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What future for regional development in the
enlarged Europe? An outline of the Commission's
proposals Association of Irish Regions
conference, Ballina, 15 October 2004
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Point of departure 2000-2006
Three Objectives and four Community Initiatives
49.5 of the population all regions in EU25
live in areas covered by Objective 1 or
Objective 2 Financial resources of Euro 233 bn
representing one third of the EU's total budget
or 0.45 of the EUs GDP
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Discussion following second Cohesion report
Unanimous wish to help the lagging
regions Strong desire to help statistical effect
regions Special measures needed for territorial
cohesion Divergence on continuation of
Objective 2 Divergence on cash, methods Lisbon
Agenda, etc.
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Why maintain a European regional policy?
Long-term strategic approach backed by financial
stability over 7 years Exclusive focus on
physical and human capital investment Respect
across Europe for the rules of the Single Market
Emphasis on job creation Promotion of good
governance Leverage effects
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Paperwork proposed new legal architecture
General Regulation on the ERDF, the ESF and the
Cohesion Fund
Council by unanimity, assent of EP ERDF, ESF
Codecision Cohesion Fund Consultation

• ERDF Regulation
• ESF Regulation
• Cohesion Fund Regulation

• Regulation establishing a
• European grouping for
• cross-border cooperation (EGCC)

• Later Single Commission Regulation
• Information, Publicity, Financial
• control and Financial corrections

New General Regulation applies to the
Cohesion Fund a new Rural Development Fund now
outside Cohesion Policy one Commission
regulation instead of five for specific aspects
eligibility rules simplified and incorporated in
the General and Funds' regulations.
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The reforms guiding principles
Affordability 336.1 billion euros, 0.41 of GNP
same as today when rural development and
fisheries resources are included. One-third of
the Financial Perspective, 2007-2013
Concentration Thematic Lisbon and
Gothenburg agendas, Broad Economic Policy
Guidelines and the European Employment
Strategy Financial Convergence 78 of total
resources Competitiveness 18 Cooperation
4

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• Simplification
• three strategic priorities
• three Funds (ERDF ESF CF)
• no micro-zoning of eligible areas
• mono-fund programmes
• a more flexible financial management
• - financial management at the level of the
• priorities
• - proportionality regarding control, evaluation
• and monitoring (threshold Community
• cofinancing below 33 and EUR 250 million
• of total costs)
• - eligibility of expenditures national rules
• Decentralisation stronger role for the regions,
  local
• actors, urban authorities

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Art. 15-18 Gen.Reg. and Fin. Perspect.
9
Geographical dimension Regions below or close to
75 threshold
GDP/head average 1999-2000-2001
below 75 in EU25
statististical effect below 75 in EU15 above
in EU25
"naturally" above 75 because of growth
other regions
Index EU 25 100
Art. 56 Gen.Reg.
Source Eurostat
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GDP per head position in NIRL and IRL

• Northern Ireland
• 89.2 of EU-25 average
• ranking 147 (of 254 regions)
• Ireland
• Border, Midland, Western 92.0
• ranking 139
• Southern and Eastern 138.7
• ranking 22
• Cut-off convergence objective 185
• Statistical effect cut-off 164

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Thematic concentration role of ERDF in
strategic objectives I II
I. Convergence objective research and
technological development, innovation and
entrepreneurship information society
environment risk prevention tourism transport
networks/TEN energy networks and renewable
energies education and health investments
direct aids to SMEs. Reinforced by Cohesion Fund
in eligible countries. II. Regional
competitiveness and employment objective Innovati
on and the knowledge economy (RTD, technology
transfer, innovation in SMEs) Environment and
risk prevention (NATURA 2000 rehabilitation of
contaminated land promotion of energy efficiency
and renewable energies) Access - outside urban
areas - to transport and telecommunication
services of general economic interest
Art. 4, 5 ERDF Reg.
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Thematic concentration role of the ESF in
strategic objectives I II
Convergence and Regional competitiveness and
employment objective Increasing adaptability
of workers and enterprises enhancing access to
employment and participation in the labour
market reinforcing social inclusion of people
at a disadvantage and combating discrimination
mobilising for reforms in the fields of
employment and inclusion (pacts, partnerships).
Regional competitiveness and employment
objective expanding and improving investment in
human capital (education, training, post-graduate
studies) strengthening institutional capacity
and the efficiency of public administrations and
other organisations (studies, training for
structural fund actors).
Art. 2 ESF Reg.
Art. 3 ESF Reg.
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Thematic concentration role of the ERDF in
strategic objective III
cross-border economic and social activities
entrepreneurship and the development of SMEs,
tourism, and culture protection of the
environment better access to transport,
information and communication networks and
services, and water and energy systems social
and cultural infrastructures in particular in the
health and education sectors transnational
cooperation, integrated territorial development
water and coastal management, accessibility,
advanced communications and information
technologies maritime safety risk prevention
RTD and technological development networks
etc. networking and exchange of experience
among regional and local authorities
co-operation network programmes, studies, data
collection, and the observation and analysis of
development tendencies in the Union (studies,
data collection, and analysis of Community
development trends).
Art. 5 ERDF Reg.
Art. 6 ERDF Reg
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Pre-programming phase who get what?

• Convergence objective
• Berlin formula
• Statistical phasing-out
• 4 ceiling
• Cohesion Fund
• Competitiveness and employment
• National allocation on objective criteria (GDP,
  unemployment, employment, density of population)
• 50-50 split between regional and national
  programmes
• Competitiveness regions proposed by Member State
• Regional financial allocations on an objective
  basis
• Urban sub-delegation inside the regional
  programme
• Special "phasing-in" package
• Cooperation
• population in eligible regions

Art. 35 and 36 Gen.Reg.
Art. 20, 48, 49 Gen.Reg.
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Programming cycle
Art. 16-21 and 28 Gen.Reg.
Art. 23-29 Gen.Reg.
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Implementation Community contribution rates
Participation rates vary with respect to
economic, social and territorial problems and are
calculated as share of public expenses 85 for
the Cohesion Fund outermost regions and
outlying Greek islands 75 for the Convergence
programmes (exception 80 for member
states with Cohesion Fund) 50 for the Regional
competitiveness and employ- ment
programmes 75 for the European territorial
co-operation programmes 10 for
inter-regional co-operation 5 (60 maximum)
for "regional competitiveness and employment"
programmes for areas with natural handicaps
(islands, mountains, densely populated areas and
regions with external borders before 30 April
2004)
Art. 5152 Gen.Reg.
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Implementation quality flexibility
Quality and performance reserve 3 of the
allocations for the Convergence and Regional
competitiveness and employment objective
Council to decide in 2011 the attribution by
quality criteria National reserve for
unexpected 1 of the Convergence and 3
Regional competitiveness and employment
objective to be allocated for unexpected economic
and social restructuring
Art. 35 and 36 Gen.Reg.
Art. 20, 48, 49 Gen.Reg.
18
Implementation European grouping for
cross-border cooperation (EGCC)
Background difficulties in managing
cross-border, transnational and interregional
programmes and projects because of different
legal and national laws and procedures approach
an institution with a legal personality based on
a voluntary 'convention' between Member States
and/or regions carrying out cross-border,
transnational and interregional programmes and
projects based on Art. 159 Abs. 3 TEC no
financial responsibility for EU funds can be
delegated to the EGCC
Art. 1-3 EGCC Reg.
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Next steps
End 2004 PM 13 October, PEACE II and IFI,
2005-2006 Parallel debate in ECOFIN and GAC
Opinions of the EP, CdR and CES The "Group of
Six" UK, NL and the question of frameworks
Mid-2005 Adoption of Financial Perspective and
legislation (IIA and Council regulations)
Beginning 2006 Council adopts Strategic
Guidelines on cohesion. Preparation of
programmes for 2007-2013 1 Jan 2007
Implementation begins
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Convergence objective 78.5 including a
special programme for outermost regions
(EUR 264 bn.)
Cohesion Policy 2007-2013 3 Objectives Budget
336.1 bn (0.41 of EU-GDP)
Regional competitiveness and employment objective
17.2 (EUR 57.9 bn.)
Art. 3-7 and 15-18 Gen.Reg. and Fin. Perspect.
European territorial co-operation
objective 3.94 (EUR 13.2 bn.)