Why partnerships?

1. PARTNERSHIPS IN REGIONAL DEVELOPMENT LESSONS LEARNED FROM EU MEMBER STATES PRACTICESHachemi Bahloul, UNDP Bulgaria

2. Why partnerships? • One of the fundamental principles of the Structural Funds regulations (Bulgaria about to join the EU) • Necessity to absorb 4% of GDP requires a major national effort: all energies, capacities and resources need to be mobilized • Necessity to achieve development impact: 1) resources address priority problems; 2) ownership and thus commitment to success (absorption)

3. Why focus on regional development? • Striking regional unbalances: Bulgaria is only one foot in Europe • EU support focused on central government SF delivery structures: deliver what if there are no good projects? • What kind of regional development if the good projects essentially come from the big municipalities (“capacity vicious circle”)

4. Partnership bottlenecks in Bulgaria UNDP 2004 Assessment of Municipal and District capacities showed a problem with attitudes (partnership culture) and capacities (process) • Planning and programming partnerships • Project partnerships between state and non-state institutions • Partnerships between non-state institutions • Partnerships between municipalities • Partnerships in support of small municipalities to access SFs

5. Review of EU member states practices • UNDP supported review of practices of Ireland/Portugal (old m. states) and Poland and Czech Republic (new m. states) • Authoritarian past, similar size (except Poland), similar level of development at time of accession • Focus on the 5 Bulgarian problem areas • Objective: Identify bad practices (to avoid) and good practices (to replicate) • Many lessons – I will only present a few (Report will be available in early 2006)

6. Lessons learned: EU accession and governance Overall improvement of governance processes • Institutionalization of partnership in planning and programming (NDP and Operational Programmes) • Greater transparency and accountability in the management of resources (strict tender and control procedures) and monitoring of results (Monitoring Committees) • Decentralization: regional development operational programmes => new regional administration structures (management and legitimacy)

7. Lessons learned: planning and programming • Absorption of structural funds is the primary concern of the EC and the new member states • Old member states: 1) simple system of integrated planning/programming; 2) “top-down” planning counterbalanced by strong consultation (consensus); 3) focus on limited number of priorities and measures to simplify implementation and raise absorption • New member states: 1) complex planning/programming system; 2) local/regional participatory strategic planning disconnected from EU programming; 3) programming consultations are a formality/central government decides (de-facto centralization) => frustration

8. Lessons learned: planning and programming • Conditions for successful partnerships: • Provision of information on the part of the authorities • Clear understanding of SFs and the process (information, consultation or joint decision making => adequate expectations ) • Clear roles and responsibilities (partners have a say) • Trust between the partners • Time to establish effective partnership structures and conduct qualitative consultation processes

9. Lessons learned: project partnerships • Old member states: 1) well developed large national programmes co-funded by SF to which beneficiaries apply; 2) implementation by strong state agencies; 3) many programmes implemented by local state agencies but with a strong local partnership basis (Enterprise Boards – Ireland) • Exception to the rule: EU community initiatives (Leader, Urban, Equal) => genuine impact on community mobilization • Local partnerships can be sustainable and eventually gain political weight and influence • Conditions for success: 1) publicity; 2) clear funding lines; 3) guidance on how to apply; 4) capacity building

10. Lessons learned: project partnerships • New member states: 1) weak national programmes; 2) reliance on grant schemes; 3) excessive expectations as to the capacity of local and regional actors; 4) multiplicity of small projects (grants) which are difficult to manage and control => SF absorption problems • State agencies are not development actors but distributors of funds Good practice: Regional Development Agency Labe Arel Euro Region (Czech Republic) - Mixed non-profit structure (central state, municipalities, NGOs, private sector) – state subsidy + income from provision of services • Supports formulation of regional plans and 100-200 projects per year

11. Lessons learned: project partnerships Public private partnerships • Increasingly supported by the European Commission and SFs • Common in old member states, rare in new member states Problems: 1) Lack of capacity/experience; 2) Legal framework; 3) State aid rules Good practice: Associations of municipalities/private companies (Portugal) - Efficient solution to water supply, sewage and solid waste treatment - Most associations of municipality in 50/50 partnership with a private company (selected on a competitive basis) • Mixed company has access to the Cohesion Fund to build infrastructure • Operates systems of several municipalities at competitive prices

12. Lessons learned: NGO participation in SFs • Governments accept the partnership principle but do not necessarily systematically comply with it (often depends on sector/government department/individuals) – lack of trust • The extent to which the NGO sector influences decisions and receives SFs resources depends on its capacity to organize and lobby at the central level (decisions are taken centrally) • The EU Commission does not get involved Good practices: • Government structure to interact with the NGO sector (Council for Non-State Non-Profit Organisations – Czech Republic) • Successful lobbying for global grants (Czech Republic) • NGO liaison office - dialogue with the EC commission (Poland) • Regional NGO coordination (Poland) • NGOs train NGOs for SFs (Poland)

13. Lessons learned: NGO participation in SFs • Eligibility of NGOs for SFs funding requires that they are designated as beneficiaries of measures of the Operational Programmes – requires lobbying • NGOs generally eligible for few measures and can actually compete with other actors in a few areas (employment, social inclusion, tourism, environment) Issues: • Capacity to meet complex requirements (project formulation, accounting etc.) • 25% national co-financing of SFs • Bank guarantees

14. Lessons learned: Inter-municipal partnerships (IMP) Old member states: 1) IMP is a natural process (based on necessity and built over time); 2) IMP interests and projects are identified during the planning process New member states: 1) prevalence of competition; 2) IMP takes place sporadically for specific projects; 3) planning appears to be an abstract process detached from reality Good practice: Associations of municipalities (Portugal) • Strong associations at NUTS 3 level • IM planning process led by associations (consensus on projects) • Multi-year planning of municipal co-financing/SFs • IMP legally regulated – Management of SFs by associations through contracts with central government

15. Lessons learned: Inter-municipal partnerships • Achievement of consensus is essential – pragmatic (as opposed to abstract) planning has a key role to play • A facilitator in planning is needed (regional administration, association of municipalities, independent experts) • The central government must encourage IMP (publicize good practices, favour the selection of IMP projects) The Portugal experience is a demonstration of the fact that the planning/programming and management of the SFs can overtime become increasingly decentralized as local and regional capacities are built

16. Lessons learned: support to small municipalities “Capacity vicious circle” can increase regional unbalances ratherthan reduce them => small municipalities need special attention Community initiative such as Leader/Urban have a key role to play in supporting small municipalities in all countries Many countries have established national programmes in support of small municipalities, often operating along the principles of the EU community initiatives (RAPID - Ireland, Rural Centres Programme - Portugal)

17. Lessons learned: support to small municipalities Good practice: Technical Support Offices/TSO (Portugal) • Joint central-municipal government institutions (municipalities provide premises – central government funds staff, running costs shared) • 43 TSOs established, usually covering the territory of an association of municipalities (6.4 municipalities per TSO) • Provide project formulation technical support and played a key role in the absorption of SFs • The municipalities are now stronger and TSOs increasingly involved in controlling the spending of SFs by the municipalities

18. Conclusions • Partnerships is also about the sharing of power, resources and responsibilities – it takes time and requires the building of trust and a culture of partnership • Central government is entrusted by the EC with the responsibility to plan and manage the structural funds. The extent to which it is ready to share this responsibility also depends on the capacity of the other partners/development actors (municipalities/NGOs/businesses) • The SFs provide an opportunity to raise the capacity of these development actors and should not be missed. This in turn depends on their own “organisational maturity”, that is the capacity to establish a partnership among themselves to lobby for a fair share of the resources (initially for their own strengthening and then for the management of a larger share of the resources)

19. THANK YOU