STRUCTURAL FUNDS : NEW REGULATION TO SIMPLIFY PROJECT FINANCING.

Regions will be paying particularly close attention over the next six months to the legislative passage of a proposal to simplify European structural funds, presented by the Commission on 22 July. One of its most significant features is that it aims to give a financial boost to regions at a time when budgets are having a rough ride from the crisis, risking delays or oblivion for projects being cofinanced by structural funds. Initially, the Commission had planned to scrap for 2009 and 2010 the obligation for states to cofinance projects benefiting from European Social Fund (ESF) assistance. But the Council of Ministers threw out the idea and it is now buried once and for all. In the committee of permanent representatives (Coreper), member states preferred two other mechanisms: a new advance instalment in 2010 for the ESF and the cohesion funds for the benefit of those countries most affected by the crisis and easing of the rule on the automatic decommitment for 2007.

The goal is to allow programmes to be launched quickly. It is a sort of pre-financing budget usually calculated as a percentage of the structural fund allowance. For 2009 for example, it should have risen to 5 billion euro. But, because of the crisis, the institutions agreed to inject an extra 6.25 billion euro in advances. The Council is therefore suggesting repeating the operation in 2010 for social and cohesion fund programmes in countries particularly...