EUROPEAN COMMISSION Conference on Economic Recovery and Growth in Romania, Bucharest, 26-27 October 2011 Poland: lessons from experience with EU funds absorption Pascal Boijmans, Deputy Head of Unit Directorate General for European Commission 1
Structure of Presentation Lessons learnt from the previous perspective Structure Structural Funds in Poland: 2007-13 Current progress in implementation Main challenges Conclusions 2
Poland: lessons learnt from the previous perspective 2004-06 Lessons learnt Structural Funds performed on average quite well Cohesion Fund (large infrastructure projects) lagging behind: transport better than environment lack of a strategic approach problems related to the selection of projects/dispersion of projects significant cost overruns, especially in Cohesion Fund/Exchange rate Euro/zloty Unstable legal framework: EIA/environment, public procurement issues Administrative capacity: staff turnover EC advocated for devolving more responsibility to the regional level 3
Poland: some key facts Poland: some facts GDP Head PPS: 1995: 43, 2010: 62 (EU27 = 100) GDP Growth (2000 = 100): POL: 141 (EU27 = 112) Employment rate (15-64) 59.2% (EU27 = 65.9%) (EU2020 target = 75%) Unemployment rate (2010): 9.6% (EU27 = 9.6%) Expenditure R&D/GDP: POL: 0.59% (EU2020 target = 3%) 4
EU Cohesion Policy in Poland 2007-13: financial data Poland: some facts Budget for Poland: 67.3 billion (19.4% of budget for EU27) Co-financing Poland: 14.1 billion (public) and 2.7 billion (private) the largest beneficiary of Cohesion Policy 21 Operational Programmes 5 national (74.3%) 16 regional (24.6%) 13 territorial cooperation (1.1%) Implementation: National: Ministry for Regional Development (MRD) Regional: regional self-governments Territorial cooperation: MRD 5
Poland: eligible regions 6
NSRF - Poland Operational Programmes Total EU allocation (m ) 16 Regional Operational Programmes 16 555.6 Infrastructure and Environment 27 913.6 Human Capital 9 707.2 Innovative Economy 8 254.9 Development of Eastern Poland 2 273.8 European Territorial Cooperation 731.1 Technical Assistance 516.7 Total (without performance reserve) 65 952.9 Total (with performance reserve) 67 284.2 7
SF implementation in Poland general Progress Overall situation: satisfactory, but not equally spread across programmes and sectors Regional OP s perform better than national OP s Small OP s perform better than larger OP s Some sectors much more problematic than others: Culture, health, higher education progressing very well Support to SMEs, innovation reasonable progress Railways, energy, and information society progress much slower Poland s progress is just above the average of EU-27 in commitments and payments in % terms 32.7% paid, no. 13 of EU27 MS 8
All SF: paid/decided ratios in EU 27 50% 45% 45,3% 40% 35% 40,3% 38,7% 38,3% 36,8% 36,0% 35,6% 34,6% 34,4% 34,4% 33,6% 32,9% 32,7% 32,6% 30% 29,0% 28,9% 28,9% 28,6% 28,5% 28,2% 29,18 % 25% 25,6% 25,6% 25,1% 23,1% 20% 18,6% 18,1% 15% 14,7% 10% 5% 0% Lietuva Eesti Sverige Ireland Deutschland United Kingdom Suomi/Finland Österreich Latvija Portugal Slovenija España Polska Kypros Danmark Belgique-België France Nederland Magyarország Ellada Slovenska Republica Luxembourg (Grand-Duche) Malta Ceska Republika Balgarija Italia România 9 Paid / Decided Average
Financial execution: EC payments - ranking of OPs 70% 60% 63,0% 61,3% 59,2% 53,8% 51,5% 50% 48,6% 48,0% 47,2% 47,1% 46,6% 45,0% 43,0% 42,8% 40% 30% 39,8% 39,4% 37,9% 37,3% 31,6% 28,9% 31,79% 24,1% 20% 10% 0% ROP Lubuskie ROP Opolskie ROP Swietokrzyskie ROP Wielkopolskie ROP Pomorskie ROP Malopolskie ROP Podkarpackie ROP Lodzkie ROP Podlaskie ROP Dolnoslaskie ROP Kujawsko-Pomorskie OP Technical Assisstance ROP Zachodniopomorskie ROP Lubelskie ROP Warminsko-Mazurskie ROP Slaskiego ROP Mazowieckie OP Development of Eastern Poland OP Innovative Economy OP Infrastructute and Environment Paid/decided Average 10
The main challenges Main Challenges Coordination of various policies and programmes special task for national authorities (especially Ministry for Regional Development): strategic approach Administrative capacity, especially at regional and local levels Demanding legal environment and economic constraints (budgetary constraints, inflationary tendencies, shortage of labour, continuous problems with compliance with EU law) Unprecedented challenge for spending (n+3/n+2 rule), especially for large projects 11
SF implementation in Poland Major Projects Progress Projects above 50 million : approval by EC 251 planned (~25% of all major projects in EU-27) Largest share: transport 108 received by EC 48 adopted Long process in terms of both preparation (PL) and adoption (EC) 12
Problem areas 13 Problematic sectors Railways: Strategy Planning capacity Public procurement issues Energy: Infringements State aid Public procurement Information society: broadband State aid Public procurement Scattered responsibilities
Major horizontal bottlenecks Problem areas State aid schemes New national law on EIA Environmental Impact Assessment Correct application of public procurement 14
Major bottlenecks state aid Problem areas PL notified schemes very late Delays in providing replies to DG COMP questions Result blockage in spending of funds for some sectors Implementation of some priority axes in some programmes started effectively later Administrative capacity Competition Office is partly supported from OP Technical Assistance 15
Problem areas Major bottlenecks - EIA Non-compliance of PL legislation Insufficient public consultations Decisions too early not all info available Lengthy negotiations with DG ENV resulted in modus operandi positive opinion can be given on basis of localisation decision Temporary solution transitional phase Need to process backlog of affected projects Administrative capacity GDOS & regional bodies supported by OP Technical Assistance 16
Major bottlenecks public procurement Problem areas 17 Non-compliance of PL legislation Rules for cancelling tenders Limited possibility for beneficiaries to correct offers Rules for introducing changes to tender notices, etc. and irregularities Tenders not published of OJ Usage of limited tenders without appropriate conditions being met Beneficiaries not informed of changes to tender notices after publication Result: risk of financial corrections in a significant number of projects PL legislation amended after lengthy discussions with EC Public Procurement Office supported by OP Technical Assistance
Measures to speed up implementation Corrective measures POL: allocation of performance reserve (1.3 bn ) and technical adjustment (632 mln ) Access criteria pushed OP s to increase absorption Focus on EU2020 relevant areas Midterm review EC: annual review meetings Follow up of recommendations EC: tripartite sector meetings on major projects EC, POL, Jaspers Upstream involvement in project preparation 18
Conclusions It is essential to have a focussed and strategic approach in place for sectors Selection criteria have to be transparent, objective and in line with strategy Legal framework needs to be in place and EU compliant in order to avoid delays in adoption of projects Need for qualitative improvement of major project applications: key investments for MS Special supportive actions are required for underperforming sectors 19
Thank you for your attention! Inforegio website: http://europa.eu.int/comm/regional_policy 20