Studies on the integration of new regulatory elements in the programming process
The purpose of these studies is to take stock of how the new regulatory elements of the reformed policy have been integrated into the programming process. In addition, the last study provides information on the scope of project sizes in the 2007-2013 period.
They provide evidence and an analytical basis for the debate on the design of the policy post 2020 and related impact assessments.
The use of new provisions during the programming phase of the European Structural and Investment Funds
The analysis of all the 28 Partnership Agreements and of 292 operational and co-operation programmes for the 2014-2020 period financed by the European Regional Development Fund, the Cohesion Fund and the European Social Fund, completed with a survey of managing authorities and interviews at European, national and regional levels, revealed that the new regulatory framework has significantly altered the Member States’ approach to programming. The new provisions required programmers to link strategic thinking and result-based management, and relate strategic thinking with the objectives and the means of the Europe 2020 strategy.
The new programming approach succeeded to make the strategy behind the allocation of resources, the links between means and results more specific and transparent than before. However, the presentation of programmes became rather complicated. The wide range of needs addressed suggests an apparent demand for integrated territorial approach. At the same time, the scope for applying the integrated instruments in all sectors and types of areas has not yet been exhausted.
Implementation-related new provisions were among the less controversial elements of the nineteen new provisions analyzed, and in general, Member States did comply with new requirements in this area. This provides a good basis for further developing implementation capacity.
The implementation of the performance frameworks in 2014-2020 ESI Funds
The performance framework (PF) and performance reserve have been included as compulsory elements in programmes in the 2014-2020 programming period of the European Structural and Investment (ESI) Funds in order to ensure that programmes are kept on track to achieve their objectives and that progress can be adequately measured. This report provides a synthesis covering the manner in which the provisions relating to the PF and the performance reserve are reflected in all Partnership Agreements (PA), operational programmes (OP) under the Investment for Growth and Jobs Goal (IGJ) financed by the European Regional Development Fund (ERDF) and the Cohesion Fund (CF), including multi-fund programmes co-financed by the European Social Fund (ESF), and the European Territorial Cooperation (ETC) programmes financed by the ERDF. The study is based on 60 interviews, desk research and additional information provided, a focus group with representatives from the European Commission and a web-survey. This final report analyses and assesses the processes for the establishment of the PF, how PFs have been designed (i.e. the indicators used for milestones and targets), the establishment of the performance reserve, and the strengths and weaknesses of the PF and performance reserve. The findings show that the PF is overall helpful in focussing programmes and contributing to a results-oriented approach. However, while there are clear benefits from the PF, there are also a number of caveats and challenges emerging from the analysis.
The implementation of the provisions in relation to the ex ante conditionalities during the programming phase of the European Structural and Investment (ESI) Funds
The study reviews the implementation of the ex-ante conditionalities that were introduced in the Regulations of the 2014-2020 European Structural and Investment Funds and were assessed through the Partnership Agreements and Operational Programmes developed to deliver those funds. The research findings highlight the value of ex-ante conditionalities, in encouraging the fulfilment of EU regulatory requirements faster than might have been the case in their absence and reinforcing effectiveness through associated strategies in the policy areas supported by ESI Funds. The process has also allowed the Commission to engage in a dialogue with Member States, resulting in an improved understanding of the situation in the Member States. However, in some of the ‘older’ EU-15 Member States, the added value was perceived to be limited and the process of assuring the conditionalities attracted some criticism for being disproportionate to the benefits. Timing, costs and the extent of actions required to fulfil some of the conditionalities have generally exceeded the original estimates or required more resources than was envisaged, by both the Commission and Member States.
Implementation of the partnership principle and multi-level governance during the 2014-2020 ESI Funds
In the legislative framework for the 2014-2020 ESI Funds the partnership principle has been strengthened. Article 5 of the Common Provision Regulation (CPR) makes it compulsory for each ESI Fund programme to organise a partnership at all programming stages and at all levels. A European Code of Conduct on Partnership (CoC) has been set up to support Member States to ensure that all partners are involved at all stages in the implementation of Partnership Agreements and programmes. Even though the partnership principle is not new for the 2014-2020 ESI Funds, more importance has been given to stakeholder involvement and influence. The aim of this study is to review the establishment of the partnership principle and the application of the CoC in the Partnership Agreements and programmes financed by the European Regional Development Fund (ERDF) and the Cohesion Fund (CF), including European Territorial Cooperation (ETC) programmes and multi-fund programmes co-financed by the European Social Fund (ESF). The study analyses data collected by document analysis, web-survey and interviews.
The partnership principle has been satisfactorily respected in a wide range of countries and programmes. However, there are still challenges across a broad range of countries concerning the mobilisation of partners. Generally the modified legal framework was perceived as positive as it increased awareness and visibility of the partnership principle. The level of stakeholder involvement has improved since the 2007-2013 programming period, although there are sometimes differences between the content of the programming documents and the perception of stakeholders. Overall, the partnership principle adds value to the implementation of European public policies.
Setting up a database to assess impacts and effects of certain thresholds and limits in Regulation (EU) No 1303/2013 (CPR)
In order to reduce the administrative burden, respect the principle of proportionality, ensure sound financial management, and facilitate the implementation of the European Structural and Investment (ESI) Funds both for the Member States and the beneficiaries, the Common Provisions Regulation establishes a set of thresholds and limits on administrative requirements for operations benefitting from ESI Funds.
Modelling the impact of these new thresholds at the level of the operations with existing data was problematic as data was only available at an aggregate level. Therefore, the European Commission initiated this study to establish a database and subsequently analyse operation-level data from Operational Programmes supported by the ERDF and CF under the 2007-2013 programming period. Where possible, data that could not be collected was estimated.
The assembled database was then used to analyse the distribution of operations, both in terms of the number of operations and their total cost, around six thresholds. This analysis was also applied to show the impact based on other criteria, including category of region, priority theme, territorial dimension, and for individual Member States. Finally, sensitivity analyses were conducted to analyse the impact that any potential changes in the thresholds would have on these parameters.
Use of new provisions on simplification during the early implementation phase of ESIF
In preparation of the regulatory framework for the 2014-2020 programme period, simplification measures were introduced to reduce administrative costs and burden. Expectations concerning possible reductions have been based among others on an impact study carried out by t33/SWECO in 2012. The present study reviews whether 21 selected simplification measures generated the expected reductions. While previous studies addressed only single funds, this study, for the first time collected comparable figures on administrative costs and burden for all five ESI Funds. Given the uncertainty related to assessing changes in administrative costs and burden until the end of the 2014-2020 programme period, the figures presented in this study are merely proxies and need to be treated carefully.
Overall, the efforts to reduce administrative costs and burden are paying off. These simplification measures are expected to reduce administrative costs for ESI Funds by EUR 0.5 to 1.5 billion, i.e. 2 to 5% of administrative costs. Taking the 2007-13 period as a baseline, the implementation of simplification measures is expected to reduce the administrative costs to EUR 23 to 24 billion, i.e. 4% of the ESIF budget.
In addition, simplification measures are expected to reduce the administrative burden for all ESI Funds by EUR 1 to 2 billion, or 9 to 15%. Taking the 2007-13 period as a baseline, simplification is expected to reduce the burden to EUR 11 to 12 billion, i.e. 2% of the ESIF budget. However, most of the reduction is from only 10 of the 21 simplification measures. The remaining 11 measures deliver a mixed picture.
There is further room for reducing administrative costs and burden, in particular through increasing the uptake of SCOs and reducing gold plating.
Improving the take-up and effectiveness of financial instruments
In the wake of the financial crisis, public and private investment has stagnated due to loss of confidence and austerity policies. The supply side for investment is complex, with the boundaries between public and private often blurred. The overall landscape varies widely between countries, but is characterised by the growing importance of national promotional banks (NPBs) in economic development. Carefully calibrated financial instruments, often provided through NPBs, can provide sustainable support for revenue-generating / saving projects in areas like SME support, R&D&I and energy efficiency where market imperfections result in suboptimal levels of investment. The uptake of ESI Fund co-financed FIs has increased in 2014-20, but remains focused on loan-based SME support. The regulatory framework for ESIF co-financed FIs has improved, especially through mandatory ex ante assessments, but the implementation of FIs remains challenging for Managing Authorities, suggesting that more timely guidance, more stable rules, and perhaps more ‘off-the-shelf’ instruments would be beneficial. However, the plethora of initiatives at domestic and European levels can make the FI ‘scene’ difficult to decipher and quantify. Related, there is evidence of policy competition, pointing to the need to rationalise modes of intervention and tailor FIs to the relevant institutional and economic context.