4.4.2. The European Regional Development Fund (ERDF)
Articles 158 to 162 (130a to 130e) ECT (*4.4.1.).
To help redress regional imbalances through participation in:
- the development and structural adjustment of regions whose development is lagging behind;
- the conversion of declining industrial regions (Article 160 (130c)).
The ERDF was set up in 1975 and has become the main instrument of the Community's regional policy.
a. The main principles by which it currently operates were laid down by the general reform of the Structural Funds in 1988 (*4.4.1.). 'Community support frameworks' negotiated between the Commission, the Member States and the regional authorities lay down the broad outline of the measures that commit the Member States and the Community jointly and provide a reference framework for operational programmes submitted by the Member States. The Commission has the final decision on co-financing these programmes.
b. The regulations reforming the Structural Funds in 1993 (*4.4.1.) gave the ERDF the following four objectives for the period 1994 - 99:
- Objective 1: development and structural adjustment of regions whose development is lagging behind;
- Objective 2: redevelopment of regions severely affected by industrial decline;
- Objective 5b: development of rural regions;
- Objective 6: fostering the Arctic regions (this objective was included when Sweden and Finland joined).
80% of the Fund's resources are reserved for Objective 1.
c. Community initiatives are projects which affect the whole Community, for which the Commission alone is responsible.
The 1993 regulations laid down the relevant sectors:
- interregional cooperation;
- employment and manpower;
- industrial development;
- very remote regions;
- urban policy;
- rural development.
The main programmes are:
- INTERREG, which supports cross-border cooperation projects between regions at the Community's internal and external borders, in very varied fields;
- URBAN, which applies to problematic urban areas (high unemployment, run-down buildings, poor housing and inadequate social network);
- KONVER, which encourages the arms industry to convert to civilian activities.
2. The new regulation (1999 *4.4.1.)
The regulation adopted in 1999 for the period 2000 - 2006 (Council Regulation 1261/99 of 21 June 1999) limits the ERDF's objectives to two:
- Objective 1, which is unchanged: development and structural adjustment of regions whose development is lagging behind, but it now includes the areas which were eligible under Objective 6 and the very remote regions;
- Objective 2, which is new: economic redevelopment and development of areas with structural problems; this covers the former Objectives 2 and 5b and extends them to other areas: urban areas in difficulty, crisis-hit areas dependent on fisheries and areas heavily dependent on services.
b. Eligible areas
The eligible areas under Objective 1 are:
- Those whose GNP is less than 75% of the Community average, a list of which is drawn up by the Commission;
- Very remote regions (French overseas territories, Azores, Madeira and the Canary Islands);
- Areas covered by Objective 6.
All these areas represent about 20% of the EU population.
There are four types of Objective 2 area, covering about 18% of the EU population: industrial, rural, urban and fishery-dependent. The Commission in close cooperation with the Member States concerned will draw up a list.
c. Transitional arrangements
There are transitional assistance arrangements for regions which were eligible under Objectives 1, 2 and 5b in 1999 but are no longer eligible in 2000.
d. Community initiatives
The sectors to which these apply have been reduced to three:
- transfrontier, transnational and interregional cooperation to stimulate development and coordinated, balanced, European-level regional planning;
- rural development;
- transnational cooperation on new practices to deal with any kind of discrimination or inequality in access to employment.
The number of programmes has been reduced to four: INTERREG, URBAN, LEADER and EQUAL.
Their funding has been cut back to about 5% of the total for the Structural Funds.
e. Allocation of responsibilities
This has been spelt out more clearly:
- the Commission underwrites the strategic priorities;
- programme management is more decentralised, with a greater role played by regional and local authorities and the economic and social partners.
ROLE OF THE EUROPEAN PARLIAMENT
*4.4.1. The code of conduct adopted with the Commission in 1993 and expanded in 1999 requires Parliament to be kept regularly informed of the Fund's activities. Under the 1999 reform, Parliament also succeeded in retaining the URBAN programme as one of the Community initiatives.