1

Cohesion policy

in Slovenia A long term perspective

Dr. Peter Wostner

Zagreb, September 2013

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Pre-accession assistance in Slovenia (I)

Slovenia has been a recipient of PHARE assistance since 1992,

since 1999 Slovenia has also received pre-accession assistance

from ISPA and SAPARD programmes.

On the basis on the experience gained in implementing the

pre-accession instruments Slovenia formed the institutional

set-up for the implementation of the structural funds and the

Cohesion Fund.

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Pre-accession assistance in Slovenia (II)

PHARE programme:

Until 2004 Slovenia had received EUR 339.2 million. Slightly less than half of this sum was intended for the strengthening of institutional capacities in all areas and at all levels. The EU funds have been used for the projects of infrastructure, environment, transport, energy, and education.

ISPA programme:

Until 2004 Slovenia had received EUR 84.5 million. ISPA financed major environmental and transport investment projects and ended on 1 May 2004, when Slovenia became a member of the European Union. All ISPA projects in progress at the time are now financed under the Cohesion Fund.

SAPARD programme:

Until 2004 Slovenia had received EUR 25.7 million. SAPARD programmewas designed to promote agriculture and rural development and the Agency for Agricultural Markets and Rural Development was responsible for its implementation.

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Vir: Evropska komisija, 2004: Tretje Kohezijsko poročilo

2004-2006Structural Funds

Financial envelope in relative terms

.

Annual appropriations for commitments per year per capita and in the percentage of GDP in the

closing year of negotiations by states, for regions eligible under objective 1 and the Cohesion

fund (regions and countries eligible under the transition period regime are excluded) in the period

2000-2006 for Member States and 2004-2006 for Acceding Countries. Values per capita are

expressed in EUR, fixed prices 1999, while % of GDP is expressed per year and in prices quoted in

the table.

EU 15 Austria Germany Greece Spain Finland France Ireland Italy Portugal Sweden UK Total

Objective 1 135,3 194,1 285,8 232,2 121,1 282,7 194,7 162,3 348,2 104,1 143,0 217,4

Cohesion Fund 40,0 39,6 42,5 40,1

Total 135,3 194,1 325,8 271,8 121,1 282,7 162,3 390,7 104,1 143,0 257,5

Total as % of GDP 1999 1.14* 2,91 1.16* 2,54

EU 10 Estonia Hungary Latvia Lithuania Malta Poland Slovakia

Czech

Rep. Slovenia Total

Objective 1 80,1 57,8 78,4 75,8 47,4 63,2 63,9 47,2 35,2 60,4

Cohesion Fund 67,3 32,5 65,3 52,0 16,7 32,2 31,4 27,2 28,3 33,8

Total 147,4 90,3 143,7 127,9 64,2 95,4 95,4 74,3 63,4 94,3

Total as % of GDP 2002 3,10 1,42 4,02 3,22 0,61 1,96 1,97 0,96 0,57

*relating only to GDP of the regions eligible under objective 1 - Beutel, 2002; in the case of Italy, also Sardinia, which is eligible

under the transition period regime, is taken into account.

Source: Own calculation based on European commission, 2004, Eurostat - New Cronos

Programming structure

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Slovene Economic Development Strategy 2001-2006

Regional Development Programmes

Strategy Projects

Single Programming Document 2004-2006

National Development Plan RS 2001-2006

& Programme Complement

Eur. guidelines for structural and cohesion funds

Implementing structure of the

measure

Call for projects & tenders

Coh. regulations

7 © PWostner

SPD: priorities and financesEUR, current prices

Total %

1 Promotion of the productive sector and competitiveness 129,240,164 54.4

1.1 Promoting development of innovative environment 25,848,033 10.9

1.2 Promoting the development of tourist destinations 25,848,033 10.9

1.3 Improving the support environment for entrepreneurship 19,386,024 8.2

1.4 Economic infrastructure and related public services 58,158,074 24.5

2

Knowledge, human resource development and

employment 72,674,342 30.6

2.1 Developing and promoting active labour market policies 21,802,303 9.2

2.2 Facilitating social inclusion 7,267,435 3.1

2.3 Lifelong learning 21,802,302 9.2

2.4 Lostering enterprenurship and adaptability 21,802,302 9.2

3 Restructuring of agriculture, forestry and fisheries 25,350,133 10.7

3.1

Improvement of processing and marketing of agricultural

products 8,249,182 3.5

3.2 Investments in agricultural holdings 7,070,728 3.0

3.3

Diversification of agricultural activities and activities close to

agriculture (alternative income sources) 4,713,819 2.0

3.4

Investments in forests to improve their ecological and

economical value 2,356,909 1.0

3.5 Marketing of quality agricultural and food products 1,178,455 0.5

3.6

Modernization of existing vessels and small-scale coastal

fisheries 890,520 0.4

3.7 Aquaculture, processing and marketing 890,520 0.4

4 Technical assistance 10,244,958 4.3

TOTAL 237,509,597 100.0

Priority/Measure

8 © PWostner

Managing

Authority

Government

Office for Local

Self-Government

and regional

policy

PA

PA

Paying Authority

Ministry of

Finance, National

Fund

Independent body

for financial control

Ministry of Finance,

Budget Supervision

Office

Intermediate Body for

ERDF

Ministry of the

Economy

Intermediate Body

for ESF

Ministry of Labour,

Family and Social

Affairs

European

Commission

Intermediate Body for

EAGGF and FIFG

Ministry of

Agriculture, Forestry

and Food

2004-2006 implementation structure

MINISTRIES MINISTRIES

CONTROLS

Programme

Council

Programme

Council

Programme

Council

Absorption of SPD 2004-2006

ERDF 100,0%

ESF 98,6%

FIFG 100,00%

EAGGF 97,7%

TOTAL 99,3%

Actual 04-06 budget execution (%)

10 © PW

Budgetary exp. (€)

11 © PW

12 © PW

Net budgetary impact

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Convergence: €199.3 bn. (57.4%)

Phasing out: €13.9 bn. (4%)

Phasing in: €11.4 bn. (3.3%)

Competit.: €43.5 bn (12.5%)

Cooperation: €8.7 bn. (2.5%)

Cohesion Fund: €69.6 bn.(20%)

Total: €347.4 billion

in current prices

Structural funds allocation by type of region

2007-13

14 © PW

Allocation by MS, current prices

… in per capita terms…

15

Nacionalne ovojnice (EUR na prebivalca)

0

50

100

150

200

250

300

350

Belgi

umDen

mar

kGer

man

yGre

ece

Spa

inFr

ance

Ireland Italy

Luxe

mbo

urg

Net

herla

nds

Austria

Por

tuga

lFi

nlan

dSw

eden

Unite

d Kingd

omBulga

riaCyp

rus

Cze

ch R

epub

licEston

iaHun

gary

Lith

uania

Latv

ia

Malta

Poland

Rom

ania

Slov

enia

Slova

k Rep

ublic

Kohezijska ovojnica (EUR na prebivalca) Razvoj podeželja (EUR na prebivalca)

Slovenia’s Developement Strategy

PARTNERSHIPS,REGIONAL DEVELOPEMENT PROGRAMMES

OP forStrengthening Regional

Development Potentials

National Developement Programme RS 2007-2013NATIONAL STRATEGIC REFERENCE FRAMEWORK

Lisbon Strategy

MC

Tenders, calls

CP legal framework

OP for Development of

Human Resources

OP for Development of Environment and Transport Infrastructure

07-13 programming structure

17 © PW

Human resources -

active employment

policy; 11,6%

Environmental

Infrastructure; 13,2%

Education and training

systems; 4,1%

Tourism, culture and

sports; 6,6%

Sustainable energy;

4,0%Efficient public sector;

2,4%

Development of

Regions; 15,4%

Entrepreneurship and

competitiveness; 19,9%

Transport

Infrastructure; 22,8%

Slovenia... using the money for

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Financial allocation by OP

#

Operational programmes FundEU funds

(in mio. €, 2004

prices)

% % %

1

OP for strengthening regional

development potentialsERDF 1.709.749.522 40,7 41,7 63,6

2OP for human resources develpment ESF 755.699.370 18,0 18,4 28,1

CF 1.411.569.858 33,6 34,4

ERDF 224.029.886 5,3 5,5 8,3

4Cross-border programmes ERDF 96.941.042 2,3

5Trans-national programmes ERDF 7.315.278 0,2

Total: 4.205.304.956 100,0 100,0 100,0

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OP for development of environmental and

transport infrastructure

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OP for strengthening regional

development potentials

Innovative, dynamic and open Slovenia, with developed

regions and competitive, knowledge- based economy

Original 2007 2010 modifications Change

OP regional development potentials 1.709.749.522 % 1.768.249.522 % 58.500.000

1. Competitiveness and research excellence402.133.645 23,5 598.116.998 33,8 195.983.353

2. Economic-development infrastructure396.934.393 23,2 269.451.040 15,2 - 127.483.353

3. Integration of natural and cultural resources263.235.116 15,4 253.235.116 14,3 - 10.000.000

4. Development of regions619.442.634 36,2 619.442.634 35,0

5. Technical Assistance28.003.734 1,6 28.003.734 1,6 -

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OP of the environmental and transport

infrastructure development

Objective:

ensuring conditions for growth

by providing sustainable mobility, improving

environment quality and

relevant/appropriate infrastructure

Original 2007 2010 modifications Change

-

OP environmental and transport

infrastructure 1.635.599.744 %

1.577.099.744 &

-

58.500.000

1. Railway infrastructure - CF449.567.581 27,5 449.567.581 28,5 -

2. Road and maritime infrastr. - CF241.370.738 14,8 220.930.911 14,0 - 20.439.827

2.1. Road sector 206.840.911 12,6 220.930.911 14,0 14.090.000

2.2. Maritime sector 34.529.827 2,1 - - 34.529.827

3. Transport infrastrucutre - ERDF224.029.886 13,7 165.529.886 10,5 - 58.500.000

4. Municipal waste management205.568.426 12,6 155.568.426 9,9 - 50.000.000

5. Environmental protection - water sector325.483.339 19,9 392.923.166 24,9 67.439.827

5.1. Collection and treatment of waste-

water 102.784.212 6,3

170.224.039 10,8 67.439.827

5.2. Drinking water supply 148.466.085 9,1 148.466.085 9,4 -

5.3. Reduction of water damages 74.233.042 4,5 74.233.042 4,7 -

6. Sustainble use of energy 159.886.553 9,8 159.886.553 10,1 -

7. Technical Assistance29.693.221 1,8 32.693.221 2,1 3.000.000

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OP for human resources

development

to invest in people,

whose capital will secure

higher level of innovation, employability and economic growth,

which is the best way to ensure

high employment, social inclusion, the reduction of regional

differences and

high standard of living

OP human resources ESS resources;

euro %

SKUPAJ755.699.370 100,0

1. Promoting entrepreneurship and adaptability 262.114.965 34,7

2. Promoting employability of job-seekers and inactive 140.018.678 18,5

3. Human resource development and life-long learning 164.661.965 21,8

4. Equal opportunities and Reinforcing social inclusion 63.848.517 8,4

5. Institutional and administrative capacity 97.051.506 12,8

6. Technical assisstance 28.003.739 3,7

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2007-2013 implementation…

118% of funds published calls for projects

85% contracted

55% paid from the budget

48% retrieved back from the EU budget

CP payment profile wihtin financial

perspective: EU level

25 © PW

Overlapping financial perspecitves

26 © PW

Payment level 2004-2013 H1b

0

10

20

30

40

50

60

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Year

Paym

ents

(B

ln)

1994-1999

2000-2006

2007-2013 advance

2007-2013 interim

Within year execution (2011): EU

level

27 © PW

0

2

4

6

8

10

12

14

16

18

1 2 3 4 5 6 7 8 9 10 11 12

Month

Bln

€

Payments for programmes of H1B Payments requests

2007-2013 rules in SLO …. The HOW

• Decree on the implementation of procedures for the use of the European cohesion policy funds in the Republic of Slovenia in the programming period 2007-2013 (OG RS, No 41/2007)

• Communication plan for the operational programmes in the programming period 2007-2013

• Guidelines of the managing authority on information and publicity about the Structural Funds and the Cohesion Fund in the programming period 2007-2013

• Manual of the complete graphical image of the structural and cohesion fund

• Guidelines of the managing authority on eligible costs under European cohesion policy funds in the programming period 2007-2013

• Guidelines of the managing authority for the preparation, application and approval of the instruments for cohesion policy implementation in the programming period 2007-2013

• Guidelines of the managing authority for monitoring of and reporting on cohesion policy implementation in the programming period 2007-2013

• Guidelines of the managing authority for performance of controls pursuant to Article 13 of Commission Regulation (EC) No 1828/2006

• Guidelines of the managing authority for the implementation of technical assistance of cohesion policy 2007-2013

• Guidelines for reporting about education, training and studying within cohesion policy 2007-2013

• Guidelines for state aids

• Guidelines for monitoring operational programmes with information system ISARR

Assessment of the management and control systems compliance

–KPMG and the European Commission

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ONE Managing Authority with Intermediate bodies

OP IB

ERDF 1. Ministry of the Economy

Government Office for Local Self-Government and Regional Policy

2. Ministry of Higher Education, Science (and Technology),

Ministry of Education and Sport

Ministry of Culture

3. Ministry of Health

ESF 1. Ministry of the Economy

2. Ministry of Higher Education, Science (and Technology)

Ministry of Education and Sport

Ministry of Culture

3. Ministry of Labour, Familiy and Social Affairs

4. Ministry of Public Administration and Justice

5. Ministry of Health

CF

(+ERDF)

1. Ministry of Transport

2. Ministry of the Environment (and Spatial Planning)

3. Ministry of the Economy

Why centralised implementation system

1. EU dimension: one stop shop, one responsibility towards Brussels

� better negotiating position

2. Policy making dimension:

– Better position to link public investment funding with reform agenda

– Complementarities among policy areas

– Stronger incentives for well performing policies / ministries

3. Administrative dimension:

– One set of rules domestically � good for beneficiaries, good for

administration: economies of scale (e.g. methodologies for the use of

simplified costs)

– One counterpart to M of finance

– Staffing strategy & rules

– One information system, one set of reports, publicity and communication

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What do intermediate bodies / line ministries do

• Hold responsibility for „their“ policy areas: determine content of programming

documents based on „their“ strategies

• Preparation of calls for proposal, proposals for direct approval of operations;

• Project selection and approval of operations;

• Contracting

• Regular monitoring of operations and reporting to the MA to confirm their execution;

• Administrative controls + some on the spot;

• Preparation of applications for reimbursement;

• Reporting;

1. Ministries allocate the funds to the beneficiaries through calls for proposals

(municipalities, enterprises, NGOs), sign a co-financing agreement with the

beneficiaries.

2. Payments made out of the national budget match the actual implementation. After the

signing of the agreement, the beneficiaries launch project activities. When the latter are

implemented, the costs incurred are reimbursed from the national budget.

3. Reimbursements are made from the EU budget to the national budget. In the last

phase the expenses incurred in the national budget are reimbursed by inflows from

the EU budget.

Basic logic of the financial management system

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Hierarchy of decisions & project selection

• OPs are implemented on different levels, as follows:

1. Priority axes

2. Activity fields

3. Operations

• MFF Council conclusions from Feb 2013:

– Application of the competition principle to project selection:

91. Member States must ensure that the selection of projects is based on procedures

and criteria, which are non-discriminatory, transparent and in full compliance with

Union and national law so that only the best projects are chosen.

• Selection of operations („instruments“):

1. Call for proposals

2. Direct approval of an operation

1. Project

2. Group of projects

3. Programme implemented by the beneficiary

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The battle for IMPROVEMENTS …

• Advance payments

• VAT as eligible cost

• Use of flat-rates for ESF and ERDF

• Introduction of shorter payment deadlines for investment transfers . paymentmade from the national budget to the municipalities day before the payment tothe contractor falls due

• Modified Guidelines on eligible costs which bring less administrative burden

• New financial instruments (FI)

• Simplifications in the process of preparation and approval of instruments

• Elimination of double administrative controls (shorter deadline for payment tothe beneficiaries)

• Overcommitments

2014…

WESTERN

SLOVENIA

EASTERN

SLOVENIA

211 MUNICIPALITIES - NUTS 5

12 DEVELOPMENT REGIONS - NUTS 3

2 COHESION REGIONS - NUTS 2

REGIONAL DIVISIONS OF SLOVENIA

Cohesion policy funds (in mio. €)

-32 ; +9 ; +38

KEEP IT SIMPLE!!!

peter.wostner@gov.si

pwostner@yahoo.com

Thank you ☺

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