28 Annual report on the Structural Funds
in 2003
| (26119)
14258/04
COM(04) 721
| 15th annual report on the implementation of the Structural Funds (2003)
|
| Legal base | — |
| Document originated | 28 October 2004
|
| Deposited in Parliament | 10 November 2004
|
| Department | Trade and Industry
|
| Basis of consideration | EM of 26 November 2004
|
| Previous Committee Report | None; but see (25020) 14415/03): HC 42-ii (2003-04), para 10 (9 December 2003)
|
| To be discussed in Council | No date set
|
| Committee's assessment | Politically important
|
| Committee's decision | Cleared
|
Background
28.1 Article 45(2) of the Regulation laying down general provisions
for the Structural Funds requires the Commission to make an annual
report on the implementation of the Funds.[82]
28.2 The Structural Funds currently comprise:
- the European Regional Development
Fund (ERDF), which aims to redress regional disparities within
the EU by providing assistance to regions which are lagging behind
or are suffering from industrial decline. It provides support,
for example, for transport, environmental, telecommunications,
energy and tourism projects;
- the European Social Fund (ESF), which aims to
improve employment opportunities for the long-term unemployed,
young jobseekers and people excluded from the labour market and
to promote equal opportunities and adaptation to changes in industry;
- the guidance section of the European Agricultural
Guidance and Guarantee Fund, which provides assistance for, for
example, young farmers, hill farms, rural infrastructure and woodland
protection; and
- the Financial Instrument for Fisheries Guidance,
which provides assistance to, for example, modernisation of vessels,
development of fish farming, development of port facilities and
promotion of the processing and marketing of fish products.
28.3 For the period 2000-06, the distribution of
the Structural Funds is primarily related to three aims:
- Objective 1 — to promote
the development of regions whose per capita GDP is less than 75%
of the Community average and of remote regions (such as the Azores
and northern Finland);
- Objective 2 — to assist regions seriously
affected by industrial decline; and
- Objective 3 —to support the modernisation
of policies and systems concerned with employment, education and
training outside Objective 1 regions.
28.4 The budget of the Structural Funds for 2000-06
is €257 billion.
The document
28.5 The document fulfils the Commission's obligation
to provide a report on the implementation of the Structural Funds
in 2003. It has a technical annex containing detailed supporting
information.
28.6 Commitment appropriations in 2003 amounted to
96% (over €31billion) of the available funds, the highest
level ever for the Structural Funds. Actual payments in 2003 were
89% (€26.2 billion) of the budget, up 18% on 2002.
28.7 The annex provides details of commitments and
payments broken down by Fund, sector, objective and recipient
Member State. In 2003, Spain received a quarter of all payments
from the Funds. Three quarters of the total payments went to five
countries (Spain, Germany, Italy, Portugal and Greece). Two sectors
were each allocated more than 10% of the available funding: transport
infrastructure (15%) and assistance for small and medium-sized
enterprises (11%).
28.8 During 2003, measures were introduced to simplify
the management of the Structural Funds. These concerned, for example,
the arrangements for inspections, for performance measurement
and for the amendment of programmes.
28.9 The report provides factual information on the
interaction, in 2003, between the Structural Funds and the Lisbon
Strategy, other Community policies, the Cohesion Fund, and the
European Investment Bank and Fund. It also provides short summaries
of five evaluations of programme expenditure between 1994 and
1999. The report comments that the United Kingdom had not provided
by 31 December 2003 the information required for another study
of "additionality" — that is, that Community funds
were used in addition to, not as a replacement for, expenditure
by Member States. (The Government says that the Commission has
received a document satisfactorily demonstrating additionality
by the United Kingdom for the programmes concerned.)
28.10 The Commission reports that the European Anti-Fraud
Office (OLAF) carried out 13 inspections in Member States, as
well as joint audits with Directorates-General. During 2003, Member
States reported 2,439 cases of irregularity or fraud, involving
a total of over €340 million. This was about half the number
of cases and half the amount of money reported in 2002. (The minimum
amount which triggers a report has remained at €4,000 since
1994.)
The Government's view
28.11 The Minister of State for Trade and Industry
and Foreign Affairs at the Department of Trade and Industry (Mr
Douglas Alexander) tells us that the Commission's report has no
financial or legal implications for the United Kingdom and that
there is no timetable for its consideration by the Council.
Conclusion
28.12 We draw the document to the attention of
the House because of the scale of the expenditure in 2003 from
the Structural Funds. It is encouraging that budgetary discipline,
as reflected in the figures for appropriation commitments and
payments, has improved. There are no questions we need put to
the Minister about the report and we are content to clear the
document from scrutiny.
82 Regulation (EC) No. 1260/1999, OJ No. 161, 26.6.1999.
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