Council extends Cohesion Fund for 2000-06
The Council formally adopted amendments to the Cohesion Fund for 2000 to 2006 on 21 June 1999, confirming continued support to Spain, Portugal, Ireland and Greece for projects connected with the environment and trans-European transport networks. The Cohesion Fund was set up after the Single European Act of 1987 first introduced economic and social cohesion as a key Community policy in its own right. More recently, following the 1993 Maastricht Treaty, the Cohesion Fund became important in assisting the poorest countries in the EU in their bids to qualify for joining the single European currency. The Cohesion Fund has supported investment in infrastructure, allowing these Member Sates to concentrate on reducing their budget deficits and control public debt in line with the convergence criteria for the euro. In the next period, for those countries which have joined the euro, the Fund will help them in maintaining these economic conditions. Despite support from the Cohesion Fund over the past few years, Spain, Portugal, Ireland and Greece still have per capita GNP lower than 90% of the Community average and so all qualify to continue receiving support from the Fund. 18,000 million euro will be available to the Cohesion Fund between 2000 and 2006, which will be broken down over the years as follows: - First four years, 2,615 million euro per year; - For 2004 and 2005, 2,515 million euro in each year; - For 2006 2,510 million euro. Spain is to receive between 61 and 63.5% of the overall resources, Greece 16 to 18%, Portugal 16 to 18% and Ireland 2 to 6%. The Cohesion Fund supports environmental projects, particularly those related to preserving, protecting and improving the quality of the environment; protecting human health; and assuring prudent and rational use of natural resources. In effect, the majority of projects funded relate to improvements in water and sewage systems. Transport infrastructure projects are also funded within the trans-European transport networks (TENs), or projects providing access to the TENs. The main changes to the Cohesion Fund in 2000 to 2006 affecting projects are: - Before projects can begin, there will be more thorough evaluations than at present, as well as more detailed appraisals of any alternatives and the environmental impact; - The rate of Community assistance will remain at 80 to 85% of public expenditure, but this will be reduced if projects generate an income, or where the 'polluter pays' principle is applied; - Financial management should be simpler, with projects receiving advances of up to 20% of the total assistance. Further payments will be based on the project's actual expenditure, and balances will be 10 to 20% depending on the size of the projects. The eligibility of these countries will be reviewed before the end of 2003, and if any then have a per capita GNP equal to or exceeding 90% of the Union average, the country will lose its qualifications for support.
Countries
Greece, Spain, Ireland, Portugal