Select Committee on European Communities Minutes of Evidence

Examination of witnesses (Questions 120 - 139)



  120.  Are you doing anything with the larger contracts to try to reduce the professional consultancy firms and encourage the smaller organisations to come in? Is there any way that can be done?

  A.  To my knowledge, there is no more systematic way of providing this kind of assistance. In my opinion, for environment projects, many of the larger consultancy firms are in consortia with some of the NGOs, as a way of strengthening their bids. They could also have national authorities of one kind or another as part of a consortium.


  121.  We have heard a rumour that you are thinking of doing away with the middle range of funding. Is this true? The idea is that there should only be very large projects over ten million ECU and the very small ones and that there should not be the middle band. Have you heard this rumour yourself? It is worrying some of the NGOs who see themselves as fitting somewhere in the middle. Have you heard anything?

  A.  No, I have not heard of any such thing. To have contracts only over ten million ECU, in my personal opinion, would not be manageable. These are technical assistance projects, so we are not dealing with investments. A technical assistance project of four million ECU is quite a lot already. The absorption capacity of the country in question is not such that they can absorb more.

  122.  As far as you know, there is no plan to change the system of the way the projects are organised?

  A.  No.

Earl of Lindsay

  123.  Can I ask whether NGOs are only involved of their own volition or because, at the bidding end, they have decided that an NGO might make a good partner in the bid or whether, from your end, there is a deliberate priority or effort made to have NGOs involved in order that you can capacity build amongst those NGOs and therefore perhaps build up some sort of a continuing legacy that they can then deliver after the TACIS project is finished?

  A.  To the extent of my knowledge, the only more systematic way that TACIS is doing this is through the Lien Programme.


  124.  You are also doing things under the democracy programme, are you not, encouraging NGOs?

  A.  Yes. The Democracy Programme is approximately the same. Sometimes, when writing terms of reference, we can urge or request that they cooperate very closely with NGOs.

  125.  When you get the RECs established, they will provide support for NGOs as well?

  A.  Yes. The EU is definitely the largest contributor to these new Regional Environmental Centres. I think it is a very interesting process that we at least from TACIS hope we will be able to steer or put our emphasis on working in the environmental NGOs.

Earl of Lindsay

  126.  You mentioned the Partnership and Cooperation Agreements when you were answering Lord Walpole's question. A brief description of them would be useful. I would also be grateful if you could tell us how you see the new emphasis on partnerships working in practice. Given that the Partnership and Cooperation Agreements are a fairly new mechanism, we would be interested to know how they differ from the indicative programmes.

  A.  I am really not the person to elaborate very much on the PCAs. The environmental priorities set in the PCAs, for example in Russia, and the cooperation areas are very broad. In my opinion, they have to be made operational to be able to be used as a guideline for programming and also as a guideline for influencing the drafting of the indicative programmes.

  127.  What is the best source of information on those questions?

  A.  There is a lot of information in DG1A on this. If you wish, we could provide you with that.

Chairman:  We will be visiting you next month, so perhaps we will have an opportunity then to find out more about things.

Earl of Lindsay

  128.  Can I ask you what plans DG1A has for expanding the number of collaborative programmes, especially those which involve more than one Member State? You have already mentioned a number of Cross-Border Cooperation Programmes but you might like to elaborate.

  A.  I was not quite certain as to what you mean by "collaborative programmes". This means when TACIS is cooperating with the EU bilateral donors?


  129.  I think it was more to do with when there were environmental problems like the Black Triangle which we looked at, which was on the borders of East Germany, Poland and Czechoslovakia. Are you developing links between the old Russian countries and getting the Ukraine and Russia to work across their borders, for instance, in any way?

  A.  Maybe I will call them the multicountry programmes. For example, TACIS is supporting the Black Sea Environmental Programme as well as PHARE because they have Romania and Bulgaria. We have three other countries in the Black Sea. We are assisting the countries in implementing what is called a strategic action plan for improving the environmental conditions in the Black Sea. We are assisting the development of the network between these countries, to have them cooperating on issues to improve the Black Sea. We have likewise a programme just starting up for the Caspian Sea.

  130.  And the Aral Sea, or is that beyond repair?

  A.  We also have a programme for the Aral Sea. I am not dealing with this very much myself. As I understood, the donors involved in the Aral Sea region are now concentrating on secondary effects for the Aral Sea because it is quite recognised that there is not much to do with the Aral Sea today. It is beyond that point.

Earl of Lindsay

  131.  To what extent do those bidding for contracts represent cross-border bidders—i.e., agents in separate countries who come together to launch a joint bid to TACIS? Do they tend to derive from single Member States only?

  A.  In the major part of the large size contracts, it is almost always consortia and almost always they are comprised of consultancy companies from two, three or four Member States. It is quite seldom at least to the extent of my knowledge that you have a large contract awarded to a single firm and not an incorporation of some sort or another because the nature of many projects is such that it requires competence in so many different sectors that there are few firms that could actually cover all of this so either they are in consortia and if they are not in consortia then they subcontract.

Chairman:  Thank very much. Lord Ponsonby, I think you have the final group of questions.

Lord Ponsonby of Shulbrede

  132.  Could you tell us about the procedures for monitoring and evaluating the projects please.

  A.  Each project is assigned a monitor in the recipient country and it is actually a task monitoring team comprised of local expertise and ex-patriot expertise and they monitor the projects on a regular basis and they can also do it at the request of the task manager. For example, if I have a project somewhere and I feel that maybe there is something going on which is not exactly what we want or maybe I am planning a follow up and I need some more information on the sustainability of the project, I can request specifically a more in-depth monitoring of that specific project. As I see it, the monitoring report is a very important tool for the task manager because the task manager is not able to visit all the projects that he or she is responsible for and especially not if they are working on projects that comprise many different countries. Then the monitoring reports address issues that the task manager needs to take up, that the contractor needs to address, for example, if their reporting is not according to the task guidelines. It also addresses issues that the counterpart should address in improving the project in one way or another. But the monitoring works so that the contractors are monitored against the terms of reference in their contract and not on overall issues.

Lord Ponsonby of Shulbrede:  I see. The next question is perhaps more difficult to answer. That is how can the Commission lead to try and encourage capital investment after the project is finished and what relationships do you have with EBRD and the World Bank and the like to try and ensure that happens? Do you monitor how successfully projects have attracted some form of capital investment?


  133.  It is one of the great difficulties, is it not, for the ex-Communist countries how to deal with investment?

  A.  The investment question is a difficult issue. We tried to do it for example on the city twinning programme. Many of them have been dealing with waste water treatment for example. Maybe some of the outcomes of these projects are forwarded to some of the international financial institutions to see if there is a possibility of investment follow up. There is also what we call the EBRD Bangkok facility. It is kind of like a trust fund at EBRD for EBRD to undertake feasibility studies for investment projects with funding from TACIS. In the studies to be undertaken there should be a great likelihood of follow-up investment lending so we do not go into a number of feasibility studies where nothing is happening in the end.

  134.  You are always hoping there will be a follow on?

  A.  Yes and it is quite clear that it will not always be the case because it is not until you have done the feasibility study that you can actually see if the project is worthwhile in continuing or not but at least it should be certain to quite a large degree. I think that for some years, maybe not so much for TACIS, there were quite a lot of feasibility studies done for different projects and not a lot happened in them, but that was not from TACIS. As regards the environment we actually do work quite a lot with the World Bank and EBRD in furthering the possibilities of investment follow up.

Lord Mackie of Benshee

  135.  May I come in on this. It appeared to me from evidence that we have had before that the EBRD used TACIS money to investigate the process. In other words, you do a lot of their work for them in the viability of the programme and the necessity. Could you give us an idea on how often they actually follow it up. Can you give us an example as to when they did actually give the money or lend the money on commercial terms or whatever it is?

  A.  No I am sorry, I cannot answer that question because I do not know the statistics for that.


  136.  Finally, what do you see as the future of TACIS? Do you think it is going to grow? Will it be so successful and wither away and will countries manage by themselves? How do you see things developing?

  A.  You all know that there will be a new regulation for 1999. The current regulation will expire at the end of 1999. Then there will be a proposal to the Council from the Commission concerning the future of TACIS in September or October of this year.

  137.  But you do not know what will be in it yet?

  A.  No we do not.

Lord Hughes of Riverside:  What would you think should be in it? If this Committee has got to make some recommendations——

Chairman:  We can help you, we are not antagonistic. We are in the business of trying to help TACIS succeed.

Lord Hughes of Riverside

  138.  What lines would you be thinking of in improving it?

  A.  I cannot really comment on it because it will be part of the proposal which is all now being prepared.

Earl of Lindsay

  139.  To what extent will DGXI be involved in working up the new proposal?

  A.  Not only for the new regulation we have quite close co-ordination between DGIA and DGXI on TACIS on a daily basis which, in my opinion, is very helpful because they have some expertise in DGXI which we do not have in DGIA which we make use of. For example, in the preparation of this proposal to the Council we have also what we call the inter-service consultation process which is a formalised process of consultation between the different directorates and obviously involving not only DGXI but all of the DGs. Obviously I work mostly with DGXI but for example on energy projects, which also have a large environmental component, we work very closely with DGXVII, the Energy Directorate.

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