s   a n d   t h e   a c t u a l   s e l e c -
t i o n   o f   p r o j e c t s   h a v e   t o   b e   d o n e   o n   t h e 
l o c a l   l e v e l ,   b y   t h e   L AG ,   e n s u r i n g   c o h e r -
e n c e   b e t w e e n   t h e   e l i g i b i l i t y   c o n d i t i o n s 
an d th e objec t ives  of th e strate gy.

3 1. 
I n   Le a d e r +   m o n i to r i n g   a n d   e va l u at i o n   o f 
t h e   l o c a l   d e ve l o p m e n t   s t r a t e g y   w a s   re c -
o m m e n d e d   b y   t h e   L e a d e r +   g u i d e l i n e s 
o n   e v a l u a t i o n .   Fu r t h e r m o r e ,   L A G - l e v e l 
evaluation ac tivities were eligible for co -
fin ancin g. 

3 2.
A ‘review of the achievements’ as a means 
of communicating with the public cannot 
b e   a s s i m i l ate d   to   a   f u l l   e va l u at i o n   o f   t h e 
loca l s trategy.

T h e   i m p l e m e n t a t i o n   o f   p r o j e c t s   i s   t h e 
i m m e d i a t e   r e s u l t   o f   a   L A G ’s   a c t i v i t i e s . 
M e a s u r i n g   t h e i r   i m p a c t   i s   o f te n   d i f f i c u l t, 
s i n c e   m a n y   o f   t h e m   a r e   l i n k e d   t o   t h e 
d e ve l o p m e nt   p ro ce s s   ( c a p a c i t y- b u i l d i n g, 
etc.) .

3 3.
T h e   i m p l e m e n t a t i o n   o f   t h e   L e a d e r   a x i s 
h a d   h a r d l y   s t a r t e d   a t   t h e   t i m e   o f   t h e 
a u d i t   i n   m o s t   o f   t h e   M e m b e r   S t a t e s   v i s-
ited by  the  Cour t.

wi t h   r e g a r d   t o   t h e   r e fe r r e d  ‘ l a c k   o f   s p e -
cific local objec tives’, please see the Com-
mission reply to paragraph 26. I n relation 
to   t h e  ‘i m p o s i t i o n   o f   t h e   u s e   o f   co m m o n 
m e a s u r e s’  b y   M e m b e r   S t a t e s,   p l e a s e   s e e 
th e Commission  reply  to paragraph  8 4 .

27 . 
T h e   C o m m i s s i o n   d o e s   n o t   n e c e s s a r i l y 
s h a r e   t h e   C o u r t ’s   c o n c l u s i o n   t h a t   t h e 
m o u n t a i n - b i k i n g   ce n t re   d i d   n o t   co n t r i b -
u t e   t o   t h e   o b j e c t i v e   o f   c o m p e t i t i v e n e s s 
o f   t h e   a re a   a s   s e t   o u t   i n   t h e   l o c a l   d e ve l-
opment  strategy.

28 . 
T h e   C o m m i s s i o n   a g r e e s   w i t h   t h e   C o u r t 
to the ex tent  that the tot alit y  o f  proje c ts 
h a v e   t o   s e r v e   t h e   l o c a l   s t r a t e g y   o b j e c -
t i v e s .   H o w e v e r,   t h e   e x t e n t   t o   w h i c h   t h e 
refer re d  p ro jec t   f it ted  into   th e  wi de r   te r-
r i to r i a l   s t rate g y   h a d   to   b e   d e te r m i n e d   at 
l o c a l   l e ve l   b y   t h e   L AG .   Pro j e c t s   c a n   a l s o 
a d d   v a l u e   to   a   te r r i to r i a l   t h e m e   t h ro u g h 
c o n t r i b u t i n g   t o   a n   o v e r a l l   o b j e c t i v e   o f 
the  st rateg y.

B ox  7
T h e   C o m m i s s i o n   s h a r e s   t h e   v i e w   t h a t 
Le a d e r   s h o u l d   n o t   s u p p o r t   t h e   a c t i v i t i e s 
o f   l o c a l   a u t h o r i t i e s   d e r i v i n g   f r o m   s t a t u-
t o r y   r e q u i r e m e n t s .   H o w e v e r,   p r o j e c t s 
implemented by municipalities should be 
eligible under Leader if they are par t of a 
wider regional concept and contr ibute to 
t h e   o b j e c t i ve s   o f   t h e   l o c a l   d e ve l o p m e n t 
strateg y.

29 . 
The implementation of a strategy in terms 
o f  ‘m e a s u re s’  d o e s   n o t   n e c e s s a r i l y   i m p l y 
t h a t   p r o j e c t s   c a n n o t   b e   a s s e s s e d   a n d 
selec ted with regard to the local strategy 
o b j e c t i v e s .   P r o g r a m m e s   c a n   f o r e s e e   a 
g e n e ra l   s t r u c t u re   fo r   t h e   l o c a l   s t rate gi e s 
t h at   e n s u re s   t h e   re s p e c t   o f   b o t h   t y p e s   o f 
c r i t e r i a ,   a s   i t   i s   f o r   e x a m p l e   t h e   c a s e   i n 
Spain .

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3 8. 
Please  s ee  th e  Commiss ion   re ply  to  para-
graph  3 7. 

The  Commission  under line s t wo poi nt s:

—  t h e   i n n o v a t i ve   c h a r a c t e r   o f   a   p r o j e c t 
c a n n o t   b e   e x c l u d e d   j u s t   b e c a u s e   i t 
c o n c e r n s   t h e   p u r c h a s e   o f   s t a n d a r d 
p r o d u c t s .  T h i s   m a y   b e   i n n o v a t i v e   f o r 
t h e   g i ve n   s e c t o r   o r   i m p l y   p r o c e s s   i n-
n ovat ion in t he mar keting  system s;

—  the two projec ts in Hungar y where the 
Cour t seems to have doubts as regards 
t h e i r  ‘n o ve l t y ’  h ave   t o   b e   a s s e s s e d   i n 
th eir  spec ific  local contex t.

H owe ve r,   u n d e r   s h a re d   m a n a g e m e nt,   t h e 
C o m m i s s i o n   i s   n o t   r e s p o n s i b l e   f o r   t h e 
choice of proj ec ts to be finance d.

4 0. 
T h e   f a c t   t h a t   i n d i v i d u a l   p ro j e c t s   f u n d e d 
u n d e r   L e a d e r   w o u l d   a l s o   b e   e l i g i b l e   f o r 
other EU funding does not put into ques-
t i o n   t h e   l e g a l i t y   a n d   r e g u l a r i t y   o f   t h e 
s u p p o r t   u n d e r   Le a d e r.   Fu r t h e r m o re,   i t   i s 
up to the LAG to decide in a local contex t 
i f   a   p ro j e c t   a d d s   v a l u e   to   t h e   i m p l e m e n-
t a t i o n   o f   t h e   s t r a t e g y.   N o t   a l l   p r o j e c t s 
h a v e   t o   c o n t r i b u t e   t o   t h e   o b j e c t i v e s   o f 
t h e   s t r a t e g y   w i t h   t h e   s a m e   w e i g h t ,   a s 
s o m e   o f   t h e m   m i g h t   a d d   v a l u e   t o   a   c o n-
crete ter r itor ial theme by contr ibuting to 
a large r overall obj ec tive.

34 . 
I n n o v a t i o n   i s   a   f e a t u r e   o f   t h e   L e a d e r 
a x i s   ( A r t i c l e   6 1 ( e )   o f   R e g u l a t i o n   ( E C ) 
N o  1 6 9 8 / 2 0 0 5 ) ,   b u t   i s   n o t   m a n d a t o r y   a t 
L A G   l e v e l   ( A r t i c l e   6 2 . 1 ( a )   o f   R e g u l a t i o n 
(EC ) No 1698/2005). LAGs are encouraged 
to   p re s e nt   i n n ovat i ve   l o c a l   d e ve l o p m e nt 
s t r a t e g i e s   b u t   i n n o v a t i o n   i s   o n e   L A G 
selec tion cr iter ion among others. I nnova -
t i o n   i s   t h e re fo re   n o t   n e c e s s a r i l y   p re s e n t 
in a ll pro je c t su p p or ted.

L o c a l   d e v e l o p m e n t   s t r a t e g i e s   c o v e r   a 
b ro a d   ra n g e   o f   d e ve l o p m e n t   g o a l s   to   b e 
achieved  thro ugh   a  given  set  o f  proj e c t s. 
S ome projec ts that cannot be considered 
innovative may nonetheless be necessar y 
f o r   t h e   s t r a t e g y   a n d   f u n d e d   b y   L e a d e r. 
T h e   l o c a l   a c t o r s   m a n a g i n g   t h e   s t r a t e g y 
n e e d   a   m i n i m u m   d e g r e e   o f   f l e x i b i l i t y 
regard ing fu nding o p p or t un ities.

36 . 
L A G s   s h o u l d   e n s u r e   t h e   c o - e x i s t e n c e , 
synergy and complementar it y of projec ts 
in the are a.

w h i l e   t h e   l o c a l   s t r a t e g y   s h o u l d   i n d e e d 
b e   i n t e g r a t e d   a n d   f o r e s e e   i n t e r a c t i o n 
bet wee n  s ec to rs,   individu al   p ro j ec t s  m ay 
not be s o.

37 . 
I n   L e a d e r +   L A G s   w e r e   e n c o u r a g e d   t o 
p r e s e n t   i n n o v a t i v e   l o c a l   d e v e l o p m e n t 
s t rate gi e s   b u t   i n n ovat i o n   wa s   o n e   s e l e c -
tion cr iter ion  a mong o ther s. 

I n n o v a t i o n   c a n n o t   b e   a s s e s s e d   i n   a b s o -
l u t e   te r m s.   I n n ov a t i ve   i s   w h a t   i s   n e w   fo r 
t h e   te r r i to r y   co n ce r n e d   o r   i f   t h e   m e t h o d 
is impl emented  for  t he firs t time.

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B ox 1 0
l a G   i n   Tu s c a n y.   T h e   C o m m i s s i o n   w i l l 
e x a m i n e   i n   d e p t h   t h e   q u e s t i o n   o f   t h e 
s t a r t   o f   p r o j e c t   e l i g i b i l i t y   t a k i n g   i n t o 
a c c o u n t   t h e   n e e d   f o r   a   h a r m o n i s e d 
a p p r o a c h   a c r o s s   C o m m u n i t y   f u n d i n g 
unde r sh ared manage me nt.

A s   f o r   T u s c a n y ,   t h e   s i t u a t i o n   u n d e r 
Le a d e r +   w a s   t h e   fo l l ow i n g :  Th e   p re p a ra-
t i o n   o f   t h e   Le a d e r +   p ro gra m m e   i nvo l ve d 
e x te n s i ve   co n s u l t a t i o n   o f   t h e   l o c a l   p a r t-
n e r s .   M o r e o v e r,   s o m e   o f   t h e   t e r r i t o r i e s 
c o v e r e d   b y   L e a d e r   h a d   a l r e a d y   p a r t i c i -
p a t e d   i n   t h e   p re v i o u s   Co m m u n i t y   i n i t i a-
t i ve s.   Fo l l ow i n g   t h e   a p p rova l   o f   t h e   p ro -
g r a m m e ,   t h e   L A G s   c o u l d   e x p e r i e n c e   a 
legitimate expec tation that their projec ts 
w o u l d   h a v e   b e e n   e l i g i b l e   f o r   s u p p o r t , 
o n c e   a l l   t h e   p r o c e d u r a l   s t e p s   n e c e s s a r y 
to   i m p l e m e nt   t h e   p ro gra m m e   we re   co m-
pleted.

I n   t h i s   s p e c i f i c   c a s e,   n o   c a l l s   fo r   p ro j e c t s 
w e r e   a v a i l a b l e   t o   t h e   L A G s   f o r   q u i t e   a 
l o n g   p e r i o d   i n   w h i c h   t h e   i m p l e m e n t a-
t i o n   o f   s t r a t e g i e s   s h o u l d   h a v e   a l r e a d y 
s t a r t e d .   I n   o r d e r   t o   e n s u r e   t h e   e f fe c t i v e 
i m p l e m e n t a t i o n   o f   t h e i r   l o c a l   s t r a t e g i e s 
L A G s   h a d   t o   a g r e e   o n   t h e   s t a r t   o f   n o n -
c o m m e r c i a l   p r o j e c t s   o f   p u b l i c   a u t h o r i -
t i e s,   w h e n   t h e s e   w e r e   i m p o r t a n t   fo r   t h e 
i m p l e m e n t a t i o n   o f   t h e   l o c a l   s t r a t e g i e s , 
a t   a   m o m e n t   w h e n   t h e y   w e r e   n o t   a b l e 
t o   g e t   a   d e c i s i o n   o n   a   g r a n t .   O t h e r w i s e, 
s u p p o r t   f o r   i m p o r t a n t   a c t i o n s   f r o m   t h e 
loca l  de velopment  s trategie s  would   h ave 
b e e n   i nte r r u p te d   fo r   at   l e a s t   t h re e   ye a r s. 
Th e s e   p ro j e c t s   d i d   o f   co u r s e   re s p e c t   t h e 
s e l e c t i o n   c r i t e r i a   o f   t h e   l o c a l   s t r a t e g i e s 
a n d   h a d   t o   c o m p l y   w i t h   t h e   r e l e v a n t   E U 
provision s.

41 . 
T h e   Co m m i s s i o n   s h a re s   t h e   Co u r t ’s   v i e w 
t h a t   i n   p r i n c i p l e   Le a d e r   s h o u l d   n o t   s u p -
p o r t   n o r m a l   l o c a l   g ove r n m e nt   a c t i v i t i e s. 
H owe ve r,   c e r t a i n   p ro j e c t s   o f   m u n i c i p a l i-
t i e s   a re   l e gi t i m ate   p a r t s   o f   a   l o c a l   d e ve l -
opment strategy, the municipalities being 
a fundamental par tner in the local devel-
o p m e nt   p ro ce s s.   S h o u l d   t h e s e   m u n i c i p a l 
projec ts be par t of the local development 
s t r a t e g y   o r   a t   l e a s t   c o r r e s p o n d   t o   t h e 
g o a l s   o f   t h i s   s t r a t e g y,   t h e n   t h e r e   i s   n o 
reason to assume that the added value of 
the  Le ader app ro ach  is  reduced.

I n   t h e   a r e a   o f   q u a l i t y   o f   l i f e   a n d   r u r a l 
h e r i t a g e   ( b o t h   p r i o r i t i e s   o f   Le a d e r +   a n d 
A x i s  3 )   l o c a l   a u t h o r i t i e s   a r e   t h e   m o s t 
common promoters. Fur thermore, in some 
M e m b e r   S t a t e s   s u c h   a s   S p a i n ,   m u n i c i-
p a l i t i e s   a re   o f   s u c h   s m a l l   d i m e n s i o n   t h at 
t h e y   a p p e a r   a s   t h e   i d e a l   p r o m o t e r   o f 
l o c a l   p ro j e c t s,   o f t e n   d u e   t o   t h e   a b s e n c e 
of suita bl e pr ivate p ro moters.

T h e   Co m m i s s i o n   s h a re s   t h e   Co u r t ’s   v i e w 
t h at   p ro j e c t s   s h o u l d   n o t   h ave   b e e n   co m-
p l e t e d   b e f o r e   t h e   a p p l i c a t i o n   f o r   t h e 
Le a d e r   gra nt.   Pl e a s e   s e e   t h e   Co m m i s s i o n 
replies  to  boxes 9  and 10.

B ox  9
P l e a s e   s e e   C o m m i s s i o n   r e p l y   t o   p a r a-
graph  41.

I n f r a s t r u c t u r e   p r o j e c t s   c a r r i e d   o u t   b y 
municipalities are not per se par t of their 
mandato r y  t ask s. 

I f   t h i s   t y p e   o f   v i l l a g e   re n e w a l   a c t i v i t y   i s 
i n c l u d e d   i n   t h e   l o c a l   s t r a t e g y   a n d   t h e r e 
i s   p a r t i c i p a t i o n   o f   t h e   i n h a b i t a nt s   i n   t h e 
d e v e l o p m e n t   o f   t h e   p r o j e c t ,   t h e r e   i s   n o 
r e a s o n   t o   e x c l u d e   s u c h   p r o j e c t s   f r o m 
Leader f unding.

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I m p l e m e n t i n g   a   c o o p e r a t i o n   p r o j e c t   i s 
more complex than a normal local projec t 
(finding a cooperation par tner, establish-
i n g   a   c o o p e r a t i o n   a g r e e m e n t ,   e a c h   L AG 
h a v i n g   t o   o b t a i n   t h e   g r a n t   f r o m   i t s   o w n 
p ro gra m m e,   e tc. ) .  Th i s   re q u i re s   a   te c h n i-
cal suppor t from the programme author i-
t i e s ,   w h i c h   w a s / i s   u n f o r t u n a t e l y   n o t 
a l ways   p re s e nt   to   a   re a s o n a b l e   e x te nt   i n 
all programmes.

I n   L e a d e r +   a c t i v i t i e s   r e l a t e d   t o   v i s i t s , 
e x c h a n g e s   a n d   c o n f e r e n c e s   c o u l d   b e 
f i n a n c e d   u n d e r   t h e   a c t i o n  ‘c o o p e r a t i o n’. 
V i s i t s   t o   a n o t h e r   L A G   a r e   a   p r e l i m i n a r y 
s t e p   t o   d e v e l o p   a   c o o p e r a t i o n   p r o j e c t . 
T h e   s u b s e q u e n t   e l a b o r a t i o n   o f   a   j o i n t 
a c t i o n ,   w h i c h   i m p l i e s   re a c h i n g   a n   a gre e -
ment, is not always achieved. S ome M em -
b e r   S t ate s   g ave   s p e c i f i c   f u n d i n g   fo r   p re -
parator y ac t ion s.

4 6. 
N e t wo r k i n g   i s   t h e   e l e m e nt   o f   t h e   Le a d e r 
a p p ro a c h   w h i c h   i s   r a t h e r   s t e e re d   b y   t h e 
n a t i o n a l   a n d   E u r o p e a n   n e t w o r k s .   T h e 
i n d i v i d u a l   L A G   m i g h t   t h e r e f o r e   n o t   b e 
a b l e   t o   i n c l u d e   s p e c i f i c   d e t a i l s   a b o u t 
planned net wor k ing ac tivities in its strat -
eg y.

4 8. 
I n   t h e   C o m m i s s i o n’s   v i e w,   t h e   m o s t   r e l-
e v a n t   c r i t e r i o n   t o   d e t e r m i n e   i f   a   p ro j e c t 
sh ould  be  fun ded by Le ad er  is t he  ex tent 
t h a t   i t   c o n t r i b u t e s   t o   t h e   o b j e c t i v e s   o f 
th e loc al development  s trategy. 

As   re g a rd s   d e a d we i g ht,   s e e   a l s o   re p l y   to 
paragraph  10 9.

l a G   i n   f r a n c e   ( P a y s   d e   l a   l o i r e ).   T h e 
C o m m i s s i o n   w i l l   e x a m i n e   i n   d e p t h   t h e 
q u e s t i o n   o f   t h e   s t a r t   o f   p r o j e c t   e l i g i b i l-
i t y   t a k i n g   i n t o   a c c o u n t   t h e   n e e d   f o r   a 
h a r m o n i s e d   a p p ro a c h   a c ro s s   Co m m u n i t y 
funding  u nde r sh ared manageme nt.

42 .
I n n o v a t i o n   i s   a   f e a t u r e   o f   t h e   a x i s ,   b u t 
n o t   m a n d a t o r y   a t   L A G   l e v e l .   T h e   M o n i-
t o r i n g   C o m m i t t e e   o f   t h e   r u r a l   d e v e l-
o p m e n t   p r o g r a m m e   ( R D P )   d e t e r m i n e s 
t h e   w e i g h t   o f   e a c h   L A G   s e l e c t i o n   c r i t e -
r i o n ,   i n c l u d i n g   i n n ovat i o n ,   a f te r   t h e   R D P 
approval (Ar ticle 78(a) of R egulation (EC ) 
N o   1 6 9 8 / 2 0 0 5 ) .   L AG s   a r e   e n c o u r a g e d   t o 
p r e s e n t   i n n o v a t i v e   l o c a l   d e v e l o p m e n t 
s t r a t e g i e s   b u t   i n n o v a t i o n   i s   o n e   L A G 
selec tio n cr iter io n amo ng  oth er s.

T h e   C o m m i s s i o n   h a s   d r a w n   M e m b e r 
S t a t e s ’  a t t e n t i o n   t o   p o t e n t i a l   p r o b l e m s 
w i t h   t h e   i m p l e m e n t a t i o n   o f   i n n o v a-
t i v e   p r o j e c t s   v i a   t h e   Fo c u s   G r o u p   o f   t h e 
L e a d e r   s u b - c o m m i t t e e   o f   t h e   E u r o p e a n 
N e t w o r k   f o r   R u r a l   d e v e l o p m e n t   ( E N R D ) . 
T h e   Fo c u s   G r o u p   t r i e s   t o   g i v e   g u i d a n c e 
o n   h o w   t o   e n s u r e   t h a t   i n n o v a t i o n   c a n 
ta ke p l ace.

45 . 
Le a d e r +   O b s e r vato r y   m o n i to r i n g   s h owe d 
t h at   8 3  %   o f   Le a d e r +   L AG s   we re   i nvo l ve d 
i n   i n t e r - t e r r i t o r i a l   c o o p e r a t i o n   a n d   6 8  % 
in transn at io nal  co o p erat ion .

Par ticipation to net work ing ac tivities and 
c o o p e r a t i o n   p r o j e c t s   i s   t y p i c a l l y   m o r e 
c o m m o n   a m o n g   t h e   m o s t   e x p e r i e n c e d 
L AG s.   N e w   L AG s   a re   m o re   fo c u s e d   o n   t h e 
local implementation of their local devel-
o p m e nt   s t rate g y.   O ve ra l l   m at u r i t y   o f   t h e 
p r o g r a m m e   i s   a l s o   a   f a c t o r   f a c i l i t a t i n g 
net wor k ing  and coop eratio n.

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T h e   C o m m i s s i o n   a g r e e s   t h a t   t h e r e   i s   a 
n e e d   f o r   a   h i g h   d e g r e e   o f   t r a n s p a r e n c y 
a n d   t h e   s u b s e q u e n t   n e e d   fo r   L AG s   to   b e 
a b l e   to   d e m o n s t ra te   t h a t   t h e y   h ave   co n-
sistently  followed proper procedure s.

H owe ve r,   i n   t h e   va s t   m a j o r i t y   o f   M e m b e r 
S t a t e s ,   r u l e s   o n   i n t e r n a l   p r o c e d u r e s   f o r 
d e c i s i o n   t ra n s p a re n c y,   avo i d i n g   co n f l i c t s 
o f   i n t e r e s t   o r   a p p e a l   w e r e   a d o p t e d .  T h e 
Focus Group on the ‘ bottom-up approach’ 
of the Leader sub - committee of the Euro -
pean   Net wor k  for  Rural  D eve lopm ent   h a s 
b e e n   g a t h e r i n g   d i f f e r e n t   t y p e s   o f   s u c h 
p r o c e d u r e s   i n   a   d r a f t   r e p o r t   t h a t   w i l l 
soon  be  m ade available to the  publ ic.

joint reply to paragraphs 57–58:
The Commission will consider revising the 
‘G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e   L e a d e r 
a x i s ’  i n   t h e   s e n s e   o f   f u r t h e r   c l a r i f y i n g 
the respec t of basic pr inciples on projec t 
selec tion (transparenc y, equal treatment, 
u s e   o f   o b j e c t i ve   s e l e c t i o n   c r i t e r i a ,   d e c i-
s i o n   re p o r t i n g )   o n   t h e   b a s i s   o f   t h e   g o o d 
prac tices collec ted.

5 9.
S ee  Com mis sio n reply to paragraph  5 6.

6 0.
S ee  Com mission replies to paragraphs  1 6 
an d 56 .

Ap p ro p r i ate   p ro ce d u re s   a re   n e ce s s a r y   to 
a v o i d   r e a l   c a s e s   o f   c o n f l i c t s   o f   i n t e r e s t . 
T h e   Co m m i s s i o n   w i l l   c o n s i d e r   p ro v i d i n g 
f u r t h e r   g u i d a n ce   o n   r u l e s   fo r   co n f l i c t s   o f 
i n t e re s t   i n   t h e  ‘G u i d e   o n   t h e   a p p l i c a t i o n 
of th e Leader axis’.

joint reply to paragraphs 49–52:
T h e   C o m m i s s i o n   w i l l   e x a m i n e   i n   d e p t h 
t h e   q u e s t i o n   o f   t h e   s t a r t   o f   e l i gi b i l i t y   o f 
projec ts tak ing into account the need for 
a   h a r m o n i s e d   a p p r o a c h   a c r o s s   C o m m u-
nit y fu nding u nder  shared man ag e ment.

B ox  11
S ee  Commis sio n  rep ly to p aragraph  4 9 .

53 . 
I n   t h e   2 0 0 7 – 1 3   p ro gra m m i n g   p e r i o d   i t   i s 
m a n d a t o r y   t o   c h e c k   t h e   r e a s o n a b l e n e s s 
of projec t costs (Ar ticle 26(2)(d) of R egu-
lation  (E C ) No 1 97 5/ 2006).

54 . 
Ta k i n g   i n t o   a c c o u n t   t h e   w i d e   v a r i e t y   o f 
L e a d e r   p r o j e c t s ,   i t   m i g h t   b e   d i f f i c u l t   t o 
j u d g e   a   p r i o r i   f a c t o r s   l i k e   t h e   d e g r e e 
o f   p r o f i t a b i l i t y   a n d   a t   t h e   s a m e   t i m e   t o 
e n s u r e   t h a t   t h e   d e s i r e d   o u t c o m e s   a r e 
achieved.

56 .
T h e   p u b l i c   a u t h o r i t i e s   r e p r e s e n t e d   i n 
t h e   L AG   ( m u n i c i p a l i t i e s ) ,   a n d   w h i c h   re p -
r e s e n t   u p   t o   5 0  %   o f   t h e   L A G   m e m b e r s , 
a r e   t h e m s e l v e s   d e m o c r a t i c a l l y   a c c o u n t -
able. I n addition, LAGs in cer tain M ember 
S t a t e s   a r e   r e c o g n i s e d   a s   p u b l i c   b o d i e s 
(e.g.  in  France ). 

Fu r t h e r m o r e ,   f o r   t h e   c u r r e n t   p r o g r a m-
m i n g   p e r i o d   a cco rd i n g   to   A r t i c l e   6 2 . 2   o f 
R egulation (EC ) No 1698/2005, there is an 
o b l i g a t i o n   fo r   L AG s   to   h ave   t h e   c a p a c i t y 
to administe r p u b lic fu nds.

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6 4. 
O n   a v e r a g e ,   r u n n i n g   c o s t s   a r e   l i m i t e d 
a n d   r e p r e s e n t   1 5  %   o f   t h e   p u b l i c   s u p -
p o r t   t o   t h e   l o c a l   d e v e l o p m e n t   s t r a t e g y. 
This is below the upper limit of 20  % laid 
d ow n   i n   Ar t i c l e   3 8   o f   R e g u l at i o n   ( E C )   N o 
1 97 4/2 00 6.

The existence of local staff in local offices 
does not necessar ily lead to a more rapid 
a s s e s s m e n t   o f   p r o j e c t s .   M o r e o v e r,   t h e 
p r e s e n c e   o f   l o c a l   s t a f f   d o e s   n o t   m a k e 
administrative procedures obsolete; they 
a re   s t i l l   n e e d e d   fo r   s o u n d   f i n a n c i a l   m a n -
age ment.

6 5. 
L o c a l   p r o g r a m m e   d e l i v e r y   a i m s   t o 
i m p rove   i m p l e m e nt at i o n   ( e. g.   b e t te r   t a r -
geting of suppor t, assistance to the bene -
ficiar ies). The proximit y of LAGs assisting 
a n d   i n fo r m i n g   t h e   p o t e n t i a l   b e n e f i c i a r y 
a c c e l e r a t e s   t h e   p r e p a r a t i o n   o f   a p p l i c a -
tion s. 

L A G s ’  t a s k s   d o   n o t   c o r r e s p o n d   t o   a d d i-
t i o n a l   o r   d u p l i c a t e d   t a s k s   b u t   t o   d e l e -
g ate d   t a s k s,   w h i c h   a re   n o t   c a r r i e d   o u t   at 
p ro gra m m e   l e ve l   ( co n t ro l,   p ro j e c t   s e l e c -
t i o n   a n d   p ay m e n t   i n   c e r t a i n   r u r a l   d e ve l-
o p m e n t   p r o g r a m m e s ) .   C o s t s   o f   c o n t r o l s 
r e l a t e d   t o   o n - t h e - s p o t   c h e c k s   c a n   b e 
lowe r wh en per for med by  lo cal e nt it ie s.

T h e r e   i s   i n s u f f i c i e n t   e v i d e n c e   o f   a d d i-
t i o n a l   d e l a y s   r e s u l t i n g   f r o m   t h e   L e a d e r 
method. There are different Leader imple -
m e n t a t i o n   m o d e l s   i n   t h e   E U   i n v o l v i n g 
additional tasks beyond the basic projec t 
s e l e c t i o n   t a s k   ( p r o j e c t   a p p r o v a l   a n d / o r 
p a y m e n t   o f   c l a i m s   i n   3 9   p r o g r a m m e s   i n 
t h e   c u r r e n t   p e r i o d ) .   L AG s   w i t h   f i n a n c i a l 
a n d   a d m i n i s t r a t i v e   a u t o n o m y   h a v e   i n 
ge neral sh or te r proce dure s. 

S e e   a l s o   C o m m i s s i o n   r e p l y   t o   p a r a-
graph 64 .

61 .
S ee  Commis sio n  rep ly to p aragraph  6 0 .

L A G   m e m b e r s   a r e   r e p r e s e n t a t i v e   a n d 
a c t i ve   l o c a l l y   b a s e d   o rg a n i s at i o n s   o f   t h e 
r u ra l   te r r i to r y.   I t   i s   t h e re fo re   n o r m a l   t h at 
a   p r o p o r t i o n   o f   p r o j e c t s   a r e   o r i g i n a t i n g 
from these organisations. Excluding these 
p ro j e c t s   wo u l d   co n s t i t u te   a   m a j o r   o b s t a-
c l e   fo r   t h e   s u cce s s f u l   i m p l e m e n t a t i o n   o f 
the  local  devel op ment  s t rategy.

H o w e v e r ,   M e m b e r   S t a t e s   d o   h a v e   t o 
e n s u re   t h a t   t h e re   i s   n o   c o n f l i c t   o f   i n t e r -
est. 

B ox  13
Th e   Co m m i s s i o n   a g re e s   o n   t h e   p r i n c i p l e 
t h a t   m e m b e r s   o f   t h e   d e c i s i o n   m a k i n g 
c o m m i t t e e   s h o u l d   n o t   t a k e   p a r t   i n   t h e 
decision-mak ing in situations where they 
h a v e   a  ‘s h a r e d   i n t e r e s t ’  w i t h   t h e   p r o j e c t 
promoter. 

S e e   a l s o   Co m m i s s i o n   re p l y   t o   p a r a g r a p h 
60 .

B ox  14
T h e   C o m m i s s i o n   a g r e e s   w i t h   t h e   C o u r t 
t h a t   t h e r e   s h o u l d   b e   c l e a r   r u l e s   o n   c o n-
f l i c t   o f   i n t e r e s t s ,   w h i c h   s h o u l d   b e   f o l-
l o w e d   a s   r e g a r d s   t h e   d e c i s i o n   t o   f u n d   a 
projec t.

63 .
L e a d e r +   h a s   b e e n   i m p l e m e n t e d   i n 
1 5  M e m b e r   S t a t e s   a n d   a   L e a d e r +   t y p e 
measure in six additional M ember States. 
T h e   i m p l e m e n t a t i o n   m o d e l s   u s e d   i n   t h e 
M ember St ates var y signific antl y.

T h e   q u a l i t y   o f   a   s t r a t e g y   ( t a rg e t i n g,   p r i-
o r i t i e s ,   m o n i t o r i n g   a n d   e v a l u a t i o n )   c a n 
a s   s u c h   n o t   a vo i d   s i t u a t i o n s   o f   c o n f l i c t s 
o f   i n t e r e s t .   T h e   C o m m i s s i o n   a l r e a d y 
re p l i e d   u n d e r   t h e   p re v i o u s   p o i n t s   ( 5 6   t o 
6 1 )   a s   r e g a r d s   t h e   n e c e s s i t y   o f   r u l e s   o n 
c o n f l i c t s   o f   i n t e re s t   a t   L AG   l e ve l   a s   p a r t 
o f   t h e   i m p l e m e nt at i o n   m e c h a n i s m   o f   t h e 
strateg y.

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7 0. 
S e e   Co m m i s s i o n   re p l i e s   t o   p a r a g r a p h   6 4 
an d to t he subsequent subhead ing. 

Th e   Co m m i s s i o n   i s   aw a re   o f   c a s e s   w h e re 
t h e   a p p l i c a t i o n   r e q u i r e m e n t s   s e t   b y   t h e 
M e m b e r   S t a t e s   d o   n o t   c o r r e s p o n d   t o   a 
r e a s o n a b l e   r a t i o   b e t w e e n   t h e   s i z e   o f   a 
p ro j e c t   a n d   t h e   n e e d   fo r   a c c o u n t a b i l i t y. 
M e m b e r   S t a t e s   h a v e   a l r e a d y   r a i s e d   t h e 
i s s u e   i n   t h e   c u r re nt   p ro gra m m i n g   p e r i o d 
a n d   t o g e t h e r   w i t h   t h e   C o m m i s s i o n   a r e 
j o i n t l y   l o o k i n g   fo r   a p p ro p r i a te   s o l u t i o n s 
to t he se c ases. 

T h e   C o m m i s s i o n   i s   a l s o   s u p p o r t i n g 
t h e   e x c h a n g e   o f   g o o d   p r a c t i c e s   i n   t h i s 
re s p e c t,   n o t a b l y   i n   t h e   f ra m e wo r k   o f   t h e 
L e a d e r   s u b - c o m m i t t e e   o f   t h e   E u r o p e a n 
N et wor k  for  Rural D evelopm ent.

H owe ve r,   t h e   Co m m i s s i o n   a n d   t h e   M e m-
ber States have to ensure the sound man-
a g e m e nt   o f   p ro gra m m e   i m p l e m e nt at i o n , 
w h i c h   l e a d s   i n e v i t a b l y   t o   a   c e r t a i n   l e ve l 
of adm inistrat ive burden at  L AG level.

B ox 1 5
laG in Hungar y. During Leader+ (Leader+ 
t y p e   m e a s u re )   t h e   i m p l e m e nt at i o n   o f   t h e 
Le a d e r   a p p r o a c h   w a s   c o m p l e t e l y   n e w   i n 
Hungar y.

66 . 
I n   L e a d e r +   t h e r e   w a s   n o   o b l i g a t i o n   t o 
d i s t i n g u i s h   a n i m a t i o n   f r o m   a d m i n i s t r a -
t i ve   co s t s.   I n   t h e   c u r re n t   p e r i o d   t h i s   d i f-
f e r e n t i a t i o n   h a s   t o   b e   d o n e .   T h e r e   i s   a 
d e f i n i t i o n   o f   a n i m a t i o n   a n d   a c q u i s i t i o n 
o f   s k i l l s   i n   t h e  ‘G u i d e   o n   t h e   a p p l i c a t i o n 
o f   t h e   Le a d e r   a x i s’  w h i c h   w i l l   b e   f u r t h e r 
cla r ified.

67 . 
Th e   o b s e r vat i o n s   i n   p a ra gra p h   6 7   s h o u l d 
be seen in the light of the positive exam -
p l e   o n   o p e r a t i n g   c o s t s   m e n t i o n e d   i n 
para grap h 68.

H u n g a r i a n   L A G s   o p e r a t i n g   u n d e r   t h e 
L e a d e r +   t y p e   m e a s u r e   2 0 0 4 – 0 6   w e r e 
m o r e   f o c u s e d   o n   c a p a c i t y - b u i l d i n g ,   t h e 
Le a d e r   a p p ro a c h   b e i n g   n e w   i n   t h i s   co u n -
tr y. 

69 . 
M e m b e r   S t a t e s   d e c i d e   o n   t h e   c o n c r e t e 
r e s p o n s i b i l i t i e s   o f   L A G s   a c c o r d i n g   t o 
t h e   p r i n c i p l e   o f   s u b s i d i a r i t y ,   a d a p t -
i n g   t h e m   t o   t h e i r   a d m i n i s t r a t i v e   s y s t e m 
a n d   p r a c t i c e.  T h e r e   a r e   d i f fe r e n t   Le a d e r 
i m p l e m e nt at i o n   m o d e l s   i n   t h e   E U   i nvo l v -
i n g   a d d i t i o n a l   t a s k s   f o r   L A G s   b e y o n d 
t h e   b a s i c   p ro j e c t   s e l e c t i o n   t a s k   ( p ro j e c t 
a p p rova l   a n d / o r   p ay m e nt   o f   c l a i m s   i n   3 9 
p ro gra m m e s   i n   t h e   c u r re nt   p ro gra m m i n g 
per iod) . 

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71 .
S ee Com mission  rep lies  to  p aragraph s  6 4 
to 70 .

Apar t from the decision of M ember States 
o n   t h e   co n c re te   re s p o n s i b i l i t i e s   o f   L AG s, 
the processing of files by a LAG has to be 
seen in the light of the capacit y-building 
p ro ce s s.  Th e   m o re   p o s s i b i l i t i e s   t h e   M e m-
b e r   S t a t e s   o f f e r   t o   t h e   L A G s   i n   t e r m s   o f 
t r a i n i n g,   t h e   e a s i e r   t h e   i n t e r a c t i o n   w i t h 
the  au tho r it ies w il l  g et.

The Commission and M ember States were 
n o t   s u f f i c i e n t l y   d e m a n d i n g   a n d   s h a r e 
s o m e   r e s p o n s i b i l i t y   w i t h   t h e   L A G s   f o r 
l i m i t i n g   t h e   p o te nt i a l   a d d e d   va l u e   o f   t h e 
L e a d e r   a p p r o a c h .   T h e y   h a v e   n o t   t a k e n 
s u f f i c i e n t   a c t i o n   t o   l i m i t   t h e   c o s t s   a n d 
r isks

F o r   t h e   c u r r e n t   p r o g r a m m i n g   p e r i o d 
2 0 0 7 – 1 3 ,   t h e   n e c e s s a r y   l e g a l   p r o v i s i o n s 
have been included in the EAFRD 7 regula-
tion and it s imp l ementing  ru l es.

7  European Agricultural Fund for Rural Development.

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Fu r t h e r m o r e ,   t h e   C o m m i s s i o n   h a s   p r o -
v i d e d   g u i d a n c e   t o   M e m b e r   S t a t e s   i n   t h e 
phase of programme design and approval 
t h ro u g h   t h e  ‘G u i d e   o n   t h e   a p p l i c at i o n   o f 
t h e   L e a d e r   a x i s ’.   T h i s   i n c l u d e d   s p e c i f i c 
a d v i c e   o n   t h e   p o t e n t i a l   a d d e d   v a l u e   o f 
Le a d e r,   i . e.   c o ve r a g e   o f   a l l   a xe s,   i n n o v a -
tion , integrated and  ter r itor ial appro ac h. 

I n   a d d i t i o n ,   t h e   C o m m i s s i o n   r e q u e s t e d 
a   s t r a t e g i c   a p p r o a c h   t o w a r d s   L e a d e r 
under the national strategic plans. At the 
s a m e   t i m e,   M e m b e r   S t a t e s   we re   a l l o we d 
t o   m a k e   d i f f e r e n t   c h o i c e s   a s   r e g a r d s 
t h e   s c o p e   o f   a p p l i c a t i o n   o f   t h e   L e a d e r 
m e t h o d   i n   re s p o n s e   to   t h e   s p e c i f i c   ex i s t-
i n g   e x p e r i e n c e   a t   L A G   l e v e l   a n d   t o   t h e 
n eeds identif ied  in the ir analyses.

The Commission contr ibutes on an ongo -
i n g   b a s i s   t o   b e t t e r   p r o c e d u r e s   f o r   t h e 
m a n a g e m e n t   a n d   c o n t ro l   s y s t e m s   i n   t h e 
M e m b e r   S t a t e s   t h ro u g h   t h e   p ro v i s i o n   o f 
a d v i c e   a n d   g u i d a n c e,   a s   we l l   a s   t h ro u g h 
r e c o m m e n d a t i o n s   s t e m m i n g   f r o m   i t s 
a u d i t s   a n d   w h e r e   a p p r o p r i a t e   b y   a p p l y -
in g fin ancial cor rec tions.

T h e   C o m m i s s i o n   w i l l   c o n t i n u e   t o   t a k e 
t h e   n e c e s s a r y   i n i t i a t i v e s   t o   i m p r o v e   t h e 
i m p l e m e n t a t i o n   o f   t h e   L e a d e r   m e t h o d 
i n   t h e   l i g h t   o f   a l l   e l e m e n t s   p r o v i n g   t h i s 
n eed.

S e e   a l s o   C o m m i s s i o n   r e p l i e s   t o   p a r a-
gra p h   7   a n d   to   t h e   h e a d i n g   b e fo re   p a ra-
graph 65 . 

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72 . 
T h e   a d d e d   v a l u e   o f   L e a d e r   i s   s t r o n g l y 
influenced by the programme author ities 
w h o s e   m a i n   r e s p o n s i b i l i t y   i s   t o   d e f i n e 
r u l e s   a d a p te d   to   t h e   Le a d e r   a p p ro a c h ,   to 
t ra i n   L AG s   to   a cq u i re   t h e   n e ce s s a r y   s k i l l s 
a n d   t o   e n c o u r a g e   t h e m   t o   u s e   a l l   t h e 
Leader p o te nt ial. 

T h e   L e a d e r   a x i s   r e q u i r e s   i n   p a r t i c u l a r 
s p e c i f i c   e l i gi b i l i t y   r u l e s   to   a l l ow   s u p p o r t 
t o   i n n o v a t i v e,   i n t e g r a t e d   a n d   t e r r i t o r i a l 
projec t s.

7 3. 
T h e   s o u n d   f i n a n c i a l   m a n a g e m e n t   f o r 
L e a d e r   a s   a   w h o l e   i s   a   k e y   p r i n c i p l e   t o 
b e   o b s e r v e d .   T h e   C o m m i s s i o n   e x e c u t e d 
a u d i t s   o n   3 7   o u t   o f   7 3   L e a d e r +   p r o -
g r a m m e s   f o r   t h e   p r o g r a m m i n g   p e r i o d 
2 0 0 0 – 0 6 .   T h e   C o m m i s s i o n   i s   a u d i t i n g 
L e a d e r +   a n d   L e a d e r   m e a s u r e s   i n   t h e 
framework of its overall audit programme, 
t a k i n g   i n t o   a c c o u n t   t h e i r   s p e c i f i c   r i s k s , 
m a k i n g   r e c o m m e n d a t i o n s   w h e r e   n e c e s -
sar y and applying financial cor rec tions in 
j us tified c ases. 

T h e   c o n t e x t   i n   w h i c h   L e a d e r   w a s   a n d   i s 
b e i n g   i m p l e m e n t e d   h a s   e v o l v e d   s i n c e 
2 0 0 0   n o t   t h e   l e a s t   d u e   t o   t h e   d i f f e r e n t 
design of the implementation throughout 
the different funding periods. This in turn 
i m p l i e s   t h a t   m a n y   M e m b e r   S t a t e s   h a v e 
h a d   t o   a d a p t   t h e i r   a d m i n i s t r a t i v e   s t r u c -
ture for  t he implementat ion  of Lea de r. 

T h e   C o m m i s s i o n   w i l l   c o n t i n u e   t o   t a k e 
t h e   n e c e s s a r y   i n i t i a t i v e s   t o   i m p r o v e   t h e 
i m p l e m e n t a t i o n   o f   t h e   L e a d e r   m e t h o d 
i n   t h e   l i g h t   o f   a l l   e l e m e n t s   p r o v i n g   t h i s 
n eed.

T h e   Co m m i s s i o n   a n d   t h e   M e m b e r   S t a t e s 
( m a n a g i n g   a u t h o r i t y   a n d   L A G   l e v e l )   a r e 
i n   t h e   c u r re n t   p e r i o d   u n d e r t a k i n g   a   s i g-
n i f i c a n t   re v i e w   t o   b e t t e r   d e f i n e   t h e   ro l e 
o f   t h e   L A G s ,   t h e   r o l e   o f   c a p a c i t y - b u i l d-
i n g ,   t h e   e l i g i b i l i t y   c r i t e r i a   a n d   a   m o r e 
clear repar tition of the tasks bet ween the 
m a n a gi n g   a u t h o r i t i e s   a n d   t h e   L AG s.  Th i s 
p r o c e s s   i s   c a r r i e d   o u t   i n   a   c o n s t r u c t i v e 
a n d   co o p e rat i ve   way   i n   t h e   f ra m e wo r k   o f 
the European Net wor k for Rural D evelop -
m e n t   ( f o c u s   g r o u p s   o f   t h e   L e a d e r   s u b -
commit tee).

A number of programme author ities have 
a l r e a d y   p r o p o s e d   s u b s t a n t i a l   a m e n d-
m e n t s   t o   t h e   d e s i g n   o f   t h e   L e a d e r   a x i s 
i n   t h e i r   r u r a l   d e v e l o p m e n t   p r o g r a m m e s 
( t h r o u g h   R D P   m o d i f i c a t i o n s ) .   T h e s e 
include improvements to the deficiencies 
o b s e r ve d   by   t h e   Co u r t   i n   t h e   r u ra l   d e ve l-
opment  p ro grammes au dited.

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8 0. 
Th e   p re p a rat i o n   o f   a   n e w   f u n d i n g   p e r i o d 
h a d   t o   s t a r t   w h i l e   t h e   t a k e - u p   o f   t h e 
i m p l e m e n t a t i o n   o f   t h e   L e a d e r +   p r o -
gra m m e s   a n d   Le a d e r +   t y p e   m e a s u re   wa s 
s t i l l   n o t   ve r y   a d v a n c e d   i n   m a ny   M e m b e r 
States.

I n   a d d i t i o n   t o   t h i s ,   t h e   e x p e r i e n c e   o f 
m a i n s t r e a m i n g   a n   i n n o v a t i v e   C o m m u-
n i t y   i n i t i a t i v e   w a s   c o m p l e t e l y   n e w   f o r 
t h e   Co m m i s s i o n   a n d   t h e   M e m b e r   S t a te s. 
The mainstreaming of Leader is a process 
t h at   re d u ce s   t h e   Co m m i s s i o n’s   i n f l u e n ce 
o n   t h e   p ro gra m m e   co nte nt   a n d   w h e re   at 
p ro gra m m e   m a n a g e m e nt   l e ve l   a   s p e c i f i c 
e x p e r i m e n t a l   l o c a l   a p p r o a c h   h a s   t o   c o -
exist  with  st andard common  r ule s.

Th e   Co m m i s s i o n   i s   a t t e n t i ve l y   a c c o m p a-
ny i n g   t h e   d e b ate   i n   t h i s   re s p e c t   t h ro u g h 
i t s   p a r t i c i p a t i o n   i n   t h e   m o n i t o r i n g   c o m-
m i t te e s,   t h e   R u ra l   D e ve l o p m e nt   Co m m i t-
t e e   a n d   t h r o u g h   t h e   E u r o p e a n   N e t w o r k 
for Rural Development (ENRD). One of the 
m a i n   t a s k s   o f   t h e   E N R D   i n   t h i s   re s p e c t   i s 
to learn the lessons from the mainstream-
i n g,   i d e n t i f y i n g   t h e   o b s t a c l e s   a n d   g o o d 
prac tice.

8 1. 
A s   r e g a r d s   r u n n i n g   c o s t s   a n   u p p e r   l i m i t 
of 20  % of the public suppor t to the local 
d e ve l o p m e nt   s t rate g y   h a s   b e e n   i n c l u d e d 
i n   t h e   l e g i s l a t i o n   f o r   t h e   c u r r e n t   p r o -
g r a m m i n g   p e r i o d ,   b a s e d   o n   t h e   l e s s o n s 
lear n ed f rom t he past  per iods a nd tak ing 
i n to   a cco u n t   t h e   d i f fe re n t   Le a d e r   i m p l e -
mentation models. 

76 . 
On 14 Apr il 2000, the Commission, ac ting 
i n   a cco rd a n ce   w i t h   Ar t i c l e   2 1 ( 1 )   o f   R e g u-
l a t i o n   ( E C )   N o   1 2 6 0 / 1 9 9 9 ,   l a i d   d o w n   t h e 
g u i d e l i n e s   d e s c r i b i n g   i n   d e t a i l   t h e   a i m s, 
scope and me thod o f imp l ementat ion  for 
the Leader+ rural development initiative. 
Th e s e   g u i d e l i n e s   we re   u s e d   a s   re fe re n ce 
d o c u m e n t s   f o r   t h e   a p p r o v a l   o f   t h e   p r o -
gramme s.

77 . 
Th e   f a c t   t h at   a   M e m b e r   St ate   h a s   n o t   s e t 
r e q u i r e m e n t s   f o r   s o m e   s p e c i f i c   a s p e c t s 
d o e s   n o t   a u to m at i c a l l y   l e a d   to   a   l a x   p e r-
for mance of the LAG. There are LAGs who 
set these requirements at the level of the 
local strategy implementation, ensuring a 
good per for mance without a high degree 
o f   c o n t r o l   f r o m   t h e   m a n a g i n g   a u t h o r i-
ties. 

Th e   Co m m i s s i o n   w i l l   gi ve   m o re   g u i d a n ce 
i n   o r d e r   t o   a d d r e s s   t h e   r i s k s   r e fe r r e d   t o 
by t he  Co ur t. 

78 . 
S ee  Commis sio n  rep ly to p aragraph  4 9 .

79 . 
T h e   C o m m i s s i o n   a g r e e s   w i t h   t h e   C o u r t 
t h at   e f fo r t s   h ave   to   b e   d o n e   o n   t h e   q u a l-
it y of  t he  lo c al devel o p ment  strate gie s.

T h e   m o n i t o r i n g   a n d   a s s e s s m e n t   o f   t h e 
a c h i e ve m e nt   o f   L AG s’  s t rate gi e s   i s   a   s e n -
s i t i ve   p o i n t   i n   s o m e   M e m b e r   S t a t e s.  T h e 
r o o t   m i g h t   b e   f o u n d   i n   t h e   d i s t i n c t i v e -
n e s s   o f   L e a d e r   c o m p a r e d   t o   t r a d i t i o n a l 
implementat io n meth ods. 

T h e   C o m m i s s i o n   w i l l   g i v e   m o r e   s p e c i f i c 
g u i d a n c e   t o   M e m b e r   S t a t e s   o n   h o w   t o 
b e t t e r   m o n i t o r,   a s s e s s   a n d   i m p r o v e   t h e 
L A G s ’  s t r a t e g i e s   a n d   t h e i r   r e s p e c t i v e 
achievements.

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8 2. 
The European Net wor k for Rural D evelop -
ment (ENRD) is a driving force for the effi-
c i e n t   i m p l e m e n t a t i o n   o f   t h e   r u ra l   d e ve l-
opment polic y and to enhance the overall 
per for mance of the Leader axis. The Com-
m i s s i o n   b e l i e ve s   t h a t   t h e   n e t wo r k   i s   t h e 
most appropriate tool to achieve progress 
t h r o u g h   a n a l y s i s ,   e x c h a n g e   o f   i n f o r m a-
tion, identification of good prac tices and 
e v a l u a t i o n   s u p p o r t i n g   a c t i v i t i e s   (A r t i c l e 
6 7 of R egulation ( EC ) N o 1 6 98/2 0 0 5 ) .

8 3. 
Th e   Co m m i s s i o n   i s   c a r r y i n g   o u t   co nt i n u-
ous wor k with the M ember States namely 
t h ro u g h   t h e   Eu ro p e a n   N e t wo r k   fo r   R u r a l 
D e v e l o p m e n t   ( s e e   C o m m i s s i o n   r e p l i e s 
t o   p a r a g r a p h s   7 2   a n d   8 0 ) .  w h e r e   a p p r o -
p r i a t e ,   i t   w i l l   u n d e r t a k e   a d d i t i o n a l   i n i-
t i a t i v e s   i n   o r d e r   t o   f u r t h e r   i m p r o v e   t h e 
impleme nt ation of Leader.

8 4. 
A r t i c l e s   6 3 ( a )   a n d   6 4   o f   R e g u l a t i o n   ( E C ) 
N o   1 6 9 8 / 2 0 0 5   s t a t e   t h a t   t h e   s u p p o r t 
gra nte d   u n d e r   t h e   Le a d e r   a x i s   s h o u l d   b e 
fo r   t h e   i m p l e m e nt at i o n   o f   l o c a l   d e ve l o p -
m e nt   s t rate gi e s   w i t h   a   v i e w   to   a c h i e v i n g 
the objec tives of one or more of the three 
o t h e r   a xe s.   Ar t i c l e   6 4   o f fe r s   t h e   p o s s i b i l-
i t y   t o   u s e   t h e   e l i g i b i l i t y   c r i t e r i a   o f   t h e 
pre - defined measures on the scope of eli-
gible projec ts, but it was not intended to 
l i m i t   t h e   a p p l i c a t i o n   t o   t h e   p r e - d e f i n e d 
m e a s u re s.  Th e   re s t r i c t i o n   t o   m a i n s t re a m 
m e a s u r e s   i n   c e r t a i n   r u r a l   d e v e l o p m e n t 
p r o g r a m m e s   r e p r e s e n t s   i n   f a c t   a   p o t e n -
t i a l   l i m i t at i o n   o f   t h e   p o s s i b i l i t i e s   o f fe re d 
b y   Le a d e r   fo r   i n n o v a t i v e   a n d   i n t e g r a t e d 
projec ts.

E l i g i b l e   c o s t s   a r e   d e f i n e d   i n   A r t i-
c l e s   5 9   a n d   6 3 ( c )   o f   R e g u l a t i o n   ( E C )   N o 
1 6 9 8 / 2 0 0 5 .   I n   a d d i t i o n ,   Po i n t   5 . 3 . 4 . 3   o f 
Annex II of R egulation (EC ) No 1974/2006 
f o r e s e e s   t h a t   r u r a l   d e v e l o p m e n t   p r o -
grammes must provide an indicative esti-
m a t e   o f   e x p e n d i t u r e   w h i c h   w i l l   b e   u s e d 
f o r   r u n n i n g   c o s t s ,   s k i l l s   a c q u i s i t i o n   a n d 
a n i m a t i o n ,   a l l ow i n g   a   f i n a n c i a l   m o n i to r-
ing of  the se co sts.

R u n n i n g   c o s t s   a r e   l i n k e d   t o   t h e   b a s i c 
a d m i n i s t r a t i o n   a n d   t h e   f i n a n c i a l   m a n-
a g e m e n t   o f   t h e   p r o g r a m m e   a n d   s h o u l d 
b e   c l e a r l y   s e p a rate d   f ro m   a n i m at i o n   a n d 
a cq u i s i t i o n   o f   s k i l l s   a c t i v i t i e s.   Acco rd i n g 
t o   t h e  ‘ G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e 
Leader axis’ animation requires additional 
re s o u rc e s   a n d   c o m m u n i c a t i o n   s k i l l s   d i s-
t i n c t   f ro m   t h o s e   n e e d e d   fo r   t h e   f i n a n c i a l 
an d ad minist rat ive fu nc t ion s.

Fo r   t h e   c u r r e n t   p e r i o d ,   a n d   d e s p i t e   t h e 
2 0  %   ce i l i n g,   o n   ave ra g e   o n l y   1 5 %   o f   t h e 
p u b l i c   s u p p o r t   f o r   l o c a l   d e v e l o p m e n t 
strategies  has  b een   p rogrammed   for   r un-
nin g cos ts. 

T h e   C o m m i s s i o n   w i l l   c o n s i d e r   f u r t h e r 
clar ifying the exac t demarcation bet ween 
r u n n i n g   c o s t s   a n d   a n i m a t i o n   c o s t s   a n d 
gi v i n g   a d d i t i o n a l   g u i d a n ce   o n   t h e   a p p l i-
c at i o n   o f   t h e   p r i n c i p l e   o f   re a s o n a b l e n e s s 
t h r o u g h   a n   u p d a t e   o f   t h e  ‘G u i d e   o n   t h e 
applicat ion o f th e Leader axis’.

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Le a d e r   i s   ava i l a b l e   a s   a   to o l   fo r   t h e   t h re e 
axes in the major it y of the rural develop -
m e n t   p ro g r a m m e s.   O n l y   2 1   p ro g r a m m e s 
o u t   o f   9 0   c o n f i n e   t h e m s e l v e s   t o   t h e 
impleme nt ation of Axis  3.

B ox 1 7
T h o u g h   i t   i s   t r u e   t h a t   t h e   p o s s i b i l i t i e s 
t o   i m p r o v e   t h e   c o m p e t i t i v e n e s s   o f   t h e 
o l i v e   a n d   w i n e   s e c t o r s   c o u l d   b e   p o t e n-
t i a l l y   r e s t r i c t e d ,   i t   i s   p o s s i b l e   v i a   A x i s   3 
t o   s u p p o r t   f o r   e x a m p l e   t h e   d i v e r s i f i c a-
t i o n   o f   n o n - a gr i c u l t u r a l   a c t i v i t i e s   l i n k e d 
t o   t h e s e   s e c t o r s   a s   w e l l   a s   t o   g i v e   s u p -
por t for the creation and development of 
m i c r o - e n t e r p r i s e s .   S o m e   e n v i r o n m e n t a l 
a c t i v i t i e s   a r e   e l i g i b l e   w i t h i n   t h e   m e a s-
ures of Axis 3.

S e e   a l s o   C o m m i s s i o n   r e p l y   t o   p a r a-
graph 85 .

8 6. 
P r o g r a m m e   m o d i f i c a t i o n s   a r e   p o s s i b l e 
i n   o r d e r   t o   b e t t e r   t a k e   i n t o   a c c o u n t   t h e 
n eeds of Lead er.

S e e   a l s o   C o m m i s s i o n   r e p l i e s   t o   p a r a-
graph s 8 4 an d 85 .

S i n c e   l a t e   2 0 0 9   s e v e r a l   M e m b e r   S t a t e s 
s e e k   t o   a m e n d   t h e i r   p r o g r a m m e s   t o 
i m p r o v e   t h e   e f f e c t i v e   i m p l e m e n t a t i o n 
o f   t h e   Le a d e r   m e t h o d   b y   a l l o w i n g   m o r e 
f l e x i b i l i t y   t h a n k s   t o   t h e   i n t r o d u c t i o n   o f 
i nte grate d   o r   s p e c i a l   m e a s u re s.  To   a   co n-
siderable ex tent, this is a consequence of 
the discussions animated by the Commis-
s i o n   i n   t h e   f ra m e wo r k   o f   t h e   Le a d e r   s u b -
c o m m i t t e e   o f   t h e   E u r o p e a n   N e t w o r k   fo r 
Ru ral D evel op ment.

I t should also be under lined that eligibil-
i t y   o f   o p e rat i o n s   o u t s i d e   t h e   m e a s u re s   i s 
applied  in o th er M em b er States. 

T h e   C o m m i s s i o n   w i l l   c o n s i d e r   a d j u s t -
i n g   t h e   l e g a l   f r a m e w o r k   f o r   t h e   c u r -
r e n t   p e r i o d   i f   n e e d e d   o r   r e v i e w i n g   t h e 
‘G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e   L e a d e r 
a x i s’  to   i m p rove   g u i d a n ce   to   t h e   M e m b e r 
St ate s   a s   re g a rd s   f u n d i n g   o f   ( i n n ovat i ve ) 
projec t s  o ut side  the meas ure c at alog ue.

85 .
M e m b e r   S t a t e s   w e r e   a l l o w e d   t o   m a k e 
d i f f e r e n t   c h o i c e s   a s   r e g a r d s   t h e   s c o p e 
o f   a p p l i c a t i o n   o f   t h e   L e a d e r   m e t h o d   i n 
re s p o n s e   t o   t h e   s p e c i f i c   e x i s t i n g   e x p e r i-
e n ce   at   L AG   l e ve l   a n d   to   t h e   n e e d s   i d e n-
tified in t heir an al ys es.

T h e   m a i n s t r e a m i n g   a p p r o a c h   o p e n s 
L e a d e r   t o   a l l   a x e s .   M e m b e r   S t a t e s   c a n 
choose to limit Leader to Axis 3. However, 
the scope of Axis 3 is ver y wide. I t covers 
b o t h   q u a l i t y   o f   l i f e   a n d   t h e   w h o l e   r u r a l 
e c o n o m y   o u t s i d e   t h e   a g r i c u l t u r a l   a n d 
fo re s t r y   a c t i v i t i e s.   I n   a d d i t i o n ,   m e a s u re s 
re l ate d   to   t h e   o b j e c t i ve s   o f   A xe s   1   a n d   2 
a r e   n o t   a l w a y s   n e c e s s a r y   t o   a c h i e v e   t h e 
objec tives  o f t he l ocal  st rategy. 

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

88 . 
A   c o m p e t i t i v e   s e l e c t i o n   p r o c e d u r e   i s 
s u p p o r t e d   b y   t h e   p r e s e n c e   o f   q u a l i t a-
t i v e   s e l e c t i o n   c r i t e r i a   i n   a d d i t i o n   t o   t h e 
m i n i m a l   e l i g i b i l i t y / e x c l u s i o n   c r i t e r i a   i n 
M e m b e r   S t a t e s ’  p r o g r a m m e s .   Q u a l i t a-
t i v e   s e l e c t i o n   c r i t e r i a   o n   t h e   h o m o g e -
n e i t y   a n d   c o n t e n t   o f   s t r a t e g i e s   a l l o w   a 
c o m p a r a t i v e   a s s e s s m e n t   b e t w e e n   t h e 
applications without being exclusive and 
a l l o w i n g   a   b r o a d   r a n g e   o f   g r o u p s   t o   b e 
s e l e c te d.  Th e   Co m m i s s i o n   i n   t h e   co nte x t 
o f   t h e   p ro g r a m m e   a p p rov a l   c h e c k e d   t h e 
l i s t   o f   o b j e c t i ve   s e l e c t i o n   c r i te r i a   i n c l u d -
i n g   t h e   p re s e n ce   o f   q u a l i t at i ve   s e l e c t i o n 
cr iter ia.

89 . 
LAGs have to meet the m inimu m requi re -
m e n t s   s e t   o u t   i n   A r t i c l e   6 2 . 1 ( a )   o f   R e g u-
l a t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5   a s   r e g a r d s   t h e 
c o n t e n t   o f   t h e   l o c a l   d e v e l o p m e n t   s t r a t -
e g y.   O n   t o p   o f   t h e s e   m i n i m u m   r e q u i r e -
m e nt s,   p r i o r i t y   i s   gi ve n   to   s e ve ra l   Le a d e r 
f e a t u r e s   ( e . g .   r e l e v a n c e   o f   t h e   s t r a t e g y 
towa rd s   t h e   a re a ,   q u a l i t y   o f   p a r t n e r s h i p, 
i n n o v a t i o n ) ,   w h i c h   s h o u l d   a l s o   e n s u r e   a 
cer ta in  qual it y l evel.

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B ox 1 8
I n France, LAGs are selec ted by a regional 
s e l e c t i o n   co m m i t te e,   c h a i re d   by   t h e   Pre -
f e c t   a n d   t h e   R e g i o n a l   P r e s i d e n t .   T h e i r 
d e c i s i o n s   a r e   b a s e d   o n   t h e   a n a l y s i s   o f 
a n   e x p e r t   c o m m i t t e e.   I n   s o m e   c a s e s   t h e 
q u a l i t y   o f   s o m e   L A G s ’  p r o p o s i t i o n s   a r e 
f i r s t l y   q u a l i f i e d   a s   i n s u f f i c i e n t ,   b u t   a f te r 
s p e c i f i c   g u i d a n c e   a n d   s u p p o r t ,   t h e y   a r e 
i m p rove d   a n d   f i n a l l y   a cce p te d.  Th i s   p ro -
c e s s   i s   f u l l y   i n   l i n e   w i t h   t h e   h o r i z o n t a l 
r u r a l   d e v e l o p m e n t   p r i o r i t y   o f   i m p r o v -
i n g   g ove r n a n ce 8  a n d   t h e   e n co u ra g e m e nt 
b y   t h e   Co m m i s s i o n   t o   M e m b e r   S t a t e s   t o 
l o c a l   p a r t n e r s h i p   c a p a c i t y ,   a n i m a t i o n 
a n d   p r o m o t i n g   s k i l l s   a c q u i s i t i o n ,   w h i c h 
c a n   h e l p   m o b i l i s e   l o c a l   p o t e n t i a l,   w h i c h 
is par t of the Communit y strategic guide -
line s.

9 0. 
T h e   d e t a i l e d   s e l e c t i o n   p r o c e d u r e   i s 
d e f i n e d   a t   n a t i o n a l   l e v e l   i n   l i n e   w i t h 
t h e   s u b s i d i a r i t y   p r i n c i p l e .   T h e   M e m b e r 
State has to decide, af ter having received 
p r o p o s a l s ,   o n   t h e   n e e d   t o   r e q u i r e   t h e 
i m p r o v e m e n t   o f   t h e   s t r a t e g i e s .   I n   c e r -
tain M ember States/regions the selec tion 
w a s   o r g a n i s e d   i n   t w o   r o u n d s   t o   a l l o w 
n e w   L A G s   a   l o n g e r   t i m e   p e r i o d   t o   p r e -
pare the strategy or those rejec ted in the 
f i r s t   ro u n d   t o   p re s e n t   a n   i m p rove d   l o c a l 
d e v e l o p m e n t   s t r a t e g y   ( e . g .   S l o v a k i a ; 
 DE -B avar ia) .

8  Fourth priority of the Community strategy guidelines for the 
programming period 2007 to 2013 as set out in Council Decision 

2006/144/EC of 20 February 2006: ‘The resources devoted to 

Axis 4 (Leader) should (…) also play an important role in the 

horizontal priority of improving governance and mobilising the 

endogenous development potential of rural areas.’

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9 2. 
B e y o n d   t h e   l e g a l   r e q u i r e m e n t s   m e n-
t i o n e d   i n   p a r a g r a p h   9 1 ,   t h e   Co m m i s s i o n 
a l s o   a t t a c h e d   i m p o r t a n c e   t o   a d d i t i o n a l 
qualitat ive cr iter ia.

H owe ve r,   i n   a   s ys te m   o f   s h a re d   m a n a g e -
ment, the application of such cr iter ia is a 
respon sibilit y   of   t he  program me   a ut ho r i-
ties  at M ember State  level.

The value of the local development strat -
egy is to be assessed in the concrete local 
contex t o f a sp ecific rural area. 

I n   a d d i t i o n ,   t h e   C o m m i s s i o n   w i l l   a s s e s s 
t h e   p o s s i b i l i t i e s   t o   i m p r o v e   t h e   e x i s t -
i n g   s t r a t e g i e s   i n   t h e   l i g h t   o f   t h e   s h a r e d 
management concept and M ember States’ 
responsib il ities.

91 . 
Th e   a c t i v i t i e s   u n d e r   t h e   Le a d e r   a x i s   h ave 
been approved by the Commission on the 
b a s i s   o f   t h e   l e g a l   re q u i re m e n t s   a s   s t i p u-
l a t e d   b y   R e g u l a t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5 
a n d   o f   t h e   C o m m u n i t y   s t r a t e g i c   g u i d e -
l i n e s   d e f i n i n g   t h e   C o m m u n i t y   p r i o r i t i e s 
for rural  deve lo p ment p o l ic y. 

I n the contex t of the programme approval 
t h e   C o m m i s s i o n   h a s   e x a m i n e d   t h e   k e y 
e l e m e nt s   fo re s e e n   i n   A n n e x   2   o f   R e g u l a-
t i o n   ( E C )   N o   1 9 7 4 / 2 0 0 6 9.   H owe ve r,   o t h e r 
a d d i t i o n a l   m a n a g e m e n t   e l e m e n t s   o f 
L e a d e r   h a d   t o   b e   d e f i n e d   b y   t h e   m a n-
a g i n g   a u t h o r i t i e s   a f t e r   t h e   p r o g r a m m e 
approval. 

9 

Regulation (EC) No 1974/2006 establishes clear obligations 

to be respected by the Commission for the approval of rural 

development programmes: 
—   procedure and timetable for selecting the local action 

groups, including objective selection criteria and planned 

indicative number of local action groups and planned 

percentage of rural territories covered by local development 

strategies;

—   justification for selection of areas whose population falls 

outside the limits set out in Article 37(3) of Regulation (EC) 

No 1974/2006;

—   procedure for the selection of operations by the local action 

groups,

—   description of the financial circuits applicable for local 

action groups;

—  inter-territorial and transnational cooperation;
—   procedure, timetable and objective criteria to select inter-

territorial and transnational cooperation projects;
—   running the local action group, acquiring skills and 

animating the territory;

—   limit to apply on the share of the local action group budget 

for running the local action groups;

—   indicative estimate of expenditure under Article 59(a) to (d) 
of Regulation (EC) No 1698/2005 which will be used for skills 

acquisition and animation for the Leader axis.

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93 . 
T h e   C o m m i s s i o n   d o e s   n o t   s h a r e   t h e 
Co u r t ’s   a s s e s s m e n t .  T h e   a c t i v i t i e s   u n d e r 
t h e   L e a d e r   a x i s   h a v e   b e e n   a p p r o v e d   b y 
t h e   Co m m i s s i o n   o n   t h e   b a s i s   o f   t h e   l e g a l 
r e q u i r e m e n t s   a s   s t i p u l a t e d   b y   R e g u l a-
t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5   a n d   o f   t h e   Co m-
m u n i t y   s t rate gi c   g u i d e l i n e s   d e f i n i n g   t h e 
C o m m u n i t y   p r i o r i t i e s   f o r   r u r a l   d e v e l o p -
ment polic y. I n doing so, the Commission 
e x a m i n e d   t h e   k e y   e l e m e n t s   f o r e s e e n   i n 
Annex 2 of Regulation (EC ) No 1974/2006. 
S e e   a l s o   t h e   C o m m i s s i o n   r e p l y   t o   p a r a-
graph 91.

Th e   Co m m i s s i o n   h a s   e v i d e n ce   t h at   s o m e 
M e m b e r   S t a t e s   h a v e   o r   a r e   i m p r o v i n g 
t h e i r   r u r a l   d e v e l o p m e n t   p r o g r a m m e s   t o 
e n h a n c e   t h e   e f f e c t i v e   i m p l e m e n t a t i o n 
o f   t h e   Le a d e r   m e t h o d   b y   a l l o w i n g   m o r e 
f l e x i b i l i t y   t h a n k s   t o   t h e   i n t r o d u c t i o n   o f 
i nte grate d   o r   s p e c i a l   m e a s u re s.  To   a   co n-
s i d e r a b l e   e x t e n t ,   t h i s   i s   a   c o n s e q u e n c e 
o f   t h e   d i s c u s s i o n s   w i t h i n   t h e   E u r o p e a n 
N e t w o r k   fo r   R u r a l   D e v e l o p m e n t   a n d   t h e 
Le a d e r   fo c u s   gro u p s   c re ate d   o n   t h e  ‘ b o t -
tom-up  ap p roach’ and ‘innovat io n’.

F o r   e x a m p l e ,   F r a n c e   p r o p o s e d   i n   J u n e 
2 0 1 0   a   n e w   s u b - m e a s u r e   f o r   L e a d e r   t o 
i nte grate   p ro j e c t s   t h at   d i d   n o t   f a l l   u n d e r 
the  exis ting  measu re. 

T h e   C o m m i s s i o n   a n d   M e m b e r   S t a t e s 
c a n n o t   d e m o n s t r a t e   t h e   a d d e d   v a l u e 
a c h i e ve d   f ro m   i m p l e m e n t i n g   t h e   Le a d e r 
approac h  and  have  not  yet  evaluate d  th e 
addit ional costs and  r is ks  involve d

L e a d e r   w a s   a n   i n n o v a t i v e   a p p r o a c h   f o r 
w h i c h   l i m i t e d   e v a l u a t i o n   t o o l s   e x i s t e d 
o r i g i n a l l y.   O v e r   t i m e   t h e   m e t h o d s   u s e d 
h ave   e vo l ve d,   p a r t l y   d u e   to   t h e   Co m m i s-
s i o n’s   a c t i v i t i e s,   a n d   t h e y   co nt i n u e   to   d o 
so. Cer tainly fur ther improvement is pos-
s i b l e ,   a n d   t h e   C o m m i s s i o n   i s   c u r r e n t l y 
f i n a l i s i n g   a   wo r k i n g   p a p e r 1 0  o n   a s s e s s i n g 
t h e   i m p a c t s   o f   Le a d e r,   b u t   p re v i o u s   e va l-
u a t i o n s   h a v e   h i g h l i g h t e d   t h e   c o n t r i b u-
t i o n   a n d   i d e nt i f i e d   i m p a c t s   o f   Le a d e r.   An 
ex-p ost evaluation of Leader+ is cur rently 
being under taken by an ex ter nal contrac -
tor.

E v a l u a t i o n   o f   t h e   a d d i t i o n a l   c o s t s   i s 
included in the scope of programme eval-
u a t i o n s ;   e v a l u a t i o n   l o o k s   a t   t h e   r e s u l t s 
and impac ts of programmes — by assess -
i n g   i n t e r   a l i a   t h e i r   e f f i c i e n c y   ( b e s t   r e l a -
t i o n s h i p   b e t w e e n   r e s o u r c e s   e m p l o y e d 
and results achieved). The abilit y of eval-
uator s to do this  in respe c t  of Le ade r  has 
b e e n   c o n t i n u a l l y   d e v e l o p i n g   a s   i n n o v a-
tive me thodologies  are develo ped. 

R e q u i r e m e n t s   c o n c e r n i n g   t h e   c o m p o s i-
t i o n   a n d   o p e n n e s s   o f   L AG s,   b e yo n d   w h at 
i s   i m p o s e d   i n   A r t i c l e   6 2 . 1 ( b )   o f   R e g u l a-
tion (EC ) No 1698/2005, have to be lef t to 
t h e   M e m b e r   St ate s   gi ve n   t h e   d i ve r s i t y   o f 
LAG  le gal  o r su p p or t ing s tru c tu re s. 

S e e   a l s o   C o m m i s s i o n   r e p l y   t o   p a r a-
graph 6.

10  Capturing impacts of Leader and of measures to improve 
quality of life in rural areas, Draft working Paper 4, 21 June 2010, 

European Evaluation Network for Rural Development.

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9 7. 
T h e   d i f f i c u l t y   t o   o b t a i n   s u f f i c i e n t   d a t a 
under Leader II was taken into account in 
t h e   e l a b o r a t i o n   o f   t h e   Le a d e r +   m o n i t o r -
in g dat a.

As for the cur rent per iod, the basic infor-
m a t i o n   i s   b e i n g   p r o v i d e d   t h r o u g h   t h e 
C o m m o n   M o n i t o r i n g   a n d   E v a l u a t i o n 
Fr a m e w o r k   ( C M E F ) .   Fu r t h e r m o r e ,   a n   e x -
p o s t  e v a l u a t i o n   o f   L e a d e r +   i s   c u r r e n t l y 
ong oing  (see  re ply  to paragraph   96 ). 

I n   a d d i t i o n ,   t h e   Co m m i s s i o n   h a s   re ce nt l y 
fin alised a fin al draf t wor k ing paper  wi th 
g u i d a n c e   t o   M e m b e r   S t a t e s   a n d   e v a l u a-
t o r s   o n   h o w   t o   s p e c i f i c a l l y   i m p r o v e   t h e 
a s s e s s m e n t   o f   t h e   i m p a c t   o f   L e a d e r   i n 
r ural areas.

94 . 
T h e   C o m m i s s i o n   a g r e e s   w i t h   t h i s 
a p p ro a c h ,   w h i c h   i s   a l re a d y   b e i n g   i m p l e -
m e n t e d .   Fo r   t h e   2 0 0 7 – 1 3   p e r i o d   L e a d e r 
is mainstreamed, therefore Leader ac tivi-
t i e s   a re   i n c l u d e d   i n   t h e   a n n u a l   p ro g re s s 
re p o r t s   (A P R s ) ,   a n d   t h e   m o n i to r i n g   i n d i-
c a t o r s   i n c l u d e   t h e   o u t p u t   o f   a c t i v i t i e s 
i m p l e m e nte d   t h ro u g h   Le a d e r.  Th e   e va l u -
a t i o n   s y s t e m   i n   p l a c e   fo r   r u r a l   d e v e l o p -
ment programmes also covers Leader. The 
p o s s i b i l i t y   t o   c o m p l e m e n t   t h e   C o m m o n 
M onitor ing and Evaluation Framewor k by 
i n d i c ato r s   at   n at i o n a l   l e ve l   i s   u n d e r   co n-
sideratio n.

96 . 
O n e   o f   t h e   k e y   f i n d i n g s   o f   t h e   m i d - t e r m 
e v a l u a t i o n   w a s   t h a t   i t   w a s   t o o   e a r l y   a 
s t a g e   i n   t h e   p r o g r a m m i n g   p r o c e s s   t o 
i d e n t i f y   i m p a c t s   r e s u l t i n g   f r o m   L e a d e r. 
M any LAGs had just star ted to implement 
their  st rate gies.

A n   e x - p o s t  e v a l u a t i o n   o f   Le a d e r +   i s   n o w 
being under taken by an ex ter nal contrac -
to r.  Th i s   w i l l   a s s e s s   t h e   i m p a c t s   a c h i e ve d 
ove r   t h e   w h o l e   p ro gra m m i n g   p e r i o d.  Th e 
f i n a l   r e p o r t   s h o u l d   b e   a v a i l a b l e   b e f o r e 
the  end  of  20 10 .

…   b u t   t h e r e   i s   l i t t l e   e v i d e n c e   o n   t h e 
e f f e c t i v e n e s s   o f   L e a d e r   p r o g r a m m e s   i n 
achieving rural development objec tives or 
the added value of the Leader approach

A s   m e n t i o n e d   a b o v e ,   w h e n   t h e   Le a d e r + 
m i d - t e r m   e v a l u a t i o n   w a s   c a r r i e d   o u t , 
m a n y   i n d i v i d u a l   L A G   p r o g r a m m e s   w e r e 
a t   a   ve r y   e a r l y   s t a g e   o f   i m p l e m e n t a t i o n . 
T h i s   e v a l u a t i o n   c o n c e n t r a t e d   t h e r e f o r e 
o n   t h e   e s t a b l i s h m e n t   o f   Le a d e r + ,   s e l e c -
t i o n   o f   L A G s ,   e t c .   T h e   o n g o i n g   e x - p o s t 
e v a l u a t i o n   i s   e x p e c t e d   t o   p r o v i d e   i n fo r -
mation on the effec tiveness of Leader+ in 
r e l a t i o n   t o   o b j e c t i v e s   a n d   o n   t h e   a d d e d 
value o f th e Leader ap p ro ac h.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

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1 00 . 
T h e   e v i d e n c e ,   w h i l s t   n o t   e x h a u s t i v e , 
sh ould  not be cons idere d as  insuf fi ci ent.

T h e   m i d - t e r m   e v a l u a t i o n   r e p o r t s   f o r 
Le a d e r +   d o   n o t   i n d i c ate   t h at   t h e   m e t h o d 
i t s e l f   i s   n o t   e f f e c t i v e ,   b u t   t h a t   f a c t o r s 
linked to the way it is implemented influ-
e n c e   t h e   f i n a l   s u c c e s s   o r   f a i l u r e   o f   t h e 
l o c a l   p ro gra m m e.  wh e re   t h e   m e t h o d   wa s 
implemented effec tively, positive impac ts 
h a v e   b e e n   i d e n t i f i e d .   A g a i n ,   i t   m u s t   b e 
remembered that Leader, as an innovative 
approach to unlock local potential, would 
n a t u r a l l y   h a v e   s u c c e s s e s   a n d   f a i l u r e s   i n 
i m p l e m e n t a t i o n ,   a n d   t h a t   t h e   v a l u e   o f 
t h e   a p p ro a c h   l i e s   n o t   o n l y   i n   m e a s u r i n g 
t h e   s u c c e s s e s ,   b u t   i n   t a k i n g   a c c o u n t   o f 
th e reason s for failures  in the  f ut ure.

1 02 . 
S ee Commission replies to paragraphs 97, 
9 9 an d 1 00 .

1 03 . 
M o n i t o r i n g   a n d   e v a l u a t i o n   s h o u l d   t a k e 
into account the costs of implementation 
a n d   m a n a g e m e nt,   a n d   a s s e s s   t h e    ove ra l l 
s u c c e s s   o r   f a i l u r e   o f   t h e   L A G   s t r a t e g y. 
L e a d e r   w o u l d   h a v e   s u c c e s s e s   a n d   f a i l-
u r e s   a t   p r o j e c t   i m p l e m e n t a t i o n   l e v e l .   I t 
would  be  impo ssible  to  id ent ify   an d   s up -
p o r t   t h e  ‘ h i g h - f l y i n g’  i n n ovat i ve   p ro j e c t s 
i f   o n l y   l ow- r i s k   p ro j e c t s   we re   s u p p o r te d ; 
t h e r e f o r e   a   c e r t a i n   p r o p o r t i o n   o f   f a i l e d 
p ro j e c t s   i s   i n e v i t a b l e,   a n d   n o t   a n   i n d i c a-
tion of systematic failure. Success or fail-
u r e   s h o u l d   t h e r e f o r e   b e   j u d g e d   a t   L A G 
strateg y level.

T h e s e   i s s u e s   a r e   r e f e r r e d   t o   a t   v a r i o u s 
p o i n t s   i n   t h e   e v a l u a t i o n s   ( s e e   C o m m i s -
sion  replie s to paragraph s 9 4  to 1 02 ) .

98 .
M o n i t o r i n g   a n d   e v a l u a t i o n   o f   s o c i o e c o -
n o m i c   p o l i c i e s   h a s   b e e n   c o n t i n u o u s l y 
e v o l v i n g   s i n c e   t h e   e s t a b l i s h m e n t   o f   t h e 
S t r u c t u r a l   Fu n d s .   A   s i g n i f i c a n t   s t e p   f o r -
w a rd   fo r   t h e   2 0 0 7 – 1 3   r u r a l   d e ve l o p m e n t 
polic y was the establishment of the Com-
m o n   M o n i t o r i n g   a n d   E v a l u a t i o n   Fr a m e -
wo r k   (C M E F ) ,   w h i c h   fo r   t h e   f i r s t   t i m e   c re -
a t e d   a   c o n s i s t e n t   f r a m e w o r k   t o   b e   u s e d 
b y   a l l   M e m b e r   S t a t e s .   Fo r   t h e   2 0 0 7 – 1 3 
p e r i o d ,   L e a d e r   h a s   b e e n   m a i n s t r e a m e d , 
i . e .   i s   n o   l o n g e r   i m p l e m e n t e d   t h r o u g h 
s e p a r a t e   p r o g r a m m e s ,   b u t   i s   a n   o b l i g a-
tor y component of the rural development 
p ro g r a m m e s   ( R D Ps ) ,   i n c o r p o r a t e d   a s   t h e 
fo u r t h   a x i s   o f   a l l   p ro gra m m e s.   I t   i s   t h e re -
fo re   s u b j e c t   to   t h e   s a m e   i m p l e m e nt at i o n 
rules, and monitor ing and evaluation sys-
t e m ,   a s   a l l   o t h e r   E U - f u n d e d   r u r a l   d e v e l-
o p m e nt   a c t i v i t i e s.  Th e   f i r s t   re s u l t s   o f   t h e 
i m p l e m e nt at i o n   o f   t h e   C M E F   c a n   b e   s e e n 
in the annual progress repor ts (APRs), and 
the first infor mation relating to impac t of 
the programmes will be provided with the 
m i d - te r m   re p o r t s   d u e   to   b e   s u b m i t te d   to 
the Commission by 31 D ecember 2010.

99 . 
T h e   m i d - t e r m   e v a l u a t i o n s   f o r   L e a d e r + 
w e r e   c a r r i e d   o u t   a t   a   s t a g e   i n   t h e   p r o -
g r a m m e   l i f e   c y c l e   w h e r e   i t   w a s   t o o 
e a r l y   i n   m a n y   c a s e s   t o   i d e n t i f y   e c o -
n o m i c   i m p a c t .   T h i s   e v a l u a t i o n   c o n c e n -
t r a t e d   t h e r e f o r e   o n   t h e   e s t a b l i s h m e n t 
o f   L e a d e r + ,   s e l e c t i o n   o f   L A G s ,   e t c .   T h e 
c u r r e n t l y   o n g o i n g   e x - p o s t  e v a l u a t i o n 
o f   Le a d e r +   i s   e x p e c t e d   t o   p r o v i d e   m o r e 
i n fo r m a t i o n   o n   t h e   a g g r e g a t e   i m p a c t   o f 
the  programme t hroug ho ut  it s l ife t ime.

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t h e   o f f e r s ,   i t   s h o u l d   b e   b o r n e   i n   m i n d 
that the LAGs as a rule request more than 
one offer, but have not always taken care 
i n   p ro d u c i n g   e v i d e n ce   o f   t h e s e   co m p a r i-
s o n s .   H o w e v e r,   t h e   i n s t r u c t i o n s   f o r   t h e 
p ro j e c t s   o f   t h e   L AG s   t h e m s e l ve s   a l re a d y 
re q u i re   t h a t   t h e   g e n e r a l   r u l e s   fo r   p u b l i c 
t e n d e r i n g   f o r   s m a l l   a m o u n t s   a r e   c o m-
p l i e d   w i t h   a n d   t h a t   f o r   a m o u n t s   a b o v e 
2 0 0   0 0 0  e u r o   n a t i o n a l   l a w   D L   1 9 7 / 1 9 9 9 
( s t i p u l at i n g   t h e   r u l e s   fo r   p u b l i c   p ro c u re -
m e n t   o f   s e r v i ce s )   i s   re s p e c te d.   H owe ve r, 
t h e s e   i n s t r u c t i o n s   t o   t h e   L A G s   w i l l   b e 
r e i n f o r c e d .’  O n   t h e   b a s i s   o f   t h e   M e m b e r 
S t a t e   r e p l y   t h e   C o m m i s s i o n   c o n c l u d e d 
t h a t   t h e re   w a s   n o   i m m e d i a te   r i s k   fo r   t h e 
fund and decided not to apply a financial 
cor rec t ion.

1 07 . 
T h e   C o m m i s s i o n   a c k n o w l e d g e s   t h a t   i n 
s o m e   c a s e s   t h e   d o c u m e n t a t i o n   o f   t h e 
c h e c k s   w a s   w e a k .   H o w e v e r,   w e a k   d o c u-
m e n t a t i o n   d o e s   n o t   i m p l y   a u t o m a t i c a l l y 
th at  no c heck s have been  execu ted.

10 5. 
T h e   C o m m i s s i o n   e x e c u t e d   a u d i t s   o n   3 7 
o u t   o f   7 3   L e a d e r +   p r o g r a m m e s   f o r   t h e 
p r o g r a m m i n g   p e r i o d   2 0 0 0 – 0 6 ;   1 3   p r o -
g r a m m e s   h a v e   b e e n   a u d i t e d   m o r e   t h a n 
once. 

wi t h   re g a rd   t o   Le a d e r +   Fr a n c e,   a f t e r   t h e 
2 0 0 5   a u d i t   a   f o l l o w - u p   a u d i t   w a s   e x e -
c u t e d   i n   2 0 0 6 .   T h e   i s s u e s   t h a t   h a d   b e e n 
a d d r e s s e d   d u r i n g   t h e   2 0 0 5   a u d i t   a n d   t o 
w h i c h   t h e   C o u r t   r e f e r s   h a v e   i n d e e d   n o t 
been followed up by a financial correc tion 
s i n ce   t h e re   we re   n o   d i re c t   i n d i c a t i o n s   o f 
financial  loss  to  the  fund.  A  financial  cor -
r e c t i o n ,   h o w e v e r,   i s    u n d e r   w a y   f o r   t h i s 
p r o g r a m m e   d u e   t o   c o n t r o l   d e f i c i e n c i e s 
a s   r e g a r d s   i m p l e m e n t a t i o n   o f   A r t i c l e   4 
( a d m i n i s t r a t i v e   a n d   o n - t h e - s p o t   c h e c k s ) 
and Ar ticle 9 (paying author it y checks) of 
R egulation (EC ) No 438/2001.

A s   r e g a r d s   t h e   a u d i t   i n   P o r t u g a l ,   t h e 
C o m m i s s i o n   m a d e   s o m e   r e c o m m e n d a-
t i o n s   i n   i t s   l e t t e r   o f   f i n d i n g s   i n   2 0 0 5   fo r 
i m p r o v e m e n t   o f   t h e   c o n t r o l   s y s t e m   a s 
r e g a r d s   t h e   i s s u e s   ‘c o n f l i c t   o f   i n t e r e s t 
a n d  ‘re a s o n a b l e n e s s   o f   p ro p o s e d   p ro j e c t 
c o s t s ’.   T h e   Po r t u g u e s e   a u t h o r i t i e s   w e r e 
r e c o m m e n d e d   t o   e n s u r e   t h a t   s p e c i f i c 
p r o v i s i o n s   b e   i n t r o d u c e d   i n   t h e   L A G ’s 
p r o c e d u r a l   r u l e s   c o n c e r n i n g   p o s s i b l e 
c o n f l i c t   o f   i n t e r e s t s .   T h e   M e m b e r   S t a t e 
r e p l i e d   a s   r e g a r d s   t h e   c o n f l i c t   o f   i n t e r -
e s t   i s s u e :  ‘ Th e   n e w   i n s t r u c t i o n s   i s s u e d   i n 
J u n e   2 0 0 6   a l r e a d y   p r o v i d e   t h a t   a n y o n e 
h av i n g   a   p e r s o n a l   i nte re s t   i n   a   c a s e   m u s t 
a b s t a i n   f ro m   vo t i n g.   A s   re g a rd s   a p p l i c a-
tions involving third par ties, who are not 
p a r t   o f   t h e   d e c i s i o n a l   u n i t   b u t   m e m b e r s 
of th e L AG , it  is not d eemed  nece ss ar y  to 
a p p l y   t h i s   r u l e   s i n c e   t h e   d e c i s i o n a l   u n i t 
is considered to be independent and con-
s i s t s   o f   s e ve ra l   m e m b e r s.’  As   re g a rd s   re a-
s o n a b l e n e s s   o f   c o s t s   t h e   f o l l o w i n g   w a s 
r e c o m m e n d e d :  ‘ B a s e d   o n   t h e   p r i n c i p l e s 
o f   s o u n d   f i n a n c i a l   m a n a g e m e n t   ( a s   p ro -
v i d e d   f o r   i n   A r t i c l e   3 8 ( 1 )   o f   R e g u l a t i o n 
(EC ) No 1260/99), it is recommended that 
s e v e r a l   o f f e r s   ( e . g .   t h r e e )   b e   r e q u e s t e d 
( e. g.   a b ove   a   ce r t a i n   a m o u nt   o f   ex p e n d i-
ture) and/or that pr ices declared be com-
p a r e d   w i t h   s t a n d a r d   r e f e r e n c e   p r i c e s , 
w h i c h   s h o u l d   b e   d o c u m e nte d.’ Th e   M e m-
b e r   S t ate   re p l i e d   a s   fo l l ows :  ‘Co n ce r n i n g 

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

10 8. 
T h e   C o m m i s s i o n   w i l l   c o n s i d e r   r e v i s-
i n g   t h e  ‘G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e 
Leader axis’ so as to provide fur ther guid-
a n c e   o n   g o o d   p r a c t i c e   i n   t h e s e   re s p e c t s 
in the fut u re.

10 9.
T h e   o n g o i n g   e x - p o s t   e v a l u a t i o n   o f 
L e a d e r +   i s   a d d r e s s i n g   d e a d w e i g h t .   T h i s 
i s   a n   i s s u e   b e s t   a s s e s s e d   e x - p o s t   o n   t h e 
b a s i s   o f   s u r ve y s   a n d   c o m p a r a t i ve   a n a l y -
s i s,   a n d   i s   n o t   d e p e n d e n t   o n   m o n i to r i n g 
d a t a   c o l l e c t e d   d u r i n g   t h e   p e r i o d   ( s e e 
Cour t  fo ot note 34).

I n   re s p e c t   o f   Co u r t   fo o t n o te   3 3 ,   t h e   f a c t 
t h a t   a   p ro j e c t   m i g h t   h ave   g o n e   a h e a d   i n 
t h e   a b s e n c e   o f   Le a d e r   f u n d i n g   d o e s   n o t 
imply that it would necessar ily have been 
e q u a l l y   s u cce s s f u l   w i t h o u t   t h e   b e n e f i t   o f 
the advice and suppor t provided through 
the  Le ader proces s.

St i l l,   i t   i s   i n   p ra c t i ce   q u i te   o f te n   ve r y   d i f-
f i c u l t   to   p re d i c t   i f   t h e   p ro j e c t   co u l d   h ave 
b e e n   re a l i s e d   w i t h o u t   s u p p o r t .  Th i s   m ay 
b e   d e p e n d e nt   o n   s p e c i f i c   c h a ra c te r i s t i c s 
i n h e r e n t   t o   t h e   p r o j e c t .   A   r e a s o n a b l e 
ratio bet ween the r isk of deadweight and 
t h e   s p e c i f i c i t i e s   o f   a   p ro j e c t   wo u l d   n e e d 
to be  fo u nd.

11 0.
Following the identification of some spe -
c i f i c   p r o b l e m s   ( n o t   s y s t e m a t i c )   r e l a t e d 
t o   t r a n s p a re n c y,   t h e   Le a d e r   I I   f i n a l   e v a l-
u a t i o n   r e p o r t   ( p .   2 4 6 )   r e c o m m e n d e d 
i n c re a s e d   t ra i n i n g   a n d   c l e a re r   g u i d e l i n e s 
for LAGs  on  t his  is su e.

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B ox 1 9
f i r s t   e x t r a c t .  T h e   a c t u a l   b a l a n c e   o f 
p o w e r   w i t h i n   t h e   L A G   i s   d e t e r m i n e d   b y 
t h e   l o c a l   a n d   re gi o n a l   c u l t u ra l   a n d   i n s t i -
tution al contex t.

T h e   r i s k   t h a t   L A G s   m a y   b e   d o m i n a t e d 
b y   t h e   i n s t i t u t i o n a l   s e c t o r   i s   c o n s i d e re d 
i n   A r t i c l e   6 2 ( 1 ) b   o f   R e g u l a t i o n   ( E C )   N o 
1 6 9 8 / 2 0 0 5   w h i c h   r e q u i r e s   t h a t   a t   l e a s t 
5 0  %   o f   t h e   l o c a l   p a r t n e r s h i p   m u s t   b e 
c o m p o s e d   o f   e c o n o m i c   a n d   s o c i a l   p a r t -
n ers, civil societ y,  etc.

T h i s   c o n d i t i o n   i s   a   m a j o r   a c h i e v e m e n t , 
h av i n g   i n   m i n d   t h e   i m p o r t a n ce   o f   p u b l i c 
m atc h i n g   f u n d i n g   i n   t h e   i m p l e m e nt at i o n 
of Lea der.

s e c o n d   e x t r a c t .  T h e   m i d - t e r m   e v a l u a -
t i o n s   f o r   L e a d e r +   w e r e   c a r r i e d   o u t   a t   a 
s t a g e   i n   t h e   p ro gr a m m e   l i fe   c yc l e   w h e re 
i t   w a s   t o o   e a r l y   i n   m a ny   c a s e s   t o   a s s e s s 
t h e   m a n a g e m e n t   i s s u e s   m e n t i o n e d   b y 
t h e   C o u r t .   M i d - t e r m   e v a l u a t i o n   r e p o r t s 
are likely to concentrate on issues ar ising 
d u r i n g   t h e   e a r l y   s t a g e s   o f   i m p l e m e n t a-
t i o n ,   s o   i t   i s   p e r h a p s   n o t   s u r p r i s i n g   t h a t 
i s s u e s   s u c h   a s   b u re a u c ra c y   a n d   t h e   l e ve l 
o f   a u t o n o my,   a n d   t h e i r   i m p a c t   o n   e f fe c -
t i v e   i m p l e m e n t a t i o n   e m e r g e   s t r o n g l y   i n 
t h e s e   re p o r t s.  Th e   c u r re n t l y   o n g o i n g   e x -
p ost evaluation of Leader+ is expec ted to 
p r o v i d e   m o r e   i n f o r m a t i o n   o n   t h e   m o r e 
fun damental management issu es.

At the same time one of the focus groups 
of the European Net wor k for Rural D evel-
o p m e n t   ( E N R D )   L e a d e r   s u b - c o m m i t t e e 
i s   d i s c u s s i n g   t h e   r o l e   o f   t h e   d e c i s i o n -
m a k i n g   c o m m i t t e e s   i n   p r o g r a m m e   m a n-
a g e m e n t   a n d   o t h e r   i s s u e s   l i n k e d   t o 
t h e   i m p l e m e n t a t i o n   o f   t h e   b o t t o m - u p 
a p p r o a c h   i n   t h e   c u r r e n t   p r o g r a m m i n g 
p e r i o d .   T h e   o u t c o m e s   w i l l   a l s o   b e   d i s-
c u s s e d   w i t h   t h e   M e m b e r   S t a t e s   i n   t h e 
R u r a l   D e v e l o p m e n t   C o m m i t t e e   ( R D C )   i n 
o rd e r   to   re a c h   t h e   d e s i re d   i m p a c t   fo r   t h e 
impleme nt ation of th e  Leader  approac h .

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E x p l i c i t   c o m p r e h e n s i v e   g u i d e l i n e s   o n 
h o w   t o   e s t a b l i s h   a n d   u s e   t h e   C M E F   s y s-
t e m   h a v e   b e e n   p r o v i d e d   t o   t h e   M e m b e r 
States. Fur ther more, there is a per manent 
dialogue with them to improve the CMEF. 
T h i s   i s   i n   p a r t i c u l a r   f o l l o w e d   u p   i n   t h e 
E u r o p e a n   E v a l u a t i o n   N e t w o r k   f o r   R u r a l 
D e v e l o p m e n t   w h i c h   i n c l u d e s   M e m b e r 
S t a t e s ’  e x p e r t s   a n d   w h i c h   i s   s u p p o r t e d 
b y   a   h e l p d e s k   w o r k i n g   p e r m a n e n t l y   o n 
evaluat ion-re lated iss ues.

T h e   b a s e l i n e   i n d i c a t o r   f o r   L e a d e r   i s   t h e 
s h a r e   o f   p o p u l a t i o n   c o v e r e d   b y   t h e   L AG 
t o   m e a s u r e   t h e   g o v e r n a n c e   o b j e c t i v e 
( l o c a l   c a p a c i t y   t o   e l a b o r a t e   a n d   i m p l e -
m e n t   l o c a l   d e v e l o p m e n t   s t r a t e g i e s )   a s 
l a i d   d o w n   b y   t h e   C o m m u n i t y   s t r a t e g i c 
guidelin es.

O ther CMEF Leader indicators are limited 
i n   l i n e   w i t h   t h e   a p p r o a c h   t a k e n   o f   s i m-
plifying the monitor ing system compared 
t o   L e a d e r +   a n d   i n c l u d i n g   L e a d e r   i n   t h e 
o v e r a l l   a p p r o a c h .  T h e   Le a d e r +   m o n i t o r -
i n g   i n d i c a to r s   we re   n u m e ro u s   co m p a re d 
to   t h o s e   a p p l y i n g   to   t h e   Le a d e r   a x i s,   b u t 
w e r e   o n   t h e   o t h e r   h a n d   n o t   r e l a t e d   t o 
t h e   o v e r a l l   E U   p o l i c y   o b j e c t i v e s   f o r   t h e 
2 00 0–0 6  pe r io d.

I n   g e n e ra l,   i m p a c t s   a re   a s s e s s e d   t h ro u g h 
th e evaluation proces s.

For the gover nance objec tive, monitor ing 
indicators can provide a useful input, but 
a re   n o t   s u f f i c i e nt   to   e va l u ate   t h i s   o b j e c -
t i v e .   T h a t   i s   o n e   o f   t h e   r e a s o n s   w h y   a 
guidance paper on captur ing the impac ts 
o f   Le a d e r 1 1  h a s   b e e n   d e ve l o p e d.   I t   re fe r s 
to governance inter alia on pp. 26–29 and 
4 9–5 0  inc ludin g  proposed  impac t  i ndi ca-
tor s.

The  effec tiveness  and added val ue  of  th e 
L e a d e r   a p p r o a c h   a r e   a s s e s s e d   t h r o u g h 
evaluation. The LAGs’ direc t running costs 
t h a t   a r e   c o v e r e d   b y   Le a d e r   p u b l i c   f u n d-
in g are k n own and  collec ted. 

11  See footnote 3 of the Commission replies.

11 1. 
Please see replies and comments to para-
graphs  64–71.

T h e   e x - p o s t  e v a l u a t i o n   o f   L e a d e r +   w i l l 
a s s e s s   t h e   e f f i c i e n c y   a n d   e f f e c t i v e n e s s 
o f   t h e   v a r i o u s   i m p l e m e n t a t i o n   s y s t e m s 
u s e d   by   M e m b e r   S t a t e s   ( w h i c h   i n t e r   a l i a 
place different burdens on LAGs, and will 
t h e r e f o r e   a f f e c t   t h e   o p e r a t i n g   c o s t s ) . 
T h e  ‘e x c e s s i v e   b u r e a u c r a c y ’  r e f e r r e d   t o 
i n   t h e   s y n t h e s i s   o f   t h e   m i d - t e r m   e v a l u-
a t i o n s   r e f e r s   t o   t h e   p r o g r a m m e   m a n -
a g e m e n t   s y s t e m s   i m p o s e d   b y   t h e   p r o -
gra m m e   a u t h o r i t i e s   w h i c h   i n   s o m e   c a s e s 
w e n t   c o n s i d e r a b l y   b e y o n d   t h e   i n t r i n s i c 
requ irement s o f t he Leader met h od.

11 2.
L e s s o n s   f r o m   t h e   p r e v i o u s   e v a l u a t i o n s 
o f   Le a d e r   co nt r i b u te   to   t h e   n e e d s   o f   c u r -
rent programmes. The cur rent monitor ing 
i n d i c a t o r s   c o r r e s p o n d   t o   a n   a d a p t a t i o n 
o f   t h e   p re v i o u s   i n d i c ato r s   a n d   a re   b a s e d 
o n   t h e   h i e ra rc hy   o f   o b j e c t i ve s   t h at   h e l p s 
to   a n a l ys e   a n d   co m m u n i c ate   p ro gra m m e 
o b j e c t i v e s   a n d   s h o w s   h o w   l o c a l   i n t e r -
ve nt i o n s   s h o u l d   co nt r i b u te   to   t h e   g l o b a l 
strategic o bje c tives.

11 3.
T h e   L e a d e r +   m i d - t e r m   e v a l u a t i o n   s y n-
t h e s i s   r e p o r t   p r o p o s e d   e s t a b l i s h i n g   a n 
 E U - w i d e   s e t   o f   c o m m o n   i n d i c a t o r s,   s u b -
s t a nt i a l l y   re d u c i n g   t h e   n u m b e r   o f   e va l u -
a t i o n   q u e s t i o n s ,   p r o v i d i n g   g u i d a n c e   o n 
m e t h o d s   f o r   m o n i t o r i n g   t h e   i n d i c a t o r s , 
a n d   e s t a b l i s h i n g   t h e   e v a l u a t i o n   f r a m e -
w o r k   t h r o u g h   a   c o n s u l t a t i v e   w o r k i n g 
g r o u p .   A l l   o f   t h e s e   r e c o m m e n d a t i o n s 
w e r e   f o l l o w e d   i n   t h e   e s t a b l i s h m e n t   o f 
t h e   Co m m o n   M o n i t o r i n g   a n d   E v a l u a t i o n 
Framewor k (C ME F). 

T h e   C M E F   w a s   f i n a l i s e d   a n d   p r e s e n t e d 
to   t h e   M e m b e r   St ate s’  d e l e g at i o n s   i n   t h e 
Rural D evelopment Committee in D ecem-
b e r   2 0 0 6   we l l   i n   a d va n ce   o f   t h e   a p p rova l 
o f   p r o g r a m m e s   s o   t h a t   M e m b e r   S t a t e s 
could prepare the setting up of appropr i-
ate st ruc t u re s in advan ce.

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CoNClUsIoNs aND   
rECoMMENDaTIoNs

1 15 .
T h e   C o m m i s s i o n   a g r e e s   t h a t   a l l   t h e   fe a-
t u r e s   o f   t h e   Le a d e r   a p p r o a c h   s h o u l d   b e 
i m p l e m e n t e d   t o   t h e   l a r g e s t   p o s s i b l e 
ex te nt   i n   o rd e r   to   m a x i m i s e   t h e   d e ve l o p -
m e n t   e f f e c t   o n   t h e   t e r r i t o r y,   b u t   r e c a l l s 
t h a t   t h e   c o r e   e l e m e n t   o f   t h e   L e a d e r 
a p p ro a c h   a re   n o t   t h e   i n d i v i d u a l   p ro j e c t s 
t a k e n   o u t   o f   t h e   l o c a l   c o n t e x t ,   b u t   t h e 
i m p l e m e nt at i o n   o f   a n   e nt i re   l o c a l   d e ve l-
opment strateg y.

As the  Cour t mentions in its def i n it ion  of 
t h e   a d d e d   va l u e   o f   t h e   Le a d e r   a p p ro a c h , 
t h i s   i n c l u d e s   a   b e t t e r   i d e n t i f i c a t i o n   o f 
l o c a l   n e e d s   a n d   s o l u t i o n s,   m o re   e n g a g e -
m e n t   o n   t h e   p a r t   o f   s t a k e h o l d e r s   a n d 
g r e a t e r   s c o p e   fo r   i n n o v a t i o n .   M o r e o v e r, 
i t   i n c l u d e s   t h e   c re at i o n   o f   l o c a l   c a p a c i t y, 
w h i c h   l e a d s   t o   i n c r e a s e d   l o c a l   d e v e l o p -
m e n t   a c t i v i t y,   p o o l i n g   l o c a l   r e s o u r c e s , 
n e t w o r k i n g   a l l o w i n g   m u t u a l   l e a r n i n g 
a n d   a n   i n t e g r a t e d   a p p r o a c h   t o   a d d r e s s 
co m p l ex   e co n o m i c   a n d   s o c i a l   i s s u e s.  Th e 
c a p a c i t y - b u i l d i n g   p r o c e s s   i s   a   k e y   e l e -
ment in  th e implement ation of Lead er. 

11 4.
T h e   C o m m i s s i o n   e x p e c t s   t h a t   t h e   c o n-
c e p t   c h o s e n   f o r   t h e   c u r r e n t   p e r i o d ,   a s 
e x p l a i n e d   i n   i t s   r e p l y   t o   t h e   p r e v i o u s 
para graph 113, brings a better assessment 
of  the  Leader  approach.  Fur ther more,  the 
Th e m at i c  wo r k i n g   G ro u p   o f   t h e   Eu ro p e a n 
E v a l u a t i o n   N e t w o r k   f o r   R u r a l   D e v e l o p -
ment can give additional guidance.

In this sense, the Commission has recently 
f i n a l i s e d   a   f i n a l   d r a f t   w o r k i n g   p a p e r   o n 
a s s e s s i n g   t h e   i m p a c t s   o f   Le a d e r   i n   r u r a l 
a r e a s 1 2.   T h e   f i r s t   d r a f t   o f   t h e   w o r k i n g 
paper was provided to the M ember States 
i n   A p r i l   2 0 1 0 ,   w h e n   w o r k   o n   t h e   m i d -
t e r m   e v a l u a t i o n s   w a s   a t   a n   e a r l y   s t a g e . 
I t   p rov i d e s   d e t a i l s   o f   s u g g e s te d   m e t h o d s 
a n d   d a t a   s o u r c e s   f o r   a s s e s s i n g   e a c h   o f 
t h e   i n d i c a t o r s   r e l a t e d   t o   t h e   e v a l u a t i o n 
q u e s t i o n s   a n d   t h e s e   d o   n o t   re l y   o n   C M E F 
monitoring data, but use other evaluative 
methods, e.g. tr iangulation, sur veys, case 
s t u d i e s ,   f o c u s   g r o u p s ,   m u l t i p l i e r   a n a l y-
s i s,   d e r i ve d   d a t a   s e t s,   e tc.  Th i s   g u i d a n ce 
d o c u m e n t   w i l l   g i v e   t h e   o p p o r t u n i t y   f o r 
adjustments in the monitor ing and evalu-
ation  p roces s.

H o we ve r,   t h e re   a re   l i m i t s   t o   t h e   c o l l e c t-
i n g   r e q u i r e m e n t s   o f   L A G s .   T h e   d i f f e r -
e n c e s   b e t w e e n   s t r a t e g i e s   d o   n o t   a l l o w 
t h e   c o l l e c t i o n   o f   t h e   s a m e   i n f o r m a t i o n 
i n   a l l   L A G s ,   a s   t h e   i m p l e m e n t a t i o n   o f   a 
l o c a l   s t ra te g y   i s   p ro ce s s - d r i ve n .   I n d i v i d -
u a l   e va l u at i o n   h a s   to   b e   l i m i te d   i n   o rd e r 
t o   r e s p e c t   t h e   r e l a t i o n   b e t w e e n   c o s t s 
a n d   e f f i c i e n c y   o f   t h e   e v a l u a t i o n   p ro c e s s 
itself.

12  See footnote 3 of the Commission replies.

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I n   r e l a t i o n   t o   i n n o v a t i o n   o r   i n t e r a c -
t i o n   b e t we e n   d i f fe re n t   s e c to r s,   L AG s   a re 
e n c o u r a g e d   t o   p r e s e n t   i n n o v a t i v e   l o c a l 
development strategies but innovation is 
o n e   L AG   s e l e c t i o n   c r i t e r i o n   a m o n g   o t h-
ers. I nnovation is therefore not necessar-
i l y   p re s e nt   i n   a l l   p ro j e c t s   s u p p o r te d.   I t   i s 
m o r e o v e r   n o t   r e a l i s t i c   t h a t   m o s t   o f   t h e 
Lea der proj ec ts sh ould be in novati ve.

I n   t h e   C o m m i s s i o n ’ s   v i e w ,   i n d i v i d-
u a l   p r o j e c t s   c a n   b e   f i n a n c e d   t h r o u g h 
Le a d e r   i n   a s   f a r   a s   t h e y   co nt r i b u te   to   t h e 
achievement of the objec tives of the local 
d e ve l o p m e nt   s t rate g y.   S e e   a l s o   Co m m i s-
s i o n   r e p l i e s   t o   p a r a g r a p h s   1 6 ,   2 1  t o   2 2 
an d 34  to 3 8.

1 17 .
T h e   c e n t r a l   r o l e   o f   l o c a l   d e v e l o p m e n t 
s t r a t e g i e s   t o   i m p l e m e n t   t h e   Le a d e r   a x i s 
i s   r e f l e c t e d   i n   t h e   c r e a t i o n   o f   a   s p e c i f i c 
m e a s u re  ‘i m p l e m e n t a t i o n   o f   l o c a l   d e ve l-
o p m e n t   s t r a t e g i e s ’.   U n d e r   L e a d e r +   t h i s 
wa s   a l s o   t h e   c a s e   w i t h   i t s  ‘Ac t i o n   1 :   S u p -
p o r t   f o r   i n t e g r a t e d   t e r r i t o r i a l   d e v e l o p -
m e n t   s t r a t e g i e s   o f   a   p i l o t   n a t u r e   b a s e d 
on  a bot tom-up approac h’. 

L e a d e r   i s   i m p l e m e n t e d   t h r o u g h   l o c a l 
d e v e l o p m e n t   s t r a t e g i e s   s u p p o r t e d   b y 
a p p r o p r i a t e   m e a s u r e s .   M e m b e r   S t a t e s 
a r e   r e s p o n s i b l e   b o t h   f o r   t h e   q u a l i t y   o f 
t h e   s e l e c t e d   l o c a l   d e v e l o p m e n t   s t r a t e -
g i e s   a n d   fo r   e n s u r i n g   t h e   re s p e c t   o f   t h e 
i m p l e m e n t a t i o n   re q u i re m e n t s,   i n t e r   a l i a 
t h e   e va l u at i o n   a n d   m o n i to r i n g   o f   s t rate -
gies.

T h e   s u c c e s s   o f   t h e   s t r a t e g y   d e p e n d s   o n 
the value of individual accepted projec ts. 
L AGs   are  key   ac tor s  in   en sur ing  th e  qual-
i t y   o f   p r o j e c t s   s e l e c t e d   o n   t h e   b a s i s   o f 
o b j e c t i v e   c r i t e r i a   r e l a t e d   t o   t h e   o v e r a l l 
aims  of  t he st rategy. 

M e m b e r   S t a t e s   m u s t   t a k e   t h e   n e c e s s a r y 
measures to ensure the application of the 
b a s i c   p r i n c i p l e s   o f   t h e   Le a d e r   a p p r o a c h 
a n d   t h e   a c h i e v e m e n t   o f   l o c a l   d e v e l o p -
ment s trategy  o bjec tives.

11 6.
LAG member organisations are represent-
a t i v e   a n d   a c t i v e   l o c a l l y   b a s e d   o r g a n i s a-
t i o n s   o f   t h e   r u r a l   t e r r i t o r y.  T h e   Co m m i s-
s i o n   n o t i c e   o n   Le a d e r + 1 3,   w h i c h   w a s   t h e 
re fe re n ce   d o c u m e nt   fo r   t h e   n at i o n a l   a n d 
r e g i o n a l   Le a d e r +   p r o g r a m m e s ,   s t a t e s   i n 
i t s   p o i n t   1 2 :  ‘ L o c a l   a c t i o n   g r o u p s   m u s t 
co n s i s t   o f   a   b a l a n ce d   a n d   re p re s e nt at i ve 
s e l e c t i o n   o f   p a r t n e r s   d raw n   f ro m   t h e   d i f-
ferent socioeconomic sec tors in the ter r i-
tor y concer ned ’. The par tners consist of a 
mix of public entities and par tners repre -
s e n t i n g   t h e   c i v i l   s o c i e t y.  T h e s e   p a r t n e r s 
a r e   a l s o   t h e   m a i n   a u t h o r s   o f   t h e   s t r a t e -
g i e s   a n d   d o   i n   m o s t   c a s e s   r e p r e s e n t   a 
l a r g e   p a r t   o f   t h e   p o p u l a t i o n   o f   t h e   t e r -
r i t o r y.   I t   i s   t h e r e fo r e   n o r m a l   t h a t   a   p r o -
p o r t i o n   o f   p r o j e c t s   a r e   o r i g i n a t i n g   f r o m 
t h e s e   m e m b e r   o r g a n i s a t i o n s .   L AG   m e m-
b e r s   c a n   p l a y   a n   i m p o r t a n t   r o l e   f o r   t h e 
implementation of the local development 
strateg y. 

w i t h   r e g a r d   t o   t h e   c o m p o s i t i o n   o f   t h e 
p a r t n e r s h i p ,   d u r i n g   t h e   n e g o t i a t i o n s 
l e a d i n g   t o   t h e   a p p r o v a l   o f   t h e   r u r a l 
d e ve l o p m e nt   p ro gra m m e s   ( R D Ps )   fo r   t h e 
2 0 0 7 – 1 3   p e r i o d ,   t h e   C o m m i s s i o n   e x a m-
i n e d   t h a t   t h e   p r i n c i p l e   o f   a   m i n i m u m   o f 
5 0  %   r e p r e s e n t a t i v e s   o f   t h e   c i v i l   s o c i-
e t y   i n   t h e   p a r t n e r s h i p   w a s   i n c l u d e d ,   a s 
r e q u i r e d   b y   A r t i c l e   6 2 . 1 ( b )   o f   R e g u l a-
tion (EC ) No 1698/2005. This requirement 
applies  to t he dec isio n-ma k ing  l e vel.

St i l l,   t h e   Co m m i s s i o n   w i l l   co n s i d e r   re v i s -
i n g   e x i s t i n g   g u i d a n c e   i n   o r d e r   t o   a v o i d 
any  misinter p ret atio n.

I n   a d d i t i o n   t o   t h i s ,   t h e   C o m m i s s i o n   w i l l 
co n s i d e r   e n co u ra gi n g   a   m o re   o p e n   m e m-
bership polic y at LAG level for the design 
of t he p o st-2013 p ol ic y.

13  Commission notice to the Member States of 14 April 2000 
laying down guidelines for the Community initiative for rural 

development (Leader+).

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1 20 .
T h e   C o m m i s s i o n   d o e s   n o t   c o n s i d e r   t h a t 
t h e   c o s t s   o f   i m p l e m e n t i n g   L e a d e r   a r e 
n ecessar ily  substantial.

R u r a l   d e v e l o p m e n t   p o l i c y   i s   i m p l e -
m e n te d   i n   s h a re d   m a n a g e m e n t   b e t we e n 
t h e   Co m m i s s i o n   a n d   t h e   M e m b e r   S t a te s, 
r e s p e c t i n g   t h e   p r i n c i p l e   o f   s u b s i d i a r i t y. 
The implementation of Leader is comple -
m e nte d   by   a   s p e c i f i c   m a n d ato r y   fe at u re, 
w h i c h   i s   t h a t   a   s i g n i f i c a n t   p a r t   o f   m a n-
a g e m e nt   t a s k s   i s   t ra n s fe r re d   to   t h e   l o c a l 
level.

L A G s ’  t a s k s   d o   n o t   c o r r e s p o n d   t o   a d d i-
t i o n a l   o r   d u p l i c a t e d   t a s k s   b u t   t o   d e l e -
g ate d   t a s k s,   w h i c h   a re   n o t   c a r r i e d   o u t   at 
p ro gra m m e   l e ve l   ( co n t ro l,   p ro j e c t   s e l e c -
t i o n   a n d   p ay m e n t   i n   c e r t a i n   r u r a l   d e ve l-
opment programmes ). 

O n   a v e r a g e ,   r u n n i n g   c o s t s   a r e   l i m i t e d 
a n d   r e p r e s e n t   1 5  %   o f   t h e   p u b l i c   s u p -
p o r t   t o   t h e   l o c a l   d e v e l o p m e n t   s t r a t e g y. 
Th i s   i s   b e l ow   t h e   u p p e r   l i m i t   o f   2 0  %   l a i d 
d ow n   i n   Ar t i c l e   3 8   o f   R e g u l at i o n   ( E C )   N o 
1 97 4/2 00 6.

T h e r e   i s   i n s u f f i c i e n t   e v i d e n c e   o f   a d d i-
t i o n a l   d e l a y s   r e s u l t i n g   f r o m   t h e   L e a d e r 
method. There are different Leader imple -
m e n t a t i o n   m o d e l s   i n   t h e   E U   i n v o l v i n g 
additional tasks beyond the basic projec t 
s e l e c t i o n   t a s k   ( p r o j e c t   a p p r o v a l   a n d / o r 
p a y m e n t   o f   c l a i m s   i n   3 9   p r o g r a m m e s   i n 
t h e   c u r r e n t   p e r i o d ) .   L AG s   w i t h   f i n a n c i a l 
a n d   a d m i n i s t r a t i v e   a u t o n o m y   h a v e   i n 
ge neral sh or te r proce dure s.

S e e   a l s o   C o m m i s s i o n   r e p l i e s   t o   p a r a-
graph s 7 , and 6 4  to 7 1 .

11 8.
T h e   C o m m i s s i o n   a g r e e s   t h a t   t h e r e   i s   a 
n e e d   f o r   a   h i g h   d e g r e e   o f   t r a n s p a r e n c y 
a n d   t h e   s u b s e q u e n t   n e e d   fo r   L AG s   to   b e 
a b l e   to   d e m o n s t ra te   t h a t   t h e y   h ave   co n-
sistentl y fo l lowed p ro per p ro cedures.

The Commission will consider revising the 
‘G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e   L e a d e r 
a x i s ’  i n   t h e   s e n s e   o f   f u r t h e r   c l a r i f y i n g 
the respec t of basic pr inciples on projec t 
selec tion (transparenc y, equal treatment, 
u s e   o f   o b j e c t i ve   s e l e c t i o n   c r i t e r i a ,   d e c i-
s i o n   re p o r t i n g )   o n   t h e   b a s i s   o f   t h e   g o o d 
prac tices co ll ec ted.

L A G   m e m b e r s   a r e   r e p r e s e n t a t i v e   a n d 
a c t i ve   l o c a l l y   b a s e d   o rg a n i s at i o n s   o f   t h e 
r u ra l   te r r i to r y.   I t   i s   t h e re fo re   n o r m a l   t h at 
a   p r o p o r t i o n   o f   p r o j e c t s   a r e   o r i g i n a t i n g 
from these organisations. Excluding these 
p ro j e c t s   wo u l d   co n s t i t u te   a   m a j o r   o b s t a-
c l e   fo r   t h e   s u cce s s f u l   i m p l e m e n t a t i o n   o f 
the  local  devel op ment  s t rategy.

H o w e v e r   M e m b e r   S t a t e s   h a v e   t o   e n s u r e 
that there  is  n o conf lic t  of  interes t. 

S e e   a l s o   C o m m i s s i o n   r e p l i e s   t o   p a r a-
graphs  56 to  6 1,  an d to  11 7.

11 9.
T h e   C o m m i s s i o n   w i l l   e x a m i n e   i n   d e p t h 
t h e   q u e s t i o n   o f   t h e   s t a r t   o f   e l i gi b i l i t y   o f 
projec ts tak ing into account the need for 
a   h a r m o n i s e d   a p p r o a c h   a c r o s s   C o m m u-
nit y fu nding u nder  shared man ag e ment.

Ta k i n g   i n t o   a c c o u n t   t h e   w i d e   v a r i e t y   o f 
L e a d e r   p r o j e c t s ,   i t   m i g h t   b e   d i f f i c u l t   t o 
j u d g e   a   p r i o r i   f a c t o r s   l i k e   t h e   d e g r e e 
o f   p r o f i t a b i l i t y   a n d   a t   t h e   s a m e   t i m e   t o 
e n s u r e   t h a t   t h e   d e s i r e d   o u t c o m e s   a r e 
achieved.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

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COMMISSION

Fu r t h e r m o r e ,   t h e   C o m m i s s i o n   e x e c u t e d 
a u d i t s   o n   3 7   o u t   o f   7 3   L e a d e r +   p r o -
g r a m m e s   f o r   t h e   p r o g r a m m i n g   p e r i o d 
2 0 0 0 – 0 6 . T h e   C o m m i s s i o n   i s   a u d i t i n g 
L e a d e r +   a n d   L e a d e r   m e a s u r e s   i n   t h e 
framework of its overall audit programme, 
t a k i n g   i n t o   a c c o u n t   t h e i r   s p e c i f i c   r i s k s , 
m a k i n g   r e c o m m e n d a t i o n s   w h e r e   n e c e s -
sar y and applying financial cor rec tions in 
j us tified c ases. 

T h e   c o n t e x t   i n   w h i c h   L e a d e r   w a s   a n d   i s 
b e i n g   i m p l e m e n t e d   h a s   e v o l v e d   s i n c e 
2 0 0 0   n o t   t h e   l e a s t   d u e   t o   t h e   d i f f e r e n t 
design of the implementation throughout 
the different funding periods. This in turn 
i m p l i e s   t h a t   m a n y   M e m b e r   S t a t e s   h a v e 
h a d   t o   a d a p t   t h e i r   a d m i n i s t r a t i v e   s t r u c -
ture for  t he implementat ion  of Lea de r. 

T h e   C o m m i s s i o n   w i l l   c o n t i n u e   t o   t a k e 
t h e   n e c e s s a r y   i n i t i a t i v e s   t o   i m p r o v e   t h e 
i m p l e m e n t a t i o n   o f   t h e   L e a d e r   m e t h o d 
i n   t h e   l i g h t   o f   a l l   e l e m e n t s   p r o v i n g   t h i s 
n eed.

Le a d e r   re q u i re s   a n   a d m i n i s t rat i ve   c a p a c -
it y within the author ities to deal with the 
specificit y of the method. M ember States 
t h a t   j o i n e d   t h e   E U   a f t e r   2 0 0 4   c o u l d   n o t 
b e n e f i t   f r o m   t h e   t h r e e   p r o g r a m m i n g 
p e r i o d s   o f   t h e   Co m m u n i t y   i n i t i at i ve.  Th e 
Commission is aware of this lack of expe -
r i e n c e :  TA I E X   ( a   p r e - a c c e s s i o n   t e c h n i c a l 
a s s i s t a n ce   to o l )   t ra i n i n g   s e m i n a r s   o n   t h e 
Le a d e r   m e t h o d   we re   o rg a n i s e d   fo r   t h e s e 
countries with less experience. The ac tion 
of the European Net wor k for Rural D evel-
o p m e nt   w i l l   a l s o   co nt r i b u te   to   exc h a n g e 
ex p e r i e n ce   o n   t h e   n e ce s s a r y   a d m i n i s t ra-
tive prac tice to im plem ent Le ader. 

S e e   a l s o   C o m m i s s i o n   r e p l i e s   t o   p a r a-
graph s 7 2, 7 3,  91  and 11 3.

12 1.
T h e   C o m m i s s i o n ,   a s   r e g a r d s   t h e   i m p l e -
m e nt at i o n   o f   t h e   Le a d e r   a p p ro a c h   i n   t h e 
c u r r e n t   p r o g r a m m i n g   p e r i o d ,   h a s   t a k e n 
a   co m p re h e n s i ve   s e t   o f   a c t i o n s   a i m e d   a t 
f u r t h e r   e n c o u r a g i n g   g o o d   p r a c t i c e   a n d 
sound financial  manag ement:

—  The   e sse nt ial  p r in cip l es   o f  t he  Le ade r 
a p p ro a c h   h ave   b e e n   l a i d   d ow n   i n   t h e 
rel evant  l eg al  f ramewor k .

— 

— 

I t h as provided  gu id ance in the  phas e 
o f   p r o g r a m m e   d e s i g n   a n d   a p p r o v a l 
through the ‘Guide on the application 
of t he Lead er axis’.

I t has established ‘focus groups’ within 
the Leader sub - committee of the Euro -
p e a n   N e t wo r k   fo r   R u r a l   D e ve l o p m e n t 
( E N R D )   w i t h   a   m a n d a t e   t o   e x a m i n e 
implementation issues. The ENRD con-
t i n u e s   w i t h   t h e   e xc h a n g e   o f   a c h i e ve -
m e n t s ’  e x p e r i e n c e   a n d   k n o w - h o w 
bet ween all ac tors involved in the im -
plementation of the Leader approach, 
a s   i t   w a s   a l r e a d y   a   p r i o r i t y   o f   Le a d e r 
II and Leader+ (then with its European 
Leade r II  and Le ad er+ O b s er vator ie s) .

T h e   Co m m i s s i o n   a n d   t h e   M e m b e r   S t a t e s 
( m a n a g i n g   a u t h o r i t y   a n d   L A G   l e v e l )   a r e 
i n   t h e   c u r re n t   p e r i o d   u n d e r t a k i n g   a   s i g-
n i f i c a n t   re v i e w   t o   b e t t e r   d e f i n e   t h e   ro l e 
o f   t h e   L A G s ,   t h e   r o l e   o f   c a p a c i t y - b u i l d-
i n g ,   t h e   e l i g i b i l i t y   c r i t e r i a   a n d   a   m o r e 
clear repar tition of the tasks bet ween the 
m a n a gi n g   a u t h o r i t i e s   a n d   t h e   L AG s.  Th i s 
p r o c e s s   i s   c a r r i e d   o u t   i n   a   c o n s t r u c t i v e 
a n d   co o p e rat i ve   way   i n   t h e   f ra m e wo r k   o f 
the European Net wor k for Rural D evelop -
m e n t   ( f o c u s   g r o u p s   o f   t h e   L e a d e r   s u b -
commit tee).

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

12 2.
T h e   C o m m i s s i o n   d o e s   o b s e r v e   i m p r o v e -
ments in the implementation of Leader in 
m a n y   M e m b e r   S t a t e s   a n d   c a n n o t   t h e r e -
fore s hare t he Co u r t ’s co nc l u sio n .

M o r e o v e r,   t h e   C o m m i s s i o n   i s   c o n v i n c e d 
t h a t   t h e   e f f o r t s   u n d e r t a k e n   i n   t h e   c u r -
rent programming per iod jointly with the 
M e m b e r   St ate s   to   wo r k   o n   p ro b l e m s   a n d 
s o l u t i o n s   w i l l   s i gn i f i c a n t l y   co n t r i b u te   to 
e n h a n ce   f u r t h e r   t h e   ove ra l l   i m p l e m e nt a-
tion of t he Leader ap p ro ac h. 

Re comme nd a t ion   1
(a )  The Commission will examine in depth 
t h e   q u e s t i o n   o f   t h e   s t a r t   o f   e l i g i b i l-
i t y   o f   p r o j e c t s   t a k i n g   i n t o   a c c o u n t 
t h e   n e e d   f o r   a   h a r m o n i s e d   a p p r o a c h 
a c r o s s   C o m m u n i t y   f u n d i n g   u n d e r 
sha red m anagem ent.

(b)  T h e   C o m m i s s i o n   w i l l   g i v e   a d d i t i o n a l 
gu idance   in  t his   res p e c t  i n  an   update 
of the ‘Guide on the application of the 
L e a d e r   a x i s’  s t i l l   f o r   t h e   c u r r e n t   p r o -
gramm ing  p er iod.

(c)  R u l e s   d o   a l r e a d y   e x i s t   i n   t h e   c u r r e n t 
l e g a l   f r a m e w o r k .   A r t i c l e   6 2 . 1 ( b )   o f 
R e g u l a t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5   s t i p u-
lates  t hat  at  t he  decis ion -m ak in g  le v-
e l   re p re s e n t a t i ve s   o f   t h e   c i v i l   s o c i e t y 
must   m ake  u p  at   l east  50  %  of  th e  lo -
cal p ar t nership.

98

REPLy OF THE 
COMMISSION

H owe ve r,   t h e   Co m m i s s i o n   a c k n ow l e d g e s 
t h a t   t h e   e n u m e r a t i o n   o f   t h e   p r i n c i p l e s 
c o u l d   b e   m o re   s p e c i f i c.  T h e   Co m m i s s i o n 
w i l l   c o n s i d e r   r e v i s i n g   e x i s t i n g   g u i d a n c e 
t o   f u r t h e r   c l a r i f y   t h e   c o m p u l s o r y   a p p l i-
c a t i o n   o f   t h e  ‘d o u b l e   q u o r u m’  r u l e   t h a t 
s h a l l   a p p l y   t o   t h e   L AG   c o m p o s i t i o n   a n d 
at  decision-m ak ing leve l.

1 23 .
M e m b e r   St ate s   h ave   to   e n s u re   t h at   t h e re 
is no conflic t of interest under the shared 
m a n a g e m e nt   a p p ro a c h .   D e c i s i o n - m a k i n g 
p r o c e d u r e s   a n d   s e l e c t i o n   c r i t e r i a   t o   b e 
a p p l i e d   b y   t h e   L A G s   a r e   n o t   p a r t   o f   t h e 
p r o g r a m m e   b u t   p a r t   o f   t h e   l o c a l   i m p l e -
m e n t a t i o n   a s s e s s e d   b y   t h e   m a n a g i n g 
authorit y when the LAG is selec ted. M em -
b e r   S t a t e s   c a n   a l s o   a p p l y   c o m m o n   r u l e s 
for all L AGs  es tablishe d at  n atio nal  le ve l.

Re comm enda tion  2
T h e   C o m m i s s i o n   a g r e e s   w i t h   t h e   C o u r t 
that, as regards the decision-tak ing proc-
e s s ,   t h e r e   s h o u l d   b e   c l e a r   r u l e s   o n   c o n -
flic t of interests, which should be str ic tly 
followed.

A r t i c l e   6 1 . 1 ( b )   o f   R e g u l a t i o n   ( E C )   N o 
1 6 9 8 / 2 0 0 5   fo re s e e s   t h at   at   t h e   d e c i s i o n -
m a k i n g   l e v e l   t h e   e c o n o m i c   a n d   s o c i a l 
par tners, as well as other representatives 
of  th e  c ivil  societ y  must  m ak e  up  at  le as t 
5 0  % of t he par t ne rsh ip.

T h e   Co m m i s s i o n   w i l l   a l s o   p ro m o t e   g o o d 
p r a c t i c e s   t h r o u g h   t h e   ‘ G u i d e   o n   t h e 
a p p l i c a t i o n   o f   t h e   L e a d e r   a x i s ’  a n d   w i l l 
a s k   M e m b e r   S t a t e s   t o   e n s u r e   a n d   c h e c k 
effec t ive s afeg uards.

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Special Report No 5/2010 — Implementation of the Leader approach for rural development

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12 4.
T h e   ‘ a d m i n i s t r a t i v e   m a i n s t r e a m i n g ’  o f 
t h e   L e a d e r   a p p r o a c h   h a s   b e e n   i n v e s t i-
g a t e d   b y   t h e   L e a d e r   s u b - c o m m i t t e e   o f 
the European Net wor k for Rural D evelop -
ment (ENRD). Preliminar y repor ts of focus 
groups, including recommendations, were 
presented  o n 20 M ay 2 01 0.

1 25 .
Th e   a c t i v i t i e s   u n d e r   t h e   Le a d e r   a x i s   h ave 
been   approve d  by  t he  Commis s ion   ba s ed 
o n   t h e   l e g a l   r e q u i r e m e n t s   a s   s t i p u l a t e d 
b y   R e g u l a t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5   a n d 
o f   t h e   C o m m u n i t y   s t r a t e g i c   g u i d e l i n e s 
d e f i n i n g   t h e   C o m m u n i t y   p r i o r i t i e s   f o r 
r ural developme nt  polic y. 

C o n c r e t e   g o o d   p r a c t i c e   a n d   r e c o m m e n-
d a t i o n s   c o u l d   b e   d i s s e m i n a t e d   t o   t h e 
M e m b e r   St ate s   t h ro u g h   a n   u p d ate   o f   t h e 
‘G u i d e   o n   t h e   a p p l i c a t i o n   o f   t h e   L e a d e r 
axis’.

Re comme nd a t ion   3
M o d i f i c a t i o n s   o f   r u r a l   d e ve l o p m e n t   p ro -
g r a m m e s   ( R D Ps )   i n   o rd e r   t o   i m p ro ve   t h e 
i m p l e m e n t a t i o n   o f   l o c a l   s t r a t e g i e s   a r e 
always  po ss ib l e.

Fu r t h e r m o r e,   t h e  ‘G u i d e   o n   t h e   a p p l i c a-
t i o n   o f   t h e   Le a d e r   a x i s’  c a n   b e   r e v i e w e d 
t o   i m p r o v e   g u i d a n c e   t o   t h e   M e m b e r 
St ate s   a s   re g a rd s   f u n d i n g   o f   ( i n n ovat i ve ) 
projec t s  o ut side  the meas ure c at alog ue.

S i n c e   l a t e   2 0 0 9   s e v e r a l   M e m b e r   S t a t e s 
s e e k   t o   a m e n d   t h e i r   p r o g r a m m e s   t o 
i m p rove   t h e   e f fe c t i ve   i m p l e m e nt at i o n   o f 
the Leader method by allowing more flex -
ibilit y mainly through the introduc tion of 
i nte grate d   o r   s p e c i a l   m e a s u re s.  To   a   co n-
siderable ex tent, this is a consequence of 
the discussions animated by the Commis-
s i o n   i n   t h e   f ra m e wo r k   o f   t h e   Le a d e r   s u b -
c o m m i t t e e   o f   t h e   E u r o p e a n   N e t w o r k   fo r 
Ru ral D evel op ment.

I n the contex t of the programme approval 
t h e   C o m m i s s i o n   h a s   e x a m i n e d   k e y   e l e -
m e n t s   f o r e s e e n   i n   A n n e x   2   o f   R e g u l a-
t i o n   ( E C )   N o   1 9 7 4 / 2 0 0 6 .   H o w e v e r,   o t h e r 
a d d i t i o n a l   m a n a g e m e n t   e l e m e n t s   o f 
L e a d e r   h a d   t o   b e   d e f i n e d   b y   t h e   m a n-
a g i n g   a u t h o r i t i e s   a f t e r   t h e   p r o g r a m m e 
approval. S ee reply  to paragraph  9 1 .

The  detailed selec tion  procedure   of   loc a l 
d e v e l o p m e n t   s t r a t e g i e s   i s   d e f i n e d   a t 
M e m b e r   S t a te   l e ve l   i n   l i n e   w i t h   t h e   s u b -
sidiar it y pr inciple. LAGs have to meet the 
m i n i m u m   re q u i re m e nt s   s e t   o u t   i n   Ar t i c l e 
6 2 . 1 ( a )   o f   R e g u l a t i o n   ( E C )   N o   1 6 9 8 / 2 0 0 5 
as regards the content of the local devel -
opment strateg y.

Fu r t h e r m o re,   a   l o c a l   d e ve l o p m e n t   s t r a t-
e g y   s h o u l d   b e   a p p r o v e d   b y   M e m b e r 
St ate s   i n   t h e   l o c a l   co ntex t   o f   t h e   s p e c i f i c 
r ural area.

Re comm enda tion  4
T h e   m i d - t e r m   e v a l u a t i o n   r e p o r t s   d u e   a t 
t h e   e n d   o f   2 0 1 0   w i l l   i n c l u d e   re c o m m e n-
dations for rural development programme 
m o d i f i c a t i o n s   t o   a l i g n   p r o g r a m m e   c o n-
t e n t   w i t h   o b j e c t i v e s .   T h e   C o m m i s s i o n 
w i l l   t a k e   t h i s   o p p o r t u n i t y   t o   d i s c u s s 
A x i s   4   i m p l e m e n t a t i o n   w i t h   t h e   M e m b e r 
S t a t e s   a n d   i n   p a r t i c u l a r   t h e   p o s s i b i l i t y 
t o   i m p ro ve   t h e   q u a l i t y   o f   l o c a l   d e ve l o p -
m e n t   s t r a t e g i e s   a n d   t h e i r   i m p l e m e n t a-
t i o n   t h r o u g h   i n t e r   a l i a   b e t t e r   L A G   l e v e l 
mon itor in g an d evaluation .

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

100

T h e   c o l l e c t i o n   a n d   d i s s e m i n a t i o n   o f 
good prac tice on monitor ing at LAG level 
t h ro u g h   t h e   Eu ro p e a n   N e t wo r k   fo r   R u r a l 
D e v e l o p m e n t   ( E N R D )   a n d   o n   e v a l u a t i o n 
in the contex t of the European Evaluation 
N e t wo r k   fo r   R u ra l   D e ve l o p m e n t   i s   e nv i s-
aged i n par t icul ar.

Re comm e nda tion  5
I n the contex t of the programme approval 
f o r   t h e   c u r r e n t   p r o g r a m m i n g   p e r i o d 
u n d e r   s h a r e d   m a n a g e m e n t ,   t h e   C o m -
m i s s i o n   h a s   e x a m i n e d   t h e   k e y   e l e m e n t s 
f o r e s e e n   i n   A n n e x   2   o f   R e g u l a t i o n   ( E C ) 
N o   1 9 7 4 / 2 0 0 6 .   H owe ve r,   o t h e r   a d d i t i o n a l 
m a n a g e m e n t   e l e m e n t s   o f   L e a d e r   h a v e 
t o   b e   d e f i n e d   b y   t h e   m a n a g i n g   a u t h o r i -
ties af ter the programme approval in line 
wi th th e sub sidiar it y p r inc ip l e.

126.
The  mid-ter m  eval uat ion  o f  Lea de r +   took 
p l a c e   a t   a n   e a r l y   s t a g e   i n   L A G   s t r a t e g y 
i m p l e m e n t a t i o n .   H o w e v e r,   t h e   e x - p o s t 
e v a l u a t i o n   o f   L e a d e r + ,   w h i c h   i s   u n d e r 
w a y   a n d   w i l l   p r o d u c e   i t s   f i n a l   r e p o r t 
t o w a r d s   t h e   e n d   o f   2 0 1 0 ,   i s   c o n s i d e r i n g 
t h e   i s s u e s   o f   e f fe c t i ve n e s s   a n d   e f f i c i e n c y 
o f   e x p e n d i t u re,   e tc.   I t   i s   n o r m a l   t h a t   t h e 
e f f e c t i v e n e s s   a n d   e f f i c i e n c y   o f   p o l i c y 
i n s t r u m e n t s   a r e   a s s e s s e d   o n   a n   e x - p o s t 
b a s i s .   T h i s   e v a l u a t i o n   f o r m s   p a r t   o f   t h e 
standa rd p ol ic y  eval uation c ycl e. 

The relevant information contained in the 
L e a d e r +   e x - p o s t  e v a l u a t i o n   w i l l   p r o v i d e 
t h e   b a s i s   f o r   t h e   C o m m i s s i o n’s   f u r t h e r 
wor k on  the Le ader approach .

L i m i t a t i o n s   i n h e r e n t   t o   l o c a l   d e v e l o p -
m e n t   h a v e   t o   b e   c o n s i d e r e d   i n   v i e w   o f 
i d e n t i f y i n g   a n d   d i s s e m i n a t i n g   a p p ro p r i-
ate   s i m p l e   r u l e s   a n d   p ro ce d u re s   m i t i g at -
i n g   p o s s i b l e   r i s k s   a n d   e n s u r i n g   r e l i a b l e 
fin ancial manag em ent.

Re comm enda tion  6
There is a per manent dialogue with M em-
b e r   S t a t e s   t o   i m p r o v e   t h e   i m p l e m e n t a-
t i o n   o f   t h e   Le a d e r   a p p ro a c h   t h ro u g h   t h e 
L e a d e r   s u b - c o m m i t t e e   o f   t h e   E u r o p e a n 
N e t w o r k   fo r   R u r a l   D e v e l o p m e n t   ( E N R D ) . 
T h e   C o m m i s s i o n   i s   a l s o   i n   d i a l o g u e 
w i t h   t h e   M e m b e r   S t a t e s   a s   r e g a r d s   t h e 
i m p r o v e m e n t   o f   t h e   C o m m o n   M o n i t o r -
i n g   a n d   Eva l u at i o n   Fra m e wo r k ,   i n c l u d i n g 
the monitor ing indicators for Leader. The 
Co m m i s s i o n   h a s   re ce nt l y   f i n a l i s e d   a   f i n a l 
d r a f t   w o r k i n g   p a p e r   o n   a s s e s s i n g   t h e 
impac t s of  Leader  in  rural areas.

T h e   d i f f e r e n c e s   b e t w e e n   s t r a t e g i e s   d o 
n o t   a l l o w   t h e   c o l l e c t i o n   o f   t h e   s a m e 
i n f o r m a t i o n   i n   a l l   L A G s ,   a s   t h e   i m p l e -
m e n t a t i o n   o f   a   l o c a l   s t r a te g y   i s   p ro ce s s -
d r i v e n .   I n d i v i d u a l   e v a l u a t i o n   h a s   t o   b e 
l i m i t e d   i n   o r d e r   t o   r e s p e c t   t h e   r e l a t i o n 
bet wee n cost s an d efficienc y of t he  eval-
uation  proce ss itself.

Special Report No 5/2010 — Implementation of the Leader approach for rural development

Special Report No 5/2010 — Implementation of the Leader approach for rural development

European Court of Auditors

special report No 5/2010

Implementation of the leader approach for rural development

Luxembourg: Publications Office of the European Union

2010 — 100 pp. — 21 × 29.7 cm

ISBN 978-92-9207-883-6

doi:10.2865/27311

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Q
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C

LEADER  IS  AN  APPROACH  FOR  IMPLEMENTING  THE  EU’S  RURAL 

DEVELOPMENT POLICy THROUGH LOCAL ACTION GROUPS (LAGS). 

THIS  INVOLVES  SPECIFIC  COSTS  AND  RISkS  BUT  PROMISES  AN 

ADDED VALUE FROM FOLLOwING A BOT TOM-UP AND PARTNERSHIP 

A P P R OAC H .  I N   T H I S   R E P O R T   T H E   CO U R T   F I N D S   T H AT   L AG S 

IMPLEMENTED THE LEADER APPROACH IN wAyS THAT LIMITED THE 

POTENTIAL  FOR  ADDED VALUE  AND  GAVE  GRANTS TO  PROJEC TS 

wITHOUT  DUE  REGARD TO  EFFICIENCy.  PROCEDURES wERE  NOT 

ALwAyS TRANSPARENT AND DID NOT SUFFICIENTLy DEMONSTRATE 

THAT THE  LAGS TOOk  DECISIONS  ON  AN  OBJEC TIVE  BASIS,  FREE 

FROM  CONFLIC TS  OF  INTEREST. THE  COMMISSION  HAS  NOT yET 

D E M O N S T R AT E D  T H E  E F F E C T I V E N E S S  O R  E F F I C I E N C y  O F  T H E 

EXPENDITURE, THE ADDED VALUE ACHIEVED THROUGH FOLLOwING 

THE LEADER APPROACH, THE EXTENT TO wHICH THE kNOwN RISkS 

HAVE MATERIALISED OR THE REAL COSTS OF IMPLEMENTATION.

EUROPEAN COURT OF AUDITORS