Green light to prolong top-up in EU funding for projects in Greece and Cyprus
Plans to prolong a 10% increase in the EU contribution towards regional and social project costs in Greece until 30 June of the year after its economic adjustment programme ends were approved by Parliament on Tuesday. MEPs also approved a special provision whereby the EU would pay up to 85% of project costs in Cyprus until the current regional and social policy programming period ends in 2020.
“Today we have decided to continue helping Greece and Cyprus, which are the EU countries worst affected by budgetary difficulties, to make the most of the investment opportunities offered by the ESI funds in 2014-2020, by increasing the EU co-financing rates for interim payments. There is no impact on MFF annual ceilings for commitments and payments”, said rapporteur and Regional Development Committee chair Iskra Mihaylova (ALDE, BG). The legislative resolution was approved by 627 votes to 34, with 31 abstentions.
Prolonging top-ups for countries with an economic adjustment programme
“Top-ups” in EU contributions, on top of the EU’s usual “co-financing” share (EU member states themselves pay the rest) were first introduced in 2010. In the 2007-2013 funding period, eligibility for top-ups ended on the day when a member state stopped receiving financial assistance under the economic adjustment programme.
MEPs agreed that programme member states should continue to be eligible for top-ups until 30 June of the year following the calendar year in which they cease receiving financial assistance under an economic adjustment programme. Greece is the only EU country currently under a financial assistance programme, which is due to end in August 2018.
Cyprus - 85% co-financing rate until closure of the 2014-2020 programmes
MEPs voted in favour of extending the period of eligibility for Cyprus for the increased EU co-financing rate of 85% until the closure of the 2014-2020 regional and social programmes.
Cyprus has the status of a “more developed region” in the current EU cohesion (regional) policy and would normally receive 50% co-financing for projects under the European Regional Development Fund and European Social Fund programmes. But given that Cyprus has suffered economic hardship and declining investment over a long period, it was granted a higher co-financing rate of 85% between 1 January 2014 and 30 June 2017.
Next steps
The Council will now formally approve the amended regulation, which will enter into force on the day following its publication in the EU Official Journal.
Background
Article 24 of the Common Provisions Regulation allows the EU Commission to make increased payments under European Structural and Investment Fund (ESFI) programmes - so called “top-ups” - to countries experiencing economic difficulties. As their national budgets cannot cope with the required national co-financing of agreed projects, they run the risk of losing EU funds all together, at times when they need it most.
At a member state’s request, interim payments may be increased by 10 percentage points above the co-financing rate applicable to each priority for the European Regional Development Fund (ERDF), European Social Fund (ESF) and the Cohesion Fund or to each measure for the European Agricultural Fund for Rural Development (EAFRD) and the European Maritime and Fisheries Fund (EMFF).
These “top-ups” do not change the overall ESFI allocations in 2014-2020.
Contacts:
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Kristina-Antigoni ELEFTERIE
Press Officer