Supplementary memorandum by Pat McFadden
MP, Minister of State for Employment Relations & Postal Services,
Department for Business, Enterprise & Regulatory Reform
At my Evidence session on the 26 February, I
agreed to provide further information on three issues.
The first issue was the levels of funding required
from Member States to "match" those provided by the
Funds. These are set out in the Regulation laying down general
provisions on the European Regional Development Fund, the European
Social Fund and the Cohesion Fund—Council Regulation (EC)
No 1083/2006. Article 53 and Annex III set out the contribution
from the Funds at the level of operational programmes. The maximum
levels vary from 50% through to 85% dependent on the Objective,
the Fund and the relative prosperity of the recipient Member State.
The relevant text from the Regulations is attached at Annex A.
The difference between these levels and 100% is the contribution
required from other sources. Thus, for example, if a Fund is providing
a maximum of 75% under the Regulations, the match funding to be
provided from other sources will be a minimum of 25%.
The second issue concerned the cost of administering
the Funds in the UK. The running costs of administering the Funds
in the UK for 2007-08, above those co-financed by the Funds through
Technical Assistance, is estimated to be £15.45 million[8].
This figure includes work on the 2007-13 programmes as well as
on the 2000-06 programmes which are still running.
In addition, there is some capital expenditure;
for example, £3.02 million is being allocated by Communities
and Local Government in 2007-08 to develop their IT system for
the 2007-13 period.
Article 46 of the Structural Funds General Regulation,
cited above, allows for a proportion of the Member States Allocation
to provide "Technical Assistance" for the running of
the Operational Programmes. This can be used to finance the preparation,
management, monitoring, evaluation, information and control activities
of Operational Programmes together with activities to reinforce
the administrative capacity for implementing the Funds. The maximum
limits for Technical Assistance are 4% of the total amount allocated
under the Convergence and Regional Competitiveness and Employment
Objectives and 6% of the total amount allocated under the European
Territorial Cooperation Objective.
Any funding provided by the Commission under
Technical Assistance needs to be match funded by the recipient.
For example, the domestic costs of the RDAs, as the body designated
by the Member State to administer the 2007-13 ERDF Operational
Programmes in the English regions, are match funded by Technical
Assistance.
The third issue was the current status of Objective
1 regions designated in 1989. Our analysis shows that of the 44
Regions designated across the EU as Objective 1 regions in 1989,
21 remain as Convergence Objective (the successor of Objective
1) regions for the 2007-13 period. Details of this analysis can
be found at Annex B.
12 March 2008
Annex A
RELEVANT TEXT OF COUNCIL REGULATION (EC)
NO 1083/2006 IN RELATION TO MATCH FUNDING LEVELS
ARTICLE 53
Contribution from the Funds
3. For operational programmes under the
European territorial cooperation objective in which at least one
participant belongs to a Member State whose average GDP per capita
for the period 2001 to 2003 was below 85% of the EU-25 average
during the same period, the contribution from the ERDF shall not
be higher than 85% of the eligible expenditure. For all other
operational programmes, the contribution from the ERDF shall not
be higher than 75% of the eligible expenditure co-financed by
the ERDF.
ANNEX III
Ceilings applicable to co-financing rates (referred
to in Article 53)
| Criteria | Member States
| ERDF and ESF Percentage of eligible expenditure
| Cohesion Fund Percentage of eligible expenditure
|
| (1) Member States whose average GDP per capita for the period 2001-03 was below 85% of the EU-25 average during the same period.
| Czech Republic, Estonia, Greece, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Portugal, Slovenia, Slovakia
| 85% for the Convergence and Regional competitiveness and employment objectives
| 85% |
| (2) Member States other than those under (1) eligible for the transitional regime of the Cohesion Fund on 1 January 2007.
| Spain | 80% for the Convergence and phasing-in regions under the Regional competitiveness and employment objective 50% for the Regional competitiveness and employment objective outside phasing-in regions
| 85% |
| (3) Member States other than those referred to under (1) and (2).
| Belgium, Denmark, Federal Republic of Germany, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Finland, Sweden and United Kingdom.
| 75% for the Convergence objective | —
|
| (4) Member States other than those referred to under (1) and (2).
| Belgium, Denmark, Federal Republic of Germany, France, Ireland, Italy, Luxembourg, the Netherlands, Austria, Finland, Sweden and United Kingdom.
| 50% for the Regional competitiveness and employment objective
| — |
| (5) Outermost regions referred to in Article 299(2) of the Treaty benefiting from the additional allocation for these regions provided for in paragraph 20 of Annex II
| Spain, France and Portugal | 50%
| — |
| (6) Outermost regions referred to in Article 299(2) of the Treaty
| Spain, France and Portugal | 85 % under the Convergence and Regional competitiveness and employment objectives
| — |
| | |
|
Annex B
ANALYSIS ON THE CURRENT STATUS OF OBJECTIVE 1 REGIONS
DESIGNATED IN 1989
PROGRESS OF
THE REGIONS
ELIGIBLE FOR
OBJECTIVE 1 (OBJ
1) IN 1989
| | |
| |
| Programming periods | 1989-93
| 1994-99 | 2000-06
| 2007-13 |
| | |
| |
| No. of Obj 1/convergence objective regions |
44 | 44 | 38 |
21 |
| No. of regions receiving funding from Obj1/convergence objective
| 44 | 44 | 43
| 30 |
| | |
| |
| | |
| |
Explanatory Notes
In 1988, 44 regions were designated to receive EU Objective
1 funding for the period 1989-93. All of those regions were still
eligible for Objective 1 in the following funding period 1994-99,
with the exception of Abruzzi in Italy, which only received support
until 1996.
For the 2000-06 period, five regions had GDP above 75% of
the EU average. They received transitional funding from Objective
1 for the period. So, although 43 regions were receiving Objective
1 funds, only 38 of them were still Objective 1 regions.
As part of the reforms of the Structural Funds for 2007-13,
Objective 1 was replaced by the convergence objective, with the
same qualifying criterion. The regions eligible for the convergence
objective were designated in 2005 on the following basis: regions
with a GDP below 75% of the EU-25 average were designated as convergence
objective regions. Regions with a GDP above 75% of the EU-25 average
but below 75% of the old EU-15 average were given convergence
objective funding on a transitional basis (and designated as Phasing-Out
regions). Regions which had received Objective 1 in 2000-06 but
now had a GDP above 75% of both the EU-25 and EU-15 average were
given transitional support from the competitiveness and employment
objective (and designated as Phasing-In regions).
Of the original 44 regions eligible for Objective 1, 21 were
eligible for its successor, the convergence objective. An additional
nine regions were designated as Phasing-Out regions.
Additional Points
— These tables only cover the progress of the original
44 regions designated as Objective 1 in 1988. They do not cover
any regions that became eligible after 1988.
— In 1988 the EU consisted of 12 Member States (including
pre-unification West Germany).
— Ireland was a single NUTS-2 region between 1989-99.
To enable consistent comparison, it has been counted as two regions
throughout the tables.
— The Spanish NUTS-2 region Ceuta-Melilla was split
into two for 2007-13. To enable consistent comparison it has been
counted as two regions throughout the tables.
DETAILS
| | Status
| | | |
| MS | Region |
1989-93 | 1994-99 |
2000-06 | 2007-13 |
| Spain | Andalusia | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Asturias | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Castilla y Leon | Obj 1
| Obj 1 | Obj 1 | Phasing-In
|
| Castilla-La Mancha | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Ceuta | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Melilla | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Comunidad Valenciana | Obj 1
| Obj 1 | Obj 1 | Phasing-In
|
| Exrtemadura | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Galicia | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Canary Islands | Obj 1
| Obj 1 | Obj 1 | Phasing-In
|
| Murcia | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| France | French Overseas Depts
| Obj 1 | Obj 1 | Obj 1
| Convergence |
| Corsica | Obj 1
| Obj 1 | Transition |
|
| Greece | Anatoliki Makedonia, Thraki
| Obj 1 | Obj 1 | Obj 1
| Convergence |
| Kentriki Makedonia | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Dytiki Makedonia | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Thessalia | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Ipeiros | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Ionia Nisia | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Dytiki Ellada | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Sterea Ellada | Obj 1
| Obj 1 | Obj 1 | Phasing-ln
|
| Peloponnisos | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Attiki | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Voreio Aigaio | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Notio Aigaio | Obj 1
| Obj 1 | Obj 1 | Phasing-In
|
| Kriti | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Ireland | Border Midlands & Western
| Obj 1 | Obj 1 | Obj 1
| Phasing-In |
| Southern and Eastern | Obj 1
| Obj 1 | Transition |
|
| Italy | Abruzzi | Obj 1
| Obj 1/Transition* | |
|
| Basilicata | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Calabria | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Campania | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Molise | Obj 1
| Obj 1 | Transition |
|
| Apulia (Puglia) | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Sardinia | Obj 1
| Obj 1 | Obj 1 | Phasing-In
|
| Sicily | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Portugal | Notre | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Centro | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Alentejo | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Algarve | Obj 1
| Obj 1 | Obj 1 | Phasing-Out
|
| Acores | Obj 1
| Obj 1 | Obj 1 | Convergence
|
| Madeira | Obj 1
| Obj 1 | Obj 1 | Phasing-In
|
| Lisboa | Obj 1
| Obj 1 | Transition |
|
| UK | Northern Ireland | Obj 1
| Obj 1 | Transition |
|
| Notes | | |
| | |
| *= Abruzzi was Objective 1 for 1994-1996 only
| | | |
| |
8
This covers the budgets of Business, Enterprise and Regulatory
Reform, the Department of Work and Pensions, Communities and Local
Government, the Welsh Assembly Government, Scottish Executive
and Northern Ireland Executive Back
|
