Explanatory Memorandum to COM(2020)409 - Technical Support Instrument - Main contents
Please note
This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2020)409 - Technical Support Instrument. |
|---|---|
| source | COM(2020)409  |
| date | 28-05-2020 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
The outbreak of the COVID-19 pandemic has changed the economic outlook for the years to come in the Union and in the world. The short-term impact of the COVID-19 crisis in individual Member States will depend on the duration and severity of the lockdown measures, the composition of output and the economic policy measures taken to cushion the immediate impact of the crisis. The medium and long-term effects of the crisis will depend on the resilience of their economies. Given the differences in short-term economic impact and in available policy space, there is a real risk that the COVID-19 crisis will cause further widening of the divergences in the Union in the absence of decisive policy action.
As confinement measures are gradually lifted, there is a need to strategically plan the recovery, revitalising the economy and getting back on a path of sustainable growth. This requires supporting public and private investments but also enhancing Member States’ reform efforts to address the underlying social and economic weaknesses of their economies, improve their resilience and facilitate the return to sustainable growth. In that regard, it is crucial to continue accompany Member States’ reform efforts by providing them with substantial technical support to strengthen their administrative capacity to prepare and implement the reforms that will foster resilience and underpin the recovery.
This Regulation proposes to establish a standalone Technical Support Instrument available to all Member States, as a successor to the Structural Reform Support Programme (SRSP) 1 . The Technical Support Instrument will ensure that the Commission can continue to provide tailor-made expertise on the ground to ensure that the Member States have the necessary institutional and administrative capacity to develop and implement growth enhancing reforms and are able to strengthen the resilience of European economies through efficient and well-functioning administrative structures. To that end, as under the Structural Reform Support Programme, it will aim to accompany the national authorities of the requesting Member States throughout the stages or in specific phases of the reform process.
For reasons of expediency, and with a view to reaching an agreement as soon as possible by the co-legislators, this proposal for a regulation takes as a basis the latest text of the technical support instrument contained in the Commission proposal establishing a Reform Support Programme (RSP) 2 as discussed by the co-legislators in the past months. The proposal for the Reform Support Programme is withdrawn.
On 31 May 2018, the Commission proposed the Reform Support Programme in the context of the proposals for sectoral programmes of the Multiannual Financial Framework (MFF) for 2021-2027. That proposal included a technical support instrument, aimed to support the endeavours of Member States to enhance the implementation of structural reforms in the context of the European Semester. The text of that proposal was discussed in the Council under the Finnish and Croatian presidencies and an agreement in principle was reached in the Council on that instrument. In parallel, the European Parliament had been working on the Commission’s proposal for the Reform Support Programme and tabled its draft report on 20 April 2020.
In parallel to the present proposal, in order respond to the new challenges posed by the COVID-19 crisis, the Commission has also proposed a regulation for a Recovery and Resilience Facility 3 that will provide large scale financial support for public investments and reforms that make Member States economies more resilient, and better prepared for the future. The Technical Support Instrument can support Member States in the preparation and implementation of recovery and resilience plans under the Recovery and Resilience Facility.
• Consistency with existing policy provisions in the policy area
The Technical Support Instrument allows the Commission to support Member State authorities in their efforts to design reforms according to their own priorities and enhance their capacity to develop and implement reform policies and strategies, as well as benefitting from good practices and examples of peers. Technical support will be particularly needed in the aftermath of the crisis. This proposal therefore adequately complements the packages of measures that are proposed by the Commission to address the economic fallout of the COVID-19 pandemic, namely the Recovery and Resilience Facility, the REACT EU 4 under the structural and cohesion funds, the amended proposals for the European Fund for Strategic Investments (EFSI) and InvestEU, and the range of measures developed in response to the current COVID-19 pandemic such as the “Coronavirus Response Investment Initiative” 5 .
The Technical Support Instrument builds on the success of the SRSP, which has constantly experienced positive feedback from beneficiary Member States and excess demand in respect of the budgets available in the past selection rounds (e.g. for the 2019 round, of the 508 requests submitted, equating to a total value of EUR 194 million, 263 amounting to EUR 79.3 million could be selected; for the 2020 round, of the 609 requests submitted, equating to a value of EUR 250 million, 228 amounting to EUR 84.7 million could be selected). The Technical Support Instrument is designed as a continuation of the existing SRSP, and is consistent, coherent and complementary to the existing resources for capacity building and technical assistance, which are available within other Union financing programmes. Technical assistance available under cohesion policy aims to help stakeholders implement Union-funded programmes and projects, in the form of financial support for preparation, management, evaluation, monitoring, audit and control made available through the European Regional Development Fund (ERDF), European Social Fund (ESF) and Cohesion Fund. Technical assistance available in that context therefore aims at building capacity to administer Union funds and at fostering the implementation of projects co-financed under Union funds, thereby facilitating the absorption of these funds. The technical assistance hub available under the InvestEU is mainly targeted at the preparation of large (private) investment projects and does not target structural reforms. By contrast, the Technical Support Instrument aims at providing support for administrative capacity and long-term structural reforms, thereby adequately complementing and adding value to the existing assistance provided by the various sectoral Union programmes and the actions carried out under the Union funds.
Furthermore, this instrument is consistent with the policy guidance provided under the European Semester, by providing technical support to foster the implementation of the country specific recommendations addressed to Member States in that context.
• Consistency with other Union policies
The proposal is consistent with and provides for complementarity and synergies with the other Union policies.
The aim of the proposal establishing a Recovery and Resilience Facility is to offer financial support for public investments and reforms, in particular in the field of the green and digital transitions, that make economies more resilient and better prepared for the future.
The technical support instrument will be complementary to the proposal establishing a Recovery and Resilience Facility, as it will provide support for strengthening the administrative capacity of the Member States and, in this context, support for the preparation and implementation of the recovery and resilience plans that set out reforms and investments to be financed under the Recovery and Resilience Facility and, more in general, also for providing support for national reform actions related to the green and digital transitions.
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The proposal is based on Articles 175 (third paragraph) and 197(2) of the Treaty on the Functioning of the European Union.
Article 175 (third paragraph) TFEU provides that, if specific actions prove necessary outside the Funds and without prejudice to the measures decided upon within the framework of the other Union policies, such actions may be adopted by the European Parliament and the Council acting in accordance with the ordinary legislative procedure and after consulting the Economic and Social Committee and the Committee of Regions.
Article 197(2) TFEU provides that the Union may support the efforts of Member States to improve their administrative capacity to implement Union law, inter alia, through facilitating the exchange of information and supporting training schemes. No Member State shall be obliged to avail itself of such support. The European Parliament and the Council, acting under the ordinary legislative procedure are to establish the necessary measures to this end, excluding any harmonisation of the laws and regulations of the Member States.
In view of Articles 175 and 197 TFEU, the regulation is aimed at enhancing cohesion, through measures that allow recovery, resilience and convergence in/of the Member States concerned.
• Subsidiarity (for non-exclusive competence)
The funding of the proposed activities through the envisaged regulation respects the principles of European added-value and subsidiarity. Funding from the Union budget concentrates on activities whose objectives cannot be sufficiently achieved by the Member States alone (“necessity test”), and where the Union intervention can bring additional value compared to action of Member States alone.
The objective of the regulation is to promote cohesion by supporting Member States efforts to implement reforms necessary to achieve economic and social recovery, resilience and convergence, and to support Member States’ efforts to strengthen their administrative capacity to implement Union law in relation to challenges faced by institutions, governance, public administration, and economic and social sectors.
The underlying logic of the regulation is that technical support is provided in response to a request from the Member State concerned made on a voluntary basis. As a result, each Member State decides whether action at Union level is necessary, in light of the possibilities available at national, regional or local level. The implementation of technical support measures linked to the economic and social recovery, resilience and convergence, and to the strengthening of the administrative capacity of Member States to implement Union law is a matter of common interest for the Union.
The Technical Support Instrument replaces current the SRSP and is furthermore part of the initiatives taken by the Commission in response to the outbreak of the COVID-19 pandemic, for helping Member State mitigate the huge economic and social consequences. Action at Union level is thus necessary to achieve a fast and robust economic recovery in the Union. This goal cannot be achieved to a sufficient degree by the Member States acting alone, while the Union's intervention can bring an additional value by establishing a regulation that sets out an instrument offering strengthened technical support as regards the design and implementation of much needed structural reforms. Such support would contribute to also mitigate the societal impact caused by the present COVID-19 crisis.
• Proportionality
The proposal complies with the proportionality principle in that it does not go beyond the minimum required in order to achieve the stated objective at European level and which is necessary for that purpose. The voluntary character of technical support instrument and the consensual nature of the cooperation throughout the entire process constitute an additional guarantee for respecting the proportionality principle and for the development of mutual trust and cooperation between the Member States and the Commission.
• Choice of the instrument
The goals described in the preceding sections cannot be reached through a harmonisation of legislations, or by voluntary action of the Member States. Only a regulation would allow them to be achieved. A regulation applicable to all Member States is also the most appropriate legal instrument to organise the provision of technical support with a view to ensure equal treatment of Member States.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
The Technical Support Instrument is a continuation of the existing 2017-2020 SRSP, based on the Regulation (EU) 2017/825, as amended by Regulation (EU) 2018/1671 6 . Implementation of the SRSP began with the adoption of the 2017 Annual Work Programme 7 in September 2017 and has continued with the adoption of the subsequent work programmes 8 . In accordance with Article 16 of the SRSP Regulation, the Commission provides the European Parliament and the Council with annual monitoring reports on the implementation of the Programme 9 and an independent mid-term and ex-post evaluation report.
A Commission’s staff working document accompanying the independent mid-term evaluation report, soon to be adopted by the Commission, examined the performance of the SRSP against the evaluation criteria (relevance, effectiveness, efficiency, coherence and EU added value) and drew a number of lessons. Even though the programme was adopted recently and many technical support projects are still at the initial phases of the implementation, the findings demonstrate that the SRSP is progressing well towards achieving its objectives. The evaluation namely shows that the design of the SRSP is well aligned with the actual needs of Member States and serves as an appropriate instrument for supporting Member States in strengthening their administrative and institutional capacity. The high degree of flexibility and the absence of co-financing requirements make it possible to translate Member States’ needs into feasible actions with realistic timelines and to meet the expectations of the Member State. Sharing good practices among Member States was also evaluated as having significant added value. Furthermore, the SRSP is well integrated in the Union economic governance process. The annual cycles of the SRSP and the European Semester are adequately feeding into each other, which enables a comprehensive and coordinated approach towards structural reforms in Member States. A high degree of commitment from all stakeholders, a high level of expertise of the technical support providers and favourable political circumstances are considered factors that have a positive influence on the delivery of the SRSP project outputs. A lack of collaboration among stakeholders and changing or uncertain political circumstances are considered to have a negative influence on the successful implementation of technical support projects.
• Stakeholder consultations
Due to the urgency to prepare the proposal so that it can be adopted in a timely manner by the co-legislators, a formal stakeholder consultation could not be carried out. The views of the stakeholders were taken into account also in the course of the legislative process on the proposal for the Reform Support Programme.
• Impact assessment
Due to the urgent nature of the proposal, no new impact assessment was carried out. The present proposal for a regulation anyhow builds on the latest available text of the Council working party on the RSP proposal as regards the technical support instrument and is consistent with the joint draft report of the Committee on Budgets and the Committee on Economic and Monetary Affairs of the European Parliament on the technical support instruments contained in the RSP proposal, published on 20 April 2020. This proposal replaces in part the original Commission proposal for the RSP (COD …), which was based on an impact assessment, whose main findings remain valid mutatis mutandis.
• Fundamental rights
The proposal has a positive effect on the preservation and development of Union fundamental rights, assuming that the Member States request and receive support in related areas. For example, support in areas such as labour markets and social insurance, healthcare, education, the environment, property, public administration and the judicial system can support Union fundamental rights such as dignity, freedom, equality, solidarity, citizens' rights and justice.
4. BUDGETARY IMPLICATIONS
The financial envelope for the implementation of the Technical Support Instrument for the period 1 January 2021 to 31 December 2027 shall be EUR 864 406 000 (in current prices).
The legislative financial statement provides the appropriate explanations on the financial envelope.
5. OTHER ELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
In order to monitor the performance of this regulation in delivering on the objectives of the technical support instrument, some key performance indicators have been identified and will be collected periodically. Specific result and impact indicators will be defined in relation to the concrete projects, with baselines and targets, in order to monitor the progress made towards the final targets and to evaluate the impact of the implemented reforms.
A mid-term evaluation and an ex-post evaluation will be carried out with a view to assessing the effectiveness, efficiency, relevance, coherence of the instrument. Evaluations will be carried out in line the Interinstitutional Agreement of 13 April 2016 10 . Evaluations will include lessons learned to identify any deficiencies and/or problems or any potential to further improve the actions or their results and help maximise their exploitation and impact.
The mid-term evaluation of the Regulation will be performed once sufficient information is available about its implementation, but no later than four years after the start of the implementation. No later than three years after the end of the period of application of the Regulation, an ex-post final evaluation will be carried out by the Commission. The Commission will communicate the conclusions of the evaluations accompanied by its observations, to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions.
• Detailed explanation of the specific provisions of the proposal
The Regulation establishes the Technical Support Instrument, which will support, with technical measures, Member States to carry out institutional, administrative and growth-sustaining and resilience-enhancing structural reforms (Article 1).
The general objective of the technical support instrument is to promote cohesion by supporting Member States efforts to implement reforms necessary to achieve economic and social recovery, resilience and convergence, and to support Member States’ efforts to strengthen their administrative capacity to implement Union law in relation to challenges faced by institutions, governance, public administration, and economic and social sectors. (Article 3)
Specific objectives of the instrument are set out (Article 4) as assisting national authorities in improving their capacity to design, develop and implement reforms, including through exchange of good practices, appropriate processes and methodologies and a more effective and efficient human resources management. They are to be pursued in close cooperation with the Member States concerned.
The scope of the application is a broad range of policy domains that include areas related to public financial and asset management, institutional and administrative reform, business environment, product, service and labour markets, education and training, sustainable development, public health, education and the financial sector (Article 5). Specific emphasis is given to actions that foster the green and digital transitions.
The overall financial envelope for the implementation of the Instrument for the period 2021-2027 will be EUR 864 406 000 in current prices (Article 6). In addition to that financial envelope, Member States may transfer on voluntary basis, in accordance with Article 21 of Regulation [CPR successor] ] 11 , technical assistance resources under shared management programmes to the Technical Support Instrument. Transferred resources shall be implemented in accordance with the rules of this instrument and shall be used exclusively for the benefit of the Member State concerned (Article 6(3) and Article 10).
The Commission proposals for the 2021-2027 Multiannual Financial Framework set a more ambitious goal for climate mainstreaming across all EU programmes, with an overall target of 25% of EU expenditure contributing to climate objectives. The contribution of this instrument to the achievement of this overall target will be tracked through an EU climate marker system at an appropriate level of disaggregation, including the use of more precise methodologies where these are available (Recital 10).
The Technical Support Instrument should support the implementation of growth-sustaining and resilience-enhancing reforms undertaken at the initiative of the Member States, or in the context of economic governance processes, or actions related to the implementation of Union law and Union policy priorities and reforms in relation to the implementation of economic adjustment programmes. The instrument should also provide technical support for the preparation and implementation of reforms to be undertaken under the new Recovery and Resilience Facility (Article 8).
The Commission will analyse the requests for support on the basis of urgency, breadth and depth of the problems identified, support needs in respect of the policy area concerned, analysis of socioeconomic indicators and general administrative capacity of the Member State. Based on that analysis and taking into account the existing measures and actions financed by other Union funds or Union programmes, the Commission will come to an agreement with the Member State on the priority areas for support, the objectives, an indicative timeline, the scope of the support measures to be provided and the estimated global financial contribution, to be set out in a cooperation and support plan (Article 8).
The type of actions eligible for financing under the Technical Support Instrument will include, among others, expertise related to policy advice and/or change, formulation of strategies and reform roadmaps, as well as to legislative, institutional, structural and administrative reforms; the provision of experts, including resident experts; capacity building and related supporting actions at all governance levels, also contributing to the empowerment of civil society (Article 7). The actions financed under the Technical Suport Instrument may receive support from other Union programmes, instruments or funds under the Union's budget provided that such support does not cover the same cost (Article 11).
The Commission will adopt work programmes in order to implement the Technical Support Instrument, by way of implementing acts, setting out the measures for the provision of technical support and all the elements required under the Financial Regulation 12 (Article 12).
Provisions are made on communication activities vis-à-vis the European Parliament and the Council and vis-à-vis the general public (Articles 9 and 17), as well as provisions on complementarity (Article 13), monitoring (Article 14), annual reports (Article 15) and evaluation (Article 16).