16 TRANS-EUROPEAN NETWORKS
(24556)
9099/03
COM(03)220
| Draft Regulation amending Council Regulation (EC) No 2236/95/EC laying
down general rules for granting Community financial aid in the field of Trans
European Networks.
|
| Legal base | Article 156 EC; co-decision; qualified majority voting
|
| Document originated | 29 April 2003
|
| Deposited in Parliament |
27 May 2003 |
| Department | Trade and Industry
|
| Basis of consideration |
EM of 28 May 2003 |
| Previous Committee Report |
None; but see (24246) 5847/03: HC 63-xiv (2002-03), paragraph 10 (5 March 2003)
|
| To be discussed in Council
| Not known |
| Committee's assessment | Politically important
|
| Committee's decision | Cleared, but request to be kept informed
|
Background
16.1 In March 2003 we cleared an amended draft Regulation
to amend the existing financial Regulation for Trans-European
Networks (TENs) to allow the Community to contribute up to 20%
of project costs — as opposed to the 10% currently allowed
— to support critical but difficult to finance cross-border
projects and projects to clear bottlenecks on the borders with
candidate countries.[35]
This earlier proposal is still under consideration.
16.2 TENs comprise three sectors: energy,
telecommunications and transport. Funding from the TENs budget
is intended to be catalytic, with the greater part of the funding
coming from either the public authorities of the Member States
or, especially in the fields of telecommunications and energy,
from the private sector. (The maximum level of support (from 1
January 2003) was increased under Regulation No. 1655/1999 from
10% to 20% of total investment costs for projects concerning satellite
positioning and navigation systems.[36]
For all other projects, the maximum remains 10% of total project
costs.)
The document
16.3 The Commission's present proposal relates
solely to the field of telecommunications (eTEN, formerly known
as TEN Telecom). It would apply only to projects for the deployment
of services and applications in that sector. It would increase
the funding ceiling for eTEN projects from 10% to 30%.
16.4 The Commission's case for the proposal
is that eTEN has been re-orientated to become a key element in
implementing eEurope 2005, in particular by focusing on services
of public interest, for instance in the health and municipal service
sectors. The eEurope Action Plan 2005, endorsed by the June 2002
European Council, is an essential element of the Lisbon strategy
to make the European Union the most competitive and dynamic knowledge-based
economy in the world by 2010. The Commission proposes that private
investments in telecommunications networks should be encouraged
by creating an investment-friendly legal framework on the supply
side and by taking actions that stimulate demand.
16.5 The Commission details the ways in
which eTEN contributes to the latter by concentrating on the deployment
of services that make use of an underlying infrastructure, especially
broadband and secure networks.
The Commission sets out what it sees as the
current shortcomings of the funding regime for eTEN, particularly
in the way it is concentrated on market validation or study projects
rather than projects to deploy services. It also notes a number
of detailed additional considerations it thinks should be taken
into account.
The Government's view
16.6 The Minister of State for Employment
Relations, Industry and the Regions, Department of Trade and Industry
(Alan Johnson) tells us:
"The Commission anticipates that its proposed
amendment would change the focus of future eTEN projects to spending
two thirds of their budget in the deployment phase, although there
would be no change to existing eTEN projects. However, it does
not forsee an overall increase in the budget envelope for any
of the TEN networks. In order to make available the higher level
of funding to eTEN the Commission acknowledges that there would
need to be fewer but higher impact projects in the future.
"The current Financial Perspective covers the
period 2000-2006. The Commission has stated in the report that
this action would not result in any additional costs beyond those
already foreseen for that Financial Perspective. However, under
Article 19 of the Regulation (Revision clause) the Commission
would be required to submit its proposals to continue or amend
the regulation before the end of 2006.
"The UK is concerned that the proposed amendment
may set a precedent for increases in the other TEN networks (where
there are proposals to increase the funding ceiling to 20%) or
lead to upward pressure on the overall TENs budget, and so is
therefore unable to support the Commission's proposal."
Conclusion
16.7 As noted in our Report of 5 March
2003,[37] we cleared
the earlier document on the basis of the Government's opposition
to a general increase to 20% in the level of TENs funding and,
if that increase was nevertheless adopted, to a consequent increase
in total funding.
16.8 We note now that the Government
also opposes an even greater increase specific to eTEN, particularly
as it would create a precedent for increases in the other TENs
sectors. On that basis we clear this document also. But as with
the earlier document we ask the Minister to keep us informed of
developments.
35 See headnote. Back
36
We cleared this proposal on 20 October 1999; see (20248) 8982/99:
HC 34-xxviii (1998-99), paragraph 34. Back
37
See headnote. Back
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