SIMPLIFICATION OF STRUCTURAL FUNDS MANAGEMENT

1. SIMPLIFICATION OF STRUCTURAL FUNDS MANAGEMENT Erich UNTERWURZACHER European Commission, DG Regional policy, Coordination unit Meeting with Stakeholders, 25 June 2010

2. The need of Simplification (1) :The financial and economic crisis Within the initial total financial resources of €347 billion for the 2007-2013 period and €250 billion of this envelope earmarked for Lisbon-related investments, cohesion policy provides a powerful support for both budgetary stability and public investment in MS and regions of the EU.

3. The need of Simplification (2) :Better regulation The regulatory environment influences competitiveness, growth and job creation. The Commission is committed to developing a better regulatory environment: one that is simple, understandable, less burdensome, effective and enforceable The reduction of administrative burdens is one of the targets of Better Regulation

4. EC response: all actors involved • Task Force within Commission’s Services • Experts from 26 Member States for the Group on Simplification • Dialogue with the beneficiaries • Regulatory Changes: EP/Council

5. December 2008: First Simplification round Simpler rules on revenues for small revenue-generating projects 1. The provision is more appropriate • ERDF and CF projects below EUR 1 million and all ESF projects excluded 2. Less burden in terms of monitoring • Can help speed up the implementation of innovative projects

6. April - June 2009: Second Simplification round The Recovery Package A: Simplification measures • Simpler reimbursement to major projects and state aid schemes • Accelerated implementation of major infrastructure investments; more flexibility for enterprise support, especially SMEs • Simpler method for the calculation of eligible expenditure • no need to justify each individual cost, less burden for archiving of supporting documents, less errors • Extension of eligibility for energy efficiency and renewable energy projects in housing to all MS B:Additional advances of EUR 6.25 billion

7. June 2010: Third Simplification roundRegulation N. 539/2010 (1) Facilitate Major projects 1. One threshold of EUR 50 million for all types of major projects • more decentralised management to the MS as 1/3 of major projects can be implemented without a need for the Commission decision 2. Simpler management of major projects with the Community or nation-wide importance • only one application form will be required

8. June 2010: Third Simplification roundRegulation N. 539/2010(2) Clearer and easier rules on the durability of the investment • Applicable only to infrastructure projects and productive investment projects • non-tangible projects excluded (e.g. business networks) • Only for ESF projects under state aid rules obligation to maintain the investment or jobs created • a majority of ESF projects (i.e. training) excluded • Cases of non-fraudulent bankruptcy excluded

9. June 2010: Third Simplification roundRegulation N. 539/2010 (3) Simpler revision of programmes • Evaluation exercise may be replaced by a simpler document justifying the revision of programme • New starting date of eligibility only in case of new category of expenditure • less and simpler adaption of programmes

10. June 2010: Third Simplification roundRegulation N. 539/2010 (4) Enhance use of financial engineering Stimulate spending in projects for energy efficiency and using renewable energy sources Possibility to set-up dedicated financial engineering instruments in support of such actions

11. June 2010: Third Simplification roundRegulation N. 539/2010 (5) Other proposed simplification measures • Shorter period for monitoring of revenues in case of revenue-generating projects • Simpler and clearer reporting on financial progress of the programmes in the annual reports • Clarification of admissible guarantees in case of advances to state aid schemes • More incentive to use partial closure of programme • More flexibility for the calculation of the amounts to be decommitted • reducing the administrative burden

12. First achievements of the Simplification • All these legislative initiatives were identified with the Member States authorities, who have a direct experience of the implementation of the policy on the ground • The positive impact on reducing the administrative burden is self-evident as the requirements will be either softened or disappear • First estimation from the Action programme for Reducing Administrative Burdens

13. Action Programme for reducing administrative burdens Target of the reduction: -25% by 2012 of Administrative burdens Costs specifically linked to information that would not be collected and provided in the absence of a legal obligation.

14. Reducing administrative burdens in 3 Steps • Mapping of Information Obligations (IO) CP = 6 IOs 2. Measuring Administrative Costs caused by IO CP= 0.7% of the total AB 3. Developing proposals for reducing AB CP= IT system for the exchange of data

15. High Level Group of Independent Stakeholders on Administrative Burdens Development of the Clearing House: Clearing Houses do not store data centrally, but keep track of what information is stored where. It should enable interactive portals and ensure that all information will be submitted only once by beneficiaries

16. First estimation of the Simplification -24% already potentially reached in cohesion policy at European level Full implementation mainly relies on Member States

17. Thank you for your attention!