Call for new regime to target funding

Date: 17/07/1997

THE EU is being urged to streamline its regional and social programmes and target spending on areas in greatest need as it attempts to bridge the economic divide between its members.

Under the Commission's plans, expenditure in the 15 existing member states will total 210 billion ecu between 2000 and 2006, with a further 20 billion ecu allocated to environmental and transport infrastructure projects under the cohesion fund.

An extra 45 billion ecu, including 7 billion ecu in pre-accession aid, will be earmarked for the applicant countries.

But in a bid to increase the impact of the EU's regional and social funds, the list of possible recipients will be narrowed considerably. “At the moment, over half of the Union's population benefits from structural aid. That is too much. The level should be brought down to around 40&percent;,” said Commission President Jacques Santer.

At the same time, there is increasing pressure for the existing rules to be applied more rigidly. In particular, any recipient region whose gross domestic product exceeds 75&percent; of the EU average would no longer be eligible for aid and existing funding would be phased out.

In addition, the Commission would like to see a radical overhaul of the eligibility criteria and has recommended reducing the seven basic categories to three. These would give overwhelming priority to regions whose economic development lags well behind the Union average, areas facing structural change and moves to help member states modernise their education, training and employment systems.

The simplification process would also lead to major alterations in the 13 special EU regional and social initiatives. The Commission argues these should be restricted to three central areas of cross-border cooperation, rural development, and the promotion of equal opportunities and human resources.