Funding for regional and cohesion policy in 2007-13
Regional and cohesion policy funding makes up about a third of the EU budget. In the current funding period, €347 billion of the EU budget was allocated and, when national contributions are included, the total available funding is almost €700bn. For ICT and broadband, the main funds are:
- The regional development fund (ERDF). Out of the total of €271bn, Member States and Regions planned to spend 4.4% or €15.2bn on ICT projects and €2.3bn of this was for broadband projects.
- The rural development fund (EARDF). €1.02bn was added as part of the Recovery Package, to be used for broadband projects or other new challenges such as climate change or water diversity.
Use of the funds from 2007 to 2013
As we come towards the end of the current finance period, financial figures for September 2013 show that there have been difficulties in absorbing the available funds. Although execution rates have increased markedly over the past few months, nearly a quarter of ERDF funds allocated to ICT remain unspent, and nearly one third of broadband funds are unspent. For EARDF, €360m was programmed on broadband projects.
We have therefore set a priority to expand the use of funds. In 2011, we published a guidance on broadband investment for local and regional authorities to encourage the full absorption of EU funds. Stakeholders were invited to an EU-wide event on good practice in ICT implementation in regions and rural areas and made recommendations for further actions to meet the broadband target. These included:
- Allowing Structural Funds to be used within public private partnerships,
- Need to establish adequate institutional building and technical assistance arrangements. The Jaspers partnership is an important medium for such assistance,
- At national/regional level, there must be clear governance and attribution of competencies for decision making,
- Early and efficient process for state aid notification and approval,
- Adequate information regarding available sources of funding (eg grants and financial instruments)
Outlook for 2014-2020
For the programming period 2014-2020, the system of allocating structural funds has been redesigned to promote the efficient and effective use of public investment. The aim is to boost regional innovation in order to achieve economic growth, enabling regions to focus on their strengths. The key features are the thematic priorities and "ex-anti conditionalities" and the exact formulation of these is currently being negotiated by Commission, Council and Parliament.
ICT is one of 11 thematic objectives eligible for funding under the ERDF. Four of these (ICT, R&D, SME Competitiveness, and Low Carbon Economy ) will be priorities in which a substantial part of ERDF funds will be concentrated (50% of ERDF allocation in less developed regions and 80% in more developed regions – note however that negotiations on the structure are ongoing but these broad principles have been provisionally agreed by the three main Institutions).
The Commission has also requested that Member States fulfil two ex ante conditionalities before proposing Structural Funds programmes supporting ICT projects. These are to have a "Digital Growth" strategy and a Next Generation Access plan.
Regional authorities are to be asked to develop a smart specialisation strategy built on a sound analysis of regional assets and technology. To push forward the smart specialisation concept, we've set up the S3Platform. This will provide support to regional policy makers to absorb expertise to plan and implement ICT-based innovation and assist them with the criteria to fulfil the two ICT-related ex ante conditionalities:
- The development of a chapter relating to digital growth in the regional innovation strategy.
- The preparation of NGA network plans).
We are also developing a set of policy aids for regional broadband project development. These include the broadband tool-box and a revised broadband guide.