Hostility over out-sourcing plan for aid programmes

Date: 16/01/1997

By Rory Watson

OVERWHELMED by the sheer volume of funds and projects it manages around the world, the European Commission is examining fundamental changes to the way it administers the EU's multi-billion-ecu development cooperation programmes.

Commission President Jacques Santer and a group of colleagues at the centre of the institution's external policy-making will consider far-reaching plans later this month to transfer all the adminstrative and technical aspects of the Union's world-wide aid programmes to an outside body.

A radical solution being advanced by Development Aid Commissioner Joo de Deus Pinheiro would establish an outside agency, answerable to the Commission, European Parliament and member states. But the idea has already provoked hostility from departments handling aid policies for Asia, the Mediterranean and Latin America, who fear it would weaken their own authority.

What is eventually decided will affect not only the Union's many external programmes now run by five separate departments but will also send a clear signal about the type of civil service the Commission wishes to run in the future.

By handing over the management of technical day-to-day development aid issues to outside experts, many existing Commission officials would be released from mundane tasks and be available to concentrate on policy formulation.

“We simply do not have the human resources to manage the amount of aid and the different types of aid. The situation has grown up whereby different departments have implemented different solutions,” said one official.

Since 1990, the volume of overall EU grant aid to third countries managed by the Commission has grown from 2.3 billion ecu to 7.2 billion ecu, and is set to rise further to over 8 billion ecu by 1999.

Critics complain that the current ad hoc approach has resulted in a maze of different procedures which EU member states, economic operators and beneficiaries alike have difficulty in penetrating.

“Companies just do not know which tenders are open. There are no clear rules. The Commission has to find a better solution,” insisted one.

Increasing criticism from the Court of Auditors and the European Parliament is also making the continuation of present policies highly unrealistic. MEPs, in particular, have brought matters to a head by removing from the 1997 EU budget all financing for the 30-year-old European Cooperation Association (ECA), which manages 80-million-ecu worth of technical assistance projects annually. They have given the Commission until the end of March to find a more modern and transparent successor to the ECA.

The agency's backers believe that a unified body handling all external contracts would introduce better policy management, guarantee value for money, enhance the Union's visibility and ensure a consistent overall approach. They insist it would be responsible for policy implementation, not formulation.