LESSONS LEARNT FROM MANAGING STRUCTURAL FUND PROGRAMMES: AN ENGLISH VIEW
Overview:
The aim is to identify key aspects of successful programme management, providing a basis for effective delivery during 2007-13. The methodology is to consider aspects of Programme management, based on considerable personal experience. Issues to be examined include:
The difficulties of keeping a balance between maintaining quality in interventions, while meeting challenging annual expenditure targets: successful delivery.
The contributions that formal and informal evaluations and a more rigorous approach to project monitoring can make to successful programme management.
The roles of the Managing Authority, the Programme Secretariat and partnerships in successful programme delivery.
Wherever possible, practical advice and suggestions, based on experience, and with a view to helping others to avoid difficult management issues will be offered.
1) Introduction: personal and organisational information;
I have been involved in the preparation, management, delivery and evaluation of Objective 2 Structural Funds Programmes since 1989. The current Programme cycle is my fifth. My present position is Team Leader, European Strategy and Communications in the North East of England Programme Secretariat, based in Government Office North East.
2) Background: region, programme or project to be presented;
The region’s Objective 2 Programme is valued at 746m euros (80% ERDF, 20% ESF).
At the time of writing (September 2005) the North East is the only English region to have met its three N+2 targets for 2005: ERDF and ESF Objective 2 and ESF Objective 3.
3). Delivery (1) the right projects
Experience shows that Structural Fund Programmes can be heavily over subscribed: demand for resources can easily outstrip supply. To help to balance the equation selection procedures are needed: many models have been developed, and a common starting point, in the interests of transparency, is the scoring system, with points awarded or deducted for a variety of factors. But there is a danger that numerical selection processes reward the best writers of applications, and not necessarily the best projects. This approach to selection should preferably be supplemented with a degree of subjectivity.
An alternative to open ended competition and selection is commissioning. This is a process whereby partners agree a specification for projects, and then Programme Managers go about the business of identifying organisations that are capable of bringing the right projects forward.
For this process to work, the partnership must have agreed a strategic direction for the programme – and this feeds back to the need to get the Programme right at the preparation stage.
4) Delivery (2): N+2
It is vital that projects demonstrate sound financial performance because there is a direct relationship with Programme performance: if the projects that make up a Programme are not spending to schedule then the risk of decommitment of funds under the N+2 rule becomes greater.
To avoid N+2 penalties Programme managers must ensure that systems are in place to identify projects that are not performing well, and be ready to provide assistance – in submitting claims for example – or take remedial action – including withdrawing support from under performing projects. Tactics that have been developed include the categorisation of projects as red, amber or green, with red projects being those that have missed a payment claim or are more than 20% away from their projected expenditure profile. This information needs to be checked every month, and steps taken to move projects form re d to green or amber. Where significantly underperformance is noted, new contracts are negotiated, and funds that are freed are recycled to projects that can demonstrate a good expenditure record.
5) Evaluation and Monitoring
Although Programmes are evaluated at three stages in the life cycle, the mid term stage is probably the most important. This evaluation is equivalent to a Programme health check. A successful evaluation will be hard hitting and completely impartial. It should draw attention to aspects of the Programme that are not succeeding and should conclude with a dynamic set of recommendations, to be maintained by the partnership. Failure to act on recommendations represents a failure to deliver a high quality programme.
The current mid term update is an interesting exercise in checking and validating performance data. Early results in NE England confirm that there are wide variations in the way organisations calculate outputs such as jobs, visitor numbers and SME turnover.
Informal evaluation work – conducted at the request of the partnership and looking at particular aspects of Programme content or processes is also a valuable tool in driving up quality.
Evaluation and monitoring are two ends of the same spectrum. A good monitoring visit will share the same characteristics of a successful evaluation. In recent experience monitoring has revealed where projects are seriously deficient, particularly when it comes to meeting the requirements of the SG Regulations in fields such as retention of documents, procurement and publicity. Failure on any of these fronts can result in grant repayment, as evidenced by recent audit visits. Monitoring is also an important component in the N+2 process, providing the monitoring team with an opportunity to look carefully at the realism of expenditure forecasts.
6) Role of Managing Authority
The use of the word “Managing” is vital: Programmes do not run themselves – the many actors in a Programme rarely see the sum of the parts but understandably tend to focus on their own project(s) or field of interest. It is the role of programme managers to bring the parts together into a coherent whole.
But successful management requires also flexibility and the ability to manage competing partner expectations while remaining broadly impartial or neutral in the process of securing funds.
A key function of the Managing Authority is to ensure that dealings with the Commission during the life of the programme are effective. In a successfully managed programme the Commission’s profile should be low – engaging the partnership only through events such as PMC meetings.
7) Proactive Secretariat: skills and experience
The Secretariat is the embodiment of the Managing Authority – and to manage successfully it needs to be able to deploy a wide range of skills in a proactive fashion. These skills should include expertise in regional and economic development, awareness of project appraisal methodologies, financial management (including accountancy skills) and dedicated expertise in publicity and communications and the cross cutting themes.
This body of expertise should not be confined to an office but should be deployed throughout the partnership, building relationships and maintaining a constructive dialogue with all organisations involved in the Programme.
Crucially, the Secretariat can not wait for things to happen, but must be involved in a constant process of tasks such as helping to develop the type of projects that the Programme needs, chasing and checking expenditure claims, actively monitoring as many projects as possible and disseminating best practice .
8) Role of partnership
While the Secretariat can take the lead in bringing the Programme together and ensuring that it is meeting its performance and financial objectives this can best be achieved by helping to develop capacity in the partnership so that organisations participating in the Programme have their own experts who can meet Programme managers’ requirements. Ideally every project should have its own champion – a nominated official who can guide the project through its life from pre-application to final claim stages.
Also, opportunities should be given for personnel from the partnership to become more aware of the Programme as a whole, through activities such as secondment to, or work shadowing in, the Secretariat.
9) The Future
The draft Structural fund Regulations envisage that many of the practices and themes of the current Programming period will continue. Certainly the well established principles of partnership, evaluation, added value, effective financial management and delivery will remain at the heart of Programme implementation.
But the future will be different. New levels of strategic context will sharpen the content and focus of Programmes; the removal of the Programme Complement will simplify matters especially regarding financial management whereby the ability to carry out transactions at priority, rather than Measure, level is very welcome. A question mark remains over the Performance Reserve: if it is abandoned then one of the most key justifications for ensuring that projects are delivering relevant outputs will be removed. N+2 will remain – and there is still much to be learnt about successfully avoiding decommitment.
10) Conclusions
To conclude, a definition of successful Programme management is offered:
“Ensuring that the Programme includes high quality projects, all helping to ensure that financial and performance targets are met in the context of a clear strategic direction that is supported by a partnership that is committed to meeting Programme objectives.“
Communication details:
Peter Smith - Team Leader, European Strategy and Communications
Government Office North East, Citygate, Gallowgate, Newcastle upon Tyne, NE3 4WHWebsite: europeanfundingne.co.uk E mail: peter.smith@gone.gsi.gov.uk
7.21.2006
Information/communication – lessons learned in Sweden
Information/communication – lessons learned in Sweden
This presentation will be about story telling. I have chosen this expression because I think it is often more to the point and easier to understand than Information-communication.
I will focus on storytelling to the media and by the media. What can we do, as officials, to help the media to tell some of the very interesting and thrilling stories that are to tell about the structural fund’s interventions?
There will always be brochures and leaflets and websites and advertising, but there is nothing like the media when credibility is concerned.
My name is Maria Evertsson. I work as a communication officer at Nutek, a Swedish state agency dealing with business development and structural funds. I have worked with EU-related issues since Sweden became a member in 1995. Before that I worked as a journalist.
My e-mail adress is: Maria.evertsson@nutek.se
I will divide my presentation into three parts:
The media situation
Success factors
Difficulties
I hope that you will get some new ideas and maybe a slightly different perspective on the important and interesting task to inform and communicate the structural funds.
The media situation
It is important to analyze the media situation of your country before planning activities towards the press. In Sweden the local and regional press are very important. Sweden is a country of newspaper readers.
Of course television also has great impact. And the radio. There are similar studies done that show what kind of programmes people watch the most etc. It has not yet been the case in Sweden but I know that other member states have actually produced soap operas with a structural funds theme.
In brief, you need to look at what your media situation looks like. And do not hesitate to investigate new approaches to working with the media.
Success factors
What does it take to make a good story or facilitate for the media to make a good story?
These could be boiled down to three main points:
Pictures
People
Plot
Pictures
Pictures are very important. You know what they say; a good picture says more than a thousand words. It is important to try to show the projects in their real environment. If you can provide good picture opportunities you are more likely to make it to the front page than if you don’t. Most things are better than to show a person behind a desk or behind a computer. Of course, if you do not have any other alternatives, at least make sure there is a European flag nearby.
Where pictures are concerned I would like to mention the fantastic photos on the walls of the DG Regio info.
They come from structural fund’s projects from throughout Europe.
I think they would make an excellent exhibition in airports.
I want to show you a couple of examples where the pictures have been crucial.
People
A good story needs people, main characters. Who is a good starring person in a structural fund’s story?
One is definitely the project manager. The person in charge of a project. It could also be the local representative of the structural funds. I have chosen to call this person a local hero.
And from a structural funds perspective there should be millions of local heroes across Europe. They all have in common that they are doing something good for their local community.
Other important main characters in a story are external visitors for example in connection with structural fund’s monitoring committee meetings.
The two of them can be put together very successfully.
And of course, the participants of a project are important.
Plot
What is a good structural fund’s plot? What makes your story interesting? Of course if there is suspicion of crime involved, it immediately catches the attention. One thing that we have tried is to deliver a press release with lists of projects that have been approved for EU-funding. The information is very brief; only the name of the project, roughly what it is about and the amount of money granted.
Another way of creating an interesting plot is to arrange competitions between projects. You select a winning project that will be in the centre of attention.
Difficulties
Dealing with the local and regional media is fairly easy. There are a lot of newspapers and they are often, not always, quite happy to be invited to press conferences. The national press is much more reluctant. The local hero angle is not that interesting. Neither is the list of projects. I have tried making press releases about the financial state of play for the structural funds. But of course that information lacks the flesh and blood that I have already mentioned as being reliable success factors.
There is also reluctance towards everything that smells propaganda. You need to be careful. And the terminology is not on our side. Try to explain to somebody outside the structural fund’s system what the function of the monitoring committee is. The EU-jargon puts itself as a filter between the messenger and the people he or she is trying to address.
I have no good solutions to the problems. The only thing I think is useful is to try to use as normal words as possible. And to try to put yourself in the position of the “normal” citizen every now and then.
Conclusions
Media is good from a credibility point of view – but a media analysis is needed. The media situation varies between member states.
To help the media to deliver interesting stories you need to identify people and plot. You also need to be able to provide good photo opportunities.
Local and regional media are, in general, more interested than the national press. Maybe you will have to choose.
And finally: think story telling instead of information/communication!
This presentation will be about story telling. I have chosen this expression because I think it is often more to the point and easier to understand than Information-communication.
I will focus on storytelling to the media and by the media. What can we do, as officials, to help the media to tell some of the very interesting and thrilling stories that are to tell about the structural fund’s interventions?
There will always be brochures and leaflets and websites and advertising, but there is nothing like the media when credibility is concerned.
My name is Maria Evertsson. I work as a communication officer at Nutek, a Swedish state agency dealing with business development and structural funds. I have worked with EU-related issues since Sweden became a member in 1995. Before that I worked as a journalist.
My e-mail adress is: Maria.evertsson@nutek.se
I will divide my presentation into three parts:
The media situation
Success factors
Difficulties
I hope that you will get some new ideas and maybe a slightly different perspective on the important and interesting task to inform and communicate the structural funds.
The media situation
It is important to analyze the media situation of your country before planning activities towards the press. In Sweden the local and regional press are very important. Sweden is a country of newspaper readers.
Of course television also has great impact. And the radio. There are similar studies done that show what kind of programmes people watch the most etc. It has not yet been the case in Sweden but I know that other member states have actually produced soap operas with a structural funds theme.
In brief, you need to look at what your media situation looks like. And do not hesitate to investigate new approaches to working with the media.
Success factors
What does it take to make a good story or facilitate for the media to make a good story?
These could be boiled down to three main points:
Pictures
People
Plot
Pictures
Pictures are very important. You know what they say; a good picture says more than a thousand words. It is important to try to show the projects in their real environment. If you can provide good picture opportunities you are more likely to make it to the front page than if you don’t. Most things are better than to show a person behind a desk or behind a computer. Of course, if you do not have any other alternatives, at least make sure there is a European flag nearby.
Where pictures are concerned I would like to mention the fantastic photos on the walls of the DG Regio info.
They come from structural fund’s projects from throughout Europe.
I think they would make an excellent exhibition in airports.
I want to show you a couple of examples where the pictures have been crucial.
People
A good story needs people, main characters. Who is a good starring person in a structural fund’s story?
One is definitely the project manager. The person in charge of a project. It could also be the local representative of the structural funds. I have chosen to call this person a local hero.
And from a structural funds perspective there should be millions of local heroes across Europe. They all have in common that they are doing something good for their local community.
Other important main characters in a story are external visitors for example in connection with structural fund’s monitoring committee meetings.
The two of them can be put together very successfully.
And of course, the participants of a project are important.
Plot
What is a good structural fund’s plot? What makes your story interesting? Of course if there is suspicion of crime involved, it immediately catches the attention. One thing that we have tried is to deliver a press release with lists of projects that have been approved for EU-funding. The information is very brief; only the name of the project, roughly what it is about and the amount of money granted.
Another way of creating an interesting plot is to arrange competitions between projects. You select a winning project that will be in the centre of attention.
Difficulties
Dealing with the local and regional media is fairly easy. There are a lot of newspapers and they are often, not always, quite happy to be invited to press conferences. The national press is much more reluctant. The local hero angle is not that interesting. Neither is the list of projects. I have tried making press releases about the financial state of play for the structural funds. But of course that information lacks the flesh and blood that I have already mentioned as being reliable success factors.
There is also reluctance towards everything that smells propaganda. You need to be careful. And the terminology is not on our side. Try to explain to somebody outside the structural fund’s system what the function of the monitoring committee is. The EU-jargon puts itself as a filter between the messenger and the people he or she is trying to address.
I have no good solutions to the problems. The only thing I think is useful is to try to use as normal words as possible. And to try to put yourself in the position of the “normal” citizen every now and then.
Conclusions
Media is good from a credibility point of view – but a media analysis is needed. The media situation varies between member states.
To help the media to deliver interesting stories you need to identify people and plot. You also need to be able to provide good photo opportunities.
Local and regional media are, in general, more interested than the national press. Maybe you will have to choose.
And finally: think story telling instead of information/communication!
The regional dimension to the Lisbon Process
Prof. Andrew Scott
University of Edinburgh, School of Law
Old College
Edinburgh EH10 4HX
United Kingdom
andrew.scott@ed.ac.uk
The regional dimension to the Lisbon Process.
The central argument developed in the presentation is that the governance of the Lisbon Strategy lacks a structured "regional dimension", and that this omission is a major weakness of the entire process. The resulting weakness is twofold. First, as a matter of achieving the substantive Lisbon objectives within the economic pillar, the absence of a structured regional dimension risks excluding from the strategy a range of sub-state governments, administrations and economic stakeholders responsible for devising and delivering those economic policies 'locally' which will shape the overall rate of growth of output and employment across the EU. Socio-economic development actually occurs at the local level, yet there is no EU-wide discussion on the best-practice approach to including local economic players within the Lisbon process generally, or the OMC governance arrangement specifically. Instead, the LS is essentially a "top-down" strategy. Second, the absence of a formal role nationally for local economic governments and related stakeholders to be involved in the Lisbon process risks weakening the legitimacy of the venture. The principle of subsidiarity asserts that decisions should be taken as closely to the citizen as possible. This principle is designed not only to ensure that policies are shaped according to differing local circumstances, but also to maximise the involvement of 'local' stakeholders in the setting the objectives and designing the delivery of economic policies. The OMC process which governs the LS makes little or no mention to this principle.
This presentation focuses solely on the economic, or "competitiveness" strand of the Lisbon process. We ignore the social inclusion and environmental strands, although certainly the arguments developed here can be extended to include these other two pillars of the LS. Our critique is presented in two parts. In the first part we consider the implementation of the LS in terms of the substantive economic reforms which it intends to achieve in order to promote the Lisbon objectives. In particular, we examine the role that local economic actors have in the economic development process upon which success in a number of the Lisbon targets depends. In the second section we briefly consider the 'legitimacy' dimension to the LS, and once again focus on the role of regional authorities in legitimating the sometimes problematic economic policy measures that are required if the LS is to succeed.
To date the Lisbon process has been dominated by national governments to the relative exclusion of regional authorities. Arguably this leads to two defects in the process: the first is a failure to successfully achieve a degree of policy learning or policy transfer at the level of national governments who largely remain unwilling to alter national policies in pursuit of a common (or coordinated) EU policy approach; the second defect is the presumption that Member State governments are themselves able to deliver on many of the policy reforms that are required to achieve the economic objectives of the Lisbon strategy. Within many domestic policy arrangements across the EU, competence for a range of the substantive economic policy instruments in question reside at the sub-state level and not the national level. The risk at present is that the potential role for regions independently to contribute to achieving the Lisbon objectives will remain untapped. For example, in a recent joint letter to Commissioner Verhuegen, three Ministers of the UK Government noted that "(T)he Lisbon objectives must primarily be delivered through national actions and structural economic reforms." While one could interpret "national actions" to embrace the development of a specific and distinct regional dimension inputting to the Lisbon Strategy, our view is that such a dimension has to be explicitly acknowledged and be an integral part of such "national actions" through inclusion in the revised National Action Plans.
It is clear from many documents that the European Commission is determined to mainstream the Lisbon agenda throughout its economic, social and environmental policies. This is a significant step towards improving the prospects that the ultimate targets of the exercise will be achieved. However, in itself EU policies only play a relatively small part in delivering growth and employment. The burden of responsibility remains with national governments. However, national governments remain unconvincing participants in delivering the strategy. The OMC system is failing, and the proliferation of national targets is threatening to worsen an already confusing picture. While injecting a strong regional element to the Lisbon process cannot remedy all the defects in the current procedures, it can alleviate some. In particular, we suggest (a) sub-state authorities have to be closely involved in national Lisbon programmes as not only have they better knowledge of local economic circumstances, in many instances they are the competent authority with regard to particular Lisbon-related policies: (b) both theory and evidence supports the contention that sub-state authorities are more likely to “learn” from one another through established inter-regional networks, most of which involve policy transfer in relation to economic development: (c) sub-state authorities and their associated parliaments and assemblies offer crucial conduits through which the policy reforms and measures required to deliver Lisbon targets can best be legitimated, and so raise the likelihood that these will be realised: and (d) social-economic development occurs at the level of regions rather than nation states, and sub-state authorities are better placed than national governments to bring into the Lisbon process the various economic and social partners who are the key stakeholders in the Lisbon process and therefore to offer greater prospect of its ultimate success.
In conclusion, the arguments developed in the presentation point to the importance of energizing the regional debate over the Lisbon strategy. Undoubtedly there are regions who are already heavily involved in the Lisbon process, and successfully so. It is vital that best-practice lessons are learned from those regions, both in terms of the structures through which their involvement takes place and with regard to the substantive policy measures that these authorities are implementing.
University of Edinburgh, School of Law
Old College
Edinburgh EH10 4HX
United Kingdom
andrew.scott@ed.ac.uk
The regional dimension to the Lisbon Process.
The central argument developed in the presentation is that the governance of the Lisbon Strategy lacks a structured "regional dimension", and that this omission is a major weakness of the entire process. The resulting weakness is twofold. First, as a matter of achieving the substantive Lisbon objectives within the economic pillar, the absence of a structured regional dimension risks excluding from the strategy a range of sub-state governments, administrations and economic stakeholders responsible for devising and delivering those economic policies 'locally' which will shape the overall rate of growth of output and employment across the EU. Socio-economic development actually occurs at the local level, yet there is no EU-wide discussion on the best-practice approach to including local economic players within the Lisbon process generally, or the OMC governance arrangement specifically. Instead, the LS is essentially a "top-down" strategy. Second, the absence of a formal role nationally for local economic governments and related stakeholders to be involved in the Lisbon process risks weakening the legitimacy of the venture. The principle of subsidiarity asserts that decisions should be taken as closely to the citizen as possible. This principle is designed not only to ensure that policies are shaped according to differing local circumstances, but also to maximise the involvement of 'local' stakeholders in the setting the objectives and designing the delivery of economic policies. The OMC process which governs the LS makes little or no mention to this principle.
This presentation focuses solely on the economic, or "competitiveness" strand of the Lisbon process. We ignore the social inclusion and environmental strands, although certainly the arguments developed here can be extended to include these other two pillars of the LS. Our critique is presented in two parts. In the first part we consider the implementation of the LS in terms of the substantive economic reforms which it intends to achieve in order to promote the Lisbon objectives. In particular, we examine the role that local economic actors have in the economic development process upon which success in a number of the Lisbon targets depends. In the second section we briefly consider the 'legitimacy' dimension to the LS, and once again focus on the role of regional authorities in legitimating the sometimes problematic economic policy measures that are required if the LS is to succeed.
To date the Lisbon process has been dominated by national governments to the relative exclusion of regional authorities. Arguably this leads to two defects in the process: the first is a failure to successfully achieve a degree of policy learning or policy transfer at the level of national governments who largely remain unwilling to alter national policies in pursuit of a common (or coordinated) EU policy approach; the second defect is the presumption that Member State governments are themselves able to deliver on many of the policy reforms that are required to achieve the economic objectives of the Lisbon strategy. Within many domestic policy arrangements across the EU, competence for a range of the substantive economic policy instruments in question reside at the sub-state level and not the national level. The risk at present is that the potential role for regions independently to contribute to achieving the Lisbon objectives will remain untapped. For example, in a recent joint letter to Commissioner Verhuegen, three Ministers of the UK Government noted that "(T)he Lisbon objectives must primarily be delivered through national actions and structural economic reforms." While one could interpret "national actions" to embrace the development of a specific and distinct regional dimension inputting to the Lisbon Strategy, our view is that such a dimension has to be explicitly acknowledged and be an integral part of such "national actions" through inclusion in the revised National Action Plans.
It is clear from many documents that the European Commission is determined to mainstream the Lisbon agenda throughout its economic, social and environmental policies. This is a significant step towards improving the prospects that the ultimate targets of the exercise will be achieved. However, in itself EU policies only play a relatively small part in delivering growth and employment. The burden of responsibility remains with national governments. However, national governments remain unconvincing participants in delivering the strategy. The OMC system is failing, and the proliferation of national targets is threatening to worsen an already confusing picture. While injecting a strong regional element to the Lisbon process cannot remedy all the defects in the current procedures, it can alleviate some. In particular, we suggest (a) sub-state authorities have to be closely involved in national Lisbon programmes as not only have they better knowledge of local economic circumstances, in many instances they are the competent authority with regard to particular Lisbon-related policies: (b) both theory and evidence supports the contention that sub-state authorities are more likely to “learn” from one another through established inter-regional networks, most of which involve policy transfer in relation to economic development: (c) sub-state authorities and their associated parliaments and assemblies offer crucial conduits through which the policy reforms and measures required to deliver Lisbon targets can best be legitimated, and so raise the likelihood that these will be realised: and (d) social-economic development occurs at the level of regions rather than nation states, and sub-state authorities are better placed than national governments to bring into the Lisbon process the various economic and social partners who are the key stakeholders in the Lisbon process and therefore to offer greater prospect of its ultimate success.
In conclusion, the arguments developed in the presentation point to the importance of energizing the regional debate over the Lisbon strategy. Undoubtedly there are regions who are already heavily involved in the Lisbon process, and successfully so. It is vital that best-practice lessons are learned from those regions, both in terms of the structures through which their involvement takes place and with regard to the substantive policy measures that these authorities are implementing.
Preparing structural funds programmes for 2007-2013
Preparing structural funds programmes
for 2007-2013
Presentation: Felicia DARELL
(felicia.darell@midi-pyrenees.pref.gouv.fr)
Tel : 05 34 45 33 12 – Fax: 05 34 45 33 04
Prefecture of Midi-Pyrenees region - Europe department - control unit
Contact:
Secretary General: Didier FRANCOIS
Control Service: Head of Unit: Claude SAINT-MICHEL
Prefecture of Midi-Pyrenees Region
SGAR, Europe Service
1, place Saint-Etienne
31038 Toulouse cedex
FRANCE
Website: http://haute-garonne.pref.gouv.fr
Introduction: Practice of structural funds in Midi-Pyrenees:
Presentation of the particularities of the region and the management of structural funds in 2000-2006 programming area
§ Managing structural funds in France
Level 1: European Commission
Level 2: Member State/National level
Level 3: Local Governement/Prefecture of Midi-Pyrénées: Mananing authority/control unit/Partnership regional and local partners
The organisation of the partnership differs according to the implementation stages:
• Objective 2 programme /managing authority: the Prefet’s responsibility
partnership with a regional authority, the regional council at different stages (from the preparation, to the management and the global grant procedure).
• INTERREG III A and B/managing authority: Regional council
French-Spanish cross-border programme: management/the Regional council of Aquitaine/role and responsibility of the Spanish authorities/the local government/the Prefet of Midi-Pyrenees, co-ordination role
Trans-national programme “SUDOE”: managing authority: Spanish authority of Cantabria partnership with the Regional council of Midi-Pyrenees for France and representatives of Portugal and United-Kingdom
Development of positive aspects and improvements to be made for the future generation
Tendency for 2007-2013 programming area: decentralisation and member states’ responsibility: an active control and audit system
1. Preparing structural funds programmes: Practice in Midi-Pyrenees
§ Positive aspects and improvements to be made for the future generation: necessity to co-ordinate structural funds policy with the framework of the state-region planning contracts
A stronger role for the regions and Partnership
shared management between the European, national, regional involving regional, urban, local and other authorities, economic and social partners and civil society, environmental organisations.
Decentralisation
The management of programmes being financed by structural funds is the responsibility of the member state. In France, we are in the second phase of decentralisation and the new legislation has mentioned the possibility of transferring the management of structural funds to the regions to the local or regional authorities for the next generation of programmes.
Audit system (2000-2006)
EUROPEAN LEVEL : European Commission DG REGIO
NATIONAL LEVEL : CICC (commission in charge of the co-ordination of all the verifications
LOCAL LEVEL : Prefecture of Midi-Pyrenees (SGAR : general secretariat for regional affairs)
At the local level, there are divisions:
· The managing authority in charge of the Objective 2 programme
· The payment authority responsible for certifying statements of expenditure
· The independent control division : This control authority is composed of 4 civil servants with specific missions (to control operations: 5% of total eligible expenditure):
The Member’s State responsibility/example of INTERREG III A audit system
2. AGENDA
September 2004 - March 2005: strategic study group working on the national strategic reference framework (national level: DATAR)
May - June 2005: regional debate involving the partnership principle
June 2005: regional contributions sent to the national level
September 2005: National presentation
November 2005: DATAR
December 2005: final version
End 2005: decision by Council and European commission
Beginning of 2006: Council adopts community strategic guidelines on cohesion
2006: preparation of programmes for period 2007-2013
1st January 2007: Implementation begins
3. MIDI-PYRENEES CONTRIBUTION TO THE REGIONAL DEBATE
METHODOLOGY
DATAR prepared an introductive document (preparation for the national strategic reference framework) and at regional level: regional debate on the 8th June with 4 workshops:
“ Innovation and entrepreneurship ”
“ access to transport services of general economic interest ”
“ environment and risk prevention ”
“cross-border, transnational, interregional ”
The Prefet invited the State services, local and regional partnership the 8th June 2005 for their contribution to the national strategic reference framework. Over 100 people, participated and were present at the seminar.
The introductive document from the DATAR was sent to all the participants a month before the seminar, the proposals for the Structural Funds regulations for the period 2007-2013 were distributed on the 8th June.
The following seminar is taking place in Toulouse the 20th September 2005
ORGANISATION
• Introduction and presentation by the Prefet, the vice-president of the regional authority (Regional Council), the DATAR and DG REGIO, European Commission
• 4 workshops: Innovation and entrepreneurship, access to transport services of general economic interest, environment and risk prevention, cross-border, transnational, interregional.
Innovation and entrepreneurship
- Reinforce research and technological development
- Themes such as R&D and innovation and direct aids to SMEs
Transport
Reinforce accessibility to competitive and economic sectors: rail for instance/priority could be given to connections with other regions and with Spain (transport in the Pyrenees, over 800 lorries per day, rail could be part of the strategy) - line Narbonne-Toulouse-Bordeaux or Toulouse-Limoges-Orleans-Paris/Sustainable development with emphasis on rail is a priority
Environment and risk prevention
Risk prevention: the notion of risk can be extended to climate risks, pollution risks (air... )
Midi-Pyrénées region : - major flood risk
- mountain zone/vulnerable areas
Cross-border, transnational, interregional
INTERREG IIIA accessibility (experimentations of rail: Latour-de-Carol), cultural theme : strong preoccupation
INTERREG III B: discussions about the SUDOE zonage
INTERREGIONAL co-operation INTERREG 3 C : Emphasis on co-operation economic sector (ex aeronautic sector /co-operation with Hamburg and Seville …)
Concerning the management aspect the division of responsibility must clear between the Member State, the region and the implementation bodies. In Midi-Pyrenees, no decision has been taken in this matter.
for 2007-2013
Presentation: Felicia DARELL
(felicia.darell@midi-pyrenees.pref.gouv.fr)
Tel : 05 34 45 33 12 – Fax: 05 34 45 33 04
Prefecture of Midi-Pyrenees region - Europe department - control unit
Contact:
Secretary General: Didier FRANCOIS
Control Service: Head of Unit: Claude SAINT-MICHEL
Prefecture of Midi-Pyrenees Region
SGAR, Europe Service
1, place Saint-Etienne
31038 Toulouse cedex
FRANCE
Website: http://haute-garonne.pref.gouv.fr
Introduction: Practice of structural funds in Midi-Pyrenees:
Presentation of the particularities of the region and the management of structural funds in 2000-2006 programming area
§ Managing structural funds in France
Level 1: European Commission
Level 2: Member State/National level
Level 3: Local Governement/Prefecture of Midi-Pyrénées: Mananing authority/control unit/Partnership regional and local partners
The organisation of the partnership differs according to the implementation stages:
• Objective 2 programme /managing authority: the Prefet’s responsibility
partnership with a regional authority, the regional council at different stages (from the preparation, to the management and the global grant procedure).
• INTERREG III A and B/managing authority: Regional council
French-Spanish cross-border programme: management/the Regional council of Aquitaine/role and responsibility of the Spanish authorities/the local government/the Prefet of Midi-Pyrenees, co-ordination role
Trans-national programme “SUDOE”: managing authority: Spanish authority of Cantabria partnership with the Regional council of Midi-Pyrenees for France and representatives of Portugal and United-Kingdom
Development of positive aspects and improvements to be made for the future generation
Tendency for 2007-2013 programming area: decentralisation and member states’ responsibility: an active control and audit system
1. Preparing structural funds programmes: Practice in Midi-Pyrenees
§ Positive aspects and improvements to be made for the future generation: necessity to co-ordinate structural funds policy with the framework of the state-region planning contracts
A stronger role for the regions and Partnership
shared management between the European, national, regional involving regional, urban, local and other authorities, economic and social partners and civil society, environmental organisations.
Decentralisation
The management of programmes being financed by structural funds is the responsibility of the member state. In France, we are in the second phase of decentralisation and the new legislation has mentioned the possibility of transferring the management of structural funds to the regions to the local or regional authorities for the next generation of programmes.
Audit system (2000-2006)
EUROPEAN LEVEL : European Commission DG REGIO
NATIONAL LEVEL : CICC (commission in charge of the co-ordination of all the verifications
LOCAL LEVEL : Prefecture of Midi-Pyrenees (SGAR : general secretariat for regional affairs)
At the local level, there are divisions:
· The managing authority in charge of the Objective 2 programme
· The payment authority responsible for certifying statements of expenditure
· The independent control division : This control authority is composed of 4 civil servants with specific missions (to control operations: 5% of total eligible expenditure):
The Member’s State responsibility/example of INTERREG III A audit system
2. AGENDA
September 2004 - March 2005: strategic study group working on the national strategic reference framework (national level: DATAR)
May - June 2005: regional debate involving the partnership principle
June 2005: regional contributions sent to the national level
September 2005: National presentation
November 2005: DATAR
December 2005: final version
End 2005: decision by Council and European commission
Beginning of 2006: Council adopts community strategic guidelines on cohesion
2006: preparation of programmes for period 2007-2013
1st January 2007: Implementation begins
3. MIDI-PYRENEES CONTRIBUTION TO THE REGIONAL DEBATE
METHODOLOGY
DATAR prepared an introductive document (preparation for the national strategic reference framework) and at regional level: regional debate on the 8th June with 4 workshops:
“ Innovation and entrepreneurship ”
“ access to transport services of general economic interest ”
“ environment and risk prevention ”
“cross-border, transnational, interregional ”
The Prefet invited the State services, local and regional partnership the 8th June 2005 for their contribution to the national strategic reference framework. Over 100 people, participated and were present at the seminar.
The introductive document from the DATAR was sent to all the participants a month before the seminar, the proposals for the Structural Funds regulations for the period 2007-2013 were distributed on the 8th June.
The following seminar is taking place in Toulouse the 20th September 2005
ORGANISATION
• Introduction and presentation by the Prefet, the vice-president of the regional authority (Regional Council), the DATAR and DG REGIO, European Commission
• 4 workshops: Innovation and entrepreneurship, access to transport services of general economic interest, environment and risk prevention, cross-border, transnational, interregional.
Innovation and entrepreneurship
- Reinforce research and technological development
- Themes such as R&D and innovation and direct aids to SMEs
Transport
Reinforce accessibility to competitive and economic sectors: rail for instance/priority could be given to connections with other regions and with Spain (transport in the Pyrenees, over 800 lorries per day, rail could be part of the strategy) - line Narbonne-Toulouse-Bordeaux or Toulouse-Limoges-Orleans-Paris/Sustainable development with emphasis on rail is a priority
Environment and risk prevention
Risk prevention: the notion of risk can be extended to climate risks, pollution risks (air... )
Midi-Pyrénées region : - major flood risk
- mountain zone/vulnerable areas
Cross-border, transnational, interregional
INTERREG IIIA accessibility (experimentations of rail: Latour-de-Carol), cultural theme : strong preoccupation
INTERREG III B: discussions about the SUDOE zonage
INTERREGIONAL co-operation INTERREG 3 C : Emphasis on co-operation economic sector (ex aeronautic sector /co-operation with Hamburg and Seville …)
Concerning the management aspect the division of responsibility must clear between the Member State, the region and the implementation bodies. In Midi-Pyrenees, no decision has been taken in this matter.
The Experience of Integrated Projects (Ips) for the renewed Community Structural Funds (CSFs)
The Experience of Integrated Projects (Ips) for the renewed Community Structural Funds (CSFs)
Abstract
The Campania Operational Programme shares the Community Structural Fund’s objectives to provide incentives for development throught a radical change in the programming and management of actions and stakeholder practices through Integrated Projects.
The Campania Region proposes its experience as an EU best practice. The added value of its Integrated Projects is:
a) balance between governance and government;
b) integration between funds (European Regional Development Fund – ERDF and European Social Fund – ESF) anticipating the machanisms for the new Structural Funds;
c) partnership process with local stakeholders, capacity building and transfer of know-how.
Weaknesses to be addressed are:
a) political orientation of partnerships;
b) difficulties in harmonising the timing of individual operations with the financial programming of the Operational Programme measures.
In this framework, the Campania Region will concentrate on defining technical requirements and democratic legitimacy for the management of local development interventions directly through Global Subventions. Moreover, without the limits of measures, the Campania Region will experiment mechanisms and structures to facilitate flexibility.
Abstract
The Campania Operational Programme shares the Community Structural Fund’s objectives to provide incentives for development throught a radical change in the programming and management of actions and stakeholder practices through Integrated Projects.
The Campania Region proposes its experience as an EU best practice. The added value of its Integrated Projects is:
a) balance between governance and government;
b) integration between funds (European Regional Development Fund – ERDF and European Social Fund – ESF) anticipating the machanisms for the new Structural Funds;
c) partnership process with local stakeholders, capacity building and transfer of know-how.
Weaknesses to be addressed are:
a) political orientation of partnerships;
b) difficulties in harmonising the timing of individual operations with the financial programming of the Operational Programme measures.
In this framework, the Campania Region will concentrate on defining technical requirements and democratic legitimacy for the management of local development interventions directly through Global Subventions. Moreover, without the limits of measures, the Campania Region will experiment mechanisms and structures to facilitate flexibility.
Practical guide for Structural Funds interventions
Practical guide for Structural Funds interventions
Background
Many memberstates have experience with Structural Funds operations. Yet this experience is not always in a practical way available for others nor is it transferred to other memberstates. This was the main reason to start a project to establish a practical guide. EIPA, the European institute for public administration and ERAC a specialised consultant in the Netherlands for structural funds interventions therefore took the initiative. This was made possible by the Dutch government in view of the exchange of experience to new memberstates.
Content
The guide provides practical step-by-step guidelines about all aspects of dealing with the Structural Funds on the programme as well as the project level, including tips and ways of dealing with the different issues:
- Structures and Principles
- Plans and programming (from the first step until drafting the programme documents)
- Organisation and programme bodies (description of tasks and responsibilities)
- Financial management and control
- Project development
- Project management
- Project monitoring
- Programme monitoring and
- Evaluation
The information is based on practical experience using the official guidelines. It goes beyond the guidelines and should make management in practice more simple.
Target audience
This presentation is interesting for people from the recently accessed countries (learning from best practice as well as for people working longer with the Structural Funds ( thinking about the methods used and possible improvements). It gives an overview of all important aspects and directions for the best way of dealing with these aspects. The guidelines are based on experience gained by developing, writing, managing and monitoring European funded programmes and projects.
Presentation
Luc Broos , director of ERAC will present the Guide during the session of the Open Days. He will go into detail with regard to the content , the use and the impact of the guide. A copy of the Guide is available for the participants on request.
During the presentation we expect a feedback and a lively discussion with the participants.
Luc Broos September 2005-09-08
IPM 440126
Background
Many memberstates have experience with Structural Funds operations. Yet this experience is not always in a practical way available for others nor is it transferred to other memberstates. This was the main reason to start a project to establish a practical guide. EIPA, the European institute for public administration and ERAC a specialised consultant in the Netherlands for structural funds interventions therefore took the initiative. This was made possible by the Dutch government in view of the exchange of experience to new memberstates.
Content
The guide provides practical step-by-step guidelines about all aspects of dealing with the Structural Funds on the programme as well as the project level, including tips and ways of dealing with the different issues:
- Structures and Principles
- Plans and programming (from the first step until drafting the programme documents)
- Organisation and programme bodies (description of tasks and responsibilities)
- Financial management and control
- Project development
- Project management
- Project monitoring
- Programme monitoring and
- Evaluation
The information is based on practical experience using the official guidelines. It goes beyond the guidelines and should make management in practice more simple.
Target audience
This presentation is interesting for people from the recently accessed countries (learning from best practice as well as for people working longer with the Structural Funds ( thinking about the methods used and possible improvements). It gives an overview of all important aspects and directions for the best way of dealing with these aspects. The guidelines are based on experience gained by developing, writing, managing and monitoring European funded programmes and projects.
Presentation
Luc Broos , director of ERAC will present the Guide during the session of the Open Days. He will go into detail with regard to the content , the use and the impact of the guide. A copy of the Guide is available for the participants on request.
During the presentation we expect a feedback and a lively discussion with the participants.
Luc Broos September 2005-09-08
IPM 440126
Decentralising Structural Funds' management to the regional level
Decentralising Structural Funds' management to the regional level
Decentralised programming = Decentralised implementation? Or, Why (further) decentralisation of implementation is a bad idea
Since programming will focus on the NUTS 2 level in the future, there will be a tendency to decentralise management of Structural Funds and Instruments to this level. This paper problematises the management side of this issue, arguing that decentralised programming need not automatically mean decentralised management of the programmes, and indeed that there are many reasons why, particularly in the new Member states, any (further) decentralisation of management is likely to have negative consequences. These conclusions are based on the findings of an institutional capacity measurement recently undertaken at 4 implementing agencies in one new member state (to ensure confidentiality, the results will be presented generically and anonymously). Ten criteria were used to measure capacity at existing institutions; these criteria were adapted for relevance in light of structural funds implementation requirements, and were: Governance; Management practices; Financial resources; Service delivery; Human resources; External resources; Monitoring of projects & programmes; Programme management; Administrative capacity for formulation; Management and Control of Programmes. In addition, an assessment was made of the structures for implementation of structural funds, with comparisons to EU member state institutions, on five criteria: structures for management; structures for programming; structures for implementation; structures for monitoring and evaluation; structures for financial management & control. The presentation concludes with some thoughts and recommendations for future institutional structures for implementation of structural funds.
The experience of the Management Organisation Unit of the CSF
STRUCTURAL FUNDS MANAGEMENT IN GREECE:
The experience of the Management Organisation Unit
of the CSF
Presented by:
Dex. Agourides
Director General
M.O.U. S.A.
http://www.mou.gr/ mailto:dagourides@mou.gr
EU Structural Funds in Greece
Greece is a peripheral EU country with no common land borders with other Member States. The major weaknesses of the Greek economy are infrastructure deficits, unemployment rate above the EU average, high share of employment in agriculture, low productivity (deficits in R&D, skilled workforce and business investment) and a lagging behind telecommunications sector.
The whole of the Greek territory qualifies as Objective 1 Region under the Structural Funds. There are currently 7 areas of intervention and 24 Operational Programmes (11 national and 13 regional). Key priorities:
Ø Infrastructure 56,5%
Ø Support to the private sector 21,9%
Ø Human resources development 19%
For the period 2000-2006, EU structural assistance to Greece amounts to a total of EUR 28 billion (Objective 1, Community Initiatives, Cohesion Fund).
Overall, under the regulations governing the 2000-2006 Structural Funds, there was a major transfer of responsibility to the Member States, while stricter conditions for financial management were put in place. This new regulatory framework was designed to improve effectiveness and transparency. In practice, however, the new system encountered a number of difficulties in Member States.
Implementing CSF Interventions
In Greece, CSF interventions and the tight regulatory framework required the establishment of efficient implementing bodies together with sound financial management at every level of Government. Therefore, a series of reforms in public expenditure management was introduced by law, incorporating detailed implementation procedures. Despite these reforms, several difficulties were encountered in the process of adopting the new implementation and monitoring system, mainly due to:
Ø Incompatible national systems with Community regulations
Ø Serious inflexibilities and inefficiencies in the civil service structure
Ø Inadequate coordination between government departments
Ø Lack of specialised human resources and know-how
Ø Multitude of weak and inefficient Final Beneficiaries
Ø Technological gaps
Ø Cumbersome procedures delaying implementation
Enhancing the management capacity of the Greek Civil Service
The Management Organisation Unit (M.O.U.) was established under the Community Support Framework in order to strengthen the management capacity of the CSF implementing bodies.
It is a non-profit making institution, operating under the auspices of the Ministry of Economy and Finance, but is placed outside the civil service. The Unit’s legal status (Societe Anonyme) allows it to bypass the rigid administrative procedures and inflexibilities characterising the Greek civil service. It is governed by a nine-member Board of Directors and its workforce is made up of highly qualified staff, recruited from both the private and public sector.
The MOU has played a vital role in the setting up of the CSF management structure. MOU provided the following:
Ø Selection and recruitment from the private sector of a total 830 specialists for the staffing of 40 Managing Authorities and other administrative bodies.
Ø Deployment of five Expert Teams to support final beneficiaries with management weaknesses (“flying consultants”)
Ø Elaboration of numerous management systems and tools
Ø Implementation of intensive training programmes for staff involved in the implementation of the CSF
Ø Procurement of state-of-the-art office equipment and modern infrastructure facilities for the Managing Authorities
Ø Introduction of modern information technology systems
Ø Study and preparation of innovative management systems in view of the next programming period
Conclusions
The MOU is a unique experience of administrative structure for Greece. It combines staff from both the private and public sector and provides modern infrastructure facilities and high quality services to public authorities. It is a flexible and efficient unit, with high levels of performance, able to respond immediately to a number of urgent needs and requests. Its role is to complement and not to substitute the civil service by providing efficient technical assistance to the CSF implementing authorities.
The experience of the Management Organisation Unit
of the CSF
Presented by:
Dex. Agourides
Director General
M.O.U. S.A.
http://www.mou.gr/ mailto:dagourides@mou.gr
EU Structural Funds in Greece
Greece is a peripheral EU country with no common land borders with other Member States. The major weaknesses of the Greek economy are infrastructure deficits, unemployment rate above the EU average, high share of employment in agriculture, low productivity (deficits in R&D, skilled workforce and business investment) and a lagging behind telecommunications sector.
The whole of the Greek territory qualifies as Objective 1 Region under the Structural Funds. There are currently 7 areas of intervention and 24 Operational Programmes (11 national and 13 regional). Key priorities:
Ø Infrastructure 56,5%
Ø Support to the private sector 21,9%
Ø Human resources development 19%
For the period 2000-2006, EU structural assistance to Greece amounts to a total of EUR 28 billion (Objective 1, Community Initiatives, Cohesion Fund).
Overall, under the regulations governing the 2000-2006 Structural Funds, there was a major transfer of responsibility to the Member States, while stricter conditions for financial management were put in place. This new regulatory framework was designed to improve effectiveness and transparency. In practice, however, the new system encountered a number of difficulties in Member States.
Implementing CSF Interventions
In Greece, CSF interventions and the tight regulatory framework required the establishment of efficient implementing bodies together with sound financial management at every level of Government. Therefore, a series of reforms in public expenditure management was introduced by law, incorporating detailed implementation procedures. Despite these reforms, several difficulties were encountered in the process of adopting the new implementation and monitoring system, mainly due to:
Ø Incompatible national systems with Community regulations
Ø Serious inflexibilities and inefficiencies in the civil service structure
Ø Inadequate coordination between government departments
Ø Lack of specialised human resources and know-how
Ø Multitude of weak and inefficient Final Beneficiaries
Ø Technological gaps
Ø Cumbersome procedures delaying implementation
Enhancing the management capacity of the Greek Civil Service
The Management Organisation Unit (M.O.U.) was established under the Community Support Framework in order to strengthen the management capacity of the CSF implementing bodies.
It is a non-profit making institution, operating under the auspices of the Ministry of Economy and Finance, but is placed outside the civil service. The Unit’s legal status (Societe Anonyme) allows it to bypass the rigid administrative procedures and inflexibilities characterising the Greek civil service. It is governed by a nine-member Board of Directors and its workforce is made up of highly qualified staff, recruited from both the private and public sector.
The MOU has played a vital role in the setting up of the CSF management structure. MOU provided the following:
Ø Selection and recruitment from the private sector of a total 830 specialists for the staffing of 40 Managing Authorities and other administrative bodies.
Ø Deployment of five Expert Teams to support final beneficiaries with management weaknesses (“flying consultants”)
Ø Elaboration of numerous management systems and tools
Ø Implementation of intensive training programmes for staff involved in the implementation of the CSF
Ø Procurement of state-of-the-art office equipment and modern infrastructure facilities for the Managing Authorities
Ø Introduction of modern information technology systems
Ø Study and preparation of innovative management systems in view of the next programming period
Conclusions
The MOU is a unique experience of administrative structure for Greece. It combines staff from both the private and public sector and provides modern infrastructure facilities and high quality services to public authorities. It is a flexible and efficient unit, with high levels of performance, able to respond immediately to a number of urgent needs and requests. Its role is to complement and not to substitute the civil service by providing efficient technical assistance to the CSF implementing authorities.
MANAGING STRUCTURAL FUNDS AND INSTRUMENTS
MANAGING STRUCTURAL FUNDS AND INSTRUMENTS
ADDRESSING THE ABSORPTION CAPACITY IN THE NEW MEMBER STATES
Mr Stephen O’Sullivan
Assistant Secretary
Banking Finance and International Division
Department of Finance, Ireland
______________________
Introduction
The enlargement of the Union to 25 members and the prospective further enlargements present unprecedented challenges for the Union as a whole and for its constituent Member States. One of these concerns the successful and productive absorption of the very considerable volume of resources to be transferred from the Member States with above average levels of development to those which are catching up.
There are many aspects to the challenge of absorption. I will say a few words about the overall level of financial commitment involved and talk about the challenges that we in Ireland had to overcome in utilising the funding placed at our disposal from the Union Budget over the years. I am fully aware of course that what may have worked reasonably well in one particular setting does not necessarily constitute a model which all will find appropriate for their particular circumstances. Nonetheless, I do hope that some of the lessons that we ourselves have drawn from our experience of planning, drawing down and implementing the Funds will resonate with you.
My main messages to you today will be
The absorption challenges facing the new Member States are greater that those which we in Ireland had to address;
We overcame our challenges by concentrating on partnerships and planning. The main focus of this paper is around these points; and
Our efforts paid off. Thanks to the structural funding transferred to us by our fellow EU Member States, Ireland’s level of GNP on a sustained basis will be 2.5% above what it would otherwise have been.
The scale of the challenge
The scale of the absorption challenge facing the newer Member States is undoubtedly greater than that which we in Ireland had to overcome. Ireland joined the Union in 1973 at a time when our per capita income was around 60% of the EU average. Between 1973 and 1986, Structural Fund receipts averaged 0.9% of GDP per year. From 1987 to 1992 and again from 1993 to 1999, the annual average level of transfers doubled to 1.9%. Since then, these receipts have fallen sharply and now run at under ½% of GDP annually. Obviously, this will decline further in the next financing round.
A few simple points emerge from these data. First, the scale of the financial challenge facing the new Member States is double that which it was for Ireland, at its peak. Second, we in Ireland moved gradually up to that peak over a number of years. The step change in the level of funding inflows for the new Member States is much steeper than that which we had to surmount. Third, the inflows to Ireland were sustained for a very long period indeed. Between 1973 and 2003, Structural and Cohesion Funds receipts averaged 1.3% of GDP. This is a considerable period of time over which to learn from mistakes and to embed the funding flows into the mainstream of annual and medium-term budgetary planning.
Ireland was fortunate in other respects also. While some of those advantages are shared by a number of the newer Member States, others are not.
First, we are small. When it comes to planning and coordination, that helps a lot. Second, ours is a relatively centralised system and that helps too. In saying that, I am fully aware that the broad trend is towards decentralisation and devolution but there is no doubt in my mind that purely in terms of the effectiveness with which plans can be drawn up and integrated with mainstream macroeconomic management, a relatively centralised system has its advantages. And when you are dealing with flows of the order of 4% of GDP annually, their integration with national economic and budgetary planning is vital. Third, in planning to absorb and apply the Structural Funds, we were from the very outset building on a system and structure which was already there and which had to be developed rather than invented. Finally, the scale of the economic development gap which we were attempting to bridge was less than that currently facing some of the new partners.
These are just some of the factors which suggest to me that the challenges facing the new Member States are greater than those which we had to surmount. They are also some of the reasons why the Irish experience is not necessarily a model which will work for all. But for what it may be worth, I will describe what I think were the main elements in our relatively successful absorption record in the hope that some of the points will be of value to you. And it has been, I would argue, a good track record. During the 1989-93 programming period, Ireland was able to absorb something of the order of 95%+ of its Structural Funds allocation. For the 1993-99 Cohesion Fund round, we claimed in excess of 99% of our allocation. Under the current round, we had claimed in excess of 93% of our allocation by the end of 2003.
The keys to success – partnerships and planning
Successful absorption is not just about pulling in the money, it is also about using it well. If I had to sum up in just two words the key to Ireland’s story, those words would be partnerships and planning.
I said just a moment ago that a relatively centralised system has been one of the factors explaining our good record. Let me now explain and qualify that. The key decisions on the application in Ireland of available Structural Funding are made by central Government on the basis of recommendations made to Government by the Department of Finance. As this Department is also responsible for economic and budgetary planning, including taxation policy, this would appear to be a very highly centralised system of decision-making. However, it is necessary to qualify that view by looking at the process by which the decisions are reached and this is where partnership comes in.
Your first partner – the European Commission
The key partnership is of course that between the Member State and the European Commission. The many legal and political responsibilities of the Commission in this domain embrace regulatory issues, the efficient and proper execution of the EU budget and the consistent pursuit of an economic development agenda in individual Member States which is consistent with the overall goals which the Union sets for itself. This gives the Commission a central role from the highest political level down to desk officer level in influencing programme design, monitoring execution, evaluating the results and achieving financial closure at the end of the funding round. Furthermore, aside entirely from the legal rights and responsibilities of the Commission in this process, individual officers within the Commission are a rich and helpful resource and, in our experience, are of particular value to smaller Member States. So my first recommendation when it comes to successful absorption would be to establish and nurture a genuine working partnership at all levels with the Commission. There will be many occasions when views will diverge and when you may feel, sometimes rightly, that the Commission has got it wrong or is being unnecessarily inflexible but the core point here is that the Commission fundamentally shares your interests in terms of an efficient and effective application of the available funding. It is your first partner in this process. While the final sign off domestically on the National Plan is obviously made by the national Government, the Commission will have been a key partner at all stages in the development of the proposal put to Government.
Domestic partnership – the central Government sector
So also will the domestic actors in the process. The quality of the domestic partnership process is of prime importance in ensuring successful absorption. While the partnership with the Commission is a factor common to all Member States, the nature of the domestic partnership process will differ from country to country.
Domestic partnership starts within the central Government sector. In Ireland, the Department of Finance carries out many of the coordination functions at central level. We do not have a separate Ministry dedicated wholly to regional policy including Structural and Cohesion Fund matters. There may well be disadvantages to this, of course, but one of the advantages of Ireland’s set-up is that centralisation facilitates the integration of the Structural Funds with the domestic budgetary forecasting decision-making process. There is in my view a lot to be said for relatively centralised arrangements for drawdown, accounting, application and monitoring but of course systems of government differ and one size will not always fit all. However, in countries where the functions are dispersed across more than one Government Department, effective coordination along agreed policy lines is clearly vital especially at the planning stage.
Wider Social Partnership
The partnership between central Government and the regional actors can be seen as a special case of the wider process by which decisions are reached on the domestic economic development agenda. In Ireland’s case, that wider process is quite formalised. There has been in Ireland since 1987 a structured partnership encompassing Government and the representatives of the main economic and social interest groups. Originally conceived in the context of arriving at a national consensus on pay developments, the remit of this partnership soon expanded to include discussions across the broad spectrum of economic and social development priorities. Since 1987, six three year agreements have emerged from this process. This social partnership has made a significant contribution to our economic development. It has been used as a forum wherein opinions can be expressed on the development priorities which should be addressed in the National Development Plan and on results obtained. It has contributed to the building of a consensus on the contents of the Plan and has thereby facilitated the absorption of available Union funding.
PLANNING AND Implementation
Developing and perfecting the overall strategy is not sufficient in itself. Delivery structures play a major role in assuring a high level of absorption. I would see the important issues as these:
Early political agreement and broad consultation
I have already mentioned the quality of the partnership at domestic and EU level. In addition, I would emphasise the need for early political agreement for both the content and process of the planning procedure. This is particularly necessary to strengthen the ability of the key officials to deliver on the chosen strategy. Our experience is that political agreement should be concerned with the over arching issues and not with the detail of programme.
Ex-ante evaluation
A good ex-ante evaluation will help ensure that the operational elements of the programmes are consistent with the objectives. It will also improve the reliability cost and demand forecasts. Programme designers, therefore, need to fully consider the ex-ante conclusions. Despite our best attempts, it is not always possible accurately to cost schemes which will be implemented over a seven year timeframe. We have found that conditions will change with implications for the outturn on costs and demand. I am happy to see the initiative being pursued by the Commission and the EIB in this regard with their proposals for the JASPERS and JEREMY support programme for the new member states.
Delivery Structures and Administrative Capacities
Our experience suggests that it is better to build on or adapt existing delivery structures rather than to establish new ones. Inevitably, new structures take longer to develop the relationships and working modalities that are needed for effective implementation, particularly in the early years of a Plan. Existing structures, even if they have to be adapted, have operational resources and experience, and here I am speaking in organisational and human resource terms, which can be of immediate benefit to the roll out of programmes. Success lies in the effectiveness of administrators and managers. They need to have the technical skills needed to supervise programme execution. Officials should have active engagement with Commission officials.
Flexible Programming
The Commission will agree the financial plan at the CSF and operational programme level. There is little freedom on how the EU commitments are allocated across the years, as they must inevitably match with the Financial Perspectives. The programmes will take some time to get to full implementation status due to such reasons as the setting up of control arrangements, promoting schemes, and processing project applications. Therefore, in order to avoid losses under the N+2 Rule it is necessary to ensure that you have a mix of some high spending elements in the operational programmes. We have relied on some of these “winners” in the early years of implementation to ease the pressure on slower spending schemes and those that take more time to roll out.
Accessibility to Project Promotors
Too often good schemes fail because inadequate thought has gone into communication with the potential beneficiaries or the process for accessing funding is made too complex. You need to design schemes to be easily accessed by the target group for which they are intended. We have found it useful to provide resources to support the project promotor in preparing applications. This has the added advantage of ensuring an efficient project selection process by raising the quality of the applications.
Project Pipeline and Project Selection
I think Ireland has a number of useful experiences with respect to organising the project pipeline or stream. I like to describe this as parallel project development in that a number of projects are at different stages of development at the same time. In Ireland, strong central control ensured that only critically important and strategic projects were developed initially. However, given the certainty with respect to funding, we also pursued a policy of developing the next tier of projects in order to ensure no discontinuity in effort.
CONCLUSIONS
I’m aware that I have taken a broad interpretation of my brief here today. I have perhaps strayed outside the question of “Managing Structural Funds and Instruments” to consider some of the issues which arise at the macro level in tackling the question of how best to absorb available EU funding. In conclusion, let me say that
The absorption challenges facing the new Member States are greater that those which we in Ireland had to address;
The key to successful absorption is to focus on partnerships and planning;
The first partner is the European Commission whose desk officers are a rich and helpful resource, especially for smaller countries;
On the domestic scene, early political agreement is vital as are excellent relations across the main central Government agencies involved;
A relatively centralised system facilitates the integration of the Funds with decisions on the domestic public expenditure;
This has to be balanced by very broad genuine consultations with the key domestic actors;
On the planning side, good ex ante evaluation is the key;
Where possible, build on and adapt existing delivery mechanisms;
Focus on high spending elements early in the programming period;
Financial absorption is not an end in itself. What matters is physical investment and projects delivered. Project cost inflation can lead to a situation where the financial absorption record looks good but the actual content is less than planned;
Resource those seeking to access schemes, especially when it comes to smaller community-based and demand led schemes;
Do not wait until your plan is approved before you start thinking about your projects. It is essential to think of how projects will be developed at the earliest possible stage. Despite failure to agree the Financial Perspectives, all member states should be working on how to ensure a ready stream of projects for the new programming period;
Administrative capacity most be reinforced with ability, not numbers of personnel. The aim should be to use modern management methods and structures in support of the Funds. Members States can be innovative in their own right in this regard.
Thanks for your attention
12 October 2005
ADDRESSING THE ABSORPTION CAPACITY IN THE NEW MEMBER STATES
Mr Stephen O’Sullivan
Assistant Secretary
Banking Finance and International Division
Department of Finance, Ireland
______________________
Introduction
The enlargement of the Union to 25 members and the prospective further enlargements present unprecedented challenges for the Union as a whole and for its constituent Member States. One of these concerns the successful and productive absorption of the very considerable volume of resources to be transferred from the Member States with above average levels of development to those which are catching up.
There are many aspects to the challenge of absorption. I will say a few words about the overall level of financial commitment involved and talk about the challenges that we in Ireland had to overcome in utilising the funding placed at our disposal from the Union Budget over the years. I am fully aware of course that what may have worked reasonably well in one particular setting does not necessarily constitute a model which all will find appropriate for their particular circumstances. Nonetheless, I do hope that some of the lessons that we ourselves have drawn from our experience of planning, drawing down and implementing the Funds will resonate with you.
My main messages to you today will be
The absorption challenges facing the new Member States are greater that those which we in Ireland had to address;
We overcame our challenges by concentrating on partnerships and planning. The main focus of this paper is around these points; and
Our efforts paid off. Thanks to the structural funding transferred to us by our fellow EU Member States, Ireland’s level of GNP on a sustained basis will be 2.5% above what it would otherwise have been.
The scale of the challenge
The scale of the absorption challenge facing the newer Member States is undoubtedly greater than that which we in Ireland had to overcome. Ireland joined the Union in 1973 at a time when our per capita income was around 60% of the EU average. Between 1973 and 1986, Structural Fund receipts averaged 0.9% of GDP per year. From 1987 to 1992 and again from 1993 to 1999, the annual average level of transfers doubled to 1.9%. Since then, these receipts have fallen sharply and now run at under ½% of GDP annually. Obviously, this will decline further in the next financing round.
A few simple points emerge from these data. First, the scale of the financial challenge facing the new Member States is double that which it was for Ireland, at its peak. Second, we in Ireland moved gradually up to that peak over a number of years. The step change in the level of funding inflows for the new Member States is much steeper than that which we had to surmount. Third, the inflows to Ireland were sustained for a very long period indeed. Between 1973 and 2003, Structural and Cohesion Funds receipts averaged 1.3% of GDP. This is a considerable period of time over which to learn from mistakes and to embed the funding flows into the mainstream of annual and medium-term budgetary planning.
Ireland was fortunate in other respects also. While some of those advantages are shared by a number of the newer Member States, others are not.
First, we are small. When it comes to planning and coordination, that helps a lot. Second, ours is a relatively centralised system and that helps too. In saying that, I am fully aware that the broad trend is towards decentralisation and devolution but there is no doubt in my mind that purely in terms of the effectiveness with which plans can be drawn up and integrated with mainstream macroeconomic management, a relatively centralised system has its advantages. And when you are dealing with flows of the order of 4% of GDP annually, their integration with national economic and budgetary planning is vital. Third, in planning to absorb and apply the Structural Funds, we were from the very outset building on a system and structure which was already there and which had to be developed rather than invented. Finally, the scale of the economic development gap which we were attempting to bridge was less than that currently facing some of the new partners.
These are just some of the factors which suggest to me that the challenges facing the new Member States are greater than those which we had to surmount. They are also some of the reasons why the Irish experience is not necessarily a model which will work for all. But for what it may be worth, I will describe what I think were the main elements in our relatively successful absorption record in the hope that some of the points will be of value to you. And it has been, I would argue, a good track record. During the 1989-93 programming period, Ireland was able to absorb something of the order of 95%+ of its Structural Funds allocation. For the 1993-99 Cohesion Fund round, we claimed in excess of 99% of our allocation. Under the current round, we had claimed in excess of 93% of our allocation by the end of 2003.
The keys to success – partnerships and planning
Successful absorption is not just about pulling in the money, it is also about using it well. If I had to sum up in just two words the key to Ireland’s story, those words would be partnerships and planning.
I said just a moment ago that a relatively centralised system has been one of the factors explaining our good record. Let me now explain and qualify that. The key decisions on the application in Ireland of available Structural Funding are made by central Government on the basis of recommendations made to Government by the Department of Finance. As this Department is also responsible for economic and budgetary planning, including taxation policy, this would appear to be a very highly centralised system of decision-making. However, it is necessary to qualify that view by looking at the process by which the decisions are reached and this is where partnership comes in.
Your first partner – the European Commission
The key partnership is of course that between the Member State and the European Commission. The many legal and political responsibilities of the Commission in this domain embrace regulatory issues, the efficient and proper execution of the EU budget and the consistent pursuit of an economic development agenda in individual Member States which is consistent with the overall goals which the Union sets for itself. This gives the Commission a central role from the highest political level down to desk officer level in influencing programme design, monitoring execution, evaluating the results and achieving financial closure at the end of the funding round. Furthermore, aside entirely from the legal rights and responsibilities of the Commission in this process, individual officers within the Commission are a rich and helpful resource and, in our experience, are of particular value to smaller Member States. So my first recommendation when it comes to successful absorption would be to establish and nurture a genuine working partnership at all levels with the Commission. There will be many occasions when views will diverge and when you may feel, sometimes rightly, that the Commission has got it wrong or is being unnecessarily inflexible but the core point here is that the Commission fundamentally shares your interests in terms of an efficient and effective application of the available funding. It is your first partner in this process. While the final sign off domestically on the National Plan is obviously made by the national Government, the Commission will have been a key partner at all stages in the development of the proposal put to Government.
Domestic partnership – the central Government sector
So also will the domestic actors in the process. The quality of the domestic partnership process is of prime importance in ensuring successful absorption. While the partnership with the Commission is a factor common to all Member States, the nature of the domestic partnership process will differ from country to country.
Domestic partnership starts within the central Government sector. In Ireland, the Department of Finance carries out many of the coordination functions at central level. We do not have a separate Ministry dedicated wholly to regional policy including Structural and Cohesion Fund matters. There may well be disadvantages to this, of course, but one of the advantages of Ireland’s set-up is that centralisation facilitates the integration of the Structural Funds with the domestic budgetary forecasting decision-making process. There is in my view a lot to be said for relatively centralised arrangements for drawdown, accounting, application and monitoring but of course systems of government differ and one size will not always fit all. However, in countries where the functions are dispersed across more than one Government Department, effective coordination along agreed policy lines is clearly vital especially at the planning stage.
Wider Social Partnership
The partnership between central Government and the regional actors can be seen as a special case of the wider process by which decisions are reached on the domestic economic development agenda. In Ireland’s case, that wider process is quite formalised. There has been in Ireland since 1987 a structured partnership encompassing Government and the representatives of the main economic and social interest groups. Originally conceived in the context of arriving at a national consensus on pay developments, the remit of this partnership soon expanded to include discussions across the broad spectrum of economic and social development priorities. Since 1987, six three year agreements have emerged from this process. This social partnership has made a significant contribution to our economic development. It has been used as a forum wherein opinions can be expressed on the development priorities which should be addressed in the National Development Plan and on results obtained. It has contributed to the building of a consensus on the contents of the Plan and has thereby facilitated the absorption of available Union funding.
PLANNING AND Implementation
Developing and perfecting the overall strategy is not sufficient in itself. Delivery structures play a major role in assuring a high level of absorption. I would see the important issues as these:
Early political agreement and broad consultation
I have already mentioned the quality of the partnership at domestic and EU level. In addition, I would emphasise the need for early political agreement for both the content and process of the planning procedure. This is particularly necessary to strengthen the ability of the key officials to deliver on the chosen strategy. Our experience is that political agreement should be concerned with the over arching issues and not with the detail of programme.
Ex-ante evaluation
A good ex-ante evaluation will help ensure that the operational elements of the programmes are consistent with the objectives. It will also improve the reliability cost and demand forecasts. Programme designers, therefore, need to fully consider the ex-ante conclusions. Despite our best attempts, it is not always possible accurately to cost schemes which will be implemented over a seven year timeframe. We have found that conditions will change with implications for the outturn on costs and demand. I am happy to see the initiative being pursued by the Commission and the EIB in this regard with their proposals for the JASPERS and JEREMY support programme for the new member states.
Delivery Structures and Administrative Capacities
Our experience suggests that it is better to build on or adapt existing delivery structures rather than to establish new ones. Inevitably, new structures take longer to develop the relationships and working modalities that are needed for effective implementation, particularly in the early years of a Plan. Existing structures, even if they have to be adapted, have operational resources and experience, and here I am speaking in organisational and human resource terms, which can be of immediate benefit to the roll out of programmes. Success lies in the effectiveness of administrators and managers. They need to have the technical skills needed to supervise programme execution. Officials should have active engagement with Commission officials.
Flexible Programming
The Commission will agree the financial plan at the CSF and operational programme level. There is little freedom on how the EU commitments are allocated across the years, as they must inevitably match with the Financial Perspectives. The programmes will take some time to get to full implementation status due to such reasons as the setting up of control arrangements, promoting schemes, and processing project applications. Therefore, in order to avoid losses under the N+2 Rule it is necessary to ensure that you have a mix of some high spending elements in the operational programmes. We have relied on some of these “winners” in the early years of implementation to ease the pressure on slower spending schemes and those that take more time to roll out.
Accessibility to Project Promotors
Too often good schemes fail because inadequate thought has gone into communication with the potential beneficiaries or the process for accessing funding is made too complex. You need to design schemes to be easily accessed by the target group for which they are intended. We have found it useful to provide resources to support the project promotor in preparing applications. This has the added advantage of ensuring an efficient project selection process by raising the quality of the applications.
Project Pipeline and Project Selection
I think Ireland has a number of useful experiences with respect to organising the project pipeline or stream. I like to describe this as parallel project development in that a number of projects are at different stages of development at the same time. In Ireland, strong central control ensured that only critically important and strategic projects were developed initially. However, given the certainty with respect to funding, we also pursued a policy of developing the next tier of projects in order to ensure no discontinuity in effort.
CONCLUSIONS
I’m aware that I have taken a broad interpretation of my brief here today. I have perhaps strayed outside the question of “Managing Structural Funds and Instruments” to consider some of the issues which arise at the macro level in tackling the question of how best to absorb available EU funding. In conclusion, let me say that
The absorption challenges facing the new Member States are greater that those which we in Ireland had to address;
The key to successful absorption is to focus on partnerships and planning;
The first partner is the European Commission whose desk officers are a rich and helpful resource, especially for smaller countries;
On the domestic scene, early political agreement is vital as are excellent relations across the main central Government agencies involved;
A relatively centralised system facilitates the integration of the Funds with decisions on the domestic public expenditure;
This has to be balanced by very broad genuine consultations with the key domestic actors;
On the planning side, good ex ante evaluation is the key;
Where possible, build on and adapt existing delivery mechanisms;
Focus on high spending elements early in the programming period;
Financial absorption is not an end in itself. What matters is physical investment and projects delivered. Project cost inflation can lead to a situation where the financial absorption record looks good but the actual content is less than planned;
Resource those seeking to access schemes, especially when it comes to smaller community-based and demand led schemes;
Do not wait until your plan is approved before you start thinking about your projects. It is essential to think of how projects will be developed at the earliest possible stage. Despite failure to agree the Financial Perspectives, all member states should be working on how to ensure a ready stream of projects for the new programming period;
Administrative capacity most be reinforced with ability, not numbers of personnel. The aim should be to use modern management methods and structures in support of the Funds. Members States can be innovative in their own right in this regard.
Thanks for your attention
12 October 2005
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