Use of Pre-Accession EU Grants by Municipalities

Transcription

1 Use of Pre-Accession EU Grants by Municipalities Hasan Çoban ( hcoban@dpt.gov.tr ) 04 March 2008 Iller Bank Facilities Ankara Seminar on Strengthening the Capacity for Absorption of EU Funds by Municipalities co-organized by the Undersecretariat of Treasury and Iller Bank Directorate General

2 AGENDA Funding Needs of Municipalities Instrument for Pre-Accession Assistance IPA Scope of IPA Operational Programs Legal Arrangements Fiscal and Administrative Framework EU Funds Available to Municipalities Process of Absorbing EU Financial Assistance 2

3 Service Cycle of Municipalities Own funds Loan (dom. & ext.) Grant (dom. & ext.) Services Funding Needs Operation, maintenance and repair Municipalities Investment Needs Inadequacy in services Needs Urban expansion and growth 3

4 Instrument for Pre-Accession Assistance IPA Instrument for Pre-Accession Assistance IPA: an instrument that determines the framework for the use of EU funds in the period Objective: To ensure that candidate states progress in line with the EU policies and standards; support the Harmonization Policy and assist them adopt the Acquis Communitaire, including the instruments on the path for membership. Implementation method: according to the IPA Regulation adopted by the EU Council on 17 July Covered states : candidate and potential candidate states. 4

5 Countries Covered by IPA and Funds Allocated Candidate states Turkey Croatia Potential candidate states Albania, Kosovo Bosnia and Herzegovina, Serbia, Monte Negro and Macedonia IPA draft budget 11.5 billion Euro ( ) 3.96 billion Euro ( ) Funds that can be allocated to Turkey under IPA 1.6 billion Euro ( ) 5

6 Instrument for Pre-Accession Assistance - Components Component 1 Transitional Period Support and Institution Building ( SG for EU Affairs) IPA Financial Assistance Components Component 5 Rural Development ( MARA) Component 2 Regional and Cross-Border Cooperation (SG for EU Affairs) Component 3 Regional Development ( SPO ) Component 4 HR Development ( MOLSS) 6

7 Instrument for Pre-Accession Assistance ( Scope of Components ) Transitional Period Support and Institution Building : This component covers the provision of technical assistance for improving the capacities of agencies and institutions. Regional and Cross-Border Cooperation: This component contributes to social and economic development through incentivizing entrepreneurship in border regions and increasing access to border regions. Regional Development Strategic Framework Document and Operational Plans (OPs) prepared Human Resources Development Rural Development: This component supports SMEs in rural areas and transportation and environmental protection infrastructure in rural areas (IPARD). 7

8 Legal, Regulatory and Administrative Structure of IPA Regulations in Turkey 9th Development Plan ( ) Medium-Term Program ( ) Preliminary National Dev. Plan ( ) Pre-Accession Economic Plan (2005) Sectoral Strategies - Rural Development SMEs Industry - Environment Transportation Regulations in the EU IPA Regulation ( ) Multi-Year Indicative Fiscal Framework Program (7-year) Accession Financial Strategy (7-year) Strategic Framework Document for Harmonization ( ) Trans. Per. Support and. Institution Building Regional and Cross-Border Cooperation Regional Development Human Resources Development Rural Development OP - Environment OP - Transportation OP Regional Competitivity OP- Human Resources Rural Development Plan (IPARD) 8

9 Institutional Organization for Use of IPA Funds HPC National IPA Coordinator (SGEU) Financial Cooperation Committee (FCC) Sectoral Coordinator (DPT) National Authorization Officer (National Fund) - (UoT) Implementing Agency (CFCU) Steering and Monitoring Committee Components 1 and 2 Ins. Building, Cross-Border Coop. Component 3: Reg. Dev. Component 4 : HR Dev. Component 5: Rural Dev. Ins. Build. C-B Coop SG for EU Affairs Steering Committee (Projects) Env MoEF Steering Committee (OP-1) Transport MoT Steering Committee (OP-2) Regional Comp. MoIT Steering Committee (OP-3) HR MoLSS Steering Committee (OP 4) Rural Development MoARA Agr. And Rur. Dev. Sup. Ag. Steering Committee (IPARD) Beneficiary Agencies: - Ministries - Municipalities - Public Agencies ( Project Impl. Units) 9

10 Steering and Monitoring Committees Sectoral Steering and Monitoring Committee Operational Program Steering Committee State Planning Organization (coordinator) Ministry of Transportation Ministry of Interior Ministry of National Education Ministry of Labor and Social Security Ministry of Industry Ministry of Environment and Forestry Ministry of Finance Ministry of Health Ministry of Energy Ministry of Culture and Tourism Undersecretariat of Treasury Secretariat General for EU Affairs Related Ministries or Agencies (coordinator) Representatives of agencies and institutions related with Operational Program 10

11 Instrument fort Pre-Accession Assistance ( Funds allocated for OPs between ) Total % Million Euro % Million Euro % Million Euro Million Euro Regional Development , , ,7 524,0 Regional Competitivity OP 25 41, , ,8 140,1 Environment OP 40 67, , ,6 204,1 Transportation OP 35 58, , ,3 179,7 HR Development - 50,2-52,9-55,6 158,7 Total - 217,7 226,7 238,3 682,7 11

12 Conditions of Eligibility for EU Projects Funds allocated to infrastructure projects with cost of more than 5 million Euro. 75% EU contribution provided to projects approved before For projects approved in 2008 and beyond, 55-75% of project financing deficit will be funded by EU. (EU contribution= (project cost project revenues) x 0.75) Projects linked with investment program. National contribution share to willing municipalities will be provided by Iller Bank in the form of loan. External loans may be used via Iller Bank as national contribution share. 12

13 Selection Criteria in Environmental Protection Projects 1. Compliance with environmental plans, sectoral strategies and policies. 2. Population (municipalities with higher population to be prioritized). 3. Municipalities facing financial constrains (municipalities with cofinancing capacities and municipalities capable of meeting operating costs will be prioritized). 4. Financial viability (selection in accordance with cost recovery principles and user and polluter pays principles). 5. Environmental priorities (infrastructure projects prioritizing the following objectives will be given priority). Public health improvement. Protection of vulnerable areas. Protection of natural resources. 13

14 Project Preparation and Execution Mechanism Project Preparation Stage Project Finance Project Implementation Municipalities Agencies Iller Bank IFI SPO -Ins. Cap. Dev. - Regional and Cross-Border Cooperation Pr. - Urban Infrastructure projects (water, wastewater and solid waste) National Contribution Share Financial Cooperation Com. SC for EU MFA, SPO, UoT Secretariat General for EU Affairs Ministry of Environment and Forestry National Fund (UoT) EU Commission EU Commission Beneficiary Agency, Municipality (PIU) CFCU 14

15 Infrastructure Projects under Environment OP Environment Operational Program (Environment OP) approved by HPC in Environment OP covers the period drinking water projects (70 million Euro) 12 wastewater projects ( million Euro) 10 solid waste projects ( million Euro) These projects, which will cost million Euro in total, will be carried out after the preparation of their feasibility reports. For the period , million Euro EU contribution and 68 million Euro national contribution are needed. Beneficiary agencies will be responsible for implementing the services relating to the tender process executed by CFCU. 15

16 Expectations - Recommendations Municipalities need to take a more active role in project preparation and implementation stages in order to absorb EU funds more efficiently. There is a need for implementing circular(s) on co-financing in the use of EU funds. International institutions should cooperate with Iller Bank to provide loans for EU-supported projects. Thank you! 16