- We advise you to read the Explanatory Notes starting on page 10 before answering the questionnaire. - When completed, this form should be returned by 20 February 2009 via e-mail to [email protected] and [email protected]. - The questionnaire can be downloaded from the OECD website at http://www.oecd.org/dac/trade/aft or from the WTO Members' website at http://members.wto.org/members/. - All the boxes in this form are expandable.
1 IS YOUR TRADE STRATEGY MAINSTREAMED?
Q1.1 Does your country have a national development plan or strategy?
Yes No
If YES, does this development plan include trade as a lever for growth and poverty reduction? (please tick the most accurate description below)
Trade is a key priority and the plan includes well developed trade-related priorities and implementation actions (please attach).
Trade is mentioned but the plan does not include operational objectives and action plans.
No.
Other, please describe:CROATIAN EXPORT INITIATIVE (ONLY IN CROATIAN LANGUAGE), STRATEGIC DEVELOPMENT FRAMEWORK (ATTACHED).
If your Government does NOT have an articulated national development plan or strategy, or if trade is not strongly present in it, are there other separate strategies/plans addressing trade-related objectives? (feel free to tick more than one box)
Government priority areas are not systematically subject to a documented strategy.
In the annual government budget.
In various sectoral strategies (e.g. one per relevant ministry, or per sector). Please describe and attach:
In one single trade development/competitiveness strategy document encompassing all trade-related priorities across different government departments (please attach).
Other, please describe:
For Least-Developed Countries participating in the Enhanced Integrated Framework (EIF), former Integrated Framework (IF): Do the Diagnostic Trade Integration Study (DTIS) and Action Matrix reflect your Government trade strategy? (please tick the most accurate description below)
The DTIS and accompanying action matrix reflect well my country's trade-related needs and my Government's priorities.
The DTIS and accompanying action matrix partly reflect my Government's analysis of trade needs and priority areas.
The DTIS and accompanying action matrix are not (or are no longer) a good indication of my country's trade-related needs and priorities.
The DTIS and accompanying action matrix are not currently a good indication of my country's trade-related needs/priorities, but they are in the process of being updated.
Other, please describe:
Q1.2 What are your Government's priority areas of intervention to improve your country's capacity to benefit from trade expansion and integration into the world economy? (Below are listed the most common areas grouped according to broad aid category – please rank the top 3 priority areas among the 12 listed)
Trade Policy Analysis, Negotiation 2 Network infrastructure (power, and Implementation water, telecom) Trade Economic Policy and Infrastru- WTO Accession costs Other transport Regulations cture
Trade Facilitation Cross-border Infrastructure
1 Competitiveness Adjustment costs Building Productive Value Chains Other 3 Regional Integration Capacity Export Diversification Other, please describe:
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Q1.3 Does your Government have an operational strategy (with action plans, timelines and budgets) for its priority areas?
Priority 1: COMPETITIVENESS Yes Being formulated No
If Yes or Being formulated, please describe/ 1. EDUCATION SECTOR DEVELOPMENT PLAN 2005-2010 2. SCIENCE AND TECHNOLOGY POLICY OF THE REPUBLIC OF CROATIA 2006-2010 3. PRE-ACCESSION ECONOMIC PROGRAMME 2006-2008 4. ENTERPRISE SUPPORT PROGRAMME 2004-2008 5. PROGRAMME OF DEVELOPMENT OF ENTREPRENEURIAL ZONES 2004-2007 6. OPERATIONAL PROGRAMME FOR HUMAN RESOURCES DEVELOPMENT 2007-2009 7. CROATIAN EXPORT INITIATIVE
Priority 2: NETWORK INFRASTRUCTURE (POWER, WATER, TELECOM) Yes Being formulated No
If Yes or Being formulated, please describe: PROGRAMME FOR THE CONSTRUCTION AND MAINTENANCE OF PUBLIC ROADS FOR THE PERIOD OF 2005- 2008.
Priority 3: REGIONAL INTEGRATION Yes Being formulated No
If Yes or Being formulated, please describe NATIONAL STRATEGY FOR REGIONAL DEVELOPMENT; DRAFT
Q1.4 Are the financing needs of these trade-related priorities included in your national dialogue with donors?
Yes No Not sure
If YES, which structures do you use to discuss the financing needs of your trade-related priorities with your donors? (feel free to tick more than one box)
PRSP/CAS Bilateral Regional-wide Other, dialogues dialogues please describe:
Please describe the type of dialogue or alternative method, its level, its frequency, and its specificity to trade maTters:
If NO, do you have plans to include trade-related priorities in your dialogue with donors in the next two to three years?
Yes No Not sure
- End of Section 1 -
Please feel free to provide additional information about your trade strategy
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2 HOW IS YOUR TRADE STRATEGY FINANCED?
Q2.1 Does the attached CRS1 profile accurately quantify the Aid for Trade you received in 2006 and 2007?
Yes No Not sure/ NA
If NO, please provide details of the Aid for Trade you received in 2006 and 2007. [Please describe with figures, and include any activities that may fall under 'other trade-related needs']
SEE ATTACHED DOCUMENT
- End of Section 2 -
Please feel free to provide any additional information on aid-for-trade flows
1 The CRS profile summarises the commitments and disbursements reported by donors to the OECD Creditor Reporting System on the aid categories most closely associated with Aid for Trade as defined by the WTO Task Force, specifically support for trade policy and regulations, trade development, trade-related infrastructure, building productive capacity and trade-related adjustment (available from 2008 only).
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3 HOW DO YOU IMPLEMENT YOUR TRADE STRATEGY?
Ownership
Q3.1 Who is responsible for overseeing and coordinating the implementation of your trade strategies including activities funded by ODA?
A national committee is responsible for coordination and implementation.
The Trade Department has a coordinating role but implementation is overseen by each relevant department separately.
The national aid agency has the main coordinating role but implementation is overseen by each relevant department separately.
There is no central coordination department. Each relevant department is separately responsible for implementation.
Other, please describe:
If you have (or are in the process of establishing) a national committee, please describe its main functions, its membership (e.g. ministries, private sector), frequency of its meetings and to whom the committee reports. [Please describe and exemplify below.]
Q3.2 Do you engage in dialogue with the private sector and other key domestic stakeholders about the formulation and implementation of your trade strategy?
Nearly always Regularly Rarely Not sure/ NA
If you do, please describe your main stakeholders and the focus and frequency of your dialogue. [Please describe and exemplify below.]
NATIONAL COMPETITIVNESS COUNCIL, CENTRAL OFFICE FOR DEVELOPMENT STRATEGY AND COORDINATION OF EU FUNDS, CROATIAN EMPLOYERS' ASSOCIATION, CROATIAN CHAMBER OF ECONOMY, ASSOCIATION OF SMALL AND MEDIUM ENTERPRISES, TRADE UNIONS, ECONOMIC AND SOCIAL COUNCIL, CIVIL SOCIETY ASSOCIATIONS.
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For Least-Developed Countries participating in the Enhanced Integrated Framework (EIF):
Q3.3 Is your EIF focal point and committee responsible for overseeing and coordinating all your trade agenda?
Yes No Not sure/ NA
If no, please describe the different arrangements:
Working with external partners: harmonisation and alignment
Q3.4 In your Aid for Trade programs, how often do donors co-ordinate and align through:
Regularly Sometimes Rarely or Never Not Sure
Joint needs assessments
Co-financing
Sector-wide approaches
Joint Implementation
Joint Monitoring and Evaluation
Other, please describe:
Monitoring and evaluation
Q3.5 Do you monitor or evaluate your donor supported trade-related programmes?
Nearly always Regularly Rarely or Never Not Sure
If you monitor and evaluate your donor supported trade-related programmes, do you use:
Regularly Sometimes Rarely or Never Not Sure
Donors' monitoring and evaluation results
Joint monitoring and evaluation arrangements
Own monitoring and evaluation arrangements
Own monitoring but joint/donor evaluation
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If you use nearly always or frequently your own monitoring and/or evaluation arrangements, can you please provide examples of your methodology and results? [Please describe and exemplify below.]
Mutual Accountability
Q3.6 Have you established mechanisms/procedures to discuss with the relevant donors the outcome and impact of your trade-related programmes?
Yes No Not sure/ NA
If yes, please can you describe and exemplify them?
Priorities for improvement
Q3.7 What are your government’s priorities to improve the implementation and effectiveness of the aid for trade it receives? Please rank the top three in order of importance.
Greater say in the design of aid for trade interventions:
Stronger donor focus on capacity development:
Better predictability of aid for trade funding:
More extensive use of Budget Support (or Trade Sectoral Wide Approaches)
More regular joint-donor implementation actions
More harmonised reporting requirements
More frequent joint donor-partner implementation efforts
More systematic use of joint donor-partner monitoring and evaluation
Other, please describe:
Please, describe in detail the improvements needed in your top priority area
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Sharing Knowledge
Q3.8 Please identify and rank three areas of interventions (see Question 1.2 for a list of examples) where aid for trade has been most effective at raising trade capacity in your country. (Please explain your choice)
Area 1
Area 2
Area 3
Q3.9 Are there any particular examples of your aid-for-trade processes, programmes or projects that have obtained good results that you think could contribute to the development of good practices? [If so, please describe them below and attach any relevant documents.]
- End of Section 3 -
Please feel free to provide additional information on the implementation of your donor supported trade- related programmes and projects, i.e. aid for trade.
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4 ADDRESSING TRADE CAPACITY CONSTRAINTS AT THE REGIONAL LEVEL
Q4.1 Do your trade strategies specifically address regional trade capacity challenges?
Yes No Not sure/ NA
If YES, please describe them:
Q4.2 Do you participate in regional dialogues, programmes or activities aimed at promoting regional integration?
Yes No Not sure/ NA
If YES, can you tell us in how many of these you participate in and describe the most important ones to you? [Please describe below.]
Q4.3 Do you know if these regional dialogues, programs, and/or institutions receive aid for trade?
Yes, they do No, they don’t I don’t know/ NA
If YES, are you an active participant in the regional dialogues, programs and/or institutions?
Yes No Not sure/ NA
Q4.4 Do you participate in or benefit from aid-for-trade programmes implemented at the regional level?
Yes No Not sure/ NA
If YES, please describe the main benefits. [Please describe and quantify whenever possible.]
- End of Section 4 -
Please feel free to provide any additional information concerning the regional dimension of your trade strategies:
-- Thank you --
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COMMISSION DECISION
C(2007)2566 of 20/06/2007
on a Multi-annual Indicative Planning Document 2007 - 2009 for Croatia
THE COMMISSION OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Community,
Having regard to Council Regulation (EC) No 1085/2006 of 17 July 2006 establishing an Instrument for Pre-Accession Assistance (IPA)1, and in particular Article 14 (2)(a) thereof,
Whereas:
(1) Regulation (EC) No 1085/2006 creates a coherent framework for Community assistance for candidate countries and potential candidate countries. Article 6 (1) of that Regulation requires that the assistance shall be provided on the basis of multi-annual indicative planning documents established by country in close consultation with the national authorities.
(2) In accordance with Article 6 (2) of Regulation (EC) No 1085/2006, assistance for countries listed in Annex I to that Regulation shall be based on the Accession Partnerships and cover the priorities and overall strategy resulting from a regular analysis of the situation in the country and on which preparations for accession must concentrate.
(3) Croatia is listed in Annex I to Regulation (EC) No 1085/2006.
(4) The Council adopted on 20 February 2006 the Accession Partnership with Croatia2.
(5) This Decision is in accordance with the opinion of the IPA Committee set up under Article 14 of Regulation (EC) No 1085/2006,
1 OJ L 210, 31.7.2006, p. 82. 2 Council Decision 2006/145/EC of 20 February 2006 on the principles, priorities and conditions contained in the Accession Partnership with Croatia and repealing Decision 2004/648/EC (OJ L55, 25.2.2006, p. 30).
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HAS DECIDED AS FOLLOWS:
Sole article
The Multi-annual Indicative Planning Document (MIPD) for the years 2007-2009 for Croatia annexed to the present decision is hereby adopted.
Done at Brussels, […]
For the Commission […] Member of the Commission
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ANNEX
Multi-annual Indicative Planning Document (MIPD)
Republic of Croatia
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Preface The main objective of the Instrument for Pre-Accession Assistance (IPA)1 is to help the beneficiary country to implement the reforms needed to fulfil EU requirements and progress in the Stabilisation and Association Process and to lay the foundations for fulfilling the Copenhagen criteria for EU membership. The IPA instrument consists of five components: (IPA-I) the Transition Assistance and Institution Building component2; (IPA-II) the Cross-Border Cooperation component which applies to border regions between beneficiaries from member states, candidate states and countries in pre-accession status; (IPA III, IV and V) the Regional3, Human Resources4 and Rural Development5 components which are planned for Candidate Countries. The basic policy documents for setting down the priorities for programming of assistance under IPA are the Accession Partnership, the Strategy Paper, which presents the Commission’s overall enlargement policy, as well as the annual Progress Reports. IPA will allow flexibility in order to respond to possible new priorities identified in annual Progress Reports of the Commission.
This Multi-annual Indicative Planning Document (MIPD) is the strategic document for IPA. It is established for a three-year rolling period, with annual reviews. It follows the Multi-annual Indicative Financial Framework (MIFF) which indicatively allocates funds per beneficiary and per component. It draws on the pre-established IPA components. The priorities set out in the MIPD components will serve as a basis for the annual programming of EU funds in 2007, 2008 and 2009.
1 Council Regulation (EC) No 1085/2006 of 17 July 2006, Official Journal L210, page 82. 2 The Transition Assistance and Institution Building Component translates the priorities set out in the European Partnership in 3 sub-components: Political requirements where EC assistance will be used to support a stable, modern, democratic, multi- ethnic and open society based on the rule of law. Special impetus will be given to Public Administration and Judiciary Reform; Socio-economic requirements where EC assistance will be used in support of the development of the socio- economic environment; European standards where EC assistance will support and accompany the country in its European integration plan (legal approximation, administration needs and requirements for DIS). 3 The Regional development Component supports policy development as well as preparation for the implementation and management of the European Regional Development Fund and Cohesion Fund. 4 The Human Resources Development Component supports policy development and the preparation for the implementation and management of the European Social Fund. 5 The Rural Development Component supports policy development as well as the preparation for the implementation and management of the Community's common agricultural policy.
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Executive Summary The objective of the pre-accession assistance provided to Croatia under IPA is to assist in meeting the accession criteria, i.e. the political and economic criteria, as well as the adoption, implementation and enforcement of the acquis communautaire. In addition, IPA assistance aims to support policy development as well as preparation for the implementation of the Community's common agricultural policy and the cohesion policy with a view to EU membership. Pre-accession assistance for Croatia under IPA will be implemented according to the five IPA components available to Candidate Countries.
Under Component I, pre-accession assistance to Croatia will inter alia support public administration reform, judicial reform, and anti-corruption policy. Assistance will also focus on structural reforms in public finance, economic restructuring, business environment, statistics, land reform and labour market reform.
In addition, pre-accession assistance will support institutional capacity building for acquis transposition and implementation according to the priorities identified in the Accession Partnership, the screening reports and subsequent negotiations in the different chapters of the acquis. Finally, capacity building can also be provided for the management of IPA projects and to re-enforce institutional capacity for the management of EU structural funds. Croatia’s participation in Community Programmes will also continue to receive financial support under Component I.
Assistance to Cross-border Cooperation (CBC) provided under Component II aims at improving co-operation and good neighbourly relations of Croatian regions with the neighbouring border areas and familiarising Croatia with the rules and procedures governing the European Territorial Cooperation Objective under Structural Funds. The MIPD foresees continuing CBC with Slovenia, Hungary and Italy and developing bilateral CBC programmes with Bosnia and Herzegovina, Serbia and Montenegro.
Components III and IV aim at supporting Croatia in policy development as well as preparation for the implementation and management of the Community’s cohesion policy, in particular regarding the European Regional Development Fund, the Cohesion Fund and the European Social Fund. In terms of pre-accession assistance under Components III and IV, priorities comprise acquis-related investment in environmental protection and the development of a European transport network together with support to the productive sector, in particular to SMEs; Component IV priorities comprise investment in employment, education, social inclusion and human capital formation.
Component V aims at supporting Croatia in policy development as well as preparation for the implementation and management of the Community’s common agricultural policy. Assistance under Component V will target three main priority axes. The first will provide assistance to the adaptation of the agricultural sector and the implementation of the acquis communautaire concerning the common agricultural policy.. The second aims at preparing Croatia for the implementation of agri-environmental measures and the third at sustainable development of rural areas.
Coherence and concentration of assistance will be necessary for the effectiveness of IPA assistance under all components. Where appropriate effective coordination and complementarity with other IPA components will be assured.
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The present MIPD is based on an indicative financial envelope of €438.4 million for the period 2007-2009.
Section 1 Assessment of strategic priorities and objectives
1.1 Introduction
Following a positive assessment on 3 October 2005 from the International Criminal Tribunal for the former Yugoslavia (ICTY) Chief Prosecutor that full cooperation with the ICTY had been achieved, the European Council concluded on the same day that Croatia had met the outstanding condition for the start of accession negotiations and an Intergovernmental Conference (IGC) opening the negotiations was held.
The Commission started the screening process on 20 October 2005, through which the EU acquis is explained and the legal and administrative implications in Croatia are examined. Croatian legislation is compared in detail with EU legislation. The screening enables the EU to decide upon the opening of individual chapters for EU membership negotiations.
In February 2006, the Council adopted a revised Accession Partnership for Croatia. It covers in detail the priorities for accession preparations, including implementation of the acquis.
The European Commission assesses Croatia's progress in complying with the Copenhagen criteria and in addressing the priorities of the Accession Partnership through its annual progress reports. On 08 November 2006, the Commission published its Croatia 2006 Progress Report. The report takes into consideration progress achieved since the last Progress Report published on 06 November 2005 and covers the period to 30 September 2006.
Coherence of the present document with the beneficiary Country's own needs and priorities has been ensured through consultations with the national authorities, who agree on the priorities outlined in this MIPD.
1.2 Objectives of pre-accession assistance
The overall objective of pre-accession assistance is to help Croatia meet the accession criteria, i.e. the political and economic criteria as well as the adoption, implementation and enforcement of the acquis communautaire. In addition, IPA assistance aims to support policy development as well as preparation for the implementation of the Community's common agricultural policy and cohesion policy with a view to EU membership.
In order to define strategies that effectively contribute to the achievement of the overall objective, the MIPD is based on the assessment of needs and challenges as well as priorities identified in the Progress Report and Accession Partnership, taking into account past and ongoing EU assistance as well as the National Programme for the Integration of the Republic of Croatia into the European Union. It is clear from these documents and the needs assessment that Croatia has continued to make progress in terms of the political, economic and acquis criteria and implementation of its Stabilisation and Association Agreement. The main challenge for the period 2007 - 2009 will be to build on the progress made, and to accelerate the pace of reforms, notably in the key areas of judicial and public administration reform, the fight against corruption, economic reform and in relation to the accession negotiations.
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Croatia has improved its ability to take on the obligations of membership. In most areas, there has been progress, mainly in terms of legislative alignment. Implementing capacity has also been improved. However, in many cases enforcement is weak and administrative capacity remains uneven. Progress has varied considerably between different policy areas. Considerable efforts will be needed in a number of chapters such as free movement of capital, competition policy, public procurement, agriculture, justice freedom and security, judiciary and fundamental rights and environment.
Initially the screening process, through its identification of gaps between Croatian legislation and the acquis communautaire, and subsequently the negotiation of specific chapters, will help the programming of pre-accession assistance. The focus will be on politically and legislative complex sectors with weaknesses in implementation capacity and costly investments.
Croatia needs to promote employment and raise living standards while strengthening macroeconomic stability and furthering structural and other necessary reforms. EU assistance will focus on investments and collective services which are required to increase long-term competitiveness, job creation and sustainable development, namely acquis-related investments in environmental protection (waste water, drinking water and waste management) and sustainable transport (railways and inland waterways). Along with these efforts directed at basic infrastructure, further assistance will be aimed at modernising and restructuring the productive capacity of disadvantaged regions in particular by providing services to enterprises, particularly small and medium sized enterprises (SMEs). Finally, investments will be made available for education, social cohesion and human capital formation to address among others low employment rates and high unemployment, increase the share of high skilled workers, and better target social benefits to reach the most vulnerable groups.
Agriculture still plays an important role in the overall economy of Croatia. Family farms possess the majority of arable land and livestock. The productivity is still low and characterised by small-scale production, outdated production methods and equipment. The divergence of living standards between rural and urban areas is significant in terms of income, education, physical, social and cultural infrastructure and unemployment with a high number of (semi) subsistence agriculture, insufficient diversification of income generating activities and ageing population in rural areas. EU assistance in this sector aims at preparing the Croatian agriculture and agri-food sectors to meet EU requirements through targeted investments and improving the respect of Community standard for food safety, veterinary, phytosanitary, environmental and other standards as well as helping Croatia to get ready for the implementation of EU rural development programmes.
To summarize, pre-accession assistance shall help Croatia to meet the EU accession criteria. Against this background, pre-accession assistance shall help to overcome the deficiencies that have been identified. Assistance to Croatia will focus on: • implementing sectoral reforms, in particular through support to public administration reform, the judicial reform and fight against corruption; • supporting structural reforms and economic development, particular in public finance, economic restructuring, and improving the business environment, especially as regards the SME sector; • transposing and implementing the acquis according to the priorities identified in the Accession partnership, the screening reports and subsequent negotiations in different chapters;
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• preparing Croatia for the implementation of the Community’s cohesion policy, in particular by focusing in the field of transport, environment and regional competitiveness as well as education, employment, social inclusion and human capital formation; • preparing Croatia for the implementation of the Community’s rural development policy, in particular by focusing on investments in agricultural production to restructure and upgrade the sector to Community standards and on investments to develop and diversify economic activities in rural areas.
In addition to the above objectives of pre-accession assistance, certain cross cutting issues, which are outlined in annex A, will have to be reflected in all activities programmed under IPA.
1.3 Overview of past and on-going pre-accession assistance
1.3.1 Past and On-going Assistance
IPA assistance will build on assistance provided to Croatia under the CARDS programme (2001-2004) and the pre-accession instruments Phare, ISPA (2005-2006) and Sapard (2006). Croatia also participates in and benefits from Phare-funded multi-country and horizontal programmes such as TAIEX, the Small and Medium-sized Enterprises Financing Facility, and the Nuclear Safety Programme. Croatia also remained a beneficiary of the CARDS Regional Programme in 2005 and 2006.
Community assistance to Croatia during the period 1991 – 1999 developed from humanitarian assistance to reconstruction and reconciliation efforts and support for refugee return. The EU consolidated its assistance in 2000 under CARDS, in line with the recently launched Stabilisation and Association Process. Due to the development of the relations between the Republic of Croatia and the EU since 2000, CARDS assistance increasingly focussed on institution and administrative capacity building and legislative alignment with the acquis communautaire. Since becoming a candidate country in 2004, Croatia has stood to benefit from all three pre-accession financial instruments: Phare for institution-building and economic and social cohesion, ISPA for environment and transport infrastructures and Sapard for agricultural and rural development. Assistance under IPA will make use of the institutions and the sectoral strategies that have been developed and supported under the preceding programmes.
The Tempus programme has provided considerable support to the modernisation and the reform of the higher education system in Croatia. Since 2000, Tempus has funded over 50 cooperation projects with EU higher education institutions in the areas of curriculum development, university management and structural reform.
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In the framework of the CARDS National Programmes, the total financial allocation for the period 2001 to 2004 amounted to €260 million for the following five main priorities:
Table 1: CARDS allocations 2001 – 2004 in the Republic of Croatia in million €
Sector 2001 2002 2003 2004 Total
Democratic Stabilisation 24.2 16 16 17.5 73.7
Economic & social development 15.6 18 16.9 17.75 68.25
Justice and home affairs 14.1 10 10.9 26.85 61.85
Administrative Capacity Building 2.1 12 11.65 15.1 40.85
Environment and natural resources 2 3 6.55 3.8 15.35
Total allocation 58 59 62 81 260
The pre-accession financial instruments Phare, Phare CBC, ISPA and Sapard replaced the CARDS instrument for the period 2005 and 2006 with a total financial allocation of €229.6 million. Phare essentially continued the institution building efforts begun under CARDS with the additional element of Phare Economic and Social Cohesion allowing for limited investments. Cross-border cooperation had previously been financed under the regional CARDS budget, with Phare CBC taking over and continuing to finance Croatian participation in neighbourhood programmes. Both ISPA, with its focus on transport and environmental infrastructure and Sapard for rural development introduced new elements of pre-accession assistance to Croatia by financing actions and investments that could previously not be addressed under CARDS.
Table 2: Phare, ISPA and Sapard allocations 2005 – 2006 in the Republic of Croatia in million €
Sector 2005 2006 Total
Phare 71.5 61.1 132.6
Phare CBC 6 6 12
ISPA 25 35 60
Sapard ~ 25 25
Total allocation 102.5 127.1 229.6
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The following table provides an overview of the combined CARDS and Phare resources provided to Croatia in the period 2001 to 2006.
Table 3: Total CARDS and Phare allocations 2001 – 2006 in the Republic of Croatia in million €
Sector CARDS Phare Total
Political Criteria 44.4 15.6 59.95
Economic Criteria 34.3 8.24 42.49
Ability to Assume the 107 77.47 184.47 Obligations of Membership
Supporting Programmes 8.2 24.26 32.46
Economic and Social Cohesion 66.2 7 73.2
Total allocation 262 132.6 392.6
Under the sector political criteria, CARDS assistance contributed to strengthening the judiciary capacities and structures through projects focused on training systems development, courts system operations and functioning. Public administration and civil service reform were addressed leading to a new Civil Service law. Concerning human rights, protection of minorities and civil society dialogue, CARDS assistance facilitated the return of refugees and displaced persons with particular emphasis on sustainable regional development in return areas, the reconstruction of houses, public and social infrastructure, demining6 as well as civil society development. Phare projects continue to provide important assistance for the modernisation of justice system, public administration reform, the protection of minorities, in particular the Roma, and civil society development.
In the sector economic criteria, CARDS assistance for capacity building in key institutions has helped the investment climate to improve with particular emphasis on assistance with land cadastre and property registration reform, the reform of the regulatory framework for business investments, competition policy, public procurement and intellectual property rights. Good results were also reached in the reform of the public finance system, focusing on internal audit and financial control, external budget oversight, public debt management capacity, customs systems and procedures and public finance statistics. Phare provides further assistance to the improvement of the investment climate with a project for the modernisation of the land administration and the reform of public finances by improving the budget process for effective financial management.
Assistance under the sector ability to assume the obligation of membership absorbed the largest part of the available budget allocation for Croatia, reflecting the candidate status for EU membership of the country. CARDS assistance contributed to an improvement of trade, with actions supporting the introduction of EU industrial standards, the development of accreditation systems, food safety, veterinary and phyto-sanitary standards, consumer
6 Besides CARDS assistance, support in the field of demining has been provided also through the horizontal budget line 'Action against Anti-Personnel Landmines'.
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protection and statistics. Social cohesion was supported through assistance to vocational training, labour market and higher education reform efforts. Assistance to cooperation in justice and home affairs provided important improvements to integrated border management focussing on customs and border policing, inter-agency cooperation and asylum policy and migration as well as policing and the fight against organised crime including trafficking in Firearms, Ammunitions and Explosives. CARDS assistance in the field of environment has resulted in further legislative alignment in the waste and water management area, environmental impact assessment and monitoring, advocacy, awareness raising and the promotion of renewable energy sources as well as investment preparations. Projects under Phare continue to address the areas of trade, customs and taxation, agriculture and fisheries, transport, social cohesion, statistics, environment and natural resources, policing and the fight against corruption and organised crime as well as border management.
The ISPA programme contributed to environmental and transport acquis related infrastructure investments.
The Sapard programme started in 2006. The programme, as well as the Sapard agency constitute the basis for the development of the IPARD programme and agency.
Under the sector supporting programmes, Phare provides assistance to national, regional and local development capacity building, the participation of Croatia in community programmes including TEMPUS and also includes a project preparation and institution building reserve, a continuation of the administrative capacity building facilities introduced under CARDS.
Finally, economic and social cohesion continues to support the sustainable regional development in return areas begun under the CARDS programme by providing grant schemes for business related infrastructure, SMEs as well as promoting active labour market measures for those threatened with social exclusion. Over time, EU assistance to the refugee return process changed successfully from housing reconstruction to social-economic development of return areas. Assistance has thus contributed to enhancing regional competitiveness, with a major emphasis on strengthening the institutional framework and building administrative capacity in the area of economic and social development.
The key lessons learned from the implementation of CARDS and pre-accession instruments assistance projects in Croatia are (a) that weak administrative absorption capacity in Croatia’s public administration bodies is reducing the effectiveness of EC assistance and (b) that greater political support is needed. The Croatian administration needs to keep up its efforts to meet agreed project conditionalities, such as policy decisions; the establishment and strengthening of institutions and the allocation of resources. Proper staffing of the units charged with implementing projects and support from the top management and political level in ministries is necessary for successful project results. The Commission continues to support Institution building in bodies involved in managing EU funds and it also supports general public administration reform.
The Croatian government has undertaken a series of activities to improve the implementation record of EU assistance with good results. The screening process has also raised the awareness of the political level of the importance of EU assistance projects. Many reforms already undertaken to comply with the EU acquis are a direct result of CARDS assistance. A government Coordination Group and a Technical Working Group are facilitating the coordination of EC assistance received by Croatia.
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1.3.2 Relevant IFI and Bilateral Assistance
The Commission is working with the World Bank and other international financing institutions, in particular the EBRD and EIB, to ensure proper co-ordination of external assistance programmes and, in some cases, co-financing of projects. A Commission-EU Member States co-ordination mechanism on assistance has been in place locally since 2001. The co-ordination mechanism has improved the impact and coherence of EC assistance and member states’ bilateral aid. The EU Accession process has increasingly shaped the agenda for other donors' interventions in Croatia.
In March 2006, the International Monetary Fund extended its precautionary Stand-by Agreement with Croatia until November 2006 for a total of €99 million.
The World Bank adopted a Country Assistance Strategy for Croatia for 2005 - 2008 in December 2004. The four-year program focuses on the reforms required for Croatia's EU accession in the sectors of public administration reform, judiciary reform, agriculture, transport, public budget management, private sector development, education, health care and social security, wastewater and water supply infrastructure and improved energy efficiency. Since 1993, the World Bank has approved 48 grants with a total value over €40 million and provided credits for 31 projects with a total value of €1.3 billion.
The European Investment Bank finances projects that support the rapid integration of Croatia into the EU. It has been active in Croatia since 2001. Most lending has focused on the construction and rehabilitation of transport infrastructure (€545 million). To date the EIB has also provided four Global Loans (€76 million) in the country, aimed at the financings of SMEs and municipalities. The transport infrastructure sector will remain a priority. The EIB also envisages more loans in both the environmental and the health sector.
The European Bank for Reconstruction and Development has signed 57 investments in Croatia totalling almost €1.3 billion as of 31 December 2005. Projects for 2006 and beyond include a number of infrastructure operations currently under preparation, which are co- financed by EU pre-accession instruments.
In addition to support from the IFIs, EU Member States and other donors are actively supporting Croatia's accession process.
Section 2 Pre-Accession assistance strategy for the period 2007-2009 2.1 Strategic Choices In view of the accession process with Croatia, the objective of pre-accession assistance is to support the country's efforts to comply with the accession criteria, i.e. the political and economic criteria, as well as the adoption, implementation and enforcement of the acquis communautaire. In addition, IPA assistance aims to support policy development as well as preparation for the implementation of the Community's common agricultural policy and the cohesion policy with a view to EU membership.
Based on the assessment of strategic needs and priorities set out in the Accession Partnership and the Progress Reports for Croatia, the pre-accession assistance strategy for the period 2007-2009 is concentrated on three areas of activity: 1. Institutional Capacity Building 2. Cross-border cooperation
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3. Preparation for participation in the Community's cohesion policy and rural development instruments
In translating the objectives set out in Section 1.2. into specific priorities for assistance to Croatia, a number of elements needs to be taken into consideration. These include, among other things, sequencing between the different EU assistance programmes available for implementation in Croatia, programme maturity, the absorption capacity of Croatian beneficiary institutions, the availability of funds and alternative sources of financing, and the synergies that may be developed with the activities of other donors. For example, in the area of transport, and based on the Croatian maritime safety strategy, two Phare programmes are under implementation to improve maritime safety and vessels monitoring. A follow-up project may be programmed under IPA taking into account the implementation period of the previous projects, the capacity of the Ministry of Transport to manage the projects, the involvement of the World Bank in the sector and the activities to be financed in the transport sector under Component III. In many cases, these issues can only be assessed at the annual programming stage. Nevertheless, some general strategic choices can already be identified in this document. The assistance provided in the areas of intervention identified below will respond to reforms being undertaken by Croatia as a Candidate Country negotiating accession to the EU.
Croatia is a beneficiary of IPA multi-country programmes and, where this is justified by economies of scale, interventions will be planned under the corresponding multi-country MIPD.
Based on the above, and on the lessons learned from previous and on-going assistance, pre- accession assistance for Croatia under the five IPA components will concentrate on the following strategic orientations:
The Transition Assistance and Institution Building Component will be the main vehicle for institutional capacity building in Croatia. In the planning period 2007-2009 IPA assistance under this component will focus on two broad areas of intervention: (i) implementation of sectoral reforms and (ii) acquis transposition and implementation.
(i) Assistance will be provided to consolidate sectoral reforms that have adopted such as public administration reform, judicial reform, and anti-corruption policy and to ensure their effective implementation. Assistance will also focus on structural reforms in public finance, economic restructuring, business environment with a particular focus on SME's, agricultural and economic statistics and labour market reform. Priority will be given to supporting the institutions that are directly concerned by the reforms.
(ii) Pre-accession assistance will support institutional capacity building for acquis transposition and implementation according to the priorities identified in the Accession Partnership, the screening reports and subsequent negotiations in the different chapters of the acquis. Assistance in the 2007 – 2009 period will give priority to sectors: (1) where basic political issues still need to be addressed; (2) where the legislation to be harmonised is particularly difficult; (3) where the implementation capacity is particularly weak; (4) where a track record of implementation will be required prior to accession; and (5) where harmonisation requires costly investment over several years. Finally, capacity building can also be provided for the management of IPA projects and to re- enforce institutional capacity for the management of EU structural funds. Croatia’s
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participation in Community Programmes will also continue to receive financial support under Component I. Cross-Border Cooperation, managed through Component II, will support Croatia in cross- border, and trans-national and interregional cooperation with EU and non-EU Member States. It will concentrate on improving the potentials for tourism, creating closer links between border regions and supporting joint environmental protection activities. Furthermore, through participation in the ERDF cross-border, transnational and interregional programmes, pre- accession assistance is aimed at familiarising Croatian participants with the rules and procedures governing the European Territorial Cooperation Objective under Structural Funds. Pre-accession assistance will help prepare Croatia for participation in the Community's cohesion policy and rural development instruments on accession through IPA components III, IV and V. The Regional Development and Human Resources Development Components will support Croatia in policy development and preparation for the implementation and management of the Community’s cohesion policy, in particular regarding the European Regional Development Fund, the Cohesion Fund and the European Social Fund. Priorities comprise acquis-related investment in environmental protection and European transport networks together with support to the productive sector, in particular to SMEs in disadvantaged regions, employment, education, social inclusion and to human capital formation.
The Rural Development Component will support Croatia in policy development and preparation for the implementation and management of the Community’s Common Agricultural Policy. Assistance under Component V will provide assistance to the adaptation of the agricultural sector and the implementation of the acquis communautaire concerning the common agricultural policy and related policy areas like food safety, veterinary, phytosanitary and environmental matters as well as sustainable development of rural areas.
The actions to be undertaken under the five components will be closely coordinated and will be complementary to the degree possible. Institution building measures under Component I can in this regard be made available to support the implementation and results to be achieved under the four other components. Close coordination and complementarity will also be sought with other donors. Coherence and concentration of assistance will be necessary for the effectiveness of IPA assistance under all components. Where appropriate, effective coordination and complementarity between the IPA components (as well as with IFI interventions) will be assured.
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2.2 Multi-annual planning by component As outlined in the MIFF, the nominal allocations for each component of the pre-accession assistance strategy for Croatia 2007 – 2009 in current prices are as follows:
Table 4: Republic of Croatia: Multi-Annual Indicative Financial Framework in million € Component 2007 2008 2009 Total I – Transition Assistance and 49.6 45.4 45.6 140.6 Institution Building II – Cross-border cooperation 9.7 14.7 15.9 40.3 III – Regional Development 45.1 47.6 49.7 142.4 IV – Human Resources Development 11.4 12.7 14.2 38.3 V – Rural Development 25.5 25.6 25.8 76.9 Total 141.2 146 151.2 438.4
The strategic programming for each component is presented in the following sections.
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Component I – Transition Assistance and Institution Building 1. Current situation
The Progress Report 2006 for Croatia highlighted that with regard to the political criteria, Croatia continues to face no major difficulties. Croatia has made progress overall but further sustained efforts are required in a number of important areas.
As regards the economic criteria for membership, Croatia can be regarded as a functioning market economy and it should be able to cope with the competitive pressure and market force within the Union in the medium term, provided that it continues implementing its reform programme to remove the remaining weaknesses.
As regards Croatia’s ability to assume the obligations of membership, Croatia has made some progress, mainly in terms of legislative alignment with the acquis. Progress has varied considerably between chapters. As regards implementing capacity, in many cases enforcement is weak and administrative capacity remains uneven. Croatia will need to adopt a more strategic approach to acquis alignment and to develop, where appropriate, comprehensive strategies, which should include all reforms necessary in terms of legislative alignment and institutional capacity-building in order to implement and comply with the relevant acquis.
2. Major areas of intervention
In view of the accession process with Croatia, the objective of pre-accession assistance is to support the country's efforts to comply with the accession criteria. Component I's major task is to provide for the Institution Building needed to meet this objective. Against this background, the main areas of intervention for Component I in the period 2007 – 2009 are: • Political criteria • Economic criteria • Ability to assume the obligations of membership • Supporting programmes
3. Main priorities
EU financial assistance will support Croatia's efforts to address the priorities identified in the Accession Partnership, the screening reports and subsequent negotiations in the different chapters of the acquis. Building on past and ongoing pre-accession assistance, the main objectives of IPA assistance under Component I in the major areas of intervention can be specified as follows:
Political criteria
Assistance in this area will indicatively focus on support to public administration reform, the judiciary, and in the fight against corruption. It will also support minorities and civil society. Significant improvements in these areas are indispensable as a solid basis for full implementation of the acquis.
Support will focus on the implementation of a comprehensive strategic framework for public administration reform with a focus on simplifying the existing legal administrative system and improving the efficiency and professionalism of the public administration. The
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Government adopted a policy paper in September 2006 committing it to drafting a revised General Administrative Procedure Act by July 2007. Support will also continue for the implementation of the new civil service law that entered into force in January 2006.
Support to the implementation of the judicial reform strategy will continue with particular emphasis on reducing the length of court proceedings, improving case management, rationalising the court network and ensuring proper enforcement of judgements. Support will also be provided to improve the procedures for the training of judicial officials. The areas of prosecution of war crimes and witness protection are also priorities for EU assistance.
A new anti-corruption programme was adopted in March 2006. Support to strengthen the Office for the Prevention of Corruption and Organised Crime (USKOK) and other bodies involved in the implementation of the anti-corruption programme will continue to be provided with particular emphasis on improving the coordination among them.
In the area of human rights and the protection of minorities an appropriate legal framework is in place. Support will be provided to accelerate the implementation of legislation, to combat intolerance and to encourage reconciliation. Support can also be made available for the implementation of the Constitutional Law on National Minorities and for developing and implementing a comprehensive strategy and action plan on all forms of discrimination as well as assisting in the implementation of plans for improving women’s and children’s rights. A main vehicle for support in the above mentioned areas will be civil society development and dialogue.
EU assistance will also continue to assist Croatia in creating the economic and social conditions necessary for the sustainability of refugee return. Economic Criteria While Croatia can be regarded as a functioning market economy and should be able to cope with competitive pressures and market forces within the Union in the medium term, weaknesses remain, mainly with regards to the strengthening of the development of the private sector. EU assistance in this area will aim to improve competitiveness and the business environment, as well as the functioning of market entry and exit procedures and the enforcement of property and creditor rights. Further focus of assistance will indicatively include the areas of structural reforms in public finance, economic restructuring, statistics, land reform and labour market reform.
Ability to assume the obligations of membership
Croatia has improved its ability to take on the obligations of membership. In most areas there has been some progress, mainly in terms of legislative alignment. Progress has varied considerably between chapters. As regards the overall level of alignment and administrative capacity, much remains to be done. The focus of assistance in this area will be on institutional and administrative capacity building for acquis transposition and implementation according to the priorities identified in the Accession Partnership, the screening process and subsequent
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negotiations in the different chapters of the acquis.7 Assistance will also be provided for the implementation of agreements in the transport and energy sectors.
Supporting programmes
Supporting programmes under IPA Component I will continue to provide for administrative capacity building for strategy development, project preparation and implementation, institution building support and SAA and acquis implementation. Capacity building may also be provided for the management of IPA projects and to reinforce institutional capacity for the management of EU structural funds. Croatia’s participation in Community Programmes8 will also continue to receive financial support under IPA.
4. Expected results
The expected results to be obtained will be laid down in detail in the respective annual programmes. In more general terms, the expected results of pre-accession assistance provided under Component I are: • Significant progress to have been made in public administration reform, judicial reform, anti-corruption policy, human rights, protection of minorities and civil society development and dialogue; • Significant progress to have been made in structural reforms in public finance, economic restructuring, investment promotion, agricultural and economic statistics and labour market reform; • Improvement of business environment and implementation of European Charter for Small Enterprises; • Institutional capacity building for acquis transposition to have been strengthened; • Priorities identified in the Accession Partnership, the screening reports and subsequent negotiations in the different chapters of the acquis to have been addressed; • Legislation on aviation and the internal energy market to have been aligned to the EU acquis, and the ECAA and Energy Community agreements to have been implemented as appropriate; • International agreements to have been implemented; • Sufficient administrative capacity for strategy development, project preparation and implementation to have been built up; • The management of IPA projects and institutional capacity for the management of EU structural funds to have been strengthened.
The principle means for assessing the achievement of expected results are the annual progress reports.9
7 Support to nuclear safety and radio-active waste management will be foreseen within this MIPD. However, due to the need to develop harmonised approaches it will be programmed under the Multi Beneficiary IPA programme where it will be described in more detail. 8 Contributions are foreseen within this programme for the participation in the Tempus and Erasmus Mundus Programmes, when relevant. Due to economies of scale it will be programmed under the Multi Beneficiary IPA programme where it will be described in more detail. 9 Monitoring arrangements are further detailed in the IPA Implementing Regulation.
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5. Forms of assistance to be provided
EU pre-accession assistance under Component I will be provided in form of annual programmes. Each year, the Commission will prepare a Financing Proposal based on project proposals submitted by the Croatian authorities leading to a Commission Decision and the signature of an annual Financing Agreement with Croatia.
Financial support will continue to be provided in principle through services, in particular through technical assistance, either via service contracts, grant agreements, Twinning or a small-scale framework facility, as applicable. Where appropriate, this will be supplemented by supplies, works or other action necessary for the provision of equipped operational facilities.
6. Financial indications
Table 5: Financial indications – Component I Political criteria 10 – 20 % Economic criteria 05 - 15 % Ability to assume the obligations of membership 50 – 70 % Supporting programmes 10 – 20 %
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Component II – Cross Border Co–operation 1. Current situation
Croatia currently participates in cross-border co-operation programmes with the EU Member States Italy, Slovenia and Hungary as well as in the transnational CADSES programme. Funds for cross-border co-operation activities and capacity building for participation in CBC programmes have been made available both from the national and regional CARDS programmes and under the Phare 2005 and 2006 programmes. While CBC with EU Member States is well advanced, co-operation programmes with potential candidate countries still need to be developed. Assistance for the necessary programming, planning and institution building for CBC with Bosnia and Herzegovina, Serbia and Montenegro is currently being provided from CARDS national and regional funds.
2. Major areas of intervention
IPA Component II will provide assistance for implementing cross-border co-operation programmes at the borders of Croatia with EU Member States and potential candidate countries as well as for Croatia’s participation in ERDF trans-national and interregional programmes.
CBC with EU Member States
CBC with Member States will include Croatia's participation in the IPA CBC "Adriatic" programme – which will include the coastal areas of Italy, Slovenia and Greece and those of Candidate/potential Candidate countries along the Adriatic – and in IPA CBC programmes at land borders with Slovenia and with Hungary. At borders with the EU, IPA CBC should operate on both sides of the border on the basis of one set of rules, under a single management structure, for the purpose of financing genuinely joint projects for the common benefit of the two parties. Eligible regions along the borders are as follows:
Table 6: Eligible Croatian regions at NUTS III level for CBC with EU Member States CBC programme Eligible Croatian regions Slovenia - Croatia Primorje-Gorski Kotar; Karlovac; Zagreb County; Krapina-Zagorje Hungary - Croatia Međimurje; Koprivnica-Križevci; Virovitica-Podravina; Osijek-Baranja IPA Adriatic– CBC Istria, Primorje-Gorski Kotar; Lika-Senj; Zadar; Šibenik-Knin; Split Dalmatia; Dubrovnik-Neretva Regions adjacent to these regions may participate in the relevant programme and may receive up to 20% of the programme funding. Such adjacent regions must be agreed by all participating countries and by the Commission.
CBC with potential candidate countries
CBC with adjacent potential candidate countries will include Croatia's participating in programmes with Bosnia and Herzegovina, Serbia and Montenegro. The list of eligible areas, selected according to the IPA eligibility rules (at NUTS III level or, in the absence of NUTS classification, equivalent areas), will be established in the relevant IPA CBC programmes.
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Participation in ERDF trans-national and interregional programmes
In addition, building on the experience gained in the context of the CADSES programme, IPA Component II funds are available to support, as appropriate, the participation in the relevant Structural Funds trans-national programmes (and, as appropriate, interregional programmes) where Croatia is eligible.
3. Main priorities
The main priorities supported under this Component will indicatively include: • Co-operation among local/ regional authorities, associations, NGOs and enterprises from neighbouring regions to enhance economic and social development of eligible border regions; • Small infrastructure to improve potential for tourism or local/ regional transport and communication, including environmental aspects; • People-to-people actions to intensify contacts at local level among citizens from either side of the borders; • Technical Assistance and information diffusion to help with programme implementation and contribute to timely delivery of results; • Cooperation between authorities covering strategies and actions to address risks and threats to border security and organised crime.
4. Expected results
The expected results to be obtained will be laid down in detail in the respective multi-annual programmes. In more general terms, the expected results of pre-accession assistance provided under Component II is an improvement in the co-operation and good neighbourly relations of Croatian regions with the neighbouring border areas and an increased sustainable economic and social development in border areas and across the border regions.
The principle means for assessing the achievement of expected results are the annual progress reports10.
5. Forms of assistance to be provided
EU pre-accession assistance under Component II will be provided in form of multi-annual programmes. In principle, joint programming documents covering a period of three years will be adopted for each CBC programme through a Commission decision and annual or multi–annual Financing Agreement will be concluded between the Commission and the Croatian authorities to implement the joint programming documents.
The identification of suitable joint projects should primarily take place through competitive joint call for proposals agreed between participating countries. Pre-identification of projects with a genuine cross-border value by the CBC Joint Monitoring Committee are also possible. In the case of ERDF trans-national and interregional programmes, the participation of the country will follow the implementing rules of those programmes.
10 Monitoring arrangements are further detailed in the IPA Implementing Regulation.
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6. Financial indications
Within the IPA component II funds, the following indicative amounts are earmarked for CBC with EU Member States, for CBC programmes between Croatia and the adjacent potential candidate countries and for the possible participation of Croatia in the relevant ERDF trans- national and interregional programmes:
Table 7: Financial indications – Component II CBC programme IPA IPA funds IPA funds Total % funds 2008 2009 2007 Croatia – Slovenia 1.721 2.940 3.207 7.868 19.5% Croatia – Hungary 1.405 2.400 2.618 6.423 15.9% IPA Adriatic CBC 3.922 6.698 7.306 17.926 44.4% Croatia – potential Candidate 2.653 2.706 2.760 8.119 20.1% Countries and ERDF transnational and interregional programmes Total 9.701 14.744 15.891 40.336 100%
(million €, current prices)
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Components III and IV – Coherence and Concentration
1. Introduction
As the pre-cursor to the next-generation of Structural and Cohesion Funds, the strategic dimension and thematic focus of pre-accession assistance under components III and IV will essentially be governed by the cohesion policy priorities established under the Community Strategic Guidelines 2007-2013. In effect, these guidelines identify those areas where cohesion policy can most effectively contribute to the realisation of Community priorities, in particular insofar as they relate to the renewed Lisbon strategy as defined under the Integrated Guidelines for Growth and Jobs.
Moreover, under the Convergence objective, which addresses cohesion policy priorities in the least-favoured areas of the Union, the priorities encompass the provision of basic infrastructure, the promotion of productive investments as well as investment in human capital.
In the context of the overall planning and policy framework governing components III and IV, the strategic priorities should be consistent with EU-accession-driven objectives and priorities as identified under the Accession Partnership.
Within this perspective, the key policy objectives of Components III and IV will be to stimulate growth potential through efforts directed towards investment and collective services as well as in support of job creation and sustainable development. At the same time, the strengthening of institutional capacity and efficiency will be a key related objective, in particular as Component IV is concerned. In accordance with the principle of learning by doing, implementing both components will also familiarise Croatia with the rules and procedures governing the future Structural and Cohesion Funds.
In order to provide a strategic frame of reference within which the respective Component III and IV interventions will be delivered, a Strategic Coherence Framework (SCF) will be prepared and elaborated by the relevant Croatian authorities.
Within the SCF framework, the supporting analysis and subsequent strategy setting will cover the 2007-2013 period and will identify the key objectives and priorities to be implemented through the mechanism of multi-annual Operational Programmes with a strong strategic focus. In duly justified cases, these programmes may be subsequently updated in the light of possible amendments to national and/or EU priorities or in the case of a substantial revision of the available financial resources provided under the MIFF.
Within a wider SCF future-setting context, the identification of investment-related challenges covering a range of sectoral, thematic and geographical priorities across components III and IV will provide an important platform to delivering a coherent strategy in preparation for the subsequent roll-out of Structural and Cohesion Funds post accession.
2. Coherence and concentration of assistance
As fundamental principles of cohesion policy, both coherence and concentration of assistance are considered necessary pre-requisites to optimising the effectiveness of the supported interventions under components III and IV.
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At the same time, complementarity and consistency across the interventions under both components, including the thematic and geographical concentration of the assistance on a limited number of strategic priorities, will be geared towards maximising the development impact of the IPA intervention as a whole. In this respect, considerations of value-added will assume a strong focus as will the multiplier effect of the operations undertaken.
At the same time, effective coordination and complementarity with other IPA components (as well as with IFI interventions) will be assured.
Given the relative limitations on the volumes of assistance available in respect of components III and IV, the focus will build on a twin-track approach. In particular, the investment strategy will, on the one hand, provide a platform towards further development and roll-out under the future Structural and Cohesion Funds post accession, while on the other hand strengthening institutional and administrative capacity, where appropriate.
3. Guiding principles of cohesion policy (2007-2013) in programming components III and IV
In meeting the Article 158 Treaty objective of promoting economic and social cohesion by reducing disparities between the levels of development of the various regions as well as the backwardness of the least favoured regions, actions supported within the limited resources available under components III and IV will be concentrated on promoting sustainable growth, competitiveness and employment as set out in the renewed Lisbon strategy.
While macroeconomic stability and structural reforms represent necessary pre-conditions for the success of cohesion policy, a further set of conditions must also be addressed if a favourable investment climate is to be created in Croatia. In particular, administrative reform and good governance are deemed crucial as well as the creation of a business-friendly climate and the availability of a highly-skilled workforce.
Under the Community Strategic Guidelines 2007-2013, the creation of a new framework represents an important new element whereby the strategic dimension of cohesion policy has been strengthened in order to ensure that Community priorities are better integrated into national, regional and local development programmes.
Regarding the priorities under the Convergence objective in particular, basic infrastructures and services will need to be created, upgraded and expanded in order to open up regional and local economies, set up an effective business support framework and exploit the opportunities afforded by the Single Market. Moreover, efforts are also required to expand investment in human capital, increase access to employment, strengthen social inclusion and accelerate reform in both education and training systems.
In terms of pre-accession assistance under components III and IV, these priorities comprise acquis-related investment in environmental protection and European transport networks together with support to the productive sector, in particular to SMEs in disadvantaged regions, and to human capital formation.
At the same time, the renewed focus on achieving a greater ownership of cohesion policy on the ground is reflected in the provisions for a more open and an on-going dialogue across the partnerships developed both within the national and regional context as well as with the relevant Commission services.
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Insofar as components III and IV are concerned, the Community Strategic Guidelines will accordingly be instrumental in informing the preparation and elaboration of the national SCF which identifies Croatia's own development needs and strategic priorities as the basis for assistance under the Operational Programmes referred to above. Where possible, co-financing from IFIs will also be sought.
In the context of Component IV in particular, the Joint Assessment Paper (JAP) and the Joint Inclusion Memorandum (JIM) provide a strategic policy reference framework in which to develop a coherent and consistent identification of the key employment and HRD-related challenges which need to be addressed.
To this end, the background analysis incorporated under the current situation in relation to Component IV draws heavily from the analysis already jointly established under the respective JAP and JIM processes.
At the same time, the process of identifying the key challenges in the employment, human resource development and social domains has been instrumental in shaping the make-up of both the major areas of intervention and the main priorities established hereunder in respect of Component IV.
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Component III – Regional Development
1. Current situation
The overall aims of Croatian economic policy are to promote employment and raise living standards while strengthening macroeconomic stability and furthering structural and other necessary reforms. In this context, regional development is a high priority, the goals of which are to:
(i) strengthen the country's infrastructural base;
(ii) reduce the development imbalances, in particular promoting the prospects for sustainable development of regions lagging behind and of border areas;
(iii) decentralise, reorganise territorially and strengthen local authorities.
Taking account of the limited availability of IPA resources, three areas of interventions compatible with the key objectives of providing basic infrastructure and stimulating the growth potential of regions qualifying for the Convergence objective of the Structural Funds have been retained. The first two areas focus on investments and collective services that are required to increase long-term competitiveness, job creation and sustainable development, namely acquis-related investments in environmental protection and sustainable transport. Along with these efforts directed at basic infrastructure, the third area aims at modernising and restructuring the productive capacity of disadvantaged regions in particular by providing services to enterprises, particularly small and medium sized enterprises (SMEs), by improving access to finance, promoting Research and Technology Development (RTD) and innovation, disseminating Information and Communications Technology (ICT), etc. For all three areas, support for strengthening institutional capacities and the institutional order may form part of the interventions.
The selected areas belong to national policy priorities as defined by the country's Strategic Development Framework. In compliance with the acquis in the field of environment, Croatian policy is for environmental protection and the sustainable use of natural resources to underpin all economic activities. To this end, a National Environmental Action Plan (NEAP) has been developed. Similarly, economic activities are to be stimulated by the provision of adequate and sustainable transport infrastructure with a particular attention to the restructuring and upgrading of the railway system. Croatia has equally put an emphasis, on the one hand, on promoting the growth of SMEs to help meet its goal of fostering sustainable development within the framework of a market-oriented, stable and predictable business environment and, on the other hand, on a balanced regional development.
1.2 Environment
1.2.1 Water
The average national water supply connection rate level from public sources in Croatia is approximately 76%. Average water losses are high (46% national average) and with 127 municipally-owned water companies in a country of 4.5 million people, the sector is very fragmented. The level of water supply reliability in Croatia is generally satisfactory, except in tourist areas (especially islands) during the summer period.
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1.2.2 Waste Water
Currently approximately 40% of the population is connected to the public sewerage system with less than 20% of all municipal wastewater undergoing any kind of treatment. Only half of this amount meets national standards with just 4.4% of collected sewage being subjected to biological treatment. Furthermore about 50% of the total amount of industrial effluent is discharged into the public sewerage network after just preliminary treatment, which does not always meet minimum standards for such waste. A further 30% of industrial effluent is discharged into the water courses without any treatment. Most of the 74 existing wastewater treatment plants need to be upgraded to meet EU standards.
1.2.3 Waste management
80% of Croatian households are covered by organised municipal waste collection systems. The country has 252 registered waste landfills, which are used by public utility companies or waste disposal concessionaires. It is estimated that a further 3.000 uncontrolled dump sites exist in Croatia. The country has no official landfill for the disposal of hazardous waste.
The small number of organised official, and the great number of uncontrolled dump sites have a detrimental effect on the environment, the quality of life and the development of tourism.
1.2.4 Air quality
Most Croatian indicators show a reduction in the emissions of major air pollutants (from 15 to 50 %) since 1990. Presently Croatia fulfils the peak emissions targets set down by the Protocol to the Convention on Long-range Trans-boundary Air Pollution, relating to a further reduction of sulphur emissions by 60 % in comparison to the 1990 value.
The major sources of pollution are combustion processes, mainly large stationary sources (five thermal power plants and three refineries) and traffic. The high share of traffic in air pollution indicates that in the future the greatest pressure may be expected from this sector.
1.3 Transport
Croatia lies on a number of important transportation links between Western Europe and the Balkans, as well as between Central Europe and the Adriatic and Mediterranean seas. Five Trans European Network corridors and their branches cross the Republic of Croatia: • X Salzburg - Villach - Ljubljana - Zagreb - Belgrade - Skopje - Thessaloniki • Xa Graz - Maribor - Zagreb • Vb Rijeka - Zagreb - Budapest • Vc Ploče - Sarajevo - Osijek - Budapest • VII the Danube river
Croatia has a very comprehensive and well-developed transport sector. The country’s transport infrastructure has considerable significance for Croatia’s national development.
1.3.1 Roads
The basic road network of the Republic of Croatia has a total length of 29.016 km and includes:
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• 1065 km of motorways and expressways; • 6,812 km of national roads; • 10,604 km of county roads; • 10,535 km of local roads;
The density of the road network is 50km/100km2 with motorways amounting to 1.83km/100km2. Croatian roads account for 56% of all passengers transported in the country. In 2005, 64.8 million passengers and 58.9 million tonnes of goods were transported on Croatia’s roads.
1.3.2 Railways
Croatia has a total of 2.720 km of railways out of which 543 km are dual track with 2,465 km of single track. 977.4 km of track is electrified, i.e. 36 % of the total length. The following portions of the railway network forms part of Trans European Networks and their branches: • X Savski Marof - Zagreb - Vinkovci - Tovarnik • Vb Rijeka - Zagreb - Botovo • Vc Ploče - Metković and Beli Manastir - Osijek - Vrpolje - Šamac
The Croatian railway network suffered significant war damage and the amount of railway traffic has still not returned to its pre-war figures. Croatian railways also suffered from a lack of investment due to the main focus on the construction of a national motorway network.
1.3.3 Inland waterways & ports
Croatia has a total of 787.1 km of navigable inland waterways which include: • a 137.5 km length section of the river Danube, • a 446 km section of the Sava river, • a 198.6 km section of the Drava river, • a 5 km section of the Kupa river,
Croatia has five inland waterway ports located at Osijek, Sisak, Slavonski Brod and Vukovar. The infrastructure of the inland water ports is in poor condition.
Only 0.8 % of the overall transport of cargo was by river in 2002. The amount of international traffic operating on the Danube river is growing and the ports of Vukovar and Osijek, despite the lack of substantial investment in and maintenance of port infrastructure, have noted an upward trend in the transportation of goods, most of which can be attributed to international transport.
1.3.4 Maritime ports
Croatia has seven maritime ports: Pula, Rijeka, Senj, Zadar, Šibenik, Split, Ploče and Dubrovnik. Among these ports, the following have been defined as the most significant ports according to their function: • cargo ports: Rijeka and Ploče.
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• passenger ports: Zadar, Split and Dubrovnik, The infrastructure in Croatian maritime ports lags behind the infrastructure created by the competition, despite substantial investments made over the past five years.
1.3.5 Airports
Seven airports are situated within the Republic of Croatia: Zagreb, Dubrovnik, Split, Zadar, Pula, Rijeka and Osijek and two airfields (at Mali Lošinj and Brač) where public air services are operated for domestic and international travellers. The airports of Zagreb, Split and Dubrovnik account for about 90% of all air passenger transport.
Croatian airports lag behind the airports in other European countries, particularly regarding passenger, plane and cargo handling techniques on arrival and departure.
1.4 Regional competitiveness
1.4.1 Regional disparities
Whereas at national level GDP per capita amounts to 45.6% of the average of EU 25, Croatia has to contend with well-marked regional disparities. The three most developed counties have a two to three times higher GDP per capita than the three least developed counties. Compared to average GDP per capita of EU25, the difference ranges from 77% in the city of Zagreb to 26% in Vukovar-Sirmium county.
In terms of employment possibilities, there are also significant variations within the country: The extremes lie between the Istria county with the lowest unemployment rate (5.7%) on the one side and Vukovar-Sirmium county (31.2%), on the other.
Croatia decided in 2004 to address the factors creating and widening disparities between the regions by putting a balanced regional development among its national priorities. It started to work together with regional and local self-governments, social partners and civil society on defining its regional development policy and establishing efficient management of regional development, with the aim of allowing sustainable development of all Croatian regions, with special attention given to the disadvantaged areas. This resulted in the elaboration of a Draft National Strategy for Regional Development (NSRD) which, through the Programme for the Development of Disadvantaged Areas (PDDA) foresees:
(i) to create an integrated national policy framework with an exclusive focus on the eradication of disadvantage and disparities and to prepare and implement an integrated Government plan for development of disadvantaged areas, and
(ii) to build capacity nationally, within counties and within the disadvantaged areas to work together in purposeful manner to tackle disadvantage.
1.4.2 SME sector
The SME sector of Croatia accounts for 99% of the number of companies and employs 60% of the labour employed by these enterprises. Its share in GDP stands at 45-50% and in exports at 45-55%. The vast majority of the sector (92.2%) is constituted by crafts (2/3) and micro enterprises (1/3) which employ over half the sectors labour force. As employment by SMEs growths at a faster pace than the employment in other segments of the economy, SMEs have
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the potential to contribute significantly to economic growth, increased competitiveness and employment over the coming years.
On the other hand, the problems the sector suffers often include insufficient entrepreneurship activity, low levels of education of entrepreneurs and lack of profitability. The level of cooperation of the business sector with research institutes and technology centres remains inadequate, as is the level of RTD expenditure. SMEs face administrative barriers, regulatory weaknesses, inconsistency in the implementation of education/training for entrepreneurs, lack of tailored incentives and financial instruments adapted to them, and insufficient institutional support on the regional level for entrepreneurship development.
2. Major areas of intervention
2.1 Environment
According to the Accession Partnership the main areas of intervention for Croatia in the environmental area are the following sectors: • waste water • drinking water • waste management
Particular emphasis is to be given to the management of solid waste. In this respect the adoption and implementation of a national waste management plan is to be a priority. The adoption of the plan will enable the development and adoption of regional waste management plans and provide a strategic and structured approach to the problems of waste management on both the national and regional levels. Since waste management was identified also in the ISPA Environmental Strategy for Croatia as a priority area the measures to be taken will complement measures already started using ISPA.
Projects in the area of water and wastewater will be carried out in the order of their expected environmental impact, readiness for implementation and availability of finance, starting with projects in the largest conurbations.
In general and wherever possible, the measures are to be complementary to previous measures carried out under different EU programmes, or by IFIs, in order to create a larger impact as well as provide a consistent approach.
2.2 Transport
The main priority outlined in the Accession Partnership for the transport sector is the continuation of the implementation of the Memorandum of Understanding on the Development of the South East Europe Core Regional Transport Network. In the case of Croatia this means the implementation of measures on the four Pan European corridors that run through the country i.e. corridors X, VII, Vb and Vc, These four corridors are given particular priority in the MoU. Recent efforts by Croatia have concentrated on improving and extending the motorway network along these corridors and, as a result, the railway network and inland waterway transport have become increasingly less competitive. To redress this situation the main priority for the transport sector will be the upgrading and improvement of the railway sector and the upgrading of the inland waterway infrastructure. Due to the limited funds available it will be essential to concentrate efforts at specific areas in order to ensure maximum impact from the available resources. Since corridor X is the most important
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transport corridor in Croatia, and measures to upgrade the inland waterway infrastructure along corridor VII can be realised with relatively low individual budgets, the available finance will be used to implement measures primarily along these routes. Wherever possible, the implementation of River Information Services along the Danube should be addressed in cooperation with Serbian authorities. Furthermore, due to the limited amount of funds the mobilisation of additional sources of finance such as EIB, IFIs or Public Private Partnerships should be attempted wherever possible.
2.3 Regional competitiveness
2.3.1 Economic competitiveness
As recognized by the Lisbon and Gothenburg strategies, policies aimed at establishing and supporting new enterprises (especially SMEs), nurturing an information society, and development based on innovation and new technologies have a positive effect on economic competitiveness and sustainable and cohesive development. One element underpinning successful intervention is the need to increase productivity by means of increased investment, notably by SMEs, into RTD, innovation and new technologies, including through an enhanced cooperation between the private sector and scientific bodies. The other is one of pursuing international standards, specialization, and focus on high value added products and services through more and better entrepreneurship training, assistance and business infrastructure, as well as networking and clusters. These kinds of policy improvements contribute to the overall priority which the Accession Partnership for Croatia identifies in the short-term, namely the need to further improve the business environment by improving conditions for the development of private enterprises and direct investment and by simplifying rules of market entry and exit.
2.3.2 SMEs as a key factor for development
The scarcity of resources available and the need to avoid ineffective fragmented activities are elements, which justify that interventions, are concentrated on a restricted number of sectoral priorities. Accordingly, IPA assistance will focus on promoting a competitive economy conducive to entrepreneurship and investment in innovation, including Information and Communications Technologies (ICT), as well as unlocking the business potential, exclusively as SMEs are concerned, supported by a skilled and adaptive labour force capable of adding value in a modern knowledge based economy. In this context, the Regional Competitiveness intervention area will mainly support SME activities related to the economic and productive sphere, whereas the Human Resources Development Component will complement these activities with activities in the human capital sphere. Overall, it is envisaged that the activities will be flanked by a wider policy framework from the Croatian government aimed at adapting and/or downsizing the various development and assistance programmes currently on offer from various bodies and ministries and which often provide little incentive for a shift towards greater competitiveness of enterprises and better quality of services to enterprises.
2.3.3 Territorial concentration
In order for the limited IPA resources to be effective in strengthening the country's internal cohesion, it is required that assistance focuses, in priority, on reducing the socio-economic disparities between disadvantaged areas and the rest of the country. Among others, these areas include the war-affected areas and, where justified, urban areas suffering high unemployment. In principle, disadvantaged border areas would qualify but only to the extent
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that the assisted activities would not qualify for assistance under Component II. From this point of view, IPA assistance is consistent with the approach adopted by the national Programme for Development of Disadvantaged Areas (PDDA) which constitutes one of the instruments of the Draft National Strategy for Regional Development.
2.3.4 Capacity building
As part of further developing and implementing a comprehensive and coherent strategy of regional development, there is need for strengthening administrative capacity and the institutional base. This is a precondition for drawing pre-accession and future structural funds, as well as effectively directing these funds into measures enhancing the national convergence towards the EU socio-economic average and a similar socio-economic convergence within Croatia itself. However, addressing this overall need satisfactorily within the framework of the Regional Competitiveness intervention area goes beyond the scope and capacity of this area. In principle, capacity building activities at different levels will be limited to those activities where they concern a better and proactive delivery of services and products, at large, to the SMEs situated in priority in the disadvantaged areas as defined under point 2.3.3. Capacity building activities aimed at strengthening the wider institutional framework for a sustainable regional development policy would then qualify for IPA assistance under Component I.
3. Main priorities
3.1 Environment
Environmental projects to be financed under IPA need to be closely linked to the implementation of environmental plans in the relevant sectors (water, waste water, waste management) with waste management projects being the subject of particular attention. In addition, investments for promotion of energy efficiency and the use of renewable energy sources may be supported under this priority. In general, the projects should be selected in a way that compliments or enhances other measures in the sector already taken in order to increase the impact of the EU assistance. Projects will be selected with the aim of achieving maximum impact where the national financing capacity is insufficient and absorption capacity is assured.
The prioritisation of projects to be financed under IPA constitutes a key issue. In this context the prioritisation criteria must be considered very carefully. Based on previous experience the following main criteria are suggested: • a link to the implementation of environmental plans and sectoral strategies for the environmental acquis; • an integrated approach; • having a major impact on the population; • the financing capacity, taking also account of co-financing capability; • respect for the general principles of environmental policies/conventions; • the institutional capacity; • respect of the polluter pays principle; • the financial sustainability; • adequate balance with other financial sources.
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The projects proposed will have to comply with the relevant environmental acquis, in particular the Environmental Impact Assessment Directive (85/337EEC as amended) and the Habitats and Birds Directives (92/43/EC and 79/409/EEC), as well as with the relevant sectoral directives.
3.1.1 Water sector
Investments relating to waste water collection and treatment, and drinking water supply are to be the priorities in the water sector. In order to most efficiently distribute the available resources consideration should be given to the following factors: • the construction of wastewater treatment plants in settlements where sewerage networks are already well developed; • increasing the sewerage network connection rates and constructing wastewater treatment plants in areas with already well developed water supply systems; • repairing existing sewerage networks suffering from significant permeability, which effects drinking water sources; • the reduction of water network losses to ensure greater efficiency of the existing water distribution systems; • increasing the efficiency and reliability of public sewerage and wastewater treatment systems; • the compatibility, operating and efficiency implications of constructing secondary and tertiary sewage treatment facilities in independent stages;
3.1.2 Waste management
Waste management measures in Croatia are to be undertaken within the framework of the National Waste Management Plan and corresponding Regional Waste Management Plans currently being devised and which are mandatory according to Art. 7 of the Waste Framework Directive (2006/12/EC). Due to the limited amount of funds available, measures should be concentrated in investment in infrastructure, through constructing new waste management centres at county and/or regional levels, reducing the amount of waste to be sent for landfill by improvement of separate waste collection, recycling and waste treatment systems and remediation and/or closing selected existing local landfills..
Projects must be of sufficient scale to have a significant impact in the field of environmental protection and the creation of new waste management facilities should take precedence over the remediation/closure of locally existing landfills, which should be implemented as soon as possible following the completion of the new waste management facility.
A systematic approach needs to be taken in each county/region by concentrating initially on measures that provide the maximum environmental improvement for the limited available funds. In this respect maximum opportunity should be given to the involvement of the private sector in particular with relation to waste segregation, recycling and waste treatment activities.
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3.2 Transport
To improve inter-modal and inter-operability possibilities in accordance with EC Directives, measures in the transport sector are to be aimed at modernising and improving the railway network and inland waterways network to European standards primarily along Pan European corridor X and VII, which forms part of the South East Europe Core Regional Network. The measures to be undertaken must be selected and implemented in a coordinated and structured way, taking into account the work carried out in the South East Europe Transport Observatory (SEETO), to ensure an immediate benefit following completion. Wherever possible, the implementation of River Information Services along the Danube should be addressed in cooperation with Serbian authorities. Maximum involvement of the EIB and IFIs should be sought in order to maximise the impact of the measures to be funded by IPA, as well as due to the capital-intensive nature of the sector.
The projects proposed will have to comply with the relevant environmental acquis, in particular the Environmental Impact Assessment Directive (85/337EEC as amended) and the Habitats and Birds Directives (92/43/EC and 79/409/EEC), as well as with the relevant sectoral directives.
3.3 Regional competitiveness
The priorities under this area of intervention can be grouped under two distinct objectives:
The first objective is to enhance regional competitiveness and the productive environment, and encourage the creation and safeguarding of sustainable employment. Assistance under this objective will thus focus on supporting productive investments and strengthening the competitive position of new and existing small and medium sized enterprises, including micro enterprises, situated, in priority, in the disadvantaged areas as defined under point 2.3.3. Investment aid to SMEs will be complemented by assisting business and technology services for enterprises, such as in the fields of management, market research, industrial standards and development networking and the access to and the use of ICT, as well by provision of business infrastructure, and by promoting technological development, research and innovation, including through cooperation with tertiary education and research institutions and with research and technology centres, and business networks and clusters.
The second objective aims at empowering and increasing the capacity for action, effective governance and flexible cooperation of the public administrations at national, county and local level, as appropriate, with respect to the support measures enumerated under the first objective and relating, in priority, to the disadvantaged areas as defined under point 2.3.3.The priorities under this objective will encompass support to the improvement of administrative efficiency regarding the delivery to SMEs of quality advice, e-business, ICT and innovation, and entrepreneurial support services at large, including business coaching, and the stimulation of systems of cooperation, networking, partnerships, workshops and clusters of excellence between business and other institutions. Assistance under Component I may in this regard be used to support improvements in the overall business environment in Croatia.
4. Expected results
In addition to the specific results expected from investments in the environment and transport sector, on the one hand, and from support measures to SMEs, on the other, a core objective of Components III and IV is to support Croatia in the areas of policy development
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and project and programme implementation and management, with a view to its successful participation in the Community's Cohesion policy and instruments upon accession. Accordingly, key expected results of IPA support under the Regional Development Component are: • Acquisition of experience in investment planning, implementation and management capacity, through technical assistance interventions and through a process of "learning by doing"; • improvement of the capacity to prepare, implement and manage large-scale infrastructure projects in the environment and transport sectors, as well as a programme comprising various areas activities concerning SME development, following a Structural Funds and Cohesion Fund approach, in particular at the level of the beneficiary.
4.1 Environment
The expected results of the priorities supported in the environmental domain are: • a reduction of the pollution of recipient water bodies; • an increase in the quality and availability of drinking water; • further development of integrated waste management system; • the construction of waste management centres compliant with EU requirements and the remediation and/or closure of selected existing landfills; • an improvement in the capacity to prepare, implement and manage large-scale infrastructure projects in the environmental sector, in particular at beneficiary level; • environmental protection will be improved; • efficiency and sustainability will be improved; • use of conventional energy will be reduced; • new jobs will be created; • consumer friendly output will be furnished.
4.2 Transport
The expected results of the priorities supported in the transport domain are: • inter-modal competition will be restored; • links with the European Union will be improved; • level of safety considerably increased; • traffic bottlenecks will be reduced; • waiting times at borders will be reduced; • efficiency and sustainability will be improved; • travel times for freight and passenger traffic will be reduced.
4.3 Regional competitiveness
The expected results of the priorities supported in the Regional Competitiveness domain are: • productive investments by SMEs will be facilitated; • innovation and technology content of products of and processes in SMEs will be enhanced and international industrial standards be introduced; • new businesses will be created in the manufacturing and services sectors and existing businesses will be reinforced;
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• cooperation and networking between SMEs as well as between SMEs and other stakeholders, universities and R&D institutions will be strengthened; • turnover and export performance of SMEs will be increased; • new jobs will be created and the quality of existing jobs will be improved; • e-communication and ICT content of enterprises and administrations will be enhanced; • principles of 'good governance' will be applied by the relevant administrations; • business climate will be improved; • income and quality of living in the disadvantaged areas will be improved.
5. Forms of assistance to be provided
The following programmes will be implemented under Component III: • One Environment programme with focus on the water and solid waste sectors, where the impact on the population is the widest and the self-financing capability the least; • One Transport programme covering, in principle, the whole territory, but focusing on the development of the railway system and the inland waterway network.
Large capital investment projects with an investment cost of more than €10 million will be predominant in these two operational programmes. • One Regional Competitiveness programme to stimulate growth and competitiveness in priority in designated disadvantaged areas through productive and service support to enterprises, in particular SMEs, and good governance of the support measures concerned.
Complementarity and synergy between the measures undertaken under this programme and those undertaken, in particular, under the Human Resources Development Component will be ensured. Where appropriate, the measures of this programme will also be coordinated with those of the Institution Building, Cross-Border Cooperation and Rural Development Components.
6. Financial indications
Table 8: Financial indications – Component III Environment programme 35 – 40 % Transport programme 35 – 40 % Regional Competitiveness programme 20 – 30 %
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Component IV – Human Resources Development
1. Current situation
In setting out the current situation as it relates to Component IV, the development of the analytical background to the formulation of the JAP and JIM policy instruments has been a key factor. At the same time, the 'socio-economic' analysis governing the strategic direction of the SCF assumed an important focus in the process of establishing coherence with Croatia's own needs insofar as they relate to components III and IV.
In relation to the Accession Partnership and, in particular its perspective of accelerating preparations for future assistance under the ESF, both the 'short' and 'medium-term' priorities identified therein have informed the analysis presented hereunder in particular as it relates to the field of social policy and employment.
At the same time, parallel developments under the revised Lisbon process, as well as the formulation of the Community Strategic Guidelines 2007-2013, have also been taken into consideration in identifying the 'major areas of intervention' as well as the corresponding 'main priorities' outlined under sections 2 and 3.
Taking these background developments as a whole, the current situation is presented hereunder on the basis of the following 'broad' policy categories -
Employment
In terms of its demographic profile, Croatia's share of older population continues to grow at the expense of its younger generations, which are in decline. As a result (and in the absence of significant changes to the flow of net immigration), the ageing of the population is projected to continue.
More particularly, with 'baby-boom' generations reaching retirement (pensionable) age from 2005 onwards, it is anticipated that the replacement of the working-age population will no longer be sustainable in the absence of 'equilibrium-restoring' immigration flows (current estimates show some 336.500 people in the 45-49 cohort in 2005 with corresponding figures of 295.600 and 275.500 in the 30-34 and 15-19 age groups).
With declining numbers of young persons entering the labour force, its overall character has assumed an older profile. As a consequence, an on-going requirement remains to increase the employment rate and efficiency in expenditure in order to 'shoulder' the growing relative burden of social security transfers and healthcare needs associated with an ageing population.
In accordance with Eurostat data, the employment rate for the working age population (15- 64) stood at 54.8% in 2005 representing as much as 9 percentage points below the EU-25 weighted average. At 31.5%, the 2005 employment rate for the 55-64 age cohort was some 11 percentage points below the adjusted EU-25 average.
While the contributory factors giving rise to low levels of employment across all groups will remain present to varying degrees (inter alia labour market rigidities, war consequences on economic capacities, restructuring under privatization, short-term economic and seasonal fluctuations, foreign competition coupled with excessive wage growth in certain sectors), the
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policy prescription of accelerating overall employment growth needs in the longer term to be driven by increased productivity allied to stronger demand.
In this context, fostering a stronger culture of entrepreneurship, as well as reducing the impact of the informal economy, will be key factors in addressing the relatively modest job- creation performance outside the small and micro enterprise sector.
Registered employment increased by 5.9% over the 2000-2005 period while the unemployment rate fell from 16.1% in 2000 to 12.7% in 2005 (i.e. 3.9 percentage points higher than the EU-25 average). Registered unemployment decreased by 13.7% over the same period. Underlying factors in this downward trend included institutional changes in war- veteran benefits, earning limits on unemployment benefit recipients as well as more stringent job-search requirements for the unemployed.
Nevertheless, economic fluctuations continued to play an important part in determining the flows from registered unemployment to registered employment. Particularly pronounced was the problem of youth unemployment with a 12.3% 'share' for the 15-24 age group in 2005 as against an EU-25 average of 8.4%. At the same time, long-term unemployment (particularly across all women cohorts) remains persistently high and a continuing focus of concern in the development of more effective policy responses.
In terms of Croatia's regional labour market profile, wide differences persist with Istria County recording just a 5.7% registered unemployment rate in 2005 as against 31.2% in Vukovar where the consequences of the war have been particularly severe.
An additional factor giving rise to these differences was the widely-varying characteristics of the industrial and sectoral structure of the counties such that those with low labour demand were closely linked to low quantity and quality of both physical capital and natural resources. At the same time, higher regional unemployment rates were closely related to lower average wages demonstrating insufficient flexibility as a further source of regional differences.
In contrast to the EU-25, the sectoral structure of the economy reveals a considerably higher share of employment in the Agricultural sector as well as a somewhat larger share of those employed in industry (1.7% higher than EU average). However, growing flexibility and responsiveness to change is projected through the country's emerging economic profile as evidenced by the continuing growth in the service sector.
On the other hand, progress to-date has been slow insofar as the privatisation and restructuring process is concerned with continuing high levels of state aid by EU comparison.
Although tripartite social dialogue is relatively well developed in Croatia, there remains scope (as identified under the Accession Partnership) to further strengthen social partners' capacity-building efforts notably through autonomous bipartite social dialogue.
Education and training
By EU-25 comparison, Croatia has a considerably lower share of highly-skilled workers within its total number of employed. While the share of highly-skilled non-manual workers was 38.6% in the EU-25 2005, the corresponding figure in Croatia was 10.2 percentage points lower.
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Comparing the share of tertiary education graduates (ISCED 5 and 6), Croatia also lags behind the EU-25 average – Eurostat 2002 data shows 24.3% of EU-25 population in 30-34 age bracket with a tertiary-level qualification while the corresponding figure for Croatia was only 16.3%. However, while the need to strengthen the labour market relevance of higher education remains an important policy consideration in boosting economic development and productivity, the actual number of tertiary-level graduates has been steadily increasing since 2000 with women taking an increasing share (60% in 2005).
Although characterised by a low share of highly skilled workers as well as by a low share of the highly educated, Croatia also possesses a wide coverage of secondary education especially amongst the younger generation. In 2005, the share of the population aged 20-24 with at least secondary level of education (ISCED 3-4) was 93.9% compared to an EU-25 average of 76.9%. However, as in the case of the tertiary sector, the quality and responsiveness of the secondary education system to labour market requirements (in particular the content, profile and range of competencies under the VET system) needs to be further strengthened and developed.
As in the case of most EU countries, the highest unemployment rates were found amongst the lowest educational attainment groups with some 40% of the Croatian working-age population possessing only basic school education (8 years compulsory education) or less. As a result, unemployment rates as high as 13.3% persist across the 25-29 age cohort with primary level education as compared to only 5.8% for those with tertiary-level qualifications.
In accordance with OECD 2004 EU-15 data for the 25-64 age cohort, the employment rate was approximately 9.5 percentage points higher for those with tertiary as opposed to secondary-level qualifications (in the case of women in the same age bracket, the difference was more pronounced at 13.5 percentage points). While these trends were also mirrored in Croatia, the corresponding differences were as high as 13 percentage points for the 25-49 age cohort and 17.8 percentage points for women in the same age bracket.
Beyond the comparatively low education attainment levels generally, the high incidence of 'drop-outs' at both secondary and tertiary level remains a focus for policy reform (e.g. the ratio of 2005 tertiary education graduates to 2001 enrolments was as low as 41.3%).
Though data on functional literacy rates are not available, Croatia's active participation in the OECD PISA test for 15-year-olds is envisaged in the course of 2006.
Although variances in the unemployment rates across different educational attainment levels partly reflect the mismatch between the skill structure of the labour supply and the requirements of the labour market, marked differences in the flows from registered unemployment remained across various professions and occupations notwithstanding similar levels of attainment.
More generally, policy recognition continues to take hold on the need to reduce the level of occupational skills mismatch through structural reform of the labour supply, in particular through reform of the content, profiles and outcomes within the education sector. Combined with greater wage flexibility, such a reduction would also contribute to a greater equalization of opportunity in terms of labour market access.
Also on the supply side, the lack of adequate provision in the Adult Education Sector remained a policy concern particularly when set in an EU-25 comparative context. According
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to Eurostat 2005 data, participation of the 25-64 age cohort in formal education or training was as low as 2.3% in comparison with an EU average of 11%.
In terms of 'standards' of education and the application of 'evaluation criteria' (e.g. development of curriculum standards, in-service training and teaching methodologies), marked differences persist at county level while, at national level, efforts are underway to strengthen curricula and examination standards with the establishment of the National Centre for External Evaluation.
Social inclusion
In addition to tackling systematic weaknesses within the social welfare system and strengthening its overall structure and sustainability, the key policy objective remains one of better targeting in order to ensure that social benefits reach the more vulnerable groups and those most in need. Viewed from a current perspective, the targeting of social spending remains extremely low and is reflected in the low volume of funding spent on social benefits.
With the exception of those in employment, a range of categories remained particularly exposed to social exclusion and had a relative poverty risk above the average (incl. self- employed, unemployed, low skilled with educationally poor attainment levels, disabled, IDPs, pensioners and other economically inactive).
While the unemployed and economically inactive groups in general remained exposed to the highest at-risk-of-poverty rates (approximately 32% which is twice the national average), female-headed households as well as those with no or inadequate pension entitlements were deemed to be at specific risk
Moreover, the high share of the economically inactive population tended to mask the high incidence of long-term unemployed and discouraged workers as well as highlighting the declining and ageing population of rural areas including problems of the working poor as well as one-person rural households and those in subsistence agriculture.
Amongst the Roma population, at-risk-of-poverty rates were significantly more widespread than in other groups with some 13% living close to absolute poverty levels.
Although a high percentage of the population have only primary educational attainment levels or below (approximately 40% according to 2001 census), the strong correlation with relative poverty risks for this segment of the population served only to compound their overall level of disadvantage in access to education and the labour market.
In terms of population and welfare, significant regional disparities persisted between the most and least densely populated counties. More particularly, the 3 most-developed counties continued to show a GDP per capita which was over twice that of the 3 counties identified as being the least-developed.
With more reliable data on regional distribution of poverty being developed through the World Bank's 'Living Standards Assessment', the evidence emerging revealed that areas most affected by the war remain those with the highest level of permanent social assistance beneficiaries. At the same time, areas with a high concentration of Roma population were also identified with well-above-average levels of such assistance while rural areas in Central and Eastern Croatia continued to suffer from higher-than-average poverty rates.
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Accounting for some 45% of all permanent social welfare beneficiaries, the unemployed in general continue to face exposure to poverty risks of varying degrees, in particular those encountering inadequate benefit protection arising from longer durations outside the labour market.
Beyond the wider policy objective of strengthening 'demand-led' job maintenance and creation, the promotion of overall 'better-quality' social services remains a key objective in bringing more people into employment, in particular by facilitating greater labour market access through the development of quality standards, training and work-related conditions, certification and accreditation.
As a key function of human capital development, the need to strengthen access to general healthcare provision should also form an integral element in the promotion of 'better quality' services.
In the context of pension reform, the inheritance of a wide spectrum of 'special' pension entitlements regulated under existing legislation (inter alia war and veteran pensions) represents a particular challenge in bringing about a more inclusive pension and social benefit system. Combined with an unfavourable 'demographic profile' (i.e. an aging population with low fertility and high emigration rates), the wider policy challenge must be directed towards achieving greater fiscal sustainability allied to the need to streamline the management of the state budget.
2. Major areas of intervention
In identifying the major areas of intervention and goals set out hereunder in respect of assistance under component IV, appropriate reference has been made to the Accession Partnership as well as to the Community Strategic Guidelines 2007-2013 [COM (2005) 0299] and the integrated Employment Guidelines (Council Decision 2005/600/EC of 12 July 2005). These include, in particular, the goals of: • Attracting and retaining more people in employment and modernising social protection systems, • Improving adaptability of enterprises and workers including labour market flexibility, • Increasing human capital investment through better education, and skills, • Strengthening administrative capacity in the employment, education/training, and social fields.
3. Main priorities
While recognising the need to ensure a high degree of concentration in line with relatively limited availability of assistance over the 2007-2009 period, the main priorities identified hereunder within each of the major areas of intervention are designed to provide a policy platform such that the priorities and measures assisted under component IV will act as a pre- cursor or catalyst to the on-going and further development of programming priorities as set out under Article 3 of the ESF Regulation (2007-2013).
Moreover, where component IV assistance is channelled towards the development of systems and/or qualification frameworks, the objective will be to ensure that the expected value- added and multiplier effects are built on and consolidated under future ESF programming and priority setting.
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Though at varying stages of elaboration, appropriate account has also been taken of the draft analysis as well as the future needs and challenges presented under the JAP and JIM joint cooperation processes. This will allow for a more focused approach to identifying relevant target populations.
Accordingly, the main priorities corresponding to each of the major areas of intervention are set out as follows:
3.1 Attracting and retaining more people in employment:
Increase participation in employment and strengthen both active and preventive labour market measures. Promote occupational and geographical mobility and develop more effective 'matching' of labour supply and demand (incl. development of 'synergies' with the 'competitivity' elements of component III). Address regional disparities in employment. Reinforce social inclusion at local and regional level through better targeting of vulnerable groups including enhanced access to employment and labour market re-integration of job-seekers and the inactive.
3.2 Improving adaptability of enterprises and workers:
Develop a more anticipatory approach to work and economic change and increase investment in competencies and qualifications of both workers and enterprises. Encourage active ageing and longer working lives. Promote a culture of entrepreneurship and develop more innovative and productive forms of work organisation. Promote a more flexible labour market in conjunction with more efficient social security measures. Further strengthen social dialogue bipartite mechanisms and promote a more active role on the part of the social partners.
3.3 Increasing human capital investment:
As part of developing a coherent HRD policy and national qualifications framework, increase the overall efficiency and quality of the education and training systems to promote greater employability. Strengthen human capital investment through better education and skills and the promotion of knowledge, research and innovation. Improve the labour market relevance of initial and continuing vocational education and training. Develop the overall offer, access and quality of adult provision as part of a life-long learning strategy.
3.4 Strengthening administrative capacity:
Develop institutional capacity and efficiency of public administration in the employment, education, and social fields. Strengthen the effectiveness of labour market institutions, in particular the employment services.
As an integral part of the MIPD strategy of promoting a series of cross-cutting themes across the IPA instrument as a whole, all operations carried out in respect of the above-mentioned priorities should fulfil the requirement of promoting equality between men and women including the integration of the gender perspective during the various stages of implementation.
4. Expected results
Under Component IV, the time-frame for assessing the expected results will be the on-going programme execution which will focus in particular on strengthening the public employment
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and education/training systems as well as on building the required structures and capacity to effectively manage and implement future ESF assistance.
Moreover, insofar as the beneficiaries themselves targeted under the Component IV interventions are concerned, results will focus on measuring progress in terms of their levels of employability and social inclusion.
In a wider policy context, the objectives of the assistance under the single HRD OP should be consistent with the HRD-related 'strategic priorities' set out in the SCF in addition to being closely aligned with the key employment and HRD 'challenges' established under the JAP and JIM joint processes. At the same time, they should be coherent with the relevant provisions of the Community Strategic Guidelines (2007-2013) and, in particular, the revised Lisbon Integrated (Employment) Guidelines.
From a structural funds perspective, the expected results will be set in the context of measuring the extent to which Component IV serves as a 'pre-cursor' to establishing future ESF needs and priorities, in particular in the fields of employment, education and training and social inclusion.
The longer-term time-frame envisaged for the expected results as they relate to ESF preparations is the date of accession.
5. Forms of assistance to be provided
In principle, Component IV will be implemented through a single multi-annual HRD Operational Programme (OP). Financial support in Component IV may take different forms, in particular service contracts, grant schemes and technical assistance. Where appropriate, this will be supplemented by supply, works or other contracts for the equipping of related operational facilities.
The interventions supported in this area will be implemented in close coordination with the Tempus programme, which will form part of the Multi-Beneficiary MIPD 2007-2009. The dissemination and exchange of best practice in the targeted areas will also be further enhanced.
6. Financial indications
In respect of the major areas of intervention set out under section 2, and taking appropriate account of the nature and scope of the main priorities outlined under section 3, the following indicative financial weightings (% ranges) have been established:
Table 9: Financial indications – Component IV Attracting and retaining more people in employment 30 – 40 % Improving adaptability of enterprises and workers 20 – 30 % Increasing human capital investment 30 – 40 % Strengthening administrative capacity 10 – 20 %
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Component V – Rural Development
1. Current situation
Agriculture plays still an important role in the overall economy of Croatia. Agricultural, forestry and fishery amounts up to 6.5% of GDP (EU-25: 1.6%). The share of agricultural labour in total labour was about 7.3% in 2003 (without forestry) (EU-25: 5%). About 10% of the population of working age earn their income from agriculture and the food industry.
Croatia can be divided into three natural and geographical areas: • The Pannonian and Peri-pannonian region, a hilly region in the North-East of Croatia, embraces approx. 47% of the total country area and 64% of the total Croatian population. Agriculture is predominated by arable farming and cattle breeding. • The Mountainous Region is located between the Pannonian region and the coastal area with 30% of Croatian population living there. Extensive agricultural production traditionally predominates which is carried out by small scale farms who are mainly engaged in cattle breeding. The region has a high potential for the development of organic farming and agro-tourism. • The Adriatic coastal region, covering a narrow coastal belt which is separated from the hinterland by high mountains. The region covers more than 1,000 islands. Most of the regional GDP is derived from tourism. The mild climate enables the production of Mediterranean crops such as olives, figs etc. Agriculture on small scale farms prevail.
Agricultural land accounts for 2,695,000 ha, 41% of which is arable land and 54% permanent grassland, the remainder is fallow land (set aside). A substantial part of the agricultural land is still uncultivated, i.e. no longer farmed for economic, social or other reasons (e.g. slow privatisation of state owned land). Beside wooden areas which accounts for the biggest part (63,350 ha), some 45,000 ha of agricultural land (arable land, pastures etc) are still polluted with mines.
According to the 2003 Agricultural Census 449,896 farms operate in Croatia, 67% of which utilise less than 2 ha per farm. The average farm size is 2.4 ha. Family farms possess 78% of arable land and more than 81% of the total livestock.
Almost 60% of the total Gross Agricultural Output (GAO) is derived from crop production, 40% from livestock products. Self-sufficiency is given in wheat, sugar, wine, maize, poultry meat and eggs, almost reached in raw cow milk (94%), and much lower in pork production (78%), beef and veal (73%), and sheep and goat meat (70%).
Croatia’s crop production is contributing significantly to marketable production in Western Balkan countries, especially as far as cereals (esp. maize, wheat) are concerned. Fruit and vegetable production with grapes and potatoes as the most important commodities accounts for 18% of the total GAO. The production of cereals and fruit and vegetable is still characterized by small-scale farms, the latter producing primarily for self-consumption and direct marketing (half of the production).
As regards livestock, pork production is the second-largest (after cereals) sub-sector in Croatian agriculture (13% of the total GAO) followed by cow milk (9%) and beef (7%). Poultry (5%) and eggs (4%) are less important. The sub-sectors are pre-dominated by small
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production units especially for cattle, swine production, sheep, and goat keeping. Poultry and egg production on the other hand is characterised by large-scale production unit.
The productivity of the agricultural production, especially in the livestock sector, is still low and characterized by small scale production, outdated production methods and equipment. This creates a high pressure for modernization, in particular as regards the necessity to upgrading the sector to respect Community standards on environmental protection, public health, animal and plant health, animal welfare and occupational safety in the light of the EU accession of Croatia.
Croatia is a net importer of agro-food products and maintains a high negative trade balance with the EU. Only for basic agricultural products, the trade balance in favour of the Community was of around 367 million € in 2005 (where the EU exported to Croatia 580 million € and imported 213 million €). The EU is Croatia's main trading partner. The remaining trade is conducted with the Western Balkan countries in particular Bosnia- Herzegovina where exports have increased substantially in the last few years. Croatia is a member of the WTO since 2002 and has concluded several free trade agreements with European countries, a new CEFTA agreement recently, as well as the Stabilisation and Association Agreement (SAA) with the EU.
The share of the Croatian food processing industry has remained relatively constant at 3-4% of GDP over the last years. The structure of the agro-food industry has been changing gradually over the past ten years as larger scale agro-kombinats have become less important and smaller-scale, modern and more efficient processing firms have begun to emerge. The privatisation of the agro-processing industries is almost completed. Important sub-sectors for employment include: beverages (19%), meat and meat production (18%) and milk/dairy (9.7%). The branches with the largest revenues are the production and processing of tobacco, beer processing, processing of milk, tea and coffee and the production of soft drinks.
The milk processing sector is dominated by two big dairies (more than 100 mio l per year) and around 35 medium and small scale enterprises (below 50 mio l per year). Bigger dairies run partly their own programme to increase the quantity and quality of the raw milk supply by giving support in improving on farm operations. However approximately 60% of the raw milk delivered to dairies is still not respecting the Community quality standard. Croatia has traditionally a large number of slaughterhouses with substantially underutilized capacity. As regards the most important sub-sectors, there are 196 slaughterhouses for red meat, 74 for poultry, and 20 for rabbit and game meat. Only a limited number of establishments for processing produces of animal origin is currently approved for the export into the EU market.
The fruit and vegetables processing industry has, due to the favourable climatic and agro- ecological conditions, a significant potential to develop. This is underlined by the significant increase in the production of fruit juices in the years 2000-2004. However the overall production remains low and processing of fruit and vegetables is still one of the most under- developed sectors of the processing industry mainly due to the insufficient domestic fresh fruit and vegetable production in terms of quality and quantity. According to OECD criteria, 92% of the total area of Croatia can be considered as rural areas with 2.11 million people (48% of the Croatian population) living there. In the period between the two Censuses in 1991 and 2001 the rural population (-75,000), but much more the urban population (-272,000), has decreased which was mainly due to destabilizing (external) factors, such as war. The divergence of living standards between rural and urban areas is still
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significant in terms of income, education, physical, social and cultural infrastructure, unemployment. There is still a high number of (semi)-subsistence agriculture, insufficient diversification of agricultural and non-agricultural income generating activities, and aging of rural population in the Croatian rural areas. Taking into account that Component V on the basis of the above description with regard to agriculture and rural development has the specific purpose of preparing the Croatian agricultur and agri-food sectors to meet EU requirements as well as helping the Beneficiary Country to get ready for the implementation of EU rural development programmes upon accession and thus assisting the Beneficiary Country with the building up of the administrative structures necessary to manage the future EU rural development funds, the main policy objectives under Component V are:
• to contribute to the sustainable modernisation of the agricultural sector (including processing) through targeted investments while at the same time encouraging the improvement of EU acquis related food safety, veterinary, phytosanitary, environmental or other standards as specified in the Enlargement Package, • to contribute to the sustainable development of rural areas.
The rural development component priorities will be implemented through a related multi- annual Programme covering the entire period of 2007-2013 in the framework of a fully decentralised system from the very beginning, which will significantly contribute to the achievement of this key target of preparing for effective implementation of EU rural development programmes.
2. Major areas of intervention
Assistance under the Rural Development Component will target the following three main priorities:
Priority axis 1: Interventions under this priority have to contribute to the sustainable adaptation of the agricultural sector and the implementation of Community standards concerning the common agricultural policy and policy areas like food safety, veterinary, phytosanitary and environmental matters.
Priority axis 2: Interventions under this priority have to take the form of preparatory actions for the implementation of agri-environmental measures and Leader.
Priority axis 3: Interventions under this priority have to contribute to the sustainable development of rural areas while supporting the development of the rural economy.
3. Main priorities
Under priority axis 1 the potential key issues to be addressed in Croatia should therefore be: a) The restructuring and the upgrading of the agricultural production sector to Community standards to increase the sector’s competitiveness. b) The setting up of producer groups with a view to adapting their production to the market requirements and enabling them to jointly place goods on the market (national programme). c) The restructuring and upgrading to Community standards of the processing sector for agricultural and fishery products in the light of EU accession.
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Under priority axis 2 the potential key issues to be addressed in Croatia should be: a) The preparation for the implementation of actions designed to protect the environment and maintain the country side. b) The preparation of rural communities to conceive and implement local and integrated rural development strategies through local private-public partnerships.
Under priority axis 3 the potential key issues to be addressed in Croatia should be: a) The improvement and development of rural infrastructure b) The development and diversification of economic activities in rural areas. c) The improvement of training (national programme)
To priority axis 1
The Croatian Accession Partnership identifies a number of short (1-2 years) and medium term (3-4 years) priorities for the agricultural and rural development sector as well as for food safety.
It stipulates that Croatia should in the short and medium term emphasize the modernisation of agro-food establishments in order to meet Community standards and establish a system for animal waste treatment as well as significantly improve the inspection structures for food safety, veterinary and phytosanitary policies.
Under the Croatian Sapard programme adopted on 8 February 2006, 60% of the Community funds are allocated to priority axis 1, in particular to the milk, meat, and the rendering sector with the objective to support the upgrading of private entities to Community standards. Given Croatia's objective of being ready for EU membership in a few years, the approach followed under Sapard needs to be pursued and enforced under the IPARD Programme.
The modernisation and restructuring of the farm and agricultural processing sectors should first and foremost be achieved through the upgrading to the Community's environmental, hygiene, food safety and animal welfare standards. Support granted towards the achievement of these objectives should mainly be concentrated on sectors where the related acquis communautaire to implement is particularly comprehensive and demanding like in the dairy, meat, rendering and fish sectors and where an in-depth analysis involving independent expertise has been carried out.
For the agricultural production sector such interventions should help to develop the sector to be able to deliver agricultural produce in the quantities and quality satisfactory by the agro- food industry.
Interventions in the agricultural food processing sector should in particular focus on the first processing sequence of agricultural and fishery products as well as the treatment of animal waste and risk material (rendering). Support for investments in that sector should be linked to the national plan for upgrading of establishments. Moreover, investments should mainly target small and medium size enterprises and should focus exclusively on the weakest links in the production, processing and marketing chain of each sector chosen according to acquis relevance. Establishments already certified for the EU market are not supposed to be beneficiary under this Component.
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The number of producer groups in the fruit and vegetable sector are described in the Sapard programme as being not sufficient. This should therefore be addressed in the Rural Development Programme. Due to the limited resourced available under Component V Croatia will address the support of producer groups through the national support scheme. An exhaustive description of the national measure including reserved budgetary means, timetable for implementation, and monitoring activities to ensure an efficient and effective implementation should be provided in the IPARD programme.
To priority axis 2:
The preparation for the implementation of actions designed to protect the environment and maintain the countryside should help Croatia to prepare for the agri-environment activities, which will become obligatory under the Rural Development Programme for EU Member States.
The application of LEADER will become obligatory under the Rural Development Programme for EU Member states. The preparation of rural communities to conceive and implement rural development strategies through local private-public partnerships will help Croatian rural population and the national administration to build up a LEADER structure and learn how to implement the LEADER approach.
To priority axis 3
The interventions under rural infrastructure are intended to follow the concept chosen under Sapard: Municipalities below a certain number of inhabitants, which form part of/or cover specific territories/regions/areas will be supported to implement projects addressing specific needs of the rural population. This could for example be the support of the construction of local public roads connecting farms located in agricultural production zones identified in the spatial plan of the municipality (as provided for under Sapard). This approach should ensure that the limited funds available under IPARD will be used in an effective and efficient way at the same time addressing specific needs of the rural areas.
The diversification and development of economic activities should especially help the rural population, in particular the big number of small Croatian farmers, to build up economic activities (on and off farm), in particular rural tourism, creating additional income sources and employment opportunities in rural areas.
The SWOT analysis in the Sapard Programme identified the vocational training sector as a weakness. The inclusion of such a support measure under the Rural Development Programme of 2007-2013 was recommended by the Sapard ex-ante evaluation. Training activities for the urban but also the rural population will be covered under Component IV. Specific training needs of the farming population would be targeted under Component V or under the national support scheme if appropriate.
Horizontal issues
The implementation of the IPARD Programme requires well functioning inspection services (in the field of environmental protection, public health, animal and plant health, animal welfare and occupational safety). Such services must be able to issue supporting documents required for the application of support and to carry out ex-ante and ex-post controls as regards the respect of Community standards of projects supported under this Component. As
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stipulated in the Accession Partnership the administrative capacity has to be strengthened (sufficient employees, training of staff, necessary equipment). Moreover, the services have to be functional to the extent necessary when the implementation of the IPARD Programme starts.
The Accession Partnership also defines that a rural development strategy as well as a policy instrument for the design, implementation, management, monitoring, control and evaluation of rural development programmes should be developed in the short term.
The Rural Development Strategy will identify the priorities and objectives of the policy for the development of rural areas in Croatia. It will in addition provide the strategic framework for support under the IPARD Programme co-financed by the EU. Croatia is therefore recommended to adopt the strategy as soon as possible.
Croatia should also establish a fully-operational Paying and Implementing agency to run IPARD.
The IPARD Programme and the Rural Development Programme post-accession will be negotiated based on agricultural and rural development data provided by the Croatian authorities. Therefore, the collection and processing of agricultural statistics in line with EU standards and methodology should as soon as possible be reinforced (see also the Accession Partnership).
Assistance to the above-mentioned horizontal issues may be provided under Component I if necessary.
4. Expected results
Component V has the main goal to facilitate the preparation of the beneficiary country for the participation in the Common Agricultural Policy (CAP) while at the same time assisting the beneficiary country with getting ready to effectively implement EU rural development programmes upon accession.
Taking account of the limited amount of funding available for Component V of the IPA, the assistance provided under the three priority axes under Component V should contribute to the following results by the time Croatia joins the European Union as a Member state:
Priority axis 1: • Improved income of the beneficiary farmers; • A better use of production factors on agricultural holdings; • Improved production conditions in terms of compliance with EU standards; • Increased added value of agricultural and fishery products through improved and rationalised processing and marketing of products; • Increased added value and competitiveness of agricultural and fishery products; • Upgrading of agrifood establishments to EU food safety standards though targeted investments; • Improved competitiveness of the food processing industry in the selected sectors in the single market;
Priority axis 2: • Better protection of natural resources in the beneficiary areas;
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• Development of practical experience with regard to the implementation of agricultural production methods designed to protect the environment and maintain the country side. • Improved participation of local actors in the development and implementation of rural development strategies.
Priority axis 3: • Improved competitiveness of beneficiary rural areas; • Improved quality of life of the beneficiary rural population; • Increased income of the beneficiary rural population through the development and diversification of on-farm and/or off-farm activities; • Creation of new employment opportunities through the development and diversification of on-farm and/or off-farm activities; • Better access to training in rural areas
Indicators to measure the results achieved under Component V during the monitoring and evaluation process will be developed as part of the ex-ante evaluation of the multi-annual IPA Rural Development Component Programme.
5. Forms of assistance to be provided
Forms of agriculture and rural development related assistance
IPA funds under Component V will be implemented through a single multi-annual Rural Development Programme covering the entire period of 2007-2013 taking account of the related implementation requirements. The Programme will address the three main priority areas and a selected set of measures under each of those areas.
It is expected that a large number of applications will be generated under the rural development component of the IPA which will require sound management of a substantial number of projects. As under all agricultural and rural development programmes, such projects are generally relatively small because of the size of the beneficiaries. Consequently, the IPA Rural Development Programme will be implemented by the beneficiary country in the framework of a system which is fully decentralised subsequent to an ex-ante audit performed by the Commission prior to the conferral of management of aid and with ex-post control by the Commission in the following. Financial assistance under Component V will be consistent with the principles applied to EU rural development programmes.
Assistance will mainly be granted in the form of support for private investments undertaken by natural or legal persons like farmers, food processing and marketing enterprises, co- operatives, producer unions etc.
Institutional set-up for the implementation of the assistance to be provided under Component V The institutional set-up for the IPARD assistance in Croatia will substantially rely on the structure which has been set up for SAPARD. Croatia has already designated the Directorate for Sustainable Development of Rural Areas in the Ministry of Agriculture, Forestry, and Water Management (nowadays the Managing Authority for SAPARD programme) as the Managing Authority being responsible for the
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elaboration of an IPA Rural Development Programme, the efficiency and correctness of the related co-ordination as well as for reporting on the monitoring and evaluation of the Programme. Monitoring will be ensured through a sectoral Monitoring Committee appointed by Croatia. The Programme, following the rules of the IPA legal framework, will be subject to ex-ante, interim and ex-post evaluation. The Programme will be implemented by the Beneficiary Country through structures according to the rules laid down in the IPA legal framework. Croatia has already designated the Directorate for Market and Structural Support in Agriculture (nowadays the SAPARD Agency) to be in charge for the implementation of the rural development assistance. The Commission will control that the funds are used in accordance with the applicable rules, inter alia by applying clearance of accounts procedures and financial correction mechanisms. Such management is very similar to that applied in Member States and contributes directly, and in a practical manner, to preparing for accession through administrative capacity building.
6. Financial indications
Priority axis 1: A minimum of 60% of the overall allocation for Croatia under the rural development component should be allocated to the sustainable adaptation of the agricultural sector and the related implementation of the acquis communautaire.
Priority axis 2: A minimum of 3% of the overall allocation for Croatia under the rural development component should be allocated to prepare for the implementation of the agri- environmental measures and Leader
Priority axis 3: A minimum of 20% of the overall allocation for Croatia under the rural development component should be allocated to the sustainable development of rural areas.
Table 10: Financial indications – Component V Priority 1 Min. 60% Priority 2 Min. 3% Priority 3 Min. 20%
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INDICATIVE ALLOCATIONS TO MAIN AREAS OF INTERVENTION
Republic of Croatia
Component I (Transition Assistance and Institution Building)
Political criteria 10 % - 20 %
Economic criteria 05 % - 15 %
Ability to assume the obligations of membership 50 % - 70 %
Supporting Programmes 10 % - 20 %
Component II (Cross-Border Co-operation)
Croatia - Slovenia 19.5 %
Croatia - Hungary 15.9 %
IPA Adriatic CBC 44.4 %
CBC with neighbouring potential Candidate Countries 20.1 % and ERDF transnational and interregional programmes
Component III (Regional Development)
Environment programme 35 % - 40 %
Transport programme 35 % - 40 %
Regional competitiveness programme 20 % - 30 %
Component IV (Human Resources Development)
Attracting and retaining more people in employment 30 % - 40 %
Improving adaptability of enterprises and workers 20 % - 30 %
Increasing human capital investment 30 % - 40 %
Strengthening administrative capacity 10 % - 20 %
Component V (Rural Development)
Priority 1 Min 60 %
Priority 2 Min 3 %
Priority 3 Min 20 %
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Annex A
CROSS CUTTING ISSUES
The major cross cutting issues to be tackled in the Republic of Croatia are: − Civil Society will be supported by the European Initiative for Human Rights and Democracy and the IPA financial framework. Civil Society is understood as including employers' organisations, trade unions, associations of local self-governments as well as any other non-governmental organisation. A justified balance has to be kept between Western Balkans' regional activities for civil society and specific activities along the national IPA programmes. − Environmental considerations will duly be reflected in all IPA financed activities, in particular for projects requiring Environmental impact assessment. − Equal opportunities and non-discrimination will be respected as regards gender as well as minorities and vulnerable groups at the programming and implementation stage, particularly in relation to socio-economic support programmes. − Furthermore minority and vulnerable groups' concerns will be reflected in all activities programmed under IPA, in particular when it concerns public services, legislative matters and socio-economic development. − Specific action instruments for the good governance, with particular attention to fight against corruption, will be incorporated on a horizontal basis.
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REPUBLIC OF CROATIA MINISTRY OF THE SEA, TOURISM, TRANSPORT AND DEVELOPMENT
TRANSPORT OPERATIONAL PROGRAMME 2007-2009 INSTRUMENT FOR PRE-ACCESSION ASSISTANCE 2007HR16IPO002 September 2007
Republic of Croatia – Integral Part of the Greater European Transport Network
2
TABLE OF CONTENTS
1. CONTEXT, CONSULTATION AND COORDINATION ...... 10 1.1 NATIONAL POLICY AND SOCIO-ECONOMIC CONTEXT...... 10 1.1.1. Economic and social indicators...... 10 1.1.2. Policy expectations in the short to medium term period ...... 12 1.1.3. Implications for Croatian transport policy...... 13 1.1.4. Transport Policy Framework...... 14 1.1.5. Institutional Framework...... 19 1.1.6. National legal framework of transport...... 20 1.1.7. Statistics...... 22 1.2 COMMUNITY STRATEGIC FRAMEWORK...... 22 1.2.1. Consistency with relevant strategic documents...... 22 1.2.2. Progress towards assuming EU membership responsibilities in transport ...... 25 1.2.3. Concentration of assistance...... 27 1.3 PARTNERSHIP CONSULTATION...... 29 1.4. EX ANTE EVALUATION...... 31 2. ASSESSMENT OF MEDIUM TERM NEEDS, OBJECTIVES AND STRATEGIC PRIORITIES ...... 33 2.1. SOCIO- ECONOMIC ANALYSIS (INCLUDING SWOT) ...... 33 2.1.1. General infrastructure and transport situation...... 33 2.1.2. Traffic Characteristics and Modal Split ...... 43 2.1.3. SWOT analysis ...... 48 2.1.4. Medium term needs and objectives in the Railway...... 53 2.1.5. Medium term needs and objectives in the River Transport...... 54 2.2. STRATEGIC PRIORITIES...... 55 3. PROGRAMME STRATEGY...... 56 3.1. PRIORITY AXES AND MEASURES ...... 56 3.1.1. IPA objectives and priority axes...... 56 3.1.2 Selection criteria ...... 56 3.1.3 Priority axis 1 - Upgrading Croatia’s rail transport system...... 58 3.1.4. Priority axis 2 - Upgrading Croatia’s inland waterway system ...... 63 3.2. PRIORITY AXIS 3 – TECHNICAL ASSISTANCE...... 68 3.3. HORIZONTAL ISSUES ...... 71 3.3.1. Equal opportunities for men and women...... 71 3.3.2. Sustainable transport ...... 71 3.3.3. Transport safety and environment...... 71 3.3.4. Equal provision of transport services...... 73 3.3.5. Balanced modal split between modes of transport...... 73 3.3.6. Energy-efficient transport...... 73 3.3.7. Participation of civil society and geographical, sectoral and thematic concentration...... 74 3.4. COMPLEMENTARY AND SYNERGIES WITH OTHER FORMS OF ASSISTANCE ...... 74 3.4.1. Complementarities and synergies with other SCF OP...... 74 3.4.2. Complementarity and synergies with other IPA components ...... 75 3.4.3. Complementarity with other EU assistance ...... 76 3.4.4. Other related donor interventions ...... 78 3.4.5 Supplementary MSTTD Activities ...... 78 3.5. INDICATIVE LIST OF MAJOR PROJECTS (2007 -2009)...... 79 4. INDICATIVE FINANCIAL TABLES...... 84 5. IMPLEMENTATION PROVISIONS...... 88 5.1 MANAGEMENT AND CONTROL STRUCTURES...... 88 5.1.1 Bodies and authorities ...... 88 5.1.2 Separation of functions ...... 93
3 5.2. MONITORING AND EVALUATION...... 93 5.2.2 Management Information System...... 94 5.2.3 Monitoring System and Indicators...... 95 5.2.4 Selection of operations ...... 95 5.2.5 Sectoral annual and final reports on implementation...... 96 5.2.6 Evaluation arrangements...... 96 5.3 INFORMATION AND PUBLICITY...... 97 5.3.1 Introduction ...... 97 5.3.2 Requirements...... 97 5.3.3 Activities...... 98 5.3.4 Indicative budget...... 98 5.3.5 Management and implementation...... 98 5.3.6 Monitoring, evaluation and reporting...... 99 5.3.7 Partnership and networking ...... 99 5.3.8 Internet...... 99 ANNEX 1: MEMBERSHIP OF INTER-MINISTERIAL WORKING GROUP (IWG) ...... 101 ANNEX 2: INDICATIVE LIST OF PROJECTS AND THEIR IDENTIFICATION CARDS...... 102 ANNEX 3: DIAGRAM OF THE TOP INSTITUTIONAL STRUCTURE...... 116 ANNEX 4: SEE CORE REGIONAL NETWORK ACTION PLAN ...... 117 ANNEX 5: DETAILS ON PARTNERSHIP CONSULTATIONS...... 119
4 GLOSSARY OF ABBREVIATIONS
AADT Average annual daily traffic AGC European Agreement on Main International Railway Lines AGN European Agreement on Main Inland Waterways of International Importance AGTC European Agreement on Important International Combined Transport Lines and Related Installations AP Accession Partnership ASDT Average summer daily traffic ATP Automatic train protocol CARDS Community Assistance for Reconstruction, Development and Stabilisation CBS Central Bureau of Statistics CFCU Central Finance and Contracting Unit CODEF Central Office for Development Strategy and Coordination of EU Funds COTIF Convention concerning International Carriage by Rail CRO-NEN Croatian National Ecological Network DG Directorate-General DG TREN EC Directorate-General for Transport and Energy EC European Commission EIA Environment Impact Assessment EIB European Investment Bank EIRR Economic internal rate of return EU European Union EUR Euro FIRR Financial internal rate of return GDP Gross Domestic Product GHG Greenhouse gas emissions HLG High level group IFI International financial institution IPA Instrument for Pre-Accession Assistance IWG Inter-ministerial working group km kilometre km2 square kilometre M million MAP Multi-annual plan MIPD Multi-Annual Indicative Planning Document MSTTD Ministry of Sea, Tourism, Transport and Development NGO Non-Governmental Organisation NUTS French - nomenclature des unités territoriales statistiques - Nomenclature of Territorial Units for Statistics OG Official Gazette OP Operational Programme OTIF Intergovernmental Organisation for International Carriage by Rail PEP Pre-accession Economic Programme PPP Purchasing Power Parity RCOP Regional Competitiveness Operational Programme REBIS Regional Balkans Infrastructure Study RoC Republic of Croatia SAA Stabilisation and Association Agreement SCF Strategic Coherence Framework SCI Sites of Community Interest SDF Strategic Development Framework for 2006-2013 SEETO South East Europe Transport Observatory SME Small and Medium Enterprises SWOT Strengths-Weaknesses-Opportunities-Threats
5 TA Technical Assistance TEN-T Trans-European Network for Transport TER Trans-European Railway Project TINA Transport Infrastructure Needs Assessment TIRS Transport Infrastructure Regional Study for Balkans TOP Operational Programme for Transport UN United Nations UN-ECE United Nations Economic Commission for Europe
6 INTRODUCTION
The Republic of Croatia is one of three candidate countries currently preparing for EU accession. It attained the status of accession country in June 2004 and accession negotiations were opened with Croatia in October 2005.
Croatia currently benefits from various pre-accession financial instruments provided by the European Union, relevant to the transport sector, namely ISPA (Instrument for Structural Policies for Pre-Accession) for transport and environment, and Phare for institution-building and economic and social cohesion.
From 2007, the ISPA programme has been replaced by IPA (Instrument for Pre-Accession Assistance). In order to ensure an uninterrupted structural adjustment process in the transport sector and the utilisation of the finance under IPA Component III – Regional Development, Croatia has drafted a Transport Operational Programme (TOP). The TOP covers a three-year rolling period (2007-2009), building on the initiatives funded by previous EU programmes, particularly ISPA. It also offers an outlook on the programming period after 2009.
The present Operational Programme for the 2007-2009 period covers key issues and information, such as general policy and socio-economic context, transport policy background, status of transposition of EU transport acquis into national legislation, transport sector assessment and subsequently, strategies and measures to meet transport sector development needs in line with accession requirements, including indicators to monitor and assess the implementation of the TOP.
Transport infrastructure development is considered essential for economic and social development and the promotion of inter-regional exchange. It is an instrument of regional development, facilitating the flow of goods, as well as the access of people to employment, health, education and recreation. Former experience in the framework of EU enlargement demonstrates that improved rural / regional access and links to the arterial network, particularly among peripheral regions, is necessary for economic and social cohesion and the alleviation of regional disparities.
Croatia is intersected by Pan-European transport corridors V, VII and X and their branches. Due to its geographic position, the Republic of Croatia is highly significant in terms of the establishment of effective links between the Western Europe and the Balkans, and in terms of the connection between the Central Europe area and the Adriatic Sea and the Mediterranean.
The Transport Operational Programme for 2007-2009 reflects the guiding principles of the Commission’s Multi- annual Indicative Planning Document (MIPD)1 which is the strategic document for IPA. It also directly relates to one of the priorities set out in Croatia’s Strategic Coherence Framework (SCF)2 and reflects EU and national transport sector development policies.
To achieve transport sustainability a holistic planning approach - taking into consideration the entire transport system (all modes) - has been taken in the drafting of the present TOP. This approach has been taken to ensure that the policies adopted in the various transport sub-sectors (modes) are well coordinated and complement existing EU, IFI and other assistance, and hence, that the respective implementation measures are mutually beneficial.
The medium-term assessment of needs and objectives shows that the existing network of primary roads, sea ports, motorways and aviation in Croatia is comparatively well-developed and provides good area coverage, but suggests that there is a clear backlog of infrastructure rehabilitation and modernisation in the railway and inland waterways sub-sectors, both of which have lost out heavily in the share of the transport market.
1 MIPD, C(2007) 2566 of 20/06/2007 2 Strategic Coherence Framework (SCF), adopted by the Croatian Government on 25/5/2007, adopted by the EC on 18/6/2007, http://www.strategija.hr/fgs.axd?id=451
7 In order to guarantee the development of a balanced network that includes all modes of transport, the 2007-2009 TOP focuses on the railway and inland waterways sub-sectors, with the ultimate goal of achieving acceptable standards and network coverage, improving interoperability and strengthening inter-modal competitiveness.
The TOP’s strategy for the development of the railway and inland waterways sub-sectors is consistent with the strategic priorities for the sub-sectors expressed in earlier regional development studies, particularly the most recently adopted South-East Europe Core Regional Transport Network Development Plan 2007-2011.3
With regard to the railway sub-sector, the measures and projects proposed by the TOP are the logical continuation of current ISPA railway rehabilitation measures carried out on Rail Corridor X, which cover the modernisation of the section of the line from Vinkovci to Tovarnik, and from Tovarnik to the Eastern State Border. Moreover, the railway priority projects included in the indicative project list for the period 2007-2009 address the weakest sections of rail corridor, in terms of operational standards.
Concerning the inland waterway sub-sector, although there is an urgent need for rehabilitation work to be carried out in the sub-sector, no sufficiently mature projects are available at this moment in time to be presented for IPA funding in the 2007-2009 period. It is, however, expected that the ongoing pre-feasibility study conducted by the Sava River Commission will result in viable project proposals which will then be addressed in the 2010-2013 programming period. Moreover, technical assistance is foreseen for the preparation of the Vukovar port project.
Apart from the Zagreb Main Station Signalling and Interlocking System project, which is already in an advanced preparation phase, other identified Corridor X railway priority projects are generally at an early stage of project preparation and lack the required financial/economic project viability assessment, technical detailed specification and environmental impact analysis and financial engineering. The preparations of projects, as well as the use of the technical assistance to reinforce administrative capacity for implementation of financial assistance delivered under the present TOP, are therefore future priorities.
The measures and projects proposed for co-funding under IPA will be of a sufficient scale to have a measurable effect on the improvement of Croatia’s transport network and administration, which will be assessed through monitoring indicators.
Community assistance under IPA takes the form of non-repayable direct assistance. The total co-financing is determined by the Multi-Annual Indicative Financial Framework (MIFF)4 for the Instrument of Pre-Accession Assistance (IPA), which is designed to provide information on the indicative breakdown of the overall IPA envelope proposed by the Commission in accordance with article 5 of the IPA Regulation (EC) 1085/2006. The EU co-financing amounts altogether to € 53,500,500 for the three year period of the present TOP, equivalent to EU co-financing rate of 75%.
The expected overall impact of the TOP is the following:
9 Development benefits - assistance in achievement of EU transport acquis related and international standards; management of change in the volume of travel on Pan-European railway corridor X; and
9 Learning benefits - equipping Croatia with the institutional capacity to manage Structural Funds-type interventions in the transport sector; this capacity will give the institutions involved valuable experience in preparation for eventual EU membership and its associated responsibilities.
The operational objectives of the Operational Programme for 2007-09 are to:
• Increase/improve inter-operability along Railway Corridor X • Improve railway services quality, reliability and efficiency along Corridor X; • Preparation of projects for railway corridor X;
3 SEETO, South-East Europe Core Regional Transport Network Development Plan MAP 2007-2011. November 2006 4 Multi-Annual Indicative Financial Framework for 2008-2010, Brussels, 8.11.2006, COM(2006) 672 final
8 • Preparation of projects to rehabilitate the Sava river waterway, by making navigational improvements to bring the waterway closer to international IV category navigation status; • Preparation of Vukovar port project • By means of Technical Assistance, support the implementation of the OP and the strengthening of relevant institutions.
The following table shows at a glance the main elements of the TOP for the period under review, presented according to the “priority axis – operational objective – measure” logic, which is central to the indicative project selection undertaken in the present TOP.
Operational Programme for Transport 2007-2009: AT A GLANCE
Medium-term Priority Axes TOP operational Delivered through projects under the needs objective following measures:
Increase railway 1 - Upgrading Increase/ improve - Line up-grading and modernisation efficiency, reliability Croatia’s rail interoperability - Improvement of the safety and and transport system along Rail Corridor efficiency of railway operations competitiveness X; Improve railway services quality, reliability and efficiency along Corridor X Upgrade port 2 - Upgrading Rehabilitate the - Modernisation and rehabilitation of infrastructure and Croatia’s inland port of Vukovar river waterways and port improve navigation waterway system and the Sava river infrastructure standards waterway - navigational improvements towards category IV navigational status Manage the OP 3 – Technical Use of EU - Programme management and and institutional assistance assistance in a capacity-building and activities strengthening timely and connected with future project technically identification acceptable manner
To determine the final order in which the various interventions will be implemented, measures will be subject to a further detailed analysis, taking into account the IPA criteria. It is proposed that this further analysis takes the form of feasibility screening, sensitivity tests and ranking of the projects in order of suggested implementation.
9 1. CONTEXT, CONSULTATION AND COORDINATION
1.1 NATIONAL POLICY AND SOCIO-ECONOMIC CONTEXT
This section reviews the key economic statistics and trends relative to Croatia and their implications for national transport policy. It then reviews the hierarchy of the strategy documents which govern transport policy in Croatia from the Strategic Development Framework (SDF)5 through to the Transport Development Strategy Paper and other relevant sector strategies, to the specific investment and sub-sector management strategies and the National ISPA Transport Strategy6. It then summarises the key public institutions tasked with developing and implementing these strategies. Finally, it describes the status of Croatia’s own legal framework in relation to the transport sector.
1.1.1 Economic and social indicators7
The independent state of the Republic of Croatia has a population of 4.44 million (the latest available estimates for 2006) currently at a zero growth-rate, and a surface area of 56.5 thousand sq. km, comprising 1246 islands.
The geographical shape of the Republic of Croatia and its territorial connection to both northern lowland transport routes and to the eastern coast of the Adriatic Sea, highlights the vital significance of transport infrastructure for national development, and the need to establish efficient inland and sea connections with South-Eastern and Central European countries, and through the territory of Croatia.
The Republic of Croatia is characterised by a significant concentration of population in a few regional centres. The highest population density is in the Capital City of Zagreb, 7.5 times higher than that of the county with the second highest concentration (Međimurje), and 15.5 times higher than the Croatian average (78.4 inhabitants/km2). The particular geographical shape and population distribution of the country impacts on the development of transport infrastructure and services.
As regards recent macro-economic developments, following the implementation of the stabilisation programme in 1993, which was aimed primarily at halting hyperinflationary trends, the Croatian economy had an established record of relatively stable growth and low inflation.
After the war, increased private consumption, recovering tourism, large investments (mainly in road construction) and a recovery in exports brought the Croatian economy, in the year 2000, back to positive real GDP growth rates (2.9%), growing to 4.8 % in 2006.
Expressed in current prices, GDP per capita reached 7,037 EUR in 2005 and 7,704 EUR in 2006. According to first releases of Eurostat, in 2006, GDP p.c. measured by the PPP was close to 50% of the EU-27 average8 while preliminary estimates with the grey economy included, point towards the level of income close to 60% of the EU-27 average.
Since 2004, the Government has reduced the fiscal deficit, improved transparency and the budgeting processes. Fiscal performance is reflected in the net reduction of the fiscal deficit from 4.8% of GDP in 2004 to 4.0% of GDP in 2005. In 2006, fiscal deficit fell further to 3% of GDP. Such a performance is mainly based on strong revenue growth caused by vigorous economic performance and increased efficiency of the Tax Administration in the collection of taxes as well as the moderation in spending. According to the Economic and Fiscal Policy Guidelines 2008-2010, in 2007 Croatian Government aims to further decrease fiscal deficit to 2.6% of GDP.
5 SDF, Adopted by the Croatian Government on 3 August 2006, http://www.strategija.hr/fgs.axd?id=230 6 National ISPA Strategy for Transport, Adopted by the Ministry of Sea, Tourism, Transport and Development on 15/12/2005 7 Statistical data used in the document are those available in August 2007 8 However, Croatian and EU statistics are not fully comparable since Croatia does not adjust GDP figures for the effects of grey economy.
10 Picture 1 - Croatia's Traffic and Development Axes
Croatia has had low inflation rates since 1994. Since then, average annual consumer price inflation amounted to 3.4%. It increased considerably from 2.1% in 2004 to 3.3% in 2005 and fell to 3.2% in 2006. Inflation remained stable and relatively low due to several factors; appreciation of the HRK/EUR exchange rate, slow nominal wage increase, mild labour productivity growth, and intense competition in the retail trade.
The lasting track-record of low inflation is underpinned by the monetary policy determined by the Croatian National Bank whose primary objective has been low inflation. It is being supported by the stable exchange rate through the “managed float regime”. In the period between 2001 and 2006, fluctuations in the average monthly HRK/EUR exchange rate have not exceeded a narrow +/-4% band. In the context of high euroisation within the Croatian financial system, the Croatian Central Bank is continuing to tightly manage the EUR/HRK exchange rate, as it is the key instrument for curbing inflationary expectations in the country, and also influences the price stability of imports from the euro-zone.
The unemployment rate, measured according to ILO labour survey methodology, has continued to decline steadily. In 2000 the unemployment figure measured by the Labour Force Survey stood at 16.1%; this figure had fallen to 12.7% by 2005. In 2006 it declined to 11.2%. In 2005 the average nominal net wage totalled 599, 5 euros and in 2006 it increased to 630,5 euros. The service sector is the leading sector for job creation in Croatia. In 2006 the labour market revealed positive trends, but improvement is still needed in this area, particularly in relation to the gaps between demand and supply in the labour market.
11 Public debt is below the Maastricht criterion of 60%. General government debt amounted to 40.8% of nominal GDP at the end of 2006; while public sector debt (total general government debt including issued government guarantees) totalled 46.4% of GDP in nominal terms at the end of 2006.
However, Croatia is currently faced with challenges in the context of external vulnerability. The annual current account deficit rose from 5.1% of GDP in 2004, to 6.4% of GDP in 2005, increasing to 7.8% of GDP in 2006. Generally speaking, the deficit was caused by a lower growth in manufacturing exports and increased growth in merchandise imports compared to last year, and by higher net factor payments to non-residents; tourism revenue traditionally contributed to the surplus in services. A continuous savings-investment gap led to high external debt which, at the end of 2006 amounted to 29.2 bln EUR, while the ratio of external debt to GDP stood at 85.3%. In order to reduce external vulnerability and external public debt, the Government last year increased borrowing, primarily through issuing bonds and treasury bills, and taking loans on the domestic market, thereby lowering its share of total external debt from 31.6% in 2004 to 22.8% in 2006. Consequently, the increase in the external debt was driven mostly by the external borrowing of other sectors (among which, commercial banks and domestic enterprises).
Regarding structural reforms, various positive steps have been taken; however, these steps must be reinforced in order to further improve economic performance. In order to improve the climate for business, Croatian authorities introduced a series of measures e.g. the introduction of e-Government – a service intended to speed up and improve communication between the Government, the business community and citizens; the expansion of hitro.hr (one-stop- shops) intended to reduce the time necessary to start up a company or a craft; electronic registration of crafts, electronic submission of specifications for payment of compulsory contributions per insured person; access to data from the land registry, the content of which has been expanded with cadastral data; and, the electronic submission of VAT applications for commercial entities. Further positive examples include the establishment of entrepreneurial zones, a project focusing on streamlining and simplifying the legal framework connected with doing business in Croatia (regulatory guillotine), and the development of incentives to decrease tax burden of legal entities through reduction of “hidden fees”. Furthermore, a reform of health-care financing is under way, as well as a reform of social welfare focused on consolidation of various social benefits and the simplification and better targeting of the whole system. The banking sector is growing steadily, while the agency for supervision of non-banking financial sector was established at the beginning of 2006. Further privatisation of the state oil company INA was performed through an initial public offering of 15% of all its stocks. Capital markets have recorded a strong growth – the equity index of the Zagreb stock exchange, CROBEX, grew 60.7% during 2006. The merger of Zagreb and Varaždin stock exchanges, executed at the beginning of 2007, should result in further opportunities for the development of the non-banking sector within the financial system.
In spite of these positive trends, many serious issues still remain to be tackled. Further improvement of the business climate cannot be achieved without the continuous cutting of red-tape, the streamlining and vigorous modernisation of the state administration, the reform of justice and the fight against corruption; all of which should contribute to the enforcement of market entry and exit, as well as to the enforcement of creditor and property rights. Restructuring and privatisation efforts should be continued, particularly in the area of shipbuilding, as well as in the context of the remaining state-owned tourist companies.
1.1.2 Policy expectations in the short to medium term period
The key challenges in the next three years will remain the tackling the external vulnerability, the realisation of structural reforms and further fiscal consolidation. This is especially important in the context of high costs connected with the accession process, the exact measure and level of which will be defined in more detail as the negotiation process continues and the exact requirements become clearer.
According to the Pre-accession Economic Programme 2007 – 20099, and Economic and Fiscal Policy Guidelines 2008-2010, adopted by the Government at the end of 2006 and mid 2007 respectively, the Government plans a set of policy measures aimed at reducing public deficit, public debt and external debt as well as reinvigorating the privatisation process. On the expenditure side, it will continue with the planned reform of the health insurance and social benefits, and the planned reforms in the area of privatisation of large state-owned enterprises. In order to
9 PEP, Adopted by the Croatian Government on 30/11/2006
12 develop a domestic yield curve and to reduce external vulnerability, the Government will continue primarily borrowing on the domestic market. On the income side, it plans to step up reforms in the process of tax collection in order to improve its efficiency. The foreseen structural reforms should result in the reduction of general government expenditure according to GFS 1986 methodology (from 47.8% of GDP in 2006 to 43.1% of GDP in 2010), as well as the reduction of general government deficit from 3.0 of GDP in 2006 to 0.5% of GDP in 2010. Furthermore, the reduction of public debt (sum of the general government debt and guarantees) is projected from 46.4% of GDP in 2006 to 37.1% of GDP in 2010 (source: Economic and Fiscal Policy Guidelines 2008-2010). Monitoring of the International Monetary Fund will be limited to the Article IV consultations, which are to take place once a year; however, it is expected that the monitoring of the European Union will become more intense as the accession process goes on. The Government plans to establish policy credibility by moving forward with fiscal consolidation and necessary structural reforms, but of outmost importance is creating a business-friendly environment that will turn investment interest into actual projects and create new jobs.
1.1.3 Implications for Croatian transport policy
The Republic of Croatia is today well-integrated into the international trade system. Due to the progress which has been made on the realisation of major reform programmes and investments, Croatia is generally considered to be a functioning market economy “able to cope with the competitive pressure and market forces within the European Union”, as most recently confirmed by the European Commission10.
Transport policy has an important contribution to make to both enhancing the growth of Croatia and addressing regional disparities between counties. For example, GDP per capita in the least developed counties of Vukovar–Sirmium and Brod- Posavina amounts to only 57.5% of the weighted national average, and is correlated with a very high unemployment rate, far above average.11 Development bottlenecks, characteristic for areas lagging behind the national development average, include poor transport and technological infrastructure. General experience from elsewhere in Europe is that lack of accessibility contributes to depopulation trends and social exclusion, low skills bases, long-term unemployment, and an ageing population structure.
The adequate provision of “public transport services”, including railways, is considered an important ingredient for the improvement of the socio-economic situation of under-developed areas, and will have to be balanced against the arguments for closing loss-making lines.
The challenge of reform and investment continues in the transport sector, particularly in the context of negotiations for accession to the EU, where transport is highly liberalised, competitive and market-oriented.
In light of ongoing fiscal consolidation, Croatia has employed innovative financial solutions to meet future investment demands, especially in the infrastructure sector. One option is to use public finance to lever in IFI and private capital for infrastructure investment, a strategy adopted by the Government in the motorway and ports sector.
Privatisation, in the sense of outsourcing of non-core activities, is an issue for the state owned Croatian Railways Group. The former company Croatian Railways Ltd. underwent restructuring which resulted in five main companies and a number of dependant companies. In fact, respective privatisation measures have already been programmed under the IBRD’s PAL II loan.
Apart from the increased competition to be expected from EU integration, future transport development policy will need to take proper account of several macro-economic effects which can be expected to strongly impact on Croatian transport sector investments and services such as:
• Increased “Europeanisation “ of the transport business and hence, the growing importance of national and international alliances, which implies closer cooperation between railway undertakings, complementary modes of transport and industries;
10 EC Croatia 2005 Progress Report (COM(2005)561 final) 11 Strategic Coherence Framework (SCF), adopted by the Croatian Government on 25/5/2007, adopted by the EC on 18/6/2007, http://www.strategija.hr/fgs.axd?id=451
13 • Diversification of services in response to continuous changes in the pattern of trade, or in the commodity structure, towards an increasingly higher value-added production system;
• Increased specialisation, due to the growth of the complex system of “logistics chain management”, which is replacing the traditional system of distribution.
1.1.4. Transport Policy Framework
A multitude of internal as well as external policy documents and international initiatives determine the orientation of national transport policy in Croatia, as follows:
Transport infrastructure development
The central internal document is the Strategic Development Framework 2006-2013 (SDF)12, it sets the main starting points for the further development of infrastructure for the transport sector:
• To strengthen market mechanisms for the development and use of infrastructure, and • To develop a modern system of infrastructure management based on information technology, and a sustainable system for the financing of its construction and maintenance, and defines the main goals accordingly:
• to harmonise the degree of development, quality and security of the transport infrastructure • to promote ecological sustainability in transport and energy
The SDF also recalls the development priorities for transport formulated in the national “1999 Transport Development Strategy Paper “13, which in essence established the following priorities:
• Balanced development of the transport system as one of the basic goals relating to the overall creation of social and economic balance • Connecting the Republic of Croatia with its European and regional neighbours as the primary goal in relation to transport development as a function of international communication • Adaptation of networks to the new political and economic environment, and their modernisation in accordance with general developments in world transport • Reviewing the participation of individual transport sectors in the overall transport sector with the aim to effect the redistribution of traffic among transport routes and with a view towards inter-modality. • Orientation towards a higher level of safety in the transport sector • Increase of environmental awareness and the definition of environmental criteria for use in the transport sector.
The National ISPA Transport Strategy (2005)14 identifies the country's priority railway investment projects; this was the basis for Croatia’s investment planning for the use of 30M€ allocated to the country under the ISPA transport measure for the period 2005-2006 (more details in section 3.4.2.). These funds will make a limited contribution to meeting the full and substantial needs of Croatia in this policy area; however, the indicative list of projects in the National ISPA Strategy represent the priority investments for further investment in the railway sub-sector, which will contribute to meeting the goals for the upgrading of the railway network. The list has been up-dated with new priority projects (inland waterways) for IPA investments, and their state of readiness is described in section 3.5 of this TOP.
The Ministry has prepared drafts of an Inland Ports Five-Year Development Plan and an Inland Waterways Five- Year Development Plan, which are currently in the phase of inter-institutional consultation. The development strategy in relation to the infrastructure of inland waterways is targeted at increasing the safety and efficiency of inland
12 SDF, Adopted by the Croatian Government on 3 August 2006, http://www.strategija.hr/fgs.axd?id=230 13 Adopted by Croatian Parliament on 12t/11/1999 (OG 139/99) 14 National ISPA Strategy for Transport, Adopted by the Ministry of Sea, Tourism, Transport and Development on 15/12/2005
14 navigation. Waterway regulation must correspond with the needs of the users, which means ensuring smooth and safe navigation for ships with maximum draughts in accordance with the class of the waterway. In practice this means ensuring a minimum depth of 2.5 m for 300 days per year (international waterway class).
Croatian inland waterways are specific in that most of the waterways are rivers which follow Croatia’s borders. In consequence, the river bed regulation projects should be coordinated with neighbouring countries. Croatia considers these joint projects a priority, taking into account the fact that they help to establish better transport connections between countries, and help to create preconditions for joint economic prosperity.
Croatian river ports require qualitative and technological modernisation in order to satisfy the existing and expected transport demand. Along with the modernisation of the basic port infrastructure, the system of safety and surveillance in the port area should also be enhanced. Ports need to connect with main road and rail corridors in order to achieve better integration with the economic hinterland and to create preconditions for the development of inter-modal transport.
Environment policy related issues
The declared objective of the National Transport Strategy is to develop a transport sector which is in harmony with Croatian development needs, while also being internationally compatible, that is, integrated into the Pan-European transport structure. This approach takes into account overall objectives for the economic and social development of the Republic of Croatia, needs of future generations, and requirements relating to environmental protection, regional development and national defence. Transport policy in Croatia has long and well-established links to environment policy, which were developed to minimise the possible negative consequences of transport sector developments on the economy, society and the environment. Since 1980, environmental impact assessments (EIAs) have been obligatory prior to the issuance of location permits for all structures that might have adverse effects on the environment; transport structures fall within this category.
The basic determinants of these obligatory studies are:
• To enable the existence of plant and wild life species typical for Croatian bio-geographic conditions, • To approve the construction of new infrastructure projects based on good quality environmental information, checked and verified by the competent authority, in accordance with Croatian regulations.
In addition, the physical planning system used for land use planning and protection was developed in the 1970s. The primary document in the hierarchy of physical/area planning documents in this regard is “The Strategy and the Programme of Physical Planning of the Republic of Croatia”15, in which the entire road network of the country is set out and detailed at regional and county level. This Strategy and Programme must be approved by the Croatian Parliament after the conducting of a public hearing which includes also the environmental issues.
In the field of environmental protection, the Republic of Croatia is currently undergoing preparations for the transposition of procedures with respect to Strategic Environmental Assessments (SEA) of plans and programmes (Directive 2001/142/EC) into national legislation. This will be achieved by the adoption of a new Environmental Protection Act (adopted by the Government, using Parliamentary procedure).
Regarding the procedures and documentation that precede the construction of new permanent structures which could have possible adverse effects on the environment, the legislation of the Republic of Croatia on EIA and SEA is not yet fully in line with EU legislation. All projects financed under the TOP must fully comply with sustainable development principles and meet relevant environmental norms, in particular directives on EIA, Habitats and Birds (in order to avoid negative impacts on potential NATURA 2000 sites), and must comply with the relevant environmental acquis. Investments in the transport sector will be planned using integrated and strategic approaches. The projects to be financed must be appraised on a case by case basis in order to ensure their coherence with the relevant obligations of the environmental acquis.
15 Developed by the Ministry of Environmental Protection, Physical Planning and Construction (MEPPPC)
15 1.1.4.1. Greenhouse gas reduction
The Republic of Croatia ratified the Kyoto Protocol16 in May 2007. Aware of the commitments that the Kyoto Protocol entails, Croatia actively implemented projects that increase energy efficiency and promote the use of renewable energy sources, well in advance of its ratification of the Protocol.
The first wind farm (power of 5.9 MW) became operational in 2004, and the second wind farm (power of 11.2 MW) was completed in Gas emissions from traffic congestion have been reduced as 2006. It is planned that, by 2010, six wind farms will have been a result of the construction of the completed. Use of solar energy is being intensified, and projects on new motorway. the use of forest biomass for district heating and electricity production are in progress in several local communities.
In the transport sector, the continuing increase in the number of vehicles in Croatia has unavoidably resulted in the increase of greenhouse gas emissions.
The construction of the new motorways has resulted in the elimination of traffic congestion and excessive air pollution especially in the town of Karlovac, which had been a major bottleneck for traffic flows heading to the Adriatic coast. Furthermore, the planned construction of urban bypasses for the towns of Rijeka, Split, Karlovac, Varaždin, Osijek etc. will add to the already achieved reduction of greenhouse gas emissions.
It can be concluded that Croatia, with the exception of its urban centres, is still far from suffering traffic overload. Nevertheless, it can be expected that more difficult traffic conditions will develop, in parallel with the forecasted increase in traffic demand on the core network, especially during the tourist season.
In order to counteract possible negative consequences from increased road traffic, Croatia has already introduced a ban on the import of cars which are not in line with homologation standards. Further, an eco-test is part of the mandatory annual vehicle technical inspection, comprising the measurement of exhaust gas emissions from motor vehicles. Since 1 October 2004, the roadworthiness of a vehicle cannot be certified if the results obtained by the eco- test are unsatisfactory.
According to the National Inventory Report on GHG emissions for the period 1990-200417, the contribution of the transport sector to total GHG emissions in Croatia was 18% in 2004. Within the transport sector, the contribution of the road transport sub-sector is 94%.
For example, the regulation on the quality of biofuels, adopted by the Croatian Government in November 2005, sets a national indicative target of 5.75% for the share of biofuels, concerning petrol and diesel for transport purposes, to be placed on the domestic market by 31 December 2010. The first biodiesel processing plant with a design capacity of 20 000 tonnes/year has been opened in Ozalj.
Within this TOP, the specific interventions proposed for IPA co-financing and the indicative list of projects reflect the spirit of the Kyoto protocol, as they aim to acheive the rehabilitation of the railway system, and the improvement of the Sava river navigation system, with the final goal of promoting multi-modal transport and diverting traffic from road transport to energy efficient rail/river transport modes.
1.1.4.2. Ecological networking
NATURA 2000 is the guiding programme in respect of the EU nature conservation policy. It is implemented through the Habitats and Birds Directives. Each EU member contributes to the establishment of the NATURA 2000 network by determining special areas in accordance with the Habitats Directive.
16 Law on ratification of the Kyoto Protocol and the United Nations Framework Convention on Climate Change, OG International Agreements, 5/2007 17 National Inventory Report, Ordered and adopted by the Ministry of Environment Protection, Physical Planning and Construction, number 112-04/05-01/47, 531-05/02-vg-05-02, July 2005
16 The establishment of the habitat network within NATURE 2000 is carried out in three basic stages:
• The first stage is a scientific assessment of the level of risk and range of endangered habitats at a national level.
• In the second stage, each locality suggested on the national list is appraised by the European Commission in cooperation with the member state. After the appraisal, and the selection of «European importance» Sites of Community Interest (SCI), a final decision is made by the EU Council of Ministers.
• Once the SCI is defined, the member state must proclaim it a ‘Special Area of Conservation’.
In 2002, as part of the accession process to the EU (and within the Stabilisation and Association Agreement)18, Croatia joined the establishment of the National Ecological network, as a part of the Pan-European Ecological Network and the NATURA 2000 network, through the CRO - NEN project. As of now, the first draft of the project has been completed.
Organised and institutionalised care of nature conservation existed in Croatia even before the introduction of NATURA 2000. According to its national legislation, Croatia has the following protected areas: 8 national parks, 6 nature parks, 2 strict reserves, 69 special reserves, 23 park forests, 28 protected landscapes, 72 nature monuments, 114 park architecture monuments, with a total surface area of approximately 500,000 ha. When planning transport alignments, all the above mentioned areas must be strictly preserved and there is a strict duty to adjust the transport infrastructure alignments to nature conservation requests.
Specific transport projects for both the ISPA and IPA programmes will be subject to checks by the competent authority in Croatia, regarding the suggested areas of the National Ecological Network (CRO – NEN).
1.1.4.3. Regional Policy Background
The international community has been continuously faced with new challenges in recent years, firstly as a result of geo-political changes and the creation of new nation states in Europe's south-east, and most recently as a result of the 2004 and 2006 EU enlargement from 15 to 25 and 27 members respectively. These developments have made it necessary for the international community to:
• Devise a new concept of pan-European transport routes / corridors, taking into account the new candidate countries for EU accession and new EU neighbours, as well as the diverse economic policies of these countries "in transition";
• Assist the new EU candidates and new EU neighbours in their integration into the extended TEN-T corridor network, and
• Provide guidance concerning the gradual adoption of EU legal provisions (acquis communautaire) in the field of transport, aimed at the realisation of the four freedoms 19 as the cornerstones of the internal EU market.
The inclusion of the Republic of Croatia into the wider European transport network dates back to the Third Pan- European Transport Conference, held in Helsinki in June 1997, when 10 Pan-European multimodal corridors were complemented20 by segments of these corridors in the territory of countries situated at the south-east of Europe, including Croatia’s sections of Corridor X and Corridor VII (Danube river), as well as of the Corridor branches Xa, Vb and Vc.
18 SAA, approved by EU on 13/12/2004, Council and Commission decision 2005/40/EC, Euratom 19 Free movement of goods, services, capital and people 20 The X corridor was added as well as the Pan-European Transport Areas for maritime basins.
17 The first concrete initiative in favour of the formation of a South-East Europe regional transport network was the EC strategy paper, prepared in 2001, entitled “Transport and Energy Infrastructure in South Eastern Europe”21. It was followed by the “Transport Infrastructure Regional Study for Balkans” (TIRS) financed by the French Government22. The TIRS study focused on seven countries, the five of the 2001 EC study plus Romania and Bulgaria, and was supervised by the European Conference of Transport Ministers. Finally, there followed the „Regional Balkans Infrastructure Study" (REBIS) in 2002/3, financed again by the European Commission. This later study proposed a Core Network of regional importance based on the strategic network previously established by the European Commission. Based on the TINA23 methodology, REBIS selected and evaluated priority projects for all modes and countries concerned for the period up to 2015.
EU enlargement brought about It is worthwhile mentioning at this point that it is intended to use the TINA a new dimension of methodology in the preparation of the detailed evaluations of TOP infrastructure planning and priority projects contained in the indicative project list, to ensure an regional network integration. internationally harmonised planning strategy, and to facilitate the mobilisation of possible project finance by international financing institutions.
Also in 2003, the “Framework Agreement on the Sava River Basin” was concluded by Slovenia, Croatia, Bosnia and Herzegovina and former Serbia and Montenegro, by which all the connected states pledged to participate, through the framework of a joint body, the Sava River Commission, in coordinated activities concerning water resource management, river navigation and protection of the environment and business. The Agreement emphasises inter alia the inter-modal use of navigation routes and the establishment of an international regime of navigation on the Sava River and its navigable tributaries.
Following the EU enlargement from 15 to 25 members on May 1st, 2004, roughly two thirds of the former Pan- European corridors became part of the inner European transport network. The task of reviewing the Pan-European transport network, taking into consideration the requirements of candidate countries and the new European neighbours was assigned to the High Level Group (HLG) “on the extension of the major trans-European transport axes to the neighbouring countries and regions”. It was composed of the 25 EU member states plus Bulgaria and Romania, the EU neighbouring countries, the European Investment Bank, the European Bank for Reconstruction and Development and the World Bank. The Group was led by Mrs. Loyola de Palacio, former EC Vice-President.
Based on the work of a Ministerial Meeting held in Santiago de Compostela (Spain) in June 2004, the HLG determined five major trans-national axes, whereby the South-East multi-modal transport axis links the EU, via the Balkans and Turkey, to the Caucasus and the Caspian Sea as well as to Egypt and the Red Sea. The Group published the “Network for Peace and Development” in late 2005.
In terms of fostering regional cooperation in the Balkans area, the multilateral "Memorandum of Understanding (MoU) on the Development of the South East Europe Core Regional Network" was signed on 11 June 2004 in Luxembourg.
According to the MoU: “the development of the network should include maintenance, reconstruction, rehabilitation, upgrading and new construction of main and ancillary infrastructure as well as its operation and use with a view to fostering the most efficient and environmentally friendly transport modes on a regional scale. Thus, both infrastructure and related services, including administrative and regulatory procedures, are within the scope of the Memorandum.”
The MoU has made co-operation possible at a multilateral level for the South East Europe region. It institutionalised the term “Core Network” of transport. In order to put into effect the ideas defined in the MoU, the South East Europe Transport Observatory – SEETO was founded with its seat in Belgrade. It fulfils two functions: technical secretariat and body for collecting/ updating information concerning the “Core Network”. The MoU foresees regular meetings at ministerial level and the exchange of information through a Steering Committee, and stipulates the preparation of a
21 An European Commission document, 15/10/2007 22 The study was prepared in the period from March 2001 to January 2002 by the French consulting company "Louis Berger". 23 Transport Infrastructure Needs Assessment
18 five year annual plan (MAP), with SEETO being responsible for developing multi-annual indicative development plans which define the measures needed to ensure better regional cooperation and which designate the priority projects.
The Multi-Annual Plan (MAP) 2007-2011 for the development of the South-East Europe Core Network was adopted at the December 2006 Ministerial Meeting in Brussels. It clearly demonstrates the level of cooperation involved, providing an up-date and inventory of the condition and operational performance of the Core Network. The MAP has served as an important background and reference document for the TOP programming exercise.
1.1.5. Institutional Framework
At the overall level, responsibility for transport policy lies with the following ministry:
The Ministry of Sea, Tourism, Transport and Development (MSTTD) is the central government body responsible for transport. It is, among other activities that fall within its competence, responsible for administrative and other affairs relating to general transport policy - road traffic management, railway management, air traffic management, maritime traffic management, inland waterways management, protection of Adriatic Sea and organisation of preparation of strategic infrastructure projects and investment programs. It performs the tasks of co-ordination and expert development, and participates in the development of strategic documents. The MSTTD also conducts activities related to the process of EU integration in the transport sector, transport inspection, promotion of transport education and research in connection with transport policy. An organisational unit of the Ministry – the Directorate for Strategic Infrastructure projects has been appointed as the lead institution within the Operating Structure for the IPA Component III Regional development – transport, under the Regulation adopted by the Government of the Republic of Croatia in February 2007 (OG No. 18/07).
Other bodies concerned with transport in the Republic of Croatia are: Croatian Roads, Croatian Highways, Croatian Railways Group, Agency for Inland Waterways, Port Authorities, the Ministry of Culture, and Ministry for Environmental Protection, Physical Planning and Construction.
Responsibility for the railway sub-sector lies with a number of bodies:
Within the MSTTD, there are two units responsible for railway affairs:
• The Directorate for Railway Traffic, comprising three Departments for railway and combined traffic, infrastructure and rail facilities, and railway safety;
• The Department for Inspection of Safety in Railway Transport, under the Directorate for Transport Inspection.
These units are responsible for the preparation of legal instruments, development of strategies, reports, analysis and drafting measures concerning all other safety and policy issues.
Staff training needs in related matters will be met through the 2006 CARDS project: “Restructuring and Development of the Croatian Railway System within the Framework of the EU Legislation”
Croatian Railways Infrastructure – “HŽ Infrastruktura Ltd”. is a 100% state owned company established to act as infrastructure manager. It is in charge of construction, maintenance and operation of the Croatian railway (infrastructure) network. Responsibility for inland waterway sector lies with the following bodies:
Within the MSTTD, the Directorate for Inland Navigation is responsible for establishing the legislative framework through the creation and application of laws and subordinate legislation, as well as through multi-year plans and programmes for the development of the entire sector.
The transport policy of the inland navigation sub-sector, is proposed, created and implemented through the MSTTD Directorate for Inland Navigation. The offices of harbour masters also form constituent parts of the Directorate. Their
19 primary task is control and supervision related to regulations in the field of navigational safety, but the harbour-master offices also perform specific administrative tasks, such as keeping the register of ships, and establishing the sea- worthiness of boats for personal use, pursuant to the ordinance on boats (establishing the sea-worthiness of boats for personal use may, in exceptional cases, be conferred to the Croatian Register of Shipping).
Inspections within the jurisdiction of harbour-master offices are performed, pursuant to provisions of the Inland Navigation Act and the Inland Ports Act, by inspectors from the Department for Inspection Affairs of the Directorate for Navigational Safety and Protection of the Sea.
The Inland Waterways Agency is a public institution within the competence of the MSTTD, which was established only recently, at the end of 2005, and is responsible for planning the development of, and maintaining, waterways and navigational safety aids.
The International Sava River Basin Commission was established by the Framework Agreement on the Sava River Basin signed by the Republic of Slovenia, the Republic of Croatia, Bosnia and Herzegovina and the former Federal Republic of Yugoslavia) in Kranjska Gora (Slovenia) on December 03 2002. The International Sava River Basin Commission was established for purpose of implementation of the Framework Agreement, and realisation of the mutually agreed goals: 1. establishment of an international navigation regime on the Sava River and its navigable tributaries; 2. establishment of a system of sustainable water management; 3. undertaking measures for the prevention or reduction of danger to the safety of shipping, and tackling the hazardous impacts of floods, ice, drought and accidents involving substances having negative impact on waters.
1.1.6. National legal framework of transport
Again, in line with the strategic focus taken in the TOP, the following assessment of the transport legal status concentrates on the railway and inland water way sub-sectors.
1.1.6.1. Legal Status in the Railway Sub-sector
The legal system currently regulating the field of railway transport comprises of:
• The Railway Act (OG 123/03, 194/03, 30/04)
• The Railway Safety Act (OG 40/07)
• Croatian Railways Division Law (OG 153/05)
• Act on the ratification of Protocol of 3 June 1999 for the modification of the Convention concerning International Carriage by Rail (COTIF) of 9 May 1980 (1999 Protocol) and the Convention concerning International Carriage by Rail (COTIF) of 9 May 1980, as amended by the Protocol of 3 June 1999 (Official Gazette - International Agreements (OG-IA)12/2000)
• Law on Agency for Railway Service Market Regulation (OG 79/07)
With the aim of alliances in the railway sector, Croatia has entered into the following bilateral and multilateral agreements:
• Agreement on regulating border railway transport between the Government of the Republic of Croatia and the Government of the Republic of Hungary (OG 5/95). • Agreement between the Government of the Republic of Croatia and the Government of the Republic of Hungary on international combined transport of goods (OG 20/97)
20 • Agreement between the Government of the Republic of Croatia and the Government of the Republic of Slovenia on railway transport across the state border (OG 77/97 and 20/97) • Agreement between the Government of the Republic of Croatia and the Government of the Republic of Slovenia on international combined transport (OG 4/98), • Agreement between the Government of the Republic of Croatia and the Federal Government of the Federal Republic of Yugoslavia on regulating border railway transport (OG 1/98) • Agreement between the Government of the Republic of Croatia and the Republic of Bosnia and Herzegovina on regulating border railway transport (OG 8/00), • Agreement between the Government of the Republic of Croatia and the Republic of Bosnia and Herzegovina on the manner of use and maintenance of the railway line Bihać-Knin and the monitoring of the state border bodies (OG 4/01), • Agreement between the Government of the Republic of Croatia and the Government of the Slovak Republic on international combined transport (OG 17/98), • Agreement between the Government of the Republic of Croatia and the Government of the Republic of Bulgaria on international combined transport (OG 3/01), • Agreement between the Government of the Republic of Croatia and the Government of the Republic of Austria on international transport of goods (OG 17/98), • Agreement between the Government of the Republic of Croatia and the Council of Ministers of Serbia and Montenegro on international combined transport of goods (signed in Zagreb, November 2005)
As regards international organisations in the field of railway transport, the Republic of Croatia has acceded to COTIF24 and is a member of OTIF25.
With regards to UN membership, representatives of the Republic of Croatia regularly participate in UN-ECE meetings related to the railway transport. Croatia is also a signatory to AGC and AGTC26 agreements and a member of TER 27.
Also, in May 2006, Croatia signed the "Agreement on the Establishment of a High Performance Railway Network in South East Europe", which aims to improve the railway network in South East Europe, and thus increase the use of railway transport services.
1.1.6.2. Legal Status in the Inland Waterway Sub-sector
The legal system regulating the inland waterway transport comprises the following acts:
• Inland Navigation Act (Official Gazette No 19/98) and the Inland Ports Act (Official Gazette No 142/98)
• Act Amending the Navigation Act (Official Gazette No 151/03) and the Act Amending the Ports Act (Official Gazette No 65/02)
The Republic of Croatia has signed, acceded to, or ratified a number of international documents in the field of inland navigation, as follows:
• The European Agreement on Main Inland Waterways of International Importance (AGN) - by virtue of this agreement, the waterways of the rivers Sava, Drava and Danube and the planned canal Danube-Sava have been incorporated into the network of European waterways, while the ports of Vukovar, Osijek, Slavonski Brod and Sisak have been incorporated into the network of ports open to international traffic. Croatia also accepted to build and develop waterways open to international trade, in compliance with the prescribed standards of navigability categories referred to in the AGN. Croatia ratified this Agreement and it entered into force.
24 Convention concerning International Carriage by Rail 25 Intergovernmental Organisation for International Carriage by Rail 26 European Agreement on Main International Railway Lines; European Agreement on Important International Combined Transport Lines and Related Installations 27 Trans-European Railway Project
21
• The European Agreement concerning the International Carriage of Dangerous Goods by Inland Waterways (ADN). Croatia signed the Agreement on 14 June 2000, • The Budapest Convention on the Contract for Carriage of Goods by Inland Waterways (CMNI) – this limits the liability of ship-owners for damages incurred. The Convention has been signed and ratified by the Republic of Croatia.
• The Convention regarding the Regime of Navigation on the Danube, 1948, which the Republic of Croatia accepted by additional protocol in 1998, according to which Croatia is considered a signatory of the Convention as a successor of the former Socialist Federative Republic of Yugoslavia.
• The Framework Agreement on the Sava River Basin, introducing the international regime of navigation on the Sava River, balances the method of water management and coordinates the issues of protection of water and environment in the basin. The Agreement has been ratified and is being enforced.
• The Regional Agreement concerning the radiotelephone service on inland waterways (RAINWAT), Basel, 2000. The Agreement has been ratified and is being enforced.
1.1.7. Statistics
Transport data used in the TOP relies on several data sources: MSTTD, Croatian Roads, Croatian Highways, Croatian Railways Infrastructure, Agency for Inland Waterways, Port Authorities, Croatian Central Bureau of Statistics (Statistical Yearbooks) and EUROSTAT.
The transport sector and transport policy correspond to the situation at national, rather than regional, level, and data provided in TOP refers to national level (NUTS I) statistics.
1.2 COMMUNITY STRATEGIC FRAMEWORK
The Transport Operational Programme clearly sets out and elaborates the priorities in the sector for the rolling period, taking into account the Strategic Coherence Framework and the sectoral, thematic and geographical mechanisms of concentration of assistance, as set in the IPA Regulation, article 15528.
1.2.1 Consistency with relevant strategic documents
The strategy of the Transport OP is considered in line with the major policy objectives and priorities of both the Commission’s Multi-annual Indicative Planning Document (MIPD)29 for Croatia and the Strategic Coherence Framework (SCF) 2007-201330.
The Accession Partnership with Croatia31 is the main instrument providing Croatia with guidance in its preparations for accession to the EU. The objective of the partnership is to register in a single legal framework: • the priorities for reform with a view to preparing for accession, • financial assistance for the implementation of those priority areas and • the principles for the implementation of the Partnership
28 IPA Implementing Regulation, Article 155 (2) (c), IPA IR Commission Regulation (EC) N. 718/2007 implementing Council Regulation No 1085/2006 29 MIPD, C(2007) 2566 of 20/06/2007 30 Strategic Coherence Framework (SCF), adopted by the Croatian Government on 25/5/2007, adopted by the EC on 18/6/2007, http://www.strategija.hr/fgs.axd?id=451 31 The Accession Partnership for Croatia, Council Decision 2006/145/EC
22 One of distinctive features of the Partnership lies in the fact that this is a flexible instrument, designed to adapt to the progress already made by Croatia on its way towards full EU membership on the one hand, and on the other hand, to concentrate on what still needs to be done.
The priorities listed in this Accession Partnership have been selected on the basis that it is realistic to expect that Croatia can complete them or take them substantially forward over the next few years. A distinction is made between short-term priorities, which are expected to be accomplished within one to two years, and medium-term priorities, which are expected to be accomplished within three to four years.
Being just one of four Operational Programmes within components III and IV in the context of the IPA programme, the Transport Operational Programme tackles only a limited number of the broad priorities identified in the Partnership document. A clear link to the Partnership provisions can be established as follows:32 The Accession Partnership lists as medium-term priorities, under Transport policy the following provisions: • Continue work towards complete alignment with the EU acquis in the area of road transport. • Work towards alignment with the EU acquis in the area of inland waterway transport, in particular as regards the safety of navigation and River Information Services. • Continue implementation of the Memorandum of Understanding on the Development of the South East Europe Core Regional Transport Network
The Transport Operational Programme is linked to future European cohesion policy in Croatia. The structure and mechanisms of the IPA programme are often compared to the structure and mechanisms of the Structural and Cohesion Funds, and in that sense IPA represents a sort of precursor of the future implementation of cohesion policy in Croatia. In this light, the TOP complies with the policy framework for European cohesion policy, particularly with those goals set out in the Community strategic guidelines on cohesion.33
The Multi-annual Indicative Planning Document (MIPD) is the strategic document for IPA. It is established for a three-year rolling period, with annual reviews and it follows the Multi-annual Indicative Financial Framework (MIFF) which indicatively allocates funds per beneficiary and per component.
In order to define strategies that effectively contribute to the achievement of the overall objective, the MIPD is based on the assessment of needs and challenges as well as priorities identified in the Progress Report and Accession Partnership.
The MIPD sets out an overall framework which is strictly followed by the Transport OP; it stipulates that “EU assistance will focus on investments and collective services which are required to increase long-term competitiveness, job creation and sustainable development, namely (…) sustainable transport (railways and inland waterways).”34
In the context of regional development it defines high priority goals, one of them being to “strengthen the country's infrastructural base”35. Those “economic activities are to be stimulated by the provision of adequate and sustainable transport infrastructure with particular attention to the restructuring and upgrading of the railway system.”
The expected results of the priorities supported in the transport sector, as expressed in the MIPD, are: • inter-modal competition will be restored; • links with the European Union will be improved; • level of safety considerably increased; • traffic bottlenecks will be reduced; • efficiency and sustainability will be improved; • travel times for freight and passenger traffic will be reduced.
32 The Accession Partnership for Croatia, Council Decision 2006/145/EC 33 CSG,Council Decision of 6 October 2006 on Community strategic guidelines on cohesion (2006/702/EC) 34 MIPD, C(2007) 2566 of 20/06/2007 35 MIPD, C(2007) 2566 of 20/06/2007
23 The most relevant document in relation to the TOP is the Strategic Coherence Framework (SCF), which sits immediately above the OP in the hierarchy of policy documentation. Its Component III, Regional Development is intended to support activities directed towards:
• Transport infrastructure development, concerning, in particular, the interconnection and interoperability of national networks and with the trans-European networks; and
• Technical assistance for the preparation of preliminary studies and technical support related to eligible activities, including those necessary for their implementation. Also, technical assistance for preparatory, management, monitoring, evaluation, information and control activities and activities to reinforce the administrative capacity for implementing the IPA assistance under this component.
In this regard, the SCF proposes “to concentrate IPA assistance to the transport sector on helping to modernise the rail network and, later to also help develop the inland waterway system. “
The relationship between Croatia and the EU was first governed by the "Stabilisation and Association Agreement (SAA) between the European Communities and the Republic of Croatia"36, which was signed in October 2001, and came into force in February 2005. The SAA provided the legal framework for political dialogue, regional cooperation, economic relations and the use of the Community financial assistance.
In addition, the SAA came into force during the first quarter of 2005 and provides a legal framework for political dialogue, regional cooperation, economic relations and the use of Community financial assistance. With regard to transport infrastructure, the "Protocol 6 on Land Transport” expressly mentions “measures to develop multimodal transport infrastructure network … in particular on the Pan-European Corridors V, VII, X and the Adriatic / Ionean Pan- European transport area connecting to the Corridor VIII” (see Article 4).
The TOP further reflects the programming strategy adopted for the development of the SEE Core Network. In particular, Corridor X railway improvements rank high on the indicative list of priority projects for the SEE Core Regional Transport Network included in SEETO’s MAP 2007-200937.
The Republic of Croatia has prepared the Pre-accession Economic Programme (PEP)38,for the period 2005-2007, which was followed by an updated PEP for 2006-2008, and PEP for 2007-2009, - with the objective to define economic policies and reforms necessary for European Union accession. The latter provides a clear definition of the country’s mid-term economic policy, priorities and structural reforms planned for the three-year period. Its Transport Chapter (part of the ‘structural reforms’ section of the document) includes legislative and “non-legislative” measures to be implemented, which will have an impact on the State Budget expenditures, with special relation to the recently initiated reforms within railway sector and the liberalisation of the railway sector.
The EU is committed to sustainable development, and its development policy, including the cohesion policy, is driven by the Lisbon Strategy (Economic Development Strategy) and the Lisbon Community Programme (Growth and Employment Agenda); these were revised following a mid-term review in 2004. In this context, the framework for the use of Structural and Cohesion Funds is provided in the Communication Cohesion Policy in Support of Growth and Jobs, Community Strategic Guidelines, 2007-201339. The provision of efficient, flexible and safe transport infrastructure can be regarded as a necessary precondition for economic development as it boosts productivity and, thus, the development prospects of the regions concerned, by facilitating the movement of people and goods. Transport networks boost opportunities for trade, while increasing efficiency. Furthermore, the development of Europe-wide transport infrastructures (notably the relevant parts of the thirty priority projects for Trans-European Transport Networks), with a particular focus on cross-border projects, is essential to achieving greater integration of national markets, especially within the context of an expanded Union.
36 SAA, approved by EU on 13/12/2004, Council and Commission decision 2005/40/EC, Euratom 37 SEETO, South-East Europe Core Regional Transport Network Development Plan MAP 2007-2011. November 2006 38 PEP, Adopted by the Croatian Government on 30/11/2006 39 CSG,Council Decision of 6 October 2006 on Community strategic guidelines on cohesion (2006/702/EC)
24 “Support for rail infrastructure should seek to ensure greater access. Track fees should facilitate access for independent operators. They should also enhance the creation of an EU-wide interoperable network. Compliance and applications of the interoperability and the fitting of ERTMS on board and on track should be part of all projects financed.”
In summary, the focus of the present TOP on the railway and inland water sub-sectors fully complies with the EU transport policies and strategies, promoting sustainable mobility by optimising the use of low-cost and environmentally friendly modes.
1.2.2 Progress towards assuming EU membership responsibilities in transport
In general terms, the Community policy calls for adjustments in four principal areas:
• the harmonisation of Croatian legislation with Community law; • the up-grade and modernisation of transport networks; • the facilitation of access to the national transport market; • the harmonisation of operational standards and procedures.
According to the 2006 Progress Report, Croatia “needs to make increased efforts to align with the acquis, notably by further adoption of implementing legislation. Reinforcement of administrative capacity (both in staff numbers and in level of training) also remains a matter of priority for most transport sectors.”
Railways: Croatia is making progress in adjusting the governance of the Croatian railway sub-sector, and aligning its legislation, within the framework of the acquis communautaire.
There has been some progress in the area of rail transport. The Railway Act entered into force in 2006. In December 2005, the Act on the Division of the Croatian Railway Company was adopted, and a small holding with four different operational subsidiary companies, i.e. traction, passenger, freight and infrastructure is under establishment.40
The Railways Act includes the provisions of the First Railway The new Railway Act and Act on Package of EU directives 2001/12/EC amending 91/440/EEC, the Division of Croatian Railways 2001/13 EC amending 95/18 EC and 2001/14EC replacing have created the necessary pre- 95/19/EC). These directives, in chronological order, clarify the conditions for the liberalisation of the railway market. formal relationship between a state and the infrastructure manager on the one hand, and between the infrastructure manager and train operators (railway companies) on the other; the conditions that railway operators must meet in order to be granted a licence to operate services on the network; and the broad principles for capacity allocation and infrastructure charging.
However, the Croatian Railways Act does not fully meet the requirements of EU legislation, as demonstrated in the most recent (2006) legal gap analysis prepared for the railway sub-sector using Commission technical assistance41. Further alignment with EU legislation will require the adoption of a Second Railway Package (that is, directives 2004/49/EC, 2004/50/EC and 2004/51/EC), introducing structural measures to address safety and interoperability, and extending the liberalisation of rail freight to include also the domestic market. However, the transposition of safety legislation and the establishment of the different rail authorities remain outstanding issues. The railway directorate in the Ministry of the Sea, Tourism, Transport and Development was reorganised to establish a separate entity dealing with safety.42
Referring to the results of the above-mentioned February 2006 legal gap analysis, the most important provisions not regulated, or not addressed in the required detail, are the following:
40 EC Croatia 2006 Progress Report, COM (2006) 649 final 41 Atkins,BCEOM, Gopa,TYPSA, COWI: Draft Pre-Accession Strategy, February 2006 42 EC Croatia 2006 Progress Report, COM (2006) 649 final
25 • Management independence of railway undertakings • Principles for separation of infrastructure from transport undertakings • Improvement of financial situation (burden of debt) • Use of rail infrastructure • Railway safety and accident investigation • Licensing guidelines for 3rd party operators
In addition to legislative and regulatory reform issues to be addressed to complete the transposition process, it will also be very important to achieve progress in institution building. At present, Croatia lacks important “bodies” which are considered a pre-requisite for railway market liberalisation and “Europeanisation”, such as a licensing authority, regulatory body, safety authority, infrastructure manager, capacity allocation body and charging body. However, with adoption of Law on Agency for Railway Service Market Regulation in 2007 the regulatory body has been established and with adoption of new Railway Safety Act a legal pre-requisite for establishment of safety authority, notification body and investigation body has been made in line with EU Directives 2004/49/EC, 96/48/EC, 2001/16/EC and 2004/50/EC.
As pointed out in the SEETO MAP 2007-2011, the relatively small scale of SEE railways advocates a regional approach to infrastructure management. In fact, the proposal adopted by the Steering Committee is for the development of a regional common network statement as a common set of access conditions; this would, most likely, be a process requiring technical legal assistance.
In recognition of the urgency to fully conform to the requirements of the railway acquis, a three year project is planned with the title “Restructuring and Development of the Croatian Railway System within the Framework of the EU Legislation” for implementation under the Phare 2006 programme.
This project is intended to close the above-mentioned institutional gap and establish the respective bodies by 2008, including training measures for staff, in order to be able to meet the mandates attributed to the various institutions. The future implementation of these measures should be determined in a way that provides access to the network for 3rd party operators in the minimum time, whilst always guaranteeing that train safety is not compromised.
Inland Waterways: Most of the country’s legislation is considered largely in line with the acquis, and in the words of the Commission’s 2006 Progress Report “is being implemented effectively”.
The area of non-compliance concerns mutual recognition of diplomas, certificates and other evidence of formal qualifications, as there is no facility at the moment for recognising documents issued outside of Croatia. Access restrictions also still prevail concerning cabotage. However, the Government of Republic of Croatia has adopted new Inland Navigation and Port Act in August 2007. Aforementioned act is a legal pre-requisite for alignment with EU standards in area of inland waterway transport especially in area of access to market and profession, structural reforms and conditions of issuing and recognition of boat master certificate.
The adjustment and modernisation process is also well advanced in competing transport modes:
Roads: In this sector, the Commission considers the existing Croatian legislation to be close to the acquis, while stating at the same time, however, that “alignment with the acquis must continue”.43. Still, Progress can be reported in the field of road transport. Progress was made in alignment to the acquis through the adoption of ordinances on the transport of hazardous substances by road, on safety advisors, and speed limitation devices. 44The majority of the Croatian motorway system has recently been constructed in line with EU standards, and construction works are continuing. Croatian motorways are Pro-actively, the Republic of Croatia implemented on its own account now among the most modern and safe in an ambitious motorway construction programme in line with European Europe. standards, which is almost complete and which covers all the road
43 EC Croatia 2005 Progress Report, COM (2005) 561 final 44 EC Croatia 2006 Progress Report, COM (2006) 649 final
26 sections belonging to the South-East multi-modal transport corridor. Since the start of work in April 2001, 550 km of motorway and semi-motorway have been built.
As of now, 1065 km of motorway and semi-motorway is in operation
Both the air and maritime sectors still require further alignment, particularly concerning the “horizontal agreement” in aviation on the one hand, and Croatian flag improvements regarding its ocean fleet on the other.
Croatia is an Associate Member of the Paris Memorandum of Understanding on Port State Control. Nonetheless, the Croatian flag is currently on the grey list of the Paris Memorandum of Understanding. Administrative capacity needs strengthening in order to improve the effectiveness of maritime checks.
1.2.3 Concentration of assistance
The Transport OP proposes to concentrate assistance on infrastructure rehabilitation and upgrading in the railways and inland waterways sub-sectors
While the network of primary roads, sea ports and motorways in Croatia is comparatively well developed, there is a definite backlog of infrastructure maintenance and modernisation in railways and inland waterways sub-sectors by comparison.
In order to guarantee balanced network development, including all modes of transport, the indicative projects proposed in section 3.5 are aimed at up-grading both the railway and inland waterway networks to acceptable standards and network coverage. This, of course, implies that the entire logistics system needs to be better integrated and inter-connected.
The following table shows historic transport investment by the public sector over the last six years, expected spending in 2007, and, where data is available, investment plans for the period 2008-11 (in € million):
Invested Expected Planned
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 roads 405,58 786,59 1.216,36 1.132,90 1.197,03 1.089,92 943,18 903,67 [1] [1] [1] railways 23,22 36,87 107,86 131,27 94,84 161,78 262,92 335,61 459,60 472,32 [2]
Inland waterways 5,10 14,48 16,17 12,02 9,74 21,34 55,34 73,10 142,08 147,50 263,67 sea ports 11,75 11,01 11,85 14,98 18,76 34,55 68,41 89,57 113,30 115,57 80,94 airports 7,69 10,98 18,48 16,67 17,58 23,69 51,33 32,77 48,40 37,30 [3]
[1] „National Programme for Construction and Maintenance of public roads for period “2005 – 2008“ is the only relevant document for the moment, thus figures for years after 2009 cannot be given at this moment.
[2] A new national investment programme for the railway sector is actually being prepared by the line ministry; therefore the figures for 2011 cannot be given at the moment.
[3] Figures for investments in airport infrastructure after 2010 have not yet been confirmed.
27 As the table demonstrates, the road sub-sector has received the major share of public investment in transport over the last five years, with, on average, around 90% of total spending per year. This historic activity is based on the Parliament’s decision in 1999 to support a programme of motorway construction, which has been highly successful; 80% of the highway system initially targeted for construction is now operational and the complete motorway investment programme will be finalised by 200945.
By contrast, the railway and waterways sub-sectors received a modest 5-12% and 1% of total spending respectively over the past five years, these amounts being sufficient for basic maintenance and minor infrastructure modifications, but no major investments have been undertaken during this period.
The situation regarding rail investment has been aggravated by the financial situation in the railway sector, which has left little or no room for investment from revenues earned, and which explains the existing backlog of investment and maintenance in the railway sector. This is evident in the form of deteriorating infrastructure, existing single track lines, increasingly obsolete rolling stock, and outdated signalling and communication equipment.
As far as the available data, presented in the above table, on plans for future spending by transport mode shows, there is a planned shift in future spending under the national transport policy towards the railway and inland waterways sub-sectors.
In order to create interoperability conditions and, at the same time, prepare for open market competition, the Government has earmarked important supplementary funds for network and operations improvements. In the new “National Railway Infrastructure and Maintenance Programme for the period 2007 - 2011” announced by MSTTD on 13 September 2006, 10 billion kuna (approx. 1.35 billion EUR) is being set aside for reconstruction and maintenance works on the railways over this period.
1.2.4. Lessons learned from previous EU assistance
Based on the experience of project implementation and utilisation of EU funds, the following is an outline of the main issues relevant for the future implementation of the pre-accession assistance:
9 Croatian programme and project management capacity is evolving; the practical experience gained so far needs to develop and be embedded in future EU funds management structures. So far, weak institutional capacity on a national and sub-national level has proven to be the greatest obstacle in project implementation. Therefore improvement of technical assistance and capacity building at all administrative levels must be secured; 9 It is essential to have skilled and motivated staff and further efforts are needed to identify, train, develop and retain a body of such staff; 9 An inadequate and unprepared project pipeline is an obstacle to the utilisation of assistance. Therefore the preparation of sufficient, well designed and mature projects (in particular project design and tender documentation) is paramount to ensure use of EU assistance in a timely and technically acceptable manner. This issue is directly linked with the need for strengthening the capacity on all levels, but particularly of the final beneficiaries in order to prepare good project/tender documentation in a timely manner; 9 It is necessary to improve time management and quality assurance in all institutions, as well as to improve implementation capacity (tendering and contracting); 9 Importance of coordination between stakeholders. This requires extensive and clear information flows with a focus on a common understanding of tasks, timeframes and interdependencies;
45 100 km of national roads were modernised in the period from 2001 to 2004 alone; 120 km of new national roads were built in the same period. During 2005, 17 sections of state roads in the length of 55.4 km were reconstructed through periodical maintenance. Improvement work is currently under way on more than 400 km of the national road network. A little less than half of the funding required for this programme (€60 million) originates from loan granted by the European Investment Bank, while the other half of the amount (€62 million) is financed by Hrvatske ceste (Croatian Roads), the company responsible for the national road system, from its own funds.
28 9 Necessity for access to, and dissemination of, information in timely manner (to all interested parties) and greater emphasis on publicity measures (both EU assistance and sectoral co-ordination in general).
1.3 PARTNERSHIP CONSULTATION
This OP has been prepared by an Inter-Ministerial Working Group (IWG) comprising representatives of the relevant state institutions. The membership is shown in Annex 1. The intention of partnership consultations, led by the Ministry of Sea, Transport, Tourism and Development, was to inform interested parties of the importance of IPA as a new pre- accession instrument preparing Croatia for the future Structural Funds, and to receive constructive input on the OP in line with the possibilities and limitations set out in the EC strategic documents (MIPD) and the IPA Implementing Regulation. By informing the partners of the purpose, aims, possibilities and boundaries of the TOP, the consultations were structured so as to be constructive and to avoid raising unrealistic expectations about the scale and scope of the TOP. Judging by the experience so far, the consultations were successfully used as an opportunity to raise awareness of IPA and of the TOP, to build a consensus around its aims and content, and take the first steps towards assembling the Monitoring Committees and generating a constituency of future beneficiaries of both IPA and the Cohesion and Structural Funds. The consultations in that sense represented a ‘public launch’ for the OP.
In drafting the OP, the Croatian partners were a number of policy-making and policy implementation institutions and interest groups which the IWG consulted in order to assess the relevance of activities proposed under the OP. In putting together the list of partners, members of the IWG relied on the existing practice of their line ministry. Therefore national level representatives of the relevant stakeholders were involved – a mix, notably, of general economic and social partners, sector specific institutions, an environmental NGO and journalists. The representatives of the partner institutions in the OP consultation process were chosen by the partners, upon invitation by the line ministry to join the programming effort. Two rounds of consultations were held, the first round for the representatives of the transport sector, and the second round for the environmental institutions and journalists. It is important to emphasize that a number of environment protection NGO’s was invited to the partnership consultations although only one representative attended.
The list of partners who participated in the two consultation rounds includes: o Central Office for Development Strategy and Coordination of EU Funds o Croatian Railways Infrastructure, Limited o Institute of Transport and Communications o University of Zagreb, Faculty of Civil Engineering) o University of Zagreb, Faculty of Transport and Traffic Sciences o Railwaymen Trade Union of Croatia o Railroad Engineer Trade Union of Croatia o Infrastructure Union of Croatian Railways o Rolling Stock Technical Inspectorate Trade Union o Croatian Railwaymen Trade Union o Union of Croatian Train Dispatchers o Inland Waterways Agency o Green Action (environmental NGO) o Newspaper and radio journalists
It is important to underline that some of the bodies listed above represent regular consultation partners of the Ministry of Sea, Tourism, Transport and Development. The partnership practice undertaken for the purposes of IPA builds, in other words, on an existing national practice in policy-making and policy implementation. This national partnership practice has been elaborated to some degree under the policy section of the OP. A number of journalists were invited to the consultations in order to multiply the effects of the consultation process by presenting to the public the idea behind the TOP and its major aims.
29 TOP partnership consultations took place on 6 March 2007 and on 13 June 200746, in the Ministry of Sea, Tourism, Transport and Development. At the first meeting, of the partners invited, a very high number attended and showed their appreciation of the fact that the consultation process had been scheduled relatively early in the programming process. At the second meeting, for environmental sector and public media, the environment protection NGOs did not engage fully with the consultation process; with only one NGO attended the meeting despite invitations being submitted to a number of environment NGOs. Both meetings were organised and chaired by the Ministry of Sea, Tourism and Transport as the head of the operating body responsible for the OP. Following an introduction to the new pre-accession instrument IPA, and to its programming and institutional framework, key information on the Transport OP was presented to the partners and journalists and the individual priorities and measures were set out. In the questions and answer session that followed the attendees received additional detail and clarification regarding particular issues of interest. Most of the participants were interested in learning how to participate in the implementation of the presented projects, i.e. in the project design and/or works contract. As a follow-up to the meeting and a basis for their eventual comments, partners were supplied with a TOP summary (including priorities and measures), and power point presentations. In addition to both meetings, a reasonable timeframe was provided to those invited to submit their comments on any provision of the Transport OP.
Comments were received from the non-governmental organisation Green Action, which expressed satisfaction with the fact that investments will be targeted towards the railway and waterway sector, although noticing at the same time with some disappointment that road construction still remains among the priority objectives of the Croatian Government. They expressed concern with the fact that the Operational Programme targets operations on the Sava corridor and pointed to the fact that this may have detrimental effect on the Sava riverbed and the surrounding protected areas; Green Action insisted on the use of best available practices and technologies, and the full application of all relevant Croatian and international acts in the course of construction works. Equally so, they supported the extension of the capacity of the Port of Vukovar pointing to the fact that the works should be carried out in accordance with the existing national regulations and international documents in order to minimise potential harmful effects on environment and nature. Regarding the railway reconstruction operations on the section Zagreb-Okučani, the NGO expressed its support for the rehabilitation programme, in principle, and requested that all the environmental protection measures be implemented as appropriate.
The views of the Green Action will be addressed at the level of each individual project by the application of the environmental impact assessment procedure in the phase of project preparation and by full respect of the legal requirements that relate to the environment and nature protection prior to and during the construction works. The NGO sector will continue to be informed of the measures undertaken during project implementation to be kept aware of the efforts undertaken to avoid unnecessary detrimental impact on environment and nature during the implementation of the OP.
46 Public consultations process will have to be re-conducted if Transport Operational Programme will become subject of official revision(s)
30 1.4. EX ANTE EVALUATION
The ex ante evaluation of the second draft version of the TOP47 was conducted to optimise the allocation of resources and to improve the quality of programming, by using external experts to review drafts of the OP and assess:
• its relevance - the relationship of the strategy to the needs identified, • its effectiveness - whether the objectives of the programme are likely to be achieved • its utility - judging the likely impacts against wider social, environmental and economic needs, • its internal and external coherence,- including structure of the strategy and its financial allocations, and the linkage of the strategy to other regional, national and Community policies, and • the quality of implementation systems including monitoring indicators.
The evaluation was undertaken by a research team from the European Policies Research Centre (EPRC) at the University of Strathclyde in Glasgow. Within EPRC, the ex ante evaluation of the evaluation was managed and undertaken by Dr Sara Davis (Senior Research Fellow).
The evaluators employed the following sources as their methodological guidance:
• “The New Programming period 2007-2013: Indicative guidelines on evaluation methods : Ex ante evaluation, Working Document No.1”48 • “The New Programming period 2000-2006: Methodological working papers, Working Paper 2: The Ex-Ante Evaluation of the Structural Funds interventions”49 • “The New Programming period 2007-2013: Indicative guidelines on evaluation methods: Monitoring and evaluation indicators, Working Document No. 2”50 • “The New Programming period 2000-2006: Methodological working papers, Working Paper 3: Indicators for Monitoring and Evaluation: An indicative methodology”51
The aim of the ex-ante evaluation was to provide an external perspective on the preparation of the new programmes with a view to improving and strengthening the final quality of the programme and optimising the allocation of resources. The tasks for the ex-ante evaluation were fivefold: an inception discussion; the preliminary appraisal of programme elements; assessment of partner views; development of the evaluation.
Within this framework, the ex-ante evaluation also assessed the following issues: 'lessons learned' from previous and on-going relevant EU assistance; the quality of the process of elaborating the programmes; the coherence of the programmes with the acquis in key fields; the arrangements to integrate the environmental requirements; the likely significant effects on the environment; and respect of Community policies or principles.
An appraisal of the characteristics and effectiveness of the environmental integration of the TOP was also conducted (see Chapter 9 of the Ex-Ante Evaluation report), in accordance with the principles of Strategic Environmental Assessment, in particular the information requirements as conveyed in Annex I of EU Directive 2001/42/EC on the assessment of the effects of certain plans and programmes on the environment. The appraisal was conducted in accordance with the principles of Integration and was measured in terms of the perception of the environment, coherence with environmental policy and legislation, inclusion and application of environmental data, as well as programme environmental impact.
The result of the assessments presented in the Ex-ante evaluation report is the following:
47 The process of Ex-Ante Evaluation will have to be re-conducted if the Transport Operational Programme is the subject of official revision(s). 48 http://ec.europa.eu/regional_policy/sources/docoffic/2007/working/wd1_exante_en.pdf 49 http://ec.europa.eu/regional_policy/sources/docoffic/working/doc/exante_en.pdf 50 http://ec.europa.eu/regional_policy/sources/docoffic/2007/working/wd2_indic_en.pdf 51 http://ec.europa.eu/regional_policy/sources/docoffic/working/doc/indic_en.pdf
31 The Transport OP demonstrates an appropriate awareness of environmental factors, legislation and strategies, and the impacts of the transport sector and sub-sectors are clearly and purposefully identified. The programme interventions are justified on the basis of statistical evidence and represent continuity of previous policy developments. Environmental integration is adequate in the Transport OP, but there remains scope for increasing the profile of environmental factors, potentially through improved interaction with the Environment Operational Programme. Further material needs to be provided on projects in Priority 2, and themes such as the development of new harbour facilities would require EIA. The provision of environmental indicators will be an essential step to measure and direct programme environmental impacts.52
The executive summary of the Transport OP Ex-ante evaluation is as follows:
The Transport OP covers all the required issues, is structured in accordance with the template provided by the European Commission, and is written in clear, comprehensible English. The analysis provides a good justification for the strategy proposed, although some additional information is needed. The strategy itself, and the allocation of resources, is generally sound and is coherent with EU, macro-regional and domestic policy objectives in the transport sector, although some clarification is needed in relation to the proposed projects and the selection process. Information is provided on the implementation and monitoring arrangements (although both require additional detail), as well as financial tables and an indicative list of major projects. The OP demonstrates an adequate awareness of environmental factors, legislation and strategies, and the impacts of the transport sector and sub-sectors are clearly identified.
However, there are a number of key areas that should be taken into account when finalising the document. Some aspects of the analysis could be developed further. For instance, there is a need to consider how key restructuring processes relate to public investment strategies in the transport sector. There is a need to check the SWOT analysis to see that all points are justified and adequately explained in the preceding analytical sections. There are some questions relating to the projects outlined in the OP, the project selection process, and project readiness. The OP should also provide an overview table for the entire 2007-09 period and explain the differing co-financing rates. A clearer and more explicit description is needed of the links between the OP and existing transport policy strategies. For all indicators, data have yet to be provided on baselines and targets. The Programme’s description of the consultation arrangements with partners provides only a very brief and limited outline. The description of the implementation system covers most important aspects but a number of issues remain to be addressed. The OP could also increase the profile of environmental factors, e.g. by providing environmental indicators.53
The evaluators provided detailed recommendations for the improvement of the OP which were generally balanced and constructive and have been taken into account.
• The text has been reorganised and improved in some sections, as suggested, which has contributed to the final text being more coherent and readable; • The analytical sections have been strengthened in order to justify and adequately explain the SWOT analysis; • The selection criteria set has been re-examined and revised to increase coherence and clarity, and to place an emphasis on the maturity of the projects; • Indicators were not appraised in detail during the ex-ante evaluation as they had not been sufficiently developed at the time. Indicators have since been developed, re-examined and slightly modified in order to achieve a higher level of relevance and quality. Additionally, indicator values and data sources have been determined; • As suggested, a clearer and more explicit description of the links between the OP and existing transport policy has been given; • The public consultation process was mainly carried out in the period following the ex-ante evaluation, and more detail information has now been provided on the process.
The ex ante evaluation report is attached at Annex 6.
52 The Ex-ante evaluation of IPA Operational Programmes for Croatia, Transport Operational Programme, April 2007, p.21 53 The Ex-ante evaluation of IPA Operational Programmes for Croatia, Transport Operational Programme, April 2007
32 2. ASSESSMENT OF MEDIUM TERM NEEDS, OBJECTIVES AND STRATEGIC PRIORITIES
Because Croatia is located in the centre of the North-West / South-East transport and transit corridor, the modernisation of its transport sector is not only an internal development pre-condition, but also one of Croatia’s potential comparative advantages. The fact that five Pan-European Corridor segments belong to the territory of Croatia makes its geographical position not only a comparative advantage, but also places an obligation on Croatia in relation to the network development for Europe as a whole.
2.1. SOCIO- ECONOMIC ANALYSIS (INCLUDING SWOT)
2.1.1 General infrastructure and transport situation
Due to its geographic position, Croatia is highly significant for the establishment of effective transport links between Western Europe and the Balkans, and for the connection between Central Europe and the Adriatic Sea and the Mediterranean.
Most importantly, Croatia is intersected by major Pan-European transport corridors and their branches (see picture 2), such as:
• Corridor X: The Pan TEN Corridor passes from Austria through Greece to Turkey (Salzburg - Villach - Ljubljana - Zagreb - Belgrade - Skopje – Thessaloniki). It is on the SE Axis established by the High Level Group. The Croatian railway and roads sections of the main corridor axis have a total length of 317 km and 306 km respectively. • Corridor Branch Xa: Graz - Maribor – Zagreb. • Corridor Branch Vb: Rijeka - Zagreb – Budapest. • Corridor Branch Vc: Ploče - Sarajevo - Osijek - Budapest • Corridor VII: the Danube river with tributaries / Sava River
The Croatian sections of the Pan-European Corridor system as described above are integral parts of the SEE Core Regional Transport Network as included in the SEETO MAP for the period 2007-2011.
The location of Croatia within (i) the Pan-European corridor system in general, and (ii) the SEE Core Regional Transport Network in particular, is illustrated in pictures 2 and 3 below.
The following detailed assessment of Croatia’s infrastructure and transport situation is focused on the railway and inland water sub-sectors in line with the proposed TOP strategic priorities, and with special reference to SEE Core Network relevance.
The general conditions in other transport sub-sectors (roads, ports, inter-modal terminals) have been described to the extent necessary for a better understanding of the strategic priorities followed in the TOP.
33 Picture 2 - Pan European Corridor Network
34 Picture 3 - SEE Core Network
2.1.1.1. Railways
The Croatian railway network comprises, in total, 2,720 km of track, of which 254.3 km is double track and 2,465.7km is single track; 977.64 km is electrified.
Croatia has the second largest portion (26%) of the SEE Core Rail Network which, overall, is 4,264 km long. Railway Corridor X, again on the SEE Core Network, is 1,058 in length and accounts for about 50% of the overall length of the Corridor X. The Croatian part of the Railway Corridor X on the SEE Core Network passes from Savski Marof via Zagreb and Vinkovci to Tovarnik at the eastern border and is 317 km long.
In terms of the density of the rail network, Croatia exceeds the EU average with 62 km per 100,000 inhabitants, as against 45 km per 100,000 inhabitants in the enlarged EU 25. During the war, great damage was inflicted on the railway infrastructure, contributing to the fall in traffic on the railways since independence. A lack of public funding during the past decade has led to a backlog of investment and maintenance.
Network conditions leave ample room for improvements: Only 9% of Croatian railways have been fitted with double tracks, and only 36% of the total network has been electrified. Due to poor infrastructure conditions railway performance is significantly reduced, as manifested by rather low commercial speeds on selected sections and recurrent train cancellations and delays.
An illustrative indicator of the railways’ poor network condition is the permanent speed limitations. As can be clearly seen from the railway operation conditions map below, the problem of reduced operating speeds is rather severe:
35 • Operating speeds along the Corridor X Croatian railway section, currently ranging from 60 km/h to 120 km/h, are below the envisaged standard of 160 km/h, based on AGC and AGCT Agreements.
• Speed is lowest on the sections: Vinkovci – Tovarnik, Savski Marof - Zaprešić - Zagreb and Dugo Selo – Novska.
• Longer travel times due to speed limitations are aggravated by lengthy border waiting times.
Picture 4 – Operating speeds along the Corridor X
Therefore, the proposed priority improvement projects included in the TOP indicative project list (section 3.5) aim to rehabilitate track, fix structures, signalling and communications, in order to increase speed and reduce journey time, increase service quality and regenerate demand for this vital international transport route. It should be noted that all the problem sections mentioned are taken into consideration in network improvement programming: while rehabilitation of the section Vinkovci – Tovarnik has already started under ISPA 2005, all other sections are part of the indicative project list proposed in this TOP.
As an example, taking again actual speeds as an indicator for network quality and track condition, over a continuous 392 km of Corridor X, from Vinkovci in Croatia through Belgrade to Niš in Serbia, the actual speed does not exceed 50 % of the design speed, according to MAP 2007-11.
36 There has been only a modest improvement in Croatia and in the Core region since the REBIS study as shown in the MAP 2007-2011. 26% of the SEE Core Rail Network is still classified as poor, and a further 1% is classified as very poor, while only 8% is considered to be in good condition. According to the same source, speed restrictions may still be found on 70% of the network.
In Croatia, the section Vinkovci – Vrpolje has recently been overhauled and its geometrical properties enable trains to reach a maximum speed of up to 160 km/h. Works however are not yet completed and ETCS (European Train Control System) devices and there is still a need to install remote traffic controls along the entire section.
Before the war, major railway earnings came from Corridor X traffic. Rail traffic volumes dropped drastically during the 1990s on the Core Network sections, but are now gradually and steadily recovering as evidenced by recent traffic growth figures along Corridor X. As confirmed in the MAP 2007-2011, “significant traffic flow in terms of trains per day is reported for much of the (Core) network”.
In terms of rolling stock, the traditional passenger coaches are considered sufficient in terms of numbers and standards for present operations. The freight fleet consists mostly of conventional covered or open wagons, some suitable for combined traffic operations. A large number of locomotives are in need of replacement, with an estimated 70% reaching the end of their working lives within the next decade. There are plans to install ETCS on the rail network, but these depend on the locomotives which run on the corridor also being equipped with the system.
The first steps have been As regards freight services, 50 new wagons have been built for RoLa undertaken by HŽ to (Rollende Landstrasse - Rollling Road) operation for promoting the use of modernise the fleet. the Spačva RoLa terminal, for which a corresponding RoLa terminal is planned in Zagreb area.
The railway companies have started to modernise their fleet of passenger coaches. To render passenger services more attractive, the railway companies procured an initial series of modern tilting trains, to offer passengers a much more comfortable and quicker journey. According to international experience, trains that tilt can go up to 25% to 40% faster around curves than conventional trains without inconveniencing the passengers, and hence can significantly increase average speeds and cut journey times.
The modernisation of the rolling stock, in parallel to planned line improvements, will be vital for strengthening the competitiveness of rail transport in comparison with other transport modes.
2.1.1.2. Inland Waterways
The total length of inland waterways within Croatia’s borders is 804.1 km, of which: • The Danube is 137.5 km in length; • The Sava is 447.7 km in length; • The Drava is 198.06 km in length; • The Kupa is 5.9 km in length; • The Una is 11 km in length
The river ports situated along these inland waterways are: Osijek, Sisak, Slavonski Brod and Vukovar.
37 Picture 5 – Croatia’s Inland Waterways Network
The most significant inland waterways in Croatia are the Danube waterway and the Sava river inland waterway, but as transport resources, they are relatively under-utilised. The river ports suffered heavy damage during the war; their infrastructure is in a poor state and inadequate for the provision of quality services. Once the navigation conditions are brought back to pre-war levels and up-graded, there is potential for the inland waterways to be used in combination with railway transport as an alternative to the currently dominant road transport network, as well as in combined transport operations.
Navigation on the Sava River was well developed in 1990. The commercial waterway had a length of 586 km and reached from Sisak (Croatia) 50 km from the capital Zagreb to Belgrade (Serbia). From the mouth of the Sava at the Danube, the river was Class IV (equal to draught of 2.5m) up to Brčko, while from there to Sisak, it was Class III. Historically, the possibility of navigating all the way to Zagreb has been limited. In addition, navigability on the otherwise feasible river sections depends on seasonal conditions.
Today, in total only 287 km of the rivers Danube, Sava and Drava comply with the requirements for an international class of waterway. The total network density is significant in comparison with EU countries, but there is no internal connection between the Danube and Sava rivers, while traffic on the Sava (as well as port activity) is presently constrained by the low levels of navigational safety in the downstream part of the water basin, due to war debris and heavy sedimentation in particular places.
However, a number of rehabilitation activities have been started: The Sava River Commission carried out a pre- feasibility study of the rehabilitation needs of the river. The study was finalised by February 2007 and officially presented on March 2007. Also, Serbia announced plans at the most recent (December) SEETO Ministerial Meeting to make an IPA application for the removal of obstacles in the river bed of the Sava and Danube.
38 2.1.1.3. Roads
The road network totals 29,016 kilometres in length, and is classified administratively as follows: • motorways and semi-motorways : 1,065 km • national roads : roads 6,812 km • county roads : 10,604 km • local roads : 10,535 km
The total density of the road network (see picture 6) is 51.32 km/100km2, and for motorways alone is 1.88 km/100 km254.
The condition of the road network is in correlation with various traffic intensities. According to the actual data for the year 2005, the average annual daily traffic (AADT) was 3,353 vehicles /day.
Year AADT trend
2001 3320,67 2002 3381,23 1,8% 2003 3599,9 6,5% 2004 3483,96 - 3,2% 200555 3353,72 - 3,7%
According to available data describing the condition of road surface in respect of roughness and damage, the condition of road surfaces on the national roads network can be broken down into three categories - good, fair and poor condition. Collected data on the condition of road surfaces are kept in the road data base of Croatian Roads Ltd. (Hrvatske ceste d.o.o.)
Total condition of the pavement on the national roads network in 2006
34% 42%
good
fair
poor
24%
54 The Betterment II programme is currently in the planning phase, with the aim of the rehabilitating 52 sections or 680 km of state roads. Motorways and semi-motorways are relatively new. The first motorway was opened to traffic in December 1972. A toll is charged on all motorways located in the Republic of Croatia; Croatia has 32 years of experience in toll collection. 849.15 km of motorways are currently in use in Croatia. 55 Data not available for the year 2006
39 Today, Croatia has 24 km of motorway per 100,000 inhabitants, which exceeds density levels within the EU-15 (14 km of motorway per 100,000 inhabitants). The focus of improvement works is currently shifting from motorway construction to national roads, only 35% of which have a good quality asphalt surface.
While Croatia enjoys a high density of motorways, in part due to the investment set out in section 1, vehicle ownership is also growing strongly, and hence, the motorised vehicle stock in Croatia is increasing fast. As regards the country’s vehicle stock, 1,45 mln. passenger cars were registered in 2006, representing a 4.6 % increase in comparison with the previous year. The increase in the number of trucks is equally significant. 160,549 trucks were registered in 2006, which is a 4.4 % increase when compared to 2005. It should be noted that, since 1997, the import into Croatia of motor vehicles which are not homologised is not permitted, in accordance with UN-ECE rules and standards.
Altogether, the vehicle stock (passenger cars, busses and trucks) has increased by 16 % since 2002, as can be seen from the table below.
2002 2003 2004 2005 2006
Vehicle Stock 1,377,999 1,436,544 1,487,042 1,542,213 1,599,842 (cars, busses and trucks)
Source: Croatian Roads
This is reflected in growing traffic levels within the Core Network that inevitably peak during the summer holiday season, as shown below:
Average traffic56 Corridor Vb Section Corridor X Section Route 157 AADT 9,900 15,700 8,000 ASDT 16,900 17,100 20,500
56 AADT = average annual daily traffic; ASDT = average summer daily traffic 57 Route 1 is a part of Core Network and one of the most important routes in Croatia
40 Picture 6 – Croatia’s Road Network
2.1.1.4. Maritime Ports
The Croatian coastline is 1,400 km in length. The two dominant cargo ports are Rijeka and Ploče; the major passenger ports are Zadar, Split and Dubrovnik. Only Rijeka and Ploče have significant container traffic.
Cargo turnover in Croatia’s sea ports increased strongly over the past five years in the ports of Rijeka, Zadar, Šibenik, Split, Ploče, and Dubrovnik. The total volumes handled are shown below:
YEAR 2001 2002 2003 2004 2005 2006 CARGO in millions of 11.833 11.929 14.560 17.077 18.801 19.113 tonnes Sources: 2001-2003: Data from the port authorities; 2004-2006: Central Bureau of Statistics (CBS)
Multi-modal operations are still in their infancy. In the first half of 2005, a total of 51 000 TEU (Twenty Foot Equivalent Unit) containers were handled by Rijeka and Ploče ports, compared with 71,194 TEU for all of 2004, pointing to an increasing trend year on year.
41 Port infrastructure and equipment still lags behind other competing ports in the region, despite substantial investments made over the past five years58.
2.1.1.5. Air Transport
The Republic of Croatia has seven international airports (Zagreb, Dubrovnik, Split, Zadar, Pula, Rijeka i Osijek) and two smaller airports (Brač and Mali Lošinj), through which public air transport (line and occasional) takes place, both national and international. The seven biggest airports are of 4E ICAO category, fitted with devices and equipment corresponding to international safety and security standards. In order to fulfil its social role, each airport must address the improvement of its security level, quality of its services, and efficiency of its operations; at the same time, it has to ensure the necessary capacities in accordance with the transport demand.
Table 1 - Air transport in Croatia YEAR 2001 2002 2003 2004 2005 2006 Airplane transport (movements of 45,417 48,265 50,443 54,203 64,601 89,337 airplanes) Passenger transport, 2 348 2 535 2 922 3 297 3 916 4 425 (1,000s) Cargo transport, in 8 997 8 221 8 765 9 936 18 109 11 888 tonnes
In 2005, almost four and a half million passengers in total passed through all Croatian airports; 90% of this volume was accounted for by the three biggest airports (Zagreb, Split and Dubrovnik). The development strategy for air transport in the Republic of Croatia, elaborated in 2002 by the Institute of Transport and Communications, predicts that the air transport sub-sector will grow at the rate of 8.8 % annually until the year 2010.
2.1.1.6. Transport Terminals
Multi-modal terminals operated by the Croatian Railway Group are: Vrapče (Zagreb), Brajdica (Rijeka) and Spačva (near Vinkovci).
The characteristics of the three container terminals are as follows:
• Vrapče (Zagreb) is equipped for handling of containers, exchange of Multi-modal transport services in Croatia are, at truck cases (boxes), and for road semi-trailers up to 40 tonnes in present, rudimentary weight.
• Brajdica (Rijeka) is equipped for the handling and storage of containers, RO-RO (Roll on – Roll off) trailers and other vehicles, as well as for handling of heavy pallets and stones. It can accept 5,000 TEU at the one time and about 100,000 TEU annually.
• The new Spačva terminal is located in the zone of the Spačva train station near the Zagreb - Lipovac motorway (Pan-European Corridor X). The terminal is primarily destined for RO-LA operation. It is 20 km away from the Serbian border to the west (Corridor X) and 22 km from the border with Bosnia & Herzegovina to the north (Corridor branch Vc).
58 In the scope of the Rijeka gateway project, the passenger port will be modernised, a new nautical centre will be built, and preparatory works will be carried out for the development of the Delta and Porto Baroš zones.
42 By 2008, another RO-LA terminal will be built at the Zagreb marshalling yard area.
The overall growth of rail container traffic is strongly related to the Rijeka port turnover and development. There is no container traffic on Croatian inland waterways.
2.1.2. Traffic Characteristics and Modal Split
Road transport is the dominant transport sub-sector in Croatia, in terms of both market share and investments undertaken.
2.1.2.1. Freight Traffic
Over the last six years, the picture is as follows: In 2006, Croatian carriers transported a total of 119.7 million tonnes of merchandise (or 27.47 % more than in 2001) in railway, road (public and private transport), sea and coastal transport, transport on inland waterways, air transport and pipeline transport. The split by modes is shown below:
Transport mode Millions of tonnes (2006) Change over 2001 Road 63.0 54.4% increase Sea and coastal 31.42 -85.8% decrease Air 6.0 -81.3% decrease Rail 15.39 32.9% increase Inland waterways 1.69 50.5 % increase
Looking closer at railway freight operations, the following picture emerges: 260 trains were used on a daily basis for the railway transport of cargo. Their commercial speed was 26 km/h and typical (average) delays were 66 minutes per 100 kilometres. The average weight of freight trains was 749 tonnes, and the coefficient of empty wagon travel was 0.79.
Railway Freight Trends: The last two years’ figures confirm the overall railway trend. Since 2000, railway performance, in terms of tonnes carried, increased by over 40%. Measured in tonne-kilometres travelled, rail performance increased at an even higher rate, from 1.928 billion to 3.106 million, or an increase of 61 %. This overall positive development trend reflects the railways’ intensified commercialisation efforts.
The increase in average transport distance per consignment again points to decreasing unit cost per tonne of railway operation.
Most importantly, the reported increase in traffic performance of the railways has led to a steady increase of HŽ Infrastructure revenues and, as a consequence, reduced the need for Croatian Railways Infrastructure to be supported by the state budget.
2.1.2.2. Passenger Traffic
Over the last decade the picture has been as follows: In 2006, Croatian carriers transported a total of 123.94 million passengers on various inter-urban transport routes. The split by modes of transport is shown in the following table: Transport mode Millions of passengers (2006) Change over 2001 Road 63.6 -5.6% decrease Rail 46.259 25.6% increase Sea and coastal 12.1 34.3% increase Air 2.07 65.6% increase Source: Central Bureau of Statistics
59 Including sub-urban traffic
43 The following numbers of passengers used urban transport facilities in 2006:
Transport mode Millions of passengers (2006) Change over 2001 Buses 186.8 -15.6% decrease Tramways 179.5 1.3% increase Source: Central Bureau of Statistics
The 46.2 million passengers carried in 2006 by the railways correspond to 1.362 million passenger kilometres. This represents 97.3 % of 1990 levels, which was the last pre-war year.
Moreover, domestic passengers accounted for 95.8 % of all passengers in 2006, and 67.9 % of total passenger kilometres. Over 600 trains were used every day in domestic passenger transport, as follows: • urban and suburban trains in the Zagreb area - 72 trains; • local trains for distances of about 100 kilometres which are used in the transport of daily and weekly commuters between urban centres and surrounding areas - 515 trains; • intercity trains linking towns and counties - 48 trains; • vacation trains, sports trains and special event trains organised by Croatian Railways Passanger Transport and tourist agencies
International travellers accounted for the remaining 4.2 % of total passengers, but 32.1 % of passenger kilometres. In total, Most international railway travellers use 106 trains were used for international passenger traffic, the the Pan- European Corridor X railway corridor. most significant passenger services/lines being:
• Zagreb to the following destinations (and vice versa): Vienna, Budapest, Munich, Venice, Zurich, Ljubljana, Belgrade. • Rijeka - Budapest and Rijeka - Ljubljana.
Railway Passenger Trends: The last two years’ figures confirm the overall trend. Railway performance, in terms of passengers carried, grew by almost 14 % during the period 2000-2005. However, railway performance saw only small growth when measured in passenger kilometres travelled, increasing from 1.252 million to 1.265 million, or 1.04% during 2000-2005.
The statistics show that volume growth in railway passenger traffic originates from short-distance urban and sub- urban traffic, which can be seen as an important growth market for the railways.
As to service quality, the commercial speed of passenger trains was 48 km/h, and trains were typically 5 minutes late for every 100 km of travel.
Freight transport by inland waterways on the Danube River is steadily increasing, whilst on the Sava River it is stagnating at low levels, mostly due to very poor basic safety conditions for navigation in the lower part of the river. In 2006, public cargo transport amounted to 1,697.000 tonnes, excluding Danube transit transport.
Annual river transport figures are based on information provided by Port Authorities and are expressed in tonnes transported. The higher Croatian ports activity is due to the increase in international cargos. Between 2000 and 2005, cargo river transport grew from 646.000 tonnes to 1,629.000 tonnes in the following ports: Osijek, Sisak, Slavonski Brod and Vukovar. The highest increase was registered in the port of Vukovar, with a very high percentage of transit transport – 80 %.
As regards the situation on the Sava river, the volume of freight transport has collapsed since the pre-war period. Before 1990, some 7.5 million tonnes were shipped annually60. By 2005, without accounting for gravel and sand, the transport volume amounted to a mere 200 000 tonnes of river cargo
60 MSTTD; State Bureau of Statistics of the (Former) Republic of Yugoslavia
44
With regard to maritime traffic, the number of passengers has been growing steadily since 2001. In total, 9 mln. passengers were transported in 2001, while 10.5 mln passengers were transported in 2003. As many as 9.5 mln. passengers were transported in the period from January to October 2004, and 22.58 mln. tonnes of cargo was transported in the same period. In 2006, 12 passengers and 31,423 tonnes of cargo were transported.
Regarding aviation, a total of 4.4 mln. passengers were transported in 2006, compared with 3.94 mln. passengers in 2005. The airports of Zagreb, Split and Dubrovnik account for the vast majority of passenger transport. According to ‘Air Transport Development in the Republic of Croatia’, the strategy produced by the Institute of Transport and Communications in 2002, it is anticipated that air traffic will grow at the rate of 8.8 % annually until the year 2010.
The analysis of the state of Croatian airports shows that they greatly lag behind airports in other European countries, particularly with respect to passenger, airport and cargo handling techniques at arrival and departure. Airports currently operate using equipment compliant with existing safety standards, but to be competitive they should be equipped, modernised and brought to levels consistent with current world standards.
The status of airports in the Republic of Croatia is regulated by the Law on Airports (Official Gazette No. 19/98). On the date of entering into force of the law on airports, airports became limited liability companies, in which the state, the county on the territory of which the airport is situated, and local authorities, all participate as shareholders.
2.1.2.3. Modal Split between Modes of Transport
The resulting modal split for both passenger and freight traffic is depicted below for the year 2006, measured in passengers and tonnes carried:61
STRUCTURE OF PASSENGERS TRANSPORT BY MODE, 2006 in 000 number of passengers
Railway 46212 37%
Road 63576 51% Sea water Air coastal 2079 12079 2% 10%
61 MSTTD; Central Bureau of Statistics of the Republic of Croatia
45 STRUCTURE OF FREIGHT TRANSPORT BY MODE, 2006 in 000 number of tons caried Sea water coastal 7667 Road 27,38% 14313 51,12%
Pipeline Inland water 2489 Railway Air 105 8,89% 3423 1 0,38% 12,23% 0,00%
The charts demonstrate the dominance of road transport in carrying both passengers and freight, with rail transport enjoying a modal share of only 37% and 12% respectively, and inland waterway responsible for less than 1% of all goods transported.
It needs to be recalled in this context, that the Croatian railway network suffered great damage during the war. Its rolling stock - locomotives and wagons - was either heavily damaged or looted and plundered. Because of this, and also because of the fall in economic activity during and after the war, railway traffic has still not attained pre-war levels. No doubt another determining factor is that the excellent arterial road network of Croatia today, which runs in parallel to the railway corridors, leaves Croatian railways under permanent threat of the diversion of traffic from rail to road.
Similarly, transport on the Sava River has practically disappeared, mainly due to fairway obstructions caused by the war.
Furthermore, the following points should be noted:
• The market share of railways is particularly weak with regard to freight movement (12.2%), not least due to low commercial train speeds, while the market share of inland waterways is currently almost insignificant.
• The lion’s share of both freight and passenger traffic is carried by road. The strong competitive position of the road mode is reflected in the fact that the annual increase of freight carrying vehicles (3.9 % from 2004 to 2005) has been more or less in line with GDP growth.
• However, as seen from past improvements in both the railways and the river transport sector, there are positive signs of revitalisation.
2.1.2.4. Cross-border traffic
In 2006, 19.99 million passenger vehicles entered Croatia by road, which is a 5.1 % increase over 2005 (19.03 Million vehicles). Of this number, two-thirds of the vehicles were registered in other countries.
In the same year, a total of 69.58 million passengers entered Croatia (all modes), which is a 4% increase over 2005. Of this number, 22.09 million were of Croatian nationality (a 3.2 % increase over 2005) and 47.49 million were foreign nationals (a 4.4 % increase).
46 Most interestingly, 66.1 million or 95.4% of passengers entered the country by passenger car, a figure which clearly illustrates the traffic generation effect created by the new motorway network.
The shares of the different modes in total cross-border movements are as follows:
Transport mode Millions of passengers (2006) Change over 2005 Road 66.09 3.6% increase Sea and coastal 1.07 8.7% increase (9.4 % increase in foreigners alone) Rail 0.66 9% decrease Air 1.75 16.2% increase
2.1.2.5. Urban transport
Faced with the large growth of urban transport in the cities of the Republic of Croatia, city authorities, and especially the City of Zagreb, have taken and are taking a number of planning, technical and legal measures in order to reduce the unwanted effects of urban transport upon the life of city populations and, by doing so, increase their mobility. We specifically mention the City of Zagreb, the capital of Croatia, since it leads the way in the implementation of measures regarding clean and safe urban transport. The planning measures, in line with travel growth, envisage the construction of a fast city railway. It is expected that this project will be fully realised by 2015. The city administration has organised pedestrian zones and bicycle lanes wherever possible. Considerable funds are directed towards public transport. Seventy-five new trams have been bought and another seventy-five are on order. Since it is clear that public transport is the best solution for cities, city buses are being adapted for biofuel use. City buses fuelled by biofuel began to operate in May 2007.Currently, there are only ten biofuel buses in operation but it is expected that, after the testing period, all 150 buses will be fuelled by biofuel. The situation is similar in other cities, but due to their lower population their problems are fewer. However, all problems in relation to the influence of transport on the environment are being addressed through the coordinated work of all Croatian cities.
Data on the number of passengers in Croatian cities in 2006:
Buses 186 768 000 passengers Trams 179 515 000 passengers
The number of passengers (in millions) in urban and suburban transport in the City of Zagreb:
Year 2001 2002 2003 2004 2005 2006 No. of passengers 19 533 19 590 19 598 20 144 21 151 27 325
2.1.2.6. Outlook
General It seems plausible to assume According to preliminary traffic forecasts produced for the Balkan that in the case of Croatia the region’s core transport network, in the framework of earlier international freight and 62 passenger traffic increase will transport sector assessments , traffic is predicted to increase by be concentrated on Corridor X. 200-300% by road, and 60-140% by rail. These figures reflect the moderate growth scenario for the transport sector.
62 Reference is mainly to the EU funded REBIS Regional Balkans Infrastructure Study, Final Report July 2003. In intercity traffic, aviation became a competitor for the railways. Major airports are located in Zagreb, Dubrovnik, Split, Zadar, Pula, Rijeka and Osijek. There are further two airfields in Mali Lošinj and Brač for mainly special services, as well as 17 airfields for landing of general purpose airplanes, 5 small airfields, 3 heliports for exclusive use and 4 heliports for emergency use.
47 For Croatia, being a natural transit country and at the centre of Pan-European Transport Corridor X which connects Austria to Greece, it will be of utmost importance to gradually improve interoperability and achieve smooth cross- border operation, especially for the railways along Corridor X, in order to succeed in inter-regional and intra-regional corridor competition and to be able to capture significant parts of future traffic potential. Moreover, increasing its market share in international goods and passenger traffic on Corridor X is a pre-requisite for rendering line investments and railway operations financially feasible.
In developing network interoperability in the new trans-European context, train control systems are a crucial link between national networks and between infrastructure and railway operations. The TOP therefore, in full awareness of the fact that increased harmonisation of systems is an important goal to achieve, and in an effort to advance standardisation, is focused on railway investment projects which deal with signalling system improvements and ETCS63 installation.
Railway Traffic Forecast
As regards future development potential, the following assumptions seem reasonable:
• Long-distance international transport and inter-modal transport will be factors in future demand growth in Croatia.
• While available railway market studies could not identify any significant potential for local intercity passenger growth, recent experience shows that sub-urban transport is a potential growth market for the railways. Already today, some 90 % of all daily trains are engaged in urban and commuter traffic.
According to internal railways forecasts, the planning target for the forthcoming period is a 3.9 % increase for internal passenger transport and 4.9 % increase for international passenger transport.
An average annual increase of 4.3 % for rail transport of cargo (in tonnes) is planned over the same period (domestic transport: 8.1 % and international transport: 3.1 %).
These forecasts have been based on an increase in transport activity along the arterial transport routes toward the east, from Central Europe in the direction of the Southern Europe via Croatia along Corridor X, on a further increase in transport activity to and from Bosnia and Herzegovina, and finally on increased ports' activity, particularly in Rijeka.
Of course, a significant pre-condition for an increase in the transport market share held by railways is the modernisation and renovation of the rolling stock in line with current market requirements, as well as the provision of new products, one of them being the RO-LA.
Inland Waterway Traffic Forecast
There are no specific traffic projections established yet for the Sava river basin. However, there are indications of significant transport potential in the years to come. Studies therefore need to be carried out to provide an indication of river traffic growth and potential revenues.
The SEETO’s MAP 2007-2011 points to the need to improve Sava River navigability to ensure the connectivity of Bosnia and Herzegovina and Croatia.
Provided navigation conditions are improved, major traffic is expected to be generated by local and foreign industries in the greater river catchment area, such as, for example, the timber industry in Slavonski Brod, the chemical industry in Serbia, the steel industry in Central Bosnia, and also from the tourism industry, which is strongly interested in Sava river development.
2.1.3. SWOT analysis
63 The ETCS should guarantee fast, dense and safe border-crossing high speed train operation at European level.
48 The following analysis of strengths, weaknesses, opportunities and threats (SWOT) summarises what has been discussed in sections 2.1.1 and 2.1.2, but is restricted to the rail and inland waterway sub-sectors, given the planned concentration of IPA resources in this OP.
SWOT profile - Railways
Summary statement: The strength of the Croatian railways is its carrying capacity, as well as its energy efficiency when compared to competing road transporters64. Network size can be viewed as both a strength and a weakness, the latter because of the problem of unprofitable line services. Due to poor network conditions and past under-funding of the railways, the efficiency of operations has been compromised and the network suffers from permanent speed restrictions (see discussions under section 2.1.1), train cancellations and delays.
Operational problems are symptomatic for the whole SEE Core Regional Railway Network: According to latest information65, 65 % of the Core Network suffers from mandatory speed restrictions.
The railways nevertheless are increasingly oriented towards market needs, and are considering multi-modal transport (including Ro-La) as a future market opportunity; market penetration will depend on the railways’ competitiveness. Growing car ownership represents a serious challenge to alternative transport modes, as it is generally coupled with increased service expectations.
STRENGTHS
INFRASTRUCTURE • Favourable geographic network positioning for development of international traffic as part of the Pan-European transport corridors X, V and VII; • Well connected to urban and sub-urban centres; • Well connected to commercial maritime ports; • Croatia and its surrounding countries have the same gauge size; • Availability of intermodal (Ro-La) freight terminal at border (Spačva); • Joint border crossing points with Hungary and Slovenia.
OPERATIONS • High volume mode of transport for bulk commodities; • Safe, energy-efficient and environmentally friendly mode of transport; • Less dependency on weather conditions than alternative modes; • Availability of multi-modal transport facilities (focus on Ro-La); • Investment in modern fleet components (tilting trains for passenger services); • Bilateral agreements on cross-border traffic between Croatia and surrounding countries.
FINANCE • Gradual increase of revenue base, due to an increase in transport volume in both passenger and freight sectors; As a consequence, there have been decreasing requirements for state budget support; • Increasing commercial freedom as regards pricing policy; • Concessionaire system in place (for motorways’ construction and operation).
64 The ratio of energy consumption is about 4:1 in favour of the railways, assuming same travel speed (Source: World Bank Working Papers 634 “Railways and Energy”. 65 SEETO MAP 2007-2011
49 MANAGEMENT / ADMINISTRATION • Advanced structural adjustment process concerning the Croatian Railways, aimed at the creation of a new railway holding; • Increased recognition of modern services requirements; • MSTTD’s specific promotion scheme for multi-modal transports.
LEGAL TRANSPOSITION OF EU RAILWAY LEGISLATION • Gradual successful alignment with EU transport acquis requirements; • Railways Act of 1994 (amended in 1998) has initiated the first phase of restructuring HŽ from the former state- owned company into a public limited company (the new “Law on Division of HŽ” of January 2006 opens the way for the creation of a new railway holding structure). • Railways Act of July 2003 opens the way for separation of infrastructure management and train operations and the new “Law on Division of HŽ” of January 2006 for the creation of a new railway holding structure. • New Railway Safety Act being drafted.
WEAKNESSES
INFRASTRUCTURE • Network limitations (rigidity) as far as area coverage is concerned; • Single track line segments on arterial line sections; • Croatian electric traction system (25 KW) is different form the one in neighbouring Slovenia - a technical barrier to interoperability.
OPERATIONS • Inadequate rolling stock, particularly in view of the demand and quality standards; • Outdated signalling and telecommunications system; • A change of locomotives is necessary at all the borders; • Low commercial speeds, due to lack of investment in modernisation of the system; • The dilapidated state and poor maintenance of the rolling stock is the main reason for frequent breakdowns, affecting both the infrastructure and trains and causing irregularities and delays. In consequence, users - particularly in passenger transport - frequently turn to other modes of transport; • New laws distance operations, but new companies still have weak commercial objectives (concepts); • No private sector involvement in rehabilitation or maintenance; • Organisational structures are still overly based on a traditional concept of the market (sellers’ market); • To date, no open access to the railway market, because required legal implementation requirements have not yet been determined; • Insufficient reliability (arrival on time)
FINANCE • Limited self-financing power; • Negative business result (loss making); • Decreasing budgetary sources for local passenger transport (local lines) with the consequence of possible line closures; • Non-profitable line segments in operation; • Non-sustainable transport cost reimbursement scheme of costs of railway subsidiary AGIT ltd engaged in combined transport.
MANAGEMENT / ADMINISTRATION • Little or no divestment of ancillary businesses (17 dependent companies are majority owned by HŽ); • No private participation in ancillary business;
50 • At present, Croatia lacks institutions which are a pre-requisite for market opening: licensing authority, regulatory authority, safety authority, infrastructure manager, capacity allocation body, charging body and notified body, whereby the most urgent are the independent regulatory body and the independent infrastructure manager; • Staffing problems within the management structure – constant lack of adequately trained staff; • Still underdeveloped administrative capacities
LEGAL TRANSPOSITION OF EU RAILWAY LEGISLATION • New laws have been passed in accordance with the transport acquis, but there are still legal and institutional gaps, and a lack of subordinate legislation and implementation.
OPPORTUNITIES
• To harmonise the Croatian network and operations capability with European norms and practice; • To increase the quality of services, railway productivity and efficiency, using European benchmarks and best practices; • To develop railway network and services in line with the concept of sustainable transport; • To further implement the concept of modern “logistics-chain management” and inter-modal transport; • To regain market shares in passenger and freight transport, and especially create a new market for the railways for long distance travel along the Corridors X, Vb and Vc; • To improve, stabilise and consolidate the railways’ financial situation; • To respond to the increasingly tight financial situation in the local passenger transport field by developing cooperation models together with the local authorities; • To contribute to the stabilisation of political and economic circumstances in the wider area; • To support the ongoing urbanisation and urban migration trends by providing adequate urban, sub-urban and intercity services; • To fully take advantage of the increase in urban, sub-urban and intercity transport demand; • To contribute to and profit from the revitalisation of domestic sea ports and Vukovar port; • To attract private sector finance for railways systems improvement.
THREATS
• Lack of substantial investment will reduce the competitive edge of railway transport to the benefit of other modes of transport and, in international transport, such a situation will prove beneficial to foreign railway companies, as well as to other competing modes, in particular road transport; • Croatia loses out in international corridor competition; • Relatively short project implementation period (the N+3 rule).
SWOT profile - Inland waterways
In summary: the advantage of river transport is its large transport capacity, albeit at low commercial speeds. The main argument for shippers to choose the inland waterway mode is the unit cost advantage, particularly for bulk commodities such as raw materials, oil and oil products, ores and metals and chemicals, all of them however representing markets on which the railways are a competitor. Factors working against river transport are that water levels fluctuate according to weather conditions, representing an element of uncertainty and leading to economic constraints. Environmental protection is a major reason for favouring waterway transport from a public policy perspective, but dangerous goods transport is a potential threat to water quality. Multi-modal transport can be considered a future business opportunity.
51 STRENGTHS
• High volume mode of transport for bulk commodities; • Safe, energy efficient and environmentally-friendly mode of transport; • Traffic can be operated 24 hours a day, 7 days a week, which enables great flexibility of scheduling operations; • Privatisation process in ports completed by separating administrative functions from commercial operations; • Commercialisation of port operations has taken place; • Concessionaire system in place; • Charging port fees (wharf usage) aligned with EU practice; • Cost recovery fully operated through tariffs; • Widespread private sector participation; • Commercialised maintenance operations; • Concluded “Framework Agreement on the Sava River Basin” including all riparian states and establishment of Sava River Committee, mandated with Sava river development; • Good progress in alignment with international and EU legislation.
WEAKNESSES
• Physical navigation obstacles leading to navigation hazards; • Insufficient maintenance and outdated infrastructure of waterways and river ports; • Relatively low commercial speed and hence, long travelling time; • Insufficient reliability (arrival on time) due to insufficiently developed fairway; • Short navigation periods due to difficult hydro-meteorological conditions (low water levels, fog, etc.); • Limited consultation in investment planning; • Gaps in compliance with EU transport acquis (mutual recognition of documents); • No contingency plans developed for serious pollution cases; • Outdated system of signalling in place; • Dangerous goods transport potential threat to water quality; • Low market share; • Staffing problems within the management structure – lack of adequately trained staff; • Relatively underdeveloped administrative capacities.
OPPORTUNITIES
• To re-establish an internationally acceptable navigation regime, navigation safety and bring the waterway up to IV category level; • To harmonise the Croatian network and operations ability with European norms and practice; • To render river transport again an attractive alternative and create traffic diversion effects: congestion of land travel can be avoided by transferring cargo with high affinity to waterway transport from roads to inland waterways; • To advance multi-modal transport solutions by improving transhipment nodes and facilities (river ports); • To take the necessary action to involve private sector into the rehabilitation of the waterway and the revival of commercial shipping; • To create synergies between the Danube waterway and Sava river basin development, taking into consideration the results of the 3rd Pan European Transport Conference, according to which the Corridor VII refers also to the Danube–Sava link as part of the relevant inland waterway system; • To revitalise the Sava River basin economy and promote industry settlement in the river vicinity, including navigable tributaries; • To increase the quality of services, productivity and efficiency, using European benchmarks and best practices; • To develop the river basin in line with the concept of sustainable transport;
52 • To further the concept of modern “logistics-chain management” and intermodal transport; • To regain market shares in freight transport in river commodity markets; • To launch river tourism and tourist industry in the river basin; • To improve, stabilise and consolidate the river port authorities’ financial situation; • NAIADES – European action plan for Inland navigation66.
THREATS
• Capacities are insufficiently used; • Some of the infrastructure projects, especially on the Drava river, could provoke harmful consequences on the existing environment (soil, natural habitats) - these concerns will be taken into account during future EIAs; • Lack of substantial investment will further degrade river services to an absolutely marginal level of importance within the Croatian and regional transport system, very much to the benefit of road transport with related ill-effects of traffic congestion and air pollution; • Lack of funding will leave the development potential of the Sava river basin unexploited; • Specific interests of gravel extraction and transportation companies • Uncontrolled exploitation in cross border area with Bosnia and Herzegovina • Relatively short project implementation period (the N+3 rule).
There are a number of common issues that emerge throughout the SWOT, namely: • Poor infrastructure condition as a result of more than a decades of no investments; • Low infrastructure capacity usage; • Urgent need for substantial investments in infrastructure; • Strong potential for traffic growth; • Problems with staffing and capacity building; • A stronger cooperation between sub-sectors already initiated (Ports of Vukovar, Sisak and Slavonski Brod); • International cooperation intensifying in both sub-sectors.
2.1.4. Medium term needs and objectives in the Railway
Future investments will primarily be made in Pan-European Corridors Vb, Vc, and X, in order to achieve their inter- operability in accordance with directives given by the European Union, and to make them attractive to other operators and transport organisers. After the planned infrastructure upgrade, the following train speeds will be possible: • international railways (corridor railways) 160 km/h • regional railways 120 km/h • local railways 80 km/h
These characteristics and speeds (for international railways) are primarily planned on the railway section Oštarije - Knin – Split and on the following Pan-European corridors and branches: • X Savski Marof - Zagreb - Vinkovci - Tovarnik • Vb Rijeka - Zagreb - Botovo • Vc Ploče - Metković and Beli Manastir - Osijek - Vrpolje - Šamac
In line with the draft of Croatian Railways Group five year plan which serves as a basis for the preparation of the National program for modernisation of railway infrastructure, and other national programming documents, the medium term needs and objectives in this sector are:
• An increase of volume and quality of transport, together with planned reduction of employees in line with modernisation and improved quality of performance,
66 The new NAIADES programme will try to foster inland waterway transport as an environmentally-friendly alternative to road freight. The action plan will tackle the sector's poor image and infrastructure problems.
53 • Investment in infrastructure, especially in the modernisation and construction of railway lines of international importance (Corridor X,Vb,Vb1 and Vc), • Investment in transportation; procurement of new motor units, freight and passenger wagons, multipurpose and shunting locomotives and modernisation of traction units, i.e. investments aiming at increased volume and quality of freight and passenger transport, • Better regional, economic and transport linkage within the Republic of Croatia, especially better linkage of Croatian ports with the railway infrastructure • Better linkage of the national railway system with neighbouring countries • Dealing with the issue of suburban transport in major towns (expanding Zagreb's suburban transport, system and the implementation of suburban transport systems in Rijeka, Split and Osijek)
2.1.5. Medium term needs and objectives in the River Transport
In line with the drafts of the 5 year plans for inland waterways and Inland Ports, and other national programming documents, the medium term needs and objectives in this sector are: • Establishment of internationally-classed waterways (Danube, Drava, Sava) in accordance with the European Agreement on Major Inland Waterways of an International Level (AGN) • Increase the share of inland waterway transport sub-sector with respect to other modes of transportation, with a considerable share of the transit transport of general cargo, containers and RO- RO transportation • Modernisation of the fleet to adapt it to the new transport and environmental requirements. • Implementation of favourable conditions for multimodal transport development • The promotion of jobs, skills and knowledge of waterway activities • Guaranteeing people’s safety and ensuring environmental protection.
The Accession Partnership (Transport sector), highlights the short-term and medium-term priorities. The medium term priority identified for the in inland waterway sector is: • Work towards alignment with the EU acquis in the area of inland waterway transport, in particular with regard to navigational safety and River Information Services. In terms of the Accession Partnership, the TOP will contribute to the medium-term priority – preparation of projects for investments in upgrading the internationally-classed waterways and port infrastructure. Inland waterway development is identified in the Strategic Coherence Framework 2007-2013, as one of two priority objectives to be financed under the scope of IPA assistance. Priorities identified under the Multi-annual Indicative Planning Document (MIPD) are acquis-related investments in improving and modernising the inland waterway network to European standards along Corridor VII. On the basis of the 1999 Transport strategy and other sectoral documents the Republic of Croatia is investing in the ports and inland waterways. In addition to the regular maintenance of navigable ways, a bank revetment project is to be carried out on the Danube, and a water regulation facility is to be built to regulate the navigable passage to upstream of the Drava mouth. River bed stabilisation activities are planned on the Drava river; the old riverbed will be closed and a basin-type port will be built in the Nemetin port zone. In addition to regular maintenance of the Sava river, it is planned to upgrade the Sava waterway to Category IV, together with Bosnia and Herzegovina and the Sava Commission. The most significant enterprise is the construction of a new port in Vukovar, given the substantial damage to the old port during the war. (The port has been upgraded in the last five years). In addition to regular maintenance activities, the documentation for further development activities is currently being prepared for the ports of Sisak, Slavonski Brod and Osijek. The port of Osijek is building a basin-type port in the Nemetin area, the port of Sisak is preparing the master plan, and the port of Slavonski Brod is continuing with the construction of the waterfront and multimodal terminal.
54 2.2. STRATEGIC PRIORITIES
The present TOP is based on the MIPD and SCF strategy and objectives outlined in section 1.2 above, which in turn reflect the EU policy guidelines laid down in the “White Paper: European transport policy for 2010: time to decide” (COM (2001) 370 final). The TOP, addressing the weaknesses identified in the SWOT analysis above, is focused on infrastructure/operations improvements in the railway and inland waterway networks.
Accordingly, the strategic approach taken in the TOP aims at:
9 network integration, increased/ improved interoperability and at quality levels in the Croatian network which meet EU standards, with emphasis being on the railway network and inland waterway system;
9 making use of the comparative economic and environmental advantages of rail and waterway transport which is to carry dense flows of reasonably homogenous traffic over longer distances, whether passenger or freight.
Current energy trends are reinforcing the comparative advantage of rail and waterways against road transport and, hence, are supportive of the strategic choice made in favour of rail and inland waterways. The opportunities in railway and waterway traffic, however, will largely depend on factors such as access costs, speed and route conditions, equipment used and most importantly, the load (utilisation) factor.
The concentration on railways and inland waterways takes its justification from following further considerations:
• The need to concentrate the limited available funds for maximum effect and leverage. • To integrate major trunk lines (corridors) into the European railway network and to establish a harmonised operating standard across borders. • To re-balance sector spending and strengthen the railways inter-modal and international competitiveness. • To regain market share for the railways in the freight transport sector and respond to major changes in the trade pattern and commodity structure, as well as to encourage investment in new technology (in 2005, the railways’ share in total goods traffic and passenger traffic amounted to 12.7% and 33.7% respectively) • To succeed in moving goods transport off the roads; this will depend principally on improving railway services. • To establish, maintain and improve conditions for safe and reliable inland navigation • To maintain international waterways according to the required international navigational class standard • To equip international ports with facilities for the collection and treatment of human waste and the removal of silt from ports. • To adjust to the technical parameters of Trans-European network requirements. • To meet environmental concerns which have an increasingly important influence on transport policy. One policy target is to shift long-distance road journeys and cargo onto the railways as an energy–saving, clean and safe mode of transport, and to make the railways an integral part of the modern multi-modal distribution chain.
In summary, the present TOP puts emphasis on the revitalisation of the railways and waterways of Croatia, in an effort to counteract existing development difficulties within the Croatian transport sector. This approach reflects the strategy of sectoral sustainability adopted by the European Council in Gothenburg in June 2001.
Moreover, in order to guarantee the most efficient use of funds, it is intended to achieve complementarity with other related ISPA and IPA interventions, as well as relevant IFI projects (as shown in section 3.4).
55 3. PROGRAMME STRATEGY
3.1. PRIORITY AXES AND MEASURES
3.1.1. IPA objectives and priority axes
The aim of the Transport OP is to select projects which best fit the OP’s objectives, while spreading the benefits of learning from the systems and practices of IPA management, as IPA uses processes of project and programme management which are closer to Structural Fund programme and project management than previous EU pre- accession funds. The IPA objectives and priorities must be in line with strategic directions identified in the Accession Partnership and National 1999 Transport Development Strategy. Therefore, the main objective of the TOP is to invest in projects which will have the greatest impact on the modernisation of the railway lines and, in parallel, to prepare projects for future investments in upgrading and improving the inland waterway sector, since, at this time, there is a lack of suitably mature projects that could be implemented during this Operational Programme period. Finally the aim is to develop the administrative and management capacity of those institutions implementing the TOP. Implementing the TOP measures will produce direct development benefits such as a reduction in the time taken to shift freight, increasing the safety of journeys, and making inland waterways more competitive and less expensive in relation to other transport modes.
Following the strategic direction given by the MIPD and, subsequently, the SCF, the TOP proposes measures (and major projects) under three priority axes:
PRIORITY AXIS 1 Upgrading Croatia’s rail transport system
Measure 1.1 Line upgrading and modernisation
Measure 1.2 Improvement of the safety and efficiency of railway operations
PRIORITY AXIS 2 Upgrading Croatia’s inland waterway system
Measure 2.1 Modernisation and rehabilitation of river waterways and port infrastructure
PRIORITY AXIS 3 Technical assistance (TA) Technical assistance for OP management, identifying future projects, capacity Measure 3.1 building and preparing future Operational Programmes
3.1.2. Selection criteria
In general terms, project selection criteria are based, on the one hand, on specific IPA criteria for the transport sector, listed in Article 147 of the IPA Implementing Regulation (sustainable traffic flow, better connections and inter- operability within networks) and, on the other hand, on the principles and criteria set out in the Decision No. 1692/96/EC made on July 23, 1996 by the European Parliament and the Council of Ministers, on Community Guidelines for the Development of the Trans-European Transport Network67
General criteria
After gathering, as a first step, all potentially eligible projects on the proposed corridors and transport modes, projects that could not satisfy the following general screening criteria have been eliminated from further consideration (in order of priority):
• The project should bear a very high relevance to the SEE Core Regional Transport Network;
67 Official Journal of the European Communities, L, No. 228, September 9, 1999, p. 1.
56 • The financial plan should be realistic, including the question of secondary investment cost (maintenance) coverage, and show in particular the division between national and outside financing; • The project should show sufficient maturity, taking due account of administrative/legal barriers concerning project implementation (land acquisition problems, right of way etc); • The project should be of sufficient size and significance; • The project should in no way duplicate third party efforts, but should match other projects of a complementary nature in order to achieve synergies; • There should be a visible commitment by the national government or regional bodies (such as SEETO and /or Sava River Commission) to implement the project; projects therefore should be given preference according to their inclusion in related and previously agreed priority project lists (example REBIS; ISPA) • The project should provide modal balance and contribute to environmental protection • The basic technical features of the project should be more cost-efficient (demand oriented) in reaching the strategic objectives than alternative technical options, and should be appropriate and correspond to international standards.
Generally all of the priority projects (except for project number 1) which have been pre-selected and included in the indicative project list for 2007-2009 (section 3.5) are at an early stage of project preparation, requiring technical, economic and, if necessary, environmental studies.
Therefore, in a second appraisal stage, proposed priority projects will be checked against the following screening parameters:
Specific Criteria
Proposed projects will be checked to ensure the completeness of the following standard preparatory activities, which should be carried out before submitting projects for approval to the Project Selection Committee (and subsequently the European Commission, in the case of major projects):
• Pre-feasibility study; including preliminary financial and economic analysis and calculation of Financial Internal Rate of Return (FIRR) and Economic Internal Rate of Return (EIRR); eventual preliminary drawings; • Availability of co-financing, including possible involvement of IFIs; • Detailed feasibility study, including financial and economic analyses (FIRR & EIRR) which take into account societal (external) effects; cost benefit analyses, affordability analyses, preliminary and detailed technical designs; operation plans etc • Environmental impact assessment (EIA), if needed according to Croatian and European regulations; • Reports on consultations with interested/affected parties; • Approvals and permits obtained (for example construction permits, environmental permits, rights of land etc) • Satisfactory completion of all parts of the IPA application form (EC ‘major projects’ template, in the case of projects over €10m)
The objective of the second phase screening process is to identify the most feasible projects and those projects having the most immediate and significant impact in terms of: • readiness for implementation (maturity) • improving transport efficiency; • guaranteeing financial and environmental sustainability; • improving transport safety and security.
As far as possible the impact will be assessed in monetary terms, and subjected to a sensitivity analysis. Major Projects will be prepared in accordance with articles 150 and 157 of the IPA Implementing Regulation. Only projects with a sufficiently high rate of return (FIRR; EIRR) will be considered for implementation.
Finally, two legal and financial considerations will be taken into account in assessing the applications: first, an understanding and undertaking that the infrastructure will remain public property, and second, the availability of
57 budgetary resources to ensure Croatian co-financing of the projects, and their sustainability (operation and maintenance) beyond the funding period.
The TOP priority axes and measures proposed below, through which the TOP's strategic objective is to be implemented, are considered the most beneficial for railway and river network development on the one hand, and for society and the environment on the other, while meeting the EU transport acquis obligations..
Revenue generating projects
Revenue generating projects as defined in Article 150 of the IPA Implementing Regulation are operation(s) proposed for pre-accession assistance involving an investment in infrastructure, the use of which is subject to charges borne directly by users and which generates revenues, or any operation involving the sale or rent of land or buildings.
3.1.3 Priority axis 1 - Upgrading Croatia’s rail transport system
Aim:
The aim of this priority axis is to develop the railway transport infrastructure in Croatia, concerning in particular the interconnection and interoperability of national networks and with trans-European networks. It aims to gradually improve the quality of the railway along TEN Corridor X within Croatia, in order that it increasingly meets EU standards.
Community legislation
Activities under this priority axis are designed to modernise railway infrastructure and assist Croatia in meeting its obligations related to implementation of the EU transport acquis governing the railway system, namely:
- Directive 91/440/EEC on the development of the Community's railways - Directive 2001/12/EC of the European Parliament and of the Council of 26 February 2001 amending Council Directive 91/440/EEC on the development of the Community's railways - Directive 2001/13/EC of the European Parliament and of the Council of 26 February 2001 on the licensing of railway undertakings - Directive 2001/14/EC on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure and safety certification. (Railway Safety Directive) - Directive 2004/49/EC of the European Parliament and of the Council of 29 April 2004 on safety on the Community's railways and amending Council Directive 95/18/EC on the licensing of railway undertakings and - Directive 2004/50/EC of the European Parliament and of the Council of 29 April 2004 amending Council Directive 96/48/EC on the interoperability of the trans-European high-speed rail system and Directive 2001/16/EC of the European Parliament and of the Council on the interoperability of the trans-European conventional rail system, - Directive 2004/51/EC of the European Parliament and of the Council of 29 April 2004 amending Council Directive 91/440/EEC on the development of the Community's railways.
Specific objectives
The objective of this priority is to gradually improve the quality of the railway along TEN Corridor X within Croatia, in order that it increasingly meets EU standards. Specifically, the objectives are: • rehabilitation / upgrade of specific line sections along TEN Corridor X, showing the lowest performance indicators • reconstruction and modernisation of railway stations to meet EU standards in terms of track lengths and layout, as well as signalling and telecommunication equipment
58 Rationale
The priority axis is intended to help Croatia meet its needs and its obligation to meet EU standards, specifically in the context of managing changes in transport demand on Corridor X. As demonstrated in section 2, the rail sector has suffered from war damage, and the infrastructure requires modernisation in order to create an efficient and environmentally friendly mode of transport.
The intervention is needed to ensure the rail network can engage successfully in inter-regional and intra-regional corridor competition and is able to capture significant parts of future regional traffic potential. Moreover, increasing the railways’ market share in international goods and passenger traffic on Corridor X is a pre-requisite for rendering line investments and railway operations financially feasible, thereby making the railway system commercially attractive for private operators.
Corridor X is a double track main railway line from Savski Marof – Zagreb Main Station – Novska – Tovarnik which connects central and south-eastern Europe, from Salzburg, via Ljubljana, Zagreb, Belgrade and Skopje, to the port of Thessaloniki. As far as traffic is concerned, it represents the backbone of railway traffic from east to west on which almost all north-south lines and lines from Bosnia and Herzegovina are connected. Within Croatia, this line connects significant industrial and agricultural areas.
During the 1990's, events on the territory of the former Yugoslavia brought about a significant drop in freight and passenger traffic which was, to a great part, redirected into alternative traffic corridors. Transit traffic on Corridor X was completely disrupted for more than five years. In the last few years, Croatian Railways Infrastructure has registered an increase in traffic on Corridor X.
The total length of Corridor X is 2,528.2 km, of which 1,622.7 km (64.2%) are single track and 905.5 km (35.8%) are double track. Of the total length of all the lines on the corridor, 2,244.5 km (88.7%) are electrified. It is planned that by the year 2010, there will be 1,461.3 km (57.8%) single track lines, 1,066.9 km (42.2%) double track lines and 2,348.7 km (92.9%) electrified lines.
Description
The priority axis will support two measures: to upgrade and modernise the line, and to improve safety and efficiency on Corridor X. This implies: ¾ increasing travel speed to 160km/hour; ¾ increasing axle load to 225 kN; ¾ adjusting station platform lengths (for a TEN route it is 400m); ¾ installing the European Railway Train Management System (ERTMS) to ETCS level 1, which refers to the overlaying of the trackside conventional signalling system with fixed ETCS infrastructure as a first step to full ERTMS. ¾ installing/upgrading trackside telecommunication equipment; ¾ installing/upgrading the overhead power supply system; ¾ installing/improving the permanent way drainage system; ¾ installing automatic half or full barrier level crossings; Targeting
This priority axis will apply to the railway sector of the TOP, contributing to the TOP’s objective to “Rehabilitate and develop a railway network in Croatia to respond to the expected increase in demand for railway transport, especially on the Pan-European corridor X”. The priority axis is targeted at: • Improvement and rehabilitation of the railway network • Improvement of safety conditions of the railway system • Assisting Croatia in meeting its obligations to implement the EU transport acquis governing the railway system
59 Measures
Two measures are proposed under this priority axis: • Measure 1.1. Line up-grading and modernisation Projects under this measure will focus on the improvement of the permanent track and overhead power supply system and on the preparation of project documentation • Measure 1.2. Improvement of the safety and efficiency of railway operations Projects under this measure will concentrate on the modernisation of trackside infrastructure, signalling telecommunication, safety and security equipment.
Delivery The operations (projects) that will be financed under Priority axis 1 will be selected from the Indicative project list provided in Chapter 3.5 of the Operational Programme (and respective project identification cards attached as Annex 2) in accordance with the general and measure-specific selection criteria provided in the Operational Programme. The selected operations will then be submitted to the European Commission for approval. If a project is appraised as acceptable the European Commission will issue a decision on the approval for each project which will define the physical object and the eligible expenditure to which the co-financing rate for the priority axis applies. Finally, for each approved project a Financing Agreement between the European Commission and the beneficiary country will be signed, laying down those elements. Complementary funding for these investments will be ensured from national funding, external loans and other sources and models of funding.
In the case of projects that do not fall under the title of “major projects” (i.e. that are under the 10 m€ threshold) the decision on competing calls will be made by the Selection Committee, based on the selection criteria described in the Operational Programme and confirmed by the Sectoral Monitoring Committee.
Targets and Indicators
Table 2 – Indicators for Priority axis 1
unit unit Type (by 2012) Definition Definition reviewing Data dates Data dates Final target Data source Frequency of of Frequency Measurement Measurement Baseline data
Increased average Croatian 1 train speed on the Result km/h 70 2006 annually 103 Railways Corridor X Time-table Passenger interviews, Improved passenger Minutes / Statistical 2 trains compliance with Result train 9 2006 annually 6 yearbook of time table delayed Croatian Railways Tonnes Statistical Increased freight (1,000s, 2.691 3.495 yearbook of 3 Result 2006 annually volume Tonne km 939 1.353 Croatian (mil.) Railways
Financial allocation and co-financing rate
Out of the total allocation for the Transport OP that amounts in total to € 53,500,500, the allocation for Priority Axis 1 is € 12,995,250 in 2007, € 15,870,000 in 2008 and € 18,245,250 in 2009 (in total € 47,110,500).
For the railway sector it is proposed to set the national co-financing rate at 25%, with a 75% rate of IPA co-financing.
60 3.1.3.1. Measures under Priority axis 1 - Railway network rehabilitation and development
Measure 1.1: Line up-grading and modernisation Specific objective
The objective is to gradually increase and improve interoperability along Corridor X, in accordance with UIC standards and railway interoperability requirements based on Directive 2001/16/EC
Rationale
The total length of the line on Corridor X from the state border with Slovenia, via Zagreb, Dugo Selo and Vinkovci to the state border with Serbia is 316.7 km long. From the Slovenian border to Zagreb (26.7 km) to Dugo Selo (21.25 km), to Novska (83.4 km) of single track line, and from Novska to the border with Serbia at Tovarnik (185.4 km). All tracks are electrified with the AC 25kV/50Hz system, and have automatic block interlocking, while the stations have installed relay devices on which mixed traffic is run.
The section between the Slovenian border and Zagreb has a double track line along its entire length, on which performance speeds of up to 160km/h are achieved, with the exception of specific areas west of Zaprešić and on the Zaprešić – Podsused Tvornica section. On this section the curve radii limit speeds to 100 - 120 km/h, while on the track section to Zagreb West Station and to Zagreb Main Station speeds are limited to 70 km/h.
The section between Zagreb and Dugo Selo has a double track line along its entire length and performance speeds are up to 160 km/h, with the exception of individual sections of curved track on which speeds are limited. In Zagreb Main station speeds are limited to 50 km/h, at the entrance to the Sesvete station to 120 km/h, and on the Sesvete – Dugo Selo section to 130 km/h. The braking distance on the track is 700 m on the Sesvete – Zagreb MS section, and 1,000 m on the Dugo Selo – Sesvete section.
The section between Dugo Selo and Novska has a single track line and performance speeds are up to 130 km/h, with the exception of individual sections of curved track on which speeds are limited. This occurs primarily at the entrance and exit to stations.
The section between Novska and the State border has a double track line along its entire length and performance speeds are up to 160 km/h, with the exception of individual sections of curved track where speeds are limited to between 80 to 140 km/h. This is primarily the case at the entrance and exit to stations. The braking distance on the track comes to 1,000 m on the State Border – Tovarnik – Ivankovo section, and to 1,500 m on the Ivankovo – Novska section.
Under the ISPA program the section from Vinkovci to Tovarnik to the State border will be rehabilitated so that the performance speed will be up to 160 km/h, through the removal of infrastructural restrictions for speed limits, such as tight curves and inadequate stations.
Description
The measure will build on interventions already planned and underway under the ISPA programme, and will focus on modernising the weakest portions of the line, in terms of existing assessments of operational standards, contained in the SEETO MAP 2007-11. This measure will encompass projects concerning the permanent way, fixed structures, installations and equipment (see section 3.5 for indicative list of priority projects).
Eligible actions
Assistance under this measure refers to procurement contracts. The activities under this measure are aimed at the rehabilitation of the permanent track; bridges and level crossings, overhead power supply and modernisation of stations. The assistance will include supervision services, implementation support, consultancy services, tender evaluation, project preparation for previously identified projects, project monitoring and evaluation.
61
Selection criteria
Bearing in mind the general and specific selection criteria listed in chapter 3.1.2., the following criteria were applied to identify the most feasible projects and those having the most immediate and significant impact under Measure 1.1.: • readiness for implementation (maturity), taking into consideration administrative/legal barriers concerning project implementation (land acquisition problems, right of way etc); • improving transport efficiency by increasing the speed and line capacity; • improving transport safety and security.
Final Beneficiaries
The final beneficiary for measure 1.1 will be Croatian Railway Infrastructure Ltd.
Monitoring indicators:
Table 3 – Monitoring indicators for the Measure 1.1
Type nt unit nt unit source Baseline (by 2012) Definition Definition Data dates Data dates Frequency Final target Measureme Data source of reviewing of reviewing Km of track upgraded Project 1 to achieve average Output Track km 0 2007 annually 19.5 monitoring speed of 160 km/h reports Bridges and culverts Project 2 rehabilitated to attain Output Number 0 2007 annually 33 monitoring speed of 160 km/h reports Catenary rehabilitated Project 3 to attain speed 160 Output Track km 0 2007 annually 19.5 monitoring km/h reports Project applications Project 4 submitted with full set Output Number 0 2007 annually 2 monitoring of documentation reports
Measure 1.2: Improvement of the safety and efficiency of railway operations
Specific objective
The objective is to improve the quality, reliability and efficiency of railway services along Corridor X. This will concern mainly signalling and communications improvements and adjustment to the technical parameters of Trans-European network requirements. Rationale: Due to inadequate and insufficient maintenance over the last 20 years, signalling and telecommunications equipment along Corridor X has not been upgraded and/or replaced on a regular basis in order to extend the lifecycle and to meet up-to-date standards. For this reason speed restrictions were introduced to maintain safety at an acceptable level. As a consequence of speed restrictions and increased maintenance requirements, the efficiency of the railway system has deteriorated.
Description
Projects under this measure will focus on the modernisation of signalling and telecommunications systems to enable the installation of ETCS and centralised traffic control equipment in order allow for the integration of the railway network in Croatia with the network in the European Union. The measure will focus on improving the signalling for
62 160km/h train speeds, and on the restoration and upgrading of existing Automatic Train Protection (ATP) safety devices and the restoration of the line-side telephone system infrastructure.
Eligible actions
Assistance under this measure refers to procurement contracts. The activities under this measure are aimed at the improvement of trackside infrastructure; signalling, telecommunications, safety and security equipment. The assistance will include supervision services, implementation support, consultancy services, tender evaluation, project preparation for previously identified projects, project monitoring and evaluation.
Selection criteria
Bearing in mind the general and specific selection criteria listed in chapter 3.1.2., the following criteria will be applied to the selection of projects under Measure 1.2.: • improving transport safety and security; • the impact and the importance for the entire network; • readiness for implementation (maturity), taking due account of administrative/legal barriers concerning project implementation (land acquisition problems, right of way etc); • improving transport efficiency.
Zagreb Main Station, with the highest frequency of trains, is the main railway junction for inter-city and long distance passenger transport in Croatia, on the intersection of X and Vb Corridors. The station is equipped with relay fail-safe signalling equipment, which was installed in 1940. The speed within the station is currently reduced to 30 km/h, due to the condition of the signalling equipment. In addition, the unavailability of spare parts for such obsolete equipment makes technical maintenance very difficult and expensive.
Final Beneficiaries
The final beneficiary for the measure 1.2 will be Croatian Railways Infrastructure Ltd.
Monitoring indicators
Table 4 – Monitoring indicators for the Measure 1.2
data Type nt unit nt unit Baseline (by 2012) Definition Definition Data dates Data dates Frequency Final target Measureme Data source of reviewing of reviewing Installed and operational Project 1 solid state signalling & Output sets 0 2007 annually 1 monitoring interlocking system reports Project New main & distant 1.a Output pcs 0 2007 annually 47 monitoring signals installed reports Project New shunting signals 1.b Output pcs 0 2007 annually 77 monitoring installed reports Project New electro-hydraulic 1.c Output pcs 0 2007 annually 98 monitoring point machines installed reports
3.1.4. Priority axis 2 - Upgrading Croatia’s inland waterway system
63 Aim:
The aim is to rehabilitate the Sava river waterway with a view to achieving category IV navigational status, including alignment with the EU River Information System’s (RIS) and with the port system in the Republic of Croatia. This axis will comply with Directive 2005/44/EC which aims at the build-up of a European data exchange platform for easy and up-to-date transmission of traffic information (such as fairway conditions etc) from river authorities to operators, and will improve the inter-phasing of the waterway sub-sector with other modes of transport.
Community legislation
Activities under this priority axis are designed to improve the inland waterway system and assist Croatia in meeting its obligations related to implementation of the EU Transport acquis governing inland waterway system, namely:
• Council Regulation (EC) No 1356/96 on common rules applicable to the transport of goods or passengers by inland waterway between Member States with a view to establishing freedom to provide such transport services. • Council Regulation (EEC) No 3921/91 laying down the conditions under which non-resident carriers may transport goods or passengers by inland waterway within a Member State • Council Regulation (EC) No 718/99 of 29 March 1999, on a Community fleet capacity policy to promote inland waterway transport • Council Directive (EC) No 96/75 on the systems of chartering and pricing in national and international inland waterway transport in the Community • Council Regulation (EEC) No 2919/85 laying down the conditions for access to the arrangements under the Revised Convention for the navigation of the Rhine relating to vessels belonging to the Rhine Navigation • Council Directive (EEC) No 87/540 on access to the occupation of carrier of goods by waterway in national and international transport and on the mutual recognition of diplomas, certificates and other evidence of formal qualifications for this occupation • Council Directive (EEC) 91/672 on the reciprocal recognition of national boat masters certificates for the carriage of goods and passengers by inland waterways • Council Directive (EC) No 96/50 on the harmonisation of the conditions for obtaining national boat masters certificates for the carriage of goods and passengers by inland waterway in the Community • Council Directive (EEC) No 76/135 on reciprocal recognition of navigability licences for inland waterway vessels, amended by Council Directive 78/1016/EEC modifying Council Directive 76/135/EEC • Council directive (EEC) No 82/714 laying down technical requirements for inland waterway vessels. The requirements for granting a ship’s technical certificate are in compliance with Resolution 17 ECE/UN and Directive 82/714/EEC
The Act on Inland Navigation and Ports is under preparation. With the adoption of the new Act the majority of directives will be transposed into national legislation. Full alignment can be expected with adoption of Ordinances.
Specific objectives
The objective of this priority is to improve and rehabilitate the Croatian inland waterway system, making it more attractive and competitive in comparison with other modes of transport. Rationale:
The establishment, maintenance and improvement of conditions for safe and reliable inland navigation is a continuous mission of the government. This aspect should be analysed separately according to the type of cargo and the expected growth in the transportation of dangerous cargo. The resulting increase in risk and possible impact of potential incidents on the water require that the existing safety standards be raised. In order to achieve this in Croatia, besides the implementation of river information services and the availability of just-in-time information regarding the movement of vessels, it is important to establish clear procedures regarding the actions which should be taken in the case of incidents, as well as to upgrade the existing systems of marking and monitoring the navigability of inland waterways.
64 To integrate inland navigation into an inter-modal transport network, it is necessary to upgrade the reliability of inland waterways in order to ensure that the waterways meet minimal navigational requirements. The initiation of development cycles in Croatian river ports, processes of technological reconstruction of port buildings and structures, and the connecting of the ports with main road-rail corridors will help in the creation of the preconditions for the inter- modality of river transport. The system of river information services, the core of information and electronic data exchange regarding inland waterway transport, also plays a big role in this process. The Croatian inland water port system includes four international ports (Sisak, Slavonski Brod, Osijek and Vukovar) and several existing and future quays (Belišće, Aljmaš, Batina, Ilok). The present situation is characterised by an unbalanced market demand for the transport of cargo on the Sava and Danube rivers, generally as a consequence of different navigational conditions, technical and technological obsolescence and under-capacity.
At present, river transport accounts for less than 1% of freight transport in Croatia, and is not currently a viable and competitive alternative to road and rail transport for moving bulk commodities.
Description
The total length of the existing waterway network in the Republic of Croatia amounts to 804.1 km, of which 539.2 km are international waterways. A total of 286.9 km meets the requirements of international navigational classification, i.e. requirements for class IV. The development concept for the infrastructure of inland waterways is targeted at increasing the safety and efficiency of inland navigation. Waterway regulation is aimed at the users, which means ensuring smooth and safe navigation for ships with a maximum draught in accordance with the class of the waterway. In practice this means ensuring a minimum depth of 2.5 m for 300 days per year (international waterway class). Future tasks in this sub-sector are: • To maintain the international waterways in accordance with the criteria required under the international navigational class, • To upgrade the class of international waterways which are currently at a lower class than that that required, • To implement a river information service system, • To enhance the quality of the waterway marking system, • To apply ecological standards during the regulation and maintenance of waterways, • To start the project to construct the Danube-Sava canal.
Croatian river ports need qualitative and technological modernisation in order to satisfy the existing and expected transport demand. Along with the modernisation of basic port infrastructure, the system of safety and surveillance in the port areas should also be enhanced. Ports need to connect with main road and rail corridors in order to achieve better integration with the economic hinterland and to create preconditions for the development of inter-modal transport.
The development concept of river ports is based on following principles:
• The public nature of ports, access to port facilities for all users under the same conditions, • Quality of service, technological modernisation and specialisation, • Enhancement of traffic connections with the hinterland, • Integration of the ports into logistic chains, • Implementation of a system for surveillance and control of traffic and port activities in port areas.
In order to solve the problems identified in the port system on inland waters it is necessary to execute the following: • To coordinate the needs for financial investments in port infrastructure and the financial abilities of the state, and, in accordance with this, to invest in priority projects and projects which demonstrate positive economic results through cost-benefit analysis, • To ensure flexibility in defining the deadlines for concession assignment in cases where interest in investing in port buildings and equipment is shown by private investors,
65 • To settle property ownership issues in the port area, including land redemption, the settling of outstanding debts by the Government, long-term rental contracts and the inclusion of the related clauses within concession contracts, • To integrate ports into the river information services system
Targeting
This priority axis will apply to the inland waterway section of the TOP, contributing to the TOP’s objective to prepare projects aimed at the improvement and development of an inland waterway system in Croatia. The priority axis is targeted at: • Improvement of fairway conditions; Establishment of an international navigational regime • Development of trans-shipment points and harbour facilities • Assisting Croatia in meeting its obligations to implement the EU transport acquis in the inland waterway sector Measures:
One measure is proposed under this priority axis: • Measure 2.1. Modernisation and rehabilitation of river waterways and port infrastructure
Delivery
The operations (projects) that will be financed under Priority axis 2 will be selected from the Indicative project list provided in Chapter 3.5 of the Operational Programme (and respective project identification cards attached as Annex 2) in accordance with the general and measure-specific selection criteria provided in this Operational Programme. The selected operations will then be submitted to the European Commission for approval. If a project is appraised as acceptable European Commission will issue a decision on approval for each project which will define the physical object and the eligible expenditure to which the co-financing rate for the priority axis applies. Finally, for each approved project a Financing Agreement between the European Commission and the beneficiary country will be signed laying down those elements. Complementary funding for these investments will be ensured through national funding, external loans and other sources and models of funding.
In the case of projects that do not fall under the title “major projects” (i.e. that are under the 10 m€ threshold) the decision on competing projects will be made by the Selection Committee, based on the selection criteria described in the Operational Programme and confirmed by the Sectoral Monitoring Committee.
Targets and Indicators
Table 5 – Indicators for the Priority Axis 2
unit unit Type source Baseline (by 2012) Definition Definition reviewing Data dates Data dates Final target Data source Frequency of of Frequency Measurement Measurement
Km of the Sava river Agency for waterway with Inland 1 Result km 286,9 2006 annually 531,9 increased navigation Waterways classification Annual Report Increased capacity Port Authorities 2 Result Tonnes 3.500.000 2006 annually 5.500.000 of ports Annual Report Increased freight Tonnes, Port Authorities 3 Result 1.600.000 2006 annually 4.000.000 volume Tonne/km Annual Report
66 Financial allocation and co-financing rate
Out of the total allocation for the Transport OP, which amounts in total to € 53,500,500, the allocation for Priority Axis 2 is € 3,750,000 in 2007 and € 1,875,000 in 2008 (in total € 5,625,000)
For the inland waterway sector it is proposed to set the national co-financing rate at 25% with a 75% rate of IPA co- financing.
3.1.4.1. Measures under Priority axis 2 - Upgrading Croatia’s inland waterway system
Measure 2.1. – Modernisation and rehabilitation of river waterways and port infrastructure
Specific Objectives
The specific objectives of this measure are: • To rehabilitate the Croatia’s part of Corridor VII in order to achieve the requirements of the international classification, category IV; • To modernise and increase the capacity of the ports along the Corridor VII so that they can respond to growing transport demands
Eligible actions
Assistance under this measure refers to procurement contracts (including supervision services, implementation support, tender evaluation, consultancy, project preparation for already identified projects, tender evaluation, project monitoring and evaluation). The actions within this measure could also relate to the inspection, operation and monitoring of inland waterway transport facilities.
The projects proposed will be based on the on the Indicative list of major projects (chapter 3.5.).
Final beneficiary
The final beneficiaries for the measure 2.1 will be the Port Authorities and the Inland Waterways Agency.
Selection criteria
For this measure the main selection criteria are as follows: • The projects will be selected on the basis of the demonstration of an urgent need for higher port capacity, or where it has been demonstrated that the port capacities in use have reached their maximum level and need to be extended; • The projects will be selected on the basis of the evidence that the port capacities are greater than the capacity of the river waterway itself, and that there is, therefore, a need to upgrade the river waterway to an adequate international classification category.
67 Monitoring indicators
Table 6 - Monitoring indicators for the Measure 2.1
unit unit Type source Baseline (by 2012) Definition Definition reviewing Data dates Data dates Final target Data source Frequency of of Frequency Measurement Measurement
Projects ready for Project 1 implementation with full Output Number 0 2007 annually 2 monitoring set of documentation reports Project applications Project 2 completed and submitted Output Number 0 2007 annually 2 monitoring for EU funding reports
3.2. PRIORITY AXIS 3 – TECHNICAL ASSISTANCE
Aim:
The aim of the TA priority axis is to ensure that Croatia is able to administer the Operational Programme, through all aspects of programme management.
Objective
To ensure efficient and effective OP management, and develop institutional capacity for project preparation, management and absorption of IPA and future Structural Funds;
Rationale
Croatian programme and project management capacity – from design through commissioning to operation – is evolving at the national, regional and local levels, supported in recent years by a number of technical assistance and twinning projects under PHARE, CARDS and bilateral assistance. This practical expertise will continue to grow and become embedded in future years, as more projects come on-stream.
Management of IPA, and specifically, this OP, will involve extraordinary costs that do not form part of the Croatian administration’s traditional operating expenses. This includes: information & publicity on IPA; the development of monitoring indicators and an EU funds Management Information System; training for Croatian national bodies in the preparation of project applications for EU assistance funds; the commissioning of external, independent experts for interim and ongoing evaluations; and the costs of managing and implementing the IPA programmes.
Moreover, IPA is designed as a pre-cursor to Structural and Cohesion Funds, and it is essential that Croatia develops the capacity to implement these funds. IPA is an opportunity to learn how to manage funds according to EU rules, and to build sustainable institutional structures, systems and skills for the transition to Structural Funds.
Description
The types of actions under this priority axis will fall under two main themes: i. Specific, tailored support for the coordination and management of the OP, including programming, information and publicity, training in the preparation of EU project funding applications, project identification, appraisal and selection, implementation, financial management, control, monitoring, evaluation, reporting audit; as well as revisions of existing Operational Programmes;
ii. Aid to enhance the specification, collection and use of statistics, which will be necessary for effective monitoring and evaluation under IPA and, subsequently, the Structural Funds;
68
Measures
One measure is proposed under this priority axis: • Measure 3.1. OP management and capacity building
Targets and indicators
Table 7 – Indicators for the Priority Axis 3: Technical Assistance
unit unit Type source Baseline (by 2012) Definition Definition reviewing Data dates Data dates Final target Data source Frequency of of Frequency Measurement Measurement
Staff in the national bodies capable of independently 1 Result Number 0 2007 annually 6 MSSTD identifying, preparing and assessing project applications OP funds absorbed under 2 Result % 0 2007 annually 100 MSTTD operational Priority Axes
Financial allocation and co-financing rate
Out of the total allocation for the Transport OP, which amounts in total to € 53,500,500, the allocation for Technical Assistance is € 255,000 in 2007, € 255,000 in 2008 and € 255,000 in 2009 (in total € 765,000).
For technical assistance it is proposed to set the national co-financing rate at 25% with a 75% rate of IPA co- financing.
Measure 3.1. – OP management and capacity building
Specific Objectives
The specific objectives for this measure are to ensure efficient and effective OP management, and to develop the institutional capacity for managing and absorbing IPA and future Structural Funds.
Rationale
One of the principal goals of implementing IPA is to build administrative capacity, and hence it is essential that Croatia is supported to identify, train, develop and retain a body of skilled and motivated staff, working with effective systems and procedures for sound programme management. This will ensure both the successful management of IPA and a smooth transition to the still greater challenge of Structural Funds programming and the management of a portfolio of a potentially large number of projects.
Description
Through this measure the support to the Operating Structure i.e. bodies dealing with the implementation of priority axis 1 and priority axis 2 will be provided. That support will be specific and tailored support to for coordination and management of the TOP, including programming, information and publicity, training in the preparation of EU project funding applications, project identification, appraisal and selection, implementation support, financial management, control, monitoring, evaluation, reporting, audit, revisions of existing Operational Programmes and the preparation of Operational Programmes and identification of projects for the next funding period. Given the needs to address staff turnover within the public administration allied to the demands of EU funds management which are typically higher
69 than comparable civil service positions, co-financing of the salary costs of public officials within the management structure and project selection committees will be provided under this measure.
Eligible actions
It is intended to finance, support, train and consolidate the systems, processes and skills for EU funds management by the Croatian public administration (as the future managing, certifying, auditing and implementing agencies for Structural Funds) for this OP.
Assistance under this measure refers to procurement contracts; it is intended that technical assistance will cover consultancy and delivery of support (including advice, training and other costs) to the Croatian OP administration in general, but specifically to the Operating structure for the IPA III component – Transport, i.e. bodies dealing with the implementation of Priority axis 1 and Priority axis 2. That support will relate to training activities for the: a. Independent identification, preparation and assessment of projects and Operational Programmes (including revising the existing Operational Programmes) in the relevant sectors for future funding periods, as well as preparation of the respective project applications by teams of individuals in the national bodies (Operating Structure) in order to build up a base of national expertise in this field; b. Conducting pre-feasibility and feasibility studies, environmental impact assessments, cost benefit analyses, financial and economic analyses, preliminary designs, affordability studies, sector consolidation studies; c. Implementation and controls, including procurement & contract management (including support to the Operating Structure, use of supervising engineers, etc); d. Monitoring, including the development of the monitoring arrangements, the organisation and administration of Monitoring Committees and the development of the Management Information System; e. Evaluation, particularly external evaluators engaged for interim and ongoing evaluations; f. The preparation and implementation of information and publicity activities; g. Co-financing of staff salary costs.
Assistance can additionally include provision for translation & interpretation services, as well as logistical expenses and supply of equipment or other items relating to the work of Monitoring Committees.
Selection criteria
Assistance will be granted to those activities that will have the highest learning effect especially in relation to gaining knowledge and experience in project preparation / assessment.
Final beneficiaries
The primary beneficiaries of this measure are bodies within the Operating structure - the Ministry of Sea, Tourism, Transport and Development, Croatian Railways Infrastructure, Central Finance and Contracting Agency, Inland Waterways Agency, and members of the Monitoring Committees and Selection Committees.
Monitoring Indicators
70
Table 8 – Monitoring indicators for the Measure 3.1
unit unit Type source Baseline (by 2012) Definition Definition reviewing Data dates Data dates Final target Data source Frequency of of Frequency Measurement Measurement
Training provided for the 1 Output Number 0 2007 annually 10 CODEF staff of public bodies Publicity ‘events’ organised (press 2 Output Number 0 2007 annually 10 CODEF conferences, seminars, TV / radio broadcasts) Meetings of Monitoring 3 Output Number 0 2007 annually 10 CODEF Committees Transport project applications assessed and 4 Output Number 0 2007 annually 4 CODEF submitted by the Operating structure
3.3. HORIZONTAL ISSUES
3.3.1. Equal opportunities for men and women
In September 2006, the Croatian Government adopted the National Policy for the Promotion of Gender Equality, 2006-2010. The objectives of the policy, which are of particular relevance to Components III & IV of IPA, include the reduction of female unemployment and elimination of discrimination, promotion of female entrepreneurship and improved enforcement of relevant labour laws. It also strengthens and promotes measures that support the reconciliation of professional and family obligations.
The Government has also adopted a strategic document on the main tasks of state administrative bodies in the process of accession to EU 2004-2007, one of which is to strengthen cooperation between national and local state mechanisms in relation to gender mainstreaming, and continuous cooperation with non-governmental organisations active in the field of gender equality.
The involvement of society and communities in infrastructure construction, operation and maintenance will be sought, in an effort to contribute to the reduction of unemployment and poverty alleviation. Job opportunities can be enhanced in a sustainable way, through the employment of the Croatian labour force (male and female) especially in the post-construction phase for operations and infrastructure maintenance.
3.3.2. Sustainable transport
The railways and waterways are the most The key to a sustainable transport policy is to appropriate transport mode for carrying bulk loads • commercialise business activities; over longer distances (economies of scale). It is • ensure transport safety and protection of the environment; acknowledged however, that under free market • achieve balanced area coverage with conditions and conditions of free modal choice on transport services; the European transport market, the railways and • introduce resource-use based transport waterways must operate commercially and respond pricing; to customer needs in order to withstand competition • adopt the user-pay principle, and • promote the use of the most energy efficient from alternative modes and generate sufficient transport. revenue for providing sustainable transport.
3.3.3. Transport safety and environment
71
Only safe and environmentally-friendly transport is sustainable transport. In fact, the White Paper68 places the transport user at the heart of transport policy, that is, to reduce accidents and develop cleaner technologies.
Adopting a pro-active policy in this regard, the OP concentrates on improvements in the energy-efficient bulk carriers - rail and river - promoting at the same time multi-modal transport solutions whereby rail and river transport cover the long-haul portion of transport movement.
In counteracting the existing development difficulties of Croatian transport, in particular, the unequal growth between modes of transport, the OP emphasises the revitalisation of the railways, to be achieved before economic development, combined with the envisaged accession to the EU, which might exacerbate the railway’s weak market position. The OP therefore follows a strategy of sectoral sustainability as adopted by the European Council in Gothenburg in June 2001. The influence of transport and transport facilities on the natural environment has been monitored in Croatia since 1980. This monitoring concerns the biosphere (flora and fauna), hydrosphere (soil, water, sea) and atmosphere (air). Basic objectives have been set to create a reasonable and balanced transport system, capable of mitigating negative effects, such as: • pollution of air, ground water and soil, • the irrational consumption of energy, • a reduction in the quality of life, particularly in cities • damage to environment and nature • the inadequate use of land • visual degradation of the landscape All these hazards have lead to the introduction of harsh criteria for the registration of passenger cars and trucks.
The Transport OP focuses on railways and inland waterways, justified as a means of removing goods transportation from the road network, particularly long-distance traffic. The pursuit of sustainable transport is described as ensuring protection of the environment, introducing resource-use based pricing, adopting the user-pays principle and promoting the use of the most energy-efficient transport. Railways are presented as an energy-saving, clean and safe mode of transport.69
The Republic of Croatia has been performing environmental impact assessment for individual developments since 1984, when the procedure was defined by the Act on Physical Planning and Spatial Development. Since 1994, when the Environmental Protection Act was adopted (OG 94/1994, 128/1999), the environmental impact assessment procedure has been governed by this Act and its implementing regulation. The effective implementing regulation is the Ordinance on Environmental Impact Assessment (OG 59/00, 136/2004, 85/2006). The Act and Ordinance partly include requirements from Council Directive 85/337/EEC of 27 June 1985 as amended by 97/11/EEC and 2003/35/EC on the assessment of the effects of certain public and private projects on the environment, relating to: the establishment of responsible bodies, EIA in a trans-boundary context, a description of the EIA procedure, and an assessment of direct and indirect effects.
The transposition of the remaining provisions of the Directive into Croatian legislation will be ensured by adoption of the new Environmental Protection Act in 2007, and the implementation regulation on environmental impact assessment. CARDS 2003 project "EIA Guidelines and Training” assisted in the transposition of Council Directive 85/337/EEC.
By adopting the new Environmental Protection Act and its subordinate special regulations:
• the provisions of Directive 2001/42/EC of the European Parliament and Council of 27 June 2001 on the assessment of the effects of certain plans and programmes on the environment will be transposed,
68 White Paper, European Transport Policy for 2010: time to decide, Brussels, 12.9.2001, COM(2001) 370 final 69 The Ex-ante evaluation of IPA Operational Programmes for Croatia, Transport Operational Programme, April 2007
72
• the provisions of Council Directive 96/61/EC of 24 September 1996 on Integrated Pollution Prevention and Control (IPPC) will be transposed.
Moreover, a transposition of Directive 2004/35/EC of the European Parliament and Council of 21 April 2004 on environmental liability with regard to the prevention and remedying of environmental damage is envisaged. Recognised principles of environmental protection, including the ‘polluter pays’ principle, are already in force in Croatia.
3.3.4. Equal provision of transport services
Transport infrastructure is essential for economic and social development and inter-regional exchange. It is an instrument of regional development, facilitating the flow of goods as well as the access of people to employment, health, education and recreation. Previous experience within the framework of EU enlargement clearly shows that improved rural/regional access and the linking of peripheral regions to the arterial network is essential for economic and social cohesion and the alleviation of regional disparities. Such links also include cross-border transport with neighbouring countries.
Hence, the sectoral approach taken in the OP shall ensure that programming corresponds to economic demands and social needs, as well as network integration and interoperability requirements.
3.3.5. Balanced modal split between modes of transport.
Infrastructure being costly, it will be important for achieving sectoral sustainability to adopt infrastructure standards which are affordable, and which help to promote a balanced modal split which reflects the inherent cost and operational advantages of the various transport modes available in Croatia. This assumes that cost-distortions will be gradually reduced across modes and instead cost-based pricing of the various forms of transport will be introduced, taking into consideration infrastructure costs, as well as eventual external costs accruing to the society as a whole, and to adopt the user-pay principle wherever feasible.
The "polluter pays principle" is already in operation in Croatia. Indeed, since 2001, each motor vehicle has to pass an annual eco-test - in accordance with EU technological standards (Council Directive 96/96 EC of December 2, 1996), in order to monitor and determine its pollution level. An eco-fee is paid every year for every registered vehicle, in accordance with the vehicle age. The proceeds of this tax are allocated to the Fund for Energy Efficiency and Environment Protection. The “user pay principle” has been applied since 1972, with the introduction of the toll- motorway system in Croatia.
Securing revenue from user charges implies that government interference in pricing is removed in order to eliminate price-distortions and, hence, competitive distortions. Following this principle, river port fees for the use of wharfs have been aligned with the European practice and all ships, regardless of nationality, are liable to pay the same fee, information on which is made publicly available70.
3.3.6. Energy-efficient transport
Croatia’s own production of energy meets only about half of its energy requirements and its supply of primary energy is in constant decline. Moreover, Croatia spends significantly more energy per unit of GDP than the EU average. Consequently, due attention is to be paid to the promotion of energy efficiency in transport by focusing on rail and waterway transport improvements.
70 MSTTD
73 3.3.6.1. Commercialisation
In addition to the parent company, there are, altogether, 17 dependent subsidiary companies of the Croatian Railways Group, which are 100% or majority owned, with a total employment of 21 000 employees.71 Moving towards commercialisation requires HŽ to find ways to dispose of non-core activities. This will enable resources to be concentrated on core railway services and is a means of devolving more services to the private sector. An additional means of achieving sustainability is to introduce contract management for rail services, such as ticketing, ballast supply or rolling stock maintenance. Furthermore, long term sustainability means finding solutions for problems associated with non-profitable local railway lines.
Measures to modernise and restructure the national railways along these lines began in 1998, and will be further developed under the World Bank Programmatic Adjustment Loan 2005-2007, which deals with Croatian Railways Group restructuring.
Ports again provide an important interface, particularly between river and road transport. Contracting out to the private sector constitutes an important step towards sustainability, also in the waterway and river ports sector. International experience and practice shows that adopting commercial management and close dialogue with port users can reduce cargo handling costs and transhipment time at ports, as the most crucial nodal points for the development of inter- modal transport. Substantial progress has been made in this regard in Croatia. Administrative port functions are now with the State Port Authorities and clearly separated from port commercial operations. Administering the ports, developing basic infrastructure and providing adequate port access is the responsibility of the Port Authorities, public bodies under the supervision of the MSTTD, while commercial activities are run by private port operators under long term concession contracts.
3.3.7. Participation of civil society and geographical, sectoral and thematic concentration
Participation of the representatives of civil society, along with other relevant institutions, in the preparation of the Operational Programme is described in Chapter 1.3 Partnership consultations. A detailed description of the concentration principle applied to this OP is given in the Chapter 1.2.3.
3.4. COMPLEMENTARY AND SYNERGIES WITH OTHER FORMS OF ASSISTANCE
The TOP will contribute to the achievement of Croatia’s global IPA objectives by improving conditions for growth and employment through the improvement of the transport sector as well as of administrative capacity. In this regard, the TOP’s synergies with other OPs within the SCF framework contribute to increasing and improving the quality of human capital, the development of innovation and knowledge society, the adaptability to economic and social changes are considered.
The TOP contributes to strengthening economic integration by developing transport infrastructure and enhancing access to services of general interest, by improving governance for a better quality of public policy, and by raising the standard within Croatia’s skills-base in the transport sector.
3.4.1. Complementarities and synergies with other SCF OP
All four Operational Programmes under IPA Component III and IV (Regional Competitiveness, Transport, Environment and Human Resource Development) are mutually dependent, since the performance of all sectors together is a key prerequisite for achieving sustainable development. In this sense, they are integrated in their contribution to Croatia’s economic, environmental and social future.
The complementarity and synergy between the four OPs is most evident in the light of the Strategic Coherence Framework for 2007 – 2013, since its main task is to assure the consistency between priorities / activities under IPA Components III and IV. In relation to the SCF, the TOP is consistent with the other three OPs as follows:
71 Croatian Railways Group
74 Regional competitiveness An adequately developed transport infrastructure is a precondition for economic development, attraction of investment and improvement of the quality of life, i.e. for enhancing business related and basic municipal and social infrastructure. The development of basic infrastructure is a prerequisite for growth of productive investments and entrepreneurial activities. Additionally, the investment conducted in the course of the TOP will create opportunities for SME development, as well as improve the investment climate and raise interest among domestic and foreign investors
Environment The development of transport links and modes is, on the one hand, a necessary prerequisite for economic development, but on the other hand, the transport sector has a major influence on the environment (for example, the share of traffic in air pollution increased by an average of 20% in the period from 1990 to 1998). An adequately developed transport infrastructure is a precondition for sustainable development of regional waste centres. In this sense, the development of sustainable transport is closely linked to environmental protection and preservation; therefore emphasis is laid on the development of the railway and inland waterway transport systems. This is also in line with the strategy to promote multi-modal transport and generate traffic diversion effects, from the higher-polluting road traffic to energy efficient rail/river transport modes.
Human resources Investment in transport infrastructure should stimulate short-term employment within the construction sector, but it will also underpin economic activity within the beneficiary regions. In both cases, it is important that employment demand is matched by skill supply. Strengthening the institutional capacity and efficiency of public administrations and public services at national, regional and local levels in regard to transport sector related policy and investments is another prerequisite for implementation of the TOP priorities and development in general (bearing in mind that institutional capacity related activities will be conducted through IPA Component I – as set out in the IPA Regulation).
All four OPs also have certain common goals of a more general nature – to help the relevant institutions to achieve readiness for EU membership and develop institutional capacity for, and practical experience with, the management of Structural Funds-type interventions, i.e. to take part in the EU’s Cohesion policy.
3.4.2. Complementarity and synergies with other IPA components
Complementarity with other OPs is highlighted, particularly for regional development and human resources, with an emphasis on achieving competitiveness and sustainability through environment-friendly transport.72
Besides the inter-linkages between the Operational Programmes covered by the SCF, a clear and strong complementarity can be established in relation to the other three components:
IPA Component I – Transition Assistance and Institutional Building Strengthening the institutional capacity and efficiency of public administrations and public services at national, regional and local level in regard to transport sector related policy and investments is another prerequisite for implementation of the TOP priorities and development in general. Therefore a strong link between institutional building assistance under Component I – whose main task is to provide capacity building support for alignment and implementation of the transport acquis to the relevant competent authorities at regional and national level and Component III will be established and secured
IPA Component II – Regional and Cross-Border Assistance Due to the nature of transport projects significant regional effects can be achieved through transport policy, particularly in the case of railway sub-sector related projects, both in terms of large projects (which can have a strong and transboundary effect) and small projects (which can cover the border areas between regions). In that sense coordination between Component III (Transport) and Component II (cross border cooperation) will be assured (see section 5).
72 The Ex-ante evaluation of IPA Operational Programmes for Croatia, Transport Operational Programme, April 2007
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IPA Component V – Rural Development Development of transport infrastructure is a precondition for economic development, attraction of investment and improvement of the quality of life, i.e. for enhancing the development of rural infrastructure. The development of basic infrastructure is a prerequisite for growth of productive investments and rural activities. Additionally, investment conducted in the course of the TOP will create opportunities to increase development in rural areas and in areas with low population densities, as well as to improve the investment climate and raise interest among domestic and foreign investors Coordination arrangements A number of institutional arrangements are being proposed to promote complementarities and coherence between the various Components of IPA and the Environment OP. The National IPA Coordinator ensures partnership between the Commission and the beneficiary country, and a close link between the general accession process and the use of assistance and bears overall responsibility for the coherence and co-ordination of the programmes. CODEF, headed by the National IPA Coordinator, takes overall responsibility for coordinating programming and monitoring activities under the IPA programme in Croatia. CODEF’s Department for EU Programmes in the Field of Capacity Building for EU Accession is responsible for co-ordinating IPA Components I, II and V. The Department for EU Programmes in the Field of Economic and Social Cohesion takes responsibility for the co-ordination of IPA Components III and IV. The Strategic Co-ordinator, under the responsibility of the national IPA co-ordinator, is responsible for co-ordinating assistance granted under the regional development component and the human resources development component; Regarding methods of co-ordination, the IPA Monitoring Committee will assume the function of overall co-ordination of assistance granted under the IPA programme. Coordination will be ensured on the one hand through discussion on the implementation / progress / performance of each IPA component and, on the other hand, through the participation of representatives of bodies heading each of the IPA components (Operating Structures), and the NIPAC, NAO, EC, in the Monitoring Committee. Environment Sectoral Monitoring Committees will be established and will report to the IPA Monitoring Committee. It will also serve as the main co-ordination tool since it will, among other members, include representatives of EC, NIPAC, NAO and the Strategic Co-ordinator for Components III and IV. Additionally, under the direct responsibility of the NIPAC / Strategic Co-ordinator, regular coordination meetings for IPA components III and IV will be held. With regard to project level coordination, the standard rule applies preventing financing a project from more than one EU source. By avoiding overlaps and enhancing synergy across measures, it was sought to enhance the impact of limited IPA financing available to Croatia. Co-ordination of this Operational Programme with other OPs will, therefore, not only ensure that unnecessary overlapping is avoided, but also promote possible complementarities and synergies.
The co-ordination of activities carried out by IFIs and other donors is ensured all along the programme cycle. In the programming phase, both CODEF and the Ministry of Finance coordinate the preparation of strategies and projects financed by the EU and IFIs in order to avoid duplication and achieve maximum synergies. In the implementation phase, representatives of the Ministry of Finance will be included in the IPA Monitoring Committees for projects which are financed by IFIs, while CODEF representatives will participate in progress monitoring meetings organised by the Ministry of Finance for projects financed through foreign loans and credits, as well as in audit missions undertaken by IFIs. In the case of any audit or evaluation missions organised by the European Commission for a specific project, representatives of the Ministry will be at the disposal of the auditors/evaluators as necessary.
In addition, the State Secretary holds the function of the Deputy Chief Negotiator for EU Accession while the Deputy State Secretary is Sectoral Coordinator for Components III and IV, as well as a member of the working group for negotiations on Chapter 22 Regional Policy and Coordination of Structural Instruments. This direct link with the accession negotiations process enables CODEF to ensure a close coordination between EC funding and the accession process priorities across all five of IPA components.
3.4.3. Complementarity with other EU assistance
76 Overall, EU assistance to Croatia has evolved from post-war re-construction and humanitarian aid (in the late 1990s) through stabilisation and association support (CARDS programme 2001-2004) to the use of three pre-accession programmes (Phare, ISPA and SAPARD for 2005 & 2006).
Under the national component of the CARDS programme in Croatia in the period 2001-2004, transport was not acknowledged as one of the priority sectors; however, the Regional Balkans Infrastructure Study – Transport (REBIS) was conducted under the regional component of the programme. The REBIS study is significant since it focuses on the development of a multi-modal “South East Europe Core Regional Transport Network” and as such sets the foundation for further network developments.
With the opening of pre-accession programmes in 2005, support was made available for both institution-building and infrastructure investment in the transport sector. The Phare programme focuses on the harmonisation of the Croatian legislation with the EU acquis in the maritime and railway policy sector, as well as on building capacity in relevant state administration bodies for the implementation of the acquis.
Phare
The following paragraphs describe the key Phare projects, which are preparing the legislative framework: Phare 2005 : Maritime Safety: Enforcement of Administration Capacity – Monitoring and Management of Vessels This project represents an initiative for the enhancement of administrative and technical efficiency of maritime administration. It has to deal with management of vessels, with a special regard to vessels carrying dangerous and polluting goods. Accordingly, it makes a clear contribution to the implementation of the acquis communautaire in Croatia, thus helping to meet the political and the economic membership criteria of the Republic of Croatia as a candidate for the EU membership.
Phare 2006: Maritime Safety: Enforcement of Administration Capacity – Monitoring and Management of Vessels – phase 2 The project, aims to give a full and complete effect to the requirements of the Directive 2002/59/EC of the European Parliament and of the Council establishing a Community vessel traffic monitoring and information system and repealing Council Directive 93/75/EE. It is divided into two major parts: a part dealing with technical matters of the Vessel Traffic Monitoring and Information System (VTMIS) and a part dealing with institutional capacity building of the Croatian maritime administration relating to vessel traffic monitoring as well as flag state implementation.
Phare 2006: Restructuring and Development of Croatian Railway system in the Framework of EU Legislation The project will provide technical assistance, support and training to the Ministry of Sea, Tourism, Transport and Development and stipulated bodies and institutions in the area of rail restructuring and regulation.
ISPA
The ISPA programme co-finances a large scale infrastructure project on Railway Corridor X, which focuses on the rehabilitation of the railway line in Eastern Slavonia from Vinkovci to Tovarnik at the border with Serbia, at a length of 34.5 km, thus paving the way for future transport sector investments under the 2007-2009 TOP (IPA programme).
The ISPA works project comprises a total investment of Euro 75.761 million with a 38% ISPA contribution.
Further, under ISPA “IPA Project Pipeline Preparation – Transport”, TA assistance funds are available for feasibility screening the entire remaining length of the Corridor X railway in Croatia.
77 3.4.4. Other related donor interventions
3.4.4.1. Railways
EBRD and IBRD loans have been extended for the revival of the national railway company within the framework of the 1998-2002 Railway Modernisation and Restructuring Project, as follows:
• IBRD loan 4433 for the reconstruction and modernisation of railway infrastructure and providing for redundant employees (EUR 85.4 million);
• EBRD loan 730 for the modernisation of railway locomotives (USD 35 million).
As a follow up, the 2000 - 2005 Croatian Railways' Modernisation and Restructuring Strategy has been adopted by the Croatian Parliament, with the view to continuing implementation and achievement of the objectives of the restructuring project. Current activities in this regard are:
• Separation of transport operations from infrastructure management, separation of core and non-core businesses, establishment of new companies from non-core activities and their preparation for privatisation, reduction of the number of employees, reduction of passenger services which are not financially viable, promotion of the real estate business, measures for financial consolidation with the view to lessening the financial burden on the State Budget;
• Restructuring of HŽ (Croatian Railways) within the framework of the conditions for a Programmatic Adjustment Loan (PAL), World Bank, 2005-2007.
3.4.4.2. Inland Waterways
Up to this point, foreign donors have not had any input into the inland waterway sector
3.4.5 Supplementary MSTTD Activities
The following activities are either currently funded or will be funded from the Ministry’s own funds.
Ongoing
River transport: • A five-year plan for the development of waterways and a five-year plan for the development of inland ports, • Action plan for river transport (implementation of the NAIADES)
Railways: • Preparation of the National Railway Infrastructure Programme.
Planned for the period of the OP
Railways: • Preliminary design for the section Zaprešić -Savski Marof (on railway corridor X), • Preparation of a feasibility study and preliminary technical design for the priority project on the indicative project list (Zagreb main station signalling and interlocking system)
River transport: • Elaboration of the action plan for river transport (implementation of the NAIADES); • Project documentation for, and construction study of, the facility for the removal of liquid waste from vessels in Croatian river ports;
78 3.5. INDICATIVE LIST OF MAJOR PROJECTS (2007 -2009)
Concerning Priority Axis 1, all the railways improvement projects are situated along Pan-European Corridor X and constitute the natural continuation of the action targeted under ISPA, the railway rehabilitation and upgrading project on the track section from Vinkovci to Tovarnik state border.
As regards Priority Axis 2 “Upgrading Croatia’s inland waterway system”, the foreseen project proposals are situated along Pan-European Corridor VII. There is an urgent rehabilitation need for the whole Croatian part of the corridor. However, none of the projects are presently sufficiently mature for the works to start within the framework of the TOP 2007-2009 period. For the presented project proposals, the necessary project documentation will be prepared through this TOP jointly with the ongoing-feasibility study on “Sava River Navigability” conducted by the Sava River Commission. This should result in viable project proposals which then can be addressed in the 2010-2012 programming period.
Picture 7 - Location of priority railway projects
79 INDICATIVE LIST OF MAJOR RAILWAY PROJECTS:
Project name Type TA support Estimated Measure Comments Status Total M€ 1 Project 1: Zagreb Main Construction National 17,90 Measure Being Station Signalling and funds 1.2 The project aims at adjusting railway station technical parameters prepared Interlocking System to Trans-European network requirements. The basic benefit to be for funding gained by this investment is the removal of a traffic bottleneck and in budget consequent speed restrictions on the line due to the antiquated years 2007 signalling equipment. This project has been identified in the REBIS and 2008 study. The project includes all necessary reconstruction and adjustments of the device.
2 Project 2: Line Rehabilitation Construction National 38,50 Measure The last track overhaul on the Okučani - Novska railway line was Being Okučani to Novska section funds 1.1 carried out thirty years ago. On one portion of the section, the prepared speed has been reduced to 60 km/h. After the proposed renewal, for funding the speed will be increased to 160 km/h, and the axle load to 225 in budget kN. The work includes all renovations that are needed to make the years 2008 section compliant with the criteria set for corridor railways (AGC and 2009 requirements). Project name Type TA support Estimated Measure Comments Status Total M€ 3 Project 3: Line Rehabilitation Construction ISPA TA 135,00 Measure Prepared Novska to Dugo Selo Section 1.1 This project can be divided in three Phases. Due to the track for funding condition operation speed along this section is reduced to 70 km in budget and occasionally below. Maintenance was last performed in the years 2007 period 1979-1980. The project should help to bring the section from and 2008 the original design standard 130 km/h to 160 km/h. The interoperability criterion will be fulfilled by installation of the Level 1 ETCS device. 3 phases: I. Novoselec – Dugo Selo 27.1 km II. Kutina – Novoselec 27.7 km III. Novska – Kutina 26.5 km Main activities include track overhaul of the 81.3 km single track line including reconstruction of stations, reconstruction of sections of curved track to increase speed to 160 km/h, rehabilitation of substructure, culverts and drainage system, replacement of level crossings with bridges on a higher rank state roads, rehabilitation of other level crossings, replacement of the relay signalling equipment by electronic one and installation of ETCS system, centralised traffic control system covering route from Okučani to Dugo Selo including CTC centre in Zagreb to manage traffic operations from Slovenian border to a point west of Vinkovci, upgrade of telecommunication system including the introduction of new GSM- R system and adjustment of overhead line equipment.
81 Project name Type TA support Estimated Measure Comments Status Total M€ 4 Project 4: Line rehabilitation Construction ISPA TA 25,00 Measure Prepared The project includes track overhaul of the 7.5 km double track line Savski Marof – Zaprešić 1.1 for funding with replacement of the permanent way material and reconstruction Section of station tracks in Zaprešić and Savski Marof. in budget years 2008 Additionally it will include rehabilitation of the substructure, culverts and 2009 and drainage system, replacement of level crossings, replacement of the relay fail-safe signalling equipment by electronic ones which will be remotely controlled from Central Traffic Control centre in Zagreb and fitted with ETCS system, re-positioning of signals to enable the speed of 160 km/h, upgrade of the telecommunication system (including the installation of new GSM-R system) and adjustment to the new Centralised Traffic Control System, adjustment of the overhead line equipment.
The central point of this project is the reconstruction of the railway station Zaprešić that will enable the separation of passenger and freight traffic in the area of Zagreb junction through the future freight by-pass on the western entrance to Zagreb.
The necessary documentation for this project will be prepared through the ISPA Project Pipeline TA.
82 INDICATIVE LIST OF MAJOR INLAND WATERWAY PROJECTS:
Project name Type TA Estimated Measure Comments Status support Total M€ Project 5: Rehabilitation Construction IPA 40 Measure Significant preparatory work already undertaken. Project Prepared for and Improvement of the 2.1 should be developed in close cooperation with the Sava funding in Sava River Waterway River Commission budget years 2007 and 2008 Project 6: Reconstruction Construction IPA 40 Measure Significant preparatory work already undertaken. Project is Prepared for of the Port of Vukovar – 2.1 currently in stand by position because there is no funding in New port East adequate capacity for designing and engineering. budget years 2007 and 2008
83
4. INDICATIVE FINANCIAL TABLES
For Public expenditure information
Community National Public IPA cofinancing Other (IFI, Total Public expenditure YEARS 2007 - 2009 Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Upgrading Croatia’s rail transport system 62.814.000 47.110.500 15.703.500 75% 0 Measure 1.1: Line upgrading and modernisation 44.914.000 33.685.500 11.228.500 75% 0 Measure 1.2. Improvement of the safety and efficiency of railway operations 17.900.000 13.425.000 4.475.000 75% 0
Priority Axis 2: Upgrading Croatia’s inland waterway system 7.500.000 5.625.000 1.875.000 75% 0 Measure 2.1. Modernisation and rehabilitation of river waterways and port infrastructure 7.500.000 5.625.000 1.875.000 75% 0
Priority Axis 3: Technical Assistance 1.020.000 765.000 255.000 75% 0 Measure 3.1 Programme management and capacity building 1.020.000 765.000 255.000 75% 0
Total Years 2007 - 2009 71.334.000 53.500.500 17.833.500 75% 0
For Public expenditure information
Community National Public IPA cofinancing Other (IFI, Total Public expenditure YEAR 2007 Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Upgrading Croatia’s rail transport system 17.327.000 12.995.250 4.331.750 75% 0 Measure 1.1. Line upgrading and modernisation 2.000.000 1.500.000 500.000 75% 0 Measure 1.2. Improvement of the safety and efficiency of railway operations 15.327.000 11.495.250 3.831.750 75% 0
Priority Axis 2: Upgrading Croatia’s inland waterway system 5.000.000 3.750.000 1.250.000 75% 0 Measure 2.1. Modernisation and rehabilitation of river waterways and port infrastructure 5.000.000 3.750.000 1.250.000 75% 0
Priority Axis 3: Technical Assistance 340.000 255.000 85.000 75% 0 Measure 3.1 Programme management and capacity building 340.000 255.000 85.000 75% 0
Total Year 2007 22.667.000 17.000.250 5.666.750 75% 0
85
For Public expenditure information
Community National Public IPA cofinancing Other (IFI, Total Public expenditure YEAR 2008 Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Upgrading Croatia’s rail transport system 21.160.000 15.870.000 5.290.000 75% 0 Measure 1.1: Line upgrading and modernisation 18.587.000 13.940.250 4.646.750 75% 0 Measure 1.2. Improvement of the safety and efficiency of railway operations 2.573.000 1.930.000 643.000 75% 0
Priority Axis 2: Upgrading Croatia’s inland waterway system 2.500.000 1.875.000 625.000 75% 0 Measure 2.1. Modernisation and rehabilitation of river waterways and port infrastructure 2.500.000 1.870.000 625.000 75% 0
Priority Axis 3: Technical Assistance 340.000 255.000 85.000 75% 0 Measure 3.1 Programme management and capacity building 340.000 255.000 85.000 75% 0
Total Year 2008 24.000.000 18.000.000 6.000.000 75% 0
86
For Public expenditure information
Community National Public IPA cofinancing Other (IFI, Total Public expenditure YEAR 2009 Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Upgrading Croatia’s rail transport system 24.327.000 18.245.250 6.081.750 75% 0 Measure 1.1: Line upgrading and modernisation 24.327.000 18.245.250 6.081.750 75% 0 Measure 1.2. Improvement of the safety and efficiency of railway operations 0 0 0 75% 0
Priority Axis 2: Upgrading Croatia’s inland waterway system 0 0 0 75% 0 Measure 2.1. Modernisation and rehabilitation of river waterways and port infrastructure 75% 0
Priority Axis 3: Technical Assistance 340.000 255.000 85.000 75% 0 Measure 3.1 Programme management and capacity building 340.000 255.000 85.000 75% 0
Total Year 2009 24.667.000 18.500.250 6.166.750 75% 0
87 5. IMPLEMENTATION PROVISIONS
5.1 Management and control structures
This chapter of the Operational Programme describes the systems and arrangements in place as they are known at the time of the drafting of the Operational Programme. However, a number of critical decisions regarding structures and responsibilities, as well as management and information systems, will be taken in the context of the accreditation for conferral of decentralised management, which follows a different timing from the adoption of the Operational Programme. To this end, the Framework Agreement, as well as the Financing Agreement to be signed after conferral of decentralised management, will set out detailed provisions regarding management and control systems. The provisions in this chapter must therefore be understood as subject to later adaptations by the applicable provisions of these agreements, where required.
CODEF will oversee the implementation of all five components of the IPA programme. The State Secretary of CODEF is appointed as the National IPA Coordinator. The role of the Strategic Co-ordinator for IPA Components III & IV will be assumed by the Deputy State Secretary of CODEF. The Strategic Coordinator will ensure that there is complementarity and coherence between the programmes implemented in the regional development and human resources development spheres, especially taking into account the limited amount of financial resources available under IPA and the need for the concentration of activities.
5.1.1 Bodies and authorities
Based on the IPA Implementing Regulation, the Croatian Government has adopted its own legal act/s to designate specific bodies for IPA management and implementation73.
Under the provisions of this Regulation, the following positions/bodies have been or will be designated / established: • National IPA Coordinator • Strategic Coordinator for the regional development and the human resources development components • Competent Accrediting Officer • National Authorising Officer • National Fund • Audit Authority • Operating Structure
With the exception of the Operating Structure and the role of the Strategic Coordinator, these bodies essentially perform tasks which are generally applicable to all IPA components in accordance with their functions specified in the relevant articles of the IPA Implementing Regulation.
Accordingly, in line with the provisions of Article 7.3 of the afore-mentioned Regulation and as specified in the 'model' Framework Agreement adopted by the Commission on 6 July 2007 [ref C(2007) 3208 final – E/1368/2007], such functions will be incorporated under the Framework Agreement to be concluded between the Commission and Croatia.
73 Regulation on the scope and contents of responsibilities and the authority of bodies responsible for managing the instrument for pre-accession assistance (OG 18/2007); Amendments to the regulation on the scope and contents of responsibilities and the authority of bodies responsible for managing the instrument for pre-accession assistance (OG 82 /2007) Decision on the appointment of individuals responsible for managing the instrument for pre-accession assistance (IPA) (OG 18/2007); amendment to the decision on the appointment of individuals responsible for managing the instrument for pre-accession assistance (IPA) OG 82 /2007)
88 Operating Structure This Operational Programme will be managed by the Head of the Operating Structure who will be responsible for the following functions in compliance with Article 28.2 of the IPA Implementing Regulation: • Drafting the annual or multi-annual programmes; • Programme monitoring and guiding the work of the Sectoral Monitoring Committee as defined in Article 59, notably by providing the documents necessary for monitoring the quality of implementation of the programmes; • Drawing up the sectoral annual and final implementation reports defined in Article 61(1) and, after their examination by the Sectoral Monitoring Committee, submitting them to the Commission, to the National IPA Co-ordinator and to the National Authorising Officer; • Ensuring that operations are selected for funding and approved in accordance with the criteria and mechanisms applicable to the programmes, and that they comply with the relevant Community and national rules; • Setting up procedures to ensure the retention of all documents required to ensure an adequate audit trail, in accordance with Article 20; • Arranging for tendering procedures, grant award procedures, the ensuing contracting, and making payments to, and recovery from, the final beneficiary; • Ensuring that all bodies involved in the implementation of operations maintain a separate accounting system or a separate accounting codification; • Ensuring that the National Fund and the National Authorising Officer receive all necessary information on the procedures and verifications carried out in relation to expenditure; • Setting up, maintaining and updating the reporting and information system; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; • Ensuring internal audit of its different constituting bodies; • Ensuring irregularity reporting; • Ensuring compliance with the information and publicity requirements. The Operating Structure (OS) will be composed of the following specific bodies in accordance with Article 31 of the IPA Implementing Regulation: The Ministry of Sea, Tourism, Transport and Development (MSTTD), Croatian Railways Infrastructure (CRI) The Central Finance and Contracting Agency for EU Programmes and Projects (CFCA).
89 The position and level of responsibility, as well as the Heads of specific bodies within the Operating Structure, are shown in the following table:
Level of Titles of the bodies within Specific bodies within the Operating Structure Responsibility the Operating Structure Heads of specific bodies within the Operating Structure I. Operational Body Responsible for OP The Ministry of Sea, Tourism, Transport and Development Programme level Nazorova 61, 10000 Zagreb
State Secretary for Development
II. Priority/Measure Body Responsible for All Priority Axes level Priority/Measure The Ministry of Sea, Tourism, Transport and Development Directorate for Strategic Infrastructure Projects Krležin Gvozd 1a, 10000 Zagreb
Assistant Minister
III. Project level Implementing Body Priority Axis 1 Priority Axes 2 & 3 (Contracting Authority) Croatian Railways Infrastructure Central Finance and Contracting Agency for EU Mihanovićeva 12, 10000 Zagreb Programmes and Projects (CFCA) Katančićeva 5, 10000 Zagreb Director Head of CFCA
90 The State Secretary for Development of the Ministry of Sea, Tourism, Transport and Development will act as the Head of Operating Structure in the meaning of Article 167 (3) of the IPA Implementing Regulation. Any personnel changes in the Heads of the specific bodies referred to above will be notified to the Commission, as appropriate, including any changes which affect the accreditation of the Operating Structure and the Commission's subsequent conferral of management powers. Distribution of functions The Ministry of Sea, Tourism, Transport and Development (as a Body Responsible for OP and as a Body Responsible for Priority/Measure) will execute the following functions in relation to the Operational Programme as a whole: • Preparation of the Operational Programme and its adjustments; • Coordination of programme monitoring in accordance with provisions of Article 59 of the IPA Implementing Regulation; • Coordination of the preparation of annual and final sectoral reports in accordance with the provisions of Article 169 of the IPA Implementing Regulation; • Setting up procedures for the retention of all documents to ensure a sufficiently detailed audit trail (Article 20 of the IPA Implementing Regulation); • Organisation of interim evaluations during the period of programme implementation, in cooperation with CODEF; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; • Identification of the intended final beneficiaries, the expected selection modalities and possible related specific selection criteria (Article 155 of IPA Implementing Regulation); • Ensuring that operations within their sectoral area of responsibility are selected for funding and approved in accordance with the criteria applicable of the OP; • In its capacity as a beneficiary, assistance in the technical preparation and management of the projects on the basis of formal agreements with the implementing body; • Quality appraisal of major projects prepared by the Final Beneficiaries (where relevant) and their submission to the National IPA Coordinator; • Submission to the National Fund of requests for payment and all supporting documents; • Ensuring that the National Fund and the National Authorising Officer receive all necessary information on the procedures and verifications carried out in relation to expenditure; • Ensuring internal audit of its different constituting bodies; • Ensuring irregularity reporting; • Ensuring risk management reporting; • Ensuring compliance with the information and publicity requirements. Croatian Railways Infrastructure (as an Implementing Body) will execute the following functions with relation to the OP Priority Axis 1 – Upgrading Croatia’s rail transport system: Verification of tender documents received from beneficiary institutions and preparation of complete tender dossiers; Arranging tendering and contract award procedures; Acting as the Contracting Authority; Contract implementation; Preparation and submission of payment claims to the body responsible for measure/priority; Making payments to, and recoveries from, the final beneficiary; Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; Verifying that expenditure declared has actually been incurred in accordance with applicable rules, that the products or services have been delivered in accordance with the approval decision, and that payment requests by the final beneficiary are correct. These verifications shall cover the administrative, financial, technical and physical aspects of operations, as appropriate; Supporting the preparation of documents for the sectoral monitoring committee regarding progress made towards achieving the targets of the measures; Support in the preparation of sectoral annual and final implementation reports; Maintaining a separate accounting system or a separate accounting codification; Internal audit; Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; Irregularity reporting.
The Central Finance and Contracting Agency for EU Programmes and Projects (CFCA) (as an Implementing Body) will execute the following functions with relation to the OP Priority Axis 2 – Upgrading Croatia’s inland waterway system74 and Priority Axis 3 – Technical Assistance: Verification of tender documents received from beneficiary institutions and preparation of complete tender dossiers; Arranging for tendering and contract award procedures; Acting as the Contracting Authority; Contract implementation; Preparation and submission of payment claims to the body responsible for measure/priority; Making payments to, and recoveries from, the final beneficiary; Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; Support in the preparation of documents for the sectoral monitoring committee regarding progress made towards achieving targets of the measures; Support in the preparation of sectoral annual and final implementation reports; Maintaining a separate accounting system or a separate accounting codification; Internal audit; Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail;
74 The CFCU will be the Implementing body for the Priority Axis 2 only until such time that the Croatian Inland Waterways Agency obtains accreditation to act as the Implementing Body
92 Irregularity reporting.
All the bodies within the Operating Structure are ultimately accountable to the Ministry of Sea, Tourism, Transport and Development which bears overall responsibility for the Operational Programme management, in the execution of their specific tasks in relation to this Operational Programme. A detailed organigramme of the Operational Programme management system is provided in Annex 3
5.1.2 Separation of functions
In accordance with the Article 21.2 of the IPA Implementing Regulation, the appropriate segregation of duties will be ensured between and within the designated bodies Separation of functions between the bodies The separation of functions results from the division of the tasks described above. This includes the following principles: on the one hand, a clear separation between verifications, controls, and evaluations to be carried out by the Operating Structure and by the National Fund; and on the other a clear separation between the audits carried out by the Audit Authority and the implementation and payment procedures. Separation of functions within the bodies The organisational structure of the bodies and their internal management and control procedures will take into account all requirements to ensure the proper separation of functions. This includes the following principles: before an operation is authorised, the operational and financial aspects shall be verified by members of staff other than the one responsible for initiation or implementation of the operation; certificates of statement of expenditure shall be drawn up by a person or department within the National Fund who is functionally independent from any services that approve claims; initiation, ex-ante, and ex-post controls are separate functions, to be carried out by different persons, functionally independent from each other.
5.2. Monitoring and evaluation
5.2.1. Monitoring arrangements – In order to ensure coherence and coordination in the implementation of the IPA components, programmes and operations as well as to follow the progress in the implementation of IPA assistance, the following monitoring committees will be established:
IPA Monitoring Committee; Sectoral Monitoring Committee for the Transport Operational Programme.
IPA Monitoring Committee Croatia will establish an IPA Monitoring Committee to ensure coherence and coordination in the implementation of all five Components of IPA.
Sectoral Monitoring Committee The Head of the Operating Structure will establish a Sectoral Monitoring Committee within 6 months after the entry into force of the IPA Implementing Regulation This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her
93 representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission. The Sectoral Monitoring Committee will be assisted by a permanent secretariat provided by the Operating Structure for the preparation of papers for discussion by the committee or for clearance by written procedure. The secretariat's tasks will be carried out by the Directorate for Strategic Infrastructure Projects. The Sectoral Monitoring Committee will report to the IPA Monitoring Committee. Its tasks will include to: a. Consider and approve the general criteria for selecting operations and approve any revision of those criteria in accordance with programming needs; b. Review at each meeting progress towards achieving the specific targets of the Operational Programme on the basis of documents submitted by the Operating Structure; c. Examining at each meeting the results of implementation, particularly the achievement of the targets set for each priority axis and measure and interim evaluations (it shall carry out this monitoring by reference to the indicators agreed); Information on the number of jobs created as a result of the implementation of individual projects should be specifically reported and monitored (this information has to be forwarded to IPA Monitoring Committee) d. Examining the sectoral annual and final reports on implementation, including OP summary tables; e. Inform itself of the annual audit activity report or of the part of the report referring to the Operational Programme; f. Examine any proposal to amend the financing agreement of the programme and propose to the Operating Structure any revision or examination of the Programme likely to make possible the attainment of the programme's objectives or to improve its management, including its financial management, as well as to oversee cross cutting themes and publicity measures. The Sectoral Monitoring Committee shall confirm or make proposals to the Head of the Operating Structure, to the European Commission, the Strategic Co-ordinator and the National IPA Co-ordinator to revise the programme, where relevant, following an evaluation, including its results, as well as output and financial indicators to be used to monitor the assistance. The Sectoral Monitoring Committee will set up its rules of procedure in agreement with the Operating Structure and the IPA Monitoring Committee. It will meet at least twice a year and upon request by the Commission. Intermediate meetings may also be convened as required. As a principle the Sectoral Monitoring Committee will aim to take decisions by reaching consensus.
5.2.2 Management Information System
The Head of the Operating Structure is responsible for the efficiency and correctness of management and implementation and in particular for setting up, maintaining and updating regularly a reporting and information system to gather reliable financial and statistical information on implementation, for the monitoring indicators and for evaluation and for forwarding this data in accordance with arrangements agreed between the NIPAC and the Commission. This system will be developed into one or several computerised system(s), in a form chosen by the Operating Structure, which will enable it to: monitor and manage the implementation of operations and projects, from the moment of tendering and call for proposal to the closure of the OP, in particular the results, whenever feasible, and outputs; carry out and monitor financial transactions; ensure the reporting requirements on the implementation of the OP.
94 The Operating Structure and all other bodies involved in the implementation of the OP shall have access to this system. The Management Information System will be developed under the Technical Assistance component of this Operational Programme. The establishment of the Management Information System will be done under the guidance and supervision of NIPAC and the Strategic Coordinator, in order to ensure consistency and complementarity across all the Operational Programmes. Until the system becomes operational, reporting and collection of data will be done manually.
5.2.3 Monitoring System and Indicators
The quantitative and qualitative progress made in implementing the programme as well as its efficiency and effectiveness in relation to its objectives will be measured by the use of evaluation and monitoring indicators related to the results and outputs of the individual measures. In identifying appropriate monitoring and evaluation indicators, account has been taken of the methodologies, guidelines and lists of examples of indicators issued by the Commission, in particular the "Indicative guidelines on evaluation methods: Monitoring and evaluation indicators" (August 2006, working document No. 2 for the programming period 2007-2013). The Head of the Operating Structure is responsible for programme monitoring. In this context, the Operating Structure will collect performance data (outputs, results and expenditure) from operations and projects. It will establish, maintain and update the reporting and information system by taking this project-level data and aggregate it to measure, priority axis and whole OP levels. Data on individuals who are the ultimate beneficiaries must be collected for each project and used for aggregation at measure and priority level. On this basis the Operating Structure will assess the progress of the OP at each level against objectives and targets, prepare reports to the Sectoral Monitoring Committee, draft the sectoral annual and final reports on implementation and launch interim evaluations if required. In the context of monitoring and for the purpose of using indicators, the role of the Operating Structure will also be to ensure that: a. Monitoring requirements are built into the calls for tender and proposals documents (including preparation of the major project application forms, terms of reference and tender documentation); b. Project applications (when appraised and selected) include proposed outputs and results, as well as data on individuals, that are consistent with the OP indicators for the appropriate measure; c. Provision of data is built into the contract with beneficiaries as an obligation, and that performance data is provided systematically and in a timely manner by beneficiaries alongside the project reimbursement claim; An indicative breakdown by category of the programmed use of the Community contribution to this Operational Programme will be established for monitoring and information purposes while the sectoral annual and final reports on implementation will provide information on the use of expenditure in accordance with such categories.
5.2.4 Selection of operations
All operations which are not major projects, and which are implemented by final beneficiaries other than national public bodies, shall be selected through calls for proposals. The Operating Structure will set up a Selection Committee for each call for proposals launched for the selection of operations financed under a specific measure. The Selection Committee will have an odd number of members and it will be composed of the most appropriate officials and experts with technical competence to undertake a qualitative appraisal of project applications. These members will be nominated by the institutions in which where they are employed at the invitation of the body in charge of implementation, and they will have voting rights in the selection process. A member of the Operating Structure who prepared the guidelines for applicants will also participate in the Selection Committee work. The Committee will be chaired by a member of the Implementing Body without a voting right. The Selection Committee will appraise project applications in compliance with the selection criteria and methodologies agreed by the Sectoral Monitoring Committee. The applications will first be screened for their compliance with the eligibility and administrative criteria meeting the relevant eligibility requirements set out in the relevant measures (completeness, accuracy, etc) and thereafter will be evaluated according to their quality. The
95 Selection Committee will then make recommendations to the Operating Structure, in compliance with Article 158 of the IPA Implementing Regulation. Procurement (including the award of any major projects) will follow the contract award procedures contained in the “Practical Guide to Contract Procedures for EC External Actions” (PRAG). Tender Selection Committees will be established for the evaluation of service, works and supply tenders, while their composition and decision making procedures will be in accordance with the principles set out in the relevant rules of the PRAG. All beneficiaries (whether public or private) will also comply with the principles established under the relevant PRAG rules.
5.2.5 Sectoral annual and final reports on implementation
Sectoral annual and final reports on implementation will be prepared by the Operating Structure in accordance with article 169 of the IPA Implementing Regulation. These reports will assess the implementation progress covering the attainment of set objectives, the problems encountered in managing the programme and the measures taken, the financial execution as well as monitoring and evaluation activities carried out. This will include specific progress reports on each major project, in accordance with the format to be agreed with the Commission. Programmes will include an up-to-date OP summary table and will be reviewed at least at the “second meeting” of the Sectoral Monitoring Committee each year.
5.2.6 Evaluation arrangements
Evaluations are a tool for assessing the relevance, efficiency and effectiveness of the financial assistance as well as the impact and sustainability of the expected results. As a minimum, an ex-ante evaluation and an interim evaluation will be carried out under the responsibility of the Head of the Operating Structure and the Strategic Coordinator, in accordance with the principles laid down in the IPA Implementing Regulation and guidance provided by the Commission. The evaluation arrangements and activities of each programme will fully respect the principle of proportionality. Ex-ante evaluation Under the responsibility of the Operating Structure and the Strategic Coordinator, an ex-ante evaluation of the Transport Operational Programme was carried out by the European Policy Research Centre at the University of Strathclyde in Glasgow and is annexed to this programme. A summary of the results of the ex-ante evaluation and the way the evaluation was conducted is set out in section 1.5. Interim evaluation The Head of the Operating Structure is responsible for ensuring that adequate evaluations of the Operational Programme are carried out. The evaluations will be carried out by external experts, functionally independent from the management and control system. The evaluations will be managed by a designated official within the Ministry of Sea, Tourism, Transport and Development, who will be responsible for preparing the documents for tendering and contracting these experts under Priority Axis 3, reviewing the draft evaluation reports, acting as secretariat to the ad hoc Evaluation Committee, and liaising, as appropriate, between the selected experts and the said Committee. Evaluation committee The Sectoral Monitoring Committee will designate an ad-hoc committee to assist the Operating Structure in its evaluation activities. The Committee will adhere to the 'partnership principle' and will include members (and invitees where relevant) who are experts in evaluation. Moreover, the assistance of the Committee will be availed of at all stages of the process (including guidance, planning, implementation and communication of results) in order to ensure the overall quality of the evaluations undertaken. At the same time, all relevant stakeholders and institutions / organisations will be invited to contribute where appropriate.
The designation and establishment of this ad-hoc Committee will be made in accordance with the Sectoral Monitoring Committee’s rules and procedures adopted in accordance with Article 167.2 of the IPA Implementing Regulation.
96 Evaluation activities and timing Given this programme covers the 2007-09 period, but involves operational activity up to 31 December 2012 under the N+3 rule, it is proposed that only one interim evaluation is carried out, and that this will commence in October 2009. As no larger-scale projects will have been completed at this stage, this would be effectively a process evaluation examining the efficiency and effectiveness of programme and project implementation, but within the context of the progress made with implementation, including the performance against indicators at the project level (physical and financial objectives) and at the measure level (outputs). This will also include a review of performance on the horizontal themes of the OP.
5.3 Information and publicity
5.3.1 Introduction
Information and publicity are important aspects of pre-accession assistance and in particular to the successful design and delivery of the Operational Programmes, given the partnership basis on which they are undertaken. Communicating for a successful management and implementation of the Operational Programmes can be broken down into a series of information and publicity activities. Accordingly, Article 62 of the IPA Implementing Regulation sets out certain requirements regarding the information to be provided and publicity of programmes and operations financed by the Community, addressed to citizens and beneficiaries with the aim of highlighting the role of Community funding and ensuring transparency. The information to be provided by the Operating Structure should include inter alia the publication of the list of final beneficiaries, the names of the operations and the amount of Community funding allocated to operations. The Commission must also ensure the publication of the relevant information on tenders and contracts in the official Journal of the European Union and other relevant media and websites. Article 63 of the IPA Implementing Regulation provides further that the Commission and the relevant authorities of the beneficiary country shall agree on a coherent set of activities, to be funded from the TA priority of the Operational Programme, to make available and publicise information about IPA assistance. In accordance with the above provisions the Ministry of Sea, Tourism, Transport and Development, Directorate for Strategic Infrastructure projects shall be responsible for the information and publicity activities under the programme. The information shall be addressed to the citizens of Croatia and to the European citizens in general, and to the (potential) beneficiaries. It shall aim to highlight the role of the Community and ensure that IPA assistance is transparent.
5.3.2 Requirements
In compliance with Article 63 of the IPA Implementing Regulation the Ministry of Sea, Tourism, Transport and Development, Directorate for Strategic Infrastructure projects shall prepare a Communication Action Plan (CAP) to provide strategic coherence to the set of activities to publicise information about IPA assistance. The Communication Action Plan shall be consistent with the information and publicity strategy issued by NIPAC. The CAP shall cover the period 2008-2012. The Ministry of Sea, Tourism, Transport and Development will submit a draft of the Communication Action Plan to the NIPAC and Commission within four months of the date of signature of the Financing Agreement covering the Operational Programme. As a minimum the Communication Action Plan shall include the following points: The aims and target groups; The strategy and content; The indicative budget; The administrative departments; The criteria used for evaluation.
97 5.3.3 Activities
The Ministry of Sea, Tourism, Transport and Development shall ensure that the information and publicity measures are implemented in accordance with the Communication Action Plan aiming at the broadest possible media coverage using all suitable forms and methods of communication at the appropriate territorial level. The Ministry of Sea, Tourism, Transport and Development will be responsible for organising at least the following information and publicity measures: A major information activity publicising the launch of an Operational Programme, even in the absence of the final version of the Communication Action Plan; At least one major information activity a year, as set out in the Communication Action Plan, presenting the achievements of the Operational Programme including major projects; The publication (electronically or otherwise) of the list of beneficiaries, the names of the operations and the amount of Community and national funding allocated to the operations The Ministry of Sea, Tourism, Transport and Development shall provide potential beneficiaries with clear and detailed information on at least the following: The possibility of financing opportunities offered jointly by the Community and the beneficiary country through the OP; The conditions of eligibility to be met in order to qualify for financing under the Operational Programme; A description of the procedures for examining applications for funding and of the time periods involved; The criteria for selecting the operations to be financed; The contacts at national, regional or local level that can provide information on the Operational Programme.
5.3.4 Indicative budget
The indicative budget for the Communication Action Plan under this Operational Programme for the period 2007-2009 will be set at an appropriate level in order to provide adequate cover for the costs of the publicity and information measures. The budget allocation per year, as well as the indicative amounts necessary for the period 2010-2013, will also be presented in the Communication Action Plan. 5.3.5 Management and implementation Within the Ministry of Sea, Tourism, Transport and Development, information and communications will be assigned to Directorate for Strategic Infrastructure projects. The information and publicity team will be composed of 1 official whose tasks will involve supporting the Head of the Operating Structure in the performance of the following functions and responsibilities: Discussing the Communication Action Plan with the Commission; coordinating the information and publicity activities under other IPA funded programmes; Communication with the media; Elaboration, implementation and assessment of the programme's Communication Action Plan; Presenting the programme in the relevant national and Commission information networks; Handling enquiries from beneficiaries; Monitoring and control on the fulfilment of the P&I requirements from the beneficiaries; Development, production and distribution of information material; the preparation and implementation of public events; Development and maintenance of the contents of the programme website; Liaison with IT regarding technical maintenance;
98 Management of out-sourced services; Elaboration and monitoring of the annual Communication Action Plans and coordination of internal events and training. Given that some of the information and publicity measures will require out-sourcing for professional services (such as design and pre-print, web pages, printing, advertising, photography and opinion pools), it will be the responsibility of the information and publicity team to manage such services and ensure they are contracted in accordance with public procurement rules. 5.3.6 Monitoring, evaluation and reporting Monitoring, evaluation and reporting are a compulsory requirement for the implementation of the publicity measures included within the Communication Action Plan of the programme. The progress made in the implementation of the Communication Action Plan shall be reported during the meetings of the Sectoral Monitoring Committee. The Head of the Operating Structure shall inform the Sectoral Monitoring Committee of the information and communication measures carried out and the means of communication used. The Head of the Operating Structure will also provide the Sectoral Monitoring Committee with examples of the communication measures carried out. The annual and final reports on the implementation of the Operational Programme shall include the following information: Examples of information and communication measures for the Operational Programme undertaken during the implementation of the Communication Action Plan; The arrangements for the information and publicity measures concerning the publication - electronically or otherwise - of the list of beneficiaries, the names of the operations and the amount of public funding allocated to the operations; The content of major amendments to the Communication Action Plan. A set of indicators for the evaluation of the publicity measures will be included in the Communication Action Plan and will represent the essential part of the plan with regard to the assessment of the efficiency and effectiveness of the implemented publicity activities. The yearly results of the qualitative and quantitative analysis will be used for the elaboration of the annual Communication Action Plans, including any modifications thereof. 5.3.7 Partnership and networking Bodies that can act as relays for the programme and disseminate the information concerning the general public will include the following: Professional and trade associations and organisations; Economic and social partners; Non-governmental organisations; Educational institutions; Organisations representing business; EU Information centres and Commission Representations (in particular the EC Delegation); Other main stakeholders under each priority. The Operating Structure will work in close cooperation with the above-mentioned bodies for the dissemination of information regarding the programme and in particular the IPA pre-accession assistance strategy for component IV. 5.3.8 Internet The website of the programme will be linked to the CODEF, MFIN, ECD, DG ELARG, DG EMPL and DG REGIO websites and with the websites of the other programmes. It will be created according to the following principles:
99 Accessibility to as many users as possible – ensuring the site has a simple address; registering it on main search engines so it can be found easily; designing it to be viewable with low specification screens and software; ensuring it is quick to download. Prioritising fast access to rich information – the site should be clearly organised so users can find what they are looking for quickly and easily; the information should be available as downloadable pdf format documents, where possible. Visual appeal – strong visual identity through logos, use of colours etc. without limiting the clarity, speed and simplicity Developing as an ongoing resource Interactive content, exploiting the unique strengths of websites
100 ANNEX 1: MEMBERSHIP OF INTER-MINISTERIAL WORKING GROUP (IWG) (Note: * indicates designated lead ministry for managing the OP)
Central Office for Development Strategy and Coordination of EU Funds (CODEF) - Ms Nataša Mikuš, Deputy State Secretary (Chair, IWG) - Mr. Vjeran Bašić, Head of Section - Mr Dalibor Dvorny, Expert Assistant
Ministry of the Sea, Tourism, Transport and Development (MSTTD)* - Mr. Mate Jurišić, Assistant Minister - Mr. Dražen Antolović, Senior Advisor
Ministry of Environmental Protection, Physical Planning and Construction (MEPPPC) - Ms. Anita Gulam, Advisor
Ministry of Foreign Affairs and European Integration (MFAEI) - Ms. Željka Babić, Expert Assistant
Central Bureau of Statistics - Ms. Edita Omerzo Advisor
CARDS 2003: Support to National Development Planning - Mr Franz Goetz, External Expert Consultant
101 ANNEX 2: INDICATIVE LIST OF PROJECTS AND THEIR IDENTIFICATION CARDS
Estimated value of Project name Measure projects in Euros Project number
PRIORITY AXIS 1 1 Zagreb Main Station Signalling and Interlocking Measure 1.2 17,900,000 System 2 Line Rehabilitation Okučani to Novska Section Measure 1.1 38,500,000
3 Line Rehabilitation Novska to Dugo Selo Section Measure 1.1 135,000,000
4 Line Rehabilitation Zaprešić to Savski Marof Measure 1.1 25,000,000 Section
PRIORITY AXIS 2 5 Rehabilitation and Improvement of the Sava River Measure 2.1 40,000,000 Waterway 6 Reconstruction of the Port of Vukovar – New Port Measure 2.1 40,000,000 East
102
Project No: 1 Priority Axis: 1 Measure No.: 1.2 Project location: Zagreb 1. Project name Zagreb Main Station Signalling and Interlocking System 2. Investment value 17,900,000 EUR (estimated) • installation of the new electronic signalling equipment on the Zagreb Main Station line, and the neighbouring branching point Trešnjevka including removal of the old equipment • installation of the new equipment for control of the inter-station distance between Zagreb Main Station and Zagreb West Station including removal of the old equipment 3. Description of main • replacement of the old outdoor safety elements and cables, and construction of the interface to project components the neighbouring fail-safe signalling equipment and/or activities • upgrade and rehabilitation of telecommunications to support the new signalling and interlocking system • minor track works on adjustment of the existing station tracks and adjustment of overhead line equipment • adaptation of the existing equipment building
• to replace the almost 70 years old relay interlocking system with the new generation of electronic 4. Description of main signalling equipment in one of the biggest and busiest railway stations in Croatia. project objectives and • expected results are expected results − Improved safety and reliability of the signalling and interlocking equipment − Maintenance cost savings − Increase of the speed of trains, and capacity of the station
5. Month and year of start of 6. Month and year of end project implementation 06/2008 of project 12/2010 7. Project duration (months) 30 implementation 8. Readiness of basic project documentation Document type status status description completion date comment Not necessary for a reconstruction / upgrading Pre-feasibility study n/a n/a project Feasibility study (with cost- The study commissioned from a local benefit analyses which in progress 06/2007 company. Due to be delivered beginning of includes economic and July 2007 financial analysis) For an reconstruction / upgrade project full EIA procedure not required EIA study in progress 07/2007 Environmental protection report will enable the determination by the competent national authority Tender documents in progress 12/2007 Other (specify) 9. Status of project design documentation and permits Status status description Documentation type (tick (none/in progress/ completion date comment box) completed) Project part 1 – Signalling and Interlocking Conceptual design n/a n/a Preliminary design n/a n/a Main design completed 05/2007
103 To be developed by the Contractor under Final design none FIDIC yellow book Location Permit n/a n/a Not applicable Building Permit none 12/2007 Project part 2 – Telecommunications Conceptual design n/a n/a Preliminary design n/a n/a Main design n/a n/a To be developed by the Contractor under Final design none FIDIC yellow book Location Permit n/a n/a Not applicable Building Permit n/a n/a Not applicable Other – Technical To be determined by technical department of the in progress 9/2007 requirements beneficiary Project part 3 – Civil Engineering-Track Conceptual design n/a n/a Preliminary design n/a n/a Main design completed 2006 Final design n/a n/a Not needed Location Permit n/a n/a Not applicable Building Permit n/a n/a Not applicable Project part 4 – Civil Engineering-Building Conceptual design n/a n/a Preliminary design n/a n/a Main design n/a n/a To be developed by the Contractor under Final design none FIDIC yellow book Location Permit n/a n/a Not applicable Building Permit n/a n/a Not applicable Other – Technical Determined in the main design for Signalling completed requirements and Interlocking 10. Description of the land ownership status: Within the existing infrastructure – no land acquisition needed.
Zagreb Main Station is the main railway junction for inter-city and long distance passenger and freight transport on the X and Vb Corridors. It is equipped with relay fail-safe signalling equipment, which was 11. Describe current project installed in 1940. Some parts of this equipment were replaced in the meantime. status The speed within the station is currently reduced to 30 km/h, due to the condition of signalling equipment. The spare parts for such obsolete equipment are hard to obtain, which makes the technical maintenance very difficult and expensive.
12. Name of final beneficiary Croatian Railways Infrastructure 13. Name of Operator Croatian Railways Infrastructure
104 14. Sources of financing
National component IFI (EIB) Other donor (specify) Proposed (including final beneficiary) IPA grant
4.5 M EUR ……-…….EUR ……-…….EUR 13.4 M EUR
15. Additional Comments: Replacement of the relay fail-safe signalling equipment is the first phase of the reconstruction of the Zagreb Main Station and the prerequisite to the further reconstruction of the station.
105 Project No: 2 Priority Axis: 1 Measure No.: 1.1 Project location: County: Sisak - Moslavina 1. Project name Line Rehabilitation Okučani to Novska Section 2. Investment value 38.500.000 EUR (estimated)
• track overhaul of the 19,5 km double track line with replacement of the permanent way material • reconstruction of station tracks in Okučani 3. Description of main • rehabilitation of the Rajić halting-place project components • rehabilitation of the substructure, culverts and drainage system, and/or activities • installation of ETCS system • adjustment of overhead line equipment
4. Description of main • to achieve speed of 160 km/h project objectives and • to increase line capacity expected results • to decrease maintenance costs
5. Month and year of start of 6. Month and year of end project implementation 06/2009 of project 06/2011 7. Project duration (months) 24 implementation 8. Readiness of basic project documentation Document type status status description completion date comment not necessary for an reconstruction / upgrade Pre-feasibility study n/a n/a project Feasibility study (with cost- To be proposed for financing / reallocation benefit analyses which none 09/2008 under ISPA measure IPA Project Pipeline includes economic and Preparation (Transport) financial analysis) To be proposed for financing / reallocation EIA study none 09/2008 under ISPA measure IPA Project Pipeline Preparation (Transport) Tender documents none 10/2008 Other (specify) 9. Status of project design documentation and permits Status status description Documentation type (tick (none/in progress/ completion date comment box) completed) Project part 1 – Civil, Track & Electrification Conceptual design n/a n/a Preliminary design in progress 09/2007 Only for the reconstruction in Okučani Main design n/a n/a Final design in progress 01/2008 Location Permit none 12/2007 Only for the reconstruction in Okučani Building Permit none 06/2008 Project part 2 – Signalling &Telecommunications Conceptual design n/a n/a Preliminary design in progress 09/2007 Only for the reconstruction in Okučani Main design n/a n/a Final design in progress 01/2008 Location Permit none 12/2007 Only for the reconstruction in Okučani
106 Building Permit none 06/2008 Other 10. Description of the land ownership status: Within the existing infrastructure – no land acquisition needed.
• double-track line for both passenger and freight transport • track gradient up to 6‰ and horizontal alignment that allows the speed up to 160 km/h, with the exception of a curve on the exit of the railway station Okučani where max speed is 100 km/h, • last overhaul in period 1980-1981; due to the poor condition of the track the speed is reduced to 11. Describe current project 120 km/h status • category D4: maximum permissible axle load 22.5 t/axle, i.e. 8 t/m • clearance gauge: UIC GC • electrified with AC 25kV/50Hz system • breaking distance: 1500 m
12. Name of final beneficiary Croatian Railways Infrastructure 13. Name of Operator Croatian Railways Infrastructure
14. Sources of financing
National component IFI (EIB) Other donor (specify) Proposed (including final beneficiary) IPA grant
9.6 M EUR ……-…….EUR ……-…….EUR 28.9 M EUR
The capacity of this section was under-utilised in 2005 – utilisation of the section was 22 %. Despite the low utilisation of capacity on this section, the average speed was reduced in 2006 due to the poor track 15. Additional Comments: condition and it will be reduced further, if the line is not rehabilitated; therefore the overhaul of this line
section is necessary on a long term basis
In addition, the intervention needed to achieve these speeds is rather simple, no land acquisition is
expected and the project preparation (technical design, permits) can be finalised in a shorter time period
than for the single-track sections. Hence, this project is proposed for implementation before the single-
track sections.
Project No: 3 Priority Axis: 1 Measure No.: 1.1 Project location: Counties: Zagreb, Sisak - Moslavina 1. Project name Line Rehabilitation Novska to Dugo Selo Section 2. Investment value 135.000.000 EUR (estimated) • 3 phases: I. Novoselec – Dugo Selo 27.1 km II. Kutina – Novoselec 27.7 km III. Novska – Kutina 26.5 km 3. Description of main • track overhaul of the 81.3 km single track line including reconstruction of station tracks project components • reconstruction of sections of curved track to increase speed to 160 km/h and/or activities • rehabilitation of the substructure, culverts and drainage system, • replacement of level crossings with bridges on a higher rank state roads, rehabilitation of other level crossings • replacement of the relay signalling equipment with electronic equipment and installation of ETCS system
107 • centralised traffic control system covering route from Okučani to Dugo Selo including CTC centre in Zagreb to manage traffic operations from Slovenian border to a point west of Vinkovci • upgrade of telecommunication system including the introduction of new GSM-R system • adjustment of overhead line equipment
• increase speed to160 km/h 4. Description of main • introduce interoperability through ETCS project objectives and • increase line capacity expected results • reduce maintenance costs • reduce number of employees
5. Month and year of start of Up to 3 6. Month and year of end project implementation years 3/2010 of project 12/2013 7. Project duration (months) per implementation phase 8. Readiness of basic project documentation Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost- benefit analyses which To be proposed for financing under IPA none 12/2008 includes economic and measure 1.1 financial analysis) To be proposed for financing under IPA EIA study none 12/2008 measure 1.1
Tender documents none 6/2009 Other (specify) 9. Status of project design documentation and permits Status status description Documentation type (tick (none/in progress/ completion date comment box) completed) Conceptual design n/a n/a To be proposed for financing under IPA Preliminary design none 10/2008 measure 1.1 Main design none To be proposed for financing under IPA Final design none 5/2009 measure 1.1 Location Permit none 1/2009 Building Permit none 11/2009 Other 10. Description of the land ownership status: Approximately 90% within the existing corridor – NO land ownership issues. Land acquisition needed in several locations where major reconstruction of sections of curved track or extension of station tracks is planned.
Overall characteristics • single-track line for both freight and passenger transport 11. Describe current project track gradient of up to 5% and horizontal alignment that allows the speed of maximum 130 km/h status • with the exception of individual curves which limit the speed predominantly on the entrance or exit of the railway stations
108 • last overhaul during 1979-1986 period (Novska station in 1971) and due to the bad condition of the track the speed has been reduced to 70/80 km/h • category D4: maximum permissible axle load 22.5 t/axle, i.e. 8 t/m • clearance gauge: UIC GC • electrified with AC 25kV/50Hz system • relay fail-safe signalling equipment in stations installed in 1960-s • interlocking equipment on interstation distances is automatic block; breaking distance 1000 m.
Novoselec – Dugo Selo stations: Dugo Selo Ivanić Grad and Novoselec Kutina – Novoselec stations: Ludina, Popovača, Moslavačka Gračenica and Kutina Novska - Kutina Stations: Banova Jaruga, Lipovljani and Novska
12. Name of final beneficiary Croatian Railways Infrastructure 13. Name of Operator Croatian Railways Infrastructure
14. Sources of financing
National component IFI (EIB) Other donor (specify) Proposed (including final beneficiary) IPA grant
33.8 M EUR ……-…….EUR ……-…….EUR 101.2 M EUR
The capacity utilisation on this section in 2005 was up to 63%. With the further deterioration of track 15. Additional Comments: condition and increase in traffic volumes this single-track section from Novska to Dugo Selo will soon
become a bottleneck of the Corridor X in Croatia.
The investment proposed under this IPA measure will provide expansion of the existing capacity of the
line to accommodate the forecast increases in traffic over the next 10-15 years period, after which time
track duplication will have to be considered.
109 Project No: 4 Priority Axis: 1 Measure No.: 1.1 Project location: County: Zagreb 1. Project name Line Rehabilitation Zapresic to Savski Marof Section 2. Investment value 25,000,000 EUR (estimated) • track overhaul of the 7.5 km double track line with replacement of the permanent way material • reconstruction of station tracks in Zapresic and Savski Marof • rehabilitation of the substructure, culverts and drainage system, • replacement of level crossings with bridges on higher rank state roads, rehabilitation of other level crossings 3. Description of main • replacement of the relay fail-safe signalling equipment with electronic equipment which will be project components remotely controlled from the Central Traffic Control centre in Zagreb and fitted with ETCS system and/or activities • re-positioning of signals to enable the speed of 160 km/h • upgrade of the telecommunication system (including the installation of new GSM-R system) and adjustment to the new Centralised Traffic Control System • adjustment of the overhead line equipment
• increase speed to160 km/h 4. Description of main • introduce interoperability through ETCS project objectives and • increase line capacity expected results • reduce maintenance costs • reduce number of employees
5. Month and year of start of 6. Month and year of end project implementation 9/2010 of project 7/2013 7. Project duration (months) 34 implementation 8. Readiness of basic project documentation Document type status status description completion date comment
Pre-feasibility study n/a n/a Feasibility study (with cost- benefit analyses which To be proposed for financing under IPA none 10/2009 includes economic and measure 1.1 financial analysis) To be proposed for financing under IPA EIA study none 10/2009 measure 1.1 To be proposed for financing under IPA Tender documents none 1/2010 measure 1.1 Other (specify) 9. Status of project design documentation and permits Status status description Documentation type (tick (none/in progress/ completion date comment box) completed) Conceptual design n/a n/a none To be prepared within ISPA TA Project pipeline Preliminary design 6/2008 preparation none To be proposed for financing under IPA Main design 8/2009 measure 1.3: Project Pipeline Preparation Final design none Location Permit none 12/2008 Building Permit none 12/2009
110 Other 10. Description of the land ownership status: Land acquisition needed for station tracks extension / reconstruction.
• double-track line for both passenger and freight transport • track gradient up to 5‰ and the horizontal alignment that allows the speed up to 160 km/h, with the exception of the railway station Zapresic, • last overhaul in period 1972; due to the poor condition of the track the speed is reduced to 80/120 km/h 11. Describe current project • category D4: maximum permissible axle load 22.5 t/axle, i.e. 8 t/m status • clearance gauge: UIC GC • electrified with AC 25kV/50Hz system • interlocking system between the state border and Savski Marof is interstation dependence (1 block between stations) and between Savski Marof and Zapresic automatic block • relay fail-safe signalling equipment is installed at the railway stations • breaking distance: 1000 m
12. Name of final beneficiary Croatian Railways Infrastructure 13. Name of Operator Croatian Railways Infrastructure
14. Sources of financing
National component IFI (EIB) Other donor (specify) Proposed (including final beneficiary) IPA grant
6.25 M EUR ……-…….EUR ……-…….EUR 18.75 M EUR
15. Additional Comments: The central point of this project is the reconstruction of the railway station Zaprešić that will enable the separation of passenger and freight traffic in the area of Zagreb junction through the future freight by- pass on the western entrance to Zagreb.
111 Project No: 5 Priority Axis: 2 Measure No.: 2.1 Project location Rehabilitation and Improvement of the Sava River Waterway 1. Project name
2. Investment value 40.000.000 € (estimated) Activities: 1. Execute dredging works to improve Sava fairway depth in Sections I - XIV 2. Construction of waiting areas and traffic guidance in 2 sharp river bends in Sections XI – XIII 3. Description of main 3. Construction of waiting areas and traffic guidance in 6 project components sharp river bends in Section XII - XIV and/or activities 4. Upgrading of the marking system and maintenance in arrear for the Captaincies of Sl. Brod and Sisak 5. Replacement of the Jasenovac and Galdovo bridges to guarantee minimum vertical clearance
4. Description of main Rehabilitation and improvement of the Sava, to CEMT IV class project objectives and expected results
5. Month and year of start of 6. Month and year of end project implementation 06/2008 of project 06/2010 7. Project duration (months) 24 implementation 8. Readiness of basic project documentation Document type status status description completion date comment
Pre-feasibility study YES Feasibility study (with cost- benefit analyses which NO In progress 03/2008 includes economic and financial analysis)
EIA study NO In progress 06/2008
Tender documents NO Other (specify) --- 9. Status of project design documentation and permits Status status description Documentation type (tick (none/in progress/ completion date comment box) completed) Conceptual design YES Completed Preliminary design YES Completed Main design NO Final design NO Upon adoption of EIA Location Permit NO 12/2008 Study
112 Building Permit NO Other (specify) --- 10. Description of the land ownership status: State
Currently the project is in the Feasibility study and Environment study phase of development 11. Describe current project status
12. Name of final beneficiary Agency for Inland waterways 13. Name of Operator
14. Sources of financing
National component IFI (specify) Other donor (specify) Proposed (including final beneficiary) IPA grant
10.0 M EUR ……-…….EUR ……-…….EUR 30.0 M EUR
15. Additional Comments: Project should be developed in close cooperation with Sava river commission and other members of Sava river commission. (Republic of Slovenia, Serbia and BiH)
113 Project No: 6 Priority Axis: 2 Measure No.: 2.1 Project location 1. Project name Reconstruction of the Port of Vukovar – New port East 2. Investment value 1. Phase - 22.000.000 € 2. Phase 18.000.000 € (estimated) 1.) Infrastructure: - Vertical key wall 700m, Reconstruction of rail tracks and port roads Suprastructure: - Multipurpose terminal (warehouse), Terminal for Weather protecting material handling, 3. Description of main Bulk terminal (Loading and unloading equipment, conveyers) project components 2.) and/or activities Infrastructure: - Vertical key wall 500m, Additional storage capacities
At the present moment port cannot response to growing transport demands. The reason is capacity limits
and availability of operational surface. The port has significant importance in transit of goods for Bosnia
and Herzegovina industry (80% of total cargo handled). 4. Description of main The poor capacity of the port is as a result of the breakdown in use during the war and an insufficient project objectives and level of renewal. expected results The project objective is, therefore, to develop modern port facilities that will trigger economic
development in Vukovar city and in the region.
The final result will be increased port capacity up to 2.5 mil tonnes per year and improvement of
operational safety. 5. Month and year of start of 6. Month and year of end project implementation 01/2008 of project 01/2012 7. Project duration (months) 48 implementation 8. Readiness of basic project documentation Document type status status description completion date comment
Pre-feasibility study YES Feasibility study (with cost- benefit analyses which YES includes economic and financial analysis) Partially (Included in Feasibility study. EIA study YES Separate EIA study is needed according to Croatian legislation in design phase) Tender documents NO
Other (specify) --- 9. Status of project design documentation and permits Status status description Documentation type (tick (none/in progress/ completion date comment box) completed) Conceptual design NO In progress 03/2008 Preliminary design NO Main design NO Final design NO Location Permit NO Building Permit NO Other (specify) --- 10. Description of the land ownership status: State ownership – Partially (80%) – 20% in process of dispossession.
114
Currently, the project is in stand-by phase, as adequate capacity for the design and engineering of the project does not, in the present moment, exist. 11. Describe current project status
12. Name of final beneficiary Port Authority Vukovar 13. Name of Operator
14. Sources of financing
National component IFI (specify) Other donor (specify) Proposed (including final beneficiary) IPA grant
3.0 M EUR 18.0 M EUR 7.0 M EUR 12.0 M EUR
15. Additional Comments:
115 ANNEX 3: DIAGRAM OF THE TOP INSTITUTIONAL STRUCTURE
ANNEX 4: SEE CORE REGIONAL NETWORK ACTION PLAN
Ranked Inter Cost Current Seq Mod (MCA) Cor Project Name Pre.-Cod Location Type Km Meur Status Route
Completion of Belgrade bypass,Sector 1-3:Dobenovci- 1 RD 1 Cor X SERRDO17.2 SER N 17.0 7.5 CD/FS Ostružnica RD 3 Cor X Completion of Belgrade bypass,Sector 4:Ostružnica-Orlovača SERRDO17.3 SER N 8.00 24 CD/FS RD 0 Cor X Compl. of Belgrade bypass,Sector 5-6:Orlovaca-Bubanj-Potok SERRDO17.4 SER N 14.0 136 CD/FS NEW 2 RD 13 Cor X Upgrading of road sec. Demir Kapija-Udovo-Smokvice MACRD008 MC U 33 150 CD TR 3 RD 28 Cor Vc Reconstruction of Šešlije-Šamac BIHRD006 BiH U 48 18.1
RD 37 Cor Vc Compl of motorway,Sec Zenica/Donja Gračanica-Kakanj BIHRD049 BiH N 24.16 230 (FS)FS (45) RD 30 Cor Vc Compl of motorway,Sec Kakanj-Vlakovo (Sarajevo bypass) BIHRD049 a BiH N 30 CD 30 RD 27 Cor Vc Construction of Mostar bypass,connected to Corridor Vc BIHRD010 BiH N 13 20 (TR)FS 4 RD 21 Cor VIII Construction of Rogozhinebypass on Corridor VIII ALBRD004 ALB N 4.30 0.02 CD 5 RD 23 Cor VIII Construction of motorway,Sec Deve Bair-Kriva Palanka MACRD29 MAC U 13.5 67.35 CD RD 35 Cor VIII Construction of motorway,Sec Gostivar-Bukojčani MACRD28 MAC R 30 102.8 CD Route 6 RD 18 Road rehabilitation (section: Debeli brijeg-Bar) MONRD030 MCN U 19 8 TR No. 1 Route 7 RD 4 Bypass Niksic MONRD028 MCN N 11 20 TR No.2b Route RD 11 Road rehabilitation (section:Scepan polje-Pluzine) MONRD038 MCN N 28 42 TR No.2b Route 8 RD 29 Constr of Brod na Drini (Foca)-Hum (Scepan polje) BIHRD021 BiH N 21 80 TR No.2b Route 9 RD 31 Upgrading Hani Hotit-Shkoder road ALBRD007 ALB U 34 26.64 (FS)FS No.2b Route 10 RD 24 Eastern mini-bypass Podgorica MONRD029 MCN N 6.5 20 FS No.4 Route 11 RD 36 Upgrading Milot-Morine road ALBRD013 ALB UN (110)88 144.3 CD,FS No.7 Route Kosovo sec (Pristina Region) of route No7 Br.Morina-Merdare to 14. NEW12 RD 34 KOSRD011a KOS N 104.1 CD,FS No.7 Corridor X and Duress 74
13 RW 9 Cor X Upgrading rail signalling and telecommunications along Cor X MACRW022 MAC U 37 6 (TR)PS Rehabilitation of the rail line Tabanovci-Gevgelija (Cor X) RW 10 Cor X MACRW025 MAC R 69 150 (TR)PS sec:Veles-Zgropolci-Demir Kapija Reconstr/upgr to double track line Beograd-Nis/Belgrade- NEW14 RW 15 Cor X SERRW022.6 SER N 76 150 TR Resnik-Klenje-M.Ivanca-M.Krsna-V.Plana Reconstruction and modernisation of the line Nis-Presevo- RW 15 Cor X SERRW022.9 SER U 156 77.3 TR Macedonian border TR 15 RW 17 Cor X Rail track overhaul Savski Marof-Zagreb section HRVRW028.1 HRV R 27 23.3
PS RW 25 Cor X Remote rail control traffic system Savski Marof-Zagreb-Tovarnik HRVRW027 HRV N 329 23.4
Route RW 19 Rehabilitation of Vrbnica-Podgorica-Bar railway line MONRW013 MCN R 167 25 TR No.4 Route NEW16 RW 8 Rehabilitation of Vrbnica-Podgorica-Bar/additional works MONRW012 MCN R 167 7 TR No.4 Danube riverbed restoration,5 sec:Apatin,Vernelj- 17 IW 5 Cor VII SERIW032-36 SER R 14 11.40 TR Petres,Staklar,Mohovo,Beska AP 14 Airport Functional improvement of airside at Belgrade Airport SERAP003 SER N 0 7.2 CD NEW18 AP 12 Airport Modernisation of Nis Airport SERAP066 SER U 0 4.2 CD 19 AP 20 Airport Split Airport: New Aircraft platform i.e.apron HRVAP002 HRV N 0 15 TR 20 AP 25 Airport Rehabilitation of Pristina Airport KOSAO001 KOS R 0 31.40 FS Sea 22 Transport and Trade Integration (TTI), Port Ploce HRVSP010 HRV N 0 86 FS Port Sea Port of Dubrovnik: Construction of international passenger 21 32 HRVSP011 HRV N 0 20 FS Port terminal Sea 22 33 Reconstruction of Volujica Quay, port of Bay MONSP011 MCN R 0 10.5 TR Port
Source: MAP 2007-2011 volume 1, page 58
118 ANNEX 5: DETAILS ON PARTNERSHIP CONSULTATIONS
MINUTES OF MEETING HELD ON 15 MARCH 2007 CONSULTATIONS WITH PARTNER INSTITUTIONS IN TRANSPORT SECTOR REGARDING TRANSPORT OPERATIONAL PROGRAMME
The Ministry of the Sea, Tourism, Transport and Development organised a presentation of the Transport Operational Programme on 6 March 2007 in the premises of the Ministry, Prisavlje 3, Zagreb.
The meeting was hosted by Mr. Mate Jurišić, Assistant Minister (MSTTD) as a representative of the Directorate for Strategic Infrastructure Projects, the head of the IPA Operating Structure for the transport sector. Along with Mr. Jurićić, parts of presentation were also held by Mr. Dalibor Dvorny, Expert Assistant from Central Office for Development Strategy and Coordination of EU Funds as the central coordination body for IPA programme in Croatia, and Ms. Zrinka Ivanović Kelemen from Croatian Railways Infrastructure as the main final beneficiary.
Invited to the meeting were the representatives of the following partner organisations:
Institute of Transport and Communications, Zagreb University of Zagreb, Faculty of Civil Engineering University of Zagreb, Faculty of Transport and Traffic Sciences Railwaymen Trade Union of Croatia Railroad Engineer Trade Union of Croatia Infrastructure Union of Croatian Railways Technical Inspection of the Rolling Stock Trade Union Croatian Railwaymen Trade Union Union of Croatian Train Dispatchers Agency for Inland Waterways
All of the invited partnership institutions sent their representatives to the meeting.
The scope of the meeting was to clearly present the multiple facets of the current version of the Transport OP, and moreover to explain to the partners their actual and future role in the programming process.
The presentation was divided in several parts; the introduction, an overview of the institutional setup for IPA, and a presentation of the actual project proposals. The hosts provided in-depth explanations concerning the Transport OP: IPA institutional setup, the institutions involved in drafting, the process of Inter-Ministerial Working Group approach, the hierarchy of consulted strategic documents, the OP template, priority axis, measures and finally project proposals.
The meeting then continued with a discussion of possible alternative project proposals as the partners suggested further projects related to investments in reconstruction and modernisation of rolling stock and investments in construction of distribution centres. After it was mutually understood that most of these ideas are not eligible for IPA co-financing the participants were satisfied with the explanation and therefore broadly supported the proposal for partial reconstruction of the railway line on the Corridor X, particularly the proposals regarding safety of the railway transport as the main priority.
The participants also expressed their support for similar future initiatives regarding project presentations.
Finally, the participants were given the possibility to submit, within a ten-day period, written remarks and proposals referring to the presented Operational Programme. Since no comments were received by the agreed closing date, we are of the opinion that the Operational Programme for Transport is fully endorsed.
Zagreb, on 15 March 2007 MINUTES OF MEETING HELD ON 13 JUNE 2007 CONSULTATIONS WITH ENVIRONMENT SECTOR REGARDING TRANSPORT OPERATIONAL PROGRAMME
The second consultation meeting with partners was held on June 13, 2007 at the premises of the Ministry of Sea, Tourism, Transport and Development, at Prisavlje 14, in Zagreb.
The meeting was attended by representatives of the press, radio and television, and by the representative of the environmentalist group GREEN ACTION (Friends of the Earth Croatia). Other NGO’s were also invited, but their representatives did not attend the consultations. The invitations were distributed through personal e-mails and through dedicated environment protection networks “The Green Forum” and Croatian Environment PRESS Centre. The representatives of the Ministry, Croatian Railways Infrastructure and CODEF (Central Office for Development Strategy and Coordination of EU Funds) informed the persons present about preparation of the Operational Program for Transport 2007-2009.
The following day, information on the preparation of the TOP was given in the press, radio and television. On June 21, the environmentalist group "Green Action - Friends of the Earth Croatia" sent a letter to the Ministry with general comments highlighting minor damage to environment that would occur from traffic flows being oriented towards railway and river transport routes. In addition, Green Action is of the opinion that an environmental impact study should be prepared and that protection measures should be determined for the proposed railway rehabilitation sections, principally as, on some segments of the sections proposed for rehabilitation, the railway route is to be relocated to allow for an increase in the horizontal curve radii. Improvement of the Sava River navigation capabilities is acceptable if the existing eco-system is preserved to the maximum level possible. Green Action considers that it would be ideal if no technical interventions are made to the Sava River bed. However, they are aware that this is impossible and hence they ask for maximum protection measures, and for implementation of all relevant national and international laws.
Green Action supports the Vukovar Port construction incentive, but emphasises that the port extension work should be carried out in keeping with relevant national and international laws to ensure that the environment will be affected as little as possible during the port construction and during its subsequent use.
120
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ENVIRONMENTAL OPERATIONAL PROGRAMME 2007-2009
INSTRUMENT FOR PRE-ACCESSION ASSISTANCE
2007HR16IPO003
September 2007
TABLE OF CONTENTS
GLOSSARY OF ABBREVIATIONS...... 4 1. CONTEXT, CONSULTATION AND COORDINATION ...... 8 1.1. NATIONAL POLICY AND SOCIO-ECONOMIC CONTEXT...... 8 1.1.1. Current situation ...... 8 1.1.2. Policy expectations in the short to medium term period ...... 11 1.1.3. National policy context for the Environmental Protection Operational Programme ...... 11 1.1.4. Institutional framework...... 14 1.1.5. Croatia’s legal framework...... 17 1.1.6. Horizontal Issues...... 19 1.1.7. Statistics ...... 19 1.2. COMMUNITY STRATEGIC FRAMEWORK...... 20 1.2.1. EU policy in relation to Croatia ...... 20 1.2.2. The EU's legal framework...... 22 1.2.3. Croatia’s progress towards acquis compliance & readiness for EU membership...... 23 1.2.4. Lessons learned from previous EU assistance...... 23 1.2.5. Concentration and coordination of assistance...... 23 1.3. PARTNERSHIP CONSULTATION...... 24 1.4. EX-ANTE EVALUATION...... 27 2. ASSESSMENT OF MEDIUM TERM NEEDS, OBJECTIVES AND STRATEGIC PRIORITIES...... 29 2.1. SOCIO-ECONOMIC ANALYSIS (including SWOT analysis)...... 29 2.1.1. Overview of the significant environmental factors ...... 29 2.1.2. Environmental sub-sectors...... 33 2.1.3. SWOT analysis...... 44 2.1.4. Medium term needs and objectives in the waste management sub-sector ...... 46 2.1.5. Medium term needs and objectives in the water management sub-sector...... 47 2.2. STRATEGIC PRIORITIES ...... 47 2.2.1. Waste management ...... 48 2.2.2. Water management...... 50 3. PROGRAMME STRATEGY...... 52 3.1. PRIORITY AXES AND MEASURES...... 52 3.1.1. IPA objectives and priorities axes...... 52 3.1.2. General Selection Criteria ...... 53 3.1.3. PRIORITY AXIS 1 – DEVELOPING WASTE MANAGEMENT INFRASTRUCTURE FOR ESTABLISHING AN INTEGRATED WASTE MANAGEMENT SYSTEM IN CROATIA ...... 54 3.1.4. PRIORITY AXIS 2 – PROTECTING CROATIA’S WATER RESOURCES THROUGH IMPROVED WATER SUPPLY AND INTEGRATED WASTE WATER MANAGEMENT SYSTEMS...... 59 3.2. PRIORITY AXIS 3 - TECHNICAL ASSISTANCE...... 67 3.3. HORIZONTAL ISSUES...... 70 3.3.1. Equal opportunities for men and women ...... 70 3.3.2. Environmental Protection and Sustainable Development...... 70 3.3.3. Participation of civil society and geographical, sectoral and thematic concentration...... 71 3.4. COMPLEMENTARITIES AND SYNERGIES WITH OTHER FORMS OF ASSISTANCE ...... 71 3.4.1. Complementarities and synergies with other SCF OP ...... 71 3.4.2. Complementarities and synergies with other IPA components...... 72 3.4.3. Complementarities and synergies with previous EU assistance and IFIs...... 74 3.5. INDICATIVE LIST OF MAJOR PROJECTS...... 80 4. INDICATIVE FINANCIAL TABLES FOR THE ENVIRONMENT OPERATIONAL PROGRAMME...... 89 5. IMPLEMENTATION PROVISIONS ...... 93 5.1. MANAGEMENT AND CONTROL STRUCTURES...... 93 2 5.1.1. Bodies and authorities...... 93 5.1.2. Separation of functions...... 99 5.2. MONITORING AND EVALUTION...... 100 5.2.1. Monitoring arrangements...... 100 5.2.2. Management Information System...... 101 5.2.3. Monitoring System and Indicators ...... 102 5.2.4. Selection of operations...... 102 5.2.5. Sectoral annual and final reports on implementation...... 103 5.2.6. Evaluation arrangements...... 103 5.3. INFORMATION AND PUBLICITY...... 104 5.3.1. Introduction...... 104 5.3.2. Requirements ...... 104 5.3.3. Activities ...... 105 5.3.4. Indicative budget ...... 105 5.3.5. Management and implementation ...... 105 5.3.6. Monitoring, evaluation and reporting ...... 106 5.3.7. Partnership and networking...... 106 5.3.8. Internet ...... 107 ANNEX I: MEMBERSHIP OF INTER-MINISTERIAL WORKING GROUP (IWG)...... 108 ANNEX II: MONITORING INDICATORS ...... 109 ANNEX III: INDICATIVE LIST OF PROJECTS AND THEIR IDENTIFICATION CARDS...... 112 ANNEX IV: DETAILS ON PARTNERSHIP CONSULTATION...... 140 ANNEX V: DIAGRAM OF THE EPOP INSTITUTIONAL STRUCTURE...... 146
3 GLOSSARY OF ABBREVIATIONS
AP Accession Partnership CARDS Community Assistance for Reconstruction, Development and Stabilization CBS Central Bureau of Statistics CEA Croatian Environment Agency CFCA Central Finance and Contracting Agency for EU Programmes and Projects CODEF Central Office for Development Strategy and Coordination of EU Funds CW Croatian Waters DABLAS Danube Black sea Task Force DISF Danube Investment Support Facility DG Directorate-General EBRD European Bank for Reconstruction and Development EC European Commission EEA European Environment Agency EEC Environmental Emission Cadastre EIA Environmental Impact Assessment EIB European Investment Bank EIRR Economic internal rate of return EPEEF The Environmental Protection And Energy Efficiency Fund EPOP Environmental Protection Operational Programme EU European Union EUR Euro EUROSTAT Statistical Office of the European Communities FIRR Financial internal rate of return FWA Framework Agreement GDP Gross Domestic Product GHG Greenhouse gas emissions IFI International financial institution IPA Instrument for Pre-Accession Assistance IPARD IPA Rural Development Programme ISPA Instrument for Structural Policies for Pre-Accession IWG Inter-ministerial working group MAFWM Ministry of Agriculture, Forestry and Water Management MBT Mechanical Biological treatment MEPPPC Ministry of Environmental Protection, Physical Planning and Construction MFAEI Ministry of Foreign Affairs and European Integration MFIN Ministry of finance MIFF Multi Annual Financial Framework MIPD Multi-Annual Indicative Planning Document NAO National Authorising Officer NES National Environmental Strategy NWMS National Water Management Strategy NEAP National Environmental Action Plan NIPAC National IPA Coordinator NGO Non-Governmental Organization NPIEU National Programm for the Integration of the Republic of Croatia into the European Union NPIS Nature Protection Information System NUTS French - nomenclature des unités territoriales statistiques - Nomenclature of Territorial Units for Statistics OG Official Gazette OP Operational Programme PA Priority axes P.E. Population equivalent PEP Pre-accession Economic Programme 4 PPP Purchasing Power Parity RBMP River Basin Management Plans REReP Regional Environmental Reconstruction Programme RES Renewable Energy Resources RCOP Regional Competitiveness Operational Programme RWMC Regional Waste Management Centre SAA Stabilization and Association Agreement SAPARD Special accession programme for agriculture and rural development SEA Strategic Environmental Assessment SCF Strategic Coherence Framework SDF Strategic Development Framework for 2006-2013 SINP State Institute for Nature Protection SWOT Strengths-Weaknesses-Opportunities-Threats TA Technical Assistance TS Transfer stations UNDP United Nations Development programme UWTD Urban Waste Water Treatment Directive TOP Operational Programme for Transport WB World Bank WFD Water Framework Directive WMC Waste Management Centre WMS Waste Management Strategy WWTP Waste Water Treatment plant
5 INTRODUCTION & SUMMARY
The Republic of Croatia proposes to use the European Commission’s (EC) Instrument for Pre-Accession (IPA) to co- finance an Environmental Operational Programme (EPOP) under IPA Component III - Regional Development. The EPOP will cover a rolling three-year period 2007-2009 and build on previous investments and capacity building initiatives funded by earlier EU programme such as CARDS, ISPA and Phare.
The Operational Programme presented sets out the all key issues with supporting information – context; policy; analysis; objective and strategy to meet the needs. It also provides the indicators to monitor and evaluate performance and management and to implement a system to ensure the delivery of the objectives.
The general state of environment in Croatia is relatively good compared to the situation in EU industrial countries, mainly due to the low detrimental impact of the heavy industries (due to their collapse in the 1990s), and the country benefits from a number of natural advantages and strengths such as: unique and relatively well preserved natural environment, high level of biodiversity, high stores of fresh water etc. The natural environment is a crucial asset in Croatia’s economic and social capital, and a driver of economic development, given its pivotal role in tourism in Croatia.
But on the other hand, the degree of environmental protection is lower than in other developed countries, primarily due to insufficient investment, and hence there are substantial investment needs across all environmental sectors, primarily in the heavy investment sub sectors of waste, water and air. These are mainly related to achieving the adequate provision of environmentally related services and standards regarding environmental protection, but also reaching a balance between a strong need for economic development and environmental protection, in other words, sustainable development, which is at the heart of the EU’s Lisbon and Gothenburg agendas. In order to focus Croatia’s actions, Croatia’s National Environment Strategy (2002) identifies 13 priorities, of which the top three are waste management, water management and air quality. The recent strong output growth in Croatia is placing increasing demands on the environment and its infrastructure. The ongoing fiscal consolidation means that public resources for modernising infrastructure must be carefully managed, which reinforces the importance of well-founded environmental strategies, and the prioritisation and sequencing of infrastructure investments.
The IPA policy framework for Components III and IV - Regional Development and Human Resources Development respectively, is the Strategic Coherence Framework (SCF), which sets out how IPA funding may be used in Croatia’s preparations for joining the European Union (EU) and is fully consistent with the EC’s Community Strategic Guidelines 2007-2013.
In addition to benefits related to preparation for membership - such as providing assistance for meeting acquis related obligations (“heavy investment directives”) and preparing to use the Structural Funds - activities under the EPOP will have a direct impact in terms of sustainable development and socio-economic benefits, through the promotion of employment, providing infrastructure for productive investments and raising the quality of life for residents.
The Environmental OP draws upon existing EU and national policies and strategies; the overarching policy document for preparation to join the EU is the Accession Partnership, which sets the short and medium term priorities, which are reviewed in the EC’s Annual Progress Report. Croatia has a well-developed hierarchy of environmental strategies, under the Strategic Development Framework 2006-13, particularly the National Environmental Strategy, National ISPA Strategy, various related sector strategies (energy, transport, planning etc), and strategies for environmental sub-sectors, including the Waste Management Strategy, and the Water Management Strategy (currently under parliamentary procedure).
The EPOP takes account of these strategies, while deriving its strategic objective from the SCF, namely:
“To protect and improve Croatia’s natural and living environment and environmental potential as a key element for future development, at the same time enhancing sustainability of energy systems especially by increasing energy efficiency and promoting renewable energy solutions.”
Since the priority set in the SCF is high-level, and hence very broad, the EPOP focuses on the objective to “To protect and improve Croatia’s natural and living environment and environmental potential as a key element for future 6 development” priority; the EPOP’s resources are limited, it cannot address all the issues that are encapsulated by the priority; therefore, and following national and EU strategic documents and related analyses, the EPOP has been designed to prepare Croatian institutions for EU accession and, following the principle of concentration, to make an impact upon the following priorities: 9 To develop waste management infrastructure for establishing an integrated waste management system in Croatia; and 9 To protect Croatia’s water resources through improved water supply and an integrated waste water management system.
Technical assistance for reinforcing administrative capacity for implementation of assistance delivered under the EPOP is an additional priority.
To achieve these priorities, the EPOP will invest in a series of “flagship” projects that will have significant environmental benefits. Those projects, in order to reflect the trajectory to the ERDF and Cohesion Fund, will be either of a large scale nature (above a 10m euro threshold) or smaller ones.
The expected impacts of the EPOP are two-fold: 9 Development benefits - assistance in the achievement of EU acquis related standards and economic and social benefits; and 9 Learning benefits - equipping Croatia with the institutional capacity to manage Structural Funds-type interventions; this capacity will give the institutions involved valuable experience in preparation for eventual EU membership and its associated responsibilities.
Therefore, it can be summarised that the operational objective of the programme, which will run for three years, is to:
“Improve access to, and the efficient delivery of environmental services and facilities in the waste and water sub-sectors”.
The Table below summarises the main elements of the Environmental Operational Programme and presents the ‘objective – priority axis – measure’ logic, which is central to the strategy.
ENVIRONMENTAL OBJECTIVES AND PRIORITIES FOR THE OPERATIONAL PROGRAMME National SCF EPOP Objective Priority Axes Meeting priority axes through investments to: environmental objective
Developing waste Establishment of new waste management management centres at county and regional levels infrastructure for and establishing an integrated Remediation of sites highly polluted by waste – waste management (hot spots) system in Croatia development development
sectors Establishment of modern water supply systems Protecting Croatia’s water and networks resources through
for future improved water supplies &
and living environment Construction of wastewater treatment plants for an integrated wastewater domestic and industrial wastewaters and Improve access to, and the efficient facilities in the waste and water sub- management systems Protect, and improve Croatia’s natural delivery of environmental services and upgrading the sewerage network environmental potential as a key element
The following sections of this document set out the context, analysis, objectives and strategy, while also identifying indicative projects, and proposals for managing and implementing the EPOP.
7 1. CONTEXT, CONSULTATION AND COORDINATION
1.1. NATIONAL POLICY AND SOCIO-ECONOMIC CONTEXT
This section reviews the key economic statistics and trends facing Croatia and their implications for national environmental policy. It then reviews the hierarchy of strategy documents which govern environmental policy in Croatia from the Strategic Development Framework (SDF)1 through the National Environmental Strategy and other relevant sector strategies, to the specific investment and sub-sector management strategies - the National ISPA Strategy, the Waste Management and Water Management Strategy. It then summarises the key public institutions tasked with developing and implementing these strategies. Finally, it describes the status of Croatia’s own legal framework.
1.1.1. Current situation2 Croatia is generally considered to be a functioning market economy, which should be able to cope with the competitive pressures and market forces within the European Union in the short to medium term.
Its macroeconomic position is characterised by stable growth, an improving fiscal stance, low inflation, a stable exchange rate and a declining unemployment rate. The current key macroeconomic challenges are present in the framework of high external vulnerability (due to a large current account deficit and a high level of foreign debt) and relatively slow structural reforms.
Since the mid 90s, Croatia has witnessed a steady growth of GDP and in the period 1995-2006 the average real GDP growth rate amounted to 4.4%. The real annual GDP growth rate reached 4.8% in 2006. In recent years output growth has been driven by growth in domestic demand, in particular by growth in investments and personal consumption. Investments in fixed capital grew during the period between 2001 and 2006 by an average rate of 11.1% reaching the share of investments in GDP of 29.8% in 2006. During the same period the average growth rate of personal consumption was 4.8%. Similar trends continued in 2006 which recorded a real growth rate for investments in fixed capital of 10.9%, while personal consumption increased by 3.5%. Looking at the structure of gross value added per economic sector in 2006, it can be observed that the highest contribution was given by the tertiary sector (68.1%), followed by secondary sector (24.5) and primary sector (7.4). In 2005, GDP per capita amounted to 7,037 EUR in current prices, enabling Croatia to reach around 49% of EU-25 average3 (in purchasing power standards). In 2006 GDP per capita amounted to 7,704 EUR. According to Eurostat first releases in 2006, Croatian GDP p.c. measured in PPP was close to 50% of the EU-27 average, but if we include estimations of grey economy, Croatia comes close to 60% of EU average.
The Government, since 2004, has put the fiscal deficit on a downward path, improved transparency and budgeting processes, and reduced quasi-fiscal activities. Fiscal performance is reflected in the respective net reduction of the fiscal deficit from 4.8% to 4.0% of GDP (GFS 1986) in 2004 and 2005, and 3% of GDP in 2006. Such performance is mainly based on a strong revenue growth caused by vigorous economic performance and the increased efficiency of the Tax Administration in the collection of taxes (especially with regard to value added tax, corporate profit tax and personal income tax).
Croatia has had low inflation rates since 1994. Since then, average annual consumer price inflation has amounted to 3.4%. It increased considerably from 2.1% in 2004 to 3.3% in 2005 and fell to 3.2% in 2006. The higher inflation rates were primarily caused by an increase in the price of crude oil on the world market (which had a negative effect on the growth of domestic and import prices), as well as by the rise in food and administrative prices (e.g. increased prices of water, waste removal and beverages due to a new recycling charge on packaging).
1 Adopted by the Government of the Republic of Croatia on 3 August 2006. 2 Statistical dana used in the document are those available in August 2007. 3 However, Croatian and EU statistics are not fully comparable since Croatia does not adjust GDP figures for the effects of the grey economy. Preliminary estimates of grey economy suggest that the official GDP figures should be adjusted which would bring Croatian GDP per capita expressed in PPP approximately to 52% of EU average in 2005.
8 The lasting track-record of low inflation is underpinned by the monetary policy determined by the Croatian National Bank whose primary objective has been low inflation. It is being supported by a stable exchange rate using a “managed float regime”. In the period between 2001-2006, fluctuations of the average monthly HRK/EUR exchange rate have not exceeded a narrow +/-4 % band. In the context of high “euroisation” within the Croatian financial system, the Croatian Central Bank is continuing to tightly manage the EUR/HRK exchange rate because it is the key instrument for curbing inflationary expectations in the country, and it also influences the stability of import prices from the euro-zone.
The unemployment rate, measured by ILO labour survey methodology, has continued its steady decline. In 2000 it amounted to 16.1% and kept falling to reach 12.7% in 2005. In 2006 it declined to 11.2 %. In 2005 the average net wage totalled 4.376 kunas (599,5 EUR) and in 2006 it increased to 4.603 kunas (630,5 EUR). The service sector is the leading area of job creation in Croatia.
Croatia is currently faced with challenges in the framework of external vulnerability. The Annual current account deficit rose from 5.1% of GDP in 2004, to 6.4% of GDP in 2005, increasing to 7.8% of GDP in 2006. Generally speaking the deficit was caused by lower growth of merchandise exports and increased growth of merchandise imports compared to the previous year and higher net factor payments to non-residents; while tourism revenues traditionally contributed to a surplus in services. Regarding foreign direct investment in Croatia, during 2006 Croatia received 2.7 billion EUR. Some of the largest FDI transactions took place in the last quarter of 2006 (e.g. initial public offering regarding 15% of INA stocks, recapitalisation of foreign owned banks). Overall inflow of FDI in Croatia since mid 1990 until the end of 2006 reached almost 14 billion EUR or 3,152 EUR per capita. A continual savings-investment gap led to high external debt which, at the end of 2006, amounted to 29.2 bln EUR; while the external debt to GDP ratio stood at 85.3%. In order to reduce external vulnerability and the external public debt, during last year the Government borrowed primarily through issuing bonds and treasury bills, or taking loans on the domestic market, thus, lowering its share in total external debt from 31.6% of GDP in 2004 to 22.8% in 2006. Consequently, the increase in the external debt was driven mostly by the external borrowing of other sectors (which include commercial banks and domestic enterprises).
Public debt is below the Maastricht criterion of 60%. General government debt amounted to 43.7% of nominal GDP at the end of 2005, while public sector debt (total general government debt without issued government guarantees) totalled 49.1% of GDP in nominal terms at the end of 2005. In 2006 these values fell to 40.8% of GDP and 46.4% of GDP respectively.
Regarding structural reforms, various positive steps can be noted, however, they have to be reinforced in order to further improve economic performance. This is why Croatian authorities introduced a series of measures: e.g. the introduction of e-Government – a service intended to speed up and improve communication between the Government, the business community and citizens; the expansion of hitro.hr (one-stop-shops) intended to reduce the time necessary to start up a company or a craft; the electronic registration of crafts, the electronic submission of specifications for payment of compulsory personal insurance contributions, access to all cadastral data and data from the land registry whose content has been adjusted with the cadastral data, as well as the electronic submission of VAT applications for commercial entities. Further positive examples include the establishment of entrepreneurial zones, a project focusing on streamlining and simplifying the legal framework connected with doing business in Croatia, as well as an incentive to decrease the tax burden of legal entities through a reduction of “hidden fees”. Furthermore, the reform of health-care financing is under way, as well as the reform of social welfare focused on the consolidation of various social benefits and the simplification and better targeting of the whole system. The banking sector is continuously growing. An agency for the supervision of the non-banking financial sector was established at the beginning of 2006. Further privatisation of the state oil company INA was performed through an initial public offering of 15% of all its stocks. Capital markets have recorded a strong growth – the equity index of Zagreb stock exchange CROBEX grew 60.7% during 2006. The merger of the Zagreb and Varaždin stock exchanges executed at the beginning of 2007 should result in further opportunities for the development of the non-banking sector within the financial system.
In spite of these positive trends, many serious issues still have to be tackled. Further improvement of the business climate cannot be achieved without continuous cutting of red-tape, streamlining and the vigorous modernisation of the state administration, the reform of the justice system which should contribute to the enforcement of market entry and exit, as well as the enforcement of creditor and property rights. The restructuring and privatisation efforts should be continued, particularly in the area of shipbuilding, as well as in the framework of the remaining state-owned tourism companies.
9 The international donor community, of which the EU is the most significant, is active in supporting environmental expenditure and investment in Croatia. This support bolsters Croatia’s own expenditure and investment, which amounts to around 0.3% of GDP (see table 1.1).
Investment needs, as well as the figures for expenditure and investments, differ considerably among countries. For example in 2002 (table 1.1.), Croatian public sector expenditure and investment fell between Lithuania (one-third of Croatian levels) and Austria (two-thirds) on the one hand, and Ireland (which spends and invests 0.5% of GDP) and Hungary (which spends more than double Croatian levels), all four of which are medium-sized EU countries, with populations ranging from 3.4m to 10.1m, and need to spend and invest significantly in the environment sector. Croatian public sector expenditure and investment amounts to around 57% of the EU 15 level. An estimate for ex Candidate Countries shows that those countries needed to spend on average between 2% and 3% of the GDP in the years that followed for full implementation of the environmental acquies. 4
The most recent data from the Croatian Central Bureau of Statistics estimates that total public and private business entity investment in environmental protection was around €197.4m (0.64% of GDP) in 2005, which is a considerable increase compared with €80.2 m in 2001 (0.36% of GDP). Table 1.1 Public Sector Environmental Expenditure and Investment (% GDP) Past and current environmental investments in Croatia are 2000 2001 2002 not sufficient although a significant improvement has been EU 25 0.56 0.58 0.53 made by investments from the Environmental Protection and EU 15 0.55(s) 0.58(s) 0.53(s) Denmark 1.28 1.24 1.2 Energy Efficiency Fund through co- financing the remediation Lithuania 0.10 0.09 0.10 / closure of municipal landfills starting from 2004. Hungary 0.5 0.58 0.66 In the Accession Partnership with the Republic of Croatia, the Austria 0.21 0.21 0.2 medium term priorities are to increase investments in Ireland 0.5 environmental infrastructure, with particular emphasis on Croatia 0.31 0.3 wastewater collection and treatment, drinking water supply Source: Eurostat and waste management and to develop an environmental investment strategy based on estimates of the costs of alignment.
It has been estimated that Croatia will need to invest around 7.94 billion euro, in the water and waste sectors alone, which represents a considerable investment needed to comply with the acquis. These investment figures are best estimates. However the recent 2002 CARDS project has produced considerably lower estimates of the investment required, particularly in the waste sector. The reason for this is the application of a different methodology.
In the water sub sector the CARDS 2003 project: ”Approximation of Water Management Legislation with EU Water Acquis” will produce: legal, institutional and financial assessments and recommendations for EU Water Directives; a Compliance Plan for the Wastewater Treatment Directive; and a draft Strategy and Action Plan for Approximation of EU Water Acquis. The project started in May 2006 and will last 18 months.
Within the project entitled "PHARE multi-country programme on Environment and Enlargement in 2005” (beneficiary countries: Bulgaria, Croatia, Romania and Turkey) a sub-project "Developing the capacity of environmental authorities through transfer of best practice and training to support the effective use of financial resources", launched by the EC in 2005, started in November 2006 and will continue through 2007. It is expected to contribute to the elaboration of a national Environmental Financing Strategy. The Strategy will focus on investments for the 3 main environment sub- sectors: water, waste and air quality which are to be financed by the public sector. The directives that would be covered refer to: bathing water, dangerous substances to water, drinking water, nitrates, sewage sludge, urban wastewater treatment (Water Framework Directive), hazardous waste, landfills, packaging waste, and large incineration plants (Air Quality Framework Directive). Preparation of the first draft of the document is planned in October 2007.
4 The estimate of the European Commission services; Communication from the Commission. The Challenge of the Environmental Financing in the Candidate Countries, COM (2001) 304 Final 10 1.1.2. Policy expectations in the short to medium term period The key challenges in the next three years which remain are tackling external vulnerability, structural reforms and further fiscal consolidation. This is especially important in the framework of the high costs connected with the accession process, whose exact measure and level remain to be defined precisely, as the negotiation process goes on and the exact requirements become better known and perceived.
According to the Pre-accession Economic Programme 2007–2009 and Economic and Fiscal Policy Guidelines 2008- 2010, adopted by the Government at the end of 2006 and mid 2007 respectively, the Government plans a set of policy measures aimed at reducing fiscal deficit, public debt and external debt as well as reinvigorating privatisation process. On the expenditure side, it will continue with the planned reform of the health insurance and social benefits and the planned reforms in the area of privatisation of large state-owned enterprises. . In order to develop domestic yield curve and to reduce external vulnerability, the Government will continue primarily borrowing on the domestic market. On the income side, it plans to step up the reforms in the process of tax collection in order to improve its efficiency. The foreseen structural reforms should result in the reduction of the general government expenditures according to GFS 1986 methodology (from 47,8% of GDP in 2006 to 43.1 % of GDP in 2010) as well as the reduction of general government deficit from 3.0 of GDP in 2006 to 0.5% of GDP in 2010. Furthermore, the reduction of public debt (sum of the general government debt and the guarantees) is projected from 46.4% of GDP in 2006 to 37.1% of GDP in 2010 (source: Economic and Fiscal Policy Guidelines 2008-2010). Monitoring of the International Monetary Fund will be limited to the Article IV consultations, which are to take place once a year, however, it is expected that the monitoring of the European Union will become more intense as the accession process goes on. The Government plans to establish policy credibility by moving forward with fiscal consolidation and necessary structural reforms, but of the outmost importance is creating a business-friendly environment that will turn investment interest into actual projects and create new jobs.
1.1.3. National policy context for the Environmental Protection Operational Programme The natural environment is a crucial asset in Croatia’s economic and social capital, it is one of the main drivers of economic development, given its pivotal role in tourism in Croatia. Croatia has a well-preserved environment mainly due to the absence of heavy industrial pollution over recent years; it is distinguished by a great biological and geographical diversity and it has relatively abundant fresh water supplies. However, the level of environmental protection is in general lower than in the EU.
As noted, Croatia has enjoyed strong output growth since the 1990s, which is partly the result of its highly attractive environment and the generation of tourism revenue, but it also reflects increased private consumption and investment. Paradoxically, this places increasing demands on Croatia’s environmental infrastructure, presenting a set of challenges that need to be managed efficiently and effectively. In particular, there is an increasing demand for high quality and reliable environmental services: water supply and the disposal of waste water, the management of solid waste, retaining a clean air environment and preserving the natural habitat. The ongoing fiscal consolidation and planned policy measures to reduce public debt mean that public resources for investment in modernising and maintaining infrastructure must be carefully managed to maximise effective spending and value for money. This emphasises the importance of well-founded environmental strategies, the prioritisation and sequencing of infrastructure projects, and maximising the contribution of IPA and other sources of funding.
Sustainable development offers to each country and at a global level, a positive long-term vision of a society that is more prosperous and more just, and which promises a cleaner, safer, healthier environment - a society which delivers a better quality of life for us, our children and future generations. Achieving this in practice requires that economic growth supports social progress and respects the environment. Environmental protection requirements must be integrated into all relevant sectoral policy areas (transport, energy, agriculture, tourism, etc.). This means that environmental protection should be an integral part of transport infrastructure development, as well as of energy, agriculture, and industrial development. Besides the preservation of the biological and geographical diversity, the Adriatic seacoast and islands and the corresponding municipal infrastructure, such as water supply, sewage and waste water treatment infrastructure and waste infrastructure, are preconditions for the long term development of tourism and overall development. The key facet of environmental protection is environmental management which is, in-turn, multi-faceted, covering a wide range of complex and interlinked sectors and activities – water and waste management, air pollution, natural habitat /nature
11 protection, biodiversity, noise, industrial pollution, and chemicals. Sustainable development is therefore integral to Croatia’s environmental policy and strategy framework. In the introduction to the National Environmental Strategy it is stated that the concept of sustainable development should become a predominant determinant of the development strategy of the Republic of Croatia which will enable to the future of environmental protection to be seen in a different way and in a much wider context than earlier.
The hierarchy of strategy documents that determine the national environmental policy framework in Croatia is as follows: 9 the overarching document is the Strategic Development Framework 2006-2013 (SDF); 9 the National Environmental Strategy (NES) and National Environmental Action Plan (NEAP); and 9 NES is subsequently supported by sub-sector strategies, such as the National Waste Management Strategy and the draft National Water Management Strategy, as well as the National ISPA Strategy for Environment.
The Strategic Development Framework 2006-2013 (SDF)5, adopted in August 2006, defines “growth and employment in a competitive market economy acting within a European welfare state of the 21st century” as Croatia’s strategic goal. Moreover, it defines the national development goals and identifies 10 strategic areas in which simultaneous and coordinated actions are required to achieve the specified development objectives. One of those areas is “Space, Nature, Environment and Regional Development”; moreover the preservation of the environment and balanced regional development are considered to be key elements of sustainable economic growth. Besides the SDF, Croatia’s basic development orientations have been defined in socio-economic development documents and sector strategies and plans. The sector strategies relevant to the environment sector are: 9 National Environmental Strategy (2002); 9 Physical Planning Strategy of the Republic of Croatia (1997); 9 Transport Development Strategy of the Republic of Croatia (1999); 9 Energy Development Strategy of the Republic of Croatia (2002); 9 Agriculture and Fishery Strategy (2002); and 9 Croatian Tourism Development Strategy for the Period up to 2010 (2003).
The National Environmental Strategy6 is the key document for the environment sector; it demonstrates that environmental pressures come from all economic sectors. However of particular importance are transport (user structure, infrastructure construction, fuel quality), energy (emissions, transfer, waste and use of fossil fuels), industry (emissions and wastewaters), tourism and partly agriculture (use of artificial fertilisers, pesticides). The environment and its loads and pressures not only affect the quality of life for residents, but equally also the attractiveness of Croatia as a tourist destination and its international perception as a country with a preserved environment and producing healthy food. Therefore, it is of wider importance that timely and effective solutions to the problems in the environment sector are found; improving the environmental infrastructure can solve the primary problems of waste management and water resources.
The NES has the following national long-term environmental objectives: 9 Conservation and improvement of water, sea, air and soil quality; 9 Conservation of the current state of biological diversity; 9 Preservation of natural resources, particularly the integrity and features of special natural assets (sea, coast and islands, mountain areas, etc.).
The main national strategic documents for the waste and water management sectors are the Waste Management Strategy (OG No. 130/2005) and the Water Management Strategy. The Waste Management Strategy was adopted in October 2005 and establishes the framework for waste reduction and sustainable waste management. The Water
5 Adopted by the Government of the Republic of Croatia; http://www.strategija.hr/Default.aspx?sec=122 6 Adopted by the Croatian Parliament on 25 January 2002 (Official Gazette of 25 April 2002 No 46/2002) 12 Management Strategy is currently under Parliamentary procedure and will provide the strategic framework for the sustainable use of water resources in the country.
The National Waste Management Strategy (2005)7 assesses the situation, identifies the problems and obstacles and sets the main waste management objectives for the period 2005-2025; these goals include: 9 Development of an integrated waste management system; 9 Establishment of county and regional waste management centres (up to 21); 9 Remediation and closure of existing landfills; 9 Remediation of sites highly polluted by waste – hot spots; and 9 Improved information and reporting systems for the waste management system.
The Waste Management Strategy regulates the management of different types of waste on the territory of the Republic of Croatia, from its generation to final disposal, with the basic aim of achieving and maintaining an integrated waste management system, which will be organised in line with contemporary European requirements and standards. The purpose of an integrated waste management system is to avoid to the maximum extent, (i.e., reduce) the generation of waste, to minimise the adverse impacts of waste on the environment, climate and human health, and to harmonise the entire waste management system with the principles of sustainable development.
The Waste Management Strategy will be implemented through a National Waste Management Implementation Plan,8 which was adopted on 19th July 2007 by the Government of the Republic of Croatia and will be valid for a period of 8 years. The relevant county’ waste management plans, which have been developed or are in the development stage will elaborate, in accordance with the National Plan, the individual project details and how they fit into the county / regional integrated waste management system.
The (draft) Water Management Strategy is the fundamental and national long-term strategic water management document for Croatia. It establishes a unified water management policy and an integral and coordinated approach to improving the water system in line with international commitments. It also defines strategic goals, establishes current and future needs and services, and identifies how they might be met through management plans for the 4 river basins in the country.
Other strategic documents and implementation plans have been adopted in 2007, or developed/under development, and will be completed and adopted in 2007; these include: 9 National Action Plan for the Protection and Improvement of Air Quality (draft prepared); 9 National Strategy and Action Plan meeting the obligations under the Framework Convention on Climate Change and the Kyoto Protocol (draft prepared); 9 State of the Environment Report for period 1997-2005 (adopted by Croatian Parliament on 25 May 2007); 9 Strategy on Sustainable Development (under development); 9 National Action Plan (NAP) for the Protection of the Mediterranean Sea against Pollution from Land-based Sources9; 9 National Water Protection Plan; 9 Proposals for implementing the Water Framework and Drinking Water (phase I) Directives; 9 Draft Implementation plan for the Urban Waste Water Treatment Directive (phase I); and 9 Draft Programme for the construction of urban wastewater sewerage systems and definition of the vulnerable areas (phase I).
7 Adopted by the Croatian Parliament on 14 October 2005 (Official Gazette of 2 November, No 130/2005) 8 Official Gazette of 16 August 2007, No 85/2007 9 Accepted by Interministerial Committee and UNEP/MAP. To be adopted by the Government of the Republic of Croatia by the end of 2007. 13 The National ISPA Strategy for Environment (2005)10, which is the first investment strategy for the country, identifies priority waste management, water supply, sewage and wastewater treatment investment projects; this was the basis for Croatia’s investment planning for the use of 30M€ allocated to the country under ISPA for the period 2005-2006 (more details in section 3.4.3.). These funds will make a limited contribution to meeting the full and substantial needs of Croatia in these policy areas. However, the indicative list of 26 projects in the National ISPA Strategy represent the priority investments for the water and waste management sectors, which will contribute to meeting the obligations of the heavy- investment directives within the EU environmental acquis. The list has been up-dated and the “long list” of projects for IPA investments, and their state of readiness is described in section 3.5 of this Programme.
All projects financed under the EPOP must fully respect compliance with sustainable development principles and meet relevant environmental norms, in particular directives on EIA, Habitats and Birds (in order to avoid negative impacts on potential NATURA 2000 sites) and the relevant environmental aquis. Investments in the environmental sector will be planned using integrated and strategic approaches, in particular in line with the basin approach and waste management planning. The projects to be financed must be appraised on a case by case basis in order to be coherent with the relevant obligations on the environmental aquis.
The following sub-section describes the key institutions in Croatia responsible for preparing and implementing these strategies, programmes and plans, at national, county and municipal levels.
1.1.4. Institutional framework On a general level, responsibility for environmental policy lies mainly with the following two ministries:
9 The Ministry for Environmental Protection, Physical Planning and Construction (MEPPPC) is the central government body responsible for environmental protection. It is, among other activities that fall within its competence, responsible for administrative and other affairs relating to general environmental protection policy, waste management; air protection, climate and ozone layer protection; environmental impact assessment; environmental contingency plans as well as sea and coastal zone protection and soil protection. It performs: co- ordination tasks, expert development and participates in the development of strategic documents; it carries out activities related to the process of EU integration in the environmental sector; environmental protection inspection; promotion of environmental education and research in connection with environmental protection.
9 The Ministry of Agriculture, Forestry and Water Management (MAWFM) performs administrative and other tasks related to the management of water and the water management system; monitoring and adapting water management development to the needs of economic development; regulation of watercourses, protection from adverse effects of water and ice and from erosion and flooding, land drainage and irrigation; management and use of the water estate; protection of water and sea from land-based pollution; securing water reserves; the use of hydropower; planning and harmonising the development and construction of public water supply and sewerage systems of a national interest, as well as performing inspection activities.
Other government bodies concerned with environmental protection are: the Ministry of Culture, the Ministry of the Sea, Tourism, Transport and Development; the Ministry of Health and Social Welfare; the Ministry of Economy, Labour and Entrepreneurship; the Protection and Rescue State Directorate; and the Meteorological and Hydrological Service. In addition, a State Institute for Nature Protection has been established and it carries out activities related to the preservation and improvement of nature protection. In addition there is the Croatian Environment Agency which has the task of gathering and providing environmental data, the Environmental Protection and Energy Efficiency Fund and the Croatian Waters agency for water management.
More specifically, waste management responsibilities in Croatia are divided between the following institutions:
9 The Croatian parliament and the Government of the Republic of Croatia are State Authority Bodies. The Parliament adopts the relevant legislation and national strategies, such as the Waste Management Strategy. A Parliamentary committee issues opinions on specific acts and documents. The Government adopts the waste
10 National ISPA Strategy was adopted in the course of 2005 by the ministerial collegiums of the Ministry of Environmental Protection, Physical Planning and Construction and Ministry of Agriculture, Forestry and Water Management i.e. institutions that have been in charge of the preparation of the Strategy. 14 management plan and implementing legislation (Regulations), proposes relevant legislation and strategies to Parliament and defines mandatory locations. The Government ensures the conditions and prescribes the measures for hazardous waste management and for the incineration of waste.
9 The Ministry of Environmental Protection, Physical Planning and Construction is a State Administration Body (ministries, State Administration offices in the counties). In the waste sector, it is responsible for: ¾ Preparing new primary legislation and standards; ¾ Preparing the National Waste Management Strategy and National Waste Management Implementation Plan; ¾ Preparing implementing legislation; ¾ Approving reports on the state of the environment and the environmental protection programmes; ¾ Approving activities(interventions) based on environmental impact assessments; ¾ Issuing permits for hazardous waste management and the incineration of waste; and concessions for specific waste category management (used tyres, packaging waste, waste oils etc.); ¾ Hazardous waste management (implementation of measures); ¾ Inspection and supervision and enforcement of laws and secondary legislation; ¾ Monitoring the Croatian Environment Agency and Environmental Protection and Energy Efficiency Fund.
9 The Environmental Protection and Energy Efficiency Fund (EPEEF), established in 2003 and operating since the beginning of 2004, is an extra-budgetary institution owned by the Republic of Croatia, the purpose of which is to finance environmental protection programmes and projects; this also includes energy efficiency and use of renewable energy sources. The EPEEF collects different environmental charges as its own revenue, which includes charges for burdening the environment with hazardous and non-hazardous industrial waste.
9 The Croatian Environment Agency (CEA) is a public institution established by the Government in 2002. The CEA primarily collects, processes and provides data required for the efficient implementation of the environmental protection policy. It performs tasks related to development and coordination of the environmental protection information system. It prepares the report on the state of the environment (reports on waste management are a component of that report), which is endorsed by the MEPPPC.
9 The Counties and the City of Zagreb are regional self-government units, which are responsible for managing all types of waste in their respective areas, issuing waste management plans for their respective areas; gathering and submitting data on waste (cadastre of emissions into the environment, etc.); the state administration offices in the counties issue permits for non-hazardous waste management.
9 Towns and municipalities are local self-government units that are responsible for managing municipal waste, preparing waste management plans and determining locations in spatial plans for their respective areas.
The Public Utility Services Act sets down that public utility services (which encompass municipal waste management) can be performed by: 9 Public utility companies established by local self-government units (local self-government units should own at least 51% of the company); 9 Public institutions established by local self-government units; 9 Organisational unit of local self-government units; 9 Legal and natural persons on the basis of a concession agreement; 9 Legal and natural persons on the basis of a contractual agreement.
Other stakeholders involved in waste management are companies registered and licensed for the collection and transport, recovery and/or disposal of waste, or for the management of special categories of waste, consulting firms, professional and non-governmental organisations.
15
Water management responsibilities in Croatia are divided between the following institutions: 9 The Croatian parliament and the Government of the Republic of Croatia are State Authority Bodies. The Parliament adopts the relevant legislation and national strategies, such as the Water Management Strategy. A Parliamentary committee issues opinions on specific acts and documents. The Government adopts the river basin district management plans and proposes relevant legislation and strategies to Parliament. 9 The Ministry of Agriculture, Forestry and Water Management is responsible for water policy in the Republic of Croatia. Under the Ministry of Agriculture, Forestry and Water Management (MAWFM) two directorates relevant to water management have been established: the Directorate for Water Management and the Directorate for Water Policy and International Projects. The Directorate for Water Policy and International Projects is responsible for affairs related to EU accession, and implementation of internationally funded projects in the water sector. 9 Croatian Water (CW) is a State Agency responsible for water management. The tasks performed by Croatian Water are, as follows: ¾ Preparation of the draft Water Management Strategy, draft river basin district plans and preparation and implementation of the water management plan; ¾ Preparation of terms of reference, concept solutions, studies and investment programmes and reviewing of designs; ¾ Regulation of watercourses and other water bodies and ensuring protection from the adverse effects of water - monitoring of the situation and the control of watercourses and other water bodies, organisation of protection from floods and ice, protection from erosion and torrents, the organisation of the construction, technical and economic maintenance of watercourses and water works; ¾ Management of ameliorative irrigation and drainage systems - organising their construction, maintenance and utilization; ¾ Water use - determining water resources, monitoring the status of water resources, adjustment of water use plans made by other legal entities and the monitoring of their implementation, and other measures for functional and rational water use; ¾ Water protection - monitoring and determining water quality, organising the implementation of the National Water Protection Plan, coordination of water protection plans of local administrative units and other plans for investment in water protection, and monitoring their implementation, measures for prevention and elimination of water pollution; ¾ Management of the public water estate; ¾ Keeping water-related documentation and managing the integrated water information system; ¾ Technical operations related to awarding concessions on water and public water estate; ¾ Supervision of the implementation of terms and conditions stipulated by water rights acts and concession agreements (water management supervision); ¾ Tasks related to the implementation of water management plans; ¾ Supervision of the construction of water works. CW’s responsibility covers the whole of Croatia through its five water management offices and 32 catchment areas. Croatian Water is accountable for their work to the competent Ministry, i.e. the Ministry of Agriculture, Forestry and Water Management.
At a local level, there are a relatively large number (143) of municipal companies responsible for public water supply in Croatia; similarly, public wastewater systems are managed by 130 public utility (municipal) companies, some of which are also responsible for water supply. The owners of these companies are local self-government units.
16 1.1.5. Croatia’s legal framework Croatian legislation relating to the EPOP’s priority sectors (waste and water)11 is: 9 The Environmental Protection Act (OG No. 82/94 and 128/99); 9 The Waste Act (OG No. 178/04 and 111/06); 9 The Water Act (OG No. 107/95 and 150/05); 9 The Water Management Financing Act (OG No. 107/95, 19/96, 88/98 and 150/05).
The existing Environmental Protection Act is partly aligned with the acquis; Final draft of the new “umbrella” law which will ensure further alignment was accepted by the Government of the Republic of Croatia on 13th September 2007 and submitted to the Croatian Parliament for the second reading and adoption. The New Environmental Protection Act will regulate all the horizontal issues that have not yet been addressed in the sectoral laws (including certain aspects of Environmental Impact Assessment (EIA), provisions related to Strategic Environmental Assessment (SEA), provisions on access to environmental information, and integrated pollution prevention and control). Secondary legislation to implement the primary legislation will be drafted to fully transpose the relevant EU legislation.
In November 2004, a new Waste Act (OG No. 178/04) was adopted which was amended in September 2006 (OG No. 111/06); it stipulates Croatia’s waste management objectives, which are: 9 Avoiding and reducing the generation of waste and reducing the hazardous properties of waste; 9 Waste recovery (recycling, reuse or through some other procedure that allows separating the raw materials, or use of waste for energy purposes); 9 Waste disposal in the prescribed manner; and 9 Remediation of the environment where polluted by waste.
The relevant provisions of Council Directive 75/442/EEC on waste, as amended by the Council Directive 91/156/EEC, Commission Decision 94/3/EC, Commission Decision 96/350/EC and Commission Decision 2000/532/EC have been transposed into the Waste Act. This Act also sets out the general legal framework for further approximation with EU legislation in the waste sector, which includes some secondary legislation that has already been adopted: 9 Regulation on types, categories and classification of 9 Ordinance on waste batteries and accumulators waste with a waste catalogue and hazardous waste management (OG No. 133/06) list (OG No. 50/05) 9 Ordinance on packaging and packaging waste (OG 9 Ordinance on end-of-life vehicles management (OG No. 97/05 and 115/07), No.136/06) 9 Decision on conditions for packages labelling (OG No. 9 Ordinance on waste management (OG No. 23/07) 155/05, 24/06 and 28/06) 9 Ordinance on waste tyres management (OG No. 9 Ordinance on the manner and procedures for the 40/2006) management of waste containing asbestos (OG No. 42/07) 9 Ordinance on register of legal and natural person 9 Ordinance on the manner and requirements for performing activities of intermediation in organising thermal processing of waste (OG No. 45/07) recovery and/or disposal of waste and legal and natural persons which export non-hazardous waste (OG No. 51/06) 9 Ordinance on the criteria, procedure and manner of 9 Ordinance on medical waste management (OG No. determining compensation to real estate owners and 72/07)
11 EPOP’s priorities are the waste and water sub-sectors due to the limited amount of funds available and the necessity for the concentration of assistance and being the two top priorities outlined in the National Environment Strategy (NES). Giving that air sub- sector is third NES’ priority, and along with water and waste makes the “heavy investment” environmental sub-sector, it might be considered for assistance in the next programming period. 17 local self-government units (OG No. 59/2006) 9 Regulation on control of shipments of waste (OG No. 9 Ordinance on waste electrical and electronic 69/06 and 17/07) equipment management (OG No. 74/07) 9 Ordinance on waste oil management (OG No. 124/06) 9 Ordinance on waste oil management (OG No. 124/06)
Further transposition of the relevant acquis for the waste sub-sector is planned, according to the NPIEU 2007, for completion in 2007 and 2008 with the adoption of secondary legislation according to the Waste Act. Other implementing legislation, adopted under the old Waste Act is still in place and partly valid; these include: 9 Regulation on the Requirements for Handling Hazardous Waste (OG No. 32/98); 9 Ordinance on Waste Management Requirements (OG No. 123/97 and 112/01); In addition, certain waste management aspects are regulated by other sectoral legislation and international agreements:
9 Environmental Protection Act (OG No. 82/94 and 9 Act on Ratification of United Nations Framework 128/99) Convention on Climate Change (OG - International 9 Act on Public Utilities (OG No. 26/03, 178/04) Treaties No. 2/96) 9 Act on Ratification of Basel Convention on the Control 9 Kyoto Protocol to the United Nations Framework of Trans-boundary Movements of Hazardous Waste Convention on Climate Change (OG - International and their Disposal (OG – International Treaties No. Treaties No. 5/07) 3/94) 9 Montreal Protocol on Substances that Deplete the 9 Air Protection Act (OG No. 178/04) Ozone Layer (OG – International Treaties No. 9 Regulation on Limit Values of Emission Pollutants 12/1993) from Stationary Sources into the Air (OG No. 21/2007) 9 Stockholm Convention on Persistent Organic 9 Act on Environmental Protection and Energy Pollutants (OG – International Treaties No. Efficiency Fund (OG No. 107/03) 11/2006) 9 Physical Planning Act (OG No. 30/94, 68/98, 35/99, 9 International Convention MAR POL 73/78, i.e. 61/00, 32/02 and 100/04) Protocol V which regulates waste disposal in ports 9 Maritime Act (OG No. 181/04) 9 Barcelona Convention (OG – International Treaties No. 12/1993 and 17/1998) 9 Maritime Domain and Ports Act (OG No. 158/03 and
141/06)
The primary legislation for water management consists of two acts: 9 The Water Act, (OG No. 107/95 and 150/05); and 9 The Water Management Financing Act, (OG Nos. 107/95, 19/96, 88/98 and 150/05).
The Croatian Parliament amended these in December 2005. They are now partially harmonised with the Water Framework Directive (2000/60/EC); further harmonisation is envisaged by the end of 2008.
In addition to these two acts, representing the fundamental legal framework, water management in the Republic of Croatia is regulated by approximately 40 subordinate acts. The existing legal framework for water management needs to be harmonised with the EU acquis; Relevant for this EPOP are:
9 Regulations on special requirements to be met by 9 Regulation on water classification legal persons carrying out waste water activities 9 Regulations on limit values of indices, hazardous and 9 Regulations on special requirements for carrying out other substances in waste water water supply activities 18 9 Regulations on the sanitary quality of drinking water 9 Decision on determining catchments areas 9 National water protection plan 9 Decision on the register of national waters 9 Regulations on the issuance of water rights acts 9 Decision on determining the boundaries of river basins 9 Regulations on the development of the water management master plan of the Republic of Croatia 9 Regulation on hazardous substances in water 9 Regulations on the establishment of sanitary water 9 Ordinance on water-related documentation source protection zones
Croatia has signed and ratified a number of international water management treaties, these include: 9 The Convention on the Protection and Use of Trans-boundary Waters and International Lakes (OG – International Treaties No. 4/96); 9 The Convention on Co-operation in the Protection and Sustainable Use of the Danube River (OG – International Treaties No. 2/96); and 9 The Framework Agreement on the Sava Catchment Area (OG – International Treaties No. 14/03).
There are also important bilateral agreements on water management co-operation signed with the Republic of Hungary, the Republic of Slovenia and the Republic of Bosnia and Herzegovina.
1.1.6. Horizontal Issues The general concept of 'sustainable development', which encompasses all the horizontal issues, is incorporated into all the OPs and each one describes how it will be integrated through specific measures. They are consistent with the EU sustainable development strategy and Croatia is committed to a continuous improvement of the quality and protection of its environment (including the creation of sustainable communities with the capacity to manage and use resources efficiently and to 'tap into' the ecological and social innovation potential of the economy). For Croatia, the priority is to meet EU environmental 'norms' and standards; therefore, the EPOP will co-finance environmental investment related projects. Other OPs will integrate environmental protection considerations into other investment projects, notably transport infrastructure. "Horizontal themes" are integrated directly into the EPOP because environmental protection is a core and inherent component of sustainable development. It describes specific measures that will address the environmental 'theme'. Specific indicators are identified in the EPOP and it describes how these 'themes' will be integrated in a systematic and targeted manner and how they will be monitored through reporting on the results achieved in respect of each 'theme', through specific indicators. Horizontal issues are further elaborated in section 3.3. 1.1.7. Statistics Waste management In the waste sector data used in the EPOP relies on several data sources: the Croatian Environment Agency – CEA (derived from Environmental Emission Register), Croatian expert institutions and firms, the Environmental Protection and Energy Efficiency Fund and the MEPPPC. The data presented for waste management is estimated because only a few cities/municipalities provide data on actually measured (weighted) quantities of waste. The quantification of municipal waste is primarily done by means of visual assessment. The data collection system in Croatia has to be improved in accordance with the already developed legal basis. This is one of the goals set in the National Environmental Strategy and National Waste Management Strategy.
Water management In the water sector the data used in the EPOP relies on several data sources: the National Water Management Strategy (2007), MAFWM, Croatian Water, the Croatian Central Bureau of Statistics (Statistical Yearbooks) and EUROSTAT. The data collection system in the water sub-sector in Croatia has also to be improved on the basis of the existing legal framework.
The environment sector and environmental policy correspond to the national level, rather than regions, and the data provided in the EPOP refers to the national level (NUTS I). 19 1.2. COMMUNITY STRATEGIC FRAMEWORK
This section considers the EU’s policy in terms of the environmental aspects of the Lisbon agenda and the Community Strategic Guidelines, and its relationship with Croatia through the Stabilisation & Association Agreement and the Accession Partnership. It then sets out the EU’s legal framework in terms of the various directives which Croatia is currently seeking to fully transpose before summarising Croatia’s own legal framework alignment with the acquis and readiness for accession.
It then describes how the proposed priorities of the EPOP are consistent with the principle of concentration and refers to the coordination of assistance. Finally, it gives an overview of envisaged environmental expenditures and investments.
1.2.1. EU policy in relation to Croatia The EU is committed to sustainable development, and its development policy, including the cohesion policy, is driven by the Lisbon Strategy (Economic Development Strategy) and the Lisbon Community Programme (Growth and Employment Agenda); these were revised following a mid-term review in 2004. In this context, the framework for the use of Structural and Cohesion Funds is provided in the Communication Cohesion Policy in Support of Growth and Jobs, Community Strategic Guidelines, 2007-201312, which sets “strengthening the synergy between environmental protection and growth” as one of the Community priorities (under Guideline A: Making Europe and its regions more attractive places to invest and work) for support under Cohesion policy and achievement of the Lisbon strategy goals.
The EU’s strategic objective for the next decade is to become the world's most competitive and dynamic knowledge based economy, capable of achieving sustainable economic growth with more and better quality jobs and higher social cohesion. Environmental protection/sustainable development is included among the four priority fields for raising the level of EU competitiveness, and in this area, the set targets are oriented towards reducing greenhouse gas impacts, the increased use of electricity from renewable sources, a reduction in road transport volumes, noise and pollution reduction, etc. In order to achieve the planned targets, major significance is attributed to all forms of technology that is more environmentally acceptable, as compared to the respective alternatives.
One of the EU objectives is that regions should become places more attractive for investment and business; therefore the future harmonisation programme (the cohesion programme) must strengthen the synergy between environmental protection and growth. In this regard, a high priority shall be given to the provision of environmental services; these include infrastructure for waste and waste water treatment, natural resource management, decontamination of polluted land to prepare it for new economic activities, and protection from certain environmental risks (through the promotion of natural resource management, better use of ICT technologies, focussed research, etc.). The promotion of investments also contributes to the Kyoto Protocol commitments, by increasing the contribution to environmental protection and growth and jobs.
The relationship between Croatia and the EU was first governed by the Stabilisation and Association Agreement (SAA)13, which was signed in October 2001, and came into force in February 2005. The SAA provides the legal framework for political dialogue, regional cooperation, economic relations and the use of Community financial assistance14.
The SAA states that: “many ecologically fragile areas of a high biodiversity value are being degraded due to unsuitable development or encroachment into protected areas”. It notes that the public does not seem to be concerned about existing or potential environmental problems and “civil society has so far had a minimal impact in field of environmental protection”. In the six years since the SAA highlighted these issues and the lack of resources to tackle them, the Croatian authorities have paid more attention to these issues by increasing public expenditure on the environment and strengthening relations with civil society. On an international scale, co-operation has improved, particularly with regard to water protection in the Danube and Black Sea regions - as this remains a priority.
12 Council Decision 2006/702/EC 13 Council and Commission Decision (2005/40/EC, Euratom) of 13 December 2004. 14 With regard to the contents of this Operational Programme, Croatia will ensure the proper implementation of the commitments specified in Title VI of the SAA in the area of competition policy, including State aid. 20 In April 2004, the Council of the European Union adopted the European Partnership with Croatia. In June 2004, following the Commission’s positive opinion on Croatia’s application for membership, the European Council ratified Croatia’s application to become a member of the EU, and formal accession negotiations began in October 2005. In February 2006, the European Partnership was updated (on the basis of the Commissions progress report on Croatia of 2005) to an Accession Partnership (AP)15 that reflected Croatia’s new status as a candidate for EU membership16.
The AP sets short-term and medium-term priorities for environmental protection.
Short-term priorities: 9 Continue to develop horizontal legislation, including that concerning environmental impact assessment and public participation. 9 Clearly define the responsibilities and strengthen the administrative and operational capacity at a national and regional level to ensure planning, including the preparation of financial strategies. 9 Urgently adopt and begin implementing a national waste management plan.
Medium-term priorities: 9 Ensure the integration of environmental protection requirements into the definition and implementation of other sectoral policies. Develop an environmental investment strategy based on estimates of the costs of alignment. Continue to implement horizontal legislation. 9 Continue work on the transposition of the EU acquis, with particular emphasis on: waste management, water quality, air quality, nature protection and integrated pollution prevention and control. Increase investment in environmental infrastructure, with particular emphasis on waste water collection and treatment, drinking water supply and waste management. 9 Ratify the Kyoto Protocol to the United Nations Framework Convention on Climate Change.
In accordance with the SAA and AP, a plan for the transposition of the acquis into Croatian legislation National Programme for the Integration of the Republic of Croatia into the European Union (NPIEU) has been prepared on an annual basis since 2003. Since 2004 the NPIEU describes the legal and institutional framework of the environment chapter, the priorities in legislative harmonisation for the given year, administrative measures and budgetary allocations for their efficient implementation. The NPIEU for 2007, including the Environment chapter, was developed in 2006 and adopted by the Croatian Government in January 2007.
Additionally, Croatia prepared the Pre-accession Economic Programme (PEP) for the period 2005-2007, which was followed by an updated PEP for 2006-2008, and PEP for 2007-200917, - with the objective to define the economic policies and reforms necessary for European Union accession. The latter provides a clear definition of the country’s mid- term economic policy, priorities and structural reforms planned for the three-year period. Its' Environment Chapter (part of the ‘structural reforms’ section of the document) includes legislative and “non-legislative” measures to be implemented, which will have an impact on State Budget expenditure.
Croatia has prepared a Strategic Coherence Framework (SCF)18 which sets out the “Protection and improvement of Croatia’s natural and living environment and environmental potential as a key element for future development” as one of five objectives that should be achieved through activities supported by IPA Components III and IV.
This is consistent with the European Commission’s Multi-annual Indicative Planning Document (MIPD)19 which follows the same three-year planning horizon as the EPOP, and states that “Components III and IV aim at supporting Croatia in policy development as well as preparation for the implementation and management of the Community’s
15 Council Decision 2006/145/EC 16 In the context of this Operational Programme note is to be taken of the COUNCIL DECISION of 20th February 2006 regarding the principles, priorities and conditions contained in the Accession Partnership with Croatia and repealing Decision 2004/648/EC which further specifies the necessary obligations concerning competition issues 17 Adopted by the Government of the Republic of Croatia on 30 November 2006. 18 Submitted to the Commission on 13 June 2007 and agreed in the letter REGIO/EMPL no. 6010 of 18 June 2007 19 Commission Decision C(2007)2566 adopted on 20 June 2007 21 cohesion policy, in particular regarding the European Regional Development Fund, the Cohesion Fund and the European Social Fund. In terms of pre-accession assistance under Components III and IV, priorities comprise acquis- related investment in environmental protection and European transport networks together with support to the productive sector, in particular to SMEs and to human capital formation. The main challenges in the environment sector are to improve the reliability of the water supply system, to ensure adequate treatment of wastewater in line with the EU standards, to improve waste management in order to avoid detrimental impacts on the environment and in the long term to prevent air pollution that may increase beyond the current level as a consequence of combustion processes and traffic increase.
The SCF and EPOP have also been prepared to be consistent with the Community Strategic Guidelines which set the “strengthening of the synergy between environmental protection and growth” as one of the Community priorities (under Guideline A: Making Europe and its regions more attractive places to invest and work in) for support under Cohesion policy and achievement of Lisbon strategy goals.
These frameworks and guidelines provide the context for the preparation of this OP – its analysis, strategy and proposed actions - along with the existing national policy and strategies on the environment, as described in Section 1.1.3.
1.2.2. The EU's legal framework The framework for the EU’s waste management policy is contained in the European Council Resolution on Waste Management Strategy (97/C76/01), which is based on the Waste Framework Directive (75/442/EEC) and other waste management legislation. There are three policy principles: waste prevention, recycling and reuse, and improving final disposal and monitoring. In the EU’s ‘Cohesion Policy to Support Growth and Jobs, Community Strategic Guidelines, 2007-2013’, Member States have agreed to maximise economic benefits and minimise costs by tackling environmental pollution at source. In the waste management sector, this implies focusing on waste prevention, recycling and biodegradation of waste that are cheaper and provide more jobs in comparison with landfill and incineration, the least favourable end-of-pipe solutions.
The most important Directives in the waste management sector are: 9 Directive 2006/12/EC on waste; 9 Waste Landfill Directive 1999/31/EC; 9 Hazardous Waste Directive 91/689/EEC with amendments by the Commission Directive 94/31/EC; 9 Sewage Sludge Directive 86/278/EEC; 9 Incineration of Waste Directive 2000/76/EC ; 9 Packaging Waste Directive 94/62/EC as amended by Directive 2005/20/EC, Directive 2004/12/EC, Regulation (EC) No 1882/2003.
The EU’s 6th Environmental Action Programme “Environment 2010: Our Future, Our Choice”20 adopted in 2001, sets initiatives on waste for the first decade of the 21st century. It identifies waste prevention and management as one of four top priorities, and its primary objective is to decouple waste generation from economic activity.
The EU’s water policy is based upon the Water Framework Directive (WFD), which seeks to impose an integrated water basin management regime in Europe. This is an overarching system designed to protect all waters and it sets clear objectives, so that a “good status” must be achieved for all European waters by 2015 and that water use will be sustainable throughout Europe. The most important Directives in the water management sector are: 9 Water Framework Directive (2000/60/EC); 9 Urban Waste Water Treatment (UWWT) Directive (91/271/EEC, 98/15/EC); and 9 Drinking Water Directive (80/778/EEC, 91/858/EEC, 90/656/EEC and 91/692/EEC).
20 Decision No 1600/2002/EC of the European Parliament and of the Council of 22 July 2002 22 1.2.3. Croatia’s progress towards acquis compliance & readiness for EU membership Croatia is negotiating EU membership. The results and developments of that process present extremely important guidance for future activities in any given sector. Developments with regard to acquis compliance and to the priorities set in the Accession Partnership are reviewed yearly through the European Commission’s regular Progress Reports.
The National Programme for Integration into the EU for 2007 (NPIEU 2007) was adopted in January 2007. Under the Programme, it is planned to adopt 46 legislative acts across the entire Environmental sector, including a new Environmental Protection Act on the basis of which a series of implementing legislation will be further developed and adopted. In the waste management sub-sector, a series of implementing legislation, which will regulate different waste streams, are planned for adoption in 2007 with a view to achieving full transposition in 2008. As planned within NPIEU 2007, Croatia ratified the Kyoto Protocol in April 2007 and will also adopt further legislation in the air sector aligned with the acquis. It is intended to achieve full transposition of the environmental acquis by the end of 2008. NPIEU 2007 envisages a number of non-legislative measures, which includes an increase of the number of employees in state level institutions within the environment sector.
1.2.4. Lessons learned from previous EU assistance Based on the experience in project implementation and the utilisation of EU funds, the following is an outline of the main issues relevant for the future implementation of pre-accession assistance:
9 Croatian programme and project management capacity is evolving; practical experience gained so far needs to grow and become embedded in future EU funds management. So far the insufficiently developed institutional capacity at a national and sub-national level has proven to be the greatest obstacle for project implementation. Therefore the improvement of technical assistance and capacity building at all administrative levels must be secured; 9 It is essential to have skilled and motivated staff and further efforts are needed to identify, train, develop and retain a body of such staff; 9 An inadequate and unprepared project pipeline is an obstacle to the utilisation of assistance. Therefore the preparation of a sufficient number of well designed and mature projects (in particular regarding project design and tender documentation) is paramount to ensure the use of EU assistance in a timely and technically acceptable manner. This issue is directly linked with the need for strengthening the capacity at all levels, but particularly of the final beneficiaries in order to prepare good project/tender documentation in a timely manner; 9 It is necessary to improve time management and quality assurance in all institutions, as well as to improve implementation capacity (tendering and contracting); 9 The importance of coordination between stakeholders. This requires extensive and clear information flows with a focus on a common understanding of tasks, timeframes and interdependencies; 9 The necessity for access to and the dissemination of information in timely manner (to all interested parties) and greater emphasis on publicity measures (both EU assistance and sectoral co-ordination in general).
1.2.5. Concentration and coordination of assistance As previously highlighted, the overall aim of assistance provided through Strategic Coherence Framework is to ensure that the relevant institutions of the Republic of Croatia develop institutional capacity and gain practical experience with the management of Structural Funds-type interventions, thereby achieving readiness for eventual EU membership. IPA is seen as a bridge to eventual Structural Funds management; it is a tool, or mechanism, that will develop institutional capacity through the experience of programming and implementing Components III and IV (in the case of EPOP). Additionally it is proposed that IPA Components III and IV should have the same Operating Structure as for the Structural Funds.
The SCF and its OPs seek to strike a balance between maximising the learning benefits for Croatia’s institutions and concentrating activity in order to maximise impact, based on the finite resources of IPA. In that sense, the concentration of learning benefits is to be assured having in mind the limited resources available i.e. assistance must be used to provide as much experience as possible for the relevant institutions. The main tool through which this kind of concentration is to be assured is the possibility to propose not just large scale projects, but also those of a smaller size. 23 This will enable the relevant institutions to gain experience and prepare themselves, in terms of institutional / administrative / management capacity, for the Cohesion Fund (large scale projects) and Structural Funds (through small scale projects).
Secondly, concentration is to be secured on a sector basis. As described in section 1.1., environmental policy covers a wide range of issues with the heavy investment sub-sectors of waste, water and air being of particular interest. Due to the limited amount of funds available and the necessity to prioritise needs to achieve the maximum impact possible, the resources under the OP will be concentrated on two sub-sectors: 9 waste management; 9 water management (including both drinking and waste water).
In addition, geographical concentration will be secured at the water management sub-sector level. Since the greatest problems with water quality standards are in the Black Sea / Danube basin, and having in mind that water projects within the Adriatic River Basins are already the subject of assistance (“The Coastal Cities Pollution Control Project”, financed by the IBRD, with the aim of improving the quality of recipient waters and providing better water services in the Adriatic basins, by upgrading sewerage and wastewater treatment systems), the majority of proposed projects are designed to improve the sewerage and wastewater treatment systems in the Black Sea / Danube basin. However, the project for water infrastructure improvement in the towns of Knin and Drnis, presented in the EPOP’s Indicative list of major projects, refers to the inland part of the Adriatic River Basin21.
Activities related to the remediation of sites highly polluted by waste (hot spots) will be mainly concentrated in the Karst area, as ground water provides 90% of drinking water supplies in this area.
Concentration under each priority axis and measure, through setting up the relevant selection criteria, is set out in Section 3.
Overall coordination of the IPA programme in Croatia rests with the Central Government Office for Development Strategy and Coordination of EU Funds (CODEF). That part of CODEF’s mandate will ensure that the interventions financed under IPA are deeply embedded into the national development policies, ensuring strategic focus and added value of EU assistance. CODEF is also charged with coordinating the negotiations on Regional Policy and the Coordination of Structural Instruments.22
1.3. PARTNERSHIP CONSULTATION23 Activities commenced under the ISPA programme are to be continued within the IPA programme. Valuable experience was gained during the process of developing the National Environmental ISPA Strategy: contacts and meetings were held particularly with representatives of regional self government units regarding general information on the ISPA programme, its objectives and priorities, project eligibility and selection, preparation of projects and also the upcoming new programming period within the framework of IPA.
The EPOP has been prepared by an Inter-Ministerial Working Group (IWG) comprising representatives of the relevant state institutions and chaired by the Strategic Coordinator for Components III & IV. The membership is shown in Annex I; the programme of IWG meetings during 2006 was: 23 February; 21 April; 7 June. It has to be mentioned that permanent and intensive consultations were held among the members of the IWG during the first quarter of 2007
With regard to the projects presented in the EPOP’s Indicative list, consultations were held with various partners: within the CARDS 2002 project, drafts of two Feasibility Studies for Regional waste management centres ‘’Lećevica’’ in Split- Dalmatia County, and ‘’Badovinje rupe’’ in Dubrovnik-Neretva County were presented during workshops held in Split on 7-8th
21 The reason for inclusion of the respective project is twofold: firstly the CCPCP project financed by the IBRD is focused on the coastline and island areas (parts of the Adriatic basins), whereas the Knin and Drniš project is located in the inland part of the Adriatic basin. Secondly this project is particularly significant due to the fact that is located in a sensitive area as defined in the draft Water Management Strategy (it will restore the quality of the Čikola and Krka rivers which run through the “Krka” National park 22 Government decision of April 2006, OG 46/2006. 23 Public consultation process will have to be re-conducted if Environmental Protection Operational Programme will become subject of official revision(s). 24 November, 2006, and in Dubrovnik on 9th November, 2006. Two workshops were held in the presence of representatives of the Delegation of European Commission, MEPPPC, representatives of county authorities, towns and municipalities, waste management companies, NGOs and media from each of the counties. The workshops aimed to explain the proposals for the organisation and set up of regional waste management centres, legislation and planning assumptions, technical solutions, results of a social survey regarding affordability and the willingness to pay, results of financial, economic analyses and proposals for new tariffs. The workshops purpose was, among other things, to obtain support from municipal authorities and involve various stakeholders including civil society.
MEPPPC’s Minister and State Secretary along with the County officials presented the project entitled “Regional Waste Management Centre for Split-Dalmatia County “ on 1st December 2006 in the municipality of Lećevica – the site of the future Centre. It was emphasised that the location of the future centre was carefully chosen from an environmental point of view, based on sound expertise and research work.
Also, MEPPPC held a formal meeting on 27th February 2007 with representatives and officials of the County of Primorje- Gorski Kotar (representative of the County Prefect Office, the County Institute for Sustainable Development and Physical Planning and the “Ekoplus”) municipal company, with regard to the preparation of the project entitled “Regional Waste Management Centre Marišćina”. Meetings with representatives of Istria County regarding the project entitled “Regional Waste Management Centre for the County of Istria” were also held in course of 2007. These two projects, along with the projects “Regional Waste Management Centre for the County of Split –Dalmatia” have been prepared for the 2007 -2009 IPA programming period (see the EPOP’s indicative list of projects). The development of this EPOP was parallel to the development of the National Waste Management Implementation Plan, which is the main planning document for the up-coming establishment of new waste management centres at county/regional levels, which is the prime measure under the EPOP’s Priority axis 1. While defining the scope and other features of the new waste management centres, cooperation with the countiy’ authorities and experts was essential and constant, while joint consultation with county representatives took place on 11th April 2007 in Zagreb with a public presentation of the draft National Waste Management Implementation Plan by MEPPPC’s Minister and State Secretary. With regard to the location of future waste management centres, this is subject to the county physical plans which have to undergo a public hearing procedure before adoption. The National Waste Management Implementation plan accepts only those locations for new waste management centres which are determined by county physical plans. Further, consultations on the National Waste Management Implementation Plan were held on 16th May 2007 in Zagreb, with the participation of county representatives, during which IPA funding possibilities were also presented. Additionally, the draft National Waste Management Implementation Plan, along with the proposed Environmental Protection Act and Building and Physical Planning Act were presented during June 2007 in Primorje-Gorski Kotar County, Koprivnica-Krizevci County, Medjimurje County and Istria County, and during in July those documents were presented in Split-Dalmatia County, Dubrovnik-Neretva County and Virovitica-Podravina County. Subsequently, the National Waste Management Implementation Plan was adopted by the Government of the Republic of Croatia on 19th July 2007. Activities related to partnership consultations in the framework of the IPA programme for the water sub-sector, i.e. related to the projects on the EPOP Indicative list, were conducted by means of field trips and a series of discussions of the Ministry of Agriculture, Forestry and Water Management and Croatian Waters with the representatives of local self government, counties and municipal companies for the projects nominated for implementation within this programme.
On 21st March 2007, the Ministry of Agriculture, Forestry and Water Management organised a presentation of the IPA programme and of this OP to identified partners: the Croatian County Association, the Society of Town and Municipality Associations of the Republic of Croatia; the Croatian Chamber of Commerce, the Croatian Water Supply and Sewerage Communal Companies Group; civil society representatives (NGOs “Zelena akcija”, “Sunce” and “Zeleni Osijek”). The presentation focused on the water management section of the EPOP and it took place at the Head Office of Croatian Waters, Ulica grada Vukovara 220, Zagreb. It was attended by some of the partners. Since the Croatian Water Supply and Sewerage Communal Companies Group did not attend the meeting held on 21st March, a separate meeting and presentation of this Operational Programme for the Group’s members was held on 31st May 2007. Prior to this meeting, MAFWM had sent the second Draft of the OP to the Group. Around 40 representatives of utility companies attended the meeting. Comments and questions raised by the Group’s members referred to the project selection criteria and rationale for focusing on the Danube and Sava river basin projects. Subsequently, comments and questions were of such a nature that no changes or modifications were made to the OP. Annex IV contains the minutes of the meetings held on 21st March and 31st May 2007. 25 Following the first meeting held on 21st March, and upon the request of the partners present at the meeting, MAFWM and MEPPPC agreed (by an exchange of letters) to send the second draft of the OP to the following partners: Croatian Water Supply and Sewerage Communal Companies Group (as mentioned above), Croatian County Association, Society of Town and Municipality Associations of the Republic of Croatia, Croatian Chamber of Commerce; and to the representatives of civil society: NGOs “Zelena akcija”, “Sunce” and “Zeleni Osijek”. The letter (with the second draft of the OP is attached) inviting partners to provide comments on the EPOP, was sent by MAFWM on May 10, 2007. The response received approved the EPOP. The NGOs that received the second draft of the OP did not have any additional comments. During 4th Croatian Conference on Water with International Participation, which took place in Opatija, May 17-19, 2007, a Round Table meeting entitled "Croatian Water and the European Union – Challenges and Possibilities" was organised where the Ministry of Agriculture, Forestry and Water Management and Croatian Waters presented the second draft of this OP to the delegates of Croatian Chamber of Professional Engineer’s. The comments and questions that arose at that meeting also did not necessitate any modifications to the OP text. The Ministry of Agriculture, Forestry and Water Management also organised, in particular, consultations regarding this OP with the first three nominated potential final beneficiaries identified as priorities in terms of infrastructure construction in the water sector, i.e. the proposed Slavonski Brod, Osijek and Knin and Drniš Projects. A meeting took place in the Head Office of Croatian Waters, Ulica grada Vukovara 220, Zagreb, on April 4, 2007. Participants were informed about the activities which should be undertaken for the preparation of Applications and which should lead to the implementation of these nominated projects using IPA funds. The 3rd draft of the EPOP was sent by the MEPPPC on 14th June 2007 to the NGOs “Zelena Istra” (Istria County), “Ekokvarner” (Primorje-Gorski Kotar County) and “Sunce” (Split-Dalmatia County) which are operating in the counties where proposed three WMCs are located. The NGOs were invited to provide comments to the draft and subsequently to attend a meeting to further discuss it. The meeting was held on 28th June 2007 in the MEPPPC premises, with the participation of representatives of “Zelena Istra” and “Sunce”, whereas Ekokvarner did not attend the meeting, nor did it provide any written comments to the EPOP. The NGO's comments and questions mainly focused on the projects from their respective counties. The NGO “Sunce” is of the opinion that in general WMCs are priority projects which will contribute to improving the situation regarding waste management, and is well aware of the activities regarding the establishment of a waste management centre (WMC) in the county of Split-Dalmatia. Nevertheless, they recommended conducting independent expert research to prove the acceptability of the chosen Lecevica site having in mind that it is in a karst area where the risk of pollution of the ground water exists [note by MEPPPC: independent expert research has already been conducted by the Croatian Geological Survey (Final Conclusion – September 2006). The research concluded that location of the future “Lećevica” WMC is situated in the class IV water protection zone of the river Jadro and there are no legal obstacles for the construction of the Centre in that zone. The EIA Commission accepted this research and also stated that the waste treatment technology that is going to be used in the Centre will prevent any pollution of the groundwater]. NGO “Sunce” as well pointed out that would be desirable to increase the transparency of the selection process for WMC locations in general. The “Zelena Istra” representative expressed concerns whether the establishment of the Kaštijun WMC will guarantee the introduction of an integrated waste management system in the County of Istria. “Zelena Istra's” opinion is that planning to finance just the infrastructure of the Kaštijun WMC through the EPOP is not an integral solution. The EPOP should include also planning the establishment of recycling yards throughout the whole County, education, capacity building, etc. So far, „Zelena Istra“ has stated, that the public information and participation activities at County level regarding the future Kastijun WMC have been insufficient. “Zelena Istra” also asked for details regarding the timing of the EIA public hearing procedure for Kastijun, expressing its interest to participate in it and hoped that the summer holidays will not affect any (proper) public response to it. Both “Zelena Istra” and “Sunce” suggested to the MEPPPC to provide comprehensive information to the general public about the WMCs in general, including the technology that will be used, i.e. to explain to the public that these will be modern facilities that will not have a negative impact on neighbouring areas. They also stressed the importance of awareness raising and education activities, suggesting the inclusion of them within the Operational Programme.
26 1.4. EX-ANTE EVALUATION An ex-ante evaluation of the second draft of this OP was undertaken by an independent evaluation team during March and April 200724. The evaluation comprised desk research and a series of meetings and interviews undertaken by both international and local evaluators. The summary conclusions of the evaluation are as follows:
“The OP is well – structured, closely following the Commissions template for IPA OPs. It covers all the relevant issues, and is written in clear, comprehensible English. The OP includes a generally good analysis which provides a sound justification for the strategy, although additional information is required in some areas. The hierarchy of objectives, priorities and measures is logical and coherent with internal policies and EU policy objectives. Information is provided on the implementation and monitoring arrangements (although both require additional detail), as well as financial tables and an indicative list of major projects. In terms of environmental assessment, the OP clearly sets the context for the interventions, justifies the proposed interventions and has a high level of “environmental integration” and continuity.
It is worth noting that readability of the OP could be improved with some reorganization and editing of the text of the document, and there are some aspects of each section that could be improved. It is important that the relationship of the SWOT to the socio-economic analysis should be reviewed, to ensure that each of the issues listed in the SWOT is supported by the data/information in the analysis section. The multiple sets of “selection criteria” under some of the measures are confusing and could be misleading. The structure of monitoring indicators is still under development and no detailed appraisal of its validity has been possible. Some further attention could be given to specifying and measuring environmental impact at programme level. Consultations during the programme development phase were largely limited to discussions among members of the Inter-Ministerial working group. Implementation arrangements are still being developed, although the main organizational responsibilities are described. Consequently, further information is required on the division of responsibilities.”
Appraisal of the characteristics and effectiveness of environmental integration of the EPOP has been conducted (see Chapter 9 of the Ex-Ante Evaluation report) in accordance with the principle of Strategic environmental assessment in particular the information requirements as conveyed in Annex I of EU Directive 2991/42/EC on the assessment of the effects of certain plans and programmes on the environment with environmental integration being measured through the following terms: perception of environment, coherence with environmental policy and legislation, inclusion and application data, programme environmental impact and consultation process.
The result of the assessments presented in the Ex-ante evaluation report is the following: “The Environmental OP clearly sets the context for its interventions, providing substantial and relevant information and drawing this material into a comprehensive SWOT analysis. The selection of priorities is justified and continues the logical concentration on issues identified in previous strategies and environmental initiatives. The level of environmental integration is very high, with environmental factors placed in a socio-economic context. Continuity of environment is excellent, through well-reasoned objectives, priorities, measures and indicative projects. Competent authorities will assess environmental impact at project level; however, at programme level, further attention could be given to specifying and measuring environmental impact, with benefits for the monitoring process. Scope exists for greater interaction between the Environmental OP information and activities and other OPs in IPA Components III and IV.”
The evaluators provided detailed recommendations for the improvement of the OP which were generally balanced and constructive and are taken into account in this version of the Operational Programme:
• The text was reorganised and improved in some parts like suggested which contributed to final text being more coherent and readable; • The general review of environmental issues in Croatia was further developed; the text describing the situation in the waste sub-sector was improved so that it now provides more relevant data; • The relationship between the information provided under the socio-economic analysis and the points highlighted in the SWOT analysis was strengthened;
24 Process of the Ex-Ante Evaluation will have to be re-conducted if the Environmental Protection Operational Programme will become subject of official revision(s). 27 • The selection criteria set were re-examined and revised in order to be more coherent and clear and with the accent being placed on the maturity of the projects; • The indicators (at both at Operational Programme and Priority axes levels) were not apprised in detail (in the ex-ante evaluation) due to the fact that at the moment the ex-ante evaluation was carried out they hadn’t been development sufficiently. However, the indicators were re-examined and slightly modified in order to achieve a higher level of relevance and quality. Additionally indicator values and data sources were determined; • The suggested measuring of the environmental impact (impact indicators on the programme level) was appraised as very difficult due to the limited scale of the Programme; • The public consultation process was mainly carried out in the period following the ex-ante evaluation, and more detailed information is provided.
A copy of the full ex-ante evaluation report is attached to the Operational Programme (Annex VI).
28 2. ASSESSMENT OF MEDIUM TERM NEEDS, OBJECTIVES AND STRATEGIC PRIORITIES
2.1. SOCIO-ECONOMIC ANALYSIS (including SWOT analysis) 2.1.1. Overview of the significant environmental factors The Republic of Croatia is a Central European and a Mediterranean country located between the Danube river basin in the north and the Adriatic Sea to the south. Its total surface area is 87,661 km2, of which the mainland covers 56,594 km2, whereas coastal waters account for the remaining 31,067 km2. The country is divided by two marine catchments areas, the Black Sea and the Adriatic Sea, each with two river basins: the Sava, Drava and Danube feed the Black Sea, and the Primorsko-Istrian and Dalmatian drain into the Adriatic. The adjacent map shows the varied biodiversity in the country and its close link to water habitats. It’s geophysical location in Europe determines the environmental characteristics of the country, with the long coastal region, littoral highlands and the central plains. However, the dominant geological factor, the karst region, determines the most significant environmental issues in the country. Croatia's karst region is a unique relief with special hydrogeological and geomorphological features where ground waters are much more abundant than surface water. The surface watersheds substantially differ from the underground ones and in which characteristic surface forms (limestone cracks, sink-holes, karst valleys, subsidence valleys, etc.) and underground forms (caves and pits) occur in tectonically fragmented, carbonate, evaporite or gypsum rocks. Picture 2.1 Biodiversity & water habitats 25 Source: Draft Water Management Strategy The karst area occupies about 54% of Croatia's territory and it attracts the majority of tourists, thus contributing significantly to GDP. Today, this region’s highlands area boasts four national parks: Risnjak, North Velebit, Plitvice Lakes, Paklenica; and the Nature Park Velebit (smaller parts of karstic area are also included in Nature Parks Medvednica, Papuk and Žumberak-Samoborsko gorje), the coastal karst area also boasts four national parks: Brijuni archipelago, Kornati archipelago, Krka, Mljet and five nature parks: Ucka, Telascica, Vransko lake, Biokovo and Lastovo. The Velebit Mountain Range has been part of the UNESCO international biosphere reserves network since 1977 and is listed among the ten most important forest areas in the Mediterranean Region in the World Wildlife Fund's "Gift to Earth" programme. The Plitvice Lakes National Park has been on the UNESCO World List of Natural and Cultural Heritage since 1979. These internationally recognised sites and the whole of the karst region are a crucial part of Croatia's economic capital and must require specific care with the view to natural resource protection and sustainable development.
25 Source: „An overview of the state of biological and landscape diversity of Croatia, with the protection strategy and action plan“, Zagreb, 2000 29 Croatia is in the process of establishing the Natura 2000 network. The country has a considerable wealth and diversity of flora, mycoflora and fauna. It has 65 diverse habitats, which are home to significant26 numbers of strictly protected and protected species; Croatian protected areas cover a land area of a total of 5,379.41 km2 or cca 9.5% (compared to the EU-15 level of 12.4% in 2004). The major part of this area is protected as nature and national parks. Economic development will continue to exert pressure on the natural resources and biological diversity; and these protected areas need to be safeguarded.
The coastal water on the Croatian side of the Adriatic is of a high quality; moderately polluted are certain semi-enclosed coastal areas. So far between 6,000 and 7,000 of plant and animal species have been recorded in the Adriatic Sea. Pollution of the sea with dangerous substances is below the respective values. The sanitary quality of the sea water on beaches is high, in 2006, 98.94% of samples complied with the prescribed criteria.
Local soil pollution is present in areas of intensive industrial activity, inadequate landfills, mining, military activity or various incidents. Pollution of the soil by heavy metals, polychlorinated biphenyls and petrochemicals are mainly of a local character. The pronounced trend of soil acidification by acid rain has been slowing down in recent years, primarily due to a reduction in air emissions in Europe. Soil salination in the Neretva river valley has increased intensively, and the problem of the soil alkalinisation is mostly restricted to the area of Eastern Slavonija and Baranja. Pedological drought, i.e. the lack of usable water in the Picture: 2.2. - Protected areas Source: State Institute for Nature Protection soil, is on the rise.
The Croatian energy system is largely dependent on oil and natural gas. In order to support economic growth, energy imports are expected to substantially increase. Hydro-electricity represents a significant share of gross electricity consumption; on average over a ten year period, hydro-electric plants produced 34.7% of Croatia's electricity. Beside hydro-electricity, Croatia has relatively abundant renewable energy potential: wind, solar, biomass, geothermal, which has not been sufficiently used so far. In 2002, excluding large hydro plants, renewable energy sources (RES) constituted for 0.6% of electricity consumption. Croatia has set the minimum share of RES (without large hydro plants) to 1140 GWh/year in 2010, which will represent approximately 5.8% in the structure of total energy demands. Croatia uses cogeneration potential and the prediction is that it will satisfy 14.9% of her electricity needs by 2010 (mostly it refers to the high efficiency of cogeneration). There are two wind power plants operational in two Dalmatian counties while two more are being constructed. There is interest expressed in other counties along the coast for further construction. Croatia is planning to place on market 22,000 tonnes of bio fuels in 2007 while indicative target is 5.75% share of bio fuels by the end of 2010.
Most Croatian indicators show a reduction in the emissions of major air pollutants since 1990. In 2004, air emissions were considerably lower than in 1990 (SO2 by 65%, NOx by 20%, CO by 38%, NMVOC by 20%, lead is 27 times lower, dioxane/furan by 42% and polycyclic aromatic hydrocarbons by 35%). Presently, Croatia meets the peak emission targets set down by the Protocol to the Convention on Long-range Transboundary Air Pollution, relating to a further reduction of sulphur emissions by 22 % in comparison to the 1998 value till the 2010.
The major sources of pollution are combustion processes, mainly large stationary sources (five thermal power plants and three refineries), as well as traffic.
26 Annex I protected species in Croatia: 123 (100 regullary occurring) avian species, 20 mammals, 14 amphibians & reptiles, 44 fish, 31 invertebrates and 17+3 plants (figures will be changing) 30 The air quality is monitored at local and state level. Croatia has a local27 air quality-monitoring network, with 108 measuring stations operating in 32 towns or settlements; but this does not fully meet the statutory requirements. For example, the monitoring stations are not evenly distributed and do not cover all regions; but they do cover the largest towns, areas of high industrial activity and areas where possible trans-boundary pollution is expected.
A national state air quality monitoring network is being established with 8 monitoring stations in industrial/urban areas; and it is being developed and expanded to include the measurement of background pollution, regional and long-range trans-boundary transport and air quality measurement in protected areas. The PHARE 2006 project “Establishment of Air Quality Monitoring and Management system” envisages a further 12 stations added to the state network.
The Croatian Parliament ratified the Kyoto Protocol on 27th April 2007.
Regulation (OG 1/07) on the monitoring of GHG emissions was adopted by the Croatian Government at the end of 2006, and is aligned with the Council Decision 280/2004/EC. It establishes a national system for the estimation of anthropogenic emissions by sources and removals by sinks of all greenhouse gases not controlled by the Montreal Protocol28. There are also provisions for setting up the National Registry in line with Commission Regulation 2216/2004 for a standard and secure system of registries. A charge on the emission of carbon dioxide (CO2) was introduced in July 2007.
The main goals to be achieved in the air quality sector, according to the NES, are: 9 The alignment of the existing legislation with EU requirements and other international commitments; 9 The reduction of the existing emissions specially in regard to the transport sector; 9 The upgrading of the emission and air quality monitoring system.
The general state of the environment in Croatia is good, especially compared to the situation in the EU industrial countries or in some neighbouring countries; this is largely due to low-levels of industrial production. However, the degree of environmental protection is lower compared to other developed countries, primarily due to the lack of public investment. Nevertheless, Croatia is determined to protect its environment and landscape, in balance with economic and social interests.
27 Local = counties, cities and municipalities, which have the potential to experience the worst pollution incidents. 28 Established under Article 5, paragraph 1 of the Kyoto Protocol 31 Croatia’s population numbered 4.437 million in 2001, which makes an average population density of 78 inhabitants per km2 with slightly more than 69% of the population being urban; on the basis of these statistics, Croatia is one of the least populated European countries. The most densely Table 2.1. Correlation between number of settlements and populated part of the country is the northwest, which is number of inhabitants inhabited by almost 40% of the total population in what is about 15% of the area of the country. A lower, but still Settlement size Number of Number of % of (number of settlements inhabitants inhabitants above-average, population density is found in the inhabitants in Croatia easternmost, westernmost and southernmost parts of the country, whereas the vast central area, which covers 50% Without inhabitants 105 of the country, is considered demographically and economically “impoverished”. 1-500 5,387 799,240 18% Croatia is divided into 20 counties and the City of Zagreb; 501-2,000 1,040 953,305 21% the counties contain 425 municipalities and 124 towns. Four cities, the capital Zagreb, and Split, Rijeka and 2,001-7,000 173 594,516 13% Osijek, are inhabited by about 25% of the total population and represent the major urban and development centres 7,001-15,000 29 291,756 7% with significant surrounding wider economic catchment areas. Other bigger towns (with over 30,000 inhabitants) 15,001-30,000 9 174,361 4% are: Pula, Zadar, Šibenik, and Dubrovnik in the Adriatic basin, and Varaždin, Karlovac, Velika Gorica, Sesvete, 30,001-80,000 12 523,207 12% Sisak, Slavonski Brod, Vinkovci, and Vukovar in the Black Sea basin. There are 7 urban centres with populations > 80,000 4 1,101,075 25% over 50,000, which represents 29% of the country’s Total 6,759 4,437,460 100 population, and a further 31 towns with populations between 10,001 and 50,000 representing a further 15% of Source: Census 2001, Croatian Bureau of Statistics the total population in Croatia. Together, 44% of the population lives in sizeable communities of above 10,000 inhabitants. At the other end of the scale, 39% of the population live in communities below 2,000 inhabitants, and 52% live in settlements below 7,000 inhabitants (see Table 2.1).
The average size of the counties is Picture 2.3. Inhabitants per settlement somewhat above 180,000 inhabitants 41 settlements and 41% of the population lives in 6,3% population 31 settlements counties with less than 200,000 148 settlements 15,2% population inhabitants. However, in these counties, 10% population unemployment runs at 20% and their average contribution to GDP is around 7 settlements 1041 settlements 29% population 80% of the national average. 21,5% population Inhabitants per settlement The state of the environment in Croatia 1-500 has been assessed on a regular basis 501-2000 and is considered to be generally good. 2001-5000 The State of the Environment Report for 5001-10000 the 1997-2005 period was adopted by 10001-50000 the Croatian Parliament in May 2007. >50000
The 2002 NES identifies 13 priorities, of 5491 settlements which the top two are waste and water. 18% population Air quality is third, the Adriatic (the sea, islands and coast) is a fourth and soil protection is fifth. Nature protection is the sixth priority. Waste is the top priority Source: National Bureau of Statistics because of the legacy of the past, when there was limited compliance with waste legislation and poor waste management practices; this led to a profusion of illegal waste dump sites, which are hazardous to health, unsightly and pose a risk of groundwater contamination. Waste 32 management problems in Croatia are particularly noticeable, and have led to a critical situation in the majority of local authorities. It also has an adverse impact on the landscape and tourism. Therefore, solving waste management problems remains the absolute priority. The trend in Croatia, like other EU countries, is for waste volumes to rise, and the existing infrastructure is insufficient. The situation has been improved by the remediation and closure of municipal landfills all over the country, initiated by the Environmental Protection and Energy Efficiency Fund in 2004. Table 2.2: Comparison of some environmental indicators Water is also a Municipal Municipal Connection Population Share of Weighted priority in the waste waste levels to connected to electricity from emissions of environment generated landfilled public urban wastewater renewable greenhouse sector because 2005 2004 water collecting system energy to gases the investment (kg per (kg per supply (regardless of gross 2004 person per person per 2002 treatment) electricity (million required is the year) year) (%) 2002 consumption tonnes of CO2 greatest, (%) 2005 equivalent) particularly in (s) upgrading EU 25 526 238 : : 13.6 4979.57 water treatment EU 15 567 234 : : 14.5 4227.39 facilities and Slovenia 423 313 90.6 63 24.2 20.06 building Slovakia 289 222 : 55 16.5 51.02 sewerage Hungary 459 294(b) 93.0 62 4.6 83.06 networks. Bulgaria 463 396 98.8 68 11.8 67.51 Effluent from Romania 382 (e) 305 54.2 43 35.8 154.63 rudimentary Croatia *327 (e) *311 (e) *76.0 *40 36.1 28.95 treatment Source: Eurostat, except for * = Croatian national sources systems is the (:) Not available; (e) Estimated value; (b) Break in series; (s) Eurostat estimate main cause of water pollution, particularly in rural areas where half the population lives, but also from large settlements where the level of treatment is inadequate.
The same applies to the air sector – high investments are needed but integration of air quality requirements into the other sectors – especially in energy production, transport, industry and agriculture - is not a priority for this programming round. Care must particularly be taken of the balance between raising air quality and activities undertaken on behalf of economic developments. Among the environmental sub-sectors29, only two (waste and water) are in the EPOP’s priority axes for the period 2007-2009.
2.1.2. Environmental sub-sectors As already mentioned, the waste, water and wastewater, and air quality sub-sectors present the greatest investment challenges, according to the NES. The two top priority sub-sectors are described in detail. The waste and water sub- sectors are a priority because they are the most critical to the country’s economic development, requiring significant investment, and they were identified as the highest priority in Croatia’s AP with the EU.
29 This decision is based upon the limited resources available and conclusions of strategic documents. Given existing resource constraints, and the sequencing of investment funds and the poor state of their existing infrastructure they are deemed to be the overwhelming priority. 33 Description of the waste management sub-sector
The National Environmental Protection Strategy (NES) and National Environmental Action Plan have established that inappropriate waste management is one of the greatest problems in the field of environmental protection in Croatia.
The National Waste Management Strategy (NWMS), which was adopted in September 2005 and is a constituent part of the NES, sets the following strategic goals in the area of waste management: 9 Avoidance and minimisation of waste volumes at source and of waste to be disposed, with material and energy recovery from waste; 9 The development of infrastructure for an integrated waste management system AEL (Avoidance-Evaluation- Landfilling) (creates conditions for the efficient functioning of a system); which involves establishing up to 21 county/regional waste management centres, with waste pre-treatment before its final disposal or landfilling; 9 The minimisation of the risks from waste under the scope of which falls remediation of existing municipal waste landfills (with closure or prolongation of activities), and remediation of sites highly polluted by waste (hot spots); 9 Contribution to employment in Croatia through the development of domestic industry and businesses, and the production of municipal equipment; 9 Education of administrative structures, experts and the public in order to solve waste management problems.
Table 2.3.: Municipal waste produced per County The total amount of municipal waste produced in Croatia in (2005) 2005 was estimated at 1.45 mil. t (average 0.90kg/person/day Municipal or 327 kg/person/year). waste County Population On the basis of data on the average annual composition of produced in municipal waste30, it is assessed that 74.5% of municipal waste 2005 (tonnes) refers to biodegradable waste (kitchen and bio-waste, paper 1. County of Zagreb 309,696 81,181 and cardboard, leather and bones, wood, textile). 2. Krapina-Zagorje 142,432 30,640 3. Sisak-Moslavina 185,387 62,332 With the establishment of new waste management centres and 4. Karlovac 141,787 37,174 with the use of waste treatment technologies within those 5. Varaždin 184,769 40,206 centres it is planned by 2015 to reduce the share of 6. Koprivnica-Križevci 124,467 26,249 biodegradable municipal waste which is deposited in landfills to 7. Bjelovar-Bilogora 133,084 36,740 50% of the mass of biodegradable municipal waste which was 8. Primorje-Gorski kotar 305,505 114,984 produced in 1997 (as reference year). By 2020 this share will 9. Lika-Senj 53,677 17,766 be reduced to 35%. 10. Virovitica-Podravina 93,389 26,391 11. Požega-Slavonija 85,831 27,658 Croatia has a relatively good potential for the use of biomass 12. Brod-Posavina 176,765 54,818 which occurs as a by-product and waste in the forestry, 13. Zadar 162,045 69,659 agriculture and wood-processing industries. Such potential is 14. Osijek-Baranja 330,506 126,456 recognised and targets have been set31: it is planned to 15. Šibenik-Knin 112,891 35,367 produce 200 GWh of electricity by 2010 and 1000 GWh by 16. Vukovar-Srijem 204,768 42,245 2020 from biomass. 17. Split-Dalmatia 463,676 142,423 18. Istria 206,344 96,400 Forest biomass is already used for district heating in the cities 19. Dubrovnik-Neretva 122,870 44,410 of Gospić and Ogulin, and additional pilot projects are initiated 20. Međimurje 118,426 24,533 in three more cities. The further use of biomass in 1 MW district 21. City of Zagreb 779,145 311,749 TOTAL: 4,437.460 1,449,381 heating facilities is envisaged and a specialised state owned Source: National Waste Management Implementation company (Forest Biomas Ltd.) has been established to facilitate Plan those activities.
Table 2.3. shows waste production at a county level. It includes data on waste from tourism which is estimated to amount to 97,700 tonnes per year. Overall, the amount of waste from tourism is not significant, but given the fact it is
30 T. Domanovac, R. Orašanin: Sastav komunalnog otpada kontinentalnog i priobalnog dijela Republike Hrvatske, VII. Međunarodni simpozij gospodarenja otpadom Zagreb, 2002. (Municipal waste system in continental and coastal parts of the Republic of Croatia, VIIth International Waste Management Symposium, Zagreb 2002) 31 Draft National Strategy and Action Plan for meeting the obligations under the UNFCCC and Kyoto Protocol 34 produced within the short period of summer, mainly in the restricted coastal area, it is burdening for particular municipalities and even counties (the specific amount of tourism waste is estimated at 1.90 kg/tourist/day).
The volume of municipal waste arriving at licensed landfills has gradually increased. The reasons for this are various: 9 A larger proportion of the population has organised collection, transport and disposal of waste; 9 Greater volumes of waste per capita are being produced.
Picture 2.4. shows estimates of the quantities of municipal waste Picture 2.4.: Increase of municipal waste produced produced in selected years. Although data for years 1995 and 2000 could be taken with some reserve, the increase in the amount of produced municipal waste over a ten-year period is significant.
The estimated quantity of construction waste in the 2001-2005 period amounts to 1,254,152 tonnes32. Most of the construction waste is deposited on landfills, usually in an uncontrolled manner on dumpsites.
According to data from the Environmental Emission Cadastre (EEC), in 2004 1,514,363 tonnes of non-hazardous production (technological) waste was generated. The highest share in the totally produced quantity of non-hazardous waste is reported for Source: for years 1995 and 2000: IPZ Uniprojekt MFC the following waste categories: d.o.o.; For 2005: National Waste Management Plan
9 Waste from agriculture, gardening, hunting, fisheries and the primary production of water crops, preparation of food and beverages (23.28 %) The indicated types of waste, after appropriate pre-treatment, are mostly used at their site of origin, and part of the calcium carbonate is received by individual farmers, who use it for correcting the pH-value of agricultural soil. 9 Waste from anorganic chemical processes (21.83%) This waste is landfilled at a regulated landfill for category I industrial waste owned by the Petrokemija d.d. company.
In a preliminary assessment of the quantity of hazardous waste generated in the Republic of Croatia it was established that the total quantity of hazardous waste generated (213.000 t/year) is three times higher than the quantities of hazardous waste reported in the EEC. Due to various reasons, some types of waste are reported to the system very rarely, and the data is often incomplete or of low quality. All this points to the problem that the Waste Cadastre is still not able to ensure complete and integral data regarding the quantities, types and flows of the generated waste. The assessed quantities of new electrical and electronic equipment and devices placed on the market range from 55,000 to 60,000 t/year. The estimated quantity of waste batteries and accumulators is 8 500 t/year. The consumption of batteries and accumulators is constantly increasing. The assessed quantity of new accumulators and batteries placed on the market amounts to 11,000 t/year.
The import of hazardous waste and the import of non-hazardous waste, for landfilling and use for energy purposes, is prohibited in Croatia. In 2004, 363,889 tonnes of non-hazardous waste were exported, mostly metal (84%). In the same year, 265,265 tonnes of non-hazardous waste was imported to Croatia, mostly paper and cardboard, and granulated slag from iron and steel production for the production of cement.
The quantities of packaging waste are assessed by the quantity of packaging placed on the market. An increase has been observed in the quantities of paper and cardboard packaging, glass packaging and particularly of plastic packaging (Table 2.4).
32 "LIFE TCY/CRO/000114 CONWAS" Project, Faculty of Civil Engineering of Zagreb University
35 According to assessments, the quantity of waste tyres Table 2.4.: Consumption of packaging ranges from 20,000 to 30,000 tonnes per year. The Thousand of tonnes Packaging existing Ordinance on Waste Tyre Management secures 2001 2004 the management of previously discarded tyres within the paper and cardboard 91,7 96,8 territory of Croatia (70,000 to 100,000 tonnes), by Glass 81,6 97,7 Plastic 29,8 39,1 organising occasional actions for the collection of Metal 13,4 11,5 discarded tyres from citizens, and paying a special fee to Total: 216,5 245,1 citizens for the delivered tyres. Source: State of the Environment Report The number of end-of-life vehicles arising in the Republic of Croatia may be assessed at the annual level as ranging from 70,000 to 80,000 vehicles.
The analysis in the NWMS suggests that Croatia faces two main problems in relation to waste management: 9 The volume of municipal waste being landfilled is constantly increasing; and 9 The separation and recycling of waste is increasing, but there is scope for further improvement.
92.8% of the population is served by an organised municipal waste collection service33 (figure 2.5). The Waste Act stipulates that municipalities or towns shall provide for the implementation of measures for municipal waste management.
Picture 2.5:Share of population served by organised municipal The separate collection of individual waste waste collection by Counties (2005) components is in place and is implemented with various intensity in almost all counties. According to 2005 data, the system of separate waste collection was implemented through a total of 39,030 containers for different waste components on the territory of the Republic of Croatia. For miscellaneous municipal waste 158,191 containers were recorded on the territory of Croatia.
In order to establish a primary recycling system, to date the Environmental Protection and Energy Efficiency Fund has granted funds for the procurement of 155,000 bins, containers and green islands in 161 towns and municipalities with a total value of 22.3 million kunas (around 3 m€).
Landfills absorb the biggest quantities of waste produced. In 2004 there were 281 controlled landfills of which 252 active (with a total active capacity of 69,402,670 m3,), but only 25 have all the necessary permits (licensed)34.
There is a programme for the remediation of Source: National Waste Management Implementation Plan municipal landfills as well as the gradual remediation of illegal sites (assessed at around 3,000) and sites highly polluted by waste. The remediation of municipal landfills began in 2004 with support from EPEEF, so the situation has in the meantime changed. EPEEF has, in cooperation with MEPPPC and local authorities started the remediation of 292 official unregulated municipal waste landfills. In the course of 2007, EPEEF will publish another call for proposals for the remediation of municipal landfills for those authorities which did not apply in previous calls for proposals. The overall investment is valued at 2.8 billion kunas (around 380 m€), out of which EPEEF will participate with 1.5 billion kunas
33 “Guidelines Development for Starting Implementation of Waste Management Plan in the Republic of Croatia”, Ekonerg, Zagreb, 2006 34 Source: Cadastre of landfills, Final report, Croatian Environment Agency January 2005 36 (48%; around 200 m€). For this purpose EPEEF has already made payments in amount of 230m kunas (31 m€). So far 28 municipal waste landfills have been remediated.
It is estimated that only little more than 50% of non-hazardous production (technological) waste generated is sent to licensed landfills or separated. Therefore, an almost identical volume is deposited at illegal dumpsites, the number of which is estimated at 3,000. This imbalance has a detrimental effect on the environment, quality of life and the development of tourism. The situation is particularly complex on islands and in the coastal zone. However, remediation of landfills on many islands, which has been completed, and adoption and implementation of new ordinances on separate waste collection (packaging, waste tyres, batteries etc.) has substantially reduced pressures on the environment. A significant contribution to the reduction of the pressure on the environment has been achieved through opening of new facilities/installations for recycling secondary raw materials (plastic, metal, tyres, glass etc.) due to the introduction of new legislation on the basis of which the separate collection of different categories of waste has been organised. For the remediation of 512 illegal dumpsites, in the territory of 140 local authorities , and in 2 national parks and 2 nature parks, the EPEEF allocated 43.6 million kuna (6.0 m€), accounting for 66% of the totally assessed investment needs. Up until now, 217 illegal dumpsites have been remediated.
There are currently no regulated sites for hazardous waste landfilling in the Republic of Croatia. Therefore hazardous waste requiring landfilling (waste which cannot be recycled, recovered, etc.) is exported. During 2005, a total of 13,157.02 tonnes of hazardous waste was exported.
Thermal treatment of individual waste types is carried out within determined industrial facilities and hospitals: 9 All energy plants with power exceeding 3 MW may be used for the co-incineration of category I and II waste oils. Currently in the Republic of Croatia there are 17 authorised hazardous waste treaters using energy plants with power exceeding 3 MW for the co-incineration of hazardous waste, mainly waste oils and infectious waste. 9 Cement factories in the Republic of Croatia are included in the hazardous waste management system. Currently waste oils and some other waste types, e.g., waste tyres, meat and bone meal, are co-incinerated in cement factories. 9 Specialised incineration plants within the premises of economic operators have some smaller capacity for the incineration of waste from their own activities. The incineration plants are used for their own needs, and they have also begun to provide hazardous waste incineration services to other parties. 9 Incineration plants within hospitals incinerate their own infectious waste, and provide services to other hospitals only in exceptional cases.
As mentioned, significant progress has recently been made in establishing a new system for packaging and packaging waste management on the basis of the new Ordinance on packaging and packaging waste (adopted in July 2005). Implementation in practice started in 2006 through the application of a system of new charges for packaging waste disposal, being paid by producers and importers of packaging to the Environmental Protection and Energy Efficiency Fund.
The ordinance and the new system of charges have proved a success. Proof thereof are 910m units of packaging collected, that is, 78,500 tonnes of packaging waste that was returned in just one year35. Quantities of packaging waste collected in the first half of 2006 significantly exceeded annual quantities of packaging waste collected during previous years, prior to the adoption and implementation of the Ordinance on packaging and packaging waste.
Implementation of the recently adopted Ordinance on End-of-life Vehicles Management, Ordinance on Waste Tyres Management, Ordinance on Waste Oil Management, Ordinance on Waste Batteries and Accumulators Management, situation with regard to useful waste separation has substantially changed for the better. Those Ordinances have been in force for less than a year and precise data and indicators are not yet available, but based on the example of the Ordinance on Waste Tyres Management which has been in force for six months, a high percentage of separate waste collection is to be foreseen. Another example shows that in the first months of implementation of the end-of-life vehicles Ordinance, collectors received 1,015 waste vehicles.
35 Source: Environment Protection and Energy Efficiency Fund 37 A legacy of the past is the problem of sites highly polluted by waste left behind as part of industry has declined. A significant risk at the majority of these sites is the risk of groundwater contamination (particularly in the karst region), which poses a threat to the quality of potable water supplies. Therefore, the remediation of these sites is one of the priorities. There are nine sites which are listed as priorities: in the continental part of Croatia those are Lemić brdo near Karlovac, the landfill of oily sludges in Botovo, and the phosphogypsum landfill in Kutina; in coastal area those are basins with alkaline water and red mud on the site of the former alumina factory near Obrovac, the coke plant in Bakar, the slag landfill in Kaštela Bay, „Sovjak“ site near Rijeka, the slag landfill of thermal power plant TE Plomin I, the asbestos landfill in Mravinačka kava near Split. For remediation of nine priority “hot spots”, the Environmental Protection and Energy Efficiency Fund has allocated €22m for the 2005-2008 period.
Through the implementation of a PHARE 2006 project approved by the EC, a hazardous waste management system in line with the National Waste Management Strategy will be established, particularly in relation to the identification, characterisation and further management of “hot spot” sites and will increase the ability of relevant governmental authorities to apply and enforce the acquis communataire relating to waste management.
Major issues and problems in the waste management sub-sector in Croatia are: 9 Increased volumes of waste being sent to landfill; 9 Limited waste separation at the point of generation, along with low recovery and treatment rates; 9 Shortage of municipal waste recovery and treatment plants; 9 Non-existence of landfills for hazardous waste; 9 Insufficient engagement of waste producers to bear the actual costs of their waste disposal, and 9 Under developed information and reporting systems.
38 Description of the water management sub-sector
Water resources Croatia has relatively abundant fresh water supplies (see Table 2.5.). This, coupled with low population density and Table 2.5. WATER RESOURCES IN CROATIA level of economic development, is the reason why water-related problems are not acute and Danube Adriatic Croatian water resources are not yet a limiting factor Indicator Basin Basins average for socio-economic development. However, a major problem lies with the spatial and Total fresh water (109 m3/y) 128.38 27.94 156.32 temporal distribution of water resources. Renewable water resources36 83.72 27.94 111.66 (109 m3/y) The impact of anthropogenic pollution on groundwater is of local importance, but it Renewable water resources 27,487 20,077 25,163 (m3/y/ct.) occurs in the naturally vulnerable alluvial areas (mostly in the Black Sea basins) and Internal water (109 m3/y) 11.86 14.22 26.08 springs in karst areas. Also in the Black Sea Internal water (m3/y/ct.) 3,894 10,218 5,877 basin there are considerable areas with naturally poor groundwater quality due to Renewable groundwater 2.66 6.47 9.13 elevated contents of ammonia, arsenic, iron (109m3/y.) and manganese. Renewable groundwater 873 4,649 2,057 The majority of river basins, including (m3/y/ct.) groundwater, have a trans-boundary character; therefore, the efficient coordination Source: Draft Water Management Strategy of water management activities with neighbouring countries is necessary. Watercourse pollution is determined on the basis of Biological Oxygen Demand (BOD), total nitrogen and microbiological determinants (see Picture Picture 2.6. Water quality status of the watercourses 2.6.); this is mostly a Surface water quality according to the number of measuring stations and groups of consequence of determinants from 2000 to 2002. 1 0 0 untreated waste water 2 2 4 discharges from larger 100% 13 17 14 27 31 31 32 33 20 settlements - most 15 16 25 43 26 30 27 27 surface water is Class II 80% 36 74 68 73 and III (the lowest being 87 88 79 Class V); however some 60% 81 84 79 microbiological indicators 143 172 79 40% 91 103 make some water Class 107 82 92 77 CLASS V III and IV37 CLASS IV 94 94 107 20% 34 CLAS CLASS I I 36 27 CLASS II 55 47 The greatest differences 34 34 12 13 12 17 21 13 10 0% 5 between the actual and 2000 2001 2002 2000 2001 2002 2000 2001 2002 2000 2001 2002 target water quality Oxygen Regime Nutrients Microbiology Biology classes are recorded in Number of measuring stations/Groups of determinants the tributaries of the Sava River, because they Source: Draft Water Management Strategy receive large volumes of untreated wastewater from cities and towns. 75% of the largest towns are situated in the Sava basin.
36 Not including 50% of the Danube River and 50 % of the Sava River downstream of the Una river mouth 37 Classification of waters in five categories presents the assessment of the waters quality on the basis of the proscribed limit values of the following indicators: physical-chemical; Oxygen level, nutrients, microbiological, biological, metals, organic compounds and radioactivity. The limit values of the given indicators for each category are given in the Regulation on classification of water (Official Gazette 77/98 that is aligned with UN/ECE guidelines and methodologies. 39 Water Supplies
In 2005, the total quantity of water supplied to the population and industry via public water supply systems was 265 million cubic meters.
The provision of water supply is sustainable, except in tourist areas, especially the islands, during the tourist period in Table 2.6. PUBLIC WATER SUPPLY & the summer, when it is difficult to respond to increased consumption and WASTE WATER COLLECTION, 2002 demand; therefore, one of the development priorities is to raise the level of reliability of the water supply in these areas. Households with public Urban water supply wastewater Levels of connection to mains water supplies in Europe vary considerably (see systems Table 2.6.); the precise data for Croatia is still being collected but EU 25 - 90% approximately 76% of Hungary 93% 62% population has Austria 89.6% 86% access to a Slovakia 84% 55% public water supply system, Croatia 76 40% but this varies Source: Eurostat News release 37/2006, considerably - 21st March 2006 that level is higher in the Adriatic basins (about 86%) than in the Black Sea basins (71%).
The main source of public water supply is groundwater (about 90%), either abstracted from wells (mostly in the Picture 2.7.: Spatial distribution of quantity and quality of Black Sea basins) or springs (mostly in the Adriatic Sea groundwater basins). The remaining abstractions are made directly Source: Draft Water Management Strategy from watercourses or reservoirs, although, the latter are used primarily for energy generation. Drinking water supply sources are protected38 by sanitary protection zones that cover about 18% of Croatian territory and 28% of the country’s mainland (40% in the Adriatic basins and only 6% in the Black Sea basins); these zones produce 80% of the public water supply. Development in these areas requires CW and local government consent. The recharge areas for water resources in the protection zones lie beyond Croatia’s boundaries within Slovenia and Bosnia-Herzegovina. The level of connections to the mains public water supply varies by region across the country, the map above shows this distribution.
When compared by region, the highest level of water supply is in Istria (about 95%), and the lowest in Bjelovarsko- Bilogorska (only 31%). In the Sava river basin, excluding Zagreb County, but including much of Eastern Slavonia, the level of water supply from public sources is only 55%. All Average water urban centres have a relatively good water supply, but it is supply by area somewhat lower in the outlying settlements, and the lowest is in remote rural areas.
The age and lack of maintenance makes the water supply network highly permeable; losses are estimated at 40% of the total abstracted water.
Picture 2.8: Average water supply by area Source: Draft Water Management Strategy
38 Regulations on the Determination of the Sanitary Protection Zones will need to be harmonised with EU directives 40 Water quality is generally within the maximum allowed concentrations39 of determinants, but trends show some deterioration due to anthropogenic impacts. Sources that are particularly endangered are those around Pula in Istria, where pollution arises from agriculture, population and industry; aquifers supplying Varaždin, where pollution from agricultural nitrates and industry respectively are of concern; and supplies to Split are potentially at risk from industry and human activities. The eastern part of the Danube river basin has high levels of arsenic and manganese leading to natural reductive conditions, which require some pre-treatment before use as a water supply. The spatial distribution map (Picture 2.7) depicts the quality and quantity of groundwater in the country; hydraulic conductivity is a property of soil or rock that describes the ease with which water can move through pore spaces or fractures. It depends on permeability of the material and on the degree of saturation; hence it provides both an indication of the ease of abstraction and the risk and susceptibility to pollution. Picture 2.9. Point Sources of Ground Water pollution Source: Draft Water Management Strategy
The pollution map above shows the sources of pollution in the country; the majority are discharges from wastewater treatment facilities. There are also 21 landfills whose effluent is discharged untreated or leaches directly into the ground. It is likely that there are many more old landfill sites that pose a hazard. The map also shows 33 industrial sites that are polluting groundwater.
Sewerage and Waste Water Treatment
Only 12% of wastewater generated by population is treated, with only 4.4% receiving biological treatment in 82 wastewater treatment plants in settlements; therefore, the major source of pollution to surface waters is human. About Table 2.7. A CONNECTIONS TO RIVER BASIN SEWERAGE 50% of the total industrial wastewater is discharged into the NETWORKS (2006) public sewerage and wastewater treatment system, after preliminary treatment; this is not always at the level of River basin Connection Populati Connection municipal wastewater quality. Approximately 30% of sewerage on (mil.) to WWTP (%) industrial wastewater is directly discharged (with some and system (%) without any pre-treatment), while the remaining quantities Sava 2.2 46 28 are treated in independent industrial wastewater treatment Drava/Danube 0.8 29 16 plants to a sufficient level for discharge. One of the consequences of insufficient treatment is the risk of Primorje – Istra 0.5 58 45 potential eutrophication, especially of natural and artificial Dalmatia 0.8 31 6 lakes and oxbows as well as coastal bays. Total 4.4 40 20 Table 2.7. summarises the level of connections to Source: Draft Water Management Strategy sewerage systems according to river basin catchment area. It is estimated that only 40% of the population is connected to a public sewerage network, whose total length is about 6,000 km, with 333,530 connections (2002). While the connection rate to sewerage systems is quite low overall, it
39 Regulations on Water Classification 41 depends on the size of the settlement; largely because the population density is varied, ranging from 20 to 200 inhabitants per km2, resulting in great differences in infrastructure development.
The largest share of population connected to sewerage systems is in large towns (76%); whereas in settlements of fewer than 2,000 inhabitants it is almost negligible (about 5%); this is critical because nearly 40% of the total population lives in such settlements. Having in mind the age of the sewerage system in the cities, it can be assumed that most of the sewerage systems are highly permeable; thus this represents a significant source of water pollution. Rectifying this is a priority. Table 2.8. summarises pollution loads in the river basin catchments areas; industrial sources contribute around 28% of the loads, with nearly 70% arising from households in settlements across the country, but over 50% comes from settlements in the Black Sea basins. However, in total the Black Sea basin catchment area receives 75% of the water borne pollution. Since 1990, pollution from industrial effluents has declined as a consequence of economic recession and the introduction of cleaner technologies, the recycling of water in technological processes and the construction of industrial wastewater treatment plants. A wastewater monitoring system is used to estimate the impact of point sources of pollution on surface waters.
Table 2.8. TOTAL ANNUAL LOAD FROM POINT SOURCES OF POLLUTION (BOD5, 2001)
Basin LOADS BOD t/year
Population % pop' % total Tourism-related Industrial % ind' % total Total % by loads load load load load load load basin
Sava river basin 48,440 50% 35% 0 13,362 35% 10% 61,802 45%
Danube river basin 18,259 19% 13% 0 21,845 57% 16% 40,104 29%
Dalmatian basin 18,718 19% 14% 884 647 2% 0% 20,249 15%
Littoral-Istrian 11,757 12% 9% 1,998 2,392 6% 2% 16,147 12% basins
Total Adriatic Sea 30,475 31% 22% 2,882 3,039 8% 2% 36,396 26% basins
Total Black Sea 66,700 69% 48% 0 35,206 92% 25% 101,906 74% basins
Croatia 97,175 2,882 38,245 138,302
70% 2% 28% Source: Draft Water management strategy
One of the prerequisites for complying with the urban wastewater treatment directive is the identification of “sensitive areas” and “agglomerations”; this list is being prepared. In the meantime, Croatia has a public works programme to upgrade the wastewater treatment plants and sewerage systems in the main population centres. This programme will be completed by 2025. An additional problem is the large number (130) of municipal companies operating in this sector (some in the public water supply sector too); this results in inefficiency, which is mostly due to the low number of connections of dwellings to the sewerage network. Market forces should encourage the consolidation of municipal companies, which might improve service efficiency. This problem is identified also in Water Management Strategy and the plan is to transform the present system in regional systems.
In terms of the projects nominated for IPA funds, this will not represent a problem because the IPA-nominated projects include larger plants in the area under the responsibility of larger utility companies (e.g. Osijek, Slavonski Brod) which are well equipped (both in technical terms and in terms of staffing) for managing the system. 42 Technical assistance in terms of a suggestion on how to do this is welcome; however, before this can happen, the Strategy has to be approved in Parliament, i.e. TA for this purpose will not be sought within this programme’s TA.
Croatia is subject to considerable periodic flooding, which inflicts severe economic damage; these floods are caused by: 9 River floods, due to extensive rains and/or sudden snow melting; 9 Stream floods of smaller watercourses, due to short rains of high intensity; 9 Floods on karst fields, due to extensive rains and/or sudden snow melting; 9 Floods of inland waters on lowland areas; and 9 Ice floods. In addition, flooding may occur due to dams and barriers breaching, landslides and inappropriate construction. Significant problems may be caused also by floods in urban areas, due to short precipitations of high intensity, which, because of high population concentration on relatively small areas, often cause large material damage, and for which protection measures are planned at the local level as wastewater sewerage and drainage systems are built.
The biggest registered floods in Croatia during the last hundred years were: 9 Danube river: in 1926 and 1965 year; 9 Drava river: in 1964, 1965, 1966, and 1972 year; 9 Mura river: in 1965 and 1972 year; 9 Sava river: in 1933, 1964, 1966, 1990, and 1998 year; 9 Kupa river: in 1939, 1966, 1972, 1974, 1996 and 1998 year; 9 Una river: in 1974 year; 9 Neretva river: in 1950, 1995 and 1999 year.
Due to inadequate investment in maintenance of the flood protection system, its effectiveness has since 1991 decreased from an average of 60% to an average of Picture 2.10: Flood protection 40%. This effectiveness varies according Source: Draft Water Management Strategy to location and is generally much higher in large settlements (see map). In the Sava river basin, the system is not completed and there are still issues to be resolved along the border with Bosnia. The Danube flood protection system is not complete and in the Adriatic, more protection is required to deal with storm water.
43 2.1.3. SWOT analysis This SWOT is a summary of the main environmental issues in Croatia and concentrates on the waste and water priorities.
Strengths (internal / current) Weaknesses (internal / current) General: General: Unique natural environment with good legal EU environmental principle not fully applied & protection and high level of biodiversity insufficient integration of environmental protection Relatively high quantities of fresh water of quite into other sector policies good quality Public awareness and information on protection of Basic strategic documents in the environment environment and natural resources as well as sector developed or under preparation (air quality, sustainable development is improving, but there is water master & waste management plans) insufficient level of professionalism within NGO Waste: sector, which leads to misleading of wider public. Insufficient administrative/institutional capacities at Waste Management Strategy and framework national and sub-national levels legislation in place The relatively high number of public utility Specialized companies and public utility companies companies in Croatia results in sector inefficiency. ready to use integrated waste management (WM) Rationalisation needs to take place. systems Relative lack of financial resources for the Plans for remediation of sites highly polluted by necessary investments (specially those required by waste (hot spots) developed “Heavy investment” Directives) Water: Waste: Croatia has relatively abundant & good quality fresh WM plans at county level not fully completed water mainly due to difficulties in defining the locations of Industrial effluent has significantly declined over last future waste management centres (NIMBY) 10 years Insufficient coordination of waste streams Water quality monitoring system well developed management on local level due to the lack of staff Institutions for water management with well qualified Complexity of process of securing own funds for staff who have experience in managing investments on local and county level internationally funded projects exist Lack of reliable data concerning waste types and amounts Water: High percentage of sensitive areas in the country is vulnerable to pollution (karst area especially) Water losses significant, age and insufficient maintenance of water/ sewerage network/facilities Permanent activities on environmental awareness for water conservation needed Water management strategy not yet adopted
44
Opportunities (external / future) Threats (external / future)
General: General: Interest among domestic and foreign investors in Disparities between environmental protection and the environment sector as a driving force for economic development needs may exert additional economic development pressure on the environment, particularly natural Investment in new technologies for waste and resources & nature, especially in the coastal zone water management, leading to new & secured jobs & in karst areas Grants from EU pre-accession funds for co- Difficulties of coordination and the short financing project implementation leverages scarce implementation period for EU funded actions (n+3) national funds Waste: Waste: Approx. 3,000 illegal waste dumps and 9 hot spots Rationalisation of waste sector public utility (old burdens) companies with implementation of National Waste Water: Management Implementation Plan and All national river basins have transboundary organisation of up to 21 waste management character, coordination with neighbouring countries centres is necessity TA used to prepare investment strategies / Some drinking water sanitary protection zones lie documentation for implementation of investment beyond the boundaries of Republic of Croatia projects
WM information system being developed in the waste cadastre Investments available to help implement integrated waste management systems at county / regional levels Indicative list of projects for the waste sector now developed for future investment Industry & public needs educating in waste avoidance / minimization, waste recovery and recycling Large amount of biomass and waste from agricultural & forestry is a potential source of renewable energy Water: Harmonization with EU standards will help in improving existing situation Funding system developed, but not satisfactory
There are a number of issues that emerge from the SWOT analysis that Croatia will need to address, namely: 9 Transposition, implementation / compliance plans for all directives, priority to be given to “heavy investment directives” (development of financial strategies); 9 Implementation of the National Waste Management Implementation Plan and completion and implementation of the Water Management Strategy; 9 Securing the necessary financial resources for investments; 9 Institutional, administrative and management capacity-building at all levels with improved exchange of information and communication; 9 The rationalisation and restructuring of the public utility company sector; 9 Incorporating the principles of sustainable development into all investment and development programmes; 9 Encouraging environmental education within industry and management;
45 Not all of these issues can be addressed through the EPOP, but it can make a significant contribution by providing experience in managing and implementing large-scale investments. This experience will help the Croatian authorities to develop the capacity and skills needed to use EU funds upon accession.
2.1.4. Medium term needs and objectives in the waste management sub-sector In line with the draft National Waste Management Strategy, and other national programming documents the medium term needs and objectives in this sub-sector are: 9 The establishment of county/regional Waste Management Centres (3-7 county centres until 2010); 9 The remediation of existing landfills (up to 65% by the end of 2010) and closure of all landfills on islands; remediation of sites highly polluted by waste (hot spots); 9 A reduction of the quantity of disposed municipal waste on existing municipal waste landfills (up to 30% by the end of 2010); 9 The further development of an integrated hazardous waste management system (permanent); 9 The further institutional capacity building (permanent); 9 The further development of information and reporting systems (permanent); 9 The rationalisation and restructuring of the public utility company sector On the basis of the National ISPA Strategy and the Financial Memorandum signed between the European Commission and Government of the Republic of Croatia in October 2006 for the ISPA measure entitled Bikarac Regional Waste Management Centre, it is envisaged that the Bikarac RWMC will be established by the end 2010. The Bikarac RWMC will be the first waste management centre in Croatia that will be built by the support of European Commission and national contribution. Accession Partnership (Environmental sector), highlights the short-term and medium-term priorities. The medium term priorities (3-4 years period) in the waste management sector includes: 9 Ensure the integration of environmental protection requirements into the definition and implementation of other sectoral policies; 9 Develop an environmental investment strategy based on estimations of the costs of alignment; 9 Continue to implement horizontal legislation; 9 Continue work on the transposition of the EU acquis, with particular emphasis on waste management, water quality, air quality, nature protection and integrated pollution prevention and control; 9 Increase investments in environmental infrastructure, with particular emphasis on waste water collection and treatment, drinking water supply and waste management; In the terms of the Accession Partnership, the EPOP will contribute to the medium-term priority – increase of Investments in environmental infrastructure, where the emphasis is on wastewater collection and treatment, drinking water supply and waste management. Waste management is set in the Strategic Coherence Framework 2007-2013, as one of two priority objectives (alongside water management) to be financed under the scope of IPA assistance. Within the Multi-annual Indicative Planning Document (MIPD) priorities comprise acquis-related investment in waste water collection and treatment, and drinking water supply and waste management (the construction of new landfills and the closure of non compliant landfills). The national legal framework for the waste management sub-sector will be fully aligned with the acquis by the end of 2008, as planned and stated in the NPIEU 2007. The National Waste Management Implementation Plan was adopted by the Government of the Republic of Croatia in July 2007. County waste management plans have been prepared or are under development and have to be aligned with National Waste Management Implementation Plan by the end of 2007.
46 2.1.5. Medium term needs and objectives in the water management sub-sector In line with the Water Management Strategy the medium term needs and objectives in this sub-sector are: The strategic goals for the development of public water supply are: 9 To increase the percentage of population supplied with water from public water supply systems, which is in line with European standards; 9 The establishment of sanitary water source protection zones and the implementation of adequate protective measures, and activities related to the improvement of drinking water conditioning in accordance with the EU Drinking Water Directive; 9 The reduction of losses from water supply distribution networks is expected to intensify. In view of the problems related to the existing status of water utility management, intensive work will be carried out on its consolidation, i.e. on the establishment of distribution/service areas as technologically and economically sustainable units.
The strategic goal of water protection is 9 The intensive construction and reconstruction of urban wastewater sewerage and treatment systems; 9 To increase the percentage of population connected to public sewerage systems so that the key requirements of the EU Urban Wastewater Treatment Directive are met; 9 To repair existing sewerage networks with significant permeability, which helps conserve drinking water sources.
2.2. STRATEGIC PRIORITIES
Under the three overall aims – preparation of relevant institutions for management of Structural fund, alignment with the acquis and contribution to socio-economic development - the EPOP, which will run initially for three years from 2007-2009, is designed to directly contribute to the:
9 Development of infrastructure for waste management for establishing an integrated waste management system in Croatia, including the remediation of sites highly polluted by waste; and 9 Protection of water resources (through improved water supply and an integrated waste water management system).
Technical assistance is set as a third priority with the aim of providing assistance for the management and implementation of assistance granted under Component III Regional Development – environmental protection. Project pipeline preparation is included in the two development priorities.
47
TABLE 2.9. ENVIRONMENTAL OBJECTIVES AND PRIORITIES FOR THE OPERATIONAL PROGRAMME National SCF EPOP Objective Priority Axis Meeting priorities / axes through environmental investments to: objective
Establishment of new waste management Developing waste management centres at county/ regional levels infrastructure for establishing an integrated waste management system in Croatia Remediation of sites highly polluted by waste (hot spots)
Establishment modern water supply
sectors sectors systems and networks Protecting Croatia’s water resources through improved water supplies & integrated Construction of wastewater treatment wastewater management systems plants for domestic and industrial
Improve access to, and the efficient Improve access wastewaters and upgrading of the facilities in the waste and water sub- facilities in the waste and water Protect and improve natural and living natural Protect and improve delivery of, environmental services and delivery of, environmental environment and environmental potential environmental environment and as a key element for future development for future development element as a key sewerage network
Improvements to waste management will concentrate on: (i) Establishment of new waste management centres, as a part of an integrated waste management system which is in development; and (ii) Remediation of sites highly polluted by waste in the karst area that pose significant risks of contamination to ground waters that serve as sources of drinking water, or potential sources of drinking water (strategic drinking water reserves). Improvements to water management will focus on: (i) Providing sufficient quantities of potable water by protecting effectively drinking water sources, encouraging the rational use of water resources, reducing losses occurring within the water supply network, and raising connection levels to water supply systems in areas with low connection levels, increasing the efficiency and reliability of the water supply system; (ii) Increasing connection levels to sewerage and wastewater treatment facilities, by constructing new WWTP and networks, as well as increasing the efficiency and reliability of the public sewerage and WWT system; and (iii) Repairing existing sewerage networks with significant permeability, which helps conserve drinking water sources.
In order to reduce pollution, the construction of WWTP and/or upgrading of the sewerage system are especially necessary in the Danube and Sava river basins. Both objectives will provide synergy for, and opportunities to increase, potential employment and SME development, as well as improving the investment climate and raising interest among domestic and foreign investors.
The above-mentioned assistance provided under this Operational Programme will be directed into the priority areas covered by Regional development component of IPA programme as stipulated in the Article 147 of the IPA Implementing Regulation, namely environmental measures related to waste management, water supply, urban waste water; rehabilitation of contaminated sites and land and technical assistance activities.
2.2.1. Waste management Waste management is defined as a set of activities, procedures and systems for waste prevention, reduction and/or its harmful influence on environment, and for its collection, transport, recovery, treatment and ultimate disposal. The procedures and systems should also define the supervision of all activities, as well as the regime for managing landfills, once they have been closed down. Often these activities, procedures and systems are the
48 responsibility of different authorities, both public and private; best practice in the EU is moving towards an integrated approach to waste management involving, and sharing responsibility between, all the players.
Integrated waste management is the term used to describe the transformation of management procedures into the safe and efficient management of municipal solid waste streams, with the least possible harmful effects to human health and natural environment. An integrated waste management system includes some or all of the following components: reduction of waste quantities at source (including multiple use of products), recycling of materials, treatment of waste before final disposal (using energy generated by waste), and final waste disposal.
The activities designed to improve waste management are based on the Waste Directives, the NES, NEAP, National Waste Management Strategy; and they are targeted at the: 9 Provision of technical pre-conditions for the reduction of waste generation and its harmful effect on the environment; 9 Treatment of recoverable types of waste; 9 Reduction of greenhouse gas emissions; 9 Establishment of an integral and efficient waste management system.
For this purpose, it is necessary to: 9 Bring Croatian legislation into full compliance with the acquis, by adoption of the remaining sub-ordinate acts; 9 Provide for the enforcement of legislation; 9 Gradually increase the financial pressure on waste producers, in order for waste disposal to cease being a subsidised activity, by charging waste disposal using full application of the criteria of waste quantity and features and of the “polluter pays” principle; 9 Provide for the implementation of priorities pursuant to the legislation in waste management; 9 Reduce municipal waste volumes by the selective collection of waste and their processing into new products or energy; 9 Explore and implement the opportunities offered to reduce waste volumes generated in the construction sector.
Particular attention will be given to dealing with waste from islands (698 islands, of which only 47 are inhabited), as islands cannot be a place for final disposal; therefore, it is envisaged that transfer stations will be built on the islands so that the waste may be transferred to, and disposed on, the mainland.
The Waste Management Strategy comprises the evaluation of the current situation in waste management, a statement of the strategic and quantified goals and measures for achieving these goals, guidelines for waste management, and an assessment of investments and sources of finance. To achieve the goals set in the Strategy, the most important precondition is the planning, designing and construction of county/regional waste management centres; these would deal with municipal and industrial waste and begin the remediation and closure of landfill sites. The Waste Management Strategy was adopted in October 2005. The National Waste Management Implementation Plan was adopted in July 2007 and will be valid for the period of 8 years. The implementation plans for counties have been developed or are under development; these will be the strategic implementing documents. The waste sector projects on the indicative list in the EPOP are in compliance with the goals and measures in the Waste Management Strategy and with the National Waste Management Implementation Plan.
As identified in the SWOT analysis the relatively high number of public utility companies which are established on city/municipality level leads to fragmented waste management activities and results in sector inefficiency. A new concept for a county/regional level waste management system is envisaged by the National Waste Management Implementation Plan. The main feature of the new concept is the establishment of county/regional waste management centres which will be operated by a single company. Such a county/regional company will, in an
49 appropriate legal manner, join efforts with existing public utility companies to manage the waste management system for the whole county/region. According to the Plan, it is envisaged to establish up to 21 waste management centres. The Plan proposes and suggests to the counties, that wherever possible and viable, it would be preferable to establish waste management centres that would serve 2 or more counties.
2.2.2. Water management The national strategic objectives and priorities are defined in Croatia’s AP (short-term and medium-term priorities) and in the national strategic documents: the NPIEU, the PEP, the NEPS and the NEAP and Water Management Strategy.
According to adopted sociological assessments, Croatia’s population will stagnate, with a trend of migration towards larger settlements. This will be balanced by an expected growth in a number of economic sectors, of which the most relevant for the water sector are the sectors of agriculture, tourism, industry and transport. In settlements, the difference between the actual water supply and the wastewater collection is 36%, which means wastewater treatment poses a particular problem for water protection. Industrial growth and improvements in efficiency will result in a rise of not only water demands, but also increased wastewater discharges.
The average quantity and quality of available water resources in Croatia can satisfy the needs of all users. However, depending on the level of development and the functionality of infrastructure, there may be restricted access to water in specific places and at specific periods of time (e.g. tourism and agriculture in the summer months).
According to the Water Act, the objective of water management and administration is to achieve an integrated, coordinated water regime across the entire national territory and in each individual water district. This implies the management of spatial distribution, the construction of the water system and the state of water quantity and quality in a manner most suitable for a specific area and time. By joint activities of water management and municipal economies, the achievement of the following goals will be attempted: 9 Provision of sufficient quantities of quality drinking water for domestic water supply (settlements); 9 Provision of necessary quantities of quality water for various economic purposes; 9 Protection of people and material property against adverse effects of water; and 9 Protection and improvement of water status and water-dependant ecosystems.
Croatia is finalising the Water Management Strategy; this is the fundamental long-term strategic water management document at the national level (pursuant to the Water Act). It establishes a unified water management policy and an integral and coordinated approach to the improvement of the water system is defined, in line with the state, demand and services in the water system, as well reflecting international commitments. When developing this document, in addition to the Croatian water law and policy, certain provisions of the EU Water Framework Directive of 2000 and, whenever possible, basic European water policy principles were taken into account.
The Water Management Strategy of Croatia includes the: 9 Basis for the improvement of the legal, institutional and financial framework for water management activities; 9 Guiding document for devising integral water management; 9 Starting point for the development of other water management documents, especially River Basin Management Plans (RBMP); 9 Framework for the preparation of strategies and plans of physical planning, environmental protection and development of other sectors and fields depending on waters or having an impact on the state of water (agriculture, forestry, fishery, industry, energy, transport, tourism, public health, nature protection, etc.); and 9 National platform for regular water management operation, up to the adoption of RBMPs.
50 Four RBMPs (river basins of the: Sava, Drava and Danube, Primorje-Istria rivers, and Dalmatian rivers) should be completed by 2009. Croatia also participates in the Convention on the Protection and Sustainable Use of the Danube River, which is developing the RBM plan for the Danube River catchment area.
As identified in the SWOT analysis the relatively high number of public utility companies results in sector inefficiency. Therefore rationalisation needs to take place. According to the draft Water Management Strategy it is envisaged to gradually replace the existing system based on a large number of public utilities into a regionally based one.
Water supply The strategic objective of sustainable water use in Croatia is to provide sufficient water quantities of adequate quality, in compliance with planned needs, and to achieve the necessary level of water supply dependability for all users, including aquatic eco-systems and those connected with water. The general policy of raising the health and living standards of the population requires further development of the public water supply system. In this respect, it is necessary to create the conditions for the sustainability of water supply systems by providing sufficient water quantities of the necessary quality, achieving technical and technological efficiency and determining adequate water price. Therefore, the development objectives for public water supply are the following: 9 Effective protection of drinking water sources for public water supply (sanitary protections zones); 9 Provision of adequate water conditioning of drinking water in cases of inadequate water quality within water supply systems; 9 Reduction of water losses within public water supply systems to ensure the efficient operation of water supply systems, the rational use of water resources and a decrease in health risks; 9 Raising connection levels to water supply systems in areas with low connection levels; and 9 Increasing public water supply efficiency and reliability, with the introduction of an economic water price (polluter pays).
Water sewerage and treatment The strategic water protection objective is to preserve water quality and prevent the degradation of water, primarily for the purpose of preserving human health and the environment and achieving the good ecological status of water, in order to make it suitable for planned uses. Croatia will move towards this strategic objective incrementally; it is necessary to preserve surface waters and groundwater that are still clean (upper stretches of watercourses, highland watercourses and especially groundwater; these all belong to water quality class I) as a storage reserve for population supply and also to remedy or eliminate the pollution of waters for use by industry, agriculture, fish farming, recreation (according to the water classification, they belong to water quality class II).
Therefore, the focus should be on the protection of human health and ecosystems, with protected areas as a priority (sanitary protection zones of the source, fish farms, bathing areas, nature parks, national parks, etc.), which would be achieved through the following activities and measures: 9 The construction of wastewater treatment plants in settlements with existing sewerage networks; 9 Increasing sewerage connection and wastewater treatment levels in areas with developed water supply systems; 9 Repairing existing sewerage networks with significant permeability, which affect drinking water sources; 9 Increasing the efficiency and reliability of public sewerage and wastewater treatment systems, with the introduction of economic water price (polluter-pays principle).
51 3. PROGRAMME STRATEGY
3.1. PRIORITY AXES AND MEASURES
3.1.1. IPA objectives and priorities axes The IPA objectives and priorities are a subset of the national ones and they must reflect the strategic direction given in the AP, NES and NEAP. Nevertheless, because IPA has a much smaller scope, it is necessary to focus the EPOP's operations on more clearly defined objectives and priorities. Therefore, the overall objective for EPOP is to invest in those projects that will contribute the greatest impact with the limited resources available in the waste and water sub-sectors, whilst assisting Croatia meet its obligations for implementing the EU environmental acquis governing the treatment and disposal of waste, the supply of drinking water, collection, treatment and discharge of waste water, and also developing the administrative and management capacity of those institutions implementing the EPOP. Consequently, the EPOP will improve access to, and delivery of environmental services and facilities in the waste and water sub-sectors and also will produce other indirect development benefits out of IPA assistance, such as raising the quality of life of residents, attracting new productive investment and the creation of new jobs40.
The EPOP is divided into three priority axes: 9 Priority axis 1: Waste sub-sector - (i) providing waste management facilities in centres where they are needed most, (ii) remediation of the sites highly polluted by waste “hot spots”; 9 Priority axis 2: Water sub-sector - install modern water supply systems and (or) water treatment facilities and sewerage systems in those communities where: (i) drinking water supplies are most contaminated (ii) low levels of connection of population to the drinking water supply system, (iii) high losses in water supply network (iv) sewage treatment facilities will make the largest contribution to downstream water quality, (v) sewerage systems in settlements / communities where connection levels are below 75% and water supply connection level is high (vi) high permeability of the sewerage system and (vii) in sensitive areas and water protection zones; 9 Priority axis 3: Provide technical assistance (TA) to those IPA institutions managing the EPOP for programme management and capacity-building, preparing future Operational Programmes. An outline of these priorities is shown in the diagram below: EPOP objective (investment in infrastructure)
Priority Axis 1 Priority Axis 2 Priority Axis 3 Waste Water Technical Assistance
Waste Drinking water supplies Sewerage system in Sewage Capacity building management in communities: communities with: treatment facilities (a) high contribution to facilities Programme (a) where downstream water quality management Remediation of contamination is high sites highly polluted (b) low level of connection by waste (b) with low level of connections (c) high permeability (c) network suffering (d) sensitive areas& water from high losses protection zones
40 The opportunity for jobs creation is clearly visible based on the example of the establishment of packaging waste system, which has already resulted in new jobs creation
52 3.1.2. General Selection Criteria The aim of the EPOP will be achieved through implementation of projects which best fit the EPOP’s objectives. To be supported under the EPOP, projects should be financially, economically, socially, and environmentally sound. In order to utilise available IPA funds in a timely and effective manner maturity of the projects is paramount for the prioritisation of assistance. Besides complying with national strategic and planning documents, the projects should meet the following eligibility criteria and general modalities. Major projects will be prepared in accordance with articles 150 & 170 of the Implementing Regulation.
Eligibility criteria 9 Level of maturity of a project. i.e. it's readiness for implementation; 9 Scale of projects: projects / group of projects/ project phase(s) should reach an estimated minimum value of €10m (smaller projects may be eligible as well, pending on the funds available and if determined by relevant measure-related selection criteria; they will be assessed mainly through environmental benefits criteria and technical eligibility and justification, having in mind the total value); 9 Sustainability: projects must comply with EU norms and standards, be coherent with the sectoral policies of the EU, and must be (in case of waste management centres) financially sustainable to cover future operating and maintenance costs; 9 Conformity with the objectives and principles of EU environmental policy: ¾ Protection, maintenance and improvement of environmental quality, ¾ Protection of human health, prudent and rational use of natural resources, ¾ Precautionary principle, ¾ Prevention principle, ¾ Elimination at source principle, ¾ “Polluter pays” principle. 9 Alignment with the EU Environmental legislative requirements, with a particular focus on “investment heavy” directives with the intent of supporting alignment with the acquis; 9 Alignment with priorities set both in national strategic and EU documents; 9 Additionallity - that is, the project would not have gone ahead without EU assistance.
General modalities (might be also used to conduct the selection process for smaller projects that won’t be submitted to the EC for prior approval) 9 Continuity of community assistance, IFI assistance or other assistance, and previously identified investment priorities: i.e. investments and TA built on the previous support programmes (CARDS, DABLAS, PHARE, ISPA, IFIs etc.); 9 Projects to be from previously developed and agreed lists of national priority projects for each sector (these lists will be continually updated/modified in line with the development of project pipelines); 9 Projects which ensure the greatest impact and an immediate benefit upon completion (projects that cover biggest population, agglomeration, or area); 9 Eventual cross border / regional impact(s); 9 The level of contribution to achieving Croatia’s economic and social cohesion with the EU (projects with maximum potential economic and social benefits); 9 Relationship between the environmental and economic effectiveness of the projects - i.e. between the number of people affected and the project's costs. In the case of small projects in the water sub-sector, the impact will be incremental, and therefore significant, over the lifetime of the programme, rather than at an individual project level;
53 9 Institutional and administrative framework for management / implementation of project (mainly in relation to the level of the Final Beneficiary (-ies) commitment.
Revenue generating projects Revenue generating projects as defined in the Article 150 of the IPA Implementing Regulation are operation(s) proposed for pre-accession assistance involving an investment in infrastructure, the use of which is subject to charges borne directly by users and which generates revenues, or any operation involving the sale or rent of land or buildings.
3.1.3. PRIORITY AXIS 1 – DEVELOPING WASTE MANAGEMENT INFRASTRUCTURE FOR ESTABLISHING AN INTEGRATED WASTE MANAGEMENT SYSTEM IN CROATIA
Aim The aim is to establish an integrated waste management system by developing waste management infrastructure - construction of waste management centres at county and regional levels and the remediation of sites highly polluted by waste, which will contribute to the protection of the environment and human health. Community legislation Activities under this priority axis are designed to improve waste management and assist Croatia in meeting its obligations related to implementation of the EU environmental acquis governing the disposal of waste, namely: 9 Directive 2006/12/EC on waste, 9 Waste Landfill Directive 1999/31/EC. Provisions of the Directive 2006/12/EC have been fully transposed in Croatian legislation and Waste Landfill Directive 1999/31/EEC will be fully transposed with adoption of Ordinance pursuant to the Waste Act in course of 2007. Specific objectives The objectives of this priority are to: 9 Construct waste management infrastructure with a focus on the construction of waste management centres (separation of waste by categories, treatment with aim to reduce biological component of waste, landfill for final disposal of residues) which will replace existing landfills; thus improving access to, and delivery of environmental services and facilities in waste management; 9 Remediate and close sites highly polluted by waste; 9 Prepare technical documentation (i.e. feasibility studies, environmental impact assessments, financial and economic analyses, cost-benefit analyses, affordability studies, preliminary designs, tender documents etc.) that will support the pipeline of projects for waste management investments. Rationale In Croatia there are a great number of municipal waste landfills, most of which do not comply with set standards, what is considered to be the result of an undeveloped waste management system.
Croatia inherited a large number of illegal dumpsites which are estimated at around 3,000, of which 1% pose significant pollution threat; and a number of sites highly polluted with waste- hot spots. The major part of industrial waste (inert and hazardous) is deposited at landfills within the industrial area and installations.
Croatia will comply with its obligations for future EU membership by developing an integrated waste management system, in accordance with the National Waste Management Strategy and National Waste Management Implementation Plan and county waste management plans and EU legislation. This will be realised by using different domestic and international resources and financial models. An integrated waste management system is already being introduced through support from national sources and the ISPA programme.
54 The Croatian framework waste management legislation is in place; sub-ordinate legislation for different waste streams, landfilling, incineration has been adopted or is under preparation. Full transposition of waste related acquis is planned to be completed in 2008 and the implementation of transposed provisions will require substantial efforts.
This priority, i.e. development of the waste management infrastructure through concept of “integrated waste management”, will therefore aim at achieving the requirements of EU legislation and at establishing an adequate and sustainable waste management system.
In addition Croatia is fully aware of the difficulties that new Member States have encountered in absorbing the allocation of Structural Funds due to the inadequate and unprepared project pipeline. Therefore the preparation of sufficient, well designed and mature projects will ensure use of EU assistance in timely and technical manner. Description The following indicative types of activities are envisaged for funding under this priority axis: 9 Construction of new county/regional waste management centres; 9 Construction of facilities for sorting, recycling and biological treatment; adequate facilities for handling hazardous waste and other specific waste streams; selective collection systems; 9 Remediation of sites highly polluted by waste in the karst area that pose a significant risk of contamination to ground waters; 9 Project pipeline preparation for previously identified projects. Targeting This priority axis will apply to the waste management sub-sector of the EPOP, contributing to the EPOP’s objective “Improve access to, and the efficient delivery of, environmental services and facilities in the waste and water sub-sectors”. The priority axis is targeted at: 9 Improvement of access to, and delivery of environmental services and facilities in the waste sub-sector; 9 Protection of ground water and human health; 9 Assisting Croatia in meeting its obligations to implement the EU environmental acquis governing the disposal of waste. The main beneficiaries of the interventions under this priority axis will be municipal/ county/ regional companies or other public bodies dealing with waste management, but also the line ministry (Ministry of Environmental Protection, Physical Planning and Construction). Measures Two measures are proposed under this priority axis: 9 Measure 1.1. Establishment of new waste management centres at county/regional levels Projects under this Measure will provide for construction of new waste management centres, replacing local waste landfills, and other facilities necessary for an integrated waste management system. 9 Measure 1.2. Remediation of sites highly polluted by waste (hot spots) Projects under this Measure should eliminate the threat that contaminated land and sites pose to ground water and to human health.
Delivery The operations (projects) that will be financed under Priority axis 1 will be selected from the Indicative project list provided in Chapter 3.5 of the Operational Programme (and respective project identification cards attached as Annex III) in accordance with the general and sub-sector (measure) specific selection criteria provided in the Operational Programme. The selected operations will then be submitted to the European Commission for approval. If a project is appraised as acceptable the European Commission will issue a decision on approval for each project which will define the physical object and the eligible expenditure to which the co-financing rate for the priority axis applies. At the end
55 for each approved project a Financing Agreement between the European Commission and the beneficiary country will be signed laying down those elements. Complementary funding for these investments will be ensured from national funding, external loans and other sources and models of funding. In the case of projects that do not fall under the title “major projects” (i.e. that are under 10 m€ threshold) the decision about competing calls will be made by the Selection Committee, based on the selection criteria described in the Operational Programme and confirmed by the Sectoral Monitoring Committee. Targets and indicators The table below outlines the priority’s core indicators:
Table 3.1: Indicators for evaluation for Priority axis 1 - Developing waste management infrastructure for establishing an integrated waste management system in Croatia Indicator Unit Baseline data Final target Frequency of Data source (year) reviewing Result Population served by the new 0 MEPPPC, final Number 940,000 3-years period waste management centres (2007) beneficiary
Reduction of waste deposited 0 MEPPPC, final in the landfills % 30 3-years period (2007) beneficiary
Financial allocation and co-financing rate Out of the total allocation for the Environment OP that amounts in total 53,499,750 € (16,999,500 € in 2007, 18,000,000 € in 2008 and 18,500,250 € in 2009), the allocation for Priority Axis 1 is 8,349,750 € in 2007, 8,874,750 € in 2008 and 9,125,250 € in 2009 (total 26,349,750 €). For the waste management sector the IPA co- financing rate is set at 75%.
3.1.3.1. Measures under Priority Axis 1 - Developing waste management infrastructure for establishing an integrated waste management system in Croatia
Measure 1.1 – Establishment of new waste management centres at county / regional levels
Specific objective Construction of waste management infrastructure with a focus on the replacement of existing landfills within new waste management centres along with the facilities for separation and sorting, recycling and biological treatment of waste; thus improving access to, and delivery of environmental services and facilities in waste management. Rationale Waste disposal facilities in most of the municipalities are inadequate There is a great number of municipal waste landfills, most of which operate without valid permits. Scattered, non-compliant landfills along with the lack of waste treatment facilities are an obstacle for the establishment of an integrated waste management system. New waste management centres as the central point of waste management at a county/regional level will enable achieving the requirements of EU legislation establishing an adequate and sustainable waste management system. Description Projects under this measure will provide facilities for waste disposal within the new waste management centres, replacing numerous municipal waste landfills, and providing other facilities necessary for an integrated waste management system.
Since replacing existing landfill sites with new waste management centres is one of the key building blocks of the new county/regional waste management system, care must be taken, that those (existing) landfill sites should be closed as soon as possible following the completion of the new waste management facility.
56 Eligible actions Assistance under this measure refers to procurement contracts (supervision services, implementation support, tender evaluation, consultancy, project preparation for already identified projects (including inter-alia feasibility study; social and economical appraisal and cost benefit analyses, technical design drawings, bills of quantities and tender documents, project monitoring and evaluation). More specifically activities under this measure are aimed at the construction of new municipal waste landfills; facilities for treatment, recycling and composting; equipment for the transport of waste; facilities for adequate disposal of other specific waste streams and other facilities for the development of an integrated waste management system. Selection criteria The projects under Measure 1.1 will ensure meeting the National Waste Management Strategy goal of establishing up to 21 new waste management centres at county / regional level and will be ranked according to the following criteria:
Criteria I - waste management systems in coastal counties with islands. There are seven such counties: Lika- Senj (53,677 population), Sibenik-Knin (112,891), Dubrovnik-Neretva (122,870), Zadar (162,045), Istria (206,344), Primorje-Gorski kotar (305,505), and Split-Dalmatia (463,676).
Criteria II - waste management systems in counties of over 200,001 residents or in other areas serving over 200,001 users. There are eight such areas, including the capital and two groups of counties: Zagreb (population 779,145), North-West Croatia (570,460), Eastern Slavonia (535,274), Split-Dalmatia (463,676), Osijek-Baranja (330,506), Primorje-Gorski kotar (305,505), Istria (206,344), and Vukovar-Srijem (204,768).
Criteria III - waste management systems in counties from 150,000 to 200,000 residents or in other areas serving from 150,000 to 200,000 users. There are four such counties: Zadar (population 162,045), Slavonski Brod- Posavina (176,765), Varazdin (184,769) and Sisak-Moslavina (185,387).
Criteria IV - waste management systems in counties with up to 150,000 residents or in other areas serving up to 150,000 users. There are three such counties: Lika-Senj (53,677), Pozega-Slavonia (85,831), Virovitica- Podravina (93,389) and Karlovac (141,787).
The viability of projects seeking IPA funding will be appraised on the basis of the following issues: 9 New waste management centres and waste disposal sites must comply with the National Waste Management Strategy, National Waste Management Implementation Plan, county waste management plans and county spatial plans; 9 Projects will be in those areas where the existing waste landfills create a ground water hazard; 9 Projects will be in those areas where the landfills are running out of capacity; 9 Presence of adequate administrative and institutional framework (this, inter alia, will help to ensure that the Polluter Pays Principle is fully observed); 9 Projects for new waste management centres should review the choice between extending the existing waste disposal sites or building new facilities and protecting the sensitivity of the groundwater or other receptors in the region (i.e. will the project help to prevent damage to human health or the environment in a sensitive zone); and 9 A rational and economically viable structure of the future operating company. The project should also be appraised in terms of the distance between the planned/modernised landfill and local towns, in line with the principle of reducing the amount of waste transported (optimisation of transport costs). Final beneficiary The expected beneficiaries of Measure 1.1 are municipal/ county/ regional companies or other public bodies dealing with waste management but also the line ministry (Ministry of environmental protection, physical planning and construction).
57 Monitoring indicators Table 3.2: Indicators for monitoring & evaluation for Measure 1.1 – Establishment of new waste management centres at county / regional levels Indicator Unit Baseline data Final target Frequency of Data source (year) reviewing Outputs Established (opened) new waste MEPPPC management centres 0 Project Number 3 annually (2007) monitoring reports Project application submitted MEPPPC, with full documentation 0 Project Number 3 annually (2006) monitoring reports
Measure 1.2 –Remediation of sites highly polluted by waste ( hot spots)
Specific objective Protection of the environment and human health by the remediation of sites high polluted by waste. Rationale Sites highly polluted by waste - hot spots - are a result of a long-lasting period of inappropriate production and (technological) waste management. The waste (primarily hazardous waste) was dumped in depressions, excavations and other inadequate sites. Those sites pose a risk both to the environment and human health. There are nine “hot spot” sites which are determined as priorities41.
For the remediation of nine priority “hot spots”, the Environmental Protection and Energy Efficiency Fund (EPEEF) has allocated €22m for the 2005-2008 period.
Description Projects under this measure should eliminate the threat that contaminated land and sites pose to ground water and to human health. Eligible actions Assistance under this measure refers to procurement contracts (supervision services, implementation support, tender evaluation, consultancy, project preparation for already identified projects (including inter-alia feasibility study; social and economical appraisal and cost benefit analyses, technical design drawings, bills of quantities and tender documents, project monitoring and evaluation). More specifically activities under this measure are aimed at the remediation of sites highly polluted by waste including the adequate disposal of dumped waste. Selection criteria The priority projects under this measure should relate to those sites highly polluted by waste that pose a threat to underground water and to human health, especially in relation to the karst areas, since ground water provides 90% of drinking water supplies in Croatia. In addition and following the general selection criteria priority will be given to projects with the highest maturity level, ones which effect the environment in the most damaging way and that will provide maximum impact from the funds. Final beneficiary The expected beneficiary of Measure 1.2 is the Ministry of Environmental Protection, Physical Planning and Construction.
41 For the list of „hot spot“ sites see Chapter 2.12. „Description of waste management sub-sector“.
58 Monitoring indicators Table 3.3: Indicators for monitoring & evaluation for Measure 1.2 – Remediation of sites highly polluted with waste (hot spots) Indicator Unit Baseline data Final target Frequency of Data source (year) reviewing
Outputs
MEPPPC Documentation for “hot spot” 0 Number 1 annually Project remediation projects prepared (2007) Monitoring Reports
3.1.4. PRIORITY AXIS 2 – PROTECTING CROATIA’S WATER RESOURCES THROUGH IMPROVED WATER SUPPLY AND INTEGRATED WASTE WATER MANAGEMENT SYSTEMS
Aim The overall aim is to develop a water management system in relation to both drinking and waste water and, by doing that, to protect Croatia’s water resources and comply with EU standards. Community legislation Activities under this priority axis are designated to improve the water management system and assist Croatia to meet its obligations in relation to the EU aquis governing water management, namely the following most important Directives: 9 Water Framework Directive (2000/60/EC) 9 Urban Waste Water Treatment (UWWT) Directive (91/271/EEC, 98/15/EC) and 9 Drinking Water Directive (80/778/EEC, 91/858/EEC, 90/656/EEC and 91/692/EEC)
Croatian legislation in the water sector is expected to be in line with the acquis by 2008 Specific Objectives The objectives of Priority Axis 2 are to: 9 Provide adequate water and sewerage services, at accessible tariffs; 9 Improve and protect the purity and quality of groundwater and soil in sensitive areas; 9 Prepare technical documentation (i.e. feasibility studies, environmental impact assessments, financial and economic analyses, cost-benefit analyses, affordability studies, preliminary designs, tender documents etc.) that will support a pipeline of projects. Rationale This priority addresses one of the main weaknesses identified in the SWOT analysis reflecting the poor rate of connection of communities to basic water infrastructure (only 12% of waste water generated by the population is treated), and the lack of sewerage collection and treatment facilities in some areas.
Public water and sewerage services are often inefficient due to the large number of small operators, and long- term under-investment and poor management. This is being addressed by the introduction of strategic planning, long-term objectives and business plans in the water sector.
Croatia is committed to complying with the water sector component of the EU environmental acquis. Croatian legislation in the water sector is expected to be in line with the acquis by 2008, but in addition to legislation alignment, a high level of investment will be needed, particularly in the waste water sector.
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According to the decision on “sensitive areas” the exact level of investments will be determined due to the fact that agglomerations of more than 10,000 p.e. in those areas should have waste water treatment plants providing an advanced treatment level (nitrogen and phosphorus removal), which will, of course, raise the level of investments needed. In rural areas, where 54% of the population lives and most settlements don’t have adequate facilities, groundwater is susceptible to contamination from untreated wastewater. Therefore small- scale wastewater treatment plants must be built to protect the groundwater reserves.
Priority will be given to large scale integrated projects in order to optimise the investment and operational costs induced by such investments. The long-term investment programme has identified 29 priority investments that will be targeted to provide settlements of over 50,000 p.e. with adequate water and wastewater utilities42. The investment needs will be prioritised to also take into account the commitments assumed by Croatia during the negotiation process, mainly in urban agglomerations in the first phase. However, for IPA, the strategy is to focus on those communities where the greatest impact may be made within the limited resources available. Rural agglomerations can also be integrated within a regional project if a significant environmental impact can be justified and/or cost-efficient components improve the sustainability of the overall investment.
Technical assistance is available under CARDS, Phare, DABLAS, ISPA and IPA for potential beneficiaries, who wish to improve their capacity to prepare projects for future EU funding.
Croatia recognises that EU funds will be insufficient for compliance with the EU water sector acquis. Other sources of finance will be sought and potential beneficiaries are encouraged to consider innovative financial engineering solutions such as public-private partnerships incorporating design-build-operate (DBO) schemes. This priority axis has been designed to assist beneficiaries from local authorities at regional / county / municipal levels.
IPA will continue the major investment programme required to assist Croatia meet her obligations for future EU membership and will contribute to readdressing past underinvestment.
In addition Croatia is fully aware of the difficulties that new Member States have encountered in absorbing the allocation of Structural Funds due to the inadequate and unprepared project pipeline. Therefore the preparation of sufficient, well designed and mature projects will ensure use of EU assistance in a timely and technical manner. Description The following indicative types of activities are envisaged for funding under this priority axis: 9 Construction/refurbishment of water supply networks and investments in water treatment; 9 Construction/refurbishment of waste water networks; 9 Construction of waste water treatment plants; 9 Refurbishment/upgrading of existing waste water treatment plants; 9 Project pipeline preparation for previously identified projects. Targeting This priority axis will apply to the water management sub-sector of the Environmental OP contributing to the EPOP’s objective to “Improve access to, and the efficient delivery of, environmental services and facilities in the waste and water sub-sectors”. The priority axis is targeted at: 9 The improvement of access to, and delivery of environmental services and facilities in the water sub-sector; 9 The protection of water resources; 9 Assisting Croatia in meeting her obligations to implement the EU environmental acquis governing water management.
42 Annex D-5 to the Croatian National Water protection Plan, OJ 8/99
60 The main beneficiaries of the interventions under this priority axis will be county / municipal companies or other public bodies dealing with water management, but also the line ministry (Ministry of Agriculture, Forestry and Water Management). Measures 9 Measure 2.1. Establishment of modern water supply and networks 9 Measure 2.2. Construction of WWTP for domestic and industrial wastewater and upgrading the sewerage network
There are two main measures under this priority, the first concentrates on providing modern drinking water supply networks, and the second will provide wastewater treatment facilities and sewerage networks.
The EPOP (through the specified measures) will concentrate on the upgrading and construction of water supply, sewerage networks and WWTPs, through projects that will focus on: 9 Providing integrated solutions to wastewater issues in the settlements, contribute to the aligning with Urban Waste Water Treatment Directive (91/271/EEC, 98/15/EC) and other relevant EU directives; 9 Improvement of wastewater treatment levels by constructing treatment plants; 9 Reduction of leakages (both in water supply and sewerage networks); 9 Increasing the level of connections to water supply and sewerage systems. The EPOP will focus on the establishment / improvement of drinking water and sewerage / treatment facilities in the areas of the country where: 9 Drinking water supplies are most contaminated and areas with low connection levels of the population to the drinking water supply system; 9 There are high losses in the water supply network; 9 Sewage treatment facilities will make the largest contribution to downstream water quality; 9 Sewerage systems in settlements / communities where connection levels are below 75%; and in areas with developed water supply systems; 9 There is high permeability in the sewerage network, especially when it affects drinking water sources; 9 Provide micro wastewater treatment projects in settlements with less than 5,000 p.e., where there is a significant risk to the quality of recipient waters in sensitive areas and water protection zones. In this respect, it should be noted that 50% of Croatia’s population live in settlements with less than 7,000 people.
A national register of all wastewater treatment facilities has been prepared and a similar register of water supplies is being prepared. However, these registers are not compatible with the WFD / Urban Waste Water Treatment Directive. Therefore, a comprehensive list of settlements or agglomerations of settlements, that will reflect the requirements of the WFD, is being prepared and will be completed by the end of 2007.
Wastewater Treatment and drinking water projects within the Adriatic River Basins are already subject of relevant framework assistance / projects (WWT projects are supported by World Bank’s “Coastal Cities Pollution Control Project”- costal area and “Inland Water Project” - inland area of Adriatic River Basin and drinking water projects are financed by the State Budget and partly by IFIs through the relevant framework project).
The greatest problems with water quality standards are in the Black Sea catchment area; therefore, the majority of proposed projects are designed to improve sewerage and wastewater treatment systems in this river basin. The towns and settlements in the catchment area are developing plans to reduce untreated discharges and protect drinking water sources.
Due to the rather limited EU budget allocated in this EPOP, activities related to water management are concentrated on the improvement of water supply and wastewater treatment infrastructure. However, investment in water infrastructure could also be seen as an opportunity for the improvement of Croatian scientific and
61 technological capacity. This could be achieved through the support and participation of Croatian researchers and technical staff in the major (water related) EU funded projects, by supporting the creation and development of a national exchange platform (including all relevant stakeholders) in order to ensure effective public/private partnership. In addition the involvement of Croatian scientists and researchers could be used to support activities conducted under the Water Supply and Sanitation Platform, as one of the technology platforms set up within the European Environmental Technology Action Plan. Delivery The operations (projects) that will be financed under Priority Axis 2 will be selected from the Indicative project list provided in Chapter 3.5 of the Operational Programme (and the respective project identification cards attached as Annex III) in accordance with the general and sub-sector (measure) specific selection criteria provided in the Operational Programme. The selected operations will then be submitted to the European Commission for approval. If a project is appraised as acceptable the European Commission will issue a decision on the approval for each project which will define the physical object and the eligible expenditure to which the co-financing rate for the priority axis applies. At the end for each approved project a Financing Agreement between the European Commission and the beneficiary country will be signed laying down those elements. Complementary funding for these investments will be ensured from national funding, external loans and other sources and models of funding.
In the case of projects than do not fall under the category of “major projects” (i.e. that are under 10 m€ threshold) the decision about competing calls will be made by the Selection Committee, based on the selection criteria described in the Operational Programme and confirmed by the Sectoral Monitoring Committee. Targets and indicators The table below outlines the priority’s core indicators:
Table 3.4.: Indicators for evaluation of Priority axis 2 - Protecting Croatia’s water resources through improved water supply and integrated waste water management systems Indicator Unit Baseline data Final target Frequency of Data source (year) reviewing Results Population connected to 0 rehabilitated water supply Number 100,000 * 3-year period MAFWM (2007) network Population connected to new / 0 rehabilitated sewerage Number 105,000 PE* 3-year period MAFWM (2007) network
Population served by the 0 WWTP Number 105,000 PE* 3-year period MAFWM (2007) * direct and indirect effect
Financial allocation and co-financing rate Out of total allocation for the Environmental OP that amounts in total to 53,499,750 € (16,999,500 € in 2007, 18,000,000 € in 2008 and 18,500,250 € in 2009), the allocation for Priority Axis 2 is 8,400,000 € in 2007, 8,900,250 € in 2008 and 9,150,000 € in 2009 (total 26,450,250 €). For the water management sector the IPA co- financing rate is set at 75%.
62 3.1.4.1. Measures under Priority Axis 2 – Protecting Croatia’s water resources through improved water supply and integrated waste water management systems
Measure 2.1 – Establishment of modern water supply systems and networks
Specific Objectives The extension of the public water supply network, with a focus on rehabilitating the existing decrepit networks and the construction of new ones, would integrally solve and upgrade the drinking water supply to the population by means of a public water supply system. Rationale The conducted analyses of the present state of the sector and development needs showed that Croatia has sufficient water quantities available for its needs, and that the water resources in terms of their quality and quantity are not a limiting factor of economic development. Water management requires systematic investments into the development and regular maintenance of water systems. The main goal of water estate management is the provision of sufficient quantities of quality drinking water for the population, the provision of necessary water quantities of adequate quality for various economic uses, the protection of people and material property from floods and other forms of adverse effects of water, the achievement and maintenance of good water status for the purpose of the protection of aquatic and water-related ecosystems. The strategic goal of public water supply development is to increase the level of population water supply from public water supply systems, in line with the European standards. Additionally, there is a planned intensification of activities on the determination of sanitary protection zones of the source and the implementation of appropriate protective measures, and also an intensification of activities on upgrading drinking water treatment in accordance with the requirements of the EU Drinking Water Directive, as well as the intensification of activities on reducing losses from water supply distribution networks. Description The projects within this measure will be a vehicle for the construction of new water supply network facilities, the rehabilitation of decrepit facilities and equipment, and thus modernising the existing water supply systems of settlements in order to meet EU regulations and standards. Eligible Actions Assistance under this measure refers to procurement contracts (supervision services, implementation support, tender evaluation, consultancy, project preparation for already identified projects (including inter-alia feasibility studies; social and economical appraisals and cost benefit analyses, technical design drawings, bills of quantities and tender documents), project monitoring and evaluation). More specifically activities under this measure are aimed at the construction of new water supply networks and rehabilitation of the existing ones, with the purpose of developing integrated water supply systems for settlements. Actions within in this measure could also relate to the inspection, operation and monitoring of water supply facilities. If appropriate the participation of Croatian research and scientific staff in major EU funded (drinking water) projects could be encouraged and through this a national exchange platform43and an interface between the Croatian scientific and Water Supply and Sanitation Technology sectors could be created. Selection criteria In accordance with the Drinking Water Directive and IPA and national priorities, preference will be given to drinking water supply and water treatment projects:
Criteria I – providing / upgrading water supply networks and an appropriate level of water treatment for agglomerations44 of at least 50,000 p.e. (with preference given to the largest agglomerations45), the projects in counties with low water supply system connectivity levels will have priority;
43 That will include researches, technology oriented SMS, regulators, policy makers and other relevant stakeholders on national level in order to ensure and effective Public/private partnership. 44 An 'agglomeration' means an area where the population and/or economic activities are sufficiently concentrated for urban waste water to be collected and conducted to an urban waste water treatment plant or to a final discharge point, (directive 91/271/EEC).
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Criteria II - providing / upgrading water supply networks and an appropriate level of water treatment for agglomerations from 15,000 to 50,000 p.e.;
Criteria III - providing / upgrading water supply networks and an appropriate level of water treatment for agglomerations from 2,000 to 15,000 p.e. in sensitive areas.
Specifically projects will be selected upon the basis of: 9 Large agglomerations (i.e. preference for those projects benefiting the greatest number of inhabitants); Large projects should provide integrated solutions i.e. complete water supply systems including reservoirs, treatment plants, distribution pipelines and be targeted at communities where the level of connection to the mains water supply network is low; 9 Reduction of network water losses to ensure greater efficiency of the existing water distribution system; 9 Regions with water-related health problems; 9 Being located in regions with scarce water resources (dry climates, over-exploitation of aquifers) or important quality problems (e.g. surface water pollution, aquifer salination; 9 Small projects should concentrate on existing water supplies that do not meet quality standards; 9 A rational and economically viable structure of the future operating company;
Community quality standards for drinking water must also be taken into account when considering the design of the project and aspects that are eligible for IPA support.
Projects should include solutions that ensure efficient use of resources by charging for resource use (abstraction of water) e.g. a tariff system46 (linked to the level of consumption), leakage control and metering (though due account should be given to the affordability for end users). Final Beneficiaries The expected beneficiaries of Measure 2.1 are local / regional / municipal companies or other public bodies dealing with water related activities, but also the line ministry (Ministry of Agriculture, Forestry and Water Management). Monitoring Indicators Table 3.5: Indicators for monitoring & evaluation for Measure 2.1 – Establishment of modern water supply systems and networks Indicator Unit Baseline data Final target Frequency of Data source (year) reviewing Outputs MAFWM 0 Municipal New water supply networks km 7 (2007) annually companies, project monitoring reports MAFWM Rehabilitated / replaced water 0 annually Municipal km 20 supply network (2007) companies, project monitoring reports Water supply projects MAFWM, Project 0 annually applications submitted with full Number 2 monitoring reports (2006) documentation
45 A list of all agglomerations over 50,000 p.e. is part of the national Water Protection Plan (Official Gazette 8/99) 46 When applying the polluter pays principle should be observed, tariffs paid by the users should at least cover operational and maintenance costs and provisions for equipment replacement (though due account should be given to the affordability of charges by households).
64 Measure 2.2 – Construction of WWTP for domestic and industrial wastewater and upgrading the sewerage network
Specific Objectives The construction and reconstruction of public systems for urban wastewater collection and treatment, including an increase in population connection levels to public sanitation systems, which will fulfil the key requirements of the EU Urban Wastewater Directive. Rationale As stated Croatia has sufficient water quantities available for its (both public and economic) needs. However, further effort needs to be made in the field of protecting the environment and drinking water sources through a reduction in the amount of untreated sewage being deposited in Croatian water courses. The strategic goal of water protection is the intensive construction and reconstruction of urban wastewater sewerage and treatment systems and to increase the percentage of the population connected to public sewerage systems, with the aim of meeting the key requirements of the EU Urban Wastewater Treatment Directive. This measure has the aim of fulfilling the above stated goals. Description The projects within this measure will be a vehicle for the construction of new public sanitation systems, the rehabilitation of decrepit facilities and equipment, the construction of urban wastewater treatment plants, and thus modernising the existing sanitation systems in order to fulfil the requirements of EU regulations and standards. Eligible Actions Assistance under this measure refers to procurement contracts (supervision services, implementation support, tender evaluation, consultancy, project preparation for already identified projects ((including inter-alia feasibility studies; social and economical appraisals and cost benefit analyses, technical design drawings, bills of quantities and tender documents), project monitoring and evaluation). More specifically the activities under this measure are aimed at the construction of urban wastewater collection facilities and treatment systems, with the purpose of developing an integrated solution to urban wastewater problems. The actions within in this measure could also relate to the inspection, operation and monitoring of water treatment facilities. If appropriate the participation of Croatian research and scientific staff in major EU funded (drinking water) projects could be encouraged and through this a national exchange platform47 and an interface between the Croatian scientific and Water Supply and Sanitation Technology sectors could be created Selection Criteria The extension / modernisation and construction of wastewater infrastructure in agglomerations with more than 50,000 p.e.; and the improvement of wastewater infrastructure in agglomerations of less than 5,000 p.e. in areas where groundwater’s are at risk, through a small project facility, are the type of operations through which major interventions (measures) – construction/upgrading of wastewater treatment plants and extension/rehabilitation of water and sewerage networks - will be achieved.
Projects under Measure 2.2 will be ranked according to the following criteria:
Criteria I – those ensuring collection systems (including both upgrading and construction of sewerage systems) and an appropriate level of sewage treatment for agglomerations of at least 50,000 p.e., There are approximately 30 agglomerations in this category (preference given to the largest agglomerations);
Criteria II - ensuring collection systems and an appropriate level of sewage treatment for agglomerations from 15,000 to 50,000 p.e.; and
Criteria III - ensuring collection systems and appropriate level of sewage treatment for agglomerations from 2,000 to 15,000 p.e. Specific consideration will be given to small water treatment facilities for settlements with an impact on sensitive areas and potential Natura 2000 sites.
47 That will include researches, technology oriented SMS, regulators, policy makers and other relevant stakeholders on national level in order to ensure and effective Public/private partnership.
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In addition, in accordance with the Urban Waste Water Directive (91/271/EEC), priority will be given to: 9 Projects where larger numbers of inhabitants will be served. Unless part of a larger scheme, settlements (or agglomerations) should be greater than 5,000 people, unless in sensitive areas and potential Natura 2000 sites. Priority will be given to larger settlements or groups of settlements where project preparation/documentation is complete; 9 Agglomerations discharging into “sensitive areas” should also be given priority for treatment. (A sensitive area can be defined by each country and/or in accordance with the Water Framework Directive).
Unless in a “sensitive area”, such as a water protection zone or special protection areas, secondary / biological treatment should be adopted, but in such “sensitive” areas more stringent treatment (Art. 5) sufficient to reduce the phosphorous and nitrogen load can be expected. (If several such projects are proposed, priority should be given to those that provide wastewater treatment that gives the greatest degree of positive environmental impact). Such areas are where: 9 The receiving waters are in areas of protected biodiversity (potential Natura 2000 etc.); 9 The receiving waters provide drinking water; 9 Wastewater treatment is likely to result in substantial economic benefits (e.g. agriculture, fishing, tourism).
When designing a project, the following should also be taken into account: 9 Projects should be designed in order to achieve the treatment standards laid down in the UWW Directive and adequate monitoring systems to monitor these standards; 9 Institutional and legal provisions should be in place at municipal level to ensure that industrial waste water discharges into the municipality sewage network are pre-treated (as these waters are frequently toxic and difficult to treat by normal methods); 9 Sludge treatment and its final destination is made respecting community waste legislation; 9 Possible impacts on potential Natura 2000 sites; 9 A rational and economically viable structure of the future operating company. Final Beneficiaries The expected beneficiaries of the Measure 2.2 are the local / regional / municipal companies or other public bodies dealing with waste water (sewerage) related activities but also a line ministry (Ministry of Agriculture, Forestry and Water Management). Monitoring Indicators Table 3.6: Indicators for monitoring & evaluation for Measure 2.2 – Construction of WWTP for domestic and industrial wastewaters and upgrading of the sewerage network Indicator Unit Baseline data Final target Frequency of Data source (year) reviewing Outputs MAFWM New/rehabilitated WWTP 0 Municipal Nr 3 annually compliant with EU aquis (2007) companies, project monitoring reports MAFWM Sewerage network construction / 0 Municipal km 50 annually refurbishment (2007) companies, project monitoring reports Waste Water project applications MAFWM, Project 0 annually submitted with full Number 4 monitoring reports (2006) documentation
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3.2. PRIORITY AXIS 3 - TECHNICAL ASSISTANCE
Aim The aim of the TA priority axis is to ensure that Croatia is able to administer the Environmental Protection Operational Programme, through all aspects of programme management. Objective Ensure efficient and effective OP management, and develop institutional capacity for project preparation, management and absorption of IPA and future Structural Funds. Rationale Croatian programme and project management capacity – from design through commissioning to operation – is evolving at the national, regional and local levels, supported in recent years by 76 technical assistance and twinning projects under PHARE, CARDS and bilateral assistance. This practical experience will continue to grow and become embedded in future years, as more projects come on-stream.
Management of IPA, and specifically, this OP, will involve extraordinary costs that do not form part of the Croatian administration’s traditional operating expenses. This includes: information & publicity on IPA; the development of monitoring indicators and an EU funds Management Information System; training for Croatian national and regional bodies in the preparation of project applications for EU assistance funds; the commissioning of external, independent experts for interim and ongoing evaluations; and the costs of managing and implementing the IPA programmes.
Moreover, IPA is designed as a pre-cursor to Structural and Cohesion Funds, and it is essential that Croatia develops the capacity to implement these funds. IPA is an opportunity to learn how to manage funds according to EU rules, and to build sustainable institutional structures, systems and skills for the transition to Structural Funds. Description The types of actions under this priority axis will fall under two main themes:
i. Specific, tailored support to coordinate and manage the OP, including programming, information and publicity, training in the preparation of EU project funding applications, project identification, appraisal and selection, implementation, financial management, control, monitoring, evaluation, reporting, audit, revisions of existing Operational Programmes and the preparation of Operational Programmes and the identification of projects for the next funding period;
ii. Aid to enhance the specification, collection and use of statistics, which will be necessary for effective monitoring and evaluation under IPA and, subsequently, the Structural Funds.
The activities will be largely specified and prescribed in the annual TA plan. The service and supply contracts will be awarded through competitive tender according to EU procurement rules and will be managed by the Central Finance and Contracting Agency for EU Programmes and Projects and the successful tenderer chosen by the Selection Committee.
67 Targets and indicators Table 3.7: Indicators for evaluation for Priority axis 3: Technical assistance
Indicator Unit Baseline data Final Frequency of Data source (year) target reviewing
Results
Staff in the national bodies capable of independently identifying, 0 MEPPPC, Nr 40 3-year period preparing and assessing project (2007) MAFWM applications
OP funds absorbed 0 MEPPPC, % 100 3-year period (2007) MAFWM
Measure 3.1 – OP management and capacity building
Specific Objectives The specific objective for this measure is to ensure efficient and effective OP management, and develop the institutional capacity for managing and absorbing IPA.
Rationale One of the principal goals of implementing IPA is to build administrative capacity, and hence it is essential that Croatia is provided support to identify, train, develop and retain a body of skilled and motivated staff, working with effective systems and procedures for sound programme management. Therefore it is necessary to develop a sufficient pool of national expertise in the preparing and assessing of projects for future implementation thereby reducing the unit costs (and time) in preparing funding applications through a reduction in the use of external consultants. This will ensure both the successful management of IPA and a smooth transition into the still greater challenge of Structural Funds programming and the management of a portfolio of potentially thousands of projects. Description Through this measure support to the Operating Structure i.e. bodies dealing with the implementation of the Priority axis 1 and Priority axis 2 will be provided. That support will include training activities including the training of staff in the relevant bodies so as to be capable of preparing pipelines but it will also provide training and support for programme management activities such as monitoring, information and publicity, project appraisal and selection, implementation, contract management, financial management, control, monitoring, evaluation, reporting and audit. Given the needs to address staff turnover within the public administration allied to the demands of EU funds management which are typically higher than comparable civil service positions, co-financing of the salary costs of public officials within the management structure and project selection committees will be provided under this measure.
Eligible actions It is intended to finance, support, train and consolidate the systems, processes and skills for EU funds management by the Croatian public administration (as the future managing, certifying, auditing and implementing agencies for Structural Funds) in charge of this OP. Assistance under this measure refers to procurement contracts; it is intended that technical assistance will cover consultancy and delivery support (including advice, training and other costs) to the Croatian OP administration, in general but specifically to the Operating Structure for IPA III component – Environment i.e. bodies dealing with the implementation of the Priority axis 1 and Priority axis 2. That support will relate to the training activities for the: a. Independent identification, preparation and assessment of projects and Operational Programmes (including revising the existing Operational Programmes) in the relevant sectors for future funding
68 periods as well as respective project applications by teams of individuals in the national bodies (Operating Structure) all in order to build up a base of national expertise in this field; b. Capacity building for conducting of pre-feasibility and feasibility studies, environmental impact assessments, cost benefit analyses, financial and economic analyses, preliminary designs, affordability studies, sector consolidation studies; c. Implementation and controls, including procurement & contract management (including support to the Operating Structure, use of supervising engineers, etc); d. Monitoring (including the development of monitoring arrangements) the organisation and administration of Monitoring Committees and the development of the Management Information System; e. Evaluation, particularly external evaluators engaged for interim and ongoing evaluations; f. The preparation and implementation of information and publicity activities; g. Co-financing of staff salary costs.
Assistance can additionally include the provision for translation & interpretation services as well as logistical expenses and supply of equipment or other items relating to the of Monitoring Committee. Selection criteria Assistance will be granted to those activities that will have the highest learning effect especially in relation to gaining knowledge and experience in project preparation / assessment. Final beneficiaries The primarily beneficiaries of this measure are bodies in the Operating Structure and members of the Monitoring Committees and Selection Committees. Monitoring Indicators Table 3.8: Indicators for monitoring & evaluation for Measure 3.1 – OP management
Indicator Unit Baseline data Final Frequency of Data source (year) target reviewing
Outputs
Trainings provided for the pubic bodies for the implementation of PA 1 0 Project and PA 2 including trainings in Number 10 annually monitoring preparation and assessment of (2007) reports project applications
Waste project applications assessed 0 and submitted by the Operating Number 3 annually MEPPPC Structure (2006)
Water project applications assessed 0 and submitted by the Operating Number 6 annually MAFWM Structure (2006)
0 Project Monitoring Committee meetings Number 4 annually monitoring (2007) reports
69 3.3. HORIZONTAL ISSUES
3.3.1. Equal opportunities for men and women Gender Equality Law is in force in Croatia since July, 2003. It defines and regulates protection from discrimination on the grounds of gender, as well as equal opportunity mechanisms. The Gender Equality Ombudsperson monitors the implementation of the Gender Equality Law.
In September 2006, the Croatian Government adopted the National Policy for the Promotion of Gender Equality, 2006-2010. The objectives of the policy, which are of particular relevance to Components III & IV of IPA, include the reduction of female unemployment and elimination of discrimination, promotion of women’s entrepreneurship and improved enforcement of relevant labour laws. It also strengthens and promotes measures that support the reconciliation of professional and family obligations.
The Government has also adopted a strategic document on the main tasks of state administrative bodies in the process of accession to EU 2004-2007, one of which is noted as being to strengthen cooperation between national and local state mechanisms in relation to gender mainstreaming and continuous cooperation with non- governmental organisations active in the field of gender equality.
The involvement of society and communities in infrastructure construction, operation and maintenance will be sought, in an effort to contribute to the reduction of unemployment and poverty alleviation. Job opportunities can be enhanced in a sustainable way, through the employment of the Croatian labour force (male and female) especially in the post-construction phase for operations and infrastructure maintenance. 3.3.2. Environmental Protection and Sustainable Development Environmental protection being one of the three pillars of the “Sustainable development concept” makes it clear that not just the Sustainable Development concept will be incorporated into this OP but even more this OP will have a direct input/impact on sustainable development. The current status and planned steps envisaged to achieve continuous improvement and protection of the environment are given in more detail throughout this Operational Programme. However, in more general terms it can be stated that measures undertaken under the Environmental Operational Programme will have twofold effects in regard to the Sustainable development concept: 9 Investments in waste and water management (including drinking and waste water sub-sectors) will directly contribute to environmental protection in given areas; 9 They will contribute to economic development through investments, job creation and the creation of adequate environmental conditions for living and business. Furthermore, investments envisaged under the Priority axes will contribute to the implementation of the aquis in the field of environmental protection and to reaching the requested EU standards and “norms”, which is one of the key aspects of the EU integration process. Having in mind the abovementioned, attention will be paid to sustainability and environmental protection requirements, inter alia, in the selection phase (see Chapter on selection criteria) where highest economic/ social/ environmental impact is set as one of the main selection criteria, but also through the monitoring and evaluation processes. Since the Environmental Operational Programme is mainly focused on the major projects (investments of a value exceeding 10 m€), an important issue through which sustainability / environmental principles will be taken into account – is the necessity to carry out an Environmental Impact Assessment for planned investments.
All necessary environmental impact assessment procedures in line with EU requirements will be carried out by MEPPPC or the competent local authority. To implement the environmental impact assessment procedure, existing institutional structures will be used, and technical assistance will be sought to enhance professional capacity. Projects should not have negative effects on the natural assets of potential NATURA 2000 sites.
70 The Republic of Croatia has been performing environmental impact assessment for single developments since 1984, when the procedure was defined by the Act on Physical Planning and Spatial Development. Since 1994, when the Environmental Protection Act was adopted (OG 94/1994, 128/1999), the environmental impact assessment procedure is governed by this Act and its implementation regulation. The effective implementation regulation is the Ordinance on Environmental Impact Assessment (OG 59/00, 136/2004, 85/2006). The Act and Ordinance include most of the requirements from Council Directive 85/337/EEC of 27 June 1985 on assessment of the effects of certain public and private projects on the environment, as amended by Directives 97/11/EEC and 2003/35/EC, relating to: establishment of responsible bodies, EIA in a trans-boundary context, description of the EIA procedure, and assessment of direct and indirect effects.
The transposition of the remaining provisions of the Directive into Croatian legislation will be ensured by adoption of the new Environmental Protection Act in 2007, and the implementation regulation on environmental impact assessment. CARDS 2003 project "EIA Guidelines and Training” assisted in the transposition of Council Directive 85/337/EEC.
By adopting the new Environmental Protection Act and its sub-ordinate special regulations:
• the provisions of Directive 2001/42/EC of the European Parliament and Council of 27 June 2001 on the assessment of the effects of certain plans and programmes on the environment will be transposed;
• the provisions of Council Directive 96/61/EC of 24 September 1996 on Integrated Pollution Prevention and Control (IPPC) will be transposed.
Moreover, a transposition of Directive 2004/35/EC of the European Parliament and Council of 21 April 2004 on environmental liability with regard to the prevention and remedying of environmental damage is envisaged. Recognised principles of environmental protection, including also the polluter pays principle, are already in force in Croatia. 3.3.3. Participation of civil society and geographical, sectoral and thematic concentration The participation of representatives of civil society, along with other relevant institutions, in the preparation of the Operational Programme is described in Chapter 1.3. Partnership consultations. A detailed description of the concentration principle applied to this OP is given in Chapter 1.2.5.
3.4. COMPLEMENTARITIES AND SYNERGIES WITH OTHER FORMS OF ASSISTANCE
The EPOP will contribute to the achievement of Croatia’s global IPA objectives by improving conditions for growth and employment through the protection and improvement of the environment as well as of the administrative capacity. In this regard, EPOP’s synergies with other OPs within the SCF framework that contribute to increasing and improving the quality of human capital, the development of an innovation and knowledge society and the adaptability to economic and social changes are considered.
The EPOP contributes to strengthening economic integration by developing environmental infrastructure and enhancing access to services of general interest, by improving governance for a better quality of public policy, and by raising Croatia’s skills in environmental protection. 3.4.1. Complementarities and synergies with other SCF OP All four Operational Programmes under IPA Component III and IV (Regional Competitiveness, Transport, Environment and Human Resource Development) are mutually dependent, since the performance of all sectors together is a key prerequisite for achieving sustainable development. In this sense, they are integrated in their contribution to Croatia’s economic, environmental and social future.
The complementarity and synergy between the four OPs is most evident in the light of the Strategic Coherence Framework for 2007 – 2013, since its main task is to assure the consistency between priorities / activities under
71 IPA Components III and IV. In relation to the SCF, the Environmental Operational Programme is consistent with the other three OPs as follows:
Regional competitiveness Adequately developed municipal (including environmental) infrastructure and social infrastructure is a precondition for economic development, attraction of investment and improvement of the quality of life, i.e. for enhancing business related and basic municipal and social infrastructure. The development of basic infrastructure is a prerequisite for the growth of productive investments and entrepreneurship activities. Additionally, investment conducted in the course of the EPOP will create opportunities to increase SME development, as well as to improve the investment climate and raise interest among domestic and foreign investors.
Transport The development of transport links and modes is, on the one hand, a necessary prerequisite for economic development, but on the other, a sector that has a major influence on the environment (for example, the share of traffic in air pollution increased by an average of 20% in the period from 1990 to 1998). In this sense, the development of sustainable transport is closely linked to environmental protection and preservation; therefore emphasis is laid on the development of railway and inland waterway transport systems. This is also in line with the idea to promote multi-modal transport and generate traffic diversion effects, from polluting road to energy efficient rail/river transport modes.
Human resources Investment in environmental infrastructure should stimulate short-term employment within the construction sector, but it will also underpin economic activity within the beneficiary regions. In both cases, it is important that employment demand is matched by skill supply. Strengthening the institutional capacity and efficiency of public administrations and public services at national, regional and local levels in regard to environmental sector related policy and investments is another prerequisite for implementation of the EPOP priorities and development in general (having in mind that institutional capacity related activities will be conducted through IPA Component I – as set out in the IPA Regulation).
All four OPs also have certain common goals of a more general nature – to help the relevant institutions to achieve readiness for EU membership and develop institutional capacity for, and practical experience of, the management of Structural Funds-type interventions, i.e. to take part in the EU’s Cohesion policy. 3.4.2. Complementarities and synergies with other IPA components Besides the inter-linkages between the OPs covered by the SCF, clear and strong complementarities can be established in relation to the other three components:
IPA Component I – Transition Assistance and Institutional Building Strengthening the institutional capacity and efficiency of public administrations and public services at national, regional and local level in regard to environmental sector related policy and investments is another prerequisite for implementation of the EPOP priorities and development in general. Therefore a strong link between institutional building assistance under Component I – which main task is to provide capacity building support for alignment and implementation of environmental acquis to the relevant competent authorities at regional and national level and Component III, will be established and secured.
IPA Component II – Regional and Cross-Border Assistance Due to the nature of environmental projects significant regional effects can be achieved specially in the case of water sub-sector related projects both in terms of large projects (that can have a strong and trans-boundary effect) and small ones (that can cover the border geographical layout). In that sense coordination between Component III (Environment) and Component II (cross border cooperation) will be assured (see section 5).
IPA Component V – Rural Development Construction / upgrading of sewerage systems and WWTPs are envisaged as an indicative operation under ‘measure 1 - development of rural infrastructure’ of the third Priority Axis under IPA Component V. Moreover, municipalities with less than 20 000 inhabitants are envisaged as potential final beneficiaries of the mentioned
72 operations. That evidently makes the necessity for strong coordination and complementarity extremely important, in order to avoid overlaps and achieve maximum impact. As explained in sections 1.2.4 and 3 of this OP, besides large scale projects, the EPOP leaves the possibility for financing projects of a smaller scale, mainly related to the protection of ground water in the karst area (which is also mainly rural and with low population density). In that sense, the EPOP and the IPARD programme (IPA Rural Development Programme) have similar goals, but while in the case of IPARD, the focus will be on upgrading living / socio-economic conditions, the EPOP will be focused on the protection of ground water. Anyhow, strong coordination is a necessity and will be assured. Coordination arrangements A number of institutional arrangements are being proposed to promote complementarity and coherence between the various Components of IPA and the Environmental OP. The National IPA Coordinator ensures partnership between the Commission and the beneficiary country, and a close link between the general accession process and the use of assistance, and also bears overall responsibility for the coherence and co-ordination of the programmes. CODEF, headed by the National IPA Coordinator, takes overall responsibility for coordinating programming and monitoring activities under the IPA programme in Croatia. CODEF’s Department for EU Programmes in the Field of Capacity Building for EU Accession is responsible for co-ordinating IPA Components I, II and V. The Department for EU Programmes in the Field of Economic and Social Cohesion takes responsibility for the co-ordination of IPA Components III and IV. The Strategic Co-ordinator, placed under the responsibility of the National IPA Co-ordinator is responsible for co-ordinating assistance granted under the regional development component and the human resources development component. Regarding the methods of co-ordination, the IPA Monitoring Committee will assume the function of the overall co- ordination of assistance granted under the IPA programme. Coordination will be ensured on the one hand through discussions on implementation / progress / performance of each IPA component and, on the other hand, through the participation of representatives of the bodies heading each of the IPA components (Operating Structures) in addition to NIPAC, NAO and the EC. An Environmental Sectoral Monitoring Committee will be established and will report to the IPA Monitoring Committee. It will also serve as the main co-ordination tool since it will, among other people include representatives of the EC, NIPAC, NAO and the Strategic Co-ordinator for Components III and IV. Additionally under the direct responsibility of the NIPAC / Strategic Co-ordinator regular coordination meetings for IPA components III and IV will be held. With regard to project level coordination, the standard rule applies preventing financing a project from more than one EU source. By avoiding overlaps and enhancing synergy across measures, it was sought to enhance the impact of the limited IPA financing available to Croatia. Co-ordination of this Operational Programme with other OPs will, therefore, not only ensure that unnecessary overlapping is avoided, but will also promote possible complementarities and synergies.
The co-ordination of activities carried out by IFIs and other donors is ensured all along the programme cycle. In the programming phase, both CODEF and the Ministry of Finance coordinate the preparation of strategies and projects financed by the EU and IFIs in order to avoid duplication and achieve maximum synergies. In the implementation phase, representatives of the Ministry of Finance will be included in the IPA Monitoring Committees for projects which are financed by IFIs, while CODEF representatives will participate in progress monitoring meetings organised by the Ministry of Finance for projects financed through foreign loans and credits, as well as in audit missions undertaken by IFIs. In the case of any audit or evaluation mission organised by the European Commission for a specific project, representatives of the Ministry will be at the disposal of auditors/evaluators as necessary.
In addition, the State Secretary holds the function of the Deputy Chief Negotiator for EU Accession while the Deputy State Secretary is Sectoral Coordinator for Components III and IV, as well as is a member of the working group for negotiations on Chapter 22 Regional Policy and Coordination of Structural Instruments. This direct link with the accession negotiations process enables CODEF to ensure close coordination between EC funding and the accession process priorities – across all five of IPA components.
73 3.4.3. Complementarities and synergies with previous EU assistance and IFIs
3.4.3.1. Previous EU assistance
Assistance provided under IPA Component III (Environment) will build upon previous activities supported by the EU funds – namely CARDS, Phare and ISPA - in order to create a larger impact, as well as provide a consistent approach.
In February 2003, Croatia applied to join the EU and became an EU Candidate Country in June 2004. As a result, the EU pre-accession programmes, Phare, ISPA and Sapard, superseded CARDS as the main source of assistance funding for 2005 and 2006; for environmental projects funding comes from both Phare and ISPA.
From 2000 until now, a number of projects financed/co-financed by the EU were directed to the environmental sector. Analysing those projects, certain tendencies can be noticed.
9 During the 2000–2005 period, EU assistance was in general terms directed towards activities related to EU environmental law approximation, mainly through strengthening the legal and institutional framework, drafting environmental strategies and management plans and project preparation. 9 But from 2005 on with access to the pre-accession funds, that has started to change. While PHARE financed projects are, in a way, a continuation of what has been and still is being delivered through CARDS (i.e. activities related to the legislation approximation and Institutional capacity), the ISPA fund for the first time introduced co-financing of investments in “heavy” infrastructure (i.e. construction of WWTPs and regional landfills).
CARDS
In the environment sector, Croatia has received support from the EU CARDS programme48; from 2001 to 2004 this was the largest assistance programme running in the country. It supports 10 environment projects (total value € 10.4m) dealing with EU environmental law approximation (€ 3.3m), water related acquis .€ 2.8m) water information system (€ 0.8m), environmental assessment (€ 1.5m), waste management (€ 1.0m), and small-scale local waste management infrastructure (€ 1.8m).
Two CARDS projects have directly contributed to the development of major projects which are included in the EPOP’s indicative list of major projects: 9 The CARDS 2001 project: “Municipal Environmental Management Capacity and Infrastructure” was completed in December 2005. It was an institutional development project for local and regional authorities in two Dalmatian counties (Sibenik-Knin and Zadar counties) providing assistance in waste management planning and practices with an investment component. The project contributed to the development of the Bikarac Regional Waste Management Centre by financing the construction of a new reception area and recycling yard for the Bikarac landfill and also by providing assistance to the City of Šibenik for obtaining a location permit and the preparation of the main project for the construction of the first phase of a Waste Management Centre. The first phase of the Bikarac Waste Management Centre project is financed under ISPA. 9 The CARDS 2002 project: “Waste Management in Dalmatian Counties” started in December 2005 and was completed in May 2007. It provided support for strengthening waste management capacity in Dalmatia (with focus on Split-Dalmatia and Dubrovnik-Neretva Counties). The CARDS project was progressing through the collection of data, estimations of waste quantities, the selection of locations for future waste management centres in two counties, the completion of transfer station concepts, optimising of transport expenses etc. It resulted in the preparation of project documentation for an IPA application for the “Regional Waste Management Centre for the County of Split –Dalmatia” project.
48 M€ 262 allocated to 119 individual projects
74 The EPOP is focused on major projects; an important issue through which sustainability / environmental principles will be taken into account – is the necessity to carry out Environmental Impact Assessments for planned investments. For bringing environmental impact assessment procedures in line with EU requirements, Croatia received assistance through two CARDS projects: 9 CARDS 2003: “Environmental Impact Assessment – Guidelines and Training” started in July 2005 and was completed in January 2007. The main outputs of the project were: Recommendations for changes to the Environmental Protection Law, the EIA Rulebook and EIA procedures; a comprehensive procedures manual aimed principally at competent authorities; a set of EIA guidelines targeted primarily at EIA practitioners. The Project brochures have been published (Croatian and English version) as well as the Technical Guidelines for drafting the Environmental Impact Assessment Study. In addition Guidelines for conducting an EIA procedure have been developed.
9 CARDS 2003 “Environmental Assessment of Development Strategies” started in January 2006 and will last until the end of October 2007. It will help the authorities adopt the SEA Directive 2001/42/EC and strengthen their capacity for its implementation. Several activities have been carried out within the Project such as workshops for all the participants in the process (Ministries, Counties, NGO’s, developers of EIA studies/physical plans) the goal of which was to present the details of the Strategic EIA process. A SWOT analyses of the existing institutional implementation capacity has been made, the activities concerning the drafting of a Pilot Study on EIA (referring to the General Urban Plan of City of Šibenik) have started, four Strategies (Environmental protection, Energy, Tourism, Biodiversity) and two county physical plans (County of Istria and Split-Dalmatian County) will be the subject for the development of impact matrices and an analysis of the goals in the mentioned strategies during the development of physical plans; recommendations on the transposition of SEA Directive into the new Environmental Protection Act will be made.
Other projects dealing with EU environmental law approximation are: CARDS 2002 “Strategy for EU Environmental Law Approximation” which was completed in October 2006; CARDS 2003 ”Approximation of Water Management Legislation with EU Water Acquis” which started in May 2006 and will last 18 months; CARDS 2004: “Capacity Building and Development of Guidelines for Implementing the Water Framework Directive”. CARDS 2002 project “Strengthening Measures for the Croatian Environment Agency” included an analysis of the EU and Croatian environmental reporting legislation while its main outputs are (i) Development Strategy for Croatian Environment Agency and (ii) Environmental Information System functional design. The CARDS 2004 project “Support for Further Approximation with the Environmental Acquis” besides providing assistance for compliance with the IPPC Directive and for setting-up a greenhouse gas emission register, has a capacity building component for environmental investment projects in the waste management sector; the expected results within this component are: a training needs assessment for specified target groups in relation to the preparation of environmental investment projects; an Environmental Investment Project Preparation Manuel drafted; guidelines for investors drafted etc. The Project starts in September 2007 and it will last two years: The CARDS 2001: ‘Project Preparation Facility – National Waste Management Strategy – Focus on Municipal Waste’ project was completed in 2003. This project produced a draft national waste management strategy for municipal waste; this has now been developed into the National Waste Management Strategy, which was adopted in September 2005.
Phare
The Phare programme currently supports 4 environmental projects with a total amount of € 9.372m (national co- financing € 0,934m).
The further improvement of waste management in Croatia, with a focus on hazardous waste and sites highly polluted by waste will be assisted by the Phare 2006 project “Development of hazardous waste management system including the identification and management of “hot spot” sites”. The project will establish a hazardous waste management system according to National Waste Management Strategy, particularly in relation to the identification, categorisation and, further management of “hot spot” sites and will increase the ability of relevant governmental authorities to apply and enforce the acquis communataire relating to waste management. The
75 project includes four main components: (i) “Hot spot” site management; (ii) the improvement and management of the existing system of hazardous waste data collection and preparation for Market studies for hazardous waste streams; (iii) The establishment of environmentally sound management for hazardous waste; (iv) training, educational seminars, study tours. The remediation of sites highly polluted by waste is one of the measures under Priority axis 1 of this EPOP.
Projects under the EPOP should not have negative effects on the natural assets of potential NATURA 2000 sites. Croatia has started with preparation of the programme NATURA 2000 within LIFE III – Third countries project and Emerald network project, which will be continued within the PHARE 2005 project: "Implementation of NATURA 2000 in Croatia (CRO-NATURA)". The project is scheduled to be completed at the end of 2008. The overall objective of the project is the full compliance and implementation of the EU Habitats and Birds directives. The project's purpose is to establish and further implement NATURA 2000 in Croatia and build the capacity of the State Institute for Nature Protection for the provision of biodiversity data to the European Environment Agency (EEA). The project is expected to result in: 9 A complete proposal document for NATURA2000 to be submitted to the EC; 9 The implementation of Article 6 (1) of the Habitats Directive; 9 Management plans for potential NATURA 2000 sites; 9 SINP capacity to implement Article 6 (3) and (4) of the HD; 9 The assessment of plans and projects significantly affecting Nature 2000 sites; 9 A Nature Protection Information System (NPIS) -according to EU requirements etc.
Another Phare project refers to the enhancement of environmental inspection for enforcement of new environmental legislation (Phare 2005); and a Phare 2006 project for the establishment and equipping of 12 stations for air quality monitoring within the national air quality monitoring network.
Croatia also participates in the Phare 2005 multi-country programme on Environment and Enlargement in 2005 which provides pre-accession assistance to four candidate/acceding countries (Bulgaria, Croatia, Romania and Turkey). The project has three sub-components, which include “Development of the capacity of environmental authorities through transfer of best practice and training to support effective use of financial resources”. This sub- component is expected to contribute to the elaboration of a national Environmental Financing Strategy and the training of national and local authorities for the effective use of EU funds.
ISPA
The ISPA programme is so far essential for gaining experience with co-financing investments in “heavy directives” infrastructure. The National ISPA Strategy for Environment was developed in June 2005. It sets priority waste management, water supply, sewage and wastewater treatment investment projects and is used as a planning document for use for 30M€ of ISPA support in the period 2005 and 2006. The three approved projects are: 9 “Karlovac Water and Waste Water Programme” The main activities envisaged within this project are the following: construction of the WWTP of 100.000 p.e., investments in the water supply and sewerage systems and providing technical assistance (with equipment supply) to the Karlovac municipal company. The aim is to ensure the provision of safe drinking water in accordance with EU requirements and protection of the water environment in the Karlovac region and, in doing so, to achieve improved compliance with relevant EU directives. The project's total value is 36.0 M€, out of which 22.5 M€ (66%) is provided from ISPA funding and 13.5 M€ (34%) from national sources, including the repayment of an EBRD loan.
76 9 “Bikarac Regional Waste Management Centre ( Phase I)” The main activities envisaged within the project are the following: construction of a waste management centre for the Šibensko-kninska County - Bikarac, remediation of the Pirovac landfill, conduction of a pilot project on recycling and providing technical assistance to the municipal company. In Phase II of the project, the remaining landfills in the County will be remediated/closed and the recycling scheme will be expanded. The Financing Memorandum for the project was approved by the ISPA Management Committee in April 2006 and signed in September 2006.; total value of the project is 8.8 M€, out of which 6 M€ (68%) is being provided from ISPA funding and 2.8 M€ (32%) from national sources. 9 “IPA Project Pipeline Preparation (Environment)” The main objective of the project is to provide assistance to the Croatian national authorities in the preparation of an IPA project pipeline for environmental projects (in the wastewater/water and waste sectors). The activities are targeted at projects in the municipal waste, wastewater and water supply sectors, according to the indicative list of projects (that is part of the projects application/Financing Memoranda). The Financing Memorandum for the project was approved by the ISPA Management Committee in April 2006 and signed in September 2006. The total value of the project is 1.46 M€, out of which 0.96M€ (66%) is being provided from ISPA funding and 0.50 M€ (34%) from the State Budget.
Other programmes Croatia takes part in, and benefits from, LIFE III –Third Countries and bi-lateral projects, but also from the CARDS financed regional initiatives, such as the Regional Environmental Reconstruction Programme (REReP), which has helped identify investment priorities49 in the environment sector, and the DABLAS Task Force (Danube Black Sea Task Force), which was set up in 2001 to provide a platform for cooperation, to ensure the protection of water and water–related ecosystems in the Danube and Black Sea.
Under the LIFE III – Third Countries programme, 14 projects have been approved for different beneficiaries in Croatia until 2005. Project “Guidelines Development for Starting Implementation of Waste Management Plan in the Republic of Croatia” had the objective of establishing capacity for the implementation of the National Waste Management Strategy. The project provided a series of waste management databases and prepared guidelines on site selection and technical and organisational solutions in waste management. The project was completed in November 2006. An ongoing waste management project is “Development of sustainable construction and demolition waste management system for Croatia” (being implemented by the Faculty of Construction in Zagreb). Through LIFE III –Third countries project “Building up National Ecological Network as a part of the Pan-European Ecological Network and NATURA 2000 (CRO-NEN)” and the Emerald network project, Croatia has started with the preparation of the NATURA 2000 programme. Accordingly, potential NATURA 2000 sites have been identified based on scientific data and the programme for collecting additional needed data has been prepared.
The DABLAS Task Force (Danube Black Sea Task Force) was set up in 2001 with the aim of providing a platform for cooperation to ensure the protection of water and water–related ecosystems in the Danube and Black Sea areas. This was in response to a Communication adopted by the European Commission in 2001, which highlighted priority actions required to improve the environmental situation in the region. The overall goal is to develop financing mechanisms for the implementation of investment projects for pollution reduction and the rehabilitation of ecosystems in the wider Black Sea region. Under the leadership of the DABLAS Task Force, the first project was initiated to prioritise water sector investment projects addressing nutrient reduction. 113 out of a total of 158 potential municipal sector projects were evaluated in terms of their environmental impacts, impacts on the Black Sea, potential financing and technological efficiency and compliance. The ICPDR – DABLAS database has been developed to include municipal, industrial, agro-industrial, wetland restoration, and agricultural & land use projects. The database is an inter-active tool to be used for evaluating the remaining needs for investment and policy measures on a regional, national, and sector basis. The ICPDR DABLAS database is linked with the ICPDR emission inventories database.
49 REReP Priority Environmental Investment Programmeme (PEIP) contributed to investment capacity-building by identifying priorities and drafting proposals. As a result, a list of Croatia’s priority investment projects (waste, water, air) was compiled and presented at the PEIP Regional meeting in Brussels in September 2005.
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In the framework of the DABLAS Task Force, the Danube Investment Support Facility (DISF) Project has been developed with the financial support of the EU, with the aim of supporting the preparation of specific projects, and agreed within DABLAS Task force as a priority project, in terms of the preparation of the relevant feasibility study. In the framework of the DISF Project, four projects were prepared, or are under preparation in Croatia: the Karlovac, Osijek, Vukovar and Slavonski Brod water and waste water projects.
3.4.3.2. International Finance Institutions (IFIs) IFIs are already involved in certain activities related to environmental projects. IFIs represent possible sources of national co-financing for specific IPA projects, while at the same time, the programmes and plans of all IFIs have been taken into account while preparing this OP, and will continue to be reviewed when selecting individual projects for approval. Additionally, it is seen as useful to use the experience and expertise of the IFIs in the project preparation phase – for example, through existing initiatives such as DISF (Danube Investment Support Facility) and REREP (Regional Environmental Reconstruction Programme for South East Europe).
World Bank (WB) lending has focused on infrastructure, including the environment in projects such as: “Legislation Gap Analysis” (first project related to legislation harmonisation); Karst Ecosystem Conservation – KEC; The National Environmental Data Gathering Capacity (NEDGC); Coastal Cities Pollution Control Project for Croatia (value of programme first stage is approx. € 80 million to, inter alia, improve the quality of recipient waters and provide better water services in the Adriatic basins – see below) etc. The following projects are co-financed by the UNDP and the World Bank: UNDP/GEF - "Enabling Croatia to prepare its first National Communication in response to its commitments to the UNFCCC"; UNEP/GEF Project Development of the National Biosafety Framework.
As determined in the assessment strategy for Croatia in the forthcoming period, the WB will, inter alia focus on assisting the Government of Croatia in facilitating sustainable natural resource management through strengthening environmental management capacity, upgrading wastewater and water supply infrastructure and improving energy efficiency.
Within the Global Environment Facility (GEF) funded project “Determination of priority actions for the further elaboration and implementation of the Strategic Action Programme for the Mediterranean Sea”, Croatia has prepared a National Action Plan (NAP) for the Protection of the Mediterranean Sea Against Pollution from Land- Based Sources. NAP is primarily focused on determining proposals for environmental protection priority actions in the coastal areas of Croatia. The major environmental issue in the coastal area is wastewater pollution. NAP priorities herein are wastewater treatment and collection in the largest coastal cities of Split and Rijeka but also in further major coastal cities Šibenik, Dubrovnik, Pula and Zadar. Additionally, two sets of priorities were singled out for addressing pollution from industrial waste water, first including major industrial polluters with self-standing outfalls (in Rovinj, Zadar and Split), and other set of priorities which includes all other industries in the coastal area. Solid waste management and disposal are further NAP priorities: it foresees the construction of two regional waste management centres for Split-Dalmatia and Primorje-Gorski Kotar Counties. Additionally, the NAP envisages the remediation of the largest landfills and dumpsites in the region which do not meet the provisions of the applicable regulations and pose an environmental risk. (Karepovac-Split, Sovjak and Viševac – Rijeka). Another NAP priority is hazardous waste management and disposal.
The national environmental plans, especially the programme for the protection of coastal water against pollution, and the mentioned Coastal Cities Pollution Control Project envisage the construction, upgrading, reconstruction and improvement of sewerage systems and waste water treatment systems with the aim of protecting and improving seawater quality, creating the conditions for a safe economic development in accordance with the objectives of environmental protection, protecting and improving the achieved level of environmental protection and meeting EU standards regarding the quality of the environment in local communities. Programme implementation is planned in three phases encompassing about 80 settlements in the coastal area. The first stage of the Programme started implementation in 2005 and it is planned to be finished in 2008. Construction works are being carried out in the following cities Opatija, Zadar, Rijeka and Biograd, Novigrad, Makarska, Omiš, Opuzen, Pula and the municipalities of Lovran, Matulji, Pakoštane and Sveti Filip i Jakov, Dugi Rat and
78 Rogoznica. 27 sub-projects (towns and municipalities), are envisaged for implementation in the second stage of Programme. Currently the technical project documentation is under preparation. This three stage programme is planned to be carried out over 15 years.
NAP's solid waste management priorities envisage the solution of the waste management problems in the greater area of the City of Split and the greater area of the City of Rijeka. This is in line with National Waste Management Implementation Plan. The NAP’s solid waste management priorities are reflected in the EPOP's indicative list of major projects where regional waste management centres in Split-Dalmatia and Primorje-Gorski Kotar Counties are two top priority projects. Also, the remediation of the Sovjak dumpsite is a project represented on this list. The remediation of landfills in Croatia is an ongoing activity supported by Environmental Protection and Energy Efficiency Fund co-financing, which also includes landfills in the coastal area.
In the infrastructure and environment sector, the European Bank for Reconstruction and Development (EBRD) envisages working with a number of large and medium-sized municipalities to develop their infrastructure projects for prospective EU co-financing. In addition, the Bank will continue to roll out instruments to reach small municipalities through local banks, and promoting investment in environmental infrastructure with donor support (EU and Netherlands). Some of the environmental projects in which the EBRD participated are: Zagreb’s solid waste programme and WWTP, as well as the improvement of Rijeka's sewerage system and the ISPA project “Karlovac water and waste water programme”. The EBRD has also started negotiations with the County of Istria to support the preparation and implementation of their project which is in the IPA project pipeline.
Although the transport sector will remain a priority for the European Investment Bank it is envisaged to direct more loans to both the environment sector (i.e. waste water treatment, Zagreb incinerator) and the health sector (Zagreb hospitals).
The KfW Entwicklungsbank envisages drinking water supply and sewage and waste disposal improvement as priority activities under the Social Infrastructure Operation area.
One of the five priority areas for the United Nations Development Programme in Croatia is “Environmental Governance” – with the aim of ensuring that natural resources are used in a sustainable manner and in compliance with the international obligations and agreements that the Republic of Croatia has assumed. So far activities and projects under the respective priority have been mainly related to strengthening institutional / administrative capacity under the climate change and biodiversity sectors.
79 3.5. INDICATIVE LIST OF MAJOR PROJECTS WASTE: The indicative list below represents an updated indicative ISPA project priority list with new projects for construction of county waste management centres included. Selection of all projects on the list is based upon criteria set out in Section 3.1. The first three projects (ranked according to their priority) are being proposed for IPA funding in the period 2007- 2009.
PRIORITY AXIS 1 – Developing waste management infrastructure for establishing an integrated waste management system in Croatia
Nr Project name Type Project Estimated Measure Comments Status preparation Total M€ support 1 Regional Waste Management Construction 41.78 Measure The main objective of the Project is to establish integrated Is being Centre Marišćina 1.1 sustainable waste management system on a county level prepared for (The County of Primorje and (305,505 inhabitants) Main activities: funding in 2007 Gorski Kotar) * • Construction of new WMC – plateaus in operating zone, MBT, phase 1 of landfill area, wastewater and leachate treatment system, buffer zone, internal infrastructure (stage I) • Technical assistance in public awareness raising and supervision of works
For IPA funding the construction of RWMC (without MBT facility) and technical assistance is being proposed
80 PRIORITY AXIS 1 – Developing waste management infrastructure for establishing an integrated waste management system in Croatia
Nr Project name Type Project Estimated Measure Comments Status preparation Total M€ support
2 Regional Waste Management Construction CARDS 55.7 Measure The main objective is to establish integrated sustainable waste Is being Centre for the County of Split – 2002 1.1 management system on a county level (464,000 inhabitants). prepared for Dalmatia* Main activities: funding in 2007 • Construction of new WMC of the County of Split-Dalmatia including MBO facility (phase I) • Construction of 4 transfer stations (TS) on islands and 4 TS in the mainland • Optimizing of waste transport from TS to the RWMC • Pilot study for separate collection of waste for town of Split
For IPA funding construction of WMC, transfer stations and pilot study is being proposed 3 Regional Waste Management Construction EBRD 45 Measure The main objective of the Project is to establish integrated Is being Centre for the County of Istria* 1.1 sustainable waste management system on a county level prepared for (206,344 inhabitants) funding in 2007 Main activities: • Construction of new RWMC-Kaštijun including MBO facility • Construction of four Transfer Stations • Vehicles for long range transport – between the transfer stations and the RWMC • Technical Assistance in public awareness arising and supervision of the works
For IPA funding construction of new RWMC (without MBO facilities), technical assistances and vehicles for long range transport and transfer stations is being proposed
81 PRIORITY AXIS 1 – Developing waste management infrastructure for establishing an integrated waste management system in Croatia
Nr Project name Type Project Estimated Measure Comments Status preparation Total M€ support 4 Remediation and closing down Remediation IPA 25 Measure The main objective is remediation and closing down of the In preparation of the Sovjak pit, County of 1.2 abandoned hazardous waste landfill Sovjak, in karst region, in Primorje-Gorski Kotar* which had been deposited 250.000 m3 of hazardous waste (from refinery, shipyard and oil containers, etc). Main activities: • Excavation and disposal/treatment of hazardous waste • Stabilizing of remaining landfill against water infiltration • Capping of the landfill area, biological recultivation of the landfill area and immediate surroundings • Leachate control and treatment • Reduction of adverse impact on soil, air and water in the area in conjunction with the remediation of the Visevac municipal waste landfill site • Monitoring of environmental impacts of the closed landfill 5 Waste Management Centre for Construction CARDS 24.8 Measure The main objective is to establish integrated sustainable waste In preparation the County of Dubrovnik- 2002 1.1 management system on a regional (county) level (122,870 Neretva* IPA inhabitants). Main activities: Phase I • Construction of new RWMC including MBO facility • Construction of 4 transfer stations (TS) on islands and 3 TS in the mainland • Providing special vehicles for the optimizing of waste transporting from TS to the RWMC. Phase II • Constructing of facilities for pre-treatment of separately collected waste and sorting facility in scope of County Waste Management Zone
82 PRIORITY AXIS 1 – Developing waste management infrastructure for establishing an integrated waste management system in Croatia
Nr Project name Type Project Estimated Measure Comments Status preparation Total M€ support 6 Regional Waste Management Construction CARDS 35.9 Measure The main objective is to establish integrated sustainable waste In preparation Centre for County of Zadar* 2001 1.1 management system on a county level (162,045 inhabitants). (estimated . date IPA Main activities: for • Construction of new WMC implementation – • Construction of transfer stations 2008) • Providing of the special vehicles for the optimizing of waste transporting from TS to the WMC 7 Waste Management Centre for Construction IPA Measure The construction of waste management centre and other In preparation County of Virovitica-Podravina 1.1 facilities needed for development of integrated waste (estimated . date management for implementation – 2008) 8 Waste Management Centre for Construction IPA Measure The construction of waste management centre and other In preparation North-West Croatia* 1.1 facilities needed for development of integrated waste (estimated . date management for implementation – 2008) 9 Waste Management Centre for Construction IPA Measure The construction of waste management centre and other In preparation East Slavonia* 1.1 facilities needed for development of integrated waste (estimated . date management for implementation – 2008) 10 Waste Management Centre for Construction IPA Measure The construction of waste management centre and other In preparation Karlovac County 1.1 facilities needed for development of integrated waste (estimated . date management for implementation – 2009)
83 PRIORITY AXIS 1 – Developing waste management infrastructure for establishing an integrated waste management system in Croatia
Nr Project name Type Project Estimated Measure Comments Status preparation Total M€ support 11 Waste Management Centre for Construction IPA Measure The construction of waste management centre and other In preparation County of Brodsko-Posavska 1.1 facilities needed for development of integrated waste (estimated . date management for implementation – 2009) 12 Waste Management Centre for Construction IPA Measure The construction of waste management centre and other In preparation Sisak-Moslavina County 1.1 facilities needed for development of integrated waste (estimated . date management for implementation – 2008)
* Projects were part of the ISPA Strategy Indicative list: W3, W1, W4, W6, W12, W11, W5 and W10
84 WATER: List below represent updated ISPA project priority list where also three new projects are determinate. Selection of all these below indicated projects is based upon criteria set out in Section 3.1.
PRIORITY AXIS 2 – Protecting Croatia’s water resources through improved water supply and integrated waste water management systems
Project name Type Project Estimated Measure Comments Status Nr preparation Total M€ support
1 Slavonski Brod Waste water DABLAS/DISF 27 Measure Significant preparatory work already undertaken. Interest Will be ready for treatment 2.1. of IFI – EIB. TA for completing IPA application assured. funding in 2007 Investment includes construction of WWTP, sewage Water supply Measure network and reconstruction of water supply system 2.2.
2 Knin - Drniš Waste water EC support 11.7 + 4,7 = Measure Support from CARDS project the significant preparatory Will be ready for treatment CARDS- ROP 16.4 2.1. work will be done (feasibility studies, design, & tender funding in 2007 Water supply Measure documents). 2.2.
3 Osijek Waste water DABLAS/DISF 20 Measure Significant preparatory work already undertaken. Interest Will be ready for treatment 2.2. of IFI – EIB. TA for completing IPA application assured. funding in 2008 Project pre-appraisal from EC done in June 2005
4 Vukovar Waste water DABLAS/DISF 19 Measure Significant preparatory work already undertaken. Interest Will be ready for treatment 2.2. of IFI – EIB. funding in 2008
5 Bjelovar-Bilogora* Water supply ISPA TA 55 Measure County with lowest level of water connections (31%) in Selection of 2.1. Croatia. Amount of 55 mil EUR in accordance with TOR Consultants for and estimation for ISPA TA preparation of technical project documentation is under procedure. Estimated date of
85 PRIORITY AXIS 2 – Protecting Croatia’s water resources through improved water supply and integrated waste water management systems
Project name Type Project Estimated Measure Comments Status Nr preparation Total M€ support finalising IPA application with supporting documents is 2008.
6 Koprivnica-Krizevci* Water supply ISPA TA 52 Measure County with low level of water connections. Amount of Selection of 2.1. 52 mil EUR in accordance with TOR and estimation for Consultants for ISPA TA preparation of technical project documentation is under procedure. Estimated date of finalising IPA application with supporting documents is 2008
7 Nova Gradiska Waste water ISPA TA 13 Measure 25.000 p.e. Amount of 13 mil EUR includes extension Selection of treatment 2.2. of network Amount of 8,55 mil EUR in accordance with Consultants for TOR and estimation for ISPA TA: which includes WWTP preparation of and connecting sewer main technical project documentation is under procedure. Estimated date of finalising IPA application with supporting documents is 2008.
86 PRIORITY AXIS 2 – Protecting Croatia’s water resources through improved water supply and integrated waste water management systems
Project name Type Project Estimated Measure Comments Status Nr preparation Total M€ support
8 Djakovo Waste water ISPA TA 16,5 Measure 21,000 inhabitants, planned capacity 30,000 p.e Selection of treatment 2.2. Consultants for preparation of technical project documentation is under procedure. Estimated date of finalising IPA application with supporting documents is 2008.
9 Sisak Waste water ISPA TA / 31 Measure TA for completing IPA application assured (EBRD) In preparation treatment EBRD 2.2. Estimated date of finalising IPA application with supporting documents is 2008.
10 Vrbovec Waste water IPA 6 Measure In preparation treatment 2.2. Estimated date of finalising IPA application with supporting documents is 2009
11 Krapina Waste water IPA 5.8 Measure In preparation
87 PRIORITY AXIS 2 – Protecting Croatia’s water resources through improved water supply and integrated waste water management systems
Project name Type Project Estimated Measure Comments Status Nr preparation Total M€ support treatment 2.2. Estimated date of finalising IPA application with supporting documents is 2009.
12 Velika Gorica Waste water IPA 5.5 Measure Estimated date of treatment 2.2. finalising IPA application with supporting documents is 2009.
13 Samobor Waste water IPA 10 Measure Estimated date of treatment 2.2. finalising IPA application with supporting documents is 2009.
14 Dugo Selo IPA 14.8 Measure Estimated date of 2.2. finalising IPA application with supporting documents is 2009.
* Projects were part of the ISPA Strategy Indicative list: WS 4 and WS3
88
4. INDICATIVE FINANCIAL TABLES FOR THE ENVIRONMENT OPERATIONAL PROGRAMME
For Public expenditure information
Community National Public IPA cofinancing Other (IFI, Total Public expenditure YEARS 2007 - 2009 Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Developing waste management infrastructure for establishing an integrated waste management system in Croatia 35.133.000 26.349.750 8.783.250 75% 0 Measure 1.1: Establishment of new waste management centres at county/ regional levels 34.893.000 26.169.750 8.723.250 75% 0 Measure 1.2. Remediation of sites highly polluted by waste (hot spots) 240.000 180.000 60.000 75% 0
Priority Axis 2: Protecting Croatia’s water resources through improved water supply and integrated wastewater management systems 35.267.000 26.450.250 8.816.750 75% 0 Measure 2.1. Establishment of modern water supply systems and networks 3.733.000 2.799.750 933.250 75% 0 Measure 2.2 Construction of WWTP for domestic and industrial wastewaters and upgrading of sewerage network 31.534.000 23.650.500 7.883.500 75% 0
Technical Assistance 933.000 699.750 233.250 75% 0 Measure 3.1 OP management and capacity building 933.000 699.750 233.250 75% 0
Total Years 2007 - 2009 71.333.000 53.499.750 17.833.250 75% 0 Regarding waste sub-sector, the potential national sources of financing are Environment Protection and Energy Efficiency Fund, Croatian financial institutions, counties and local budgets. With regard to IFIs, EBRD has expressed its interest to give technical assistance for a development of project documentation for the project: Regional Waste Management Centre for the County of Istria which will be followed by the loan for sub financing the implementation of the project. Regarding water sub-sector the potential national sources of financing are State Budget, Municipality Budget, County Budget, Croatian Waters and IFI. With regard to IFIs, EIB has expressed its interest take part in financing of projects in Town Osijek and Slavonski Brod.
89
For Public expenditure information
Total Public Community National Public IPA cofinancing Other (IFI, YEAR 2007 expenditure Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Developing waste management infrastructure for establishing an integrated waste management system in Croatia 11.133.000 8.349.750 2.783.250 75% 0 Measure 1.1: Establishment of new waste management centres at county/ regional levels 11.059.667 8.294.750 2.764.917 75% Measure 1.2. Remediation of sites highly polluted by waste (hot spots) 73.333 55.000 18.333 75%
Priority Axis 2: Protecting Croatia’s water resources through improved water supply and integrated wastewater management systems 11.200.000 8.400.000 2.800.000 75% 0 Measure 2.1. Establishment of modern water supply systems and networks 2.196.750 1.647.500 549.250 75% Measure 2.2 Construction of WWTP for domestic and industrial wastewaters and upgrading of sewerage network 9.003.250 6.752.500 2.250.750 75%
Technical Assistance 333.000 249.750 83.250 75% 0 Measure 3.1 OP management 333.000 249.750 83.250 75%
Total Year 2007 22.666.000 16.999.500 5.666.500 75% 0
90
For Public expenditure information
Total Public Community National Public IPA cofinancing Other (IFI, YEAR 2008 expenditure Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Developing waste management infrastructure for establishing an integrated waste management system in Croatia 11.833.000 8.874.750 2.958.250 75% 0 Measure 1.1: Establishment of new waste management centres at county/ regional levels 11.759.667 8.819.750 2.939.917 75% Measure 1.2. Remediation of sites highly polluted by waste (hot spots) 73.333 55.000 18.333 75%
Priority Axis 2: Protecting Croatia’s water resources through improved water supply and integrated wastewater management systems 11.867.000 8.900.250 2.966.750 75% 0 Measure 2.1. Establishment of modern water supply systems and networks 1.479.750 1.109.813 359.937 75% Measure 2.2 Construction of WWTP for domestic and industrial wastewaters and upgrading of the sewerage network 10.387.250 7.790.437 2.596.813 75%
Technical Assistance 300.000 225.000 75.000 75% 0 Measure 3.1 OP management and capacity building 300.000 225.000 75.000 75%
Total Year 2008 24.000.000 18.000.000 6.000.000 75% 0
91 For Public expenditure information
Total Public Community National Public IPA cofinancing Other (IFI, YEAR 2009 expenditure Contrib. (IPA) Contrib. rate etc)
(1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1: Developing waste management infrastructure for establishing an integrated waste management system in Croatia 12.167.000 9.125.250 3.041.750 75% 0 Measure 1.1: Establishment of new waste management centres at county/ regional levels 12.073.666 9.055.250 3.018.416 75% Measure 1.2. Remediation of sites highly polluted by waste (hot spots) 93.334 70.000 23.334 75%
Priority Axis 2: Protecting Croatia’s water resources through improved water supply and integrated wastewater management systems 12.200.000 9.150.000 3.050.000 75% 0 Measure 2.1. Establishment of modern water supply systems and networks 121.400 91.050 30.350 75% Measure 2.2 Construction of WWTP for domestic and industrial wastewaters and upgrading of sewerage network 12.078.600 9.058.950 3.019.650 75%
Technical Assistance 300.000 225.000 75.000 75% 0 Measure 3.1 OP management and capacity building 300.000 225.000 75.000 75%
Total Year 2009 24.667.000 18.500.250 6.166.750 75% 0
92 5. IMPLEMENTATION PROVISIONS
5.1. MANAGEMENT AND CONTROL STRUCTURES This chapter of the Operational Programme describes the systems and arrangements in place as they are known at the time of the drafting the Operational Programme. However, a number of critical decisions regarding structures and responsibilities, as well as management and information systems, will be taken in the context of the accreditation for conferral of decentralised management, which follows a different timing from the adoption of the Operational Programme. To this end, the Framework Agreement, as well as the Financing Agreement to be signed after conferral of decentralised management, will set out the detailed provisions regarding management and control systems. The provisions in this chapter must therefore be understood as subject to latter adaptations by the applicable provisions of these agreements, where required.
CODEF will oversee the implementation of all five components of the IPA programme. The State Secretary of CODEF is appointed as the National IPA Coordinator. The role of the Strategic Co-ordinator for IPA Components III & IV will be assumed by the Deputy State Secretary of CODEF. The Strategic Coordinator will ensure that there is complementarity and coherence between the programmes implemented in the regional development and human resources development spheres, especially taking into account the limited amount of financial resources available under IPA and the need for the concentration of activities. 5.1.1. Bodies and authorities Based on the IPA Implementing Regulation, the Croatian Government has adopted its own legal act/s to designate specific bodies for IPA management and implementation50.
Under the provisions of this Regulation, the following individuals/bodies have been or will be designated / established: • National IPA Coordinator • Strategic Coordinator for the regional development and the human resources development components • Competent Accrediting Officer • National Authorising Officer • National Fund • Audit Authority • Operating Structure With the exception of the Operating Structure and the role of the Strategic Coordinator, these bodies essentially perform tasks which are generally applicable to all IPA components in accordance with their functions specified in the relevant articles of the IPA Implementing Regulation.
50 Regulation on the Scope and Contents of Responsibilities and the Authority of Bodies Responsible for Managing the Instrument For Pre-Accession Assistance (OG 18/2007); Amendments to the Regulation on the Scope and Contents of Responsibilities and the Authority of Bodies Responsible for Managing the Instrument For Pre-Accession Assistance (OG 82/2007) Decision on the Appointment of Individuals Responsible for Managing the Instrument for Pre-Accession Assistance (IPA) (OG 18/2007); Amendment to the Decision on the Appointment of Individuals Responsible for Managing the Instrument for Pre-Accession Assistance (IPA) (OG 82/2007)
93 Accordingly, in line with the provisions of Article 7.3 of the afore-mentioned Regulation and as specified in the 'model' Framework Agreement adopted by the Commission on 6 July 2007 [ref C(2007) 3208 final – E/1368/2007], such functions will be incorporated under the Framework Agreement to be concluded between the Commission and Croatia.
Operating Structure This Operational Programme will be managed by the Head of the Operating Structure who will be responsible for the following functions in compliance with Article 28.2 of the IPA Implementing Regulation: • Drafting the annual or multi-annual programmes; • Programme monitoring and guiding the work of the Sectoral Monitoring Committee as defined in Article 59, notably by providing the documents necessary for monitoring the quality of implementation of the programmes; • Drawing up the sectoral annual and final implementation reports defined in Article 61(1) and, after their examination by the Sectoral Monitoring Committee, submitting them to the Commission, to the National IPA Co-ordinator and to the National Authorising Officer; • Ensuring that operations are selected for funding and approved in accordance with the criteria and mechanisms applicable to the programmes, and that they comply with the relevant Community and national rules; • Setting up procedures to ensure the retention of all documents required to ensure an adequate audit trail, in accordance with Article 20; • Arranging for tendering procedures, grant award procedures, the ensuing contracting, and making payments to, and recoveries from, the final beneficiary; • Ensuring that all bodies involved in the implementation of operations maintain a separate accounting system or a separate accounting codification; • Ensuring that the National Fund and the National Authorising Officer receive all necessary information on the procedures and verifications carried out in relation to expenditure; • Setting up, maintaining and updating the reporting and information system; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; • Ensuring internal audit of its different constituting bodies; • Ensuring irregularity reporting; • Ensuring compliance with the information and publicity requirements. The Operating Structure (OS) will be composed of the following specific bodies in accordance with Article 31 of the IPA Implementing Regulation: • The Ministry of Environment Protection, Physical Planning and Construction (MEPPPC), • The Ministry of Agriculture, Forestry and Water Management (MAFWM), • Croatian Waters (CW), • The Environment Protection and Energy Efficiency Fund (EPEEF), • The Central Finance and Contracting Agency for EU Programmes and Projects (CFCA).
94 The position and level of responsibility, as well as the Heads of specific bodies within the Operating Structure, are shown in the following table:
Level of Titles of the bodies within Specific bodies within the Operating Structure Responsibility the Operating Structure Heads of specific bodies within the Operating Structure I. Operational Body Responsible for OP The Ministry of Environment Protection, Physical Planning and Construction Programme level State Secretary for Environment Protection Ulica Republike Austrije 14, 10000 Zagreb II. Priority/Measure Body Responsible for Priority Axis 1 Priority Axis 2 Priority Axis 3 level Priority/Measure The Ministry of Environment The Ministry of Agriculture, The Ministry of Environment Protection, Forestry Protection, Physical Planning and Construction and Water Management Physical Planning and Directorate for Strategic and Directorate for Water Policy and Construction Integration International Projects Directorate for Strategic and Processes in Environmental State Secretary for Water Integration Protection Management Processes in Environmental Assistant Minister Ulica grada Vukovara 220, 10000 Protection Ulica Republike Austrije 14, 10000 Zagreb Assistant Minister Zagreb Ulica Republike Austrije 14, 10000 Zagreb
III. Project level Implementing Body The Environment Protection Croatian Waters Central Finance and Contracting (Contracting Authority) and Energy Efficiency Fund Deputy Director Agency for EU Programmes and Director Ulica grada Vukovara 220, 10000 Projects (CFCA) Ksaver 208, 10000 Zagreb Zagreb Head of CFCA Katančićeva 5, 10000 Zagreb
95 The State Secretary of the Ministry of Environment Protection, Physical Planning and Construction will act as the Head of Operating Structure in the meaning of Article 167 (3) of the IPA Implementing Regulation. Any personnel changes in the Heads of the specific bodies referred to above will be notified to the Commission, as appropriate, including any changes which affect the accreditation of the Operating Structure and the Commission's subsequent conferral of management powers.
Distribution of functions The Ministry of Environment Protection, Physical Planning and Construction (as the Body Responsible for the OP) bears overall responsibility for the management of the Operational Programme and executes the following functions in relation to the Operational Programme as a whole: • Coordination of Operational Programme preparation and adjustment; • Coordination of programme monitoring in accordance with provisions of Article 59 of the IPA Implementing Regulation; • Coordination of the preparation of the annual and final sectoral reports (Article 169 of the IPA Implementing Regulation); • Setting up procedures for the retention of all documents to ensure a sufficiently detailed audit trail (Article 20 of the IPA Implementing Regulation); • Organisation of interim evaluations during the period of programme implementation; • Setting up, maintaining and updating a reporting and information system; • Ensuring that all bodies involved in the implementation of operations maintain a separate accounting system or a separate accounting codification; • Ensuring that the National Fund and the National Authorising Officer receive all necessary information on the procedures and verifications carried out in relation to expenditure; • Ensuring internal audit of its different constituent bodies; • Ensuring irregularity reporting; • Ensuring risk management reporting; • Ensuring compliance with the information and publicity requirements;
The Ministry of Environment Protection, Physical Planning and Construction (as the Body Responsible for a Priority/Measure) will specifically execute the following tasks for all measures within Priority Axis 1 – Developing Waste Management Infrastructure for Establishing and Integrated Waste Management System in Croatia and for Priority Axis 3 – Technical Assistance: • Preparation of the sections of the Operational Programme within its sectoral area of responsibility; • Preparation of monitoring data/reports within its sectoral area of responsibility; • Preparation of relevant sections of sectoral annual and final reports, within their area of responsibility; • Ensuring that all the relevant information is available to ensure at all times a sufficiently detailed audit trail; • Identification of the intended final beneficiaries, the expected selection modalities and possible related specific selection criteria (Article 155 of IPA Implementing Regulation); • Ensuring that operations within their sectoral area of responsibility are selected for funding and approved in accordance with the criteria applicable of the OP; • In its capacity as a beneficiary, assistance in the technical preparation and management of the projects on the basis of formal agreements with the implementing body;
96 • Quality appraisal of major projects prepared by the Final Beneficiaries (where relevant) and their submission to the National IPA Coordinator; • Submission to the National Fund of requests for payment and all supporting documents; • Preparing and submitting all necessary information on the procedures and verifications carried out in relation to expenditure; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; • Internal audit; • Irregularity reporting; • Risk management reporting; • Compliance with the information and publicity requirements.
The Ministry of Agriculture, Forestry and Water Management (as the Body Responsible for a Priority/Measure) will execute the following functions for all measures within the Priority Axis 2 – Protecting Croatia’s Water Resources through Improved Water supply and Integrated Wastewater Management System: • Preparation of the sections of the Operational Programme within its sectoral area of responsibility; • Preparation of monitoring data/reports within its sectoral area of responsibility; • Preparation of relevant sections of sectoral annual and final reports, within their area of responsibility; • Ensuring that all the relevant information is available to ensure at all times a sufficiently detailed audit trail; • Identification of the intended final beneficiaries, the expected selection modalities and possible related specific selection criteria (Article 155 of IPA Implementing Regulation); • Ensuring that operations within their sectoral area of responsibility are selected for funding and approved in accordance with criteria applicable to the OP; • In its capacity as a beneficiary, assistance in the technical preparation and management of the projects on the basis of formal agreements with the implementing body; • Quality appraisal of major projects prepared by the Final Beneficiaries (where relevant) and their submission to the National IPA Coordinator; • Submission to the National Fund of requests for payment and all supporting documents; • Preparation and submitting all necessary information on the procedures and verifications carried out in relation to expenditure; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; • Internal audit; • Irregularity reporting; • Risk management reporting; • Compliance with the information and publicity requirements.
97 The Environmental Protection and Energy Efficiency Fund (as an Implementing Body) will execute the following functions for all measures within the Priority Axis 1 – Developing Waste Management Infrastructure for Establishing and Integrated Waste Management System in Croatia: • Verification of tender documents received from beneficiary institutions and preparation of complete tender dossier; • Arranging for tendering procedures and contract award procedures; • Acting as the Contracting Authority; • Contract implementation; • Preparation and submission of payment claims to the body responsible for measure/priority; • Making payments to, and recoveries from, the final beneficiary; • Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; • Support in the preparation of documents for the sectoral monitoring committee on the progress made towards achieving targets of the measures; • Support in the preparation of annual and final sectoral implementation reports; • Maintenance of a separate accounting system or a separate accounting codification; • Internal audit; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; • Irregularity reporting.
The Croatian Waters (as an Implementing Body) will execute the following functions for all measures within the Priority Axis 2 – Protecting Croatia’s Water Resources through Improved Water supply and Integrated Wastewater Management System: • Verification of tender documents received from beneficiary institutions and preparation of complete tender dossier; • Arranging for tendering procedures and contract award procedures; • Acting as the Contracting Authority; • Contract implementation; • Preparation and submission of payment claims to the body responsible for measure/priority; • Making payments to, and recoveries from, the final beneficiary; • Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate;
98 • Support in preparation of documents for the sectoral monitoring committee on progress made towards achieving targets of the measures; • Support in the preparation of annual and final sectoral implementation reports; • Maintenance of a separate accounting system or a separate accounting codification; • Internal audit; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; • Irregularity reporting. The Central Finance and Contracting Agency for EU Programmes and Projects (CFCA) (as an Implementing Body) will execute the following functions for measure within the Priority Axis 3 - Technical Assistance: • Verification of tender documents received from beneficiary institutions and preparation of complete tender dossier; • Arranging for tendering procedures and contract award procedures; • Acting as the Contracting Authority; • Contract implementation; • Preparation and submission of payment claims to the body responsible for measure/priority; • Making payments to, and recoveries from, the final beneficiary; • Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; • Support in preparation of documents for the sectoral monitoring committee on progress made towards achieving targets of the measures; • Support in the preparation of annual and final sectoral implementation reports; • Maintenance of a separate accounting system or a separate accounting codification; • Internal audit; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail; • Irregularity reporting. All the bodies within the Operating Structure are ultimately accountable to the Ministry of Environment Protection, Physical Planning and Construction which bears overall responsibility for the Operational Programme management, and for the execution of their specific tasks in relation to this Operational Programme. A detailed organigramme of the Operational Programme management is provided in Annex V.
5.1.2. Separation of functions In accordance with the Article 21.2 of the IPA Implementing Regulation, the appropriate segregation of duties will be ensured between and within the designated bodies.
99 Separation of functions between the bodies The separation of functions results from a division of tasks as described above. This includes the following principles: − on the one hand, a clear separation between verifications, controls, and evaluations to be carried out by the Operating Structure and by the National Fund; and on the other − a clear separation between the audits carried out by the Audit Authority and the implementation and payment procedures. Separation of functions within the bodies The organisational structure of the bodies and their internal management and control procedures will take into account all requirements to ensure a proper separation of functions. This includes the following principles: − before an operation is authorised, the operational and financial aspects shall be verified by members of staff other than the one responsible for initiation or implementation of the operation; − certificates of statement of expenditure shall be drawn up by a person or department within the National Fund who is functionally independent from any services that approve claims; − the initiation, ex-ante, and ex-post controls are separate functions, to be carried out by different persons, functionally independent from each other.
5.2. MONITORING AND EVALUTION 5.2.1. Monitoring arrangements In order to ensure coherence and coordination in the implementation of the IPA components, programmes and operations, as well as to follow the progress in the implementation of IPA assistance, the following monitoring committees will be established: IPA Monitoring Committee; Sectoral Monitoring Committee for the Environmental Protection Operational Programme. IPA Monitoring Committee Croatia will establish an IPA Monitoring Committee to ensure coherence and coordination in the implementation of all five Components of IPA. The IPA Monitoring Committee shall include: (A) representative(s) of the European Commission; The National IPA Coordinator; The Competent Authorising Officer; The National Authorising Officer; The Strategic Coordinator for Components III and IV; Representatives of the IPA Operating Structures. Sectoral Monitoring Committee The Head of the Operating Structure will establish a Sectoral Monitoring Committee within 6 months after the entry into force of the IPA Implementing Regulation This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting.
100 In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure in agreement with the European Commission. The Sectoral Monitoring Committee will be assisted by a permanent secretariat provided by the Operating Structure for the preparation of papers for discussion by the Committee or for clearance by written procedure. The secretariat will be established within the Ministry of Environment Protection, Physical Planning and Construction - the Directorate for Strategic and Integration Processes in Environmental Protection (Sector for EU). The Sectoral Monitoring Committee will report to the IPA Monitoring Committee. Its tasks will include: a. Considering and approving the general criteria for selecting the operations and approving any revision of those criteria in accordance with programming needs; b. Reviewing at each meeting progress towards achieving the specific targets of the Operational Programme on the basis of documents submitted by the Operating Structure; c. Examining at each meeting the results of implementation, particularly the achievement of the targets set for each priority axis and measure, as well as interim evaluations (it shall carry out this monitoring by reference to the indicators agreed). Information on the number of jobs created as a result of the implementation of individual projects should be specifically reported and monitored (this information has to be forwarded to IPA Monitoring Committee); d. Examining the sectoral annual and final reports on implementation, including OP summary tables; e. Being informed of the annual audit activity report or of the part of the report referring to the Operational Programme; f. Examining any proposal to amend the financing agreement for the programme and proposals to the Operating Structure for any revision or examination of the Programme likely to make possible the attainment of the programme's objectives, or to improve its management, including its financial management, as well as to oversee cross cutting themes and publicity measures. The Sectoral Monitoring Committee shall confirm or make proposals to the Head of the Operating Structure, to the European Commission, the Strategic Co-ordinator and the National IPA Co-ordinator to revise the programme, where relevant, following an evaluation, including its results, as well as the output and financial indicators to be used to monitor the assistance. The Sectoral Monitoring Committee will set up its rules of procedure in agreement with the Operating Structure and the IPA Monitoring Committee. It will meet at least twice a year and upon request by the Commission. Intermediate meetings may also be convened as required. As a principle the Sectoral Monitoring Committee will aim to take decisions by reaching consensus. 5.2.2. Management Information System The Head of the Operating Structure is responsible for the efficiency and correctness of management and implementation and in particular for setting up, maintaining and updating regularly a reporting and information system to gather reliable financial and statistical information on implementation, for the monitoring indicators and for evaluation and for forwarding this data in accordance with arrangements agreed between the NIPAC and the Commission. This system will be developed into one or several computerised system(s), in a form chosen by the Operating Structure, which will enable it to: Monitor and manage the implementation of operations and projects, from the moment of tendering and call for proposal to the closure of the OP, in particular results whenever feasible, and outputs; Carry out and monitor financial transactions; Ensure the reporting requirements on the implementation of the OP.
101 The Operating Structure and all other bodies involved in the implementation of the OP shall have access to this system. The Management Information System will be developed under the Technical Assistance component of this Operational Programme. The establishment of the Management Information System will be done under the guidance and supervision of NIPAC and Strategic Coordinator, in order to ensure consistency and complementarity across all the Operational Programmes. Until the system becomes operational, reporting and collection of data will be done manually. 5.2.3. Monitoring System and Indicators The quantitative and qualitative progress made in implementing the programme, as well as its efficiency and effectiveness in relation to its objectives, will be measured by the use of evaluation and monitoring indicators related to the results and outputs of the individual measures. In identifying appropriate monitoring and evaluation indicators, account has been taken of the methodologies, guidelines and lists of examples of indicators issued by the Commission, in particular the "Indicative guidelines on evaluation methods: Monitoring and evaluation indicators" (August 2006, working document No. 2 for the programming period 2007-2013). The Head of the Operating Structure is responsible for programme monitoring. In this context, the Operating Structure will collect performance data (outputs, results and expenditure) from operations and projects. It will establish, maintain and update the reporting and information system by taking this project-level data and aggregate it to measure, priority axis and whole OP levels. Data on individuals who are the ultimate beneficiaries must be collected for each project and used for aggregation at measure and priority level. On this basis the Operating Structure will assess the progress of the OP at each level against objectives and targets, prepare reports to the Sectoral Monitoring Committee, draft the sectoral annual and final reports on implementation and launch interim evaluations if required. In the context of monitoring and for the purpose of using indicators, the role of the Operating Structure will also be to ensure that: a. Monitoring requirements are built into the calls for tender and proposals documents (including preparation of the major project application forms, terms of reference and tender documentation); b. Project applications (when appraised and selected) include proposed outputs and results, as well as data on individuals, that are consistent with the OP indicators for the appropriate measure; c. Provision of data is built into the contract with beneficiaries as an obligation, and that performance data is provided systematically and in a timely manner by beneficiaries alongside the project reimbursement claim; An indicative breakdown by category of the programmed use of the Community contribution to this Operational Programme will be established for monitoring and information purposes while the sectoral annual and final reports on implementation will provide information on the use of expenditure in accordance with such categories. 5.2.4. Selection of operations All operations which are not major projects, and which are implemented by final beneficiaries other than national public bodies, shall be selected through calls for proposals. The Operating Structure will set up a Selection Committee for each call for proposals launched for the selection of operations financed under a specific measure. The Selection Committee will have an odd number of members and it will be composed of the most appropriate officials and experts with technical competence to undertake a qualitative appraisal of project applications. These members will be nominated by the institutions in which where they are employed at the invitation of the body in charge of implementation and they will have voting rights in the selection process. A member of the Operating Structure who prepared the guidelines for applicants will also participate in the Selection Committee's work. The Committee will be chaired by a member of the Implementing Body without a voting right. The Selection Committee will appraise project applications in compliance with the selection criteria and methodologies agreed by the Sectoral Monitoring Committee. The applications will first be screened for their compliance with the eligibility and administrative criteria meeting the relevant eligibility requirements set out in the relevant measures (completeness, accuracy, etc) and thereafter will be evaluated
102 according to their quality. The Selection Committee will then make recommendations to the Operating Structure, in compliance with Article 158 of the IPA Implementing Regulation. Procurement (including the award of any major projects) will follow contract award procedures contained in of the "Practical Guide to Contract Procedures for EC External Actions" (PRAG). Tender Selection Committees will be established for the evaluation of service, works and supply tenders, while their composition and decision making procedures will be in accordance with the principles set out in the relevant rules of the PRAG. All beneficiaries (whether public or private) will also comply with the principles established under the relevant PRAG rules. 5.2.5. Sectoral annual and final reports on implementation Annual and final sectoral implementation reports will be prepared by the Operating Structure in accordance with Article 169 of the IPA Implementing Regulation. These reports will assess the implementation progress covering the attainment of set objectives, the problems encountered in managing the programme and the measures taken, financial execution, as well as the monitoring and evaluation activities carried out. This will include specific progress reports on each major project, in accordance with the format to be agreed with the Commission. 5.2.6. Evaluation arrangements Evaluations are a tool for assessing the relevance, efficiency and effectiveness of the financial assistance as well as the impact and sustainability of the expected results. As a minimum, an ex-ante evaluation and interim evaluations will be carried out under the responsibility of the Head of the Operating Structure in accordance with the principles laid down in the IPA Implementing Regulation and guidance provided by the Commission. The evaluation arrangements and activities of each programme will fully respect the principle of proportionality. Ex ante evaluation Under the responsibility of the Operating Structure, an ex ante evaluation of the Environment Protection Operational Programme has been carried out by the European Policy Research Centre at the University of Strathclyde in Glasgow and is annexed to the programme. A summary of the results of the ex-ante evaluation and the way the evaluation was conducted is set out in section 1.4. Interim evaluation During the implementation of the programme, interim evaluations complementing the monitoring of the Environmental Protection Operational Programme will be carried out, in particular where this monitoring reveals a significant departure from the goals initially set or where proposals are made for the revision of the programme. At any rate, evaluations are planned to provide data on indicators agreed upon in the OP that cannot be obtained through the monitoring system. In addition, strategic evaluations or thematic evaluations can be carried out under the responsibility of the Operating Structure and/or CODEF. The results will be sent to the ad-hoc committee on evaluations, to the Sectoral Monitoring Committee and to the Commission. Evaluation function The Head of the Operating Structure is responsible for ensuring that adequate evaluations of the Operational Programme are carried out. The evaluations will be carried out by external experts, functionally independent from the management and control system. The evaluations will be managed by a designated IPA staff member within the Ministry of Environmental Protection, Physical Planning and Construction, who will be responsible for preparing the documents for tendering and contracting these experts under Priority Axis 3, reviewing the draft evaluation reports, acting as secretariat to the ad hoc Evaluation Committee, and liaising, as appropriate, between the selected experts and the said Committee. Evaluation committee The Sectoral Monitoring Committee will designate an ad-hoc committee to assist the Operating Structure in its evaluation activities. The Committee will adhere to the 'partnership principle' and will include members (and invitees where relevant) who are experts in evaluation. Moreover, the assistance of the Committee will be availed of at all stages of the process (including guidance, planning, implementation and communication of results) in order to ensure the overall quality of the evaluations undertaken. At the same time, all relevant stakeholders and institutions/organisations will be invited to contribute where appropriate.
103 The designation and establishment of this ad-hoc Committee will be made in accordance with the Sectoral Monitoring Committee’s rules and procedures adopted in accordance with Article 167.2 of the IPA Implementing Regulation. Evaluation activities and timing Given that this programme covers the 2007-09 period, but involves operational activity up to 31 December 2012 under the N+3 rule, it is proposed that only one interim evaluation is carried out, and that this will commence in October 2009. As no major projects will have been completed at this stage, this would be effectively a process evaluation examining the efficiency and effectiveness of programme and project implementation, but within the context of the progress made with implementation, including the performance against indicators at the project level (physical and financial objects) and at the measure level (outputs). This will also include a review of performance on the horizontal themes of the OP.
5.3. INFORMATION AND PUBLICITY 5.3.1. Introduction Information and publicity are important aspects of pre-accession assistance and in particular to the successful design and delivery of the Operational Programmes, given the partnership basis on which they are undertaken. Communicating for the successful management and implementation of the Operational Programmes is broken down into a series of information and publicity activities. To this end, Article 62 of the IPA Implementing Regulation sets out certain requirements regarding the information to be provided and publicity of programmes and operations financed by the Community, addressed to citizens and beneficiaries with the aim of highlighting the role of Community funding and ensuring transparency. Accordingly, the information to be provided by the Operating Structure should include inter alia the publication of the list of final beneficiaries, the names of the operations and the amount of Community funding allocated to operations. The Commission must also ensure the publication of the relevant information on tenders and contracts in the Official Journal of the European Union and other relevant media and websites. Moreover, Article 63 of the IPA Implementing Regulation provides further that the Commission and the relevant authorities of the beneficiary country shall agree on a coherent set of activities, to be funded from the Technical Assistance priority of the Operational Programme, in order to make available and publicise information about IPA assistance. In accordance with the above-mentioned provisions the Ministry of Environment Protection, Physical Planning and Construction (the Directorate for Strategic and Integration Processes in Environmental Protection) shall be responsible for the information and publicity activities under the Programme. For all information and publicity activities related to the water management component, the Ministry of Environment Protection, Physical Planning and Construction will closely cooperate with and obtain its information from the Ministry of Agriculture, Forestry and Water Management. The information shall be addressed to the citizens of Croatia and to the European citizens in general, and to the (potential) beneficiaries. It shall aim to highlight the role of the Community and ensure that IPA assistance is transparent. 5.3.2. Requirements In compliance with Article 63 of the IPA Implementing Regulation the Ministry of Environmental Protection, Physical Planning and Construction (the Directorate for Strategic and Integration Processes in Environmental Protection) in cooperation with the Ministry of Agriculture, Forestry and Water Management will formulate a coherent set of strategic activities, a Communication Action Plan (CAP), to provide strategic coherence to the set of activities to publicise information about IPA assistance. The CAP shall be consistent with the information and publicity strategy issued by NIPAC. The CAP shall cover the period 2008-2012. The Ministry of Environmental Protection, Physical Planning and Construction (the Directorate for Strategic and Integration Processes in Environmental Protection) will submit a draft of the CAP to the NIPAC and the Commission within four months of the date of signature of the Financing Agreement covering the Operational Programme. As a minimum the CAP shall include the following points: • The aims and target groups;
104 • The strategy and content; • The indicative budget; • The administrative departments; • The criteria used for evaluation of project proposals.
5.3.3. Activities The Ministry of Environmental Protection, Physical Planning and Construction (the Directorate for Strategic and Integration Processes in Environmental Protection) shall ensure that the information and publicity measures are implemented in accordance with the CAP aiming at the broadest possible media coverage using all suitable forms and methods of communication at the appropriate territorial level. The Ministry of Environmental Protection, Physical Planning and Construction (the Directorate for Strategic and Integration Processes in Environmental Protection) will be also responsible for organising at least the following information and publicity measures in cooperation with the Ministry of Agriculture, Forestry and Water Management: • A major information activity publicising the launch of an Operational Programme, even in the absence of the final version of the CAP; • At least one major information activity a year, as set out in the CAP, presenting the achievements under the Operational Programme (including major projects where appropriate); • The publication (electronically or otherwise) of the list of beneficiaries, the names of the operations and the amount of Community and national funding allocated to the operations The Ministry of Environmental Protection, Physical Planning and Construction (the Directorate for Strategic and Integration Processes in Environmental Protection) and the Ministry of Agriculture, Forestry and Water Management shall provide potential beneficiaries with clear and detailed information on at least the following: • The possibility of financing opportunities offered jointly by the Community and the beneficiary country through the OP; • The conditions of eligibility to be met in order to qualify for financing under the Operational Programme; • A description of the procedures for examining applications for funding and of the time periods involved; • The criteria for selecting the operations to be financed; and • The contacts at national, regional or local level that can provide information on the Operational Programme. 5.3.4. Indicative budget The indicative budget for the CAP under this Operational Programme for the period 2007-2009 will be set at an appropriate level in order to provide adequate cover for the costs of the publicity and information measures. The budget allocation per year, as well as the indicative amounts necessary for the period 2010-2013 will also be presented in the CAP. 5.3.5. Management and implementation Within the Ministry of Environmental Protection, Physical Planning and Construction, information and communications will be assigned to the Directorate for Strategic and Integration Processes in Environmental Protection. The information and publicity team will be composed of 2 IPA staff members whose tasks will involve supporting the Head of the Operating Structure in the performance of the following functions and responsibilities: • Discussing the CAP with the NIPAC and the Commission; • Coordinating the information and publicity activities under other IPA funded programmes; • Communication with the media; • Elaboration, implementation and assessment of the programme's CAP;
105 • Representing the programme in the relevant national and Commission information networks; • Handling enquiries from beneficiaries; • Monitoring and control on the fulfilment of the P&I requirements from the beneficiaries; • Development, production and distribution of information materials; preparation and implementation of public events; • Development and maintenance of the contents of the Programme website; • Liaising with IT regarding technical maintenance; • Management of out-sourced services; • Elaboration and monitoring the annual CAP and coordination of internal events and training. Given that some of the information and publicity measures will require out-sourcing for professional services (such as design and pre-print, web page, printing, advertising, photography and opinion pools). It will be the responsibility of the information and publicity team to manage such services and ensure that the contract is concluded in accordance with public procurement rules. 5.3.6. Monitoring, evaluation and reporting Monitoring, evaluation and reporting are a compulsory requirement for the implementation of the publicity measures included in the CAP of the programme. The progress made in the implementation of the CAP shall be reported during the meetings of the Sectoral Monitoring Committee. Moreover, the Head of the Operating Structure shall inform the Sectoral Monitoring Committee of the information and communication measures carried out and the means of communication used. The Head of the Operating Structure will also provide the Sectoral Monitoring Committee with examples of communication measures carried out. The annual and final reports on implementation of the Operational Programme will include the following information: • Examples of information and communication measures for the Operational Programme undertaken in implementation of the CAP; • The arrangements for the information and publicity measures concerning the publication, electronically or otherwise, of the list of beneficiaries, the names of the operations and the amount of public funding allocated to the operations; • The content of major amendments to the CAP; • The set of indicators for evaluation of the publicity measures which have been included in the CAP to assess the efficiency and effectiveness of the implemented publicity activities; • The yearly results of the qualitative and quantitative analysis which have been used for the elaboration of the annual CAP and any modifications thereof. 5.3.7. Partnership and networking Bodies that can act as relays for the programme and disseminate the information concerning the general public are the following: • Professional and trade associations and organizations; • Economic and social partners; • Non-governmental organisations; • Educational institutions; • Organisations representing business; • Operators;
106 • Information centres in Europe and Commission representations, in particular the EC Delegation; • Other main stakeholders under each priority axis. The Operating Structure will work in close cooperation with the above-mentioned bodies for the dissemination of information regarding the programme and in particular the IPA pre-accession assistance strategy for component IV.
5.3.8. Internet The website of the programme will be linked to the CODEF, MFIN, ECD, DG ELARG, DG EMPL and DG REGIO websites and with the websites of the other programmes. It will be created according to the following principles: • Accessibility to as many users as possible – ensuring the site has a simple address; registering it on main search engines so it can be found easily; designing it to be viewable with low specification screens and software; ensuring it is quick to download; • Prioritising fast access to rich information – the site should be clearly organised so users can find what they are looking for quickly and easily; the information should be available as downloadable pdf documents, where possible; • Visual appeal – strong visual identity through logos, use of colours etc. without limiting the clarity, speed and simplicity; • Developing as an ongoing resource; • Interactive content, exploiting the unique strengths of websites.
107 ANNEXES
ANNEX I: MEMBERSHIP OF INTER-MINISTERIAL WORKING GROUP (IWG)
(Note: * indicates designated lead ministry for managing the OP)
Central Office for Development Strategy and Coordination of EU Funds (CODEF) - Ms Nataša Mikuš, Deputy State Secretary (Chair, IWG) - Ms Ivana Vlašić, Head of Department, - Mr Damir Tomasović, Head of Section
Ministry of Environmental Protection, Physical Planning and Construction (MEPPPC)* - Mr Daniel R. Schneider, Assistant Minister - Ms Mirjana Papafava, Head of Department
Ministry of Agriculture, Forestry and Water Management (MAFWM) - Ms Karmen Cerar, Head of Department
Ministry of Foreign Affairs and European Integration (MFAEI) - Ms Maja Kušt
Central Bureau of Statistics - Ms Vesna Koletić, Senior Expert Advisor
CARDS 2003: Support to National Development Planning - Mr Conor Kearney
108 ANNEX II: MONITORING INDICATORS51
Monitoring indicators Result indicator for each Priority axes and output indictors for each measure are provided. Final target i.e. achievements under most of the priorities/measure are set on the basis of the projects envisaged to be carried in the programming period covered by this Operational programme52. Targets will be possible to asses at the end of the programme due to the nature of project envisaged in the EPOP (large scale infrastructure projects that require certain time to be conducted).
Having in mind limited scale and likely influence of the programme it is unlikely to asses the consequences of the programme beyond the immediate effects and that is why no impact indicators (environmental impact at programme level) are provided.
The main source for data gathering will be monitoring reports (project ones but also annual and final reports on implementation).
Measure Baseline Frequency of Final Definition Type ment Data source data (year) reviewing target* unit Priority axis 1- Developing waste management infrastructure for establishing an integrated waste management system in Croatia Population served by the 0 3-years MEPPPC, final 1 new waste management Result Nr 940.000 (2007) period* beneficiary centres
Reduction of waste 0 3-years MEPPPC, final 2 Result % 30 deposited in the landfills (2007) period* beneficiary
Measure 1.1. Establishment of new waste management centres at county / regional levels MEPPPC, Established (opened) new 0 Project 1 waste management Output Nr annually 3 (2007) monitoring centres reports MEPPPC, Projects applications 0 project 2 submitted with full Output Nr annually 3 (2006) monitoring documentation reports Measure 1.2 – Remediation of sites highly polluted with waste (hot spots)
MEPPPC, Documentation for “hot 0 project 1 spot” remediation projects Output Nr annually 1 monitoring prepared (2007) reports
Priority axis 2 - Protecting Croatia's water resources through improved water supply and integrated wastewater management system Population connected to 0) 3-years MAFWM 1 rehabilitated water supply Result Nr 100,000 (2007) period* network
51 Monitoring Indicators for all Priority axes and Measures are brought together into one section following recommendation from Ex-ante Evaluation report (Chapter 7) 52 For that reason 2007 is taken as a baseline year and majority of baseline values are zero. On the other hand the final targets present what is expected to be achieved during the given period (2007-2009), but those could be even exceeded.
109 Measure Baseline Frequency of Final Definition Type ment Data source data (year) reviewing target* unit Population connected to 0 3-years 105,000 MAFWM 2 new/rehabilitated Result Nr (2007) period* PE sewerage network
Population served by the 0 3-years 105,000 MAFWM 3 Result Nr new WWTP (2007) period* PE
Measure 2.1. Establishment of modern water supply systems and networks MAFWM Municipal 0 companies , 1 New water supply network Output km annually 7 (207) project monitoring reports MAFWM Municipal Rehabilitated / replaced 0 companies , 2 Output km annually 20 water supply network (2007) project monitoring reports MAFWM, Water Supply project 0 project 3 applications with full Output Nr annually 2 (2006) monitoring documentation reports Measure 2.2. Construction of WWTP for domestic and industrial wastewaters and upgrading of sewerage network MAFWM Municipal New/rehabilitated WWTP 0 companies , 1 Output Nr annually 3 compliant with EU aquis (2007) project monitoring reports MAFWM Municipal Sewerage network 0 companies , 2 construction / Output km annually 50 (2007) project refurbishment monitoring reports MAFWM, Waste Water project 0 project 3 applications with full Output Nr annually 4 (2006) monitoring documentation reports
Priority axis 3 - Technical assistance Staff in the national bodies capable of independently 0 3-years MEPPPC, 1 identifying, preparing and Result Nr 40 (2007) period* MAFWM assessing project applications
0 3-years MEPPPC, 2 OP funds absorbed Result % 100 (2007) period.* MAFWM
110 Measure Baseline Frequency of Final Definition Type ment Data source data (year) reviewing target* unit Measure 3.1. Programme management Trainings provided for the public bodies for the implementation of PA 1 Project 0 1 and PA 2 including Output Nr annually 10 monitoring (2007) trainings in preparation reports and assessment of project applications Waste project applications 0 2 assessed and submitted Output Nr (2006) annually 3 MEPPPC by Operating Structure Water project applications 0 3 assessed and submitted Output Nr annually 6 MAFWM (2006) by Operating Structure Project Monitoring Committee 0 4 Output Nr annually 4 monitoring meetings (2007) reports
* Envisaged date for measuring final target is set at the end of programme, i.e. end of 2012. That is due to the time coverage of the OP but also due to the nature of envisaged projects and "n+3" rule
111 ANNEX III: INDICATIVE LIST OF PROJECTS AND THEIR IDENTIFICATION CARDS
Priority Measure Project Estimated axis preparation value of Project name support projects M€ Regional Waste Management Centre Marišćina Measure 1.1 41.78 (The County of Primorje and Gorski Kotar) Regional Waste Management Centre for the County Measure 1.1 CARDS 2002 55.7 of Split –Dalmatia
Regional Waste Management Centre for the County Measure 1.1 EBRD 45 of Istria
Remediation and closing down of the Sovjak pit, Measure 1.2 IPA 25 County of Primorje-Gorski Kotar
Waste Management Centre for the County of CARDS 2002 Measure 1.1 24.8 Dubrovnik-Neretva IPA Regional Waste Management Centre for County of Measure 1.1 IPA 35.9 Zadar Waste Management Centre for County of Virovitica- Measure 1.1 IPA Podravina Waste Management Centre for North-West Croatia Measure 1.1 IPA
Waste Management Centre for East Slavonia Measure 1.1 IPA integrated waste management system in Croatia
Waste Management Centre for Karlovac County Measure 1.1 IPA
Waste Management Centre for Brodsko-Posavska Measure 1.1 IPA County Waste Management Centre for Sisak-Moslavina PRIORITY AXIS 1 – Developing waste management infrastructure for establishing an Measure 1.1 IPA County
112
Priority Axis 1 - Developing waste management Project No: 1 infrastructure for establishing an integrated waste Measure No.: 1.1. management system in Croatia Project location: The County of Primorje and Gorski Kotar
1. Project name Regional Waste Management Centre Marišćina 2. Investment value 54.026.732 EUR (estimated) Establishment of the RWMC “Marišćina” (Stage I) • Weighing bridge and waste registration at the Centre’s entrance, and car-tyre wash • Plateaus in the operating zone • Mechanical and biological treatment plant (MBT) • Phase 1 of the landfill area, including the collection and flare-burning of landfill gas 3. Description of main • Wastewater and leachate treatment system project components • Buffer zone surrounding the operating zone and Phase 1 of the landfill and/or activities • The Centre’s internal infrastructure (roads, parking lots, water supply, drainage, electrical installations)
Technical Assistance in public awareness rising and supervision of the works.
For IPA funding construction of new RWMC (without MBT facilities) and technical assistances is being proposed.
Main project objectives and expected results include: • Adopting modern methods of treating unsorted municipal waste allowing for treatment in available thermal processing units (RDF for cement plants ) • Creating optimal transportation routes between the “Marišćina” and the system’s external facilities 4. Description of main • Developing the infrastructure (set up the facilities for collection, transportation, project objectives receiving and treating of the all type of wastes with exception of the treatment of and expected results industrial non-hazardous waste – to be treated within the frame of industrial producers of such a waste kind) • Implementing the AED concept and reducing the quantity of waste to be landfilled • Setting up an integrated waste management system in the County of Primorje and Gorski Kotar (with no landfills on the islands)
5. Month and year of 6. Month and up to 3 start of project year of end of years (for 2008 2010 7. Project duration (months) implementation project each implementation phase) 8. Readiness of basic project documentation Document type Regional Waste Management Centre Integrated waste management centre within the County: -Landfill s closure -Transfer stations -Recycling yards status status completion date status (tick status description completion date (tick description box) box)
Pre-feasibility study - - Feasibility study (with cost-benefit analyses which include - 2005 economic and financial analysis)
113 EIA study 2001 Under First half of Tender documents preparation 2008
Other
9. Status of project design documentation and permits status Status Status description Status description completion Completion Documentation type (tick (none/in (tick (none/in Comment date date box) progress/comple box) progress/comple ted) ted) Project part: Conceptual design completed 2004 - Preliminary design - - - Main design completed 2006 - Final design - Location Permit completed 2004 - Building Permit completed 2007 - Other 10. Description of the land ownership status: Solved
11. Describe current Final activities on the preparation of Centre’s infrastructure construction. project status
12. Name of final EKOPLUS Ltd. Rijeka 13. Name of Operator EKOPLUS Ltd. Rijeka beneficiary
14. Sources of financing:
National component (including final beneficiary) Croatian Financial Other donors: Institutions, IFI: Proposed IPA grant: MBT plant - PPP model Environmental protection and Energy Efficiency Fund, Local self-government units
14.247.130 EUR 15.000.000 EUR 11.425.280 EUR
• National Environmental Strategy - 2002 • Waste Act – 2004, 2006 15. Additional • Waste Management Strategy of the Republic of Croatia - 2005 comments: • National Waste Management Implementation Plan – 2007 Technical Assistance • Spatial Plan of the County of the Primorje and Gorski Kotar (CPG) –2000 Strategic documents • Waste Management Strategy of the CPG –2001 (plans, programmes, • Strategic development guidelines 2005 – 2009 for the CPG –2005 etc) • 2007–2015 Waste Management Plan of the CPG -2007 • Waste Management in the Region of Kvarner and Istria – 1996 • Final Study of the Environmental Impact of Facilities for Storing, Treating and Disposing of Municipal and Non – hazardous Industrial Waste in CPG
114 • Conceptual Design -2003 • Main Design for 1., 2. and 3. phase construction of RWMC – 2006 • Technological and Economic Concept for Establishing and Integrated Municipal and Non – hazardous Industrial Waste Management System in the CPG
Priority Axis 1 - Developing waste management infrastructure Project No: 2 for establishing an integrated waste management system in Measure No.: 1.1. Croatia Project location: County of Split-Dalmatia
1. Project name Regional Waste Management Centre for the County of Split-Dalmatia 2. Investment value 55.7 M EUR (approximately 34.0 M EUR first phase – to be calculated) (estimated) 3. Description of main Construction of an integral centre in which municipal and non-hazardous industrial project components waste from the territory of the entire county, including islands, shall be treated and and/or activities than disposed. The main objective is to establish integrated sustainable waste management system on county level (464,000 inhabitants). Main activities: • Construction of new WMC of the County of Split-Dalmatia including MBT facility-I 4. Description of main phase project objectives • Construction of 4 transfer stations (TS) on islands and 4 TS in the mainland and expected results • Optimizing of waste transport from TS to the RWMC • Pilot study for separate collection of waste for town Split
For IPA funding the construction of WMC, transfer stations and pilot study is being proposed 5. Month and year of 6. Month and year of July July start of project end of project 7. Project duration (months) 36 2008 2011 implementation implementation 8. Readiness of basic project documentation Status Document type status description completion date comment (tick box) Pre-feasibility study Feasibility study (with cost-benefit analyses Under revision according to the which include completed 2007 National Waste Management economic and financial Implementation Plan analysis) EIA study completed 2006 To be tendered in 2007 and Tender documents completed in 2008
Other
9. Status of project design documentation and permits status description status Design type (none/in completion date comment (tick box progress/completed) Conceptual design
115 Preliminary design completed 2007 Main design none 2008 To be tendered in first quarter of 2008 Final design Location Permit 2007 To be issued until the end of 2007 Building Permit 2008 To be issued in 2008 Other 10. Description of the land ownership status: in procedure
11. Describe current project status
12. Name of final Regionalni centar čistog Regionalni centar 13. Name of Operator beneficiary okoliša Ltd. čistog okoliša Ltd.
14. Sources of financing:
National component (including final beneficiary) Environmental Other donors: protection and Energy IFI: PPP model of financing of Proposed IPA grant Efficiency Fund, Local MBT self-government units special municipal charges
Aprox. 4.0 MEUR EUR Aprox. 15.0 MEUR Aprox. 15.0 MEUR
15. Additional - TA support CARDS 2002 Comment: - Waste management strategy of the Republic of Croatia 2005 -Technical Assistance - National Waste Management Implementation Plan 2007 -Strategic documents - Environmental protection programme of Split-Dalmatia County, 2000 (plans, programmes, - Waste management programme of Split-Dalmatia County, 2000 etc) - Regional Operational Programme of Split-Dalmatia County
Priority Axis 1 - Developing waste management infrastructure Project No: 3 for establishing an integrated waste management system in Measure No.: 1.1. Croatia Project location: County of Istria
1. Project name Regional Waste Management Centre for the County of Istria 2. Investment value 45 M EUR (estimated) 3. Description of main project components Construction of new RWMC-Kaštijun including MBT facility and/or activities The main objective is to establish integrated sustainable waste management system 4. Description of main on a county level (206,344 inhabitants) project objectives Main activities: and expected results • Construction of new RWMC-Kaštijun including MBT facility
116 Waste reception area with weighbridge, office and staff buildings, maintenance workshop, parking area, wheel wash facility, fence, gate etc, Area reserved for recycling yard, Area reserved for C&D waste treatment, Area reserved for transport centre, MBT plant, Internal roads within the centre and within the disposal area, Disposal units complete with bottom liner, leachate drainage layer, drains and wells for leachate collection, Leachate and gas treatment plants, Mobile and stationary equipment etc. • Construction of four Transfer Stations • Vehicles for long range transport – between the transfer stations and the RWMC • Technical Assistance in public awareness arising and supervision of the works
For IPA funding construction of new RWMC (without MBT facilities), technical assistances and vehicles for long range transport and transfer stations is being proposed.
5. Month and year of 6. Month and year of up to start of project 2008 end of project 2011 7. Project duration (months) 3 implementation implementation years 8. Readiness of basic project documentation – The County of Istria has started activities supported by the EBRD on developing of project documentation Status Document type status description completion date comment (tick box) Pre-feasibility study Feasibility study (with cost-benefit analyses Under End of August which include development 2007 economic and financial analysis) EIA study 2007 Under First half of Tender documents development 2008
Other (specify)
9. Status of project design documentation and permits Status status description Documentation type (tick (none/in completion date comment box) progress/completed) Conceptual design 2007 Preliminary design Main design Final design Location Permit Building Permit Other 10. Description of the land ownership status: Solved; permitted the construction of Centre for 30 years For RWMC - Kaštijun is necessary to do: • complete basic design in phases in such a way that each phase forms one complete entity; 11. Describe current • complete a feasibility study taking the phases of the project into consideration; project status • complete a cost-benefit analysis for the whole project; • complete an Environmental Impact Study; • complete the process to estimate the effect on the environment in accordance
117 with the ordinances in national laws, which includes public insight; • apply for and receive a location permit for the entire project; • complete the main and implementation projects according to phases; • apply for and receive a construction permit for the realisation of the individual phases of the Project; • complete tender documentation for construction. RWMC – Kaštijun, as a recycling and transfer station in the Region of Istria, will be managed by a company formed through the 12. Name of final cooperation of the City of Pula 13. Name of Operator beneficiary and the Region of Istria with possibility to join all towns and municipalities in Region of Istria (39). The registration of this firm is currently underway.
14. Sources of financing:
National component (including final beneficiary) loans from Croatian Financial Institutions, Other donors: IFI: Environmental MBT plant - PPP model Proposed IPA grant. EBRD protection and Energy Efficiency Fund, Budget of County of Istria, local self- government units
6.675 MEUR 4.500 MEUR 14.700 MEUR 19.125 MEUR
9 EBRD Technical Assistance for preparation of project documentation 15. Additional 9 Waste management strategy of the Republic of Croatia - 2005 Comment: 9 National Waste management implementation plan – 2007 Technical Assistance 9 Waste management plan of the County of Istria (drafted) Strategic documents 9 Final report-The waste management study in the Kvarner and Istrian regions, (plans, programmes, 1996 etc) 9 Physical plan of the County of Istria 9 Regional solid waste management plan, March 2006 9 Regional Operational Programme (ROP), June 2006
118
Priority Project name Measure Project preparation Total M€ axis support Slavonski Brod Measure 2.1. DABLAS /DISF – Measure 2.2. Feasibility study with 27 cost benefit analyses Knin - Drniš Measure 2.2. EC support CARDS - ROP Feasibility study 16.4 with cost benefit analyses
ough improved water Osijek Measure 2.1. DABLAS/DISF Measure 2.2. Feasibility study with 20 cost benefit analyses Vukovar Measure 2.2. DABLAS /DISF Feasibility study with 19 cost benefit analyses water resources thr
e water management systems Bjelovar-Bilogora Measure 2.1. ISPA TA 55
Koprivnica-Krizevci Measure 2.1. ISPA TA 52
Nova Gradiska Measure 2.2. ISPA TA 13 Djakovo Measure 2.2. ISPA TA 16.5 Sisak Measure 2.2. ISPA TA / EBRD 31 Vrbovec Measure 2.2. IPA TA 6 supply and integrated wast Krapina Measure 2.2. IPA TA 5.8 Velika Gorica Measure 2.2. IPA 5.5 Samobor Measure 2.2. IPA 10
PRIORITY AXIS 2 – Protecting Croatia’s Dugo Selo Measure 2.2. IPA 14.8
119
Priority axes 2 – Protecting Croatia Water resources Project No: 1 through improved water supply and integrated waste Measure No: 2.1., 2.2. water system Project location: SLAVONSKI BROD 1. Project name Water Infrastructure Improvement in town Slavonski Brod 2. Investment value 27.000.000 EUR (estimated) Construction of central waste water treatment plant for 80.000 PE, mechanical and biological treatment technology units and solution for the sludge disposal for the 3. Description of main municipal wastewaters. project components Extension of the sewerage network and construction of new mains (L=45 km, φ 400- and/or activities 1400 mm, 5 Pumping station, 17 Relief structures). Construction of the water supply network (L=14 km, φ 300-400 mm, 1 Water reservoir) Protection of water supply zone. 4. Description of main Protects of the river Sava water quality, as local recipients. project objectives Solution for disposition of the waste waters of Town Slavonski Brod and surrounding and expected results settlements. 5. Month and year of 6. Month and year of start of project 2007 end of project 2010 7. Project duration (years) 3 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study finished Feasibility study (with cost-benefit analyses which includes finished 2006. economic and financial analysis) EIA study in progress end 2007. Tender documents Other (specify): 9. Status of project design and permits Status status description Documentation type (tick (none/in completion date comment box) progress/completed) Project part 1 – Sewerage –network Conceptual design Explanation in point 11 Preliminary design Main design Final design Location Permit Building Permit Other (specify): Project part 1 – Sewerage –WWTP Conceptual design Explanation in point 11 Preliminary design Main design Final design
120 Location Permit Building Permit Other (specify): Project part 2 – Water supply Conceptual design Explanation in point 11 Preliminary design Main design Final design Location Permit Building Permit Other (specify): 10. Description of the land ownership status: property of “Vodovod i kanalizacija” Slavonski Brod Project part 1 Sewerage For the mains and network: Readiness of project design varies in catchment’s areas. Some parts of sewerage and water supply network are already built or Building Permit is in progress, and for some parts the preparation of Preliminary design is in progress. Bellow is description of nowadays sewerage network status according to Conceptual design solution for the whole sewerage system. In this nomination all mains and network which are in phase of issuing Building permit or designing are included in this nomination. Existing status of Sewerage mains and network- out of 100% of catchments area Catchment area A – 10% built – 90% Building Permit finished – included in investment Catchment area B – B1, B2, B3 50% built, 50 % Building Permit finished – B4, B5, B.8.3. Conceptual design in progress Catchment area C – built Catchment area D – 20% built – 80% Conceptual design in progress Catchment area E 11. Describe current – 30% Conceptual design in progress project status – 70% Building Permit in progress Catchment area F – 10% built – 90% Building Permit in progress Catchment area G – 30% built – 50% Building Permit in progress – 20% not planed for construction
For WWTP it is needed to: • design Conceptual and Preliminary Design • prepare EIA Study • obtain Location Construction Permit • design Detail designs and • obtain Construction Permit
Project part 2 Water supply (generally): Construction of major and main pipelines, additional water reservoir and reconstruction of main nodes - 25% has a Building Permit, 7% has a Location Permit, 50% has no project design documentation, 18% does not require any project documentation.
121 12. Name of the Final “Vodovod i kanalizacija” 13. Name of the “Vodovod i kanalizacija” beneficiary Slavonski Brod Operator Slavonski Brod 14. Sources of financing National component (including final IFI (specify) Other Donor (specify) Proposed IPA grant beneficiary) Local and State EIB Budget, CW 15. Additional DISF Consultants prepare Application for IPA (mid. 2007) Comment: -Technical Assistance -Strategic documents (plans, programmes, etc) :
122 Priority axes 2 – Protecting Croatia Water Project No: 2 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: KNIN DRNIŠ 1. Project name Water Infrastructure Improvement in Knin and Drniš 2. Investment value Knin 11,700,000 EUR, Drnis 4.700,000 EUR - Total 16.400.000 EUR (estimated) 3. Description of main project Improvement and rehabilitation of sewer network and water supply components Construction of waste water treatment plant in Knin for 20.000 PE and Drniš for 5.000 PE and/or activities 4. Description of main project Leak reduction in water supply system objectives and Reduction of environmental impact on Krka River and downstream functions expected results 5. Month and year of 6. Month and year od start of project 2007 end of project 2009 7. Project duration (years) 2 implementation implementation 8. Readiness of basic project documentation Document type status status description completion date comment Pre-feasibility study finished 2002 Sogreah framework Krka River Basin study Feasibility study (with cost-benefit analyses which approved Dec. 2006 Tebodin include economic and financial analysis) Knin:In process May 2007 EIA study Tebodin Drniš: Approved 2005
Tender documents
Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Knin Conceptual design finished 1998/2002 various revisions Preliminary design finished 2006 for sewers, water and WWTP Main design not started during project implementation Final design not started Location Permit just started July 2007 Building Permit not started By Contractor Other (specify): Project part 2: Drnis Conceptual design finished Preliminary design finished 2004-2007 for sewers and WWTP Main design finished Jan 2007 Final design approved (WWTP) only some small Location Permit June 2007 in process (sewer) parts for sewer Building Permit By Contractor Other (specify): 10. Description of the land ownership status: Drnis: ready, Knin: started 11. Describe current TA carried out in framework Cards 2006. Consultant undertakes activities and they in the project status progress as described above.
123 Knin Municipality and Knin Municipality and communal 13. Name of the communal Company, 12. Final beneficiary Company, Drniš Municipality and operator Drniš Municipality and communal company communal company 14. Sources of financing National component (including final IFI (specify) Other Donor (specify) Proposed IPA grant beneficiary) Local and State Loan Budget, CW 15. Additional TA carried out in framework Cards 2006 (Dec 2005 – March 2007) Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 3 resources through improved water supply and Measure No: 2.1. and 2.2. integrated waste water system Project location: OSIJEK 1. Project name Waste Water Treatment Plant of town Osijek 2. Investment value 20.000.000 EUR (estimated) 3. Description of main Construction of central waste water treatment plant for up to 250.000 PE, mechanical project components and biological treatment technology units and solution for the sludge disposal for the and/or activities municipal wastewaters. Protection of the river Drava and river Danube water quality. Improvement of the sanitary and hygienic conditions and solution for disposition of the 4. Description of main waste waters of City of Osijek and the surrounding settlements Antunovac, Cepin and project objectives South Baranja region with totally 150.000 citizens. and expected results Contribution to approximation of international conventions, and national and EU legislation (especially Urban Wastewater Treatment Directive 91/271/EEC)
5. Month and year of 6. Month and year of start of project 2008 end of project 2011 7. Project duration (years) 4 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date Comment
Pre-feasibility study finished 2004. Feasibility study (with Feasibility study was done by cost-benefit analyses BCEOM/JacobsGIBB in period 2004-2006 under the project Danube investment Support which include finished 2004. facility (ID number Europeaid economic and financial /116044/C/SV/MULTI). FS prepared in 2004. will analysis) be updated till April 2007. EIA study finished 2006 Tender documentation: Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment
124 Project part 1: WWTP Conceptual design finished 2004. Preliminary design in progress 2007. Main design Final design Location Permit Building Permit
Other (specify): 10. Description of the land ownership status: Elaborate with detection of WWTP site land ownership status is finished and issued by Vodovod_Osijek d.o.o. Osijek on the location of the WWTP is finished by the document issued by Vodovod-Osijek d.o.o. Osijek in 2005. The estimate of the land value is done in 2006. For WWTP it is needed to: 11. Describe current • Obtain Location Construction Permit, Location of the WWTP is known project status • Design detail designs and • Obtain Construction Permit 13. Name of the 12. Final beneficiary Vodovod-Osijek d.o.o. Vodovod-Osijek d.o.o. operator
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State EIB Budget, CW 15. Additional DISF Consultants prepare Application for IPA (mid. 2007) Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 4 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: VUKOVAR 1. Project name Main collectors and Waste Water Treatment Plant of town Vukovar 2. Investment value 19.000.000 EUR (estimated) Construction of central waste water treatment plant for 84.000 PE, mechanical and 3. Description of main biological treatment technology units and solution for the sludge disposal for the project components municipal wastewaters. and/or activities Construction of the connecting collector to WWTP (L=12,5 km, Gravity pipeline φ 800- 1500 mm, Pressure pipeline φ 450 mm, 3 Pumping stations, Siphon under river Vuka). Protection of the river Danube water quality 4. Description of main Improvement of the sanitary and hygienic conditions and solution for disposition of the project objectives waste waters of City Vukovar, Borovo naselje and the surrounding settlements. and expected results Contribution to the approximation of international conventions and national and EU legislation. 5. Month and year of 6. Month and year of start of project 2009 end of project 2012 7. Project duration (years) 3 implementation implementation 8. Readiness of basic project documentation
125 Document type status status description completion date Comment Pre-feasibility study in progress mid. 2007 Feasibility study (with cost-benefit analyses which include in progress mid. 2007 economic and financial analysis) EIA study in progress end 2007 Tender documents Other (specify): 9. Status of project design documentation and permits Design type status status description completion date Comment Project part 1: Conceptual design Preliminary design finished for WWTP Main design Final design Location Permit Building Permit Other (specify) 10. Description of the land ownership status: For the connecting collector it is needed to: • Finish preliminary and main designs • Obtain Location and Construction Permit 11. Describe the For WWTP it is needed to: current project status • prepare EIA study, Obtain Location Construction Permit • Design detail designs and • Obtain Construction Permit Vodovod grada Vukovara 13. Name of the Vodovod grada 12. Final beneficiary d.o.o. operator Vukovara d.o.o
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State
Budget, Croatian Water 15. Additional DISF Consultants prepare Application for IPA (mid. 2007) Comment: -Technical Assistance -Strategic documents (plans, programmes, etc).
Priority axes 2 – Protecting Croatia Water Project No: 5 resources through improved water supply and Measure No: 2.1. integrated waste water system Project location: COUNTY OF BJELOVAR - BILOGORA
1. Project name Construction of the County of Bjelovar-Bilogora regional water supply system 2. Investment value 55,000,000 EUR (estimated) 126 3. Description of main Construction of the regional water supply facilities (pipelines, storage tanks, pumping project components stations…) and/or activities 4. Description of main Increase of water supply degree project objectives Protection of the wellfield zone and expected results Improvement of drinking water quality 5. Month and year of 6. Month and year of start of project 2008 end of project 2013 7. Project duration (years) 5 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study finished Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study
Tender documentation
Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished Preliminary design in progress Main design in progress Final design in progress Location Permit in progress Building Permit in progress Other (specify)
10. Description of the land ownership status: It is necessary to: • develop the preliminary design; 11. Describe the • obtain a location permit; current project status • develop the final design; and • obtain a construction permit. 13. Name of the County of Bjelovar – 12. Final beneficiary County of Bjelovar – Bilogora operator Bilogora
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State
Bugdet, CW 15. Additional Project is nominated for ISPA TA Comment: -Technical Assistance -Strategic documents (plans, programmes,
127 etc).
Priority axes 2 – Protecting Croatia Water Project No: 6 resources through improved water supply and Measure No: 2.1. integrated waste water system Project location: COUNTY OF KOPRIVNICA - KRIŽEVCI
1. Project name Construction of the County of Koprivnica-Križevci regional water supply system 2. Investment value 52,000,000 EUR (estimated) 3. Description of main Construction of the regional water supply facilities (pipelines, storage tanks, pumping project components stations…) and/or activities 4. Description of main Increase of water supply degree project objectives Protection of the wellfield zone and expected results Improvement of drinking water quality 5. Month and year of 6. Month and year of start of project 2008 end of project 2013 7. Project duration (years) 5 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study finished Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study
Tender documentation
Other (specify):
9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished Preliminary design in progress Main design in progress Final design in progress Location Permit in progress Building Permit in progress Other (specify):
10. Description of the land ownership status:
128 It is necessary to: • develop the preliminary design; 11. Describe the • obtain a location permit; current project status • develop the final design; and • obtain a construction permit. County of Koprivnica – 13. Name of the County of Koprivnica – 12. Final beneficiary Križevci operator Križevci
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State
Bugdet, CW 15. Additional Project is nominated for ISPA TA Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 7 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: NOVA GRADIŠKA 1. Project name Waste Water Disposal System and Treatment Plant of town Nova Gradiska 2. Investment value 13.000.000 EUR (estimated) Construction of central waste water treatment plant for 26.000 PE, mechanical and 3. Description of main biological treatment technology units and solution for the sludge disposal for the project components municipal wastewaters. and/or activities Extension of the sewerage network and construction of new mains (collector K1 L=2 km, φ 600 – 1200 mm, Relieve structures). Protection of water supply zone. 4. Description of main Protects of the river Sumetlica water quality, as local recipients. project objectives Solution for disposition of the waste waters of Town Nova Gradiska and surrounding and expected results settlements. 5. Month and year of 6. Month and year of start of project 2009 end of project 2012 7. Project duration (years) 3 implementation implementation 8. Readiness of basic project documentation Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study Tender documentation Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished Preliminary design in progress 129 Main design not started Final design not started Location Permit not started Building Permit not started Other (specify):
10. Description of the land ownership status: property of “Slavca” Nova Gradiska For the mains and network: Mains and network are ready for construction. For WWTP it is needed to: 11. Describe the • design Main and Detail Designs current project status • prepare EIA Study • obtain Location Permit and Construction Permit Elaborate for bio-chemical waste water load is finished 13. Name of the 12. Final beneficiary “Slavca” Nova Gradiska “Slavca” Nova Gradiska operator
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State
Budget, CW 15. Additional Project is nominated for ISPA TA Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
130 Priority axes 2 – Protecting Croatia Water Project No: 8 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: DJAKOVO 1. Project name Waste Water Disposal System and Treatment Plant of town Djakovo 2. Investment value 16.500.000 EUR (estimated) Construction of central waste water treatment plant for 20.000 PE, mechanical and biological treatment technology units and solution for the sludge disposal for the 3. Description of main municipal wastewaters. project components Extension of the sewerage network and construction of new mains (industrial zone and/or activities collectors L=0,5 km φ 800 mm, main collector 1 L=3 km, φ 1000 mm , sewerage network in Đakovačka Satnica L= 16 km, φ 300 mm). Protection of water supply zone. 4. Description of main Protects of the river Sava water quality, as local recipients. project objectives Solution for disposition of the waste waters of Town Đakovo and surrounding and expected results settlements. 5. Month and year of 6. Month and year of start of project 2009 end of project 2010 7. Project duration (years 2 implementation implementation 8. Readiness of basic project documentation Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study Tender documentation Other (specify): 9. Status of project design documentation and permits completion Design type status status description comment date Project part 1: Conceptual design finished Preliminary design finished Main design Final design Location Permit Building Permit Other (specify):
10. Description of the land ownership status: property of«Komunalno poduzece» Đakovo For the mains and network: Mains and network are ready for construction. 11. Describe the For WWTP it is needed to: current project status • design EIA Study • obtain Location and Construction Permit • design Detail Designs and 13. Name of the «Komunalno poduzece» 12. Final beneficiary «Komunalno poduzece» Đakovo operator Đakovo
131 14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State Budget 15. Additional Project is nominated for ISPA TA Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 9 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: SISAK 1. Project name Waste Water Disposal System and Treatment Plant of town Sisak 2. Investment value 31.000.000 EUR (estimated) Construction of central waste water treatment plant for 74.000 PE, mechanical and 3. Description of main biological treatment technology units and solution for the sludge disposal for the project components municipal wastewaters. and/or activities Extension of the sewerage network and construction of new mains (many transporting collectors). Protection of water supply zone. 4. Description of main Protects of the river Sava water quality, as local recipients. project objectives Solution for disposition of the waste waters of Town Sisak and surrounding and expected results settlements. 5. Month and year of 6. Month and year of start of project 2009 end of project 2012 7. Project duration (years) 3 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study Tender documentation Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished Preliminary design finished Main design not started Final design not started Location Permit not started 132 Building Permit not started Other (specify): 10. Description of the land ownership status: property of “Sisacki vodovod” Sisak For the mains and network: • design Main and Detail design • obtain Location and Construction Permit 11. Describe the For WWTP it is needed to: current project status • obtain Location and Construction Permit • design EIA Study • design detail designs and 13. Name of the 12. Final beneficiary “Sisacki vodovod” Sisak “Sisacki vodovod” Sisak operator
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State Budget 15. Additional TA supported under EBRD Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 10 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: VRBOVEC 1. Project name Waste Water Disposal System and Treatment Plant of town Vrbovec 2. Investment value 6.000.000 EUR (estimated) Construction of central waste water treatment plant for 20.400 PE, mechanical and 3. Description of main biological treatment technology units and solution for the sludge disposal for the project components municipal wastewaters. and/or activities Construction of the connecting collector to WWTP (L=3,4 km, φ 500-800 mm, Releif structures) 4. Description of main Protection of water supply zone. project objectives Protects of the river Sava water quality, as local recipients. and expected results Solution for disposition of the waste waters of Town Vrbovec. 5. Month and year of 6. Month and year of start of project 2009 end of project 2011 7. Project duration (years) 2 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study finished Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study 133 Tender documentation Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design in progress 2007. Preliminary design in progress 2007. Main design Final design Location Permit Building Permit Other (specify):
10. Description of the land ownership status: property of “Komunalno poduzece” Vrbovec For the connecting collector: Location Permit is obtained and Construction Permit is in progress For WWTP it is needed to: 11. Describe the • Design EIA Study current project status • Reserve Location of the WWTP • Obtain Location Construction Permit • Design detail designs and • Obtain Construction Permit 13. Name of the “Komunalno poduzece” 12. Final beneficiary “Komunalno poduzece” Vrbovec operator Vrbovec
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State
Budget, CW 15. Additional Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 11 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: KRAPINA
1. Project name Waste Water Disposal System and Treatment Plant of town Krapina 2. Investment value 5.800.000 EUR (estimated) Construction of central waste water treatment plant for 20.000 PE, mechanical and 3. Description of main biological treatment technology units and solution for the sludge disposal for the project components municipal wastewaters. and/or activities Extension of the sewerage network and construction of new mains (L=4 km, φ 800mm) 4. Description of main Protection of water supply zone. project objectives Protects of the river Krapina water quality, as local recipients. and expected results Solution for disposition of the waste waters of Town Krapina and surrounding 134 settlements.
5. Month and year of 6. Month and year of start of project 2009 end of project 2012 7. Project duration (years) 3 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study finished Tender documentation Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished 2007 Preliminary design finished 2007 Main design Final design Location Permit Building Permit Other (specify):
10. Description of the land ownership status: property of Komunalno poduzeće Krapina For the mains and network: • Design detail designs and • Location Permit and Construction Permit are obtained 11. Describe the For WWTP it is needed to: current project status • Obtain Location Permit • Design detail designs and Obtain Construction Permit 13. Name of the Komunalno poduzeće 12. Final beneficiary Komunalno poduzeće Krapina operator Krapina
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary) Local and State
Budget, CW 15. Additional Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
135
Priority axes 2 – Protecting Croatia Water Project No: 12 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: VELIKA GORICA 1. Project name Wastewater Treatment Plant of town Velika Gorica 2. Investment value 5.500.000 EUR (estimated) 3. Description of main Reconstruction and upgrade of existing wastewater treatment plant in order to project components complete capacity of 70.000 PE (mechanical and biological treatment technology and and/or activities sludge solution included). Protection of water supply zone and lake Novo Čiče. Protection of Želin stream (recipient of I category) from untreated wastewaters’ 4. Description of main discharge. project objectives and Improvement of water quality (Sava river, Novo Čiče lake, Želin stream and Odra expected results river). Solution for disposition of surplus wastewaters of Velika Gorica town and surrounding settlements. 5. Month and year of 6. Month and year of start of project 2009 end of project 2011 7. Project duration (years) 2 implementation implementation 8. Readiness of basic project documentation Project part 2: WWTP Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study EIA study for existing plant (“Plan”, 1992.) Tender documentation Other (specify): 9. Status of project design documentation and permits Design type status status description completion date comment Project part 2: WWTP Conceptual design for recovery of plant Conceptual design in progress (“Hidroprojekt-Eko”, 1996.) Preliminary design Main design Final design Location Permit Building Permit Other (specify): 10. Description of the land ownership status: solved For the WWTP it is needed to: 11. Describe the current - Make EIA Study project status - Make: Preliminary, Main and Final Design - Obtain: Location and Building Permit “KOMUNALNA “KOMUNALNA 13. Name of the 12. Final beneficiary INFRASTRUKTURA” d.o.o. INFRASTRUKTURA” operator VELIKA GORICA d.o.o. VELIKA GORICA 14. Sources of financing
136 National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary)
15. Additional Comment: On a DABLAS priority list -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 13 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: SAMOBOR
1. Project name Wastewater Infrastructure Improvement in town Samobor 2. Investment value 10.000.000 EUR (estimated) Construction of central wastewater treatment plant for 40.000 PE with mechanical and 3. Description of main biological treatment technology and solution for the sludge disposal for the municipal project components wastewaters. Construction also includes third degree water treatment. and/or activities Sanation of sewage system. 4. Description of main Protection of water supply wellfield Strmec and protection of groundwater. project objectives Protection of Rakovica stream and Sava river. and expected results Improvement of water quality (Sava river and Rakovica stream). 5. Month and year of 6. Month and year of start of project end of project 7. Project duration (years) implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study finished Tender documentation
Other: Sanation of sewage system Study (2000.), Investment study (2006.)
9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished Preliminary design finished Main design not started Final design not started Location Permit valid Building Permit
137 Other (specify):
10. Description of the land ownership status: one part of the land for the plant must be bought Documentation for the sewage system sanation needs to be made. For the WWTP it is needed to: 11. Describe the - solve property of one part of the land current project status - design Main Design - obtain a Building Permit “KOMUNALAC” d.o.o. 13. Name of the “KOMUNALAC” d.o.o. 12. Final beneficiary Samobor operator Samobor
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary)
15. Additional On a DABLAS priority list Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
Priority axes 2 – Protecting Croatia Water Project No: 14 resources through improved water supply and Measure No: 2.2. integrated waste water system Project location: DUGO SELO
1. Project name Wastewater Treatment Plant of town Dugo Selo 2. Investment value 14.800.000 EUR (estimated) Construction of central wastewater treatment plant for 50.000 PE, with mechanical and 3. Description of main biological treatment technology and solution for the sludge disposal for the municipal project components wastewaters. and/or activities Extension of the sewerage network and construction of new mains. 4. Description of main Protection of Nature park Lonjsko polje. project objectives Improvement water quality and protection of Črnec stream. and expected results 5. Month and year of 6. Month and year of start of project 2009 end of project 2012 7. Project duration (years) 3 implementation implementation 8. Readiness of basic project documentation
Document type status status description completion date comment
Pre-feasibility study Feasibility study (with cost-benefit analyses which include economic and financial analysis) EIA study in progress 2007. Tender documentation
138 Other (specify):
9. Status of project design documentation and permits Design type status status description completion date comment Project part 1: Conceptual design finished Preliminary design in progress 2007. Main design Final design Location Permit Building Permit Other (specify): 10. Description of the land ownership status: Not solved. For the main parts of sewerage system it is needed to: • obtain Location and Construction Permit • design Main Design 11. Describe the For WWTP it is needed to: current project status • solve property of land • design Main Design • obtain Location and Construction Permit 13. Name of the “DUKOM” d.o.o. DUGO 12. Final beneficiary “DUKOM” d.o.o. DUGO SELO operator SELO
14. Sources of financing National component (including final IFI (specify) Other donor (specify) Proposed IPA grant beneficiary)
15. Additional Comment: -Technical Assistance -Strategic documents (plans, programmes, etc)
139 ANNEX IV: DETAILS ON PARTNERSHIP CONSULTATION
MINUTES OF MEETING HELD ON 21 MARCH 2007 CONSULTATIONS WITH PARTNERS PRESENTATION OF OPERATIONAL PROGRAMME FOR THE EU PRE-ACCESSION FUND IPA
Based on the activities initiated within the previous EU pre-accession programmes, CARDS, DABLAS and ISPA, and the preparation of the Operational Programme for the IPA pre-accession fund, the Partners in the implementation of these programmes have been recognized, i.e. potential fund beneficiaries: Croatian County Association, Union of Town Association and Municipality Association of the Republic of Croatia; economic associations: Croatian Chamber of Commerce, Croatian Water and Wastewater Group, civil societies (non-governmental institutions) Zelena akcija, Sunce, Zeleni Osijek, and the implementation body of the IPA projects for the water sector within the Operational Programme for the Environment of the Republic of Croatia.
The Ministry of Agriculture, Forestry and Water Management organized a presentation of the Operational Programme on 21 March 2007 at 10 a.m. at the head offices of Croatian Water, Ulica grada Vukovara 220, Zagreb. Present at the Meeting were: Representative of Zelena akcija, Irma Popović Representatives of the MAFWM Representative of the Sava Cards Representative of the Croatian Chamber of Commerce Representative of Croatian County Associations Signed Participant List is attached to these Minutes of Meeting
Absent at the meeting were the representatives of the Croatian Water and Wastewater Group, who apologized for the absence of their representatives in writing, and requested that the presentation of the Operational Programme for Environment related to water be separately held for all members of the Croatian Water and Wastewater Group.
Following the introductory words by Ms. Karmen Cerar on behalf of the MAFWM, who introduced the topic of the Meeting, i.e. the presentation of the Operational Programme for Environment within the Eu pre-accession fund IPA, in particular its segment related to the water sector, and announced that the presentation would be organized in two parts.
The first part of the presentation was held by Mr. Damir Tomasović, a representative of the CODEF, Central Office for Development Strategy and Coordination of the EU Funds, and also member of the MRS, Inter-ministerial Working Group, which prepared the Operational Programme.
In this part of the presentation, the participants were acquainted with the EU pre-accession assistance funds, and the future support programmes intended for the EU member states, i.e. structural and cohesion funds. This was followed by the explanation of the structure of the IPA programme, consisting of five components, and it was explained that this Operational Programme was carried out within the IPA Component III. Also presented was the scheme of the IPA Programming Framework, which is conducted at several levels, starting from the Enlargement package, which is comprised of the annual EC Report on the progress of an individual candidate country in the EU pre-accession process. The second level is the Multi-annual Indicative Programming Document, MIPD, also prepared by the EC, but in collaboration with the beneficiary country. It identifies the priority investment fields for each component of the IPA programme as well as the indicative financial allocations for the main intervention areas. The implementation documents for the IPA programme are the so called Operational Programmes, or OP’s. These documents identify specific activities for which the IPA funds can be obtained. The OP’s are developed by beneficiary countries, i.e. relevant sectoral body, in collaboration with other relevant bodies and partners. An OP is subject to adoption by the EC, which must approve it after it has established its harmonisation with the MIPD, MIFF, relevant national strategies and relevant EU aquis. The IPA funds are allocated to the beneficiary country on the basis of the OP, thus the OP’s are legally binding and attached to the Financial Agreement. The preparation sequence of the stated documents was also elaborated.
The second part of the presentation was held by Ms. Karmen Cerar on behalf of the MAFWM as a member of the IWG, Inter-ministerial Working Group, who presented the Operational Programme for Environment, and emphasized that two 140 ministries participated in the preparation of this document, the Ministry of Environmental Protection, Physical Planning and Construction (MEPPPC) and the Ministry of Agriculture, Forestry and Water Management (MAFWM). The MEPPPC prepared the part of the Programme for the solid waste sector, while the MAFWM developed the part of the Programme for the water sector. With coordination and consultations with the SDURFOM and other members of the Inter-ministerial Working Group, they prepared the First Draft of the Document, which was further elaborated on the basis of the review and comments of the EC representative, and has just been prepared as the Second Draft for repeated reading by the EC. This Second Draft of the Operational Programme was being presented.
This was followed by the elaboration of the legal basis for the preparation of the document, with considerations of the national policy and socio-economical context as well as the determination of the Community's strategic framework. The assessment analysis of mid-term needs, goals and strategic priorities was elaborated, and also the priority axes and measures for their implementation within this programme. Additionally, the criteria for project selections were explained, based on which the indicative list of projects with investment estimates was prepared. Also presented was the form of identification card for each individual project. The Financial Plan for fund withdrawal per year was presented to the participants as well.
Following the presentations, the participants expressed their satisfaction with the received information, and posed the following questions: 1. The representative of Zelena akcija asked: "Why watercourse protection and restoration projects have not been not included in this programme?" It was answered that this type of projects can be financed through other EU pre-accession funds, e.g. CARDS, etc.
2. The representative of the Croatian Chamber of Commerce remarked on the impossibility of preparation for this Meeting due to the fact that prior to it he was not given the insight into the document, and asked that it be subsequently submitted.
It was answered that this presentation covered only the part of the IPA Operational Programme for envirnmental protection related to the water sector, and that the MAFWM is ready to submit the document for insight to all identified implementation partners. However, since the Operational Programme is prepared for the whole environmental protection, in cooperation with the MEPPPC, for which the MEPPPC prepared the segment related to the waste sector, a prior approval must be obtained from the MEPPPC and the competent person for management and implementation of the III. Component of the IPA Regional Development – Environmental Protection in order to give insight into this document. The MAFWM shall undertake activities to enable insight into the presented document to the implementation partners of the IPA Operational Programme for environmental protection.
The Meeting ended on 21 March 2007 at 12 a.m.
141 MINUTES OF THE MEETING HELD ON 31 MAY 2007 CONSULTATIONS WITH PARTNER – THE CROATIAN WATER AND WASTEWATER ASSOCIATION PRESENTATION OF THE EU IPA OPERATIONAL PROGRAMME
As part of the activities on the preparation of a programme for the EU Instrument for Pre-Accession Assistance (IPA), the Ministry of Agriculture, Forestry and Water Management (MAFWM), the Directorate for Water Policy and International Projects organized on 21 March 2007 a presentation of the IPA Environmental Operational Programme for its identified partners in the implementation of EU pre-accession assistance programmes. The identified partners in the programme’s implementation are potential users of funds, i.e. the Croatian County Association, the Alliance of the Association of Towns and Association of Municipalities of the Republic of Croatia, economic associations: the Croatian Chamber of Economy, the Croatian Water and Wastewater Association, non-governmental organizations: the Green Action (Zelena akcija), Sunce, Zeleni Osijek (the Green Osijek ecologic society), and Hrvatske vode, implementing body of IPA projects in the water sector within the Environmental Operational Programme.
The presentation of the IPA Operational Programme held on 21 March 2007 on the premises of Hrvatske vode, Zagreb was not attended by the representatives of the Croatian Water and Wastewater Association, who had asked that the presentation of the Environmental Operational Programme covering the water sector be held separately for all of their members. It is for that reason that the presentation of the IPA Environmental Operational Programme was held on 31 May 2007, beginning at 11 a.m., on the premises of Hrvatske vode, Ulica grada Vukovara 220, Zagreb. It was attended by around 40 representatives of utility companies from all of Croatia. The signed list of participants is an integral part of these Minutes.
Mr. Ljubo Novoselić, president of the Croatian Water and Wastewater Association, gave keynote address on behalf of the Association. The participants were then greeted by Ms. Ružica Drmić, assistant minister, and Mr. Siniša Širac, deputy general manager of Hrvatske vode.
Following the welcoming address of Ms. Karmen Cerar on behalf of the MAFMW, she announced the topic of the meeting as a presentation of the IPA Environmental Operational Programme in the section dealing with the water sector, stressing that the MAFWM had on 10 May 2007 delivered the second draft of that document to the participants at today’s meeting.
The first part of the presentation was given by Ms. Karmen Cerar, MAFWM, as a member of the Interministerial Working Group (IWG), i.e. of the IWG which had prepared the draft Operational Programme.
In this part of the presentation the participants were acquainted with the existing EU pre-accession assistance programmes, and with future assistance programmes designed for EU Member States, i.e. Structural Fund and Cohesion Funds. Then the structure of the IPA programme was explained (consisting of 5 components), and it was stressed that this Operational Programme was implemented through IPA Component III. A scheme of the IPA programming framework, which is implemented at several levels, was presented. The documents in preparation were mentioned, as well as the order of their preparation. Emphasis was then put on the IPA implementation document, “Operational Programme” (OP). The participants were informed that this document identifies concrete activities for which EU funds can be provided. It was said that the document is prepared by the beneficiary country, i.e. the relevant line body in cooperation with other relevant bodies and partners. The prepared draft OP is submitted to the European Commission (EC) for adoption, and the EC has to approve it once it is convinced of its harmonization with other basic documents, i.e. Multi-annual Indicative Planning Document (MIPD), Multi-annual Financing Framework (MIFF), the relevant national strategies, and the relevant EU acquis communautaire. The participants were also informed that IPA funds are granted to the beneficiary country on the basis of the OP, which makes OPs legally binding and they are annexed to the Financing Agreement.
Ms. Cerar then presented the Environmental Operational Programme, i.e. its part dealing with the water sector, stressing that two ministries were involved in its preparation, the Ministry of Environmental Protection, Physical Planning and Construction (MEPPPC) and the Ministry of Agriculture, Forestry and Water Management (MAFWM). The MEPPPC had prepared the part of the programme dealing with the waste sector, and the MAFWM prepared the part dealing with the water sector. The First Draft of the OP was prepared in coordination and agreement with the Central Office for Development and Coordination of EU funds (CODEF) and other members of the Interministerial Working 142 Group. This first draft was modified following the review and comments of the representatives of the EC, and was submitted again to the EC for review as the Second Draft.
The legal framework of the document’s preparation was presented, which included national policy and socio-economic circumstances, and the strategic framework of the community was identified. Analysis of the assessment of middle-term needs, goals and strategic priorities was explained, and priority axes and measures for their implementation through this programme were presented. Explanation was given on the project selection criteria, on the basis of which an indicative list of project with estimated investment was made, and a form of identity card of each project was presented.
The participants were also presented with financial plans for withdrawal of funds per years. It was stressed that yearly allocation of IPA funds was as follows: the total IPA allocation for environmental protection amounts to €53.5 million (€17.0 million in 2007, €18.0 million in 2008, and €18.5 million in 2009), out of which the total amount allocated to the water sector is €26.45 million (€8.4 million in 2007, €8.9 million in 2008, and €9.15 million in 2009). The planned average co-financing rate is 75% from the IPA; however, it was stressed that the co-financing rate for individual project will be known once the applications for nominated projects are prepared, i.e. on the basis of the conducted cost-benefit analysis and based identified financial gap.
Following the presentation of the OP, Mr. Robert Kartelo, the representative of Hrvatske vode, took over. The MAFWM and Hrvatske vode are undergoing accreditation procedure of nomination for the IPA implementation body of Component III, Environmental Protection, Water Management.
Mr. Kartelo referred to the project selection criteria on the basis of which the indicative project list with estimated investment was made. These criteria are as follows: A) Administrative criteria – i.e. technical preconditions that have to be met in order for a project proposal to be considered valid: - Project application completed and all supporting documents attached (Feasibility study, Cost-benefit analysis, Environmental impact assessment in accordance with EU requirements and necessary environmental permits, design studies, etc.); - Ensured co-financing; - Project application submitted prior to the established deadline; B) Mandatory criteria – i.e. the preconditions to be met by project proposal: - Project proportion: projects / groups of projects / project stages should have a minimum value estimated at EUR 10 million; - A project has to be financially viable, i.e. future operation and maintenance costs have to be covered; - Viability: a project has to meet EU standards, comply with EU sectoral policies, and with the goals and principles of EU environmental policy and EU environmental regulations, with special attention given to the directives requiring large investments in order to provide support to harmonization with the acquis; - Harmonization with the priorities identified in strategic EU documents and national strategic documents; - Explanation that a project would not make progress without the help of the EU. C) Qualitative criteria – i.e. general conditions/modes on the basis of which the projects meeting the mandatory criteria will be assessed: - “Maturity” of projects, including environmental and other consent/permits (location permit, building permit, etc.) - Continuity of help from the Community, international financing institutions (IFIs) and other help, and previously identified investment priorities: investments and technical assistance are a continuation of the previous assistance program (CARDS, DABLAS, PHARE, ISPA, IFI, etc.); - Projects from previously prepared and agreed lists of national priorities; - Projects which will have the strongest impact and immediate benefit upon completion (projects covering the largest number of people, an agglomeration or an area); - Possible transboundary / regional impact(s); - The level in which it contributes to achieving economic and social cohesion of Croatia with the EU (projects with maximum potential economic and social advantages); - Relationship between environmental and economic efficiency of projects, i.e. between the people under the impact of the project and project costs; - Institutional and legal framework for project management / implementation (mostly in relation to the level of responsibility taken over from the final beneficiary (one or more)).
143 Then Mr. Kartelo presented the activities necessary in program implementation with implementation deadlines in the form of a Gantt chart. This includes activities from the preparation and final approval of the Operational Programme by the EC, accreditation of participants in IPA implementation, preparation, modification, and final acceptance of individual project applications by the EC, tendering procedure, and implementation on the field. With the help of the presented Gantt chart it was stressed that implementation deadlines for each of the above activity were very short, and that the coming tasks had to be addressed very seriously and promptly, particularly having in mind the fact that the deadline for the preparation of applications was June 2007.
Activities which had to be carried out until the preparation of application for each of the projects were roughly presented: 1. Nominate projects whose investment value exceeds EUR 10 million; 2. Define the sources of funds other than IPA, regardless of the % of the grant; 3. Make a cost-benefit analysis and calculate the financial gap; 4. Precisely define investment value, i.e. scope of the project; 5. Prepare an Environmental Impact Assessment, i.e. at least its Summary in the form required by the EC; 6. Have property relations settled, i.e. possess a strictly defined program for resolving property relations, with December 2007 as the deadline; 7. Check the affordability of the prices of services; 8. Survey the population on the acceptable increase in price; 9. Prepare the Application with all the required annexes, documents and calculations in English; 10. Define the project realization dynamics, having in mind the n+3 rule and the annual IPA allocation, and the number of nominated projects.
Once the presentations were completed, the participants were informed that the EC had sent its comments on the second draft on 11 May 2007, and that the IPA Operational Programme was submitted to an independent consultant – the European Policies Research Centre, University of Strathclyde, which conducted the so called ex-ante appraisal of the document in April 2007. The comments of the EC and the Consultant on the second draft of the Operational Programme will be incorporated into the third draft, whose planned date of completion is 8 June 2007.
Since the second draft of the IPA OP had already been submitted for review and comments to all of the identified partners in implementation, including the Croatian Water and Wastewater Association, those present were invited to ask questions and give their comments, which would be taken into consideration when preparing the final, third draft of the OP.
The participants were satisfied with provided information, and their questions and comments follow below: The director of “Vodovod i kanalizacija“ Rijeka water and sewerage company, Mr. Željko Mažar, had the following questions: 1. Why does this programme apply the following project selection criteria: water losses from a water supply network over 40%, level of completion of sewerage systems less than 75%? The majority of towns and municipalities have similar problems, so it is not possible to identify priorities on the basis of such criterion. Answer: The preparation of the EPOP itself, and its goals and implementation measures were the result of the draft Water Management Strategy, which defines the existing status of water management, provides comprehensive approach to water system improvement, defines the strategic goals, and establishes and harmonizes water management policies with international obligations. That is why the presented data represent only the basic approach to upgrading and improvement of water supply and sewerage networks and wastewater treatment plants. The project selection criteria are listed in Chapter 3.1.2, which clearly states technical preconditions which have to be met in order for a project proposal to be considered valid, as well as the criteria on the basis of which the projects which meet the preconditions will be assessed (part of Mr. Kartelo’s presentation).
2. How come it is only the projects in the Danube and Sava river basins that are proposed for this programme, and there are no projects in the Adriatic basin? Answer: The problems with water quality standards are the greatest in the Black Sea / Danube River basin. Having also in mind the fact that water management priorities in the Adriatic basin are already included in the Coastal Cities Pollution Control Project financed by the World Bank, whose aim it is to improve the quality of recipient water and provide better municipal services in the settlements in the Adriatic basin, the majority of the proposed projects were prepared with the aim of improving wastewater sewerage and treatment in the Black Sea / Danube River basin. The
144 indicative list of projects in this IPA OP includes one project on the mainland area of the Adriatic basin – the Knin and Drniš Project, which is not included in the World Bank-financed program.
3. Why wasn’t the town of Rijeka included in the list of identified projects? Answer: The project of the town of Rijeka was not included in the list of identified projects because EU assistance programs through IPA funds support regional development, i.e. support the development of infrastructure, which will provide positive atmosphere for the development of economy on those areas where it is necessary. Likewise, the EC co-finances the projects which could not have been financed on their own. Due to limited funds, Croatia had to define certain priorities established in the Operational Programme, which resulted in the indicative project list presented in the OP.
Mr. Mažar accepted the given answers and said he had no further questions or comments. On behalf of the Croatian Water and Wastewater Association Mr. Novoselić thanked for the presented document and said that the Association, having previously studied the document, had no further comments or remarks. The meeting was concluded on 31 May 2007 at 1:30 p.m.
145 ANNEX V: DIAGRAM OF THE EPOP INSTITUTIONAL STRUCTURE
146
Republic of Croatia
OPERATIONAL PROGRAMME FOR HUMAN RESOURCES DEVELOPMENT 2007 – 2009
Instrument for Pre-Accession Assistance
2007HR05IPO001
September 2007 Table of Contents
1. Context...... 7 1.1 The national socio-economic and policy context ...... 7 1.1.1 Croatia's accession to the European Union...... 7 1.1.2 The national socioeconomic context ...... 7 1.1.3 The national policy context...... 10 1.1.4 Strategic Development Framework (SDF) 2006-2013...... 17 1.2 The EU policy context...... 18 1.2.1 Cohesion policy...... 18 1.2.2 Pre-accession assistance...... 19 1.2.3 Joint Inclusion Memorandum (JIM) ...... 21 1.2.4 Joint Assessment of Employment Priorities (JAP)...... 22 1.3 Process of elaborating the Operational Programme ...... 23 1.3.1 Co-ordination and consultation...... 23 1.3.2 Ex ante evaluation...... 24 2. Assessment of medium term needs and objectives ...... 27 2.1 Socio-economic analysis ...... 27 2.1.1 Demography and public health...... 27 2.1.2 Employment and unemployment...... 28 2.1.3 Education, training and skills development ...... 31 2.1.4 Social protection, income and social inclusion ...... 32 2.1.5 Regional disparities ...... 34 2.2 SWOT analysis ...... 37 2.3 Strategic priorities ...... 39 2.3.1 Introduction...... 39 2.3.2 Employment ...... 39 2.3.3 Education, training and skills development ...... 40 2.3.4 Social inclusion...... 40 2.3.5 Administrative capacity...... 41 3. Programme strategy ...... 42 3.1 Concentration of assistance - priority axes and measures...... 42 3.2 Indicators...... 65 3.3 Horizontal issues ...... 82 3.3.1 Gender equality and prevention of discrimination...... 82 3.3.2 Sustainable development and environment protection...... 83 3.4 Complementarities with other forms of assistance...... 84 3.4.1 Previous and planned EU assistance...... 84 3.4.2 Principles governing complementarity with IPA Component I ...... 87 3.4.3 Complementarity with the Regional Competitiveness OP ...... 88 3.4.4 Other OPs and IPA components ...... 90 3.4.5 IFIs and other international donors...... 90
2 3.5 Indicative list of major projects ...... 91 4 Financial tables ...... 92 4.1 Calculation of Community contribution...... 92 4.1.1 MIPD indicative financial weightings (major areas of intervention)...... 92 4.1.2 Application of Article 153 of IPA Implementing Regulation...... 92 4.1.3 Programme duration...... 92 4.2 Financial tables...... 93 5 Implementation provisions ...... 97 5.1 Management and control structures ...... 97 5.1.1 Bodies and authorities...... 97 5.1.2 Separation of functions...... 105 5.2 Monitoring and evaluation ...... 105 5.2.1 Monitoring arrangements...... 105 5.2.2 Management Information System...... 107 5.2.3 Monitoring System and Indicators ...... 107 5.2.4 Selection of operations...... 108 5.2.5 Sectoral annual and final reports on implementation...... 109 5.2.6 Evaluation arrangements...... 109 5.3 Information and publicity...... 110 5.3.1 Introduction...... 110 5.3.2 Requirements...... 110 5.3.3 Activities ...... 111 5.3.4 Indicative budget ...... 111 5.3.5 Management and implementation ...... 111 5.3.6 Monitoring, evaluation and reporting ...... 112 5.3.7 Partnership and networking...... 112 5.3.8 Internet ...... 113 Annex 1: Membership of Inter-Ministerial Working Group...... 114 Annex 2: Attendance at the partner consultation under the OP for IPA Component IV...... 115 Annex 3: Analytical tables and data...... 116 Annex 4: Detailed Summary Table for the Operational Programme ...... 129 Annex 5: Human Resources Development Operational Programme - Organigram...... 137 Annex 6: Ex-ante Evaluation Report ...... 138
3 GLOSSARY OF ABBREVIATIONS AA Audit Authority AAE Agency for Adult Education AE Adult Education ALMP Active Labour Market Policies AP Accession Partnership APIU Trade and Investment Promotion Agency ASHE Agency for Science and Higher Education AVET Agency for Vocational Education and Training CAO Competent Accrediting Officer CBC Cross-Border Cooperation CBS Central Bureau of Statistics CES Croatian Employment Service CHII Croatian Health Insurance Institute CNB Croatian National Bank CNES Croatian National Educational Standard CODEF Central Office for Development Strategy and Coordination of EU Funds CPII Croatian Pension Insurance Institute CSG Community Strategic Guidelines ECD European Commission Delegation EES European Employment Strategy EIA Environment Protection Act EP European Partnership ESDP Education Sector Development Project ESF European Social Fund ESSPROS European System of Integrated Social Protection Statistics ETF European Training Foundation ETTA Education and Teacher Training Agency EU European Union EU-SILC EU Survey on Income and Living Conditions FWA Framework Agreement GDP General Domestic Product HBS Household Budget Survey HRD Human Resource Development HRDOP Human Resource Development Operational Programme IB Implementing Body
4 ILO International Labour Organisation IPA Instrument for Pre-Accession Assistance IWG Inter-ministerial Working Group JAP Joint Assessment of Employment Priorities JIM Joint Inclusion Memorandum LFS Labour Force Survey LLL Lifelong Learning LPE Local Partnership for Employment MC Monitoring Committee MELE Ministry of Economy, Labour and Entrepreneurship MEPPPC Ministry of Environmental Protection, Physical Planning and Construction MF Ministry of Finance MFAEI Ministry of Foreign Affairs and European Integration MHSW Ministry of Health and Social Welfare MIFF Multi-annual Indicative Financial Framework MIPD Multi-annual Indicative Planning Document MSES Ministry of Science, Education and Sport MSI Mentors for Social Integration MSTTD Ministry of See, Tourism, Transport and Development NAO National Authority Officer NAPE National Action Plan for Employment NEPP National Equality Promotional Policy NF National Fund NFCSD National Foundation for Civil Society Development NFLS National Labour Force Survey NIPAC National IPA Coordinator CROQF Croatian Qualifications Framework OP Operational Programme OS Operating Structure PA Priority Axis PEP Pre-Accession Economic Programme RCOP Regional Competitiveness Operational Programme RLMC Regional Labour Market Councils SAA Stabilisation and Association Agreement SCF Strategic Coherence Framework SDF Strategic Development Framework
5 SF Structural Funds VET Vocational Education and Training VETIS Vocational Education and Training Information System
6 1. CONTEXT
1.1 The national socio-economic and policy context
1.1.1 Croatia's accession to the European Union Relations between Croatia and the European Union are governed by the Stabilisation and Association Agreement (SAA) signed in October 2001 and in force since February 2005. The SAA provides a legal framework for political dialogue, regional cooperation, economic relations and the use of the Community financial assistance. In April 2004, the Council of the European Union adopted the European Partnership with Croatia. After the Commission’s positive opinion on Croatia’s application for membership in April 2004 and the European Council’s decision in favour of Croatia’s candidacy in June 2004, accession negotiations were formally opened on 3 October 2005. In February 2006, the European Partnership was updated to an Accession Partnership that reflected Croatia’s new status as a candidate for EU membership. Most of the priorities identified in the Accession Partnership pertain to institution building in support of the adoption of the acquis communautaire by Croatia but in those areas related to economic and social cohesion, financial assistance has increasingly been allocated to “pre-Structural Funds” activities that are intended to support capacity-building through “learning by doing”. In relation to human resources development, the Accession Partnership identified as short-term priorities the continued alignment of relevant legislation with the acquis and strengthening related administrative, enforcement and co-ordination arrangements. As medium-term priorities, the Accession Partnership identified continued work on these two areas in addition to: • Supporting capacity-building of the social partners. • Developing and implementing a comprehensive employment strategy. • Developing and implementing a national strategy for social inclusion. • Increased efforts to create a modern vocational education and training system. On the same themes, the EC’s Croatia 2006 Progress Report noted in relation to employment and social policy that, “Attention should be paid to undertaking active labour market measures, as well as to adult education and training..... Specific gaps remain to be addressed particularly in relation to administrative capacity, which remains weak.” The report also noted that: the Croatian unemployment rate remains high (despite falling in recent years); regional inequalities are considerable and qualification and skills levels of the Croatian labour force are lower than in the EU. It suggests that further efforts would be advisable in relation to both active labour market measures and adult education and training.
1.1.2 The national socioeconomic context
Recent macro-economic developments1 Croatia is generally considered to be a functioning market economy which should be able to cope with competitive pressures and market forces within the European Union in the short to medium term. Its macroeconomic position is characterised by stable growth, improving fiscal condition, low inflation, a stable exchange rate and a declining unemployment rate. However, current key macroeconomic challenges include external vulnerability (due to large deficit of the current account and high level of foreign debt) and structural reforms which should be further reinforced.
1 Statistical data used in the document are those available in August 2007 Following the implementation of the stabilization programme in October 1993, aimed primarily at stopping hyperinflationary trends, the Croatian economy has recorded a stable growth path accompanied by a low inflation. The average growth rate in the period 1995-2006 amounted to 4.4%. After a 4.3% growth rate has been achieved in 2005, real GDP growth reached 4.8% in 2006. Expressed in current prices, GDP per capita reached 7,037 EUR in 2005 and 7,704 EUR in 2006. According to Eurostat first releases, in 2006, GDP p.c. measured by the PPP was close to 50% of the EU-27 average2 while preliminary estimates with the grey economy included, point towards a level of income close to 60% of the EU 27 average. Since 2004, the Government has reduced the fiscal deficit, improved transparency and the budgeting processes. Fiscal performance is reflected in the net reduction of the fiscal deficit from 4.8% of GDP in 2004 to 4.0% of GDP in 2005. In 2006, fiscal deficit fell further to 3% of GDP. Such a performance is mainly based on strong revenue growth resulting from vigorous economic performance and increased efficiency of the Tax Administration in the collection of taxes as well as the moderation in spending. According to the Economic and Fiscal Policy Guidelines 2008-2010, in 2007 Croatian Government aims to further decrease its fiscal deficit to 2.6% of GDP. Croatia has had low inflation rates since 1994. Since then, average annual consumer price inflation amounted to 3.4%. In 2006, the average inflation rate amounted to 3.2%. Inflation was kept stable and relatively low due to appreciation of the HRK/EUR exchange rate, slow nominal wage increase, mild labour productivity growth, and intense competition in the retail trade. Low inflation is underpinned by the monetary policy determined by the Croatian National Bank. It is being supported by the stable exchange rate through the “managed float regime”. In the period 2001-2006, fluctuations of average monthly HRK/EUR exchange rate remained within a +/-4 % band. In the context of high 'euroisation' within Croatian financial system, the Croatian Central Bank is continuing to tightly manage the EUR/HRK exchange rate as it is the key instrument for curbing inflationary expectations in the country, and also influences the stability of the import prices from euro-zone. A persistent investment-savings gap has led to high current account deficits and a build-up of foreign debt. In the period 2000-2006, average current account deficit was 5.8 percent. At the end of 2006 current account deficit amounted to 7.8 percent of GDP. As a consequence, gross foreign debt grew. During last three years the growth in foreign debt has been slowed down; however, the level of foreign indebtedness reached at the end of December 2006, 29.2 billion EUR, accounted for 85.3% of GDP. Accordingly, the reduction of the external vulnerability remains a key macroeconomic challenge. Public debt is below the Maastricht criterion of 60%. General government debt amounted to 40.8% of nominal GDP at the end of 2006; while public sector debt (total general government debt including issued government guarantees) totalled 46.4% of GDP in nominal terms at the end of 2006. The structural composition of the economy has been shifting from agriculture towards trade and services. Over the period 2000 to 2006, the share of real value added in primary sector decreased from 9.1 to 7.4% of GDP, the share of value added in secondary sector slightly decreased from 25.5 to 24.5%, while the share of value added in tertiary sector increased from 65.4 to 68.1%.
Demography Croatia is facing a changing and particularly challenging demographic profile. Projections indicate that the country is aging at one of the fastest rates in Europe. The Central Bureau of Statistics forecasts a reduction of the Croatian population by 700 thousand (-16%) by 2050. The share of older people (over 64 years) in the total population could increase from 17% in 2005 to 27% in 2050, while the share of youth (15-24 years) may drop from 13 to 10%. The population of working age (15-64 years) could well fall by 780 thousand.
2 However, Croatian and EU statistics are not fully comparable since Croatia does not adjust GDP figures for the effects of grey economy
8 Accordingly, if the costs of increased social security transfers and health care spending associated with an ageing population are to be met, a significant increase in the employment rate will be required.
Employment and unemployment Croatia’s unemployment rate (according to ILO methodology) has been constantly increasing since 1996 till 2000 when it reached its peak of 16.1%. Since then, it has been decreasing and reached 11.2% in 2006. The rate remains relatively high amongst the young between 15-24 (28.9% in 2006) and women (12.7% in 2006). Fluctuations of the unemployment rate of younger population have been very large – from 31.2 percent in 1998 to 40.1 percent in 2001 to 28.9 percent in 2006. The unemployment rate of women reached its peak of 17.9 per cent in 2001, but has been decreasing since then to 12.7 per cent in 2006 (Source: LFS data; Central Bureau of Statistics, Zagreb). There is also a high rate of long-term unemployment. According to Eurostat, in 2006 the share of the long- term (a year or more) unemployed in the total labour force amounted to 6.7 percent in Croatia compared to 3.6 percent in the EU 27. The share of the long-term unemployed in the total number of the unemployed was 58.9 percent in Croatia and 45.3 percent in the EU. The difference was larger for women than for men. In terms of employment possibilities, there are significant regional variations within the country. This is starkly evident if one compares the county of Istria with the lowest registered unemployment rate, 8.4%, with the county where unemployment is highest, Vukovar-Srijem, 31.3.% (end March 2006), source: Central Bureau of Statistics, Croatian Employment Service. The most recent data show that average employment has increased in 2006 compared to 2005 by 0.8% according to the Labour Force Survey methodology (and by 3.3% according to the administrative data sources methodology). The strongest positive impulse came from small business – crafts and free professions. The largest employment growth was recorded in real estate, renting and business activities, financial services, wholesale and retail trade and construction. 2006 saw an increase in both nominal and real wage growth and this trend can be expected to continue next year. Positive developments in the labour market are expected to continue, supported by solid short-term economic growth. Total registered employment is projected to rise by around 1% per year. The number of unemployed is expected to shrink further helping to push unemployment rate below 10% in 2007.
Poverty and inequality Poverty and inequality have increased in Europe as a whole over the past few decades and this increase has been particularly marked during the past decade in the transition countries. According to Eurostat, the “at risk of poverty” rate in Croatia was 18% in 2005, while the EU average was 25%. Poverty in Croatia is particularly prevalent among the elderly, people with lower education and the unemployed and is usually long-term in nature.
Education Educational provision in Croatia has improved compared to the situation in 1991 but further efforts are needed to catch up with EU standards. According to the 2001 census, 18.6% of the population aged over 15 have attended no school or have not completed primary school education. When one adds those who have only finished primary school, one reaches 40.4% of the population. The share of highly educated people (having received education beyond the secondary school level) is below 12%. The current provision of VET needs to improve to fully meet the demands of the labour market; at the end of 2005, 38% of all unemployed people had graduated from 3-year vocational schools. Croatia is recognized to be lagging behind the EU average in relation to the provision of adult education and training and in relation to the participation of adults in education and training in general. The participation of the population aged 25-64 in formal education or training in 2005 was 9.7 % in the EU, and 2.1 % in Croatia.
9 Structural reforms Various positive structural reforms have been implemented in Croatia. In order to improve business climate, the Croatian authorities embarked on a series of measures in the course of 2006: e.g. a project focusing on streamlining and simplifying legal framework connected with doing business in Croatia as well as an incentive to decrease the tax burden on legal entities through the reduction of “hidden fees”. Furthermore, a reform of health-care financing is under way, as well as a reform of social welfare focused on consolidation of various social benefits and the simplification and better targeting of the whole system. The number of purely private firms is expected to increase further due to the process of selling the remaining equity stakes in the Government portfolio. At the same time, the restructuring of state-owned companies, as a part of the preparation for their privatisation, has been under way in the railway sector. Privatisation process has been successfully completed in the ferrous metallurgy sector, and is expected to start in the shipbuilding sector. Restructuring and privatisation efforts need to be continued especially in the areas of shipbuilding as well as in the remaining state-owned tourist companies. The aim is to increase the private sector’s share of GDP to 70% by the end of 2008 as compared to 60% in 2005. The Pre-Accession Economic Programme (PEP) in Croatia sets strengthening competition and state aid control as one of the key aims behind the structural reform in Croatia. The structure of the economy has been changing towards a greater role of services, particularly market services, and towards a greater number of private firms and institutions. That process is expected to continue, supported by fast registration procedure and entrepreneurship promotion. Key economic challenges for Croatia over the next three years will be: tackling external vulnerability, structural reforms and further fiscal consolidation. This is especially important in the framework of the high costs connected with EU accession, the precise level of which has yet to be defined as the negotiation process goes on and exact requirements become clearer.
1.1.3 The national policy context
General Economic Policy According to the Pre-accession Economic Programme 2007–2009 and Economic and Fiscal Policy Guidelines 2008-2010, adopted by the Government at the end of 2006 and mid 2007 respectively, the Government plans a set of policy measures aimed at reducing fiscal deficit, public debt and external debt as well as reinvigorating privatisation process. On the expenditure side, it will continue with the planned reform of the health insurance and social benefits and the planned reforms in the area of privatisation of large state- owned enterprises. In order to develop domestic yield curve and to reduce external vulnerability, the Government will continue primarily borrowing on the domestic market. On the income side, it plans to step up the reforms in the process of tax collection in order to improve its efficiency. The foreseen structural reforms should result in the reduction of the general government expenditures according to GFS 1986 methodology (from 47.8% of GDP in 2006 to 43.1 % of GDP in 2010) as well as the reduction of general government deficit from 3.0% of GDP in 2006 to 0.5% of GDP in 2010. Furthermore, the reduction of public debt (sum of the general government debt and the guarantees) is projected to fall from 46.4% of GDP in 2006 to 37.1% of GDP in 2010 (source: Economic and Fiscal Policy Guidelines 2008-2010). Monitoring of the International Monetary Fund will be limited to the Article IV consultations, which are to take place once a year, however, it is expected that the monitoring of the European Union will become more intense as the accession process goes on. The Government plans to establish policy credibility by moving forward with fiscal consolidation and necessary structural reforms, but of the outmost importance is creating a business-friendly environment that will turn investment interest into actual projects and create new jobs.
10 Employment The National Action Plan for Employment for 2005-2008 (NAPE) was adopted by the Government in December 2004. The NAPE was elaborated according to the guidelines of the European Employment Strategy and recommends measures to be taken by the Republic of Croatia under each of the guidelines, including both active and preventative measures. These measures are intended to promote employment and social inclusion and make it possible for unemployed and inactive persons to benefit from various forms of training which increase their competitiveness and facilitate their integration in the labour market. Other measures aim to increase the number of new and higher quality jobs through the promotion of entrepreneurship and a more favourable business environment. A programme of active labour market measures, mostly in the form of employment subsidies, was implemented by the CES from March 2002 to September 2005. The hiring of about 80 thousand persons was subsidized and nearly 900 million kunas was spent. In the years of full implementation (2003 and 2004), the subsidized hiring amounted to about 17 percent of total hiring from the register and the spending amounted to 0.17 percent of GDP. From initial indications, the programme is targeted at special groups including youth with no work experience, elderly persons, the disabled and war veterans. However, it also included a general “introduction-to-a-job” measure in which almost all unemployed persons could participate. In fact, two thirds of participants were hired within that general measure. In accordance with the Joint Memorandum on Social Inclusion (Chapter 4.1.1.1 - current problems and efforts), the measures could benefit from focusing more on the less employable groups. Furthermore, stronger emphasis should be put on improving qualifications, acquisition of knowledge and competence, employability and adaptability among the unemployed and the employed as well as eliminating “dead weight”. In March 2006, the Government introduced a new set of active labour market measures within the Annual Employment Promotion Plan, which is based on the NAPE. The measures implemented by the CES include employment subsidies for young persons without work experience, the long-term unemployed, older persons, and other special groups, including hard-to-place persons, the disabled, lone parents and parents with 4 and more children, women who return to the labour market after the third childbirth, war veterans and children and spouses of deceased soldiers, women victims of family violence or trafficking, minorities, asylum seekers, ex-addicts, and ex-convicts. The amount of subsidy is lower for larger employers and higher for hiring better-educated persons. The amount of a hiring subsidy ranges from 625 to 3,000 kunas a month, and its duration ranges from 12 to 18 months. Subsidized employment must show a net increase in total firm’s employment for 2 or 3 years. The measures also include subsidized training for the newly employed and the long-term unemployed, and retraining for the employed under the threat of unemployment and for those unemployed willing to work in seasonal jobs and occupations in short supply. A training subsidy can last up to 9 months and it can cover from 25 to 80 percent of training costs. Apart from subsidized training of the newly employed with known employers, there is also training of the unemployed for the general labour market. All the long-term unemployed and those unemployed willing to work in seasonal jobs or in construction and shipbuilding can apply for training. Finally, the CES subsidizes local governments’ public works for targeted groups. By the end of 2006, 4,869 persons have participated in the measures, most of them, 82 percent, in subsidized hiring. In comparison, the hiring of 14,500 persons was subsidized in 2005.
Croatian Employment Service (CES) In addition to measures under the Government Plan, the CES also implements training measures financed and organized itself or in cooperation with local governments. However, the number of participants is not substantial (for example nearly 650 persons in the first half of 2006). Furthermore, there is a set of measures implemented by the CES within the Decade for Roma Inclusion programme, including public works, training
11 for the general labour market and subsidized employment. By the end of 2006, 220 persons of the Roma minority have participated in those measures. In addition, special job-search and vocational counselling have been provided. Besides the CES, some other institutions also implement active labour market measures. For example, the Ministry of the Family, War Veterans and Intergenerational Solidarity subsidizes training, self-employment, loans and projects for unemployed war veterans and for children of deceased soldiers. Also, the Fund for Professional Rehabilitation and Employment of Disabled Persons subsidizes employment of the disabled in cooperation with the CES which provides mediation by specially trained counsellors. For its part, the Ministry of the Economy, Labour and Entrepreneurship subsidizes trade/craft registration, training, and interests on loans for self-employment and entrepreneurship. Finally, the Ministry of the Sea, Tourism, Transport and Development gives subsidies and loans for the establishment of small family hotels and pensions, etc. Based on the lessons learned from the previous set of active labour market measures implemented by the CES, the new set of measures is better targeted and puts more emphasis on training, while the number of participants is much lower. Such measures aim to renew and upgrade skills of the unemployed, to alleviate the problem of skill/occupation mismatch and to reduce the problem of dropouts with no vocational education. In addition, micro-econometric and, if possible, experimental evaluation of their effects, should be applied. Regarding measures for special groups, the effect of 'stigmatization' needs to be avoided. At the same time, it should be ensured that active labour market measures implemented by other institutions are consistent with, and complementary to, measures implemented by the CES. The CES is comprised of a central office, a network of 22 regional and 94 local offices. The Governing Council of CES consists of representatives from trade unions, employers and Government. The Croatian Employment Service had, in December 2006, 1,197 members of staff. It provides mediation and selection services to the unemployed and employers as well as career guidance to the unemployed, prospective students and trainees. It also provides unemployment compensation administration and implements active labour market policies. Finally, it provides statistical reports based on data from its registers, and analytical reports on various labour market issues. Staff roles in the CES are divided along the following functional lines: • Regional Directors • Counsellors – for job seekers; • Advisers – for employers; • Administrators. Individual counsellors are responsible for particular sectors of economic activity, all enterprises within such sectors and the occupations within it.
Tax and benefit systems The relative burden of labour income taxation in Croatia does not appear to be high in comparison with the EU average. Social security contributions make almost a third of total labour costs, but income tax on low wages is very low itself. According to Eurostat, the share of social security contributions and income taxes in the total labour cost for a low wage worker in the EU-25 in 2004 was 36.4%. The share of social security contributions in the total labour cost in Croatia is 31.7% and income tax paid by a low wage worker is not high because of a large personal deduction. Only the involuntarily unemployed, except in some cases, can receive unemployment compensation, its duration depends on the duration of previous employment, its maximum amount is limited to a relatively low level, and the number of recipients is relatively small. Unemployment benefits in Croatia are not deemed to be inordinately high. The maximum amount of monthly unemployment compensation is limited to 1,000 kunas, equivalent to 21.9% of the average net wage in 2006. However, there is a one-time supplement, amounting to two, four or six monthly payments, for the unemployed who had a long tenure with their previous employer. This was introduced as a compensation for the reduction of statutory severance pay within the Labour Law reform in 2003. Despite this the tax and
12 benefit system in Croatia does not appear, overall, to contribute to a significant “unemployment trap” by reducing the level of activity among the unemployed. The share of benefit claimants among the unemployed is less than a quarter.
Skills, Education and Training Through the Education Sector Development Plan (2005-2010), Croatia has taken a number of substantial steps to improve the quality and effectiveness of its educational system with the aim of establishing comprehensive national standards and achieving more coherence between the education sector and labour market needs. The Development Plan describes the current situation, identifies priorities (improving the quality and effectiveness of education, stimulating the continuing professional training of teachers, developing strategies for the education system) and specifies qualitative and quantitative performance targets for the education system. The Croatian National Educational Standard (CNES) was developed in 2004 and experimentally introduced in 5% of primary schools in the school year 2005/6. A decision on introducing an experimental educational plan and programme, based on the CNES, in the first to eighth grade of primary school was made in September 2005. In the school year 2006/07, all primary schools will implement CNES and a National Curriculum. Also at national level, the Programme of Measures for Implementing Compulsory Secondary Education was adopted on 21 June 2007. Croatia signed the Bologna Declaration in 2001 and, since 2003, has been involved in an intensive reform of its higher education system in line with its national needs and European standards. During 2003 and 2004, a new Act on Scientific Activity and Higher Education and an Act on the Recognition of Foreign Higher Education Qualifications were adopted that incorporate all the principles of the Bologna Declaration. In December 2004, five Rules of Procedures covering the field of higher education were adopted which regulate: the establishment of higher education institutions; the measures and criteria to be used for evaluating the quality and efficiency of institutions and study programmes; the content of student databases; the content of student documents; and the content of diplomas and diploma supplements. This period also saw the establishment of the Agency for Science and Higher Education and the National Council for Higher Education, two independent bodies that oversee the development and quality of the overall higher education system in Croatia. The first phase of the Bologna process was completed in 2005 with the implementation of the first two study cycles, undergraduate and graduate. An evaluation of over 800 study programmes that had to be adapted in their structure and content to the criteria of the new European Higher Education Area and the Bologna Declaration was carried out. The first phase of the Bologna process also included the establishment of a quality assurance system. The Agency for Science and Higher Education, through its Quality Assurance Department, will perform the evaluation of the quality assurance system and quality assurance units at higher education institutions Croatia has already started preparations for development of the Croatian Qualifications Framework (CROQF) which is planned to be compatible with the European Qualifications Framework. The Ministry of Science, Education and Sports has initiated bi-lateral consultations with other Ministries, professional organizations and stakeholders with the aim of forming a National CROQF Working Group that will coordinate all activities regarding the creation of the CROQF. In July 2007 the Government adopted the Baseline for the Croatian Qualification Framework (CROQF) and assigned its implementation to the Ministry of Science, Education and Sports. The defined Baseline sets guidelines for the harmonisation of legislation regulating elementary education, secondary education, higher education and science i.e. lifelong learning. The CROQF will consist of eight levels and for each one a set of measurable and comparable learning results will be defined on the basis of the scope of learning results, links to the levels in the draft of the European Qualification Framework (EQF), types of qualifications for each level, regulated ways of acquiring certain qualifications, possibilities of multi-directional viability and names of qualifications. Development of CROQF will enable: accessibility of education throughout lifetime,
13 better employability through development of a system for evaluation and recognition of competencies acquired at work (prior learning) or through other forms of learning (non-formal and informal learning), development of a clear overview of educational achievements for the employers, evaluation and recognition of qualifications from abroad in Croatian and vice versa as well as promoting education in Croatia. It is planned to establish the CROQF by the end of 2008. A Commission for Adult Education has been established and, in 2004, it drafted a Strategy for Adult Education. The main objectives of the strategy are to develop measures for implementing lifelong learning as a right and an obligation of all citizens, to develop a system of adult education that will offer equal opportunities and quality learning, to develop measures ensuring a partnership approach, to create legal and professional prerequisites for establishing adult education as an integral part of the education system and to address individual learning needs as well as those of labour market and wider society. In addition to the Strategy, an Action Plan for the Implementation of the Strategy of Adult Learning in 2005 was also adopted in 2004. Since 2004, a new Action Plan has been adopted by the Government for each year. Finally, an Agency for Adult Education was established in May 2006 and became operational in November 2006. The Agency currently has 33 persons permanently employed under its employment plan and has secured funding to have a total of 35 employees by the end of 2007. The Act on Adult Education was adopted in February 2007. Some years ago, Croatia introduced vocational training at post-secondary level in the form of 'polytechnics'3. The Croatian Agency for Vocational Education and Training (AVET) was established in late 2005. Together with its stakeholders, the Agency has already started work on: sectoral analyses (of the manufacturing, processing and service sectors) that will contribute to the development of the CROQF in VET; occupational standards and qualifications based on learning outcomes and competencies for secondary school graduates; and reform of the vocational education curricula in order to develop and implement flexible, open and modularised curricula. A labour market study was conducted following which the number of defined educational sectors was reduced from 33 to 14. Thirteen Sector Councils have been established and the list of VET occupations updated. Furthermore, the proposal for the content of a new VET law was produced, as well as a concept for a VET management information system. At present, AVET has approximately 30 employees and plans to employ 42 in total. Two CARDS VET projects are implemented through AVET. The Ministry of Science, Education and Sports has begun consultations with other ministries, professional organizations and stakeholders with the aim of forming a National Working Group which will coordinate activities regarding the creation of the CROQF. Moreover, with EU assistance, two relevant initiatives have been taken: pilot Sectoral Councils have been established to enable employers to advise on the curriculum of vocational schools; and pilot 'Local Partnerships for Employment have been established to enable employers, local governments, local offices of the Employment Service and other stakeholders to have an input into the school enrolment policy at the local level. Sector Councils are tripartite non-professional bodies established and financed by AVET. Their role is described in the ‘Proposal for the content of the VET Law’. Although the VET Law is not yet in procedure, the present function of the Sector Councils is, inter alia, to provide analysis and data regarding market labour needs and required competences (by sector and occupation, on regional and national level etc.) and to approve specified occupations and qualifications. Through this process, labour market demand is reflected in VET education in Croatia. AVET (together with the CARDS VET 2003 project team) developed the methodology and tools for this work and continues to provide education and training for Sector Councils members. Nevertheless, the capacity of
3 Dubrovnik polytechnic (since become a university) was founded in 1996. Since then, ten other polytechnics have been established: most recently (in 2006) in three areas of special state concern - Gospić, Šibenik and Slavonski Brod.
14 the present Sectors Councils is not enough to carry out all the analyses needed and much stronger engagement by private-sector representatives is needed. AVET also established 13 local experts’ occupational working groups to develop occupational standards for 13 VET occupations identified as priorities by Sector Councils. Members of these working groups are employers and employees from a particular sector. Further steps that will be taken in the next period are to establish local experts working groups for developing qualifications and, subsequently, to establish curricula writing working groups. AVET’s budget has increased threefold for 2007 but its capacities need to be further reinforced.
Social Cohesion and Inclusion During the 1990s, the social care services system in Croatia was centralized and very few NGOs were involved in social service provision. Following legislative changes in 2001, some social service decentralization took place (primarily of services for the elderly and infirm) and opportunities opened up for the private profit and non-profit sectors to enter this area. As part of the shift towards deinstitutionalization, clubs and centres for person with special needs as well as foster homes and housing communities were established. Beneficiaries now have more options and choices with services seeking to accommodate user needs through individualization. The number of homes for the old and infirm run by physical persons or NGOs (religious, humanitarian organizations, charities) has increased considerably. However, the social service market is still underdeveloped and the demand for certain services (e.g. rehabilitation institutions for addicts or homes for victims of family violence) surpasses the supply. The further decentralisation and deinstitutionalization of social services remains a key challenge. Since the end of 1990s, attention has been given in Croatia to the development of partnership between the public authorities and civil society, most obviously through the foundation of: the Government Office for NGOs; the National Foundation for Civil Society Development; the Council for Civil Society Development; and through numerous legislative changes pertaining to the role of civil society. The programme of cooperation between the Government and non–governmental non–profit sector (2001) envisages the development of a positive practice code, standards and criteria for realization of financial support to associations programs and projects. In July 2006, the Government adopted the National Strategy for the Creation of a Suitable Environment for Civil Society Development which formulates a set of measures in various areas of social life including civil society financing, development of the social economy, regional development and volunteering. A Gender Equality Act was enacted in 2003 providing for the protection against discrimination based on gender and creation of equal opportunities for men and women. Additionally, new anti-discrimination provisions have been adopted in the fields of criminal, family and labour legislation. Under the Gender Equality Act, it is forbidden to discriminate in the fields of employment and labour in the public and private sector, including government bodies, in matters related to the terms and conditions of employment, promotion at work, access to all types and levels of training, employment and working conditions, including equal pay and membership and participation in workers' or employers' associations or in any other professional organization. In addition, when advertising job vacancies, employers must state in unequivocal terms that candidates of both sexes may apply. For the purpose of enforcement of the Gender Equality Act, a Gender Equality Ombudsman was appointed in 2003 while the Office for Gender Equality as a professional body of the Government of the Republic of Croatia was established in 2004. Co-ordinators for gender equality were appointed in all state ministries and other government administration bodies, while commissions for gender equality were established at the level of the counties. The Croatian Parliament has had a Gender Equality Committee since 2001. So far Croatia has adopted three national strategies promoting gender equality. The first document, the National Equality Promotion Policy, was adopted by the Government of the Republic of Croatia in 1997. The National Policy for the Promotion of Gender 2001-2005 was adopted by the Croatian Parliament in 2001. A new National Equality Promotion Policy 2006-2010 was drafted in 2006 and was first adopted by the Economic and Social Council on 14 September and then by the Government on 15 September 2006. This document sets out objectives and a large number of measures for improvement of the general social
15 position of women and for raising the awareness for the need to respect women's human rights. In this context, improvement of the social position of women members of national minorities and women with disability, as well as elimination of discrimination against Roma women, were singled out as separate aims and measures. In the field of creating equal opportunities in the labour market, the most important objectives encompass reduction of unemployment and elimination of all forms of discrimination against women in the labour market, fostering women's entrepreneurship, ensuring genuine equal opportunities for women and men in the labour market through an efficient enforcement of labour legislation and encouragement of women to use the existing mechanisms for filing discrimination claims, as well as strengthening and promoting measures that enable reconciliation of family and professional obligations, including raising the awareness for the need to equally distribute domestic and family work between men and women. Recognizing significant progress in institutional and legislative promotion of gender equality, it is acknowledged that there is still room for improving policy implementation in this area. Statistical data on poverty and social exclusion Statistical data on poverty and social exclusion in Croatia are collected primarily by the Croatian Bureau of Statistics (CBS). In addition to the CBS’s databases, for purposes of poverty analysis it is possible to use data from other official institutions and agencies (Ministry of Finance, Ministry of Health and Social Welfare, Croatian Pension Insurance Institute, Croatian Health Insurance Institute). The two main databases on poverty and social exclusion are the Household Budget Survey (HBS) and the Labour Force Survey (LFS). The HBS is the key source of poverty data. Since 1998, it has been conducted every year by the CBS. In the first survey, in 1998, sampling did not encompass all areas of Croatia (due to war circumstances). After 2000, the sample, harmonised with the 2001 Census, covered the entire country. However, in implementation of the Survey, there is the continued problem of the lack of a good quality framework for the sample; i.e. a regularly updated register of population. The Survey consists of four questionnaires: Questionnaire for Household Members, Questionnaire for Households, Diary and a Replacement Questionnaire in case the household did not keep a Diary. The Diary is used for collection of information concerning purchase of everyday groceries (food, drinks, tobacco products and consumer goods). The survey questionnaires that are being used enable collection of large quantities of information on the living standard of the Croatian citizens and, importantly, they comply with Eurostat standards. In 2004, the CBS started publishing the Laeken indicators of social cohesion, based on HBS, covering the period from 2001 until the present. The methodology of poverty analysis has been harmonised with that of Eurostat. Data are based on income, which has also been defined in accordance with Eurostat’s recommendations. Poverty indicators are published according to the EU’s official poverty line. Since 2001, the CBS has calculated the following poverty indicators: 1) at-risk-of-poverty rate with a breakdown by age and gender, most frequent activity status and gender, household type, tenure status; 2) at-risk-of-poverty threshold (illustrative values); 3) at-risk-of-poverty rate before social transfers; 4) relative at-risk-of-poverty gap; 5) dispersion around the at-risk-of-poverty threshold; 6) inequality of income distribution - quintile share ratio; 7) inequality of income distribution – Gini coefficient. In view of the fact that HBS is not a panel survey, so far longitudinal analyses of poverty have not been possible. The CBS plans to introduce EU-SILC into the statistical system through the Program of Statistical Activities of the Republic of Croatia, 2004 – 2007. The deadlines for implementation of the EU-SILC will depend on the realisation of a Phare 2005 programme, which will define national methodology, create questionnaires, conduct pilot research projects and analyse results obtained. In addition to HBS, LFS may also be used as an additional source of data for analysis of poverty (although it primarily serves as a source of information on labour force activity). LFS has been conducted in Croatia since 1996 on a semi-annual basis, and the LFS data are published by gender. The Survey is conducted in accordance with the guidelines and requirements of ILO and Eurostat. It serves as the most important source of data for international comparison of employment and unemployment indicators, enabling comparability of Croatia with EU countries (as well as all other countries conducting LFS) and monitoring of employment and unemployment indicators over time periods.
16 The following Laeken indicators are calculated on the basis of LFS: 1) long-term unemployment rate; 2) persons living in jobless households; 3) early school-leavers not in education or training; 4) long-term unemployment share; 5) very long-term unemployment rate; and 6) persons with low educational attainment. Life expectancy at birth is calculated by the Population Division. The LFS data have been regularly submitted to Eurostat since the reference year 2002, while the HBS data have so far not been submitted to Eurostat (data submission deadline for 2005 is until the end of 2007). Despite being representative on the national level, LFS and HCS are not representative on the county level, which prevents a reliable insight into the regional distribution of poverty and similar regional indicators. Also, it is not possible to calculate the at-persistent-risk-of-poverty rate with a breakdown by gender and the self- defined health status by income level on the basis of LFS or HBS (however, due to non-harmonised methodology, the latter is not calculated in other European countries either). The CBS plans to regularly collect social protection data under the ESSPROS methodology. So far, the organisational chart of the social protection system in the country has been defined, cooperation has been established with institutions that are included in the social system, 15 social protection schemes have been identified, descriptive data on various benefits encompassed by individual schemes have been collected and the work has started on the collection of financial data on revenues and expenditures in 2003. The main limitation of the official statistical data on poverty and social exclusion is the insufficiency or lack of information on members of national minorities. A second problem is the lack of necessary data on the number and structure of persons with disabilities (such data cannot be extrapolated from HBS), so in its reports the CBS (like Eurostat) does not publish the at-risk-of-poverty rate for this group. There is also a need for more diverse data on various migrant features, and the homeless and stateless persons and regional statistics require further development. As a relatively new area of statistical monitoring, gender statistics is developing gradually.
Conclusion In the relatively short time since the end of the war, and particularly since engaging in the process of accession to the EU, Croatia has made ambitious commitments to modernisation and reform, in relation to policies concerning the development of human resources. Given the scale of the commitments, the limits to available resources and the unfamiliar nature of many of the challenges confronted, there is an increasing need to highlight the challenges which must be faced in meeting the very significant demands being placed on the Public Administration as a consequence. Accordingly, Croatia considers that it is not merely desirable but necessary to establish a professional, efficient, accountable, transparent and independent public administration at national and local level. Precisely because of this, it is proposed to concentrate the assistance delivered through this IPA Operational Programme (and the three others related to Components III) first and foremost on developing the capacity of the key relevant public institutions at both the national and local level. This should also include, when appropriate, the provision of assistance to ensure that adequate statistics are available to effectively monitor and evaluate the activities delivered through this operational programme and to inform policy decisions.
1.1.4 Strategic Development Framework (SDF) 2006-2013 In August 2006 the Croatian Government adopted the Strategic Development Framework 2006-2013 (SDF) as a document that defines national development goals. Those SDF policies most relevant to IPA components III and IV include establishing a strong entrepreneurial sector as the main driver of the economy, underpinned by a flexible and socially inclusive labour market able to respond to the requirements of the economy and an efficient education system capable of providing a labour force appropriate to the needs of the labour market. The SDF’s chapter on People and Knowledge begins by noting that competitiveness and economic growth do not achieve their social goal if they fail to ensure more high-quality jobs. At the same time, the characteristics of the labour market, the structure and quality of the workforce, and the quality of social dialogue affect the level of competitiveness and economic growth. After describing the characteristics of the
17 labour market in Croatia, the SDF goes on to identify the following goals in relation to People and Knowledge: • Strengthen the active role that institutions of the labour market have in the process of balancing labour force supply and demand; • Reduce long-term unemployment and promote lifelong learning; • Modernise vocational education in line with economic demands; • Extend the duration of compulsory education; • Increase the share of people with higher education in the total population; • Increase total allocations to education, but also the efficiency of spending available funds; • Stimulate the participation of the private sector in the financing of regular education and in-service training. Moreover, in relation to social cohesion and social justice, the SDF highlights the fact that societies where 'tolerance' has priority over 'self-promotion at any cost' generally achieve a higher degree of social cohesion and social efficiency, which is key to establishing a knowledge-based society. It also emphasises the principle of social responsibility of private companies through active labour market policy needs being directed towards long-term unemployed persons including vulnerable groups facing unemployment. In particular, the SDF identifies the following goals in relation to social cohesion and social justice: • Increase the share of the poorest 10% of the population in the total division of income and reduce the percentage of the population at risk of poverty; • Increase the efficiency of the system of social transfers; • Promote social dialogue, alternative dispute resolution, equality before the law, justice, and protect the principle of innocence until proven otherwise; • Devote special attention to the protection of childhood and the development of children; • Promote all forms of creative activities that are an important factor in social cohesion; • Promote corporate social responsibility. In the context of this Operational Programme and the policy areas it addresses, the Strategic Development Framework provides the key strategic direction at national level. In particular, it highlights the need to increase the level of employment. This will require an intensification of activities by the Croatian Employment Service including, in particular, the development of measures to promote active labour market policies. At a more strategic level, the CES needs to strengthen its capacity to monitor labour market movements and anticipate needs including the building of more proactive communication with employers and other partner institutions such as the Agency for Vocational Education.
1.2 The EU policy context
1.2.1 Cohesion policy In 2005, the European Council affirmed that all appropriate national and Community resources, including those of cohesion policy (i.e. the Structural and Cohesion Funds), should be used to pursue the objectives of the renewed Lisbon Agenda and its economic policy and employment guidelines. In relation to the development of human capital in particular, the employment guidelines of the Lisbon agenda identify three priorities: • To attract and retain more people in employment and modernize social protection systems; • To improve adaptability of workers and enterprises and the flexibility of the labour markets; and • To increase investment in human capital through better education and skills.
18 (The compatibility of the priorities of this OP with those of the Lisbon Agenda is made clear in Section 3 below.) In addition to these priorities, the Council highlighted the need for appropriate attention to be given to investments to improve efficiency in public administration, as well as to education, social, health and cultural infrastructures. Following the major reform of the EU’s Cohesion Policies covering the 2007-2013 period, the policy focus has shifted increasingly towards the Union’s strategic priorities for a competitive and sustainable knowledge- based economy geared towards implementing the reforms in a manner that is compatible with the Lisbon and Gothenburg agendas. In the context of this Operational Programme, the Commission's Communication on Cohesion Policy in Support of Growth and Jobs: Community Strategic Guidelines, 2007-2013 is of direct relevance, in particular Guideline 3 on the objective of: 'creating more and better jobs by attracting more people into employment or entrepreneurial activity, improving adaptability of workers and enterprises and increasing investment in human capital.' In the particular case of Croatia, this objective will serve as a key strategic policy framework within which employment and HRD-related priorities will be established both under this Operational Programme as well as under future ESF assistance.
1.2.2 Pre-accession assistance Instrument for Pre-Accession Assistance (IPA) The Instrument for Pre-Accession Assistance (IPA), was established by Council Regulation EC No 1085/2006 of 17 July 2006. It provides the overall framework within which pre-accession assistance will be made available to both candidate and potential candidate countries. As of 2007, the instrument as a whole is open to Croatia and should provide assistance to build institutional capacity for the efficient implementation of the acquis communautaire as well as to prepare for the management of the Structural and Cohesion Funds on accession (aligning as appropriate with the priorities identified under the Accession Partnership) In bringing together pre-accession assistance across a range of instruments, IPA consists of five Components, namely: • Component I – Transition Assistance and Institution Building • Component I – Regional and Cross-Border Cooperation • Component III – Regional Development • Component IV – Human Resources Development • Component V – Rural Development In the context of this Operational Programme, Component IV is designed to assist the candidate countries in policy development and to prepare them for the implementation and management of the Community’s Cohesion policy, in particular the European Social Fund. The priorities for assistance identified in respect of Component IV are set out under Article 151 of the IPA Implementing Regulation4) and are summarised hereunder: • Operations that increase adaptability of workers, enterprises and entrepreneurs; • Enhancement of access to employment and sustainable inclusion in the labour market;
4 Commission Regulation (EC) No 718/2007 of 12 June 2007 implementing Council Regulation (EC) No 1085/2006 establishing and Instrument for Pre-accession Assistance (IPA)
19 • Reinforcement of social inclusion and integration of people at a disadvantage; • Promotion of partnerships, pacts and initiatives through networking of relevant stakeholders for reforms in the field of employment and labour market inclusiveness; • Operations that expand and enhance investment in human capital; • Strengthening the institutional capacity and efficiency of relevant public administrations public services and partnerships; • Technical assistance to support the management of the operational programme and prepare for the future management of European Structural Funds. Given the relatively low level of assistance available under this component, this Operational Programme will focus on a limited number of priorities and accompanying measures with an in-built capacity for further elaboration and development under future ESF where more significant levels of funding will be available.
Multi-annual Indicative Financial Framework (MIFF) The Multi-annual Indicative Financial Framework (MIFF) provides an indicative allocation of funds per beneficiary and per component. It is established in a 'rolling 3-year' basis. As referred to above, the allocations to component IV are relatively limited in financial allocation terms and will be in the 8-11% range on an ascending scale. Multi-annual Indicative Planning Document (MIPD) The Multi-annual Indicative Planning Document (MIPD) is the Commission's planning and strategic document covering all IPA Components. In line with the MIFF, it is established on a 'three-year rolling' period with annual reviews in line with the procedures established under the (draft) Implementing Regulation. In relation to Component IV in particular, the MIPD identifies four 'major areas of intervention' for Croatia and specifies priorities under each as summarised hereunder: 1. Attracting and retaining more people in employment – main priorities: Increase participation in employment and strengthen both active and preventive labour market measures. Promote occupational and geographical mobility and develop more effective 'matching' of labour supply and demand (incl. development of 'synergies' with the "competitiveness' elements of component III). Address regional disparities in employment. Reinforce social inclusion at local and regional level through better targeting of vulnerable groups including enhanced access to employment and labour market re-integration of job- seekers and the inactive. 2. Improving adaptability of enterprises – main priorities: Develop a more anticipatory approach to work and economic change and increase investment in competencies and qualifications of both workers and enterprises. Encourage active ageing and longer working lives. Promote a culture of entrepreneurship and develop more innovative and productive forms of work organisation. Promote a more flexible labour market in conjunction with more efficient social security measures. Further strengthen social dialogue bipartite mechanisms and promote a more active role on the part of the social partners. 3. As part of developing a coherent HRD policy and national qualifications framework, increase the overall efficiency and quality of the education and training systems to promote greater employability. Strengthen human capital investment through better education and skills and the promotion of knowledge, research and innovation. Improve the labour market relevance of initial and continuing vocational education and training. Develop the overall offer, access and quality of adult provision as part of a life-long learning strategy. 4. Strengthening administrative capacity – main priorities: Develop institutional capacity and efficiency of public administration in the employment, education, and social fields. Strengthen the effectiveness of labour market institutions, in particular the employment services.
20 As a cross-cutting' requirement, all operations carried out in respect of the above-mentioned priorities should fulfil the requirement of promoting equality between men and women including the integration of the gender perspective during the various stages of implementation. Strategic Coherence Framework (SCF) The Republic of Croatia’s Strategic Coherence Framework (SCF) sets the major policy objectives and priorities to be supported by IPA Components III & IV in Croatia for the period 2007-2013. The SCF is based on the priorities from the Accession Partnership with Croatia, and the Community Strategic Guidelines, and on Croatia’s national Strategic Development Framework 2006-2013 (all mentioned above). This OP reflects the SCF’s proposals in relation to IPA Component IV and provides further detail. The SCF provides that assistance made available to Croatia under IPA Component IV will concentrate in the first instance on measures that will improve systems and administrative capacity in the field of employment, education and social inclusion as well as networking with partners from non-governmental sector in line with the medium-term priorities of the Accession Partnership. The SCF was adopted by the Croatian Government on 25 May 2006.
1.2.3 Joint Inclusion Memorandum (JIM) As in the case of other candidate countries, Croatia has prepared (and already concluded in March 2007) a Joint Inclusion Memorandum (JIM) with the European Commission in order to move towards full participation in the area of EU social inclusion policy upon accession. To this end, where deemed appropriate, the priorities identified in this Operational Programme are in line with the key priorities and challenges identified hereunder. Under the JIM, the Government of the Republic of Croatia and the European Commission identified the following challenges in the fight against poverty and social exclusion: • To raise the level of employment and create greater employment opportunities for the long-term unemployed and other vulnerable groups in the labour market including the integration of people with disabilities; • To improve the education structure of the population, harmonise education with the labour market requirements and stimulate adult education; • To financially stabilise the health system without jeopardising equal access to health services; • To expand the network of social services, developing a system of community-based services and improving access to services; • To facilitate access to housing for socially at-risk groups; • To promote gender equality in combating poverty and social inclusion and to take into account the gender differences in the policy formulation and implementation; • To enable revitalisation and sustainable development of deprived areas and promote a regionally balanced development of Croatia. The joint parties to the document also agreed that the policy priorities in combating poverty and social exclusion should be as follows: • To raise the employability of those groups most affected by long-term unemployment and inactivity, primarily by focusing active labour market policy measures on persons with disabilities, Roma, older workers, and former addicts; in employment, to give special attention to eliminating discrimination against women; to ensure full implementation of the minority employment provisions of the Constitutional Law on National Minorities; to keep records on the participation of social assistance users in active labour market programmes; • To broaden secondary and higher education coverage (by broadening compulsory education, by monitoring and reducing the number of early school-leavers, i.e. by promoting the completion of different types of education in accordance with labour market needs and by implementing measures to ensure
21 successful graduation and shorten the duration of studies); to reform vocational education in order to adjust it to labour market requirements; to invest more in and systematically promote life-long learning; • To expand the network of social services for children, the elderly and persons with disabilities (particularly in small towns and rural areas); to establish an action plan to deinstitutionalise services for children and people with disabilities (to stop building new institutions, to expand alternative forms of social services and to reduce the number of beneficiaries in welfare institutions); to support the provision of services within the community where beneficiaries live; to develop a strategy for the decentralisation of social services (delegation of ‘founding rights’ for all welfare homes to county level) with the focus on lagging-behind regions5; to foster cooperation between local communities and NGOs in the provision of services; to give beneficiaries a choice; to promote better reconciliation between work and private life, especially for women, by investing in childcare structures; • To put stronger efforts into the prevention of disease or disability (more frequent health checks); to provide equal access to health services for the entire population (in particular for those living on islands, mountainous areas, etc.); • To define and develop a concept of social housing; to develop a more adequate system of housing allowances and assistance for households in a poor housing situation; to build capacity for shelters for the homeless; to speed up the solution of housing problems for returning refugees, through housing care programmes, particularly for former tenancy-right holders. • Through economic and fiscal policy measures, to work systematically on the reduction of regional and urban/rural differences; to develop economic projects adjusted to local conditions and aligned with the county strategies for development and regional action plans; to offer better financial support to NGO programmes aimed at multi-deprived areas. • To agree on a long-term and sustainable solution to the problem of poverty among senior citizens, protecting them during the period of transition through targeted social assistance programmes. • To ensure access for all to quality health services, to monitor and evaluate the implementation of the “National Health Development Strategy 2006-2011” regarding its impact on the alleviation of poverty and social exclusion. Under its concluding chapter 8, the follow-up process assumes particular focus in ensuring that the priorities and challenges are closely monitored including in particular the decentralization and de-institutionalization of social services.
1.2.4 Joint Assessment of Employment Priorities (JAP) The Joint Assessment Paper of Employment Priorities (JAP) provides a joint basis for action in the area of employment policy in line with the EU Employment Strategy. The main purpose of the JAP is to provide a comprehensive analysis of the economic situation and related developments as well as the labour market situation and related employment policy objectives. In terms of establishing complementarity with this Operational Programme, the indicative policy objectives outlined hereunder provide a wider policy framework within which the programme will concentrate on a range of strategic priorities designed to strengthen preparations for future assistance under the European Social Fund (ESF). Within the area of the upper secondary education, policy will focus on prolonging compulsory education as well further increasing the share of graduates in order to promote stronger social cohesion. At the same time, specific steps have to be taken to reform vocational educational and training (VET) in order to improve its responsiveness to labour market demand. In this context, further development of a Croatian
5 The Areas of Special State Concern are defined by the Law on the Areas of Special State concern (Official Gazette 44/96 and 26/03). These areas include the local self-government units (municipalities and towns) which have been occupied during the Homeland War and those considered underdeveloped based on the economic, demographic and structural difficulties criteria as well as special criteria (border and areas contaminated with land-mines).
22 Qualifications Framework (CROQF) will assume an important policy focus. Although available data on adult education and training needs to be strengthened, the estimated overall participation of adults remains low by EU standards. In this context, recently-established institutions have to be further strengthened with the aim of developing models of adult education which will respond more effectively to the needs of the individuals as well as those of the labour market. In order that the Croatian Employment Service (CES) becomes a more effective labour instrument responding to changing labour market requirements, it is necessary to improve its mediation performance and upgrade its role through further modernisation and reorganisation. In this context, policy focus will be geared towards ensuring higher participation of the unemployed in active labour market measures, supported by effective evaluation of their impact and effects. In conclusion, measures aimed at increasing the number of higher education graduates, as well as the expansion of the service sector, should contribute to a rise in the employment and earnings of women with a consequent positive impact in reducing gender disparities. Based on the strategic policy priorities identified within the JAP, the key challenges can be summarised as follows - • Develop a 'lifecycle approach' to work which addresses youth unemployment, long-term unemployment and 'pathways' to employment, increased female participation especially for low- skilled women as well as a better reconciliation of work and family life and support for active ageing • Promote a more 'inclusive labour market' incorporating active and preventive labour market measures • Foster a better 'matching' of labour market needs through modernisation of the labour market institutions and better anticipation of skills needs, labour market shortages and 'bottlenecks' • Improve adaptability of workers and enterprises including the establishment of more flexible working arrangements • Promote flexibility with employment security incorporating a review of contractual and working time arrangements, new forms of work organisation as well as better anticipation and management of change, and • Increase investment in human capital including better access to initial and continuing education and training, increased access to education and adequate provision of training for the unemployed and disadvantaged, strengthened education and training systems in response to new competency, and adaptability requirements and increased provision for adult learning as part of a comprehensive life-long framework. From an institutional perspective, the promotion of 'good governance' is identified as a cornerstone of Croatia's labour market reform strategy.
1.3 Process of elaborating the Operational Programme
1.3.1 Co-ordination and consultation The Human Resources Development Operational Programme (HRDOP) represents the single OP through which assistance under Component IV is channelled. The OP has been prepared by an Inter- Ministerial Working Group (IWG) comprising representatives of the relevant state institutions and chaired by the Strategic Co-ordinator. The membership is listed in Annex 1. Having drafted the OPs initially through a process of inter-ministerial coordination, the next stage involved consulting representatives of employees (trade unions), employers (the business community) and local self- government (municipalities) as well as other civil society organisations (non-governmental organisations). The partner consultations took place on 23 March 2007 in Zagreb. The MELE invited 31 partner organizations and 25 representatives of the partners participated in the consultations. The HRDOP was
23 presented by State Secretary Ms Vera Babić MELE, Ms Dorica Nikolić MHSW, State Secretary Želimir Janjić MSES and Ms Suzana Kovačević CODEF. Possible projects were presented by Inga Žic, MELE (projects from the field of labour and employment), Mirjana Radovan, MHSW (projects from the area of the social inclusion) and Mr Ivan Šutalo, AVET (projects from area of vocational training and education of adults). The consultation was chaired by Mrs Katarina Ivanković Knežević, MELE. After the presentations of priorities and projects there was a discussion of the HRDOP summary which had previously been distributed to the partners. Three organisations had responded in writing to the summary OP by the date of the consultation. Based on the discussion at the meeting and the written comments received by the date of the consultation, the following conclusions were reached: • As the need for respecting the regional components in the implementation process of priorities and possible projects was stressed several times, the representatives of the MAs agreed that during the implementation of the OP the particular needs of specific counties should be taken into account. They also stressed the need to coordinate with the other IPA Components, especially Regional Competitiveness Operational Programme. • Some partner representatives expressed the view that the OP should be expanded to also cover mainstream higher education. At the meeting it was agreed that due to the relatively small amount of funds available, the focus should remain on vocational education but also include higher level professional education. • It was agreed that the Government Council for Development of the Civil Society should be included in future consultation. • Regarding the priority related to the strengthening of administrative capacity, it was stressed that the strengthening of the Operating Structure for IPA Component IV should be a priority in order to enhance the absorption ability of Croatia to use funds from both the pre-accession funds and later Structural Funds. • The technical assistance Priority Axis should include support for activities in relation to labour market analysis, demand for specific skills and the strengthening of Croatian statistics on human resources in general. All the participants of the consultations were asked to send written comments by 28th March 2007 on the Summary of the OP. The MELE by that date received altogether 6 written comments (including the 3 received before the meeting). The comments related to: the improvement of conditions for persons with disability; the new role of the partners in the process of the development of the economy; the strengthening of institutions at all levels; the further development of the concepts of full employment and employment for all; the further development of higher education, and positioning of Croatia as knowledge-based society. The Inter-Ministerial Working Group (IWG) have carefully discussed all of the received comments and concluded the following: • Civil society will be included in the future development of the OP, and in its implementation. • Many partners stressed the need for including the higher education in the OP; the Inter-Ministerial Working Group (IWG) has accept that view and decided that higher education issues should be eligible for support by the OP but only insofar as they pertain to higher-level professional/vocational education. A list of those who attended the partnership consultation meeting and who provided comments is attached in Annex 2.
1.3.2 Ex ante evaluation An ex ante evaluation of this OP was undertaken by an independent evaluation team during March and April 2007. The evaluation comprised desk research and a series of meetings and interviews undertaken and led by a team of international evaluators supported by locally-based evaluators directly recruited by them. The summary conclusions of the evaluation were as follows:
24 “The OP provides coherent and accessible coverage of the key issues under Human Resource Development, according to the Commission template for IPA OPs. The OP broadly integrates EU and Croatian priorities in the field. Although there are some gaps in the analysis, it provides a sound basis for the strategic approach taken by the programme. The structure of objectives and priorities flows logically from the analysis, though there could be room for further consideration of the structure of some priorities and measures. Systems for monitoring and evaluation and management and implementation have evolved between OP drafts but some further detail and clarification is required in certain areas. Taking each of the three main policy headings in turn (employment, education and training and social inclusion), there are some areas where additional information could be added to the analysis, or the text restructured, to strengthen the justification for strategic objectives. Closer attention could be paid to the link between the SWOT and the analysis as there are some gaps and inconsistencies where specific aspects of the SWOT do not relate clearly to issues in the background analysis. There is a need for some further consideration of the structure of the priorities and measures. For instance, a general concern is that there is quite a large variety of activity streams included under some priorities and that these activities vary considerably in their nature and scope. More detail on how decisions on the allocation of resources and the sequencing of financial flows to different measures over the first three years would be valuable. It would be helpful to provide more detail on the Programme’s coherence with the Lisbon strategy and other IPA OPs. Work on indicators is still in progress and there are still significant gaps. Similarly, the consultation process was still in progress during the ex ante evaluation. Currently, the description of the consultation arrangements provides only a broad outline and more detail of the process and its outcome will be added in the next draft. Additionally, on the issues of programme management and implementation, some clarification concerning the identity, functions and timetable for the introduction of Implementing Bodies, and their relationship to other management bodies is required. Within the OP, environment is not well integrated. To address this issue, a broader interpretation of environment could be adopted''. The evaluators provided detailed recommendations for the improvement of the OP which were generally balanced and constructive and have been taken into account as appropriate: • The comments on the analytical section were deemed clear and constructive and many of those have been addressed. Moreover, the recommendation to provide more data on the administrative capacity of public employment services has been taken into account, as well as the suggestion to use a more inclusive definition of “employment”, to add a new heading on regional disparities and consider targeted support for the regions that lack labour supplies. It needs to be stated, however, that much of the additional data requirements proposed are not currently available, namely, additional information on the “mismatch” between the skill base of working-age population and the demands of employers; data on ICT skills of the workforce and the impact of ICT development trends on the labour force; data on regional-specific variations in skill needs; data on internal migration processes and labour force mobility; data on the elderly working in subsistence agriculture. It is acknowledged that these information gaps should be clearly identified and remedied to strengthen management and implementation of the Structural Funds on accession; • The comments on the SWOT analysis accurately identified some inconsistencies between the earlier version and the analytical section, which have now been rectified; • The comments on the rationale and consistency of the strategy in fact resulted from presentational weaknesses and re-structuring of priorities and measures which have also been addressed. The suggestion that Priority 1 should be restructured to include more than one measure was taken into account as well as the suggestion to prioritize potential activities. Moreover, the suggestion to establish a closer linkage with the Lisbon Strategy and the JIM document was accepted and implemented. Selection criteria for specific measures were also defined in more detail. • The comments on results and impact were largely constructive although at certain points more appropriate to Structural Funds than to IPA. The recommendation to prepare a common set of indicator methodologies and definitions was particularly useful and taken into account. Significant additional effort has been invested to more clearly define monitoring indicators at the priority axis and measure level, to define their baseline value and sources for their collection. The evaluators also recommended development of the basic sheet of agreed indicators for projects so that they can develop comparable,
25 collectable data for aggregation that breaks information down into target groups in the relevant measures. This suggestion was welcomed; it has, however, not been incorporated in the OP but will be taken into consideration in the next stages of the OP implementation; • At the time of the ex-ante evaluation, there were many uncertainties regarding the management and implementation system for the OP that the evaluators rightfully addressed. In this context, their suggestion to provide more clarification with respect to this system has been taken into account in the later discussion with the European Commission services and the revision of Section 5 of the Operational Programme on implementing provisions; • Finally, the points made in relation to environmental integration have also been incorporated to the extent that they are feasible. The OP does not contain specific references to environment protection due to the fact that, at this stage, specific projects are not elaborated to the point that would inform an assessment of their environmental dimension. No major infrastructure projects are envisaged in the OP, which implies that no environmental impact assessment measures are to be carried out. The OP will, however, include steps to ensure that promotion of environmental protection and sustainable development will be included in information and publicity campaigns targeted towards the applicants for assistance who will be expected to provide a statement of assurance or demonstrate that their projects have no detrimental impact on the environment. All the recommendations provided by ex-ante evaluators were discussed among the members of the Inter- Ministerial Working Group and significantly contributed to a more coherent and precise formulation of specific priorities and measures within the Programme. A copy of the full evaluation report is attached to the Operational Programme under Annex 6.
26 2. ASSESSMENT OF MEDIUM TERM NEEDS AND OBJECTIVES 6
2.1 Socio-economic analysis
This section of the Operational Programme presents and analyses information on relevant aspects of the Croatian context in order to identify needs and establish development priorities in an informed and accurate fashion.
2.1.1 Demography and public health According to the 2001 Census, Croatia had 4,437,460 inhabitants. During the last several years, the number of live births has been lower than the number of deaths, thus the natural increase has been negative (see Table 2: Population Data). On the other hand, net migration, particularly from Bosnia and Herzegovina, has been positive, offsetting the negative natural increase. Therefore the estimated population in 2005 was somewhat larger – around 4,442,000 inhabitants. The extent of size of net migration has declined in the last several years, but the number of live births has increased. As shown in Table 3, Croatia’s demographic outlook is shared by Germany, Hungary and Bulgaria, all these countries lagging behind the European average. Regarding age structure, the share of the old has been growing and the share of the young has been declining. Over the period between 1991 and 2005, the share of the population aged 65 and over increased from 11.8 to 16.6 percent (See Table 4). Unless offset by positive net immigration, the “ageing” of the Croatian population will continue because the young demographic cohorts are significantly less numerous than the older ones. For example, it is estimated that, in 2005, there were around 336,000 people aged 45- 49, but only 296,099 people aged 30-34 and only 275,000 aged 15-19. The number of young persons entering the labour force has been falling and will fall further in the future. Both the growth of older population and the shrinking of work-age population have been and will be a great problem for the system of social security transfers and public health care spending but also for the future labour supply. In order to sustain similar levels of benefits for the increasing number of beneficiaries, a higher rate of labour force participation will be needed. Life expectancy is 72.3 years for men and 79.2 for women. In EU-27 it is 76.5 for men and 80.6 for women (2005 figures). The infant mortality rate for EU-27 is 5.37 (2005) and for Croatia it is 5.7.In the majority of the post-communist countries the rate is around 7. Early neo-natal death is higher than in the more developed EU countries (4 in relation to 2.5 on average). According to comparable estimates based on the national labour force survey (NLFS), the activity rate of the population aged 15-64 has been growing from 61.6% in 2001 to 63.5% in 2006. A breakdown of the activity rates by sex and age groups shows that the activity rate for the age group 15-24 has decreased from 2001 to 2006 (from 40.8% to 38.0%). The decrease has been more pronounced for women than for men (women: 38.1%-34.5%: men: 42.9%-41.1%). These activity rates are below the EU averages and the Lisbon targets will be difficult to achieve especially since the educational attainment of the working age inactive population is weaker than average (See Table 5). The active population is unevenly distributed in Croatia. Four counties (Town of Zagreb, Split-Dalmatia, Primorje-Gorski kotar and Osjek-Baranja counties) account for 40% of the active population. Between 2000 and 2006 the active population has increased by 8.9% but most of this increase (67.8%) occurred in the above counties with decreases or below 1% increases of the active population in seven out of 21 counties. The demographic framework for labour supply in Croatia is regressive with relatively low labour utilization and high working age demographic reserves. Policy measures need to reflect a strategy for increasing
6Analytical tables and figures relevant to this section are provided at ANNEX 3.
27 activity levels with focus on geographic distribution and particular groups such as women who consistently have a worsening labour market position.
2.1.2 Employment and unemployment Introduction After a decade of falling registered employment, during and immediately after the war, employment in Croatia started to grow in 2001. From 2000 to 2006, employment rose from 1.34 to 1.47 million or 9.5%. LFS employment which includes all undocumented and informal economic activities is even higher at 1.62 million and a growth rate of around 10%. The growth rate of employment in small trades and crafts was particularly large, from 216,395 in 2001 to 262,690 in 2006 (i.e. 21.4%). The expansion of the “secondary” sector of small trades and crafts demonstrates flexibility and job-creation potential of that sector. On the other hand, this sector may also be associated with relatively low wages, long working hours, low job security and a relatively large amount of informal activities. According to LFS data, the employment rate of the population aged 15-64 in Croatia amounted to a yearly average in 2006 of 55.4%. That was 7.7 percentage points lower than the EU-27 average but higher than in Poland (see also Table 6). At the same time, the male employment rate was 62.3%, and the female 51.0%, the latter higher than in Greece or Italy. At the annual level, the employment rate for the aged 55-64 was particularly low, just 34.3% versus 43.5% in the EU-27. However, it is possible to observe a positive trend in the employment rate of the older persons (55-64) in Croatia due to the effect of the pension system reform which has gradually increased the retirement age. The low level of employment in general and of older persons in particular is mostly a consequence of the war destruction of economic capacities, and restructuring due to privatization, foreign competition, and changes in demand and technology. Further privatization, opening to foreign competition and reduction of state aid to enterprises can reduce employment in the short run, but it can increase productivity and thus labour demand in the long run. Enhanced entrepreneurship is also expected to contribute to long-term job- creation. In general, employment opportunities are increasing in Croatia but job creation is very unevenly distributed and not adequate to absorb the labour surplus which has been generated over the transition period on the unemployment register. For example, monthly employment from the register of the Croatian employment service which still registers most of the labour market dynamics ranges from 10 to 20 thousand depending on the season. There are roughly between 13 and 26 unemployed per vacancy at any one time and the structure of the supply and demand is not congruent resulting in high employment rates for some groups and almost no demand for others7. Employment by sector In comparison to the EU-27, Croatia has a considerably larger share of those employed in agriculture (13.80% vs. 5.89%) and a somewhat larger share of those employed in industry which includes mining, manufacturing, utilities and construction (28.50% vs. 27.64% - see Table 7). The share of those employed in industry in 2006 was 0.86 percentage points higher than in the EU but lower than in Bulgaria, Poland, Czech Republic, Slovenia, Slovakia, Hungary, Germany, Portugal and Spain (see Table 7). The share of those employed in market services (wholesale and retail trade, hotels and restaurants, transport and communication, and business services) was only 1.9 percentage points below EU-27 but at a higher level than all other new members except Hungary. The difference in the share of those employed in non-market services (education, social security, and other services – NACE categories M-Q) between Croatia and the EU-27 was somewhat higher – 6.0 percentage points in favour of the EU. The share of public administration in total employment at 6.3% in 2006 was below the EU-27 (7.12%) but also much lower than France, Greece, Germany, Hungary, Czech Republic, Bulgaria and Slovakia.
7 See Monthly Statistics Bulletin, Croatian Employment service, Table 3, various months 2006, 2007.
28 The sectoral structure of employment in Croatia is more similar to the EU than in most new member states and will converge further especially in the area of market services due to a growing interest of the private sector in this domain and the growing market for health, insurance and educational services across-the- board. This will increase employment opportunities for women who are traditionally more dominant in these sectors. However, this will also increase the overall flexibility of the labour market. Flexible forms of employment Regarding flexible forms of employment, the share of employees with limited duration contract in the total number of employees is not substantially lower than in the EU-27. In 2006, that share amounted to 12.5% in Croatia and 14.3% in the EU-27 (see Table 8b). In some countries, like Poland (27.3%) and Slovenia (17.1%), it was much higher, and in Spain it comprised a third of all employees (34.1%), more among women than among men. Both in the EU and in Croatia, there were no significant differences between sexes in this respect (among temporary workers 54% are men and 46% women). Another flexible form of employment is part-time employment. In 2006, the share of the employed working part-time in the total number of the employed was considerably lower in Croatia (10.1%) than in the EU (18.1%). The difference is particularly large for women – more than 31.2% of employed women in the EU work part-time, while in Croatia the share is only 13.4%. A relatively low share of part-time work among the employed in general and employed women in particular is also a feature of other transition countries like Slovakia, the Czech Republic, Slovenia and Bulgaria but also of EU Member States such as Greece, Spain and Portugal. It is likely that the expected return from a part-time job in those countries, including Croatia, is still too low for women to justify the fixed costs of working (transportation costs in time and money, childcare expenses, etc.). Short-term service contracts are much more usual in Croatia than part-time work. Both the employed and the unemployed8 can engage in work of this kind and there are, on average about 60 thousand such contracts monthly. Mandatory contributions are levied on these contracts; which has introduced more security for individuals who engage in this type of work. However, these contracts are not considered to be employment as such and are outside the realm of the Labour Law. The informal sector The size of the informal sector is difficult to estimate. There are no estimates of the size of the informal sector in Croatia more recent than 2004. Some estimates for the period 1990-2000 have shown an increase in the size of the informal sector in the early 1990s, due to war and hyperinflation and then a decrease in the second half of the decade where it was estimated to be 10.4%. Most of the flexible forms of work are found in the informal economy. The most common practice in the informal economy is the truncation of the wage into two parts: the minimum mandatory wage is declared as the taxable wage on which contributions are levied while the rest of the wage is given in cash. In this way the head count of those employed in the informal economy is relatively low but the informal financial flows are considerable. The incidence of the informal sector is an important issue in policy development. Care has to be taken that labour market policies do not increase the unemployment trap for those who are both registered as unemployed and working in the informal economy by raising their reservation wage for entry into formal employment.
8 The unemployed are allowed to work on such contracts and retain unemployment status if these earnings do not exceed the current level of unemployment benefit.
29 Unemployment The increase in the employment rate described above was accompanied by a decrease in the ILO unemployment rate from 16.1% in 2000 to 11.2% in 2006. The registered unemployment rate is much higher at 16.6% in 2006 but converging to LFS levels over time. The difference between unemployment rates of women from two sources (20.9% in relation to 12.4%) is particularly pronounced which points to high levels of inactivity or informal activity in this group. 47% of women on the unemployment register in 2006 did not measure up to international criteria for the definition of unemployment. The Croatian LFS unemployment rate is only 3 percentage points higher than the EU27 rate but the long-term unemployment rate in Croatia is 6.4% while it is 3.6% in EU27 (2006). In absolute terms registered unemployment has been reduced to levels at the beginning of the 90’s which is due to several factors. Firstly, the legislature has introduced more stringent rules in the Croatian Employment Service (CES) regarding monitoring of earnings of the unemployed, active job search and availability for work. Secondly, the demand for labour has increased which has two effects: on the one hand the inflow into unemployment, especially from inactivity has increased and the outflow from the register has also increased. Fluctuation of this kind as measured by the sum of inflows and outflows in relation to the stock of the unemployed has increased by 21% from 2000 to 2006. The third factor is the appearance of competition in mediation from the private sector and internet supported job search which has brought the job seekers and the employers into direct contact. This has particularly had an effect on young job seekers (15- 24) whose share in registered unemployment fell from 27.4% in 2001 to 20.1% in 2006. This change has also been brought about by the increased interest for higher education, which is also shown in the next section on education. Characteristic for the Croatian labour market are strong seasonal fluctuations, which affect both regional labour markets and certain sectors such as agriculture, tourism, trade and construction and food production among others. For example, the number of the registered employed went up from January to June 2006 by more than 90 thousand while registered unemployment went down in the same period by 40 thousand. Although short in duration, seasonal employment gives an opportunity to break a potentially long spell of unemployment or inactivity. Unemployment in Croatia has a number of particularly concerning aspects: 55% of all unemployed people are long-term unemployed, but only 22.8% claim unemployment benefit (2006 average) since the maximum duration of benefit is shorter than average duration of unemployment. Croatia’s had a long term unemployment rate of 6.4% in 2005 compared with the EU-27 average of 3.6% and an even higher female long-term unemployment rate of 8.4%. Women are affected by unemployment more than men. Their share among all registered unemployed increased from 53.5% in 2001 to 60.0% in 2006, but a high percentage (47.5%) are not unemployed by international standards since they are either working in the informal economy, are not actively seeking work or are not available for work. The main motive for registration is often benefits which are linked to unemployment status or part of the demographic policy. In relation to those aged 50 and over, in 2001 their share was only 12.5% of the registered unemployed but this rose steadily to 24.5% in 2006. This can be attributed to the various factors; firstly, the ratio of the older population in the total number of people has increased due to demographic changes. Secondly, retirement age has been raised and consequently older persons losing a job increasingly enter among the unemployed (versus inactive) and stay longer in this category. Finally, it is also important to note the trend of decreasing share of registered unemployed among the young probably due to the opening up of new jobs, which is especially conducive to their employment.
30 The share of unemployed persons between 15-24 years of age among all registered unemployed decreased from 27.3% in 2001 to 19.4% in 2006.9 This is thought to be largely due to the prolongation of participation by young people in education and a preference for seeking work without registering at the CES. However, youth unemployment remains significantly higher than the EU average. The educational attainment and skills of the unemployed is one of the factors contributing to long-term unemployment, especially among older persons. 32.2% (May 2007) have primary school education or lower and 25.8% have finished gymnasia and have no occupation. Their employability depends on significant investment in market relevant skills.
Very significant locational variations exist (see section 2.1.5 below).
2.1.3 Education, training and skills development At the time being, there is no analysis that would systematically examine the responsiveness of the education system to the labour market needs; it is however considered that a mismatch exists (As was mentioned earlier, at the end of 2006, 35.9% of all unemployed people had graduated from 3-year vocational schools.) Educational attainment levels of the Croatian working age population are generally below EU standards. In 2006, 18.2% of the employed, 20.6% of the unemployed and 55.5% of the inactive working age population had primary school education or lower10. Those with educational qualifications above secondary school levels constituted 19.7% of the employed, 11.2% of the unemployed and only 7.1% of the inactive (See Table 10). The most dominant form of educational attainment is persons with 3 or 4 year vocational schools. At the moment it is not possible to enter university from 3 year vocational schools. Higher, especially university education is not efficient, with a high drop out rate but the demand for this kind of educational services is high and outstrips supply although private sector provision has shown very fast growth. Illiteracy rates in Croatia are low, but the few years spent in education by a considerable proportion of the Croatian population suggest that further efforts will be required in Croatia to raise basic and overall skill levels. According to the 2001 census, 2.86% of the population had no schooling; 4.52% who had completed 1-3 grades at maximum, 11.24% who had completed only 4-7 grades and 21.75% who had completed basic school education.11 In comparison to the EU, Croatia has a considerably lower share of highly skilled workers in the total number of the employed. The share of highly skilled non-manual workers (including managers, professionals and technicians) in 2004 was 38.4 in the EU-27, but only 29.6 in Croatia – an 8.8 percentage point difference. Similarly, Croatia is also lagging behind the EU-27 regarding the share of tertiary (ISCED 5 and 6) education graduates in the population, even in younger generations but it is ahead of countries like Italy and the Czech Republic (see Table 10). That lag is likely to become smaller since the number of the tertiary-education graduates has been growing in the past several years. That number of graduates increased from 13,510 in 2000 to 18,190 in 2006 – a 34.6% growth. The growth was particularly high for women and their share increased from 55.6 to 59.7% of all graduates. There does however appear to be a significant problem with university drop-outs, especially of those who finished only general preparatory (gymnasium) education and therefore do not have useful job skills. For example, the ratio of graduates in 2005 to the enrolled (in the first year) in 2000, was less than 40%, implying a drop-out rate higher than 60%. The problem of drop-outs is expected to be even greater in the future due to large and growing enrolment at universities. For example, the total number of the enrolled went up from 91,874 in academic year 1998/1999 to 132,952 in 2005/2006 – a 44.7% increase in just seven years.
9 Croatian Employment Service. This data is based on annual average, not on the data recorded on 31st of December of given years. 10 Croatian Bureau of Statistics. LFS 2006/2 Release. 11 ETF calculations based on published census 2001 data, www.dzs.hr
31 Although Croatia has a relatively low share of highly skilled workers and a low share of highly educated population, it has a population well covered by secondary education, especially younger generations. The percentage of the adult population (25-64 years old) that has completed upper secondary education: 2005: EU27, 69.3%; Croatia 72.8% (Eurostat). This is similar to some recent Member States (such as Bulgaria and Romania) but lower than others (such as the Czech Republic, Slovakia and Slovenia). It is also higher than some older, more developed Member States (e.g. Belgium, France and the United Kingdom). However, the quality and adequacy of secondary (vocational) education in relation to the labour market needs requires further improvement. In almost all EU countries, as well as in Croatia, a higher level of education is related to a lower level of unemployment rate. In the EU-27, according to Eurostat, the unemployment rate for the secondary-level educated (aged 25-59) in 2006 amounted to 7.4% and for the tertiary-level educated 4.3%, while in Croatia those magnitudes were 12.3% and 7.1%, respectively (see Table 11). The highest unemployment rate was for those with the primary-level education – 11.3% in the EU-27 and 15 % in Croatia. Thus, the lack of education puts an individual at a serious disadvantage on the labour market both in Croatia and in the EU. The levels of provision of adult education and training, especially the application of life-long learning principle, are still significantly below those in the EU. Adult participation in education and training was only 2.3% in 2005 while the EU-27 rates for 2006 show levels around 9.6% of the population participating in any type of learning activity, which includes hobbies12. Overall, the Croatian population has relatively high rates of secondary education but low rates of higher education and the workforce has relatively low skill levels. There appears to be a significant mismatch between the contents of education (even vocational education) and the requirements of the labour market and very low levels of provision of adult education and training. However, more reliable information needs to be gathered on skills availability and needs.
2.1.4 Social protection, income and social inclusion According to Eurostat, the share of social security contributions and income tax in the total labour cost for a low wage worker in the EU-25 in 2004 was 36.4%. The share of social security contributions in the total labour cost in Croatia is 31.7% and income tax paid by a low wage worker is not high because of a large personal deduction. Since unemployment benefits in Croatia also seem to be modest, the present Croatian tax and benefit system does not create a serious “unemployment trap”. The income threshold for access to permanent social welfare in Croatia (about 53 euro per month for a working-age person) is determined by the government and is not related to any objective poverty line. Expenditures for all social welfare benefits account for about 0.64% of the GDP and they have increased compared to the year 2000 (by 0.59% of GDP). Regardless of the increase of expenditures for social welfare benefits they remain extremely low and are inadequate to meet minimum needs. In 2006 various forms of material social welfare covered about 5.7% of the population, while 2.5% of the population received permanent social welfare. Single households accounted for almost half of all households (49.14%) receiving permanent social welfare, which is considerably higher than their share is in the total number of households (20.8% by the 2001 census). Almost 30% of single persons and families receive social assistance benefit for 5 to 10 years, of whom 73.7% have no earnings outside the social welfare system. Unemployed persons account for about 46% of all permanent social assistance beneficiaries due to the large number of long-term unemployed and young people entering the labour market for the first time, who are not entitled to unemployment benefit. In 2003 and 2004, social protection expenditures accounted for about 23.5% of GDP (4.5% below the EU-25 average of 27.7% GDP in 2002 and 28% in 2003). Despite a significant decrease since 2001, Croatia still
12 It is likely that the very low rate of participation of the Croatia population in LLL activities is due to a misunderstanding of the question in the labour force survey since educational activities are usually associated with formal educational establishments.
32 has higher social expenditure than both the EU-10 and countries in South-East Europe (in 2003 this expenditure in Bulgaria and Romania was 17.6% and 16.1% of GDP, respectively). Despite receiving a relatively high share of GDP, the Croatian health system faces financial difficulties in its daily operations. Croatia is also obliged to meet the needs of war veterans and war victims (around 6% of social expenditure). According to the last review of the register, there are nearly half a million persons with recognized status of a homeland defender (war veteran). The number of war veterans who are registered as unemployed decreased significantly in the last several years. It dropped from 45,225 in 1997 to 26,771 in 2005 and to 24,721 in October 2006 which is an overall fall of 54.7%. The Croatian at-risk-of-poverty rate varied between 17 and 18% in the period 2001-2005. Six EU countries had a higher at-risk-of-poverty rate than Croatia in 2003 (Slovakia, Italy, Portugal, Ireland, Spain, Greece), while Britain and Estonia had approximately the same rate as Croatia (the average for EU-25 was 16%, and for EU-10 15%). Although income inequalities are often perceived as being high in Croatia, indicators (parallel Gini coefficients) for the year 2003 show them to be similar to the average in EU-15, EU-25 or EU-10. Among the EU-10 countries, only Slovenia, Hungary, Czech Republic and Cyprus had lower inequalities than Croatia while higher inequalities are found in the Baltic countries, Poland, Greece and Portugal. The at-risk-of- poverty rate for women (18.9%) is slightly higher than for men (15.9%) and poverty among the Roma is considerably more widespread than in other groups or society as a whole. Assuming the poverty line to be 60% of median per capita income, 76% of Roma and 20% of non-Roma living close to Roma settlements live in poverty. Certain groups of the population are particularly vulnerable to social exclusion. These include unqualified or low qualified or narrowly skilled people, young people with inappropriate education and/or without work experience, war veterans, disabled people and minorities. Croatia, in relation to other countries in the European Union, has far lager share of people with disabilities in the active working population (people with disabilities make 24.4% of all persons at the age between 15 and 64). Persons with disabilities continue to encounter barriers in accessing employment although the law guarantees them the right to professional rehabilitation and training for an appropriate job. At the end of 2004, 7,322 people with disabilities were registered as unemployed (2.3% of all the unemployed). In June 2007, the government adopted the new Strategy of Uniform Policy for People with Disabilities 2007 - 2015. Regarding professional rehabilitation, employment and work of people with disabilities, the first measure is to evaluate current legislation and policy in the field by an independent body. Under the Strategy 2007-2015 additional stress is given to defining different models of employment for people with disabilities who need support in access to the labour market as well as providing support measures during employment; providing mechanisms of protection against discrimination as well as raising the awareness of employers. Within the public domain, employment of people with disabilities in government bodies and the civil service is legally regulated on the quota basis so that these services should have 6% of people with disabilities employed by 2020. In terms of population and welfare, there are huge regional disparities in Croatia, indicated by a ratio of 17:1 between the most and least densely populated counties and a ratio of 55:1 for GDP levels (see also following section). Registered unemployed rates vary significantly between counties, ranging from 13% to 40%, with particularly high rates in regions bordering Croatia’s eastern and southern neighbour countries (war affected areas). The highest poverty rates are in the counties of Karlovac and Sisak-Moslavina, and the lowest in Zagreb City, Primorje-Gorski Kotar and Istria. The number of permanent social assistance beneficiaries is above average in the areas affected by the war (e.g. in Šibenik-Knin county the number of permanent social assistance beneficiaries is three times higher than the average). The only county with an above-average number of beneficiaries and not affected by the war is Međimurje, where there is a great concentration of Roma. Rural areas suffer from a declining and ageing population, as well as lower skill levels of their population. 2001 census data show that the percentage of population older than 15 years of age without any education in some rural areas is 3-4 times higher than a respective ratio in urban areas of the same county.
33 Overall, Croatia still needs to modernise its health and social welfare systems and to further promote social inclusion. Besides ethnic minorities, the most visible marginalised group appears to be the disabled. Moreover, certain individuals and groups can be the subject of multiple disadvantages. This means that the operations supported by this OP will either need to be targeted on specific disadvantages or be sufficiently flexible to allow the targeting of disadvantage of different types. As is the case with education and employment, significant locational variations persist in relation to the provision of social and health services. However, the issue of social inclusion arguably is also, and importantly, related to employment. In line with programming principles for the Structural Funds, we therefore propose to concentrate the activities supported through this OP to promote social inclusion on assisting disadvantaged groups to gain access to employment and education for employment. The provision of accurate and up to date data on those at risk of social exclusion also needs to be promoted.
2.1.5 Regional disparities Map 1. County (regional) self-government units in Croatia
In administrative terms, Croatia is organised into 21 counties (the City of Zagreb has the dual status of a county and a city), another 126 cities and 429 municipalities which are growing in number. Analysing socio-economic indicators, it is possible to observe considerable disparities among Croatian counties. (i) Comparison of the basic economic indicator GDP per capita (in current prices) on county level (see Table 12) shows that in 2004 just a few counties exceeded the Croatian average GDP (e.g. City of Zagreb, County of Istria, Lika-Senj County and County of Primorje-Gorski Kotar). According to the latest available data, compared to the average EU-25 GDP per capita, the level of GDP p/c ranges from 81% of the EU level in case of the City of Zagreb, to 26% in the Vukovar-Srijem and the Brod-Posavina County.
34 (ii) In terms of demographic trends, Croatia is characterised by a concentration of population in a few macro-regional and regional centres (see Table 12). The highest population density is in the City of Zagreb, 7.5 times higher than the county which comes second (Međimurje) and 15.5 times higher than the Croatian average (78.4 inhabitants/km2). With the exception of the City of Zagreb, the ratio of population density between the least populated county (Lika-Senj) and most populated county (Međimurje) is 1:16.2. Furthermore, a trend of rural-urban divide is characterised by a growing concentration of population in Zagreb and a few other macro regional and regional centres and narrow coastal areas, while other regions of Croatia are being intensively depopulated. Because of their relatively high number, a great number of counties and municipalities in Croatia face the problem of ineffective policy delivery and lack of development funds due to their small tax base (number of inhabitants) on which many of these units are reliant upon for local income. As a consequence, the local and regional self-government – and the assisted areas in particular – greatly rely on financial transfers and state aid from the national budget.13 (iii) Data on the level of educational attainment, which represents a significant factor for regional development, additionally reveal the level of disparities within the country. Whereas the Croatian labour force is relatively well educated and trained, very significant disparities exist at the level of counties. The latest census shows that the City of Zagreb has the highest proportion of inhabitants with higher education compared to total population (16.8%); it attracts almost twice as many highly educated people than any other County. According to some preliminary CBS estimates from end March 2006, educational attainment of the employed persons in legal entities in Croatian counties also show a substantial level of regional disparities i.e. the City of Zagreb has the highest share of the employed persons with the graduate or postgraduate education (ISCED 97-5a and 6) in the total number of the employed -22.63%, which is 8.21 percentage points higher than the county which comes out second (County of Primorje-Gorski Kotar with 14.42%). They are followed by County of Virovitica-Podravina (7.54%) and County of Bjelovar-Bilogora (7.96%). (iv) The unemployment rate across Counties differs significantly. The range lies between the City of Zagreb (9.2%) and the County of Istria (8.4%) with the lowest administrative unemployment rates on one side, and the County of Vukovar-Srijem (31.3%) with the highest unemployment rate on the other side (See Table 12, data from end March 2006, CBC). Croatia’s division into NUTS II regions is shown below (Map 2).The most significant problems at the NUTS II level are faced within the Central and East (Panonian) Croatia region, which has experienced severe war damage and the decline of state-owned enterprises located in the ASSC. This region contains three of the four most war-damaged counties (Vukovar-Srijem, Sisak-Moslavina, and Osijek-Baranja) and Areas of Special State Concern cover about 80% of its territory. • Central and East (Panonian) Croatia (Counties (8): Bjelovar-Bilogora, Virovitica-Podravina, Požega- Slavonia, Brod-Posavina, Osijek-Baranja, Vukovar-Srijem, Karlovac, Sisak-Moslavina County) • Adriatic Croatia (Counties (7): Primorje-Gorski Kotar, Lika-Senj, Zadar, Šibenik-Knin, Split-Dalmatia, Istria, Dubrovnik-Neretva County) • North-West Croatia (Counties (6): Zagreb, Krapina-Zagorje, Varaždin, Koprivnica-Križevci, Međimurje County and City of Zagreb)
13 The situation should improve over time, as the process of fiscal decentralization continues and comes to mirror the scope of policy decentralization and as inter-county and inter-municipality cooperation on development projects and service supply is encouraged).
35 Map 2. NUTS II regions in Croatia.
36 2.2 SWOT analysis
Strengths (internal/current) Weaknesses (internal/current) Employment Employment Growing registered employment particularly in Demographic indicators detrimental to growth of SME and business services sectors. working-age population in the long-run No significant disincentive effects from Low workforce participation rate and consequently unemployment benefits or taxation low employment rate. IT infrastructure for mediation and other types of High unemployment, particularly among the young. LM information in place in the CES High long-term unemployment, especially amongst Private sector in mediation strong and developing women. Unemployment rate falling, especially among the Low regional mobility of labour force. young Informal economy gives rise to insecure and The informal economy is a buffer for poverty flexible work arrangements Regional differences considerable Education and Training Education and training Recently increased funding for education including VET curricula inflexible and not sufficiently linked to vocational education. labour demand. Inadequacy of statistical Broad political consensus on common European information on educational performance. goals in education and training. Life-long education and training neglected as a part New institutions recently established to support of education system. reform and build on existing strengths. Lack of single legal framework for the entire Some strong faculties and scientific organizations. system of education. Increasing research programs & fellowships for Inadequate basic infrastructure in education – young researchers particularly in certain locations High coverage by secondary education especially Underdeveloped teacher training system. among the young High levels of university drop-out rates Low drop-out rate from secondary school Key competences missing from educational outcomes in formal education Few links between the economy and education Social inclusion Social inclusion Growing number of tertiary-level female graduates. Low workforce participation rate and consequently Income inequalities generally close to EU levels low employment rate of older people and women. Solidarity of family and social networks still strong High youth unemployment. Increasing female at-risk-of-poverty rates especially among older women. Poverty concentrated in war-affected areas and among the Roma minority Social security benefits (unemployment and welfare) are too low and there is little income security Inadequate cooperation between labour and welfare institutions
37
Opportunities (external / future) Threats (external/ future) Employment Employment Further economic reforms could increase labour Further industrial re-structuring may reduce demand in the long run. employment in the short run. Enhanced entrepreneurship could contribute to job- Workforce might prove resistant to adequately creation. improving its skills Reformed VET could allow the Croatian workforce Brain drain. to adopt new and more competitive Ageing population could lead to the decrease in technologies/practices working age population rising share of older Some of the rising mobility of highly educated EU workers students and workforce could be captured Failure to make formal sector work related The traditional positive immigration balance may legislature more flexible serve to reduce labour shortages in the medium Social benefits increasingly hinge on term unemployment status. Capacity for policy development and implementation, monitoring and evaluation remains weak Education and training Education and training Rising demand for education services especially at Policy design may be hindered by inadequate data the tertiary level and implementation hindered by weak action plans. Further increase in public financial resources to Low priority given to employee training support education Capacity for policy development, implementation, Increased private sector participation and support. monitoring and evaluation remains weak Implementation of recently adopted strategies New institutions (AVET, ALL, ETTA) could develop inter-linkages at an early date for building synergies in policy development and research Social inclusion Social inclusion Active labour market measures (e.g. re-training) Aging population puts pressure on social security could enhance the employability of the system. disadvantaged groups Inadequate measures taken to counter youth Rising activity of the civil sector especially at the unemployment regional level could have a bearing on Capacity for policy development, implementation, strengthening social inclusion monitoring and evaluation remains weak
On the basis of the above analyses, the underlying strategic approach set out under section 2.3 hereunder places a strong focus on institutional and capacity building which concentrates on a limited number of priorities and measures identified by their strategic relevance to the promotion of socio-economic cohesion in line with Community and national policies. At the same time, the strategy set out under this Operational Programme seeks to establish component IV as the 'pre-cursor' towards the progressive development of effective preparations for the future management and implementation of future ESF assistance.
38 2.3 Strategic priorities
2.3.1 Introduction In 're-launching' the Lisbon strategy, the European Council endorsed a single set of Guidelines which brought together the Broad Economic Policy Guidelines as well as the Guidelines of the European Employment Strategy thereby integrating the macro, micro and employment policies for growth and jobs. In the sphere of employment and human resources in particular, the priorities set out under the Community Strategic Guidelines on cohesion (CSGs) have as their source those of the European Employment Strategy (EES). As highlighted in the CSGs, the drive for full employment and higher productivity depends on a wide variety of actions. Indeed, as an illustration, investment in infrastructure, combined with business development and research, will normally improve job opportunities both in the short run (as a result of 'first-round' effects) and in the longer run as a result of their positive effect on competitiveness. However, in order to maximise the employment effects from such investment, human capital must be further developed and enhanced. To this end, the Employment Guidelines highlight 3 priorities in particular in the context of promoting 'more and better jobs' : • Attract and retain more people in employment and modernise social protection systems • Improve adaptability of workers and enterprises as well as flexibility of labour markets, and • Increase investment in human capital through better education and skills. In line with these priorities, appropriate focus will also be given to investments, which improve the efficiency and effectiveness of public administration. Deriving its 'guidance' from the EES priorities outlined above, the Strategic Coherence Framework sets out the 'strategic direction' for this operational programme as described in section 1.2.2 above. In practical terms, this approach will form the cornerstone of Croatia's human capital development over the shorter-term duration of the OP as well as representing a 'platform' for the longer term perspectives identified under future ESF assistance. While recognising that the setting of OP priorities at strategic level will involve policy inter-action across the employment, education and training and social inclusion fields, the strategic priorities identified in this Section are designed to provide a clear focus on what can be achieved over the duration of the programme and which can be further developed under the next-generation ESF. In relation to administrative capacity, the strategic priority will likewise focus on what is attainable under the programme that can be further strengthened under ESF post accession.
2.3.2 Employment Building on the existing capacity developed under CARDS and Phare pre-accession funding, the overriding strategic priority in the sphere of employment remains one of strengthening and modernising the Croatian Employment Service (CES). As the key instrumentation in building an efficient and effective labour market institutional set up, the CES must develop the strategic capacity to respond to the challenges of rapid socio-economic restructuring and demographic ageing. In this context, the CES must strengthen its support service and delivery to job seekers as well as to the unemployed and disadvantaged. To this end, its role in providing effective mediation, vocational guidance and implementing active labour market policies will remain pivotal for promoting occupational and geographical mobility at both the national and local levels.
39 At the same time, such an approach should facilitate the development of more effective anticipatory mechanisms in addressing skills shortages while alleviating bottlenecks across the sectors and/or occupations concerned. In setting these strategic priorities for the CES, there remains the wider recognition of the need to strengthen the 'interface' between its functions in administering unemployment benefits and assistance on the one hand and its role in brokering a more effective response to the requirements of the labour market on the other. In parallel with the modernisation of the CES, and in the light the continuing low employment and activity rates, the promotion of active labour market policies will remain a key strategic priority over the duration of the programme and beyond into future ESF. At the same time, as highlighted in section 2.3.1 above, such policies must be accompanied by appropriate 'demand-led' measures if they are to be rendered effective from a supply side perspective. While employment subsidies will continue to play a role in the promotion of active labour market policies, the underlying strategic policy direction under the programme will gradually shift the focus towards better evaluated and targeted measures incorporating higher quality formal training and skills input.
2.3.3 Education, training and skills development Supporting the development of reforms in education and training systems is also a key strategic priority of this operational programme. In particular, the need to ensure an adequate supply of attractive, accessible and high-quality education and training provision at all levels (including flexible learning pathways) will be complemented by measures to reduce the incidence of a high drop-out rate from tertiary education in order to achieve more efficient education outcomes. However, in view of the limitations on the levels of assistance available under component IV, the OP strategic priorities set out below have been adjusted and presented in a manner that will facilitate their further development and elaboration under future ESF assistance. In the area of VET reform, a key strategic priority will be the establishment of a national CROQF Working Group in order to ensure a coherent follow-up to the Green and White Papers and its focus on the development of a range of key elements forming a strategy for life-long learning. In particular, there is a need to develop a comprehensive Croatian Qualifications Framework (CROQF) which is compatible with the European Qualifications Framework and based on the achievement of HRD goals linked to the needs of the labour market as well as to national and regional economic development strategies. As an integral part of this national framework, occupations and qualifications will be linked to the parallel identification of economic branches and related skills profiling. Competence (output) based qualifications as well as strengthened certification standards will also form a cornerstone of the framework. Since Croatia has very low adult learning participation levels in comparison to EU-27, the need to address this structural weakness represents an additional strategic priority for the programme to be further developed under future ESF assistance. In particular, new legislative, institutional and delivery standards for Adult learning provision will be accorded strategic focus in the formulation of a new and more comprehensive approach to the development of life-long learning.
2.3.4 Social inclusion As an integral part of promoting a more sustainable and inclusive approach to labour market integration, the key strategic priority will be to ensure greater access for people at a disadvantage or at risk of social exclusion. In particular, the strategic focus of the interventions will be on the specific problems of the long- term unemployed with low levels of qualifications and skills as well as minority groups and people with disabilities. Underpinning this approach will be the need to develop a broader range of support to building pathways to labour market integration while combating discrimination. Strengthening care and support structures in the labour market will also form part of the approach including the development of the secondary labour market (social economy) where appropriate. This approach has the added value of itself for promoting economic development.
40 As in the case of employment and education and training provision, the strategic priority set for social inclusion will be further elaborated and built on in the framework of future ESF assistance.
2.3.5 Administrative capacity In view of the broader strategic role accorded to the future ESF in promoting a more efficient and effective public administration, it is acknowledged that a wider and more significant contribution to the reform process will take place when higher levels of assistance become available to Croatia after accession. Indeed, setting this wider ESF remit in context, the overriding objective will be to strengthen public policy and capacity with a view to ensuring effective management of the socio-economic factors which contribute to a more competitive and inclusive society. Within the perspective of the OP itself, the strategic focus has been framed in line with the scope and funding limitations of component IV. In particular, the key underlying strategic priority will be to strengthen capacity and promote good governance in the employment, education and training and social inclusion fields. As outlined above, the modernisation of the CES remains an on-going strategic priority while the strengthening of the Croatian Qualifications Framework is also highlighted (ref. section 2.3.3 above). While the scope of component IV incorporates institutional capacity building at national, regional and local level, the strategic focus will be to ensure that capacity at central level is strengthened during the initial phases of the process.
41 3. PROGRAMME STRATEGY
3.1 Concentration of assistance - priority axes and measures
Within the overall aim of ensuring that the relevant institutions of the Republic of Croatia achieve readiness for EU membership and develop institutional capacity and practical experience with the management of European Social Fund - type interventions, the following framework objective is established under IPA Component IV in Croatia - To create more and better jobs. More immediately, to attract and retain more people in employment by increasing human capital investment, reinforcing social inclusion and promoting adaptability of enterprises and workers. An account of the rationale and specific objectives for each Priority Axis of this Operational Programme is provided hereunder together with a short description of the type of activities that they may support. In the following Section (3.2), further detail is provided on the Measures established as the means to achieving each of the Priority Axes, including information on the implementation mechanisms employed including the selection criteria and targets/expected outputs. While a priority axis on Improving adaptability of enterprises and workers will not be addressed directly during the initial phase of the programme's implementation, it will nevertheless remain an integral part of the key strategic policy framework within which employment and HRD-related priorities will be established both under component IV as well as under future ESF assistance. In order, however, to provide the necessary foundations for developing appropriate measures under the afore-mentioned priority axis, technical assistance under priority axis 4 will be used for capacity building purposes (see also section 1.2.1 above and section 4.1 hereunder). Priority Axis 1 – Enhancing access to employment and sustainable inclusion in the labour market Rationale While the Croatian Employment Service has progressively developed more effective delivery of employment and training measures, the results (whether funded entirely through Croatian sources or with EU assistance) have been 'mixed' in that resources and capacity remain relatively weak in comparison to the challenges to be met. Based on the analysis provided in Chapter 2, Croatia’s SDF and other relevant national policies all identify the need to improve the functioning of the labour market as an important priority, as do relevant EU agreements and guidelines. To this end, enhanced mainstream and targeted active and preventative labour market measures that build on improved partnership arrangements have been identified as a requirement for the consolidation of an effective Croatian labour market. As an integral function of developing a more effective labour market, the policy focus under this priority axis will also seek to promote the design and dissemination of innovative and more productive forms of work organisation under the provisions of Article 151.2(a)(ii) of Commission Regulation (EC) No 718/2007. To this end, the promotion of health and safety at work will be accorded particular focus in line with future structural fund requirements under the ESF (for its part, component I will focus on upgrading the legislative provision, as well as strengthening the institutional framework for the health and safety at work. Specific Objectives To reduce existing unemployment and the 'threat' of new unemployment and also promote the reintegration of the unemployed by supporting the design and implementation of both active and passive labour market measures that target the specific conditions of the Croatian labour market and build on previous experience and best practice. To support the development of the capacity of Croatia’s public institutions and relevant non-government partners in the employment field.
42 Description Labour market policies should improve the employability of the unemployed and the inactive and provide services and training to support their participation in the labour market, and also improve the competitiveness of the workforce. To this end, the provision of targeted training programmes that develop the specific types of knowledge and skills required by the labour market will be promoted while support will be provided to the Croatian Employment Service to enhance the range and content of training and counselling services which better respond to the particular demands of the Croatian economy. In developing such services, the CES should help establish and build on developing partnerships between the institution itself and representatives of business and labour at the regional and local (multi-county) level. Within the context of the economic 'demands' arising from the accession process, Croatia’s public services in the employment field will require substantial strengthening. This priority will also, therefore, support the development of institutional capacity of public bodies at the central and local level in the field of employment including in particular strategy design, programme implementation, programme monitoring and evaluation, and legislative reform. It will also support cooperation with partners from non-governmental sectors (business associations, trade unions, civil society organisations). Under this Priority Axis, it is proposed to concentrate, in the initial phase, on assisting the strengthening of core labour market measures including mediation, vocational guidance and delivery of training and active labour market policies, especially activation building on the experience of recent EU supported projects such as the CARDS 2004 Local partnerships for Employment – Phase 2 project. Priority Axis 2 – Reinforcing social inclusion and integration of people at a disadvantage Rationale Analysis of the Croatian context (see Chapter 2) indicates that particular groups such as the long-term unemployed and inactive, unemployed youth, women, older unemployed, disabled, Roma, minority groups, and those located in lagging-behind regions face significant obstacles to participation in employment in Croatia. Such obstacles are not only a barrier to genuine social cohesion, they also reduce the effectiveness and efficiency of the labour market. Specific Objectives To increase the employability of disadvantaged persons and assist their access to the labour market. Description This priority axis will support measures and promote the integration of disadvantaged groups into the labour market. Although not in the initial phase of the programme, assistance will also be provided to strengthen access to education within the 'pathways' approach to labour market integration. Under this priority axis, the disadvantaged will be assisted through relevant education and training provision as well as the creation of support networks and improved support services to enhance their overall employability. Priority Axis 3 – Enhancing human capital and employability Rationale Despite a wide and ambitious range of recent initiatives, Croatia still faces challenges in delivering education and training that prepares and qualifies people for employment. Effective educational and training systems that are responsive to labour market needs are crucial for the development of the knowledge-based economy and to increasing levels of employment. Moreover, education should also ensure that students are equipped with the skills and competencies that provide a foundation for lifelong learning that is of central importance in improving the competitiveness of the workforce. This priority axis will accordingly also support the development of institutional capacity of public bodies at the central and local level in the field of VET for strategy design, programme implementation, programme monitoring and evaluation, legislative reform, and consolidation of the initiatives that have been taken in recent years. In addition, it will support cooperation with partners from both government and non- governmental sectors (business associations, trade unions, civil society organisations).
43 Specific Objectives To strengthen investment in human capital in Croatia and promote greater employability by helping Croatia develop and implement a coherent HRD policy and national qualifications framework and increase the overall labour market relevance, efficiency and quality of the education and training systems. To support the development of the capacity of Croatia’s public institutions and relevant non-government partners in the vocational education and training field and in the field of adult education. Description Within the wider policy framework of preparations for future ESF, this priority axis will progressively focus on the establishment of closer links between the academic sector and enterprises both in regard to equipping students with skills that will better prepare them for the world of work and to carrying out research that promotes economic and social development likely to attract external funding support. Also within this framework, it will improve the labour-market relevance of initial and vocational education and training. The implementation of life-long learning principles and practice will be supported and, within that context, assistance will be provided under this priority axis to support continuing adult education and training. In addition, this priority will support the establishment of a national network for the recognition of professional qualifications (Croatian qualifications framework) in line with the EU requirements. Priority Axis 4 – Technical assistance Rationale The IPA Implementing Regulation identifies a number of areas and forms of assistance for Component IV, including, in particular Article 151.2(f) - strengthening institutional capacity and the efficiency of public administrations and public services at national, regional and local level and, where relevant, the social partners and non-governmental organisations with a view to reforms and good governance in the employment, education and training, as well as social fields. However, while specific capacity-building activities to this end have been incorporated under all 3 operational Priority Axes, Priority Axis 4 will focus its support on project pipeline development and programme capacity activities directly related to the delivery of the HRDOP as specified under Article 151.3 (i.e. to support the preparatory, management, monitoring, administrative support, information, evaluation and control activities of the programme, and preparatory activities with a view to the future management of European Structural Funds). Building on the use of pre-accession assistance, Croatian programme and project management capacity – from design through to commissioning and operation – is evolving at the national, regional and local levels, supported in recent years by 76 technical assistance and twinning projects under PHARE, CARDS and bilateral assistance. This practical experience will continue to grow and become embedded in future years, as more projects and operations come 'on-stream'. Management of IPA component IV specifically relates to this OP and will involve additional expenditure which does not form part of the Croatian administration’s traditional operating expenses (e.g. information and publicity; the development of monitoring indicators and an EU funds Management Information System as well as the commissioning of external, independent experts for interim and ongoing evaluations). Accordingly, Component IV will be designed as a 'pre-cursor' towards the future European Social Fund with a focus on developing the required capacity to manage and implement assistance under the Fund's rules and requirements. As an integral part of this approach, priority will be accorded towards building sustainable institutional structures and developing systems support structures for the transition to Structural Funds. Furthermore, the preparation of sufficient, well-designed and mature project proposals will ensure use of EU assistance in a timely and technically feasible manner.
44 Specific objectives To ensure efficient and effective OP management and develop the institutional capacity for managing and absorbing IPA allocations to the HRD OP. To support the generation of a 'project pipeline' to ensure sufficient projects come 'on stream' in a timely manner and are fully mature and ready for submission to the Project Selection Committee in each year of the programme. Description Four types of operations will be supported under this Priority Axis: Specific, tailored support to coordination and management of the OP, including programming, information and publicity, project appraisal and selection, implementation, financial management, control, monitoring, evaluation, reporting and audit; Aid to enhance the specification, collection and use of statistical data which will be necessary for effective monitoring and evaluation under IPA component IV and, subsequently, the ESF; Sectoral assistance to strengthen the capabilities of potential beneficiaries, including the generation of project ideas and their ultimate elaboration into viable, eligible and high quality proposals. Consultancy support (including advice and training) to the OP Operating Structure, regarding any aspect of management, monitoring, evaluation and control, including grant scheme management and procurement (e.g. fees for expert assessors and evaluators of project applications). Measures Detailed information on each measure proposed for support through this Operational Programme is presented hereunder in tabular format including information on: • Measure description • Specific objectives • Main types of operations • Target groups • Head of Operating Structure • Specific bodies under Operating Structure (Articles 28.1 and 31 of the IPA Implementing Regulation) • Final beneficiaries • State aid [Art 28.2(d) of the IPA Implementing Regulation] • Output and result indicators • Selection modalities and specific related criteria Types of support In line with the nature and scope of each type of operation, the types of support will be adapted to ensure the most effective implementation and delivery mechanisms towards achieving the specific measure-level objectives set. Such mechanisms will include, inter alia, an appropriate mix of Grant Schemes and Operating Grants and will adhere to the principles for tendering procedures and grant awards laid down in the Financial Regulation (as revised under Council Regulation 1995/2006 of 13 December 2006) in respect of external actions. State Aid The Head of the Operating Structure will be responsible for ensuring that operations are selected for funding and approved in accordance with the criteria and mechanisms applicable to the programmes, and that they comply with the relevant Community and national rules including those related to state aid and competition policy.
45
Priority Axis 1 – Enhancing access to employment and sustainable inclusion in the labour market
Title of Measure Measure 1.1. Supporting the design and implementation of active and preventative labour market policy. Description Assistance under this measure will be directly allocated to support and develop the active and preventative labour market programmes implemented by the public employment services in Croatia. These programmes should target both the unemployed and those facing the likelihood of unemployment. It will also promote the development of partnerships between public employment services, local authorities and other public bodies in the field of education, labour market and regional development as well as representatives of business, labour (social partners) and the community in the design and delivery of employment activities. The development of HRD strategies at the county / cross-county level and their regular revision is to provide a basis for more targeted project partnerships and pipelines and develop local capacities to make effective use of ESF and other funding. While Local Employment Partnerships have a valuable role to play across Croatia’s national territory, particular care will be taken under this measure to ensure their coverage of the lagging-behind regions (see section 2.1.5). Specific objectives To develop a participatory institutional framework with a regional focus for the promotion of employment Main types of operations Indicative operations under this measure will focus on developing partnerships for employment at the county and inter-county level to: • carry out labour market analyses; • elaborate local HRD strategies; • undertake local employment initiatives; • Develop project generation and articulation facilities within the CES at the regional level, and • Implement grant schemes in line with the HRD OP objectives and strategy Target groups The unemployed (particularly those located in lagging-behind regions). Those facing the threat of unemployment. Within this cohort, those lacking skills for which there is a demand as well as those working in declining industries or industries undergoing re-structuring, will form the main focus. Those on short-term contracts will also be targeted.
46
Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure Specific bodies under The Croatian Employment service (CES) as Implementing Body. Operating Structure (Art The Head of the Operating Structure will establish a Sectoral Monitoring 31 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries Final beneficiaries shall be regional employment offices and local (county) partnerships for employment. Selection modalities and Appraisal and selection will be performed by Selection Committees at two specific related criteria levels: • Project Selection Committees – these will consider any applications for funding from grant schemes, and will be chaired by CES as Implementing Body; • Tender Selection Committees – these will select contractors for works, supply and/or service contracts, which are put out to tender under EU procurement rules, and will be chaired by the CES as Implementing Body. Project selection criteria shall include: • Potential for placing the unemployed and those at risk of unemployment in sustainable jobs; • Degree of involvement of partners (from the public, non-profit and private sectors) in both the management and financing of the activity; • Financial efficiency, including costs per unit output; • Orientation towards the specific requirements of qualification (re- qualification); • Degree of sensitivity to specific HRD/labour market needs and appropriate strategies at the county and multi-county level; • Orientation towards regional inequalities in access to education and training, as well as employment.
47 The project selection process will take appropriate account of the regional disparities in employment and unemployment rates to ensure that the needs of under-performing regions in this regard are effectively addressed.
Title of Measure Measure 1.2. Supporting the effectiveness and quality of Croatia's public employment services. Description Croatia’s public employment services will need further modernisation if it is to meet the challenges of EU accession. Although many elements of an effective policy framework are in place, both the Labour Directorate of Ministry of Economy, Labour and Entrepreneurship (MELE) and Croatian Employment Service (CES) need to acquire substantially more professional capacity, in relation to: (i) accelerated harmonisation with EU labour legislation and standards of the public employment services in the EU member states; (ii) absorption capacity for managing funds from IPA Component IV in Croatia’s run-up to accession and corresponding effective regional structures in order to monitor and evaluate relevant HRD measures; (iii) efficient implementation of the National Reform Programmes and Integrated Annual Employment Action Plans. This measure will focus on supporting the further development of both the MELE and the CES (on both the national and local levels). Specific objectives To improve the quality, effectiveness and efficiency of Croatian public employment services. Main types of operations Indicative operations under this measure include: • Development of the capacity to formulate a coherent legislative framework for lifelong career guidance provision. • Support the work of a future National Forum for Lifelong career guidance. • Establishment of a pilot lifelong career guidance centre in partnership with relevant business support services • Establish a training facility within CES for key skills for counsellors (focusing on the unemployed), advisors (focusing on the employers), lifelong career guidance counsellors, specialised councillors for disadvantaged groups and skills for other CES processes. • Strengthen the analytical capacity of CES and MELE and introduce links with the academic community to develop policy oriented research • Design and implementation of a comprehensive information strategy for CES that takes account of the evolving requirements of the European Employment Strategy and respective integrated guidelines • Support design and implementation of improved business processes with the CES’s IT system and user-friendly IT solutions, including upgrading of the IT equipment & software • Create a system of quality assurance, monitoring, evaluation and training-needs assessment for CES business processes. Target groups The Croatian Employment Service at both national and local level. The relevant departments of MELE.
48 Agency for VET. Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE) Structure Specific bodies under The CES as Implementing Body. Operating Structure (Art The Head of the Operating Structure will establish a Sectoral Monitoring 31 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries The Croatian Employment Service at both national and local level. The relevant departments of MELE Agency for VET (AVET). Selection modalities and Appraisal and selection will be performed by Selection Committees at two specific related criteria levels: • Project Selection Committees – these will consider any applications for funding from grant schemes, and will be chaired by CES as Implementing Body; • Tender Selection Committees – these will select contractors for works, supply and/or service contracts, which are put out to tender under EU procurement rules, and will be chaired by the CES as Implementing Body. Selection criteria shall include: • A clear demonstration between the relationship of the project with the requirements of the European Employment Strategy. • Orientation towards efficient implementation of National Action Plans for Employment; • Orientation towards upgrading capacity building activities carried out within the framework of the Phare 2005 Labour Market project. The project selection process will take appropriate account of the regional disparities in employment and unemployment rates to ensure that the needs of under-performing regions in this regard are effectively addressed.
49 Priority Axis 2 – Reinforcing social inclusion of people at a disadvantage
Title of Measure Measure 2.1. Supporting access to employment by disadvantaged groups. Description Supporting integration into the labour market by those groups that experience particular difficulties in accessing employment will incorporate a number of elements including: strengthening motivation to take part in education and employment programmes; providing psychological and social support services as well as personal development and training programmes adjusted to individual needs. Support will build in the engagement of both employment and social services operating in an integrated fashion and will be targeted on, and customised to, identified specific needs. It will also be delivered in close partnership with local actors. Specific objectives To promote the social inclusion of disadvantaged groups through their integration to the labour market. Main types of operations Indicative operations under this measure will include: • Development of new inter-institutional models and inter-sectoral business solutions for work with disadvantaged groups; • Training of staff (basic and advanced) in the employment and social welfare services for work with disadvantaged groups; • Training and retraining of disadvantaged groups; • Establishing a network of 'Mentors for Social Integration' (MfSI) in the private sector and civil society organizations including provision of institutional arrangements for its effective functioning; • Implementation of grant schemes supporting work placements and other relevant services to the disadvantaged by both public institutions and non-governmental/non-profit organizations. Target groups Disadvantaged groups of the unemployed; these may include: • persons with disabilities • those with low levels of educational attainment • youth unemployed; • older and long-term unemployed • women, • people living in less developed regions, • minority groups. Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In discharging its responsibilities and delegating tasks in relation to this measure, the MELE will work closely with the Ministry of Health and Social Welfare (MHSW), through operational agreements, which will be subject to the accreditation process. Specific bodies under The CES as Implementing Body. Operating Structure (Art 31 The Head of the Operating Structure will establish a Sectoral Monitoring
50 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries Final beneficiaries shall be the Ministry of Health & Social Welfare, Counties- Social Welfare Units, Centres for Social Welfare and the Croatian Employment Service (central and regional employment offices). Eligible applicants/partners for grants shall include: Non-profit NGOs, private/public institutions operating at the regional/local level; regional/municipal development agencies and SME support centres / technological incubators. Selection modalities and Appraisal and selection will be performed by Selection Committees at two specific related criteria levels: • Project Selection Committees – these will consider applications for grant support, and will be chaired by CES as Implementing Body; • Tender Selection Committees – these will select contractors for works, supply and/or service contracts, which are put out to tender under EU procurement rules, and will be chaired by the CES as Implementing Body. Project selection criteria shall include: • The creation of new jobs for those in danger of social exclusion (including in particular the target groups referred to above) or the retention of existing ones; • A clear demonstration of the relationship between the project and requirements of the social integration of specific groups in line with the best-practice examples (including previous initiatives within the framework of the EQUAL programme); • The involvement of the public, non-profit and private sectors; • Financial efficiency, including costs per unit output; • Orientation towards comprehensive approaches to treating unemployment among specific socially excluded groups (including specialised rehabilitative, psycho-social and job-market oriented services); • Orientation towards setting up various models of social employment
51 planning on regional/local level, based on periodic participatory needs assessment in the field of community and care services. • Orientation towards the specific requirements of qualification and re- qualification; • Orientation towards regional inequalities in access to education and training, as well as employment. Project selection process will take appropriate account of the regional disparities with respect to employment of socially excluded persons to ensure that the needs of the regions faced with high unemployment rates are effectively addressed.
Title of Measure Measure 2.2. Supporting access to education by disadvantaged groups. Description This measure is intended to promote equal opportunities in access to education by the development and introduction of inclusive educational and teaching methods, and by promoting the elimination of segregation and discriminatory practices. The measure will also seek to promote greater educational attainment (by activities targeted on reducing school-failure and drop-outs) and also improve the labour-market prospects and social integration of the disadvantaged and those with special educational needs. Specific objectives To support access to education for employment by disadvantaged groups through, inter alia, promoting a more flexible policy framework and innovative provision of relevant services. Main types of operations • Supporting the design and implementation of educational programmes specifically targeted on disadvantaged groups (including upgrading facilities and equipment where appropriate). • Building the capacity of education professionals in new services for the disadvantaged, primarily in the VET sector Target groups Those facing disadvantage in access to or within education including those with special educational needs (including primary and secondary school drop-outs, those in lagging-behind regions, persons with disabilities and minorities). Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In fulfilling its responsibilities and delegating tasks in relation to this measure, the MELE will work closely with the Ministry of Science Education and Sport (MSES), through operational agreements, which will be subject to the accreditation process. Specific bodies under The AVET as Implementing Body. Operating Structure (Art The Head of the Operating Structure will establish a Sectoral Monitoring 31 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic
52 partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries The Ministry of Science, Education and Sports (MSES) as the key institution at national level, responsible for overall policy and co-ordination of reform activities in the field of education; Secondary schools, teacher training colleges, the Agency for Adult Education (AAE); the Agency for Vocational Education and Training (AVET); Youth organizations. Selection modalities and Appraisal and selection will be performed by Selection Committees at two specific related criteria levels: • Project Selection Committees – these will consider applications for grant support, and will be chaired by AVET as Implementing Body; • Tender Selection Committees – these will select contractors for works, supply and/or service contracts, which are put out to tender under EU procurement rules, and will be chaired by AVET as Implementing Body. Project selection criteria shall include: • A clear demonstration of the relationship between the project and requirements of the social integration of specific groups in line with the best-practice examples (including previous initiatives within the framework of the EQUAL programme); • Orientation towards the specific requirements of qualification and re- qualification; • Orientation towards regional inequalities in access to education and training. Project selection process will take appropriate account of the regional disparities to ensure that the needs of the regions faced with high unemployment rates are effectively addressed.
Priority Axis 3 – Enhancing human capital and employability.
Title of Measure Measure 3.1. Further development of the Croatian Qualifications Framework. Description The development of the Croatian Qualifications Framework (CROQF) will be designed to:
• establish benchmarks for the comparability of competences • encourage Lifelong Learning and especially prior learning and non- formal and informal learning • promote labour mobility
53 • promote high quality employability Pursuant to laying the groundwork for establishing the complete CROQF (basic concepts, CROQF Committee, initial proposal for a number of levels/sub-levels) and its eventual adoption (envisaged by the end of 2008), this measure will ensure adequate provision of support concerning the overall coherence of the implementation/co-operation process with a view to a possible review of the main outcomes/deliverables in the first years following the CROQF’s adoption. It should, inter alia, address the following issues: development of the sustainable CROQF’s implementation structure (including sustainable platforms for on-going consultations at the national level), ensuring consistency with emerging policies and objectives of the EU/EC Directives in the field of education and employment, more targeted linking/pilot-testing of the CROQF with respect to the particular levels, validation of non-formal and informal learning as well as quality assurance and accreditation. Within the context of developing a CROQF, this measure is intended to foster modernisation and the further development of the vocational education and training (VET) system in particular in order to facilitate its adaptation to structural changes in the economy and compliance with the EU acquis, most notably with the ongoing VET Copenhagen process. Building on the experience of the successive CARDS VET 2001-2003 projects, and the imminent implementation of further VET reform, this project addresses issues of immediate concern following the first phase of the reform including: a more comprehensive modernisation of VET curricula in line with the new sectoral approach at the national level; establishment of a quality assurance system (including further development of the management information system); and the introduction of sustainable institutional structures (including the funding mechanisms) at the national level in the field of VET innovation. The measure is intended to effectively consolidate and implement reformed VET policy at the national level. It should establish a core network of VET establishments and pilot-centres with the capacity to meet the required modernisation of education content and delivery (most notably, new high- quality curricula and relevant quality assurance activities) and providing for the necessary continuous review and adaptation of VET provision to suit particular local needs. Specific objectives To strengthen investment in human capital in Croatia and promote greater employability by assisting the development and implementation of a coherent HRD policy and national qualifications framework To increase the overall labour market relevance including the efficiency and quality of the education and training systems Main types of operations Indicative operations under this measure include: • Support for the introduction of a systematic CROQF peer-review process with a joint-participation of the national and EU member states experts and ensure regular provision of relevant modifications (process, outcomes). • Establishment of the framework for the pilot-testing of specific elements of the CROQF addressing the specific needs of national
54 stakeholders and sectors, including (i) robust and transparent quality assurance mechanisms, (ii) promotion of validation of non-formal and informal learning,(iii) CROQF related guidance and counselling, and/or (iv) introduction relevant outcomes as the basis of curricula delivery as well as other needs based on the priorities of the CROQF Committee. • Targeted support for the development of the designated national EQF centre, particularly its function of regular monitoring and linking of the CROQF with reviewed EQF’s recommendations and further development of other EU processes and instruments/mechanisms (e.g. ENIC-NARIC Network, VET Copenhagen Process, Europass framework for transparency of qualifications, Ploteus portal on learning opportunities, adopted Employment Guidelines/other specific EC Directives, etc.). • Further improvements of the CROQF consultation and mainstreaming process at the regional/national level and related awareness-raising/capacity building campaigns (including development of user-friendly manuals supporting stakeholders at the regional/national level). • Targeted support to continuous development of the VET Sectoral Councils, the methodology for qualification & framework curricula development and further curricular interventions in selected occupational families • Support for the design and implementation of a 'VET Innovation Fund' in respect of on-going initiatives to be carried out by VET establishments at the regional and local level (depending on the specific priorities - e.g. VET curricula innovations, innovative in- service training schemes, quality assurance); • Pilot-testing of the VET Innovation fund through identification and selection of a core network of 'model' VET secondary schools including a grant scheme to promote curricular innovations in line with the local and/or regional needs (activities will largely be 'soft' but will also include small-scale purchase of relevant equipment and other study aids, building adaptation and refurbishment). • Support to institutional and policy development in the field of VET quality assurance • Further capacity building of relevant VET secondary school staff and other key practitioners and stakeholders. • Introduction and implementation of entrepreneurial, student-centred pedagogical methods of teaching and content into VET curricula • Further improvements of the Vocational Education and Training Information System (VETIS) and systematic exchange of experience
55 and information on the VET QA • Establishment/consolidation of partnerships between VET secondary schools and economic/social actors at the local and national level.
Target groups Teachers and students of vocational training institutions Trainers involved in practical training (including apprentice schemes) at enterprises CROQF bodies/ all other relevant stakeholders involved in the overall development of the CROQF Representatives of VET institution maintainers Representatives of employers and trades unions. Relevant officials of MSES, AVET and AAE Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In fulfilling its responsibilities and delegating tasks in relation to this measure, the MELE will work closely with the Ministry of Science, Education and Sport (MSES) through operational agreements, which will be subject to the accreditation process. Specific bodies under The Agency for Vocational Education and Training (AVET) as Implementing Operating Structure (Art Body. 31 of IPA IR) The Head of the Operating Structure will establish a Sectoral Monitoring Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries Educational establishments at all levels (including providers of non-formal education), VET institutions, AVET. Selection modalities and Appraisal and selection will be performed by Selection Committees at two specific related criteria levels: • Project Selection Committees – these will consider any applications for funding from grant schemes, and will be chaired by AVET as Implementing Body;
56 • Tender Selection Committees – these will select contractors for works, supply and/or service contracts, which are put out to tender under procurement rules and regulations, and will be chaired by the AVET as Implementing Body. Selection criteria shall include: • Demonstrated orientation towards transparency and co-ordination of the actions applied in the functioning of the CROQF • A clear demonstration of the relationship between the project and requirements of the creation of consistent educational programmes/framework curricula within the VET system in line with the comprehensive Croatian Qualifications Framework (CROQF); • The involvement of the public, non-profit and private sectors; • Financial efficiency, including costs per unit output; • Participation of the private sector and/or the non-governmental/non-profit sector in financing the project. • Orientation towards comprehensive approaches in the curricula development/implementation involving higher-level skills, multi-skills and a mix of technical, methodological and behavioural competences; • Orientation towards introduction and development of innovative standards, quality assurance mechanisms and of recognition of non- formal and informal learning; • Orientation towards regional inequalities in access to education and training, as well as employment. • Orientation towards student accessibility to existing and new study programmes.
The project selection process will take appropriate account of regional disparities to ensure that the needs of the regions faced with high unemployment rates are effectively addressed through appropriate VET provision.
Title of Measure Measure 3.2. Strengthening the provision of Adult Learning Description This measure is intended to improve Croatia’s adult and higher education system and enable students of all ages to acquire skills and competencies
and thus better respond to labour market needs. It will build on the experience of previous EU assisted projects, in particular CARDS 2004 Adult learning. It will also build on the new Act on Adult Education (adopted in February 2007) and the National Strategy for Adult Education and its respective Yearly Action Plans. The strengthening of the Croatian adult education system will proceed in line with the development of the Croatian Qualifications Framework. Finally, it is intended that support will be available under this measure to polytechnics as the institutions that offer professional study programmes related to higher VET education.
57 Specific objectives To improve skills and competences of adults to enable them to participate more actively in the labour market. Main types of operations Indicative operations under this measure include: • Development of an institutional framework of local centres/bodies for entrepreneurial and other skills; • Basic capacity building of selected local centres/institutions; • Procurement of equipment for selected local centres/institutions;
• Comprehensive development of the basic competences programmes in line with the EU Reference Framework for Key Competences Target groups Adult students. Teachers and trainers in adult education institutions, polytechnics and schools of higher learning. Managerial staff of education institutions Local government and regional/local CES offices. Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In fulfilling its responsibilities and delegating tasks in relation to this measure, the MELE will work closely with the Ministry of Science, Education and Sport (MSES) through operational agreements, which will be subject to the accreditation process. Specific bodies under The Agency for Vocational Education and Training Implementing Body. Operating Structure (Art The Head of the Operating Structure will establish a Sectoral Monitoring 31 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure in agreement with the European Commission Final beneficiaries Institutions providing adult education. Non-governmental organisations in the field of adult education. Polytechnics and schools of higher learning.
58
Selection modalities and Appraisal and selection will be performed by Selection Committees at two specific related criteria levels: • Project Selection Committees – these will consider any applications for funding from grant schemes, and will be chaired by AVET as Implementing Body ; • Tender Selection Committees – these will select contractors for works, supply and/or service contracts, which are put out to tender under EU procurement rules, and will be chaired by the AVET as Implementing Body. Project selection criteria shall include: • A clear demonstration between the relationship of the project with the specific requirements of the adult and life-long learning; • The involvement of partners from the public, non-profit and private sectors in management and financing; • Financial efficiency, including costs per unit output; • Orientation towards the needs of unemployed adults and adults who need to improve their skills and competencies to labour market needs; • Orientation towards regional inequalities in access to education and training, as well as employment. The project selection process will take appropriate account of the regional disparities to ensure that the needs of the regions faced with high unemployment rates are effectively addressed through appropriate adult education provision.
59
Title of Measure Measure 3.3. Supporting the development of institutions and their partners responsible for the provision of vocational education and training, and adult education Description Providers of vocational education and training in Croatia will need to be strengthened if they are to meet the challenges of EU accession. Although many elements of an effective policy framework are in place, the Agency for Vocational Education and Training, Agency for Adult Education, the Education and Teacher Training Agency and the teaching establishments themselves all need to acquire substantially more professional capacity. This measure is closely related to, and will be designed and delivered in co- ordination with, the other measures delivered under this Priority Axis. Specific objectives To support the development of the capacity of Croatia's public institutions and relevant non-governmental partners in the vocational education and training field as well as in the field of adult education Main types of operations The single indicative operation under this measure is a comprehensive strengthening of the capacities of the AVET, comprising: • A review of current responsibilities of the AVET/AAE and specific recommendations, reflecting the evolving requirements of the Croatian VET/AE system; • Support to AVET and AAE in organisational and management activities; • Support to AVET in the design and preparation of manuals, operational procedures, guidelines, checklists and templates; • Elaboration of a mid-term plan for the AVET’s research and analysis function; • Elaboration of an international partnership programme and Action Plan for: internal development planning, decision-making, overall VET management, project preparation and co-financing, etc.; • Establishment of a training system for AVET/AAE staff and relevant staff members of other key institutions Target groups Staff and officials of the Agency for Vocational Education and training, Agency for Education, Agency for Adult Education, the Education and Teacher Training Agency, and MSES . Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In fulfilling its responsibilities and delegating tasks in relation to this measure, the MELE will work closely with, the Ministry of Science, Education and Sport (MSES) through operational agreements, which will be subject to the accreditation process. Specific bodies under The Agency for Vocational Education and Training (AVET) Implementing Operating Structure (Art Body. 31 of IPA IR) The Head of the Operating Structure will establish a Sectoral Monitoring Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure
60 and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries The Agency for Vocational Education and Training. Selection modalities and Appraisal and selection will be performed by a Tender Selection Committee specific related criteria to select the contractor for a service contract. The tender will follow EU procurement rules, and the committee will be chaired by the AVET as Implementing Body. Selection criteria shall include: • Coherence with education sector development plan (2005-2010); • Coherence with the outcomes of the CARDS 2001-2004 projects.
Priority Axis 4 – Technical assistance
Title of Measure Measure 4.1. Project preparation. Description The measure will support the preparation of project pipeline and support relevant institutions and potential beneficiaries in the preparation of the required documentation. This includes the generation of project ideas and their elaboration into mature and high-quality proposals with all the supporting technical documentation. Specific objectives To prepare a project pipeline for all operations and measures and ensure sufficient projects are fully mature and ready for submission to the Project Selection Committee throughout the programme’s duration. Main types of operations • Support to final beneficiaries in the preparation of tender documentation for service and supply contracts; • Support to implementing bodies in the preparation of guidelines for potential applicants; • Support to potential grant applicants in the preparation of their applications Target groups Those employed by: VET institutions and local government (as owners of such institutions) Centres for Social Welfare, Local partnerships for employment.
61 Non-profit private/public institutions operating at the regional/local level; Regional/municipal development agencies and technological incubators; VET schools and adult learning institutions; Employment brokers Non-profit organizations Open universities Representatives of employers and trades unions. Public primary schools Local government bodies and their institutions Non-governmental / non-profit organisations and their institutions The MELE, MSES and MHSW as final beneficiaries of service/supply contracts The CES and AVET as Implementing Bodies – in relation to organising grant schemes. Head of Operating The Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In fulfilling its responsibilities and delegating tasks in relation to this measure, the MELE will work closely with other relevant line ministries, where appropriate, namely, the Ministry of Science, Education and Sport (MSES) and the Ministry of Health and Social Welfare (MHSW), through operational agreements, which will be subject to the accreditation process. Specific bodies under The Croatian Employment Service (CES) as Implementing Body. Operating Structure (Art The Head of the Operating Structure will establish a Sectoral Monitoring 31 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio-economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission Final beneficiaries For this measure final beneficiaries are the institutions employing those officials identified under target groups. Selection modalities and Appraisal and selection of the service contact holder will be performed by a specific related criteria Tender Selection Committee to select the contractor for a service contract. The tender will follow EU procurement rules, and the committee will be
62 chaired by the CES as Implementing Body. Individual Technical Assistance activities will be planned on a rolling annual basis for the duration of the HRDOP.
Title of Measure Measure 4.2. Programme management and capacity building Description The measure will support the Croatian public administration in the development of the systems, processes and skills for managing and implementing IPA Component IV at both national and regional/local level and to support potential final beneficiaries in the public, non-governmental and private sectors, as appropriate. Given the need to address staff turnover within the public administration allied to the demands of EU funds management which are typically higher than comparable civil service positions, co-financing of the salary costs of public officials within the management structure and project selection committees will be provided as appropriate under this measure. As part of this co-financing, staff development will focus in particular on advanced language and communication skills, as well as specific competences in EU programme management. Specific objectives To ensure efficient and effective OP management, and develop the institutional capacity for managing and absorbing IPA component IV assistance. Main types of operations • Support to the Croatian OP administration regarding any aspect of management, monitoring, evaluation and control, including grant scheme management and procurement; • The preparation and implementation of information and publicity activities; • Support to the elaboration of sector studies and master plans; • Support (including advice and training) to socio-economic partners, beneficiaries and civil society, to support the development and implementation of measures (including grant schemes) in specific sectors; • Provision of translation and interpretation services; • Co-financing of staff salary costs; Target groups Officials within the following agencies. MELE (Labour Directorate) The CES central office CES county offices Agency for Vocational Education and Training. Ministry of Science, Education and Sports Ministry of Health & Social Welfare Counties-Social Welfare Units ETTA and AAE The Audit Authority
63 Members of the Monitoring Committee Project Selection Committees the Croatian Bureau of Statistics CODEF Head of Operating Ministry of Economy, Labour and Entrepreneurship (MELE). Structure In fulfilling its responsibilities in relation to this measure, the MELE will work closely with other relevant line ministries, where appropriate, namely, the Ministry of Science, Education and Sport (MSES) and the Ministry of Health and Social Welfare (MHSW), through operational agreements, which will be subject to the accreditation process. Specific bodies under The Croatian Employment Service (CES) as Implementing Body. Operating Structure (Art The Head of the Operating Structure will establish a Sectoral Monitoring 31 of IPA IR) Committee within 6 months after the entry into force of the IPA Implementing Regulation. This Committee will be co-chaired by the Head of the Operating Structure and a representative of the European Commission. Its members will include the National IPA Coordinator or his/her representative, the National Authorising Officer or his/her representative, a representative of the European Commission, the Strategic Coordinator for Components III and IV or his/her representative, the Head of the National Fund or his/her representative, representatives of all specific bodies making up the Operating Structures as well as representatives from civil society and socio- economic partners; the Committee will also include regional and/or national organisations with a relevant interest in contributing to the effective implementation of the programme to be agreed at its 1st meeting. In order to ensure sufficient representation and membership, the composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure inn agreement with the European Commission. Final beneficiaries For this measure final beneficiaries are the national-level institutions employing those officials identified under target groups above. Selection modalities and Appraisal and selection of the service contact holder will be performed by a specific related criteria Tender Selection Committee to select the contractor for a service contract. The tender will follow EU procurement rules, and the committee will be chaired by the CES as Implementing Body. Individual Technical Assistance activities will be planned on a rolling annual basis for the duration of the HRDOP.
64 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
3.2 Indicators
Priority Axis 1: Enhancing Access to Employment and Sustainable Inclusion
Measure 1.1: Supporting the design and implementation of active and preventative labour market measures To develop regional Number of Human No of decisions 4 21 Annually CES reports, participatory resources by county reports by the institutional development plans authorities county framework for (prepared by Local authorities promotion of Employment employment Partnerships) accepted by the county assemblies14 Undertake local Number of Number 8 21 Annually CES data; employment initiatives employment documents on partnerships agreements established between partners; Project monitoring reports
Carry out labour market Number of HRD Number 8 21 Annually CES,/LPE surveys partners data; strategies Project Elaborate local HRD developed monitoring strategies reports
14 All the indicators in this section which are defined at the measure level have been formulated on the basis of the operations listed under that specific measure
65 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Develop project Number of project Number 0 21 Annually CES/LPE generation and portfolios partners data; articulation facilities in developed15 Project CES at the regional level monitoring reports Implement grant Number of persons Number Values cannot be Bi-annually Project schemes in line with the who received defined at present monitoring objectives of the HRD support through due to the lack of reports; strategies the grant schemes statistical data and Evaluative the fact that target work reports groups for specific grant schemes will be determined after the elaboration of HRD strategies & priorities. They will be established in the first year of operation and agreed at the Sectoral Monitoring Committee.
15 Project portfolios are developed at the level of each county in line with the priorities established in the HRD strategies. The term 'project portfolio' relates to a specific number of project or grant schemes ready for financing.
66 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Measure 1.2: Supporting the effectiveness and quality of Croatia's employment services To improve the Number of CES Number 5 25 Annually CES - Human quality, effectiveness staff certified for resources and efficiency of provision of database Croatian employment different types of service services to clients by type of service as a result of capacity building operations and improved business processes provided through the measure Development of the Number of steps Number 0 3 Bi-annually Project capacity to formulate a undertaken to the monitoring coherent legislative establishment of reports framework for lifelong the lifelong career
career guidance guidance centre provision
Establishment of a National Forum for lifelong career guidance
Establishment of a model for lifelong career guidance centre and its pilot-testing
67 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Strengthen the analytical Number of CES Number 2 At least Annually CES - HR capacity of CES and and MELE staff 10 database; MELE through training trained in MELE reports; analytical work Project monitoring reports Establish a training Number of trainers Number 5 35 Annually CES- HR facility within CES for for key business database key skills for counsellors processes in CES (focusing on the unemployed), advisors (focusing on the employers), lifelong career guidance counsellors, specialized counsellors for disadvantaged groups and skills for other CES processes Support design and Number of key Number 3 5 Annually CES - implementation of business business improved business processes process processes with the supported with ICT related CES’s IT system and solutions database user-friendly IT solutions, including upgrading of the IT equipment & software Create a system of Number of key Number 0 5 Annually CES quality assurance, business
monitoring, evaluation processes and training-needs equipped with
68 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
assessment for CES quality assurance business processes indicators
Priority Axis 2: Reinforcing social inclusion and integration of people at a disadvantage
Measure 2.1: Supporting access to employment by disadvantaged groups To promote social Share of % 0 10% Annually CES – ALMP inclusion of the disadvantaged database; (baseline disadvantaged groups who were value for Project groups through their beneficiaries of the the type of monitoring integration to the measure and who activities reports; labour market remain in foreseen Evaluative employment one by the work reports year after measure) placement Number of Number 0 40 Annually CES reports; disadvantaged MHSW unemployed reports; persons included in Project the new inter- monitoring institutional reports: business Evaluative processes16 that work reports promote social inclusion into the labour market
16 The term 'business processes' denotes new methods of work with the disadvantaged groups by various governmental and non-governmental actors, to promote employability and inclusion into the labour market of the disadvantaged
69 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Development of new Number of new Number 0 3 Annually CES reports; inter-institutional and business MHSW inter-sectoral business processes targeted reports; processes for the work at the social Project with disadvantaged inclusion of the monitoring groups disadvantaged reports Training of staff (basic Number of staff Number 24 30 Annually Project and advanced) in the trained for the monitoring employment and social work with reports; CES welfare services disadvantaged - HR (governmental, self- groups database; governmental, public, MHSW non-governmental) for reports; social work with disadvantaged welfare groups centres reports
Training and retraining Number of Number Values cannot be Bi-annually CES reports; of disadvantaged groups unemployed defined at present due MHSW disadvantaged to the lack of statistical reports; persons benefiting data. They will be Project from grant established in the first monitoring schemes (broken year of operation and reports; down in specific agreed at the Sectoral Evaluative target groups) Monitoring Committee. work reports
Measure 2.2: Supporting access to education by disadvantaged groups To support access to Proportion (%) of % 0 50 Annually MSES, education for disadvantaged MHSW, AE & employment by persons (broken AVET disadvantaged down by common reports; groups through, inter aggregate groups) educational alia, promoting a having a new/ establishment
70 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012) more flexible policy second access to reports; framework and targeted Evaluative innovative provision educational work reports of relevant services. services and/or
modernised facilities.
Supporting the design Number of Number 0 At least Annually MHSW, educational 20 MSES, AAE, and implementation of establishments at AVET educational programmes specifically targeted on the local/regional periodical
disadvantaged groups level involved in reports and (including upgrading the development of statistics; facilities and equipment educational Project
where appropriate). programmes monitoring reports
Number of pilot- testings of educational 10 programmes Number 0 Annually specifically targeted on disadvantaged groups. Number of persons Values cannot be MHSW, assisted through defined at present due MSES, AAE, Number Annually the grant scheme to the lack of statistical AVET data. They will be periodical established in the first reports; year of operation and Project agreed at the Sectoral monitoring Monitoring Committee. reports; Evaluative
71 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
work reports Building the capacity of Number of Number 0 50 Annually MSES, AVET education professionals educational reports; in new services for the professionals who Project disadvantaged, primarily were beneficiaries monitoring in the VET sector of training or tech. reports assist. measure
Priority Axis 3: Enhancing human capital and employability
Measure 3.1: Further development of the Croatian Qualifications Framework
To strengthen Share (%) of VET / % 0 30 Bi-annually MSES, ASHE, higher education AVET reports; investment in human (baseline students (by CBS statistics; capital in Croatia and value for common levels of Evaluative promote greater the type of EQF) in pilot- work reports employability by activities institutions having helping Croatia foreseen followed any type develop and by the of education / implement a coherent measure) HRD policy and training based on national qualifications the reviewed framework, and to CROQF, increase the overall modernised labour market curricula and relevance, efficiency quality assurance and quality of the mechanisms. education and training systems
72 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Establishment of a Number of steps Number 0 4 Bi-annually Project designated national EQF undertaken to monitoring centre ensure the reports; CROQF MSES/CROQF
implementation Committee Support to the reports
introduction of a
systematic CROQF peer- review process
Implementation of the pilot-testing of specific CROQF elements
Further improvements of the CROQF consultation and mainstreaming process and related awareness- raising/capacity building campaigns Targeted support to Number of Number 20 70 Annually Project continuous development occupational monitoring (expected of the VET Sectoral standards and reports; AVET until 20 Councils, the qualifications/fram reports; April methodology for ework curricula curriculum 2008) qualification & framework developed to a development curricula development specified standard working groups reports
73 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Support for the design Number of VET Number 0 At least Annually Project and implementation of a schools receiving 20 monitoring 'VET Innovation Fund' grant support reports; AVET under the Pilot- reports; VET
VET Innovation school reports Pilot-testing of the VET Fund established Innovation fund on the basis of the VET Innovation Strategy Support to institutional Number of VET Number 0 At least Annually Project and policy development schools carrying 20 monitoring
in the field of VET quality out the pilot testing reports; AVET
assurance. of the self- reports; VET evaluation at the providers micro level reports Further capacity building Percentage of staff % 0 At least Annually Project of relevant VET and practitioners 20 monitoring
secondary school staff included in reports, AVET
and other key capacity building reports, VET
practitioners in the field activities out of the school reports of QA total number of staff
74 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Further improvements of Number of new Number 4 At least Annually Project the Vocational Education modules17 within 7 monitoring and Training Information VETIS developed reports; AVET System (VETIS) and reports systematic exchange of experience and information on the VET QA
Measure 3.2: Strengthening the provision of Adult Learning Number of Number Values cannot be Bi-annually MSES & AAE unemployed adult defined at present reports, CBS
To improve skills and persons and other due to the lack of statistics; competences of target groups of statistical data. They Evaluative adults and so enable adult population at will be established in work reports the local level the first year of them to participate more actively in the enrolled in new / operation and agreed labour market. modernised adult at the Sectoral learning Monitoring programmes. Committee. Development of an Set of criteria for Number 0 1 Annually Project institutional framework the selection of monitoring
for institutions at the institutions at the reports; AAE local level, for local level reports; entrepreneurial and other identified Evaluative basic skills work reports Number of train- Number 0 At least Annually Project Basic capacity building of the-trainers (ToT) 4 monitoring selected local institutions modules designed reports; AAE and delivered. reports
75 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Procurement of Training equipment Number 0 At least Bi-annually Project equipment for selected sets procured and 15 monitoring local institutions. installed. reports; AAE reports Comprehensive Number of new / Number 0 At least Annually Project development of the modernised basic 10 monitoring basic competences skills training reports; MSES; programmes in line with programmes AAE reports; the EU Reference developed. Evaluative Framework for Key work reports Competences.
Measure 3.3: Supporting the development of institutions and their partners responsible for the provision of vocational education and training, and adult education % 0 At least Annually MSES, AAE, Share (%) of the 20 AVET reports employees and
external expert/ associates of the To support the Croatian public development of the institution and capacity of Croatia’s other institutions public institutions and who successfully relevant non- completed governmental specialist capacity partners in the building activities vocational education and are certified to and training field and provide adequate in the field of adult support to ongoing education. VET / adult learning reform.
76 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Number of specific Number 0 At least Annually Project cohorts (with at 14 monitoring least 10 staff reports; AVET members of the and AAE AVET/other key reports institutions per each activity) involved in tailor- made training & other TA support in specific VET / AL areas and overall AVET’s development A review of current Number of steps Number Values cannot be Bi-annually Project responsibilities of the undertaken to defined at present. monitoring AVET/AAE and specific ensure that They will be reports; recommendations, administrative determined in the Evaluative reflecting the evolving capacity is further course of OP work reports requirements of the built in the relevant implementation
Croatian VET system institutions through evaluative work.
Support to AVET and AAE in organisational and management activities and in the design and preparation of manuals, operational procedures, guidelines, checklists and templates
77 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Elaboration of a mid-term Mid-term plan for Number 0 1 Annually Project plan for the AVET’s AVET research monitoring research and analysis and analysis reports; AVET function function prepared. reports Elaboration of an International Number 0 1 Annually Project international partnership partnership monitoring programme and Action programme and reports; AVET Plan for: internal Action Plan reports development planning, prepared. decision-making, overall VET management, project preparation and co-financing, etc Establishment of a Training plan Number 0 1 Annually Project training system for prepared monitoring
AVET/AAE staff and reports; AVET
relevant staff members and AAE Number of persons of other key institutions Number 0 14 reports trained
78 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Priority Axis 4: Technical Assistance
Measure 4.1: Project preparation To prepare a project Number of mature Number 0 At least Bi-annual Project pipeline for all projects ready for 20 monitoring operations and contracting reports: measures and Sectoral ensure sufficient Monitoring projects are fully Committee mature and ready for reports submission to the Project Selection Committee throughout the programme duration.
Support to final Number of tender Number 0 At least Bi-annual Project beneficiaries in the document sets 8 monitoring preparation of tender prepared reports documentation for service and supply contracts Support to implementing Number of Number 0 At least Bi-annual Project bodies in the preparation guidelines 5 monitoring of guidelines for prepared reports potential applicants Support to potential Number of potential Number 0 At least Bi-annual Project grant applicants in the applicants 40 monitoring preparation of their receiving support reports applications through TA
79 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Measure 4.2: Programme management and capacity building
To ensure efficient Quality of OP Criteria and units for measuring the Annually Evaluative and effective OP management (of performance and OP management will work reports management, and monitoring system, be defined by the Evaluation Steering develop the financial control Committee. institutional capacity system, project for managing and selection system absorbing IPA and evaluation component IV system) assistance Support to the Croatian Number of staff Number 0 At least Bi-annually Project OP administration, from OP 10 monitoring regarding any aspect of administration reports management, bodies involved in monitoring, evaluation the capacity and control, including building operations grant scheme management and procurement.
Support to the Croatian OP administration in elaboration of sector studies and master plans The preparation and Number of Number 0 At least Bi-annually Project implementation of information events 10 monitoring information and publicity organised reports activities
80 Specific objective Result indicator Main type of Output indicator Measurement Baseline Final Frequency Data sources operations unit value target of review (2012)
Support (including Number of persons Number 0 At least Bi-annually Project advice and training) to involved in training 20 monitoring socio-economic or technical reports partners, beneficiaries assistance and civil society, to operations support the implementation of measures (including grant schemes) in specific sectors
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3.3 Horizontal issues
3.3.1 Gender equality and prevention of discrimination In September 2006, the Croatian Government adopted the National Policy for the Promotion of Gender Equality, 2006-2010 (Official Gazette, no. 114/06). The legal basis for the adoption of the National Policy for Gender Equality was introduced into Croatian legislation with the coming into force of the Gender Equality Act (Official Gazette, no. 116/03), by which gender equality means that men and women are equally present in all fields of public and private life, that they have the same status, equal opportunities to realize all rights, and equal benefit of the results realized. The objectives of the policy, which are of particular relevance to Components III & IV of IPA, include the reduction of female unemployment and elimination of discrimination, promotion of women’s entrepreneurship and improved enforcement of relevant labour laws. It also strengthens and promotes measures that support the reconciliation of professional and family obligations. The application of the principle of gender equality and prevention of discrimination on the basis of gender, race, ethnical origin, religion or beliefs, injuries, age or sexual orientation including taking account of accessibility for disabled persons in defining and selecting operations is a compulsory integral part of the EU’s policies and practices. Equal opportunities and non-discrimination will be respected regarding gender, as well as minorities, at the programming, implementation and evaluation stage of the HRDOP. This will be reflected in the monitoring indicators and data collection, and implementation procedures and guidelines,. The Member States and the Commission shall ensure that equality between men and women and the integration of the gender perspective is promoted throughout the various stages of implementation of the Funds. The Member States and the Commission shall also ensure appropriate access to funding. In particular, accessibility for disabled persons shall be one of the criteria to be observed in defining operations co- financed by the Funds which should be taken into account during the various stages of implementation. Since IPA will prepare Croatia for the Structural Funds (the ESF in particular), the HRDOP was designed and will be implemented in accordance with Article 16 of the SF regulation, which states that appropriate steps shall be taken to prevent any discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation during the various stages of implementation. In relation to gender equality in particular, a gender mainstreaming approach will be combined with specific action to increase the sustainable participation and progress of women in employment (under Priority Axes 2). To ensure that these principles are taken into account at all levels of implementation, the following procedures will be adopted: Participation of the representatives of the Government Office for Gender Equality and the Government Office for Human Rights will be ensured in the work of the Sectoral Monitoring Committee, in order to monitor implementation of the principle of gender equality and anti-discrimination; The requirement to ensure and demonstrate gender equality and non-discrimination in the operation of IPA projects will be included in both information and publicity campaigns, and materials provided during calls for proposals / tender processes; Applicants for IPA assistance will be expected to demonstrate how their project promotes equal opportunities or otherwise takes account of potential gender bias (e.g. by providing gender segregated information on the local labour market, and the efforts of the project to overcome any barriers to equality); Gender and anti-discrimination implications will be taken into account through the project appraisal process and selection criteria; The requirement to observe equality of opportunity and avoid discrimination during project implementation will be built into agreements with beneficiaries, and will be checked, as part of the internal controls and independent audit process;
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The outputs and results indicators for projects will be broken down by gender where appropriate for the purposes of project and programme monitoring, as set out in section 3.218; Commentary will be prepared on operations linked to equal opportunities in the annual implementation reports of the Operational Programme; The impact of the OP on gender equality will be considered as part of its evaluation, where relevant. The Operating Structure will make sure that all operations co-financed by the IPA programme are in compliance with and contribute to the equal opportunities policy and legislation of the Community.
3.3.2 Sustainable development and environment protection There are no specific environmental measures in this Operational Programme. However, to ensure that sustainability and environmental protection are taken into account throughout programme management and implementation, the following procedures will be adopted: The requirement for IPA to promote environmental protection & sustainable development will be included in both information and publicity campaigns, and materials provided during calls for proposals / tender processes; Applicants for IPA assistance will be expected to demonstrate that their project will not have a detrimental environmental impact, to certify that it is environmentally neutral, and/or to present how the project will make a positive contribution to sustainable development; these factors will be taken into account through the project appraisal process and selection criteria, if appropriate; where appropriate, projects should be compliant with EU Environmental Impact Assessment standards Any consequences of the appraisal of environmental impact during the selection stage will be reflected in agreements with beneficiaries, and will be checked, as part of the internal controls and audit process; Commentary will be prepared on operations linked to environmental protection & sustainable development in the annual implementation reports of the Operational Programme; The impact of the OP on environmental protection & sustainable development will be considered as part of its evaluation. All necessary environmental impact assessment procedures will be carried out by MEPPPC or competent local authority. To implement the environmental impact assessment procedure, existing institutional structures will be used, and TA assistance will be sought to enhance professional capacity. The Republic of Croatia has been performing environmental impact assessment for single developments since 1984, when the procedure was defined by the Act on Physical Planning and Spatial Development. Since 1994, when the Environmental Protection Act was adopted (OG 94/1994, 128/1999), the environmental impact assessment procedure is governed by this Act and its implementing regulation. The effective implementing regulation is the Ordinance on Environmental Impact Assessment (OG 59/00, 136/2004, 85/2006). The Act and Ordinance partly include requirements from Council Directive 85/337/EEC of 27 June 1985 as amended by 97/11/EEC and 2003/35/EC on the assessment of the effects of certain public and private projects on the environment, relating to: establishment of responsible bodies, EIA in a trans-boundary context, description of the EIA procedure, and assessment of direct and indirect effects. The transposition of the remaining provisions of the Directive into Croatian legislation will be ensured by adoption of the new Environmental Protection Act in the second half of 2007, and the implementation regulation on environmental impact assessment, in addition to it. In that sense the CARDS 2003 project "EIA Guidelines and Training“, which started in July 2005 has been recently implemented. This project assisted in the transposition of Council Directive 85/337/EEC, as well as in the building of administrative capacities of civil servants working on EIA at the national and county level, as well as in promoting public participation in the EIA procedure. Further capacity-building actions are likely to be required. By adopting the new Environmental Protection Act and its subordinate special regulations:
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the provisions of Directive 2001/42/EC of the European Parliament and Council of 27 June 2001 on the assessment of the effects of certain plans and programmes on the environment will be transposed, the provisions of Council Directive 96/61/EC of 24 September 1996 on Integrated Pollution Prevention and Control (IPPC) will be transposed. Moreover, a transposition of Directive 2004/35/EC of the European Parliament and Council of 21 April 2004 on environmental liability with regard to the prevention and remedying of environmental damage is envisaged. Recognised principles of environmental protection, including also the polluter pays principle, are already in force in Croatia.
3.4 Complementarities with other forms of assistance
3.4.1 Previous and planned EU assistance The programming of assistance from IPA takes account of the experience of previous EU assistance in the fields of human resources development and social inclusion. Attention is also focused on the need to co- ordinate IPA assistance with interventions financed by international financing institutions and international donors. As an integral part of the review of all previous and planned EU assistance, all measures and their constituent operations under this Operational Programme will be assessed insofar as is feasible to ensure no duplication with such assistance. Overall, EU assistance to Croatia has evolved from post-war re-construction and humanitarian aid (in the late 1990s) through stabilisation and association support (CARDS programme) to the use of three pre- accession programmes (Phare, ISPA and SAPARD) for 2005 and 2006. However, it remains the case that much EU assistance to Croatia has been devoted to alleviate the after effects of the war and that only relatively recently has the focus shifted to developing the capacity of the public administration at either the national or local level. EU assistance in this area has so far targeted three sets of issues: policy development, institutional reform and capacity building and preparation for delivery of ESF through experience with grant schemes. In the field of employment, projects aim at enhancing the administrative capacity at both national and local level, as well as preparing the administration for the effective absorption of future assistance under the European Social Fund, but to a limited degree. A CARDS 2001 project, 'Labour Market Restructuring', started in the middle of 2003, and was completed at the end of 2005. This programme achieved the following: A Labour Market Survey was conducted in four counties and subsequently based on the obtained results a Labour Market Study for these counties was undertaken. A strategy for the Vocational Guidance Services was designed; 12 counsellors from the Vocational Guidance Department were trained to in turn train those in schools and the CES itself who provide students with information and counselling services about their opportunities on the labour market. 26 CES counsellors were trained to provide services to disabled and hard-to-place persons. The CASCAiD Programme has been established in order to improve the system of vocational guidance. Information equipment was purchased and installed in the CES Central and Regional Offices and 36 computers were also given to the Ministry of Science, Education and Sports for the needs of the CASCAiD Programme. A donation contract for €1,500,000 was signed between the Fund for Development and Employment and the European Commission financing the work of Mobility Centres. Seven Mobility Centres were established with the purpose of providing services for the workers in enterprises undergoing the process of restructuring. Counsellors for that work were also trained.
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One of the lessons learned from the project related to the complexities of the preconditions that it was necessary to meet to establish mobility centres. Under the CARDS 2002 and CARDS 2004 'Local Partnerships for Employment' projects, 8 counties benefited from technical assistance for establishing local partnerships for employment, developing county human resources strategies, setting up the accompanying institutional system and creating a project pipeline. Four Regional Labour Market Councils (RLMC) and four thematic working groups on Human Resources Development have been established. It is planned that the counties in which they are based will benefit from a grant scheme aiming to promote access to employment (including self-employment) within the local labour markets. The CARDS 2002 project was considered to be a success by all stakeholders except for the fact that no associated grant scheme was available immediately. The CARDS 2004 project was more successful in this regard but consideration still needs to be given to the sustainability of the partnerships established and to the fact that the county level may be too low a basis for formulating effective employment strategies; co- operation between counties to establish multi-county strategies (on the NUTS II level or below) also merits consideration. In any event, on the basis of the lessons learned from these two projects the local partnerships still need to be established in the other 13 counties of Croatia. The CARDS 2003 project 'The Decentralization and Reorganization of the Croatian Employment Service' is expected to strengthen the regional and local capacity of the Croatian Employment Service using the promotion of skills, technological knowledge and experience necessary for the decentralized activities of the CES, which will result in a more direct involvement in the local developmental needs and initiatives. The outputs and impact of this project should be evaluated on its completion to draw conclusions regarding the further de-centralisation of the CES. At the same time, appropriate account will be taken of the CES's on- going modernisation as assisted under this Operational Programme. The Phare 2005 project 'Active Employment Measures for Groups Threatened by Social Exclusion' has recently started. The aim of the project is to facilitate access to the labour market by unemployed persons threatened by social exclusion using active labour market policies tailored to their needs. The following results are expected from this project and will be closely monitored in the context of appropriate complementarity and synergy with this Operational Programme: • In-depth analysis of the existing employment incentive measures; • Designing a new range of measures which will build, as appropriate, on previous measures and their follow-up evaluation • In the context of the on-going modernisation process referred to above, higher professional capacity of the CES in designing and implementing active employment policies; • Raised level of employability of the groups threatened by social exclusion. The reform of the VET sector was one of the primary targets of the CARDS programme. In particular, the process of modernisation of the Croatian VET system has received continuous TA support. A VET strategy and a proposal for the content of VET legislation was elaborated with support of CARDS 2002 VET: Modernisation and Institution building programme. A grant scheme, launched within the same programme and implemented under the CARDS 2003 VET Project aims to improve the quality and responsiveness of vocational education and training in Croatia through the development of partnership-based initiatives to raise the quality and responsiveness of VET and increase its relevance to the needs of the labour market and individuals. The Grant Scheme within the CARDS 2003 project was successful in terms of the number of applications received but the 'centres of excellence' approach was not pursued as originally intended. However, this concept, as well as wider VET reform, will be given further consideration in the context of future developments both under component IV and future ESF. These CARDS projects are also supporting the development of Sector Councils and the creation of new qualifications and learning programmes. The CARDS programme will also assist in developing modern and
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flexible concept of adult education for Croatia in line with new labour market requirements, the lifelong learning approach and EU best-practice examples. In the social inclusion sphere, interventions under the Phare programme will support full participation of the Roma and other minorities in the economic, educational, cultural and social life of Croatian society. A CARDS 2002 project supporting Social service delivery by the non-profit sector ended in 2006. This marked the first substantial support to partnerships with the voluntary sector in the provision of social services. Key outputs included technical assistance to the National Foundation for Civil Society Development, line ministries and end-beneficiaries as well as implementation of the Grant Scheme. 105 project proposals were submitted, ten selected and nine completed. A CARDS 2003 project supporting Social service delivery by the non-profit sector continues to support the innovative capacities of NGOs in this area and another such project is ongoing under CARDS 2004. A CARDS programme in the higher education sector has been focusing on legal approximation and strengthening the administrative capacity of the relevant state administration bodies for the implementation of the aligned legislation. This primarily relates to the issues of accreditation and quality assurance of higher education institutions, with the aim of removing the obstacles for the mobility of students and creation of a flexible labour market. Through the TEMPUS programme, the Croatian authorities and universities acquired experience in the management of grant schemes in the field of higher education. The National Tempus office is placed within the Agency for Science and Higher Education and it is responsible for coordinating the implementation of the TEMPUS program; in the experience in the management of grant schemes remains within various universities, which are the main beneficiaries of the TEMPUS programme. Through the projects listed in the table below, administrative capacity has been improved to the point where it provides some basis for the management, implementation, audit and control of future ESF type measures. However, many areas (such health and safety at work, antidiscrimination, social dialog and gender equality policy) have not yet been addressed.
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EU-financed Projects in Croatia (2001-2006) relevant to HRD OP.
Programme/Year Project Title Status
CARDS 2001 Human Capital – Vocational Education and Training completed CARDS 2001 Labour Market Restructuring completed CARDS 2002 Vocational Education and Training: Modernisation and completed Institution Building CARDS 2002 Social service delivery by the non-profit sector completed CARDS 2002 Local Partnership for Employment completed CARDS 2002 Higher Education Mobility: Diploma Recognition Policy and completed Legislation CARDS 2003 Support to National Development Planning ongoing CARDS 2003 Upgrading of Vocational Education and Training Schools – ongoing Establishing Centres of Excellence CARDS 2003 Social Service Delivery by the Non-profit Sector ongoing CARDS 2003 Decentralisation and Reorganisation of the Croatian ongoing Employment Service CARDS 2003 Furtherance of the Agency for Science and Higher Education in ongoing its Quality Assurance Role and the Development of a Supporting Information System CARDS regional Social Institutions support project. ongoing 2003 CARDS 2004 Adult Learning planned CARDS 2004 Social Service Delivery by the Non-profit Sector ongoing CARDS 2004 Local Partnership for Employment – Phase II ongoing Phare 2005 Active Employment Measures for Groups Threatened by Social ongoing Exclusion Phare 2005 Roma Support Project planned Phare 2006 Roma Support Project planned Phare 2006 IB for all elements of IPA/SF structures – follow up to first planned CARDS 2003 project listed above Phare 2006 IPA project pipeline preparation planned
3.4.2 Principles governing complementarity with IPA Component I Component I may be used to re-enforce institutional capacity and to finance preparation for management and implementation of future ESF but only to the extent that this is not already covered by Component IV (under which this is explicitly mentioned in the IPA Implementing Regulation as an eligible activity). Given the variety and scale of projected demands on Component I, it is not envisaged to make wide use of it in support of preparations for the management of ESF with the possible exception of 'twinning' projects set at either the level of component IV itself or in conjunction with component III and the wider IPA arrangements. In any event, it is envisaged that Component I will make a significant contribution towards improving the effectiveness of the public administration generally that will complement the delivery of HRDOP and preparations for ESF management through assistance delivered under Component IV.
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Accordingly, Component I may contribute to varying degrees in financing related activities such as: • the modernization of mainstream education provision and the strengthening of administrative capacity in this area; • upgrading legislative provision for health and safety at work and the enforcement of this and labour law in general; • alignment with the acquis in relation to both labour law and anti-discrimination and gender equality matters.
3.4.3 Complementarity with the Regional Competitiveness OP Under the RC OP, two operational priority axes are included as follows - • Improving the development potential of lagging-behind regions • Enhancing the competitiveness of the Croatian economy.
For its part, the HRD OP contains three operational priority axes, namely • Enhancing access to employment and sustainable inclusion in the labour market • Reinforcing social inclusion of people at a disadvantage • Enhancing human capital and employability.
It is clear that the implementation of the measures under the RCOP Priority Axes will strengthen the potential for achieving a more efficient labour market. At the same time, the measures implemented under this Operational Programme should contribute to the development of a more cohesive and competitive Croatian economy. In the context of developing 'complementarity' across both OPs, the combination of the proposals presented in the table hereunder should achieve a net effect of strengthening cohesion as well as competitiveness. While all such proposals will be assessed in terms of appropriate delivery mechanisms, their acceptance and implementation will be determined at the level of the individual activities undertaken including the application of appropriate selection criteria which reflect the objectives of both OPs. Also in the context of achieving a wider complementarity, certain indirect effects will also contribute to this objective. In particular, the overall strengthening of cohesion and competitiveness should promote an increased and sustainable demand for an appropriately qualified workforce in line with Priority Axes 1 and 3 of this Operational Programme. At the same time, the results arising under Priority Axis 2 ('Reinforcing social inclusion of people at a disadvantage') should also contribute towards this objective though less immediate in terms of impact.
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Priority Axis 1 (HRD OP) RC OP/HRD OP complementarity
Measure 1 will focus on the establishment of Local Employment Partnerships (LEPs) in each Croatian county; moreover, since the Priority axis 1 (HRD OP) first eight such LEPS are already established in the lagging-behind regions, 'inter-county partnerships' will be promoted in these areas. Enhancing access to employment A 'pilot lifelong career guidance centre' will be established through and sustainable inclusion in the Measure 2 in conjunction with a local 'Centre for SMEs' included as labour market a partner. At the same time, activities of a more horizontal nature will incorporate specific selection criteria which take account of regional disadvantage. For both Measures proposed under Priority Axis 2 (Supporting access to employment and to education by disadvantaged groups), Priority axis 2 (HRD OP) new activities will also be developed which focus specifically on Reinforcing social inclusion of regional disadvantage and will be supported by more horizontally- people at a disadvantage based activities which will also build in this focus through specific selection criteria. Under Measure 1 (Strengthening the development of Croatian Qualifications Framework), the development of initial curricula will
include IT and Biotechnology-related19 disciplines and will involve Priority Axis 3 (HRD OP) representatives of the 'ICT cluster' and 'Biotechnology Incubator' projects under Priority Axis 2 of the RCOP in the work of the relevant VET Sectoral Councils charged with curricula development Enhancing human capital and in these sectors; moreover, a significant proportion of the 'model' employability schools to be supported under the VET innovation fund will be located in the lagging-behind regions. Under Measure 2 (Strengthening the provision of lifelong learning and professional higher education), steps will be taken to ensure that activities related to lifelong learning will also focus on disadvantages areas. Because of their 'geographical' focus, the activities supported under this measure will target certain groups of disadvantaged, in Priority Axis 1 (RC OP) particular those located within the lagging-behind regions. In Improving the development addition, further priority may also be given to projects which promote potential of lagging-behind increased employment particularly for groups most affected by other regions forms of disadvantage including the long-term unemployed, women, the disabled and minority groups. Training and capacity-building activities supported under this Priority Axis will be complementary to the wider role of the HRD OP. In Priority Axis 2 (RC OP) particular, they will focus on targeted consultancy services for SMEs as well as support which contributes to the creation and growth of Enhancing the competitiveness of technological and knowledge-based 'spin-offs' (mostly from the Croatian economy. universities and research establishments) as well as SMEs through enhanced infrastructure and access to technology and business development services especially for high value-added sectors.
In practice, co-ordination and complementarity between these two OPs will be assured by cross- membership of their respective sectoral Monitoring Committees. See Chapter 5 for details.
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3.4.4 Other OPs and IPA components In relation to Component II, Cross-Border Cooperation - CBC, the position will be monitored closely with the relevant authorities particularly in view of the fact that CBC OPs together potentially cover Croatia’s whole national territory while the measures they support may be similar to those supported by HRDOP.20 Under Component V (Rural Development), it is envisaged that this will cover specific training of farmers with more general training being included under component IV. Here also, the position will be monitored closely by the Sectoral Monitoring Committee for the IPARD OP (in which the Commission, DG AGRI, will participate in an advisory capacity) including all support provided under national training schemes to meet the specific training needs of farmers. Though likely to arise only in particular circumstances, complementarity with both the Transport and Environment Operational Programmes will also be carefully monitored with the relevant authorities. As specified under chapter 5.1, a number of institutional arrangements have been established to promote complementarity and coherence between the various Components of IPA and the OPs that they support. To this end, CODEF will assume overall responsibility for coordinating programming and monitoring activities under the IPA programme in Croatia while its Department for EU Programmes in the Field of Capacity Building for EU Accession will be responsible for co-ordinating IPA Components I, II and V. For its part, the Department for EU Programmes in the Field of Economic and Social Cohesion will assume responsibility for the co-ordination of IPA Components III and IV. In addition to the overall co-ordination function that will be assumed by the IPA Monitoring Committee, representatives of the Sectoral MCs for Component II (Cross-Border Cooperation) and Component V (Rural Development) will be invited, as deemed appropriate, to attend the RCOP/HROP Monitoring Committees. The committees will be chaired by the Deputy State Secretary of CODEF who has also coordinating responsibility for the elaboration of all four OPs.
3.4.5 IFIs and other international donors The World Bank approved a US$ 85 million (€ 67.8 million) loan for an Education Sector Development Project (ESDP) in 2005. The overall objective of the ESDP is 'to improve teaching and learning at all levels'. Key priorities of the ESDP include (i) the establishment of an externally administrated school-leaving examination (Matura) and the introduction of evaluation practices at system and institutional levels; (ii) the development of decision support systems, such as an Education Management Information System; (iii) efforts to improve management, including policy development, planning and financial management capacities at the central level; administration and coordination capacities at the regional level, and educational leadership at the school level, and (iv) school-level improvement and the creation of professional learning communities in schools by training school curriculum specialists, in-service training for teachers, new teaching and learning facilities, upgrading regional teacher training centres and new curriculum materials for teachers. Implementation of the project started in 2006 and will be used also for financing physical infrastructure for VET schools, combined with national co-funding. The preparatory phase of the project has identified a number of 'teething problems' with regard to institutional capacity of the MSES, including the need to develop a coherent vision for education development and a detailed implementation plan on the use of the funds over the forthcoming period. Given the nature and scope of this project, steps will be taken to ensure that it is closely monitored with all policy, operational and capacity aspects of the education-related measures included in this Operational Programme. A World Bank Social Welfare Development Project (of which the main beneficiary is the MHSW) is providing a 31 M EUR loan which the Government of the Republic of Croatia is co-financing with 14 M EUR, and for which the Swedish International Development Agency has approved the donation of 1.6 M EUR.
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The SWDP includes the three components: to improve the quality of social services and to reduce the proportion of residential care; to improve the premises of social welfare institutions; and to develop the information – operating system. Other major bilateral donors include: GTZ, Germany (€1million VET project; focusing on the 3-year VET stream, fostering schools of excellence) Kulturkontakt, Austria (projects in the tourism sector, on entrepreneurship training and the training of school managers) and DfID, UK: The project 'Strengthening Labour Market Strategies in Croatia and Service Delivery in the Croatian Employment Service' was financially supported by the British Department for International Development and under the professional leadership of experts from the British Department for International Development, Department for Work and Pensions and Department for Education and Skills. The main objective of the project was to strengthen the Social Policy Framework for the development of Croatia’s National Employment Action Plan and to support the development of the Croatian Employment Service. It consists of two components: • The development of the first National Employment Action Plan in accordance with European Employment Strategy; • Development and implementation of training and skills development programme for staff in the Croatian Employment Service. The implementation of the project started in January 2003 and finished at the end of 2004. The National Action Plan for Employment was approved by the Government of the Republic of Croatia in December 2004. Also of particular relevance are the following – Austrian Ministry of Economics and Labour, Austria: In 2006 the project 'Evaluation of Active Labour Market Policy Measures in Croatia' started. It has been financially supported by Austrian Ministry of Economics and Labour and implemented by the L&R Social Research Institute from Vienna and the Croatian Employment Service. The project will be continued in 2007 and will be closely monitored in the context of the PHARE 2005 project on 'Active Employment Measures for Groups threatened by Social Exclusion'. The Swedish National Labour Market Board, Sweden: 2-day seminar for the Croatian Employment Service staff “Swedish experiences on European Social Fund projects implementation” was delivered in May 2006. Insofar as is feasible, and to ensure complementarity of the above-mentioned donor activities with this Operational Programme, the Head of the Operating Structure, together with the relevant authorities, shall ensure that the principles of Article 9 of the IPA Implementing Regulation (coherence of implementation of assistance) are respected.
3.5 Indicative list of major projects
No major projects are envisaged under the HRD OP in accordance with the provisions of Article 157.2 of the draft IPA Implementing Regulation (i.e. requiring an IPA contribution of more than ten million euros).
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4 FINANCIAL TABLES
4.1 Calculation of Community contribution
4.1.1 MIPD indicative financial weightings (major areas of intervention)
Priority MIPD OP HRD
1. Attracting and retaining more people in employment 30-40 % 39% 2. Improving adaptability of enterprises and workers 20-30 % 0% 3. Increasing human capital investment 30-40 % 32% 4. Strengthening administrative capacity 10-20 % 19% Technical Assistance 10% Total 100-140% 100%
The above table shows an identifiable shift from the indicative allocations set out under the 'major areas of intervention' in the first MIPD. This reflects a subsequent in-depth assessment of needs in Croatia indicating that, for the MIPD major areas of intervention on
- improving the adaptability of enterprises and workers, and
- increasing human capital investment greater focus would be given in the initial phase of the programme towards further strengthening policy and operational capacity within the relevant institutions and partners as well as developing the analytical basis for the further 'roll-out' of related activity.
4.1.2 Application of Article 153 of IPA Implementing Regulation Eligible expenditure proposed for co-financing under IPA Component IV shall be based on the public expenditure in accordance with Article 153.1 of the IPA Implementing Regulation. Moreover, the Community contribution shall not exceed the ceiling of 85% of the eligible expenditure at the level of each priority axis. No operation will benefit from a higher co-financing rate than the one relating to the priority axis concerned.
4.1.3 Programme duration Within the framework of the programme duration, the Financial Tables set out hereunder will be reviewed on a rolling 3-year basis
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4.2 Financial tables
For Public expenditure information Community National IPA co- Total Public Other (IFI, Contrib. Public financing YEARS 2007 - 2009 expenditure etc) (IPA) Contrib. rate (1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1 Enhancing access to employment and sustainable inclusion in the labour market 11.176.472 9.500.000 1.676.472 85% 0 Measure 1.1 Supporting the design and implementation of active and preventative labour market policy 7.176.472 6.100.000 1.076.472 0 Measure 1.2 Supporting the effectiveness and quality of Croatia's public employment services 4.000.000 3.400.000 600.000 0
Priority Axis 2 Reinforcing social inclusion of people at a disadvantage 10.588.237 9.000.000 1.588.237 85% 0 Measure 2.1 Supporting access to employment by disadvantaged groups 8.235.296 7.000.000 1.235.296 0 Measure 2.2 Supporting access to education by disadvantaged groups 2.352.941 2.000.000 352.941 0
Priority Axis 3 Enhancing human capital and employability 18.764.706 15.950.000 2.814.706 85% Measure 3.1 Further development of the Croatian Qualifications Framework 8.294.118 7.050.000 1.244.118 0 Measure 3.2 Strengthening the provision of Adult Learning 6.000.000 5.100.000 900.000 0 Measure 3.3 Supporting the development of institutions and their partners responsible for the provision of 4.470.588 3.800.000 670.588 vocational education and training, and adult education 0
Priority Axis 4 Technical assistance 4.502.354 3.827.000 675.354 85% 0 Measure 4.1 Project preparation 2.235.295 1.900.000 335.295 Measure 4.2 Programme management and capacity-building 2.267.059 1.927.000 340.059
Total Years 2007 - 2009 45.031.769 38.277.000 6.754.769 85% 0
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For Public expenditure information Community National IPA co- Total Public Other (IFI, Contrib. Public financing YEAR 2007 expenditure etc) (IPA) Contrib. rate (1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1 Enhancing access to employment and sustainable inclusion in the labour market 4.411.765 3.750.000 661.765 85% 0 Measure 1.1 Supporting the design and implementation of active and preventative labour market policy 2.647.059 2.250.000 397.059 85% Measure 1.2 Supporting the effectiveness and quality of Croatia's public employment services 1.764.706 1.500.000 264.706 85%
Priority Axis 2 Reinforcing social inclusion of people at a disadvantage 1.764.706 1.500.000 264.706 85% 0 Measure 2.1 Supporting access to employment by disadvantaged groups 1.764.706 1.500.000 264.706 85% Measure 2.2 Supporting access to education by disadvantaged groups 0 0 0 #DIV/0!
Priority Axis 3 Enhancing human capital and employability 5.882.353 5.000.000 882.353 85% 0 Measure 3.1 Further development of the Croatian Qualifications Framework 1.764.706 1.500.000 264.706 85% Measure 3.2 Strengthening the provision of Adult Learning 1.764.706 1.500.000 264.706 85% Measure 3.3 Supporting the development of institutions and their partners responsible for the provision of 2.352.941 2.000.000 352.941 vocational education and training, and adult education 85%
Priority Axis 4 Technical assistance 1.325.883 1.127.000 198.883 85% Measure 4.1 Project preparation 588.236 500.000 88.236 85% Measure 4.2 Programme management and capacity-building 737.647 627.000 110.647 85%
Total Year 2007 13.384.707 11.377.000 2.007.707 85% 0
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For Public expenditure information Community National IPA co- Total Public Other (IFI, Contrib. Public financing YEAR 2008 expenditure etc) (IPA) Contrib. rate (1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1 Enhancing access to employment and sustainable inclusion in the labour market 3.411.765 2.900.000 511.765 85% 0 Measure 1.1 Supporting the design and implementation of active and preventative labour market policy 1.764.706 1.500.000 264.706 85% Measure 1.2 Supporting the effectiveness and quality of Croatia's public employment services 1.647.059 1.400.000 247.059 85%
Priority Axis 2 Reinforcing social inclusion of people at a disadvantage 4.117.648 3.500.000 617.648 85% 0 Measure 2.1 Supporting access to employment by disadvantaged groups 4.117.648 3.500.000 617.648 85% Measure 2.2 Supporting access to education by disadvantaged groups 0 0 0
Priority Axis 3 Enhancing human capital and employability 5.882.353 5.000.000 882.353 85% 0 Measure 3.1 Further development of the Croatian Qualifications Framework 2.235.294 1.900.000 335.294 85% Measure 3.2 Strengthening the provision of Adult Learning 1.882.353 1.600.000 282.353 85% Measure 3.3 Supporting the development of institutions and their partners responsible for the provision of 1.764.706 1.500.000 264.706 vocational education and training, and adult education 85%
Priority Axis 4 Technical assistance 1.529.412 1.300.000 229.412 85% Measure 4.1 Project preparation 705.882 600.000 105.882 85% Measure 4.2 Programme management and capacity-building 823.529 700.000 123.529 85%
Total Year 2008 14.941.178 12.700.000 2.241.178 85% 0
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For Public expenditure information Community National IPA co- Total Public Other (IFI, Contrib. Public financing YEAR 2009 expenditure etc) (IPA) Contrib. rate (1) =(2) + (3) (2) (3) (4)=(2)/(1) (Eur) (Eur) (Eur) (%) (Eur)
Priority Axis 1 Enhancing access to employment and sustainable inclusion in the labour market 3.352.942 2.850.000 502.942 85% 0 Measure 1.1 Supporting the design and implementation of active and preventative labour market policy 2.764.707 2.350.000 414.707 85% Measure 1.2 Supporting the effectiveness and quality of Croatia's public employment services 588.235 500.000 88.235 85%
Priority Axis 2 Reinforcing social inclusion of people at a disadvantage 4.705.883 4.000.000 705.883 85% 0 Measure 2.1 Supporting access to employment by disadvantaged groups 2.352.942 2.000.000 352.942 85% Measure 2.2 Supporting access to education by disadvantaged groups 2.352.941 2.000.000 352.941 85%
Priority Axis 3 Enhancing human capital and employability 7.000.000 5.950.000 1.050.000 85% 0 Measure 3.1 Further development of the Croatian Qualifications Framework 4.294.118 3.650.000 644.118 85% Measure 3.2 Strengthening the provision of Adult Learning 2.352.941 2.000.000 352.941 85% Measure 3.3 Supporting the development of institutions and their partners responsible for the provision of 352.941 300.000 52.941 vocational education and training, and adult education 85%
Priority Axis 4 Technical assistance 1.647.059 1.400.000 247.059 85% Measure 4.1 Project preparation 941.176 800.000 141.176 85% Measure 4.2 Programme management and capacity-building 705.882 600.000 105.882 85%
Total Year 2009 16.705.884 14.200.000 2.505.884 85% 0
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5 IMPLEMENTATION PROVISIONS
5.1 Management and control structures
This chapter of the operational programme describes the systems and arrangements in place at the time of the formulation of the operational programme. However, a number of follow-up decisions regarding structures and responsibilities, as well as on management and information systems, will be taken in the context of the accreditation for conferral of decentralised management, which follows a different timing from the adoption of the operational programme. To this end, the Framework Agreement, as well as the Financing Agreement to be signed after conferral of decentralised management, will set out detailed provisions regarding management and control systems. The provisions in this chapter must therefore be understood as subject to later adaptations by the applicable provisions of these agreements, where required. In the case of the Financing Agreement in particular, it will take precedence, where appropriate, over the provisions of this chapter in determining the basis under which the government of Croatia accepts the assistance provided under this operational programme. 5.1.1 Bodies and authorities Based on the IPA Implementing Regulation, the Croatian Government has adopted its own legal act/s to designate specific bodies for IPA management and implementation21. Under the provisions of this Regulation, the following individuals/bodies have been or will be designated/ established: • National IPA Coordinator • Strategic Coordinator for the regional development and the human resources development components • Competent Accrediting Officer • National Authorising Officer • National Fund • Audit Authority • Operating Structure With the exception of the Operating Structure and the role of the Strategic Coordinator, these bodies essentially perform tasks which are generally applicable to all IPA components in accordance with their functions specified in the relevant articles of the IPA Implementing Regulation. Accordingly, in line with the provisions of Article 7.3 of the afore-mentioned Regulation and as specified in the 'model' Framework Agreement adopted by the Commission on 6 July 2007 [ref C(2007) 3208 final – E/1368/2007], such functions will be incorporated under the Framework Agreement to be concluded between the Commission and the government of Croatia.
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Operating Structure This Operational Programme will be managed by the Head of the Operating Structure who will be responsible for the following functions in compliance with Article 28.2 of the IPA Implementing Regulation: • drafting the annual or multi-annual programmes; • programme monitoring and guiding the work of the sectoral monitoring committee as defined in Article 59, notably by providing the documents necessary for monitoring the quality of implementation of the programmes; • drawing up the sectoral annual and final implementation reports defined in Article 61(1) and, after their examination by the sectoral monitoring committee, submitting them to the Commission, to the national IPA co-ordinator and to the National Authorising Officer; • ensuring that operations are selected for funding and approved in accordance with the criteria and mechanisms applicable to the programmes, and that they comply with the relevant Community and national rules; • setting up procedures to ensure the retention of all documents required to ensure an adequate audit trail, in accordance with Article 20; • arranging for tendering procedures and the follow-up contracting; making payments to, and recovery from, the final beneficiary; • in the case of grant award procedures, ensuring that they are respected through a coordinated distribution of tasks between the line ministries and the implementing bodies concerned • ensuring that all bodies involved in the implementation of operations maintain a separate accounting system or a separate accounting codification; • ensuring that the National Fund and the National Authorising Officer receive all necessary information on the procedures and verifications carried out in relation to expenditure; • setting up, maintaining and updating the reporting and information system; • carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; • ensuring internal audit of its different constituting bodies; • ensuring irregularity reporting; • ensuring compliance with the information and publicity requirements.
The Operating Structure will be composed of the following specific bodies in accordance with Article 31 of the IPA Implementing Regulation: • The Ministry of Economy, Labour and Entrepreneurship (MELE), • The Ministry of Science, Education and Sports (MSES), • The Ministry of Health and Social Welfare (MHSW), • The Croatian Employment Service (CES), and • The Agency for Vocational Education and Training (AVET). The position and level of responsibility, as well as the Heads of specific bodies within the Operating Structure, are shown in the table hereunder:
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Level of Titles of the Specific bodies within the Operating Structure Responsibility bodies within the Operating Heads of specific bodies within the Operating Structure Structure
The Ministry of Economy, Labour and Entrepreneurship Body Operational Directorate for Labour and Labour Market Responsible for Programme level Department for European Integration and Project Management OP Ulica grada Vukovara 78, 10000 Zagreb
State Secretary for Labour
Priority axis 1 Priority axis 2, Priority axis 2, Priority axis 3 Priority axis 4
Measure 2.1 Measure 2.2 Body The Ministry of The Ministry of The Ministry of Priority/Measure Responsible for Economy, Labour and The Ministry of Health The Ministry of Science, Education Economy, Labour and level Priority/Measure Entrepreneurship and Social Welfare Science, Education and Sports- Entrepreneurship Directorate for Labour Directorate of Social and Sports- Directorate for Directorate for Labour and Labour Market Welfare Directorate for Secondary Education and Labour Market Department for Department for Secondary Education Department for European Integration Humanitarian Aid and Trg hrvatskih velikana European Integration and Project Cooperation with Civil Trg hrvatskih velikana 6, 10 000 Zagreb and Project Management Society Organizations 6, 10 000 Zagreb Management State Secretary for Ulica grada Vukovara Ksaver 200 A State Secretary for Secondary Education Ulica grada Vukovara 78, 10000 Zagreb 10000 Zagreb Secondary Education 78, 10000 Zagreb
State Secretary for State Secretary for State Secretary for Labour Social Welfare Labour
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The Croatian Employment Service The Agency for Vocational Education The Croatian Implementing Department for Contracting and Financing and Training Employment Service Body Project/operation level Department for Financing and Contracting of IPA Department for (Contracting Radnička cesta 1, 10000 Zagreb Contracting and Authority) Ulica grada Chicaga 21, 10000 Zagreb Financing Director Radnička cesta 1, Director 10000 Zagreb
Director
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The State Secretary for Labour will act as the Head of Operating Structure in the meaning of Article 167 (3) of the IPA Implementing Regulation. Any personnel changes in the Heads of the specific bodies referred to above will be notified to the Commission, as appropriate, including any changes which affect the accreditation of the Operating Structure and the Commission's subsequent conferral of management powers. Distribution of functions
The Ministry of Economy, Labour and Entrepreneurship (as a Body responsible for OP) bears overall responsibility for the management of the Operational programme and executes the following functions in relation to the Operational Programme as a whole:
• Coordination of the Operational Programme preparation and its adjustments;
• Coordination of programme monitoring in accordance with the provisions of Article 59 of the IPA Implementing Regulation;
• Coordination of the preparation of sectoral annual and final reports in accordance with the provisions of Article 169 of the IPA Implementing Regulation;
• Setting up procedures for retention of all documents to ensure a sufficiently detailed audit trail (Article 20 of IPA Implementing Regulation);
• Organisation of interim evaluation during the period of programme implementation, in cooperation with CODEF;
• Setting up, maintaining and updating the reporting and information system; • Ensuring that all bodies involved in the implementation of operations maintain a separate accounting system or a separate accounting codification; • Ensuring that the National Fund and the National Authorising Officer receive all necessary information on the procedures and verifications carried out in relation to expenditure;
• Ensuring internal audit of its different constituting bodies;
• Ensuring irregularity reporting;
• Ensuring risk management reporting;
• Ensuring compliance with the information and publicity requirements.
In relation to Priority Axis 1 – Enhancing Access to Employment and Sustainable Inclusion in the Labour Market and Priority Axis 4 – Technical Assistance, the Ministry of Economy, Labour and Entrepreneurship (as a Body responsible for Priority/Measure) will also specifically execute the following tasks:
• Preparation of the sections of the Operational Programme within its sectoral area of responsibility;
• Preparation of monitoring data/reports within its sectoral area of responsibility;
• Preparation of relevant sections of sectoral annual and final reports, within its area of responsibility; • Ensuring that all the relevant information is available to ensure at all times a sufficiently detailed audit trail.
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• Identification of the intended final beneficiaries, the expected selection modalities and possible related specific selection criteria (Article 155 of IPA Implementing Regulation); • Ensuring that operations within their sectoral area of responsibility are selected for funding and approved in accordance with criteria applicable to the OP;
• In its capacity as a beneficiary, assistance in the technical preparation and management of the projects on the basis of formal agreements with the implementing body (preparation of tender documentation/guidelines to applicants, participation in evaluation, verification of delivered outputs, on-the-spot checks, technical monitoring);
• Submission to the National Fund of a request for payment and all supporting documents; • Preparation and submitting all necessary information on the procedures and verifications carried out in relation to expenditure; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail;
• Internal audit;
• Irregularity reporting;
• Risk management reporting; • Compliance with the information and publicity requirements.
In relation to Priority Axis 2 – Reinforcing Social Inclusion of People at a Disadvantage (Measure 2.1: Supporting access to employment by disadvantaged groups) the Ministry of Health and Social Welfare (as a Body responsible for Priority/Measure) will execute the following functions:
• Preparation of the sections of the Operational Programme within its sectoral area of responsibility;
• Preparation of monitoring data/reports within its sectoral area of responsibility;
• Preparation of relevant sections of sectoral annual and final reports, within its area of responsibility; • Ensuring that all the relevant information is available to ensure at all times a sufficiently detailed audit trail. • Identification of the intended final beneficiaries, the expected selection modalities and possible related specific selection criteria (Article 155 of IPA Implementing Regulation); • Ensuring that operations within their sectoral area of responsibility are selected for funding and approved in accordance with criteria applicable to the OP;
• In its capacity as a beneficiary, assistance in the technical preparation and management of the projects on the basis of formal agreements with the implementing body (preparation of tender documentation/guidelines to applicants, participation in evaluation, verification of delivered outputs, on-the-spot checks, technical monitoring);
• Submission to the National Fund of a request for payment and all supporting documents; • Preparation and submitting all necessary information on the procedures and verifications carried out in relation to expenditure; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail;
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• Internal audit;
• Irregularity reporting;
• Risk management reporting; • Compliance with the information and publicity requirements.
In relation to Priority Axis 2 – Reinforcing Social Inclusion of the People at a Disadvantage (Measure 2.2: Supporting access to education by disadvantaged groups) and Priority Axis 3 – Enhancing Human Capital and Employability, the Ministry of Science, Education and Sports (as a Body responsible for Priority/Measure) will execute the following functions:
• Preparation of the sections of the Operational Programme within its sectoral area of responsibility;
• Preparation of monitoring data/reports within its sectoral area of responsibility;
• Preparation of relevant sections of sectoral annual and final reports, within its area of responsibility; • Ensuring that all the relevant information is available to ensure at all times a sufficiently detailed audit trail. • Identification of the intended final beneficiaries, the expected selection modalities and possible related specific selection criteria (Article 155 of IPA Implementing Regulation); • Ensuring that operations within their sectoral area of responsibility are selected for funding and approved in accordance with criteria applicable to the OP;
• In its capacity as a beneficiary, assistance in the technical preparation and management of the projects on the basis of formal agreements with the implementing body (preparation of tender documentation/guidelines to applicants, participation in evaluation, verification of delivered outputs, on-the-spot checks, technical monitoring);
• Submission to the National Fund of a request for payment and all supporting documents; • Preparation and submitting all necessary information on the procedures and verifications carried out in relation to expenditure; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail;
• Internal audit;
• Irregularity reporting;
• Risk management reporting; • Compliance with the information and publicity requirements.
In relation to Priority Axis 1 – Enhancing Access to Employment and Sustainable Inclusion in the Labour Market, to Priority Axis 2 – Reinforcing Social Inclusion of People at a Disadvantage (Measure 2.1: Supporting access to employment by disadvantaged groups) and Priority Axis 4 – Technical Assistance, the Croatian Employment Service (as the Implementing Body) will execute the following functions:
• Verification of tender documents/guidelines for calls for proposals received from beneficiary institutions and preparation of complete tender dossier/application package;
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• Arranging for tendering procedures and contract award procedures;
• Acting as the Contracting Authority;
• Contract implementation;
• Preparation and submission of payment claims to the body responsible for measure/priority;
• Making payments to, and recovery from, the final beneficiary;
• Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate; • Support in preparation of documents for the sectoral monitoring committee on progress made towards achieving targets of the measures;
• Support in the preparation of sectoral annual and final implementation reports;
• Maintaining a separate accounting system or a separate accounting codification; • Internal audit; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail;
• Irregularity reporting. In relation to Priority Axis 2 – Reinforcing Social Inclusion of People at a Disadvantage (Measure 2.2.: Supporting access to education by disadvantaged groups) and Priority Axis 3 – Enhancing Human Capital and Employability, the Agency for Vocational Education and Training (as the Implementing Body) will execute the following functions:
• Verification of tender documents/guidelines for calls for proposals received from beneficiary institutions and preparation of complete tender dossier/application package;
• Arranging for tendering procedures and contract award procedures;
• Acting as the Contracting Authority;
• Contract implementation;
• Preparation and submission of payment claims to the body responsible for measure/priority;
• Making payments to, and recovery from, the final beneficiary;
• Ensuring that the body/ies responsible for priority/measure receive(s) all necessary information on the procedures and verifications carried out in relation to expenditure; • Carrying out verifications to ensure that the expenditure declared has actually been incurred in accordance with applicable rules, the products or services have been delivered in accordance with the approval decision, and the payment requests by the final beneficiary are correct. These verifications shall cover administrative, financial, technical and physical aspects of operations, as appropriate;
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• Support in preparation of documents for the sectoral monitoring committee on progress made towards achieving targets of the measures;
• Support in the preparation of sectoral annual and final implementation reports;
• Maintaining a separate accounting system or a separate accounting codification; • Internal audit; • Retention of all documents and ensuring that all the relevant information is available to provide for a sufficiently detailed audit trail;
• Irregularity reporting.
All the bodies within the Operating Structure are ultimately accountable to the Ministry of Economy, Labour and Entrepreneurship which bears overall responsibility for the Operational Programme management, for the execution of their specific tasks in relation to this Operational Programme.
A detailed organigramme of the Operational Programme management system is provided in Annex 6.
5.1.2 Separation of functions In accordance with the Article 21.2 of the IPA Implementing Regulation, the appropriate segregation of duties will be ensured between and within the designated bodies. Separation of functions between the bodies The separation of functions results from a division of tasks as described above and will incorporate the following principles: • on the one hand, a clear separation between verifications, controls, and evaluations to be carried out by the Operating Structure and by the National Fund; and on the other • a clear separation between the audits carried out by the Audit Authority and the implementation and payment procedures. Separation of functions within the bodies The organizational structure of the bodies and their internal management and control procedures will take into account all requirements to ensure a proper separation of functions. This includes the following principles: • before an operation is authorized, the operational and financial aspects shall be verified by members of staff other than those responsible for initiation or implementation of the operation; • certificates of statement of expenditure shall be drawn up by a person or department within the National Fund who is functionally independent from any services that approve claims; • initiation, ex-ante, and ex-post controls are separate functions, to be carried out by different persons, functionally independent from each other.
5.2 Monitoring and evaluation
5.2.1 Monitoring arrangements In order to ensure coherence and coordination in the implementation of the IPA components, programmes and operations as well as to follow the progress in the implementation of IPA assistance, the following monitoring committees will be established: IPA Monitoring Committee; Sectoral Monitoring Committee for the Human Resources Development Operational Programme.
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IPA Monitoring Committee Croatia will establish an IPA Monitoring Committee to ensure coherence and coordination in the implementation of all five Components of IPA. Sectoral Monitoring Committee The Head of the Operating Structure for Human Resources Development Programme will establish a Sectoral Monitoring Committee within 6 months after the entry into force of the IPA Implementing Regulation. The Sectoral Monitoring Committee will be co-chaired by the State Secretary for Labour of the Ministry of Economy, Labour and Entrepreneurship, as Head of the Operating Structure for the Human Resources Development Operational Programme, and a representative of the Commission. Its members will include: • The National IPA Coordinator or his/her representative; • The National Authorising Officer or his/her representative; • A representative of the Commission; • The Strategic Coordinator for Components III and IV or his/her representative; • Head of National Fund or his/her representative; • Representatives of each body of the Operating Structure for the programme: The Ministry of Economy, Labour and Entrepreneurship, the Ministry of Science, Education and Sports, the Ministry of Health and Social Welfare, the Croatian Employment Service, the Agency for Vocational Education and Training; • A representative of the Government Office for Gender Equality; • Representatives from the civil society and socio-economic partners, regional or national organisations with an interest in and contribution to make to the effective implementation of the programme. These will include representatives of the Council for the Development of the Civil Society as well as representatives of trade unions and employers' organizations that will be selected through the Economic and Social Council. The composition of the Sectoral Monitoring Committee can be reviewed and extended by the Head of the Operating Structure in agreement with the Commission in order to guarantee sufficient representation and membership. The Sectoral Monitoring Committee will be assisted by a permanent secretariat provided by the Operating Structure for the preparation of papers for discussion by the committee or for clearance by written procedure. The Secretariat of the Sectoral Monitoring Committee will be placed within the relevant department of the Operating Structure established in the MELE. The Sectoral Monitoring Committee will report to the IPA Monitoring Committee. Its tasks will include to: • consider and approve the general criteria for selecting the operations and approve any revision of those criteria in accordance with programming needs; • review at each meeting progress towards achieving the specific targets of the operational programme on the basis of documents submitted by the operating structure; • examine at each meeting the results of implementation, particularly the achievement of the targets set for each priority axis and measures and interim evaluations, it shall carry out this monitoring by reference to the indicators agreed; • examine the sectoral annual and final reports on implementation, including OP summary tables; • inform itself of the annual audit activity report or of the part of the report referring to the operational programme; • examine any proposal to amend the financing agreement of the programme and propose to the operating structure any revision or examination of the programme likely to make possible the attainment of the programme's objectives or to improve its management, including its financial management, as well as to oversee the cross cutting themes and publicity measures.
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The Sectoral Monitoring Committee shall confirm or make proposals to the Head of the Operating Structure, to the Commission, the Strategic Co-ordinator and the National IPA Co-ordinator to revise the programme where relevant following an evaluation, including its results as well as output and financial indicators used to monitor the assistance. The Sectoral Monitoring Committee will set up its rules of procedure in agreement with the Operating Structure and the IPA Monitoring Committee. It will meet at least twice a year and upon request by the Commission. Intermediate meetings may also be convened as required. As a principle, the Sectoral Monitoring Committee will aim to take decisions by reaching consensus.
5.2.2 Management Information System The Head of the Operating Structure is responsible for the efficiency and correctness of management and implementation and in particular for setting up, maintaining and updating regularly a reporting and information system to gather reliable financial and statistical information on implementation, for the monitoring indicators and for evaluation and for forwarding this data in accordance with arrangements agreed between the NIPAC and the Commission.
This system will be developed into one or several computerised system(s), in a form chosen by the Operating Structure and NIPAC, which will enable it to: • monitor and manage the implementation of operations and projects, from the moment of tendering and call for proposal to the closure of the OP, in particular results whenever feasible and outputs; • carry out and monitor financial transactions; • ensure the reporting requirements on the implementation of the OP. The Operating Structure and all other bodies involved in the implementation of the OP shall have access to this system(s).
The Management Information System will be developed under the Technical Assistance component of this Operational Programme. The establishment of the Management Information System will be done under the guidance and supervision of NIPAC and Strategic Coordinator, in order to ensure consistency and complementarity across all the Operational Programmes. Until the system becomes operational, reporting and collection of data will be done manually.
5.2.3 Monitoring System and Indicators The quantitative and qualitative progress made in implementing the programme as well as its efficiency and effectiveness in relation to its objectives will be measured by the use of evaluation and monitoring indicators related to the results and outputs of the individual measures. In identifying appropriate monitoring and evaluation indicators, account has been taken of the methodologies, guidelines and lists of examples of indicators issued by the Commission, in particular the 'Indicative guidelines on evaluation methods: Monitoring and evaluation indicators' (August 2006, working document No. 2 for the programming period 2007-2013). The Head of the Operating Structure is responsible for programme monitoring. In this context, the Operating Structure will collect performance data (outputs, results and expenditure) from operations and projects. It will establish, maintain and update the reporting and information system by taking this project-level data and aggregate it to measure, priority axis and whole OP levels. Data on individuals who are the ultimate beneficiaries must be collected for each project and used for aggregation at measure and priority level. On this basis, the Operating Structure will assess the progress of the OP at each level against objectives and targets, prepare reports to the Sectoral Monitoring Committee, draft the sectoral annual and final reports on implementation and to launch interim evaluations if required. These reports should include detailed summary table for the Operational Programme. In the context of monitoring and for the purpose of using indicators, the role of the Operating Structure will also be to ensure that:
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• monitoring requirements are built into the calls for tender and proposals documents (application forms and guidelines for applicants); • project applications (when appraised and selected) include proposed outputs and results, as well as data on individuals, that are consistent with the OP indicators for the appropriate measure; • provision of data is built into the contract with beneficiaries as an obligation, and that performance data is provided systematically and in a timely manner by beneficiaries alongside the project reimbursement claim.
An indicative breakdown by category of the programmed use of the Community contribution to this operational programme will be established for monitoring and information purposes while the sectoral annual and final reports on implementation will provide information on the use of expenditure in accordance with such categories.
5.2.4 Selection of operations All service, supply, works and grant contracts shall be awarded and implemented in accordance with the rules for external aid contained in the relevant Articles of the Financial Regulation (as amended under Council Regulation 1995/2006 of 13 December 2006)) and in accordance with the 'Practical Guide to contract procedures for EC external actions' ('Practical Guide') as published on the EuropeAid website22 at the date of the initiation of the procurement or grant award procedure. The standard templates and models provided for in the Practical Guide will be used in order to facilitate the application of the applicable rules. All operations which are not major projects and which are implemented by final beneficiaries other than national public bodies shall be selected through calls for proposals. The Operating Structure will set up a Selection Committee for each call for proposals launched for the selection of operations financed under a specific measure. The Selection Committee will appraise project applications in compliance with the selection criteria and methodologies agreed by the Sectoral Monitoring Committees and published in the call for proposal documents. Applications will first be 'screened' for their compliance with eligibility and administrative criteria in order to fulfil the relevant eligibility requirements set out in the relevant measures (completeness, accuracy, etc) and will thereafter be evaluated according to their overall quality. The Selection Committee will then make recommendations to the Operating Structure, in compliance with Article 158 of the IPA Implementing Regulation. Members of the Selection Committee will be the most appropriate officials and experts with the necessary technical competence to undertake a qualitative appraisal of project applications. Procurement will follow the provisions of Part Two, Title IV of the Financial Regulation 1605/2002 (as amended by Council Regulation 1995/2006) as well as Part Two, Title III of Commission Regulation No 2342/2002 (as amended by Regulation 478/2007) laying down detailed rules for its implementation. For the purposes of '3rd country' cooperation financed from the General Budget of the European Communities, procurement will also respect the rules and procedures for service, supply and works contracts as adopted by the Commission on 24 May 2007 [C(2007) 2034] as well as Article 23 (Rules on Procurement) of the 'model' Framework Agreement which was also adopted by the Commission on 6 July 2007 [C(2007) 3208 final – E/1368/2007]. In the case of all Tender Selection Committees which are established for the evaluation of service, works and supply tenders, their decision-making process will adhere, as required, to the procurement and grant award procedures set out above. All grant-award procedures will follow the provisions of Part One, Title VI of the afore-mentioned Financial Regulation (as amended). All beneficiaries (whether public or private) will also comply with the principles established under the relevant rules of the 'Practical Guide'.
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5.2.5 Sectoral annual and final reports on implementation Sectoral annual and final reports on implementation will be prepared by the Operating Structure in accordance with Article 169 of the IPA Implementing Regulation. These reports will assess the implementation progress covering the attainment of set objectives, the problems encountered in managing the programme and the measures taken, the financial execution as well as monitoring and evaluation activities carried out. Programmes will include an up-to-date OP summary table and will be reviewed at least at the 'second meeting' of the Sectoral Monitoring Committee each year.
5.2.6 Evaluation arrangements Evaluations are a tool for assessing the relevance, efficiency and effectiveness of the financial assistance as well as the impact and sustainability of the expected results. As a minimum, an ex ante evaluation and an interim evaluation will be carried out under the responsibility of the Head of the Operating Structure in accordance with the principles laid down in the IPA Implementing Regulation and guidance provided by the Commission. The evaluation arrangements and activities of each programme will fully respect the principle of proportionality. Ex ante evaluation Under the responsibility of the Operating Structure, an ex ante evaluation of the Human Resources Development Operational Programme has been carried out by the European Policy Research Centre at the University of Strathclyde in Glasgow and is annexed to the programme. A summary of the results of the ex- ante evaluation, and the way the evaluation was conducted, is set out in section 1.3.2. Interim evaluation During the implementation of the programme, interim evaluations complementing the monitoring of the Environment Protection Operational Programme will be carried out, in particular where this monitoring reveals a significant departure from the goals initially set or where proposals are made for the revision of the programme. At any rate, evaluations are planned to provide data on indicators agreed upon in the OP that cannot be obtained through the monitoring system In addition, strategic evaluations or thematic evaluations can be carried out under the responsibility of the Operating Structure and/or CODEF. The results will be sent to the ad-hoc committee on evaluations, to the Sectoral Monitoring Committee and to the Commission. Evaluation function The Head of the Operating Structure is responsible for ensuring that adequate evaluations of the Operational Programme are carried out. The evaluations will be carried out by external experts, functionally independent from the management and control system. The evaluations will be managed by a designated official within the Ministry of Economy, Labour and Entrepreneurship, who will be responsible for preparing the documents for tendering and contracting these experts under Priority Axis 4, reviewing the draft evaluation reports, acting as secretariat to the ad-hoc Evaluation Committee and liaising as appropriate between the selected experts and the said Committee. Evaluation committee The Sectoral Monitoring Committee will designate an ad-hoc Committee to assist the operating structure in its evaluation activities. The Committee will adhere to the 'partnership principle' and will include members (and invitees where relevant) who are experts in evaluation. Moreover, the assistance of the Committee will be availed of at all stages of the process (including guidance, planning, implementation and communication of results) in order to ensure the overall quality of the evaluations undertaken. At the same time, all relevant stakeholders and institutions/organisations will be invited to contribute where appropriate. The designation and establishment of this ad-hoc Committee will be made in accordance with the Sectoral Monitoring Committee's rules of procedures adopted in accordance with Article 167.2 of the IPA Implementing Regulation.
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Evaluation activities and timing Given that this programme covers the period 2007-09 but involves operational activity up to 31 December 2012 under the 'N+3 rule', only one interim evaluation will be carried out which will commence in October 2009. This would be effectively a process evaluation examining the efficiency and effectiveness of programme and project implementation, but within the context of the progress made with implementation, including the performance against indicators at the project level (physical and financial objects) and at the measure level (outputs). This will also include a review of performance on the horizontal themes of the OP. The evaluation process will make use of the indicators defined for the purpose of monitoring the programme operations. As the management information system does not yet exist and is due to be established through the Technical Assistance priority axis of this operational programme, project monitoring reports and other sources of data [such as databases of different institutions responsible for the management of the OP (e.g. Croatian Employment Service) or reports provided by different stakeholders in the process] will be used for programme monitoring and evaluation in the first phase of its implementation. These reports and sources of data will be supported, where appropriate, by other evaluative work including placement follow-up. Moreover, particular use will be made of result indicators defined at the level priority axes as well as the corresponding sources of data identified in section 3.2. for result indicators (mediation/human resources/IT database of the Croatian Employment Service, databases of the Central Bureau of Statistics). Specific surveys may be commissioned through the Technical Assistance component to inform the evaluation process.
5.3 Information and publicity
5.3.1 Introduction Information and publicity are important aspects of pre-accession assistance and in particular to the successful design and delivery of this operational programme, given the partnership basis on which they are undertaken. Communicating for a successful management and implementation of the operational programme are broken down into a series of information and publicity activities. To this end, Article 62 of the IPA Implementing Regulation sets out certain requirements regarding the information to be provided and publicity of programmes and operations financed by the Community, addressed to citizens and beneficiaries with the aim of highlighting the role of Community funding and ensuring transparency. Accordingly, the information to be provided by the Operating Structure will include inter alia the publication of the list of final beneficiaries, the names of the operations and the amount of Community funding allocated to operations. For its part, the Commission will also ensure the publication of the relevant information on tenders and contracts in the official Journal of the European Union and other relevant media and websites. Moreover, in accordance with Article 63 of the IPA Implementing Regulation provides that the Commission and the relevant authorities of the beneficiary country will agree on a coherent set of activities, to be funded from the Technical Assistance priority of this operational programme, in order to make available and publicise information about IPA assistance. In accordance with the above-mentioned provisions, the Ministry of Economy, Labour and Entrepreneurship's Public Relations and Information Department (Section for Information and Publicity of IPA components III and IV within the Cabinet of the Minister) will be responsible for the information and publicity activities under the programme. The information will be addressed to the citizens of Croatia and to the European citizens in general, and to the (potential) beneficiaries. It will aim to highlight the role of the Community and ensure that IPA component IV assistance is transparent.
5.3.2 Requirements In compliance with Article 63 of the IPA Implementing Regulation, the Ministry of Economy, Labour and Entrepreneurship's Public Relations and Information Department – Section for Information and Publicity IPA
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components III and IV - will formulate a coherent set of strategic activities (communication action plan) to publicize information about IPA including assistance under component IV. The CAP shall be consistent with the information and publicity strategy issued by NIPAC. The CAP shall cover the period 2008-2012. The Ministry of Economy, Labour and Entrepreneurship's Public Relations and Information Department – Section for Information and Publicity IPA components III and IV - will submit a draft of the plan to the Commission within four months of the date of signature of the Financing Agreement covering this operational programme. As a minimum, the plan shall include its: • aims and intended target groups; • strategy and content; • indicative budget; • administrative support structure and • criteria used for evaluation of project proposals.
5.3.3 Activities The Ministry of Economy, Labour and Entrepreneurship's Public Relations and Information Department – Section for Information and Publicity IPA components III and IV - will ensure that the information and publicity measures are implemented in accordance with the communication action plan aiming at the broadest possible media coverage using all suitable forms and methods of communication at the appropriate territorial level. The Information and Publicity Section will also be responsible for organizing at least the following information and publicity measures: • a major information activity publicizing the launch of the Operational Programme, even in the absence of the final version of the communication action plan; • at least one major information activity a year, as set out in the communication action plan, presenting the achievements under the Operational Programme (including major projects where appropriate); • the publication (electronically or otherwise) of the list of beneficiaries, the names of the operations and the amount of Community and national funding allocated to the operations The Section will further provide potential beneficiaries with clear and detailed information on at least the following: • the possibility of financing opportunities offered jointly by the Community and the beneficiary country through the OP; • the conditions of eligibility to be met in order to qualify for financing under the Operational Programme; • a description of the procedures for examining applications for funding and of the time periods involved; • the criteria for selecting the operations to be financed, and • the contacts at national, regional or local level that can provide information on the Operational Programme.
5.3.4 Indicative budget The indicative budget for the communication action plan under this Operational Programme for the period 2007-2009 will be set at an appropriate level in order to provide adequate cover for the costs of the publicity and information measures. The budget allocation per year, as well as the indicative amounts necessary for the period 2010-2013, will also be presented in the communication action plan.
5.3.5 Management and implementation Within the Ministry of Economy, Labour and Entrepreneurship, information and communications will be assigned to the Section referred to under sections 5.3.2 and 5.3.3 above. The information and publicity team will be composed of 2 officials whose tasks will involve supporting the Head of the Operating Structure in the performance of the following functions and responsibilities: • discuss the communication action plan with the Commission and NIPAC;
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• coordinating the information and publicity activities under other IPA-funded programmes; • communications with the media; • elaboration, implementation and assessment of the programme's communication action plan; • represent the programme in the relevant national and Commission information networks; • handling enquiries from beneficiaries; • monitoring and control on the fulfilment of the P and I requirements from the beneficiaries; • development, production and distribution of information materials; preparation and implementation of public events; • development and maintenance of the contents of programme website; • liaison with IT regarding technical maintenance; • management of out-sourced services; • elaboration and monitoring annual communication action plans and coordination of internal events and training. Given that some of the information and publicity measures will require out-sourcing for professional services (such as design and pre-print, web page, printing, advertising, photography and opinion pools), it will be the responsibility of the information and publicity team to manage such services and ensure they are contracted in accordance with public procurement rules.
5.3.6 Monitoring, evaluation and reporting Monitoring, evaluation and reporting are compulsory requirement for the implementation of the publicity measures included into the communication action plan of the programme. The progress made in the implementation of the plan will be reported during the meetings of the Sectoral Monitoring Committee. Moreover, the Head of the Operating Structure will inform the Sectoral Monitoring Committee of the information and communication measures carried out and the means of communication used. The Head of the Operating Structure will also provide the Sectoral Monitoring Committee with examples of communication measures carried out. The annual and final reports on implementation of the Operational Programme will include the following information: • examples of information and communication measures for the Operational Programme undertaken in implementation of the communication action plan; • the arrangements for the information and publicity measures concerning the publication electronically or otherwise of the list of beneficiaries, the names of the operations and the amount of public funding allocated to the operations; • the content of major amendments to the communication action plan. • the set of indicators for evaluation of the publicity measures which have been included in the communication action plan to assess the efficiency and effectiveness of the implemented publicity activities. • the yearly results of the qualitative and quantitative analysis which have been used for the elaboration of the annual communication action plans including any modifications thereof.
5.3.7 Partnership and networking Bodies that can act as relays for the programme and disseminate the information concerning the general public will include the following: • professional and trade associations and organizations; • economic and social partners; • non-governmental organisations;
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• educational institutions; • organisations representing business; • operators; • information centres on Europe and Commission representations in particular the EC Delegation; • other main stakeholders under each priority axis. The Operating Structure will work in close cooperation with the above-mentioned bodies for the dissemination of information regarding the programme and in particular the IPA pre-accession assistance strategy for component IV.
5.3.8 Internet The website of the programme will be linked to the CODEF, MF, ECD, DG ELARG, DG EMPL and DG REGIO websites and with the websites of the other programmes. It will be created according to the following principles: • Accessibility to as many users as possible – ensuring the site has a simple address; registering it on main search engines so it can be found easily; designing it to be viewable with low specification screens and software; ensuring it is quick to download; • Prioritizing fast access to rich information – the site should be clearly organized so users can find what they are looking for quickly and easily; the information should be available as downloadable PDF documents, where possible; • Visual appeal – strong visual identity through logos, use of colours etc. without limiting the clarity, speed and simplicity; • Developing as an ongoing resource; • Interactive content, exploiting the unique strengths of websites.
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Annex 1: Membership of Inter-Ministerial Working Group23
Central Office for Development Strategy and Coordination of EU Funds (CODEF): Ms Nataša Mikuš, Deputy State Secretary Ms Suzana Kovačević, Expert Assistant Ms. Ana Šimunić, Expert Assistant Ms. Ivana Zdelarec, Trainee
Ministry of Economy, Labour and Entrepreneurship (MELE)*: Ms Vera Babić, State Secretary for Labour Ms Inga Žic, Head of Department Ms. Katarina Ivanković-Knežević, Head of Division Ms. Snježana Tomašević, Adviser
Croatian Employment Service (CES): Ms. Nada Kerovec, Head of Section Ms. Sanja Mesarov, Adviser
Ministry of Science, Education and Sport (MSES): Ms Mihaela Dubravac Šigir, Expert Advisor Ms Antonija Gladović, Head of Project Implementation Unit
Agency for Vocational Education (AVET): Ms. Jelena Letica, Head of Office
Education and Teacher Training Agency (ETTA): Ms. Nevenka Lončarić-Jelačić, Expert Advisor
Agency for Adult Education (AAE): Ms. Anita Leko, Expert Assistant
Ministry of Health and Social Welfare (MHSW): Ms Mirjana Radovan, Expert Advisor
Central Bureau of Statistics (CBS): Ms. Jadranka Brkić, Head of Section Ms. Tihana Cukina, Expert Advisor
Ministry of Foreign Affairs and European Integration (MFAEI): Ms Diana Štrkalj, Expert Assistant Ms Franka Maček, Expert Assistant
CARDS 2003: Support to National Development Planning: Mr Conor Kearney
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Annex 2: Attendance at the partner consultation under the OP for IPA Component IV
Partner consultation - Development of the Human Resources, 23 March 2007 in Zagreb Vera Babić, MELE, Želimir Janjić, MSES; Dorica Nikolić, Mirjana Radovan, MHSW; Ivan Šutalo, AVET Zorislav Bobuš, Association of Organisation of Disabled Persons in Croatia Sanja Crnković Pozaić, CEPOR; Marina Dimić Vugec, CERANEO; Dubravka Matić, Office for the Social Partnership; Branka Kranjac, Fund for Professional Rehabilitation and Employment of the Disabled People; Jasenka Matković, Croatian Association for Education of Adults; Boris Feis, SSSH; Nikola Vrdoljak , Marija Vukelić , APIU; Jozo Ćavar, Anita Leko, AAE; Antonija Gladović, MHSW; Jelena Letica, AVET; Ivica Lovrić, Association of High school Directors; Diana Štrkalj, MFAEI; Dragan Knežević, CODEF; Vedrana Ligutić, DEC; Tamara Šterk, Office for Gender Equality; Sanja Cesar, CESI; Mirela Lekić, Croatian Chamber of Crafts; Vesna Štefica, Croatian Chamber of Economy; Sanja Špoljarić, CODEF; Goran Bakula,, Ana Kranjac, Independent Trade unions; Maja Vehovec, Institute of Economy; Ivan Vrdoljak, Council of Croatian Trade Unions; Thomas Farnell, Ninoslav Šćukanec, Institute for education development; Ivana Zdelarec, Ana Šimunić, Suzana Kovačević, CODEF; Inga Žic, Snježana Tomašević, Katarina Ivanković Knežević, MELE.
Written comments were received from: Institute for the Development of Education Croatian Chamber of Crafts and Trade Croatian Chamber of Economy Association of Organisation of Disabled Persons in Croatia Trade and Investment Promotion Agency SMEs and Entrepreneurship Policy Centre
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Annex 3: Analytical tables and data
Table 1: Basic macroeconomic indicators for Croatia
2000 2001 2002 2003 2004 2005 2006
Population, mln 4,381 4,437 4,443 4,442 4,439 4,442 4,441 Gross domestic product, % annual change (real) 2.9 4.4 5.6 5.3 4.3 4.3 4.8 Gross domestic product, market prices (current), mln kunas 152,519 165,639 181,231 198,422 214,983 231,349 250,590 Gross domestic product, market prices (current)*, mln euros 19,976 22,170 24,467 26,230 28,677 31,260 34,220 Gross domestic product per capita in euros 4,560 4,997 5,507 5,905 6,460 7,037 7,704 Consumer price index, annual change, % 4.6 3.8 1.7 1.8 2.1 3.3 3.2 Average net monthly salary (in kunas) 3,326 3,541 3,720 3,940 4,173 4,376 4,603 ILO Unemployment rate, annual average, % 16.1 15.8 14.8 14.3 13.8 12.7 11.2 General government debt % GDP (ep) N.A. N.A. 40 40.9 43.2 43.7 40.8 Average exchange rate EUR/HRK 7.63 7.47 7.41 7.56 7.5 7.4 7.32 Current account deficit (% of GDP)e -2.4 -3.6 -8.5 -7.1 -5.1 -6.4 -7.8 External debt (% of GDP) (ep) 61.4 61.4 61.9 75.8 80.0 82.4 85.3 Tourist nights, annual change, % 47 11 3 4 2 7.6 3.1 Growth rate of construction works 9.1 3.6 12.8 22.8 2 -0.8 9.3 Industrial production, annual change, % 1.7 6 5.4 4.1 3.7 5.1 4.5 Retail trade, annual change (real), % 14.4 10 12.5 3.7 2.6 2.8 2.1 ep - end period Sources: Central Bureau of Statistics, Ministry of Finance, Croatian National Bank * Calculated by applying the average annual exchange rate (HRK/1 EUR) to the GDP in kuna terms.
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Table 2: Population Data for Croatia, 2000-05 Year Live births Deaths Natural increase Immigration Emigration Net immigration Population estimation 2000 43,746 50,246 -6,500 29,389 5,953 23,432 4,381,000 2001 40,993 49,552 -8,559 24,415 7,488 16,927 4,437,000 2002 40,094 50,569 -10,475 20,365 11,767 8,598 4,443,000 2003 39,668 52,575 -12,907 18,455 6,534 11,921 4,442,000 2004 40,307 49,756 -9,449 18,383 6,812 11,571 4,439,000 2005 42,492 51,790 -9,298 14,230 6,012 8,218 4,442,000 Source: Croatian Bureau of Statistics (CBS)
Table 3: Basic demographic indicators, 2006 Crude rate Crude rate Crude birth Crude death of natural of net rate rate increase migration Croatia 9.566 11.659 -2.093 1.85 Bulgaria 9.609 14.734 -5.125 : Czech Republic 10.306 10.17 0.135 3.381 Denmark 11.952 10.203 1.748 1.833 Germany (including ex-GDR from 1991) 8.194 10.015 -1.821 0.279 Greece 9.958 9.44 0.518 3.588 Spain 10.766 8.386 2.381 14.243 France 13.148 8.404 4.744 1.481 Hungary 9.915 13.058 -3.143 1.894 Netherlands 11.321 8.282 3.04 -1.916 Austria 9.407 8.97 0.437 2.883 Poland 9.812 9.693 0.12 -0.947 Portugal 9.953 9.632 0.322 2.466 Romania 10.167 11.956 -1.789 -0.3 Slovenia 9.437 9.021 0.416 3.081 Slovakia 9.998 9.886 0.112 0.715 Finland 11.173 9.127 2.046 1.964 Sweden 11.664 10.041 1.623 5.599 Cyprus 11.332 6.611 4.721 10.973 Malta 9.588 7.937 1.651 2.48 Estonia 11.073 12.888 -1.815 : Lithuania 9.212 13.203 -3.992 -1.431 Latvia 9.731 14.466 -4.735 -1.071 Source: Eurostat and CBS
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Table 4: Age structure of the population by gender, 2006 Total Women Men 15-24 25-49 50-64 65+ Up to 15 15-24 25-49 50-64 65+ Up to 15 15-24 25-49 50-64 65+ Croatia 13.17 35.33 18.74 16.85 14.97 12.45 34.00 13.29 19.91 16.94 13.95 36.76 18.80 13.55 EU - 27 13.23 36.58 18.24 16.52 15.85 12.55 35.20 12.94 18.82 17.65 13.83 37.70 18.26 13.92 Belgium 12.08 35.67 17.90 17.22 16.40 11.66 34.60 12.83 19.72 17.90 12.51 36.79 18.20 14.61 Bulgaria 13.63 35.47 20.03 17.18 12.94 12.90 34.15 14.48 19.53 14.50 14.40 36.87 19.53 14.69 Czech Republic 13.28 36.90 20.91 14.12 14.04 12.66 35.40 15.10 16.81 15.58 13.93 38.48 20.72 11.30 Denmark 11.10 35.24 19.81 15.09 18.11 10.76 34.48 13.52 17.06 19.43 11.44 36.01 20.04 13.07 Germany 11.74 36.58 18.44 18.94 13.63 11.27 35.08 12.22 21.85 14.99 12.24 38.16 18.72 15.90 Ireland 15.35 37.51 15.42 11.13 20.00 15.09 37.19 11.09 12.43 21.18 15.60 37.83 15.56 9.82 Greece 12.19 37.54 17.58 18.31 13.82 11.56 36.58 12.65 20.14 14.93 12.82 38.53 17.27 16.45 Spain 12.07 40.20 16.49 16.75 13.88 11.59 38.88 11.64 19.05 15.13 12.56 41.56 16.37 14.38 France 13.00 34.46 17.69 16.22 17.69 12.46 33.77 13.11 18.59 19.62 13.57 35.19 17.89 13.72 Italy 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Hungary 13.01 35.87 19.88 15.70 14.41 12.14 34.06 14.38 18.97 16.77 13.98 37.88 19.29 12.09 Netherlands 11.96 36.66 18.86 14.15 17.74 11.64 35.95 13.49 16.16 18.99 12.29 37.39 19.23 12.10 Austria 12.34 37.73 17.70 16.23 15.16 11.79 36.44 11.84 19.00 16.88 12.91 39.10 17.81 13.30 Poland 16.34 36.06 17.92 13.22 15.55 15.51 34.72 14.12 15.93 17.44 17.22 37.48 17.52 10.34 Portugal 12.42 37.28 17.63 17.07 14.73 11.81 36.32 12.49 19.24 16.54 13.07 38.31 17.33 14.75 Romania 15.39 36.95 17.22 14.73 14.93 14.69 35.73 12.89 16.94 16.52 16.12 38.23 16.73 12.40 Slovenia 13.24 38.00 19.03 15.48 13.56 12.64 36.39 13.36 18.79 14.96 13.87 39.68 19.47 12.03 Slovakia 16.01 37.91 17.57 11.68 15.95 15.22 36.55 13.30 14.22 17.76 16.83 39.36 17.06 8.99 Finland 12.45 33.37 20.88 15.94 16.64 11.92 32.11 15.12 18.75 18.11 13.01 34.69 21.19 13.00 Sweden 12.31 33.36 19.64 17.27 16.82 11.91 32.48 13.28 19.44 18.02 12.72 34.26 19.94 15.07 United Kingdom 13.14 35.17 17.74 16.00 17.13 12.60 34.71 12.46 17.90 18.79 13.71 35.65 17.83 14.03 Source: Eurostat
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Table 5: Activity rates by gender, age group and nationality (%), 2006 Total Men Women 15-64 15-24 25-54 55-64 15-64 15-24 25-54 55-64 15-64 15-24 25-54 55-64 Croatia 63.5 38.0 83.7* 48.5** 68.9 41.1 87.2* 58.2** 58.2 34.5 80.2* 39.9** EU 27 70.2 44.0 84.1 46.3 77.5 47.4 91.9 56.1 62.9 40.5 76.4 37.1 Belgium 66.5 34.7 84.5 33.6 73.4 37.4 91.9 42.7 59.5 31.9 77.0 24.6 Bulgaria 64.5 28.9 82.3 43.0 68.8 31.3 85.1 53.6 60.2 26.4 79.4 33.9 Czech Republic 70.3 33.5 88.2 47.7 78.3 37.7 94.8 62.7 62.3 29.2 81.3 34.0 Denmark 80.6 69.9 88.9 63.2 84.1 70.5 92.3 69.6 77.0 69.3 85.4 56.7 Germany (including ex-GDR from 1991) 75.3 50.3 87.6 55.2 81.3 52.9 93.8 64.0 69.2 47.6 81.4 46.6 Ireland 71.8 54.7 81.5 54.4 81.5 59.0 92.1 68.7 61.9 50.2 70.7 40.0 Greece 67.0 32.4 82.0 43.9 79.1 36.1 94.7 61.0 55.0 28.7 69.1 28.0 Spain 70.8 48.2 82.0 46.8 81.3 52.2 92.5 63.5 60.2 43.9 71.2 31.0 France 69.4 37.9 87.0 39.9 74.8 42.2 93.5 42.7 64.1 33.4 80.7 37.3 Italy 62.7 32.5 77.8 33.4 74.6 37.8 91.3 45.0 50.8 26.9 64.3 22.5 Hungary 62.0 26.8 79.6 34.9 68.7 30.1 86.5 43.1 55.5 23.4 72.9 28.2 Netherlands 77.4 70.8 87.1 49.6 83.9 71.5 94.1 60.4 70.7 70.1 80.1 38.6 Austria 73.7 59.4 87.1 36.8 80.5 63.9 93.2 47.3 67.0 55.1 80.9 26.9 Poland 63.4 34.2 81.7 30.7 70.1 37.5 88.2 42.6 56.8 30.7 75.4 20.3 Portugal 73.9 42.7 87.7 53.5 79.5 46.6 92.9 62.7 68.4 38.7 82.7 45.1 Romania 63.6 30.6 79.9 42.8 70.7 35.1 87.1 52.0 56.6 25.9 72.6 34.8 Slovenia 70.9 40.6 89.0 33.4 74.9 44.4 91.0 45.8 66.7 36.4 87.0 21.4 Slovakia 68.6 35.3 87.6 36.7 76.4 39.7 94.0 55.2 60.9 30.9 81.2 20.9 Finland 75.2 51.8 87.8 58.5 77.1 52.6 90.3 58.9 73.3 51.0 85.3 58.2 Sweden 78.8 51.3 89.4 72.8 81.2 50.8 92.5 76.0 76.3 51.9 86.3 69.6 United Kingdom 75.5 61.9 84.5 59.1 82.1 64.3 91.6 68.4 69.2 59.4 77.6 50.2 *LFS data for Croatia refer to the following age category (25-49) ** LFS data for Croatia refer to the following age category (50-64) Source: Eurostat (for EU countries), LFS 2006/2 (for Croatia)
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Table 6: Employment rates by gender, age group and nationality (%), 2006 Total Men Women 15-64 15-24 25-54 55-64 15-64 15-24 25-54 55-64 15-64 15-24 25-54 55-64 Croatia 56.6 27 76.1* 45.0** 62.3 29.5 80.7* 54.7** 51 24.2 71.6* 36.3** EU 27 64.4 36.6 78.1 43.5 71.6 39.3 85.9 52.6 57.2 33.3 70.2 34.8 Belgium 61 27.6 78.4 32 67.9 30.4 85.9 40.9 54 24.7 70.7 23.2 Bulgaria 58.6 23.2 75.7 39.6 62.8 25.4 78.6 49.5 54.6 21 72.8 31.1 Czech Republic 65.3 27.7 82.5 45.2 73.7 31.5 90.4 59.5 56.8 23.7 74.5 32.1 Denmark 77.4 64.6 86.1 60.7 81.2 65 90.1 67.1 73.4 64.1 82 54.3 Germany (including ex-GDR from 1991) 67.5 43.4 79.3 48.4 72.8 45.1 84.9 56.4 62.2 41.6 73.7 40.6 Ireland 68.6 50 78.4 53.1 77.7 53.6 88.4 67 59.3 46.2 68.3 39.1 Greece 61 24.2 75.3 42.3 74.6 29.7 90 59.2 47.4 18.7 60.5 26.6 Spain 64.8 39.5 75.8 44.1 76.1 44.4 87.6 60.4 53.2 34.4 63.7 28.7 France 63 29.3 80.2 37.6 68.5 33.3 87 40.1 57.7 25.2 73.6 35.2 Italy 58.4 25.5 73.3 32.5 70.5 30.6 87.2 43.7 46.3 20.1 59.3 21.9 Hungary 57.3 21.7 74.2 33.6 63.8 24.5 81 41.1 51.5 18.8 67.6 27.1 Netherlands 74.3 66.2 84.2 47.7 80.9 67.2 91.4 58 67.7 65.1 77 37.2 Austria 70.2 54 83.5 35.5 76.9 58.2 89.9 45.3 63.5 49.9 77 26.3 Poland 54.5 24 71.8 28.1 60.9 26.9 78.3 38.4 48.2 21 65.3 19 Portugal 67.9 35.8 81.3 50.1 73.9 39.8 87.4 58.2 62 31.6 75.3 42.8 Romania 58.8 24 74.7 41.7 64.6 27.3 80.8 50 53 20.6 68.6 34.5 Slovenia 66.6 35 84.2 32.6 71.1 39.2 87.1 44.5 61.8 30.3 81.2 21 Slovakia 59.4 25.9 77.2 33.1 67 29.2 84.1 49.8 51.9 22.5 70.2 18.9 Finland 69.3 42.1 82.4 54.5 71.4 42.6 85.2 54.8 67.3 41.6 79.6 54.3 Sweden 73.1 40.3 84.7 69.6 75.5 40.2 87.8 72.3 70.7 40.4 81.5 66.9 United Kingdom 71.5 53.2 81.1 57.4 77.3 54.1 87.9 66 65.8 52.2 74.6 49.1 *LFS data for Croatia refer to the following age category (25-49) ** LFS data for Croatia refer to the following age category (50-64) Source: Eurostat (for EU countries), LFS 2006/2 (for Croatia)
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Table 7: Employment by gender and economic activity in 2006 (%) (according to NACE classification*) 15 years and over a, b c-f Industry g-k Services l Public m to q Other Agriculture, (excluding public administration and services hunting, administration) defence, forestry and compulsory social fishing security Croatia 13.80 28.50 35.00 6.30 16.40 EU-27 5.89 27.64 36.91 7.12 22.45 Belgium 1.95 24.70 37.05 9.90 26.39 Bulgaria 8.11 34.47 33.98 7.22 16.22 Czech Republic 3.76 39.97 32.63 6.75 16.89 Denmark 3.09 23.33 37.06 5.95 30.58 Germany (including ex-GDR from 1991) 2.26 29.59 37.02 7.70 23.44 Ireland 5.74 27.47 39.18 5.14 22.48 Greece 11.98 22.09 39.82 8.55 17.57 Spain 4.78 29.55 39.87 6.19 19.61 France 3.95 24.22 36.59 9.37 25.86 Italy 4.27 30.13 39.02 6.28 20.30 Hungary 4.77 32.36 35.92 7.27 19.67 Netherlands 3.28 20.19 41.89 7.14 27.50 Austria 5.52 28.16 40.20 6.44 19.68 Poland 15.79 29.98 30.42 6.29 17.52 Portugal 11.70 30.57 32.09 6.87 18.78 Romania 30.60 30.71 22.15 5.23 11.32 Slovenia 9.58 35.49 31.13 5.96 17.84 Slovakia 4.39 38.82 31.82 7.04 17.93 Finland 4.67 25.69 36.81 4.70 28.13 Sweden 2.23 21.91 37.52 5.71 32.63 United Kingdom 1.35 21.98 41.70 7.09 27.88 Source: Eurostat (for EU countries), LFS 2006/2 (for Croatia) * NACE classification: A-B agriculture, hunting, forestry, fishing A agriculture, hunting and forestry B fishing C-F industry (mining and quarrying, manufacturing, electricity, gas and water supplies, construction) C mining and quarrying D manufacturing E electricity, gas and water supplies F construction G-K services (excluding public administration) G wholesale and retail trade, repair of motorcycles and personal and household goods H hotels and restaurants I transport, storage, communication J financial intermediation K real estate, renting and business activities L public administration and defence, compulsory social security
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M-Q other services M education N health and social work O other community, social, personal service activities P activities of households Q extra-territorial organization and bodies
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Table 8a: Share of part-time employment in total employment, Table 8b: Share of temporary workers among employees, 2006 15-64, 2006 Total Males Females Total Men Women Croatia 10.1 6.8 13.4 Croatia 12.5 : : EU - 27 18.1 7.7 31.2 EU-27 14.3 13.8 14.9 Belgium 22.2 7.4 41.1 Belgium 8.7 6.9 10.8 Bulgaria 2 1.5 2.5 Bulgaria 6.1 6.2 6.1 Czech Republic 5 2.2 8.7 Czech Republic 8 6.8 9.4 Denmark 23.6 13.3 35.4 Denmark 8.9 7.9 9.9 Germany (including ex-GDR from 1991) 25.8 9.3 45.6 Germany (including ex-GDR from 1991) 14.5 14.8 14.2 Ireland : : : Ireland 3.3 2.9 3.8 Greece 5.7 2.9 10.2 Greece 10.7 9.1 13 Spain 12 4.3 23.2 Spain 34.1 32.1 36.8 France 17.2 5.7 30.6 France 13.5 13 14 Italy 13.3 4.7 26.5 Italy 13.1 11.2 15.8 Hungary 4 2.6 5.6 Hungary 6.7 7.3 6 Netherlands 46.2 23 74.7 Netherlands 16.4 15.2 17.9 Austria 21.8 6.5 40.2 Austria 9 9.1 8.9 Poland 9.8 7.1 13 Poland 27.3 28.4 25.9 Portugal 11.3 7.4 15.8 Portugal 20.6 19.5 21.8 Romania 9.7 9.5 9.8 Romania 1.8 2 1.6 Slovenia 9.2 7.2 11.6 Slovenia 17.1 15.2 19.1 Slovakia 2.8 1.3 4.7 Slovakia 5 4.9 5 Finland 14 9.3 19.2 Finland 16.3 12.6 20 Sweden 25.1 11.8 40.2 Sweden 17 15 18.9 United Kingdom 25.5 10.6 42.6 United Kingdom 5.6 5 6.3 Source: Eurostat, Labour Force Survey 2006/1.
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Table 9a: Unemployment rates by gender, age groups and nationality (%), 2006
Total unemployment Men Women 15-24 25-49 50-64 15-24 25-49 50-64 15-24 25-49 50-64 Croatia 29 9 7,328.2 7.5 6.1 30 10.7 8.9 EU - 27 17.4 7.4 6.3 17.1 6.6 6.1 17.8 8.3 6.6 Belgium 20.5 7.4 5.6 18.8 6.7 4.9 22.6 8.2 6.7 Bulgaria 19.5 8 8.1 18.9 7.6 7.9 20.3 8.3 8.3 Czech Republic 17.5 6.3 6 16.6 4.6 5.2 18.7 8.4 6.9 Denmark 7.7 3.2 3.5 7.9 2.4 3.2 7.5 4.1 4 Germany (including ex-GDR from 1991) 13.7 9.3 11.4 14.8 9.4 11.2 12.5 9.2 11.7 Ireland 8.6 3.9 2.8 9.1 4.1 3 8 3.5 2.4 Greece 25.2 8.6 4.1 17.7 5.3 3.2 34.7 13.2 5.9 Spain 17.9 7.7 5.9 15 5.5 4.4 21.6 10.6 8.5 France 22.6 8.1 6 21.2 7.2 5.8 24.5 9.1 6.3 Italy 21.6 6.3 3 19.1 4.8 2.7 25.3 8.4 3.5 Hungary 19.1 7.1 4.8 18.6 6.6 4.8 19.8 7.7 4.8 Netherlands 6.6 3.3 3.7 6.1 2.9 3.6 7.1 3.8 3.8 Austria 9.1 4.2 3.5 8.9 3.6 3.8 9.3 5 3.2 Poland 29.8 12.4 10.2 28.3 11.2 10.7 31.6 13.8 9.7 Portugal 16.3 7.4 6.5 14.5 5.8 6.7 18.4 9.2 6.2 Romania 21.4 6.7 3.9 22.3 7.6 4.5 20.2 5.6 3 Slovenia 13.9 5.5 3.9 11.6 4.4 3.5 16.8 6.8 4.3 Slovakia 26.6 11.9 11.2 26.4 10.5 10.3 27 13.5 12.4 Finland 18.7 6.1 6.5 19 5.5 6.6 18.4 6.8 6.4 Sweden 21.5 5.5 4.3 21 5.3 4.7 22 5.8 3.8 United Kingdom 14.1 4.1 3.1 15.9 4.2 3.5 12.1 4 2.6 Source: Eurostat (for EU-27), Labour Force Survey 2006/2 (for Croatia)
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Table 9b: Unemployment data of special groups, 2006
Unemployment Long-term Share of the long-term The unemployed rate (%) unemployment rate (%) unemployed (%) among youth (%) Total Men Women Total Men Women Total Men Women Total Croatia 10.9 9.6 12.4 6.7 5.8 7.7 58.9 55.7 62.2 12.3 EU-27 7.9 7.1 8.8 3.6 3.3 4.0 45.3 44.8 45.8 8.4 Source: Eurostat, CBS
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Table 10: Employed, unemployed and inactive population by level of educational attainment, 2006 Employment Unemployed Inactive isced0_2 isced3_4 isced5_6 isced0_2 isced3_4 isced5_6 isced0_2 isced3_4 isced5_6 Croatia 18.2 61.5 19.7 20.6 68.2 11.2 55.5 37.4 7.1 EU-27 24.8 49.5 25.5 11.8 8.3 4.6 51.0 37.7 8.5 Belgium 23.5 38.9 37.6 14 8.2 4.5 56.9 31.7 11.4 Bulgaria 15.1 59.5 25.4 20.5 7.7 4 54.8 37.8 7.4 Czech Republic 5.8 79.5 14.7 24.8 6.4 2.5 38.3 56.3 5.4 Denmark 20.0 46.9 32.9 6.7 3.2 3.3 45.0 39.9 14.9 Germany 16.1 58.7 25.2 18.7 9.9 4.8 45.2 45.6 8.9 Ireland 25.1 38.9 33.0 7.1 4.1 2.5 57.4 29.1 11.4 Greece 35.5 39.3 25.2 8.3 10.7 7.3 54.9 38.6 6.5 Spain 44.2 23.5 32.3 10.5 8.1 6.1 62.9 20.3 11.8 France 26.5 44.7 28.8 13.6 8.2 6 52.6 34.2 13.3 Italy 39.3 45.4 15.2 8.2 6.2 5.3 65.7 28.9 5.3 Hungary 13.1 65.6 21.3 16.7 6.9 2.8 47.8 45.7 6.5 Netherlands 25.5 43.5 30.0 6.1 3.6 2.3 51.9 33.5 13.5 Austria 17.5 64.4 18.1 9.4 4.1 2.6 42.7 50.5 6.9 Poland 9.0 68.7 22.3 23.7 15 6 39.7 55.0 5.3 Romania 21.6 64.4 14.0 9 7.9 3.8 49.8 47.4 2.8 Slovenia 14.4 62.2 23.4 8.4 6.6 3.3 42.6 51.8 5.6 Slovakia 4.6 78.6 16.8 48.6 11.8 3.3 43.1 51.9 5.0 Finland 17.4 47.0 35.5 14.2 8.2 3.7 49.0 37.2 13.8 Sweden 14.7 54.6 30.0 13.9 6.3 4.4 36.2 36.7 11.8 United Kingdom 22.1 45.5 31.7 9.1 5.3 2.8 35.8 32.8 10.9 Source: Eurostat, Labour Force Survey, CBS
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Table 11: Activity, employment and unemployment rates by educational attainment, 2006 Activity rate Employment rate Unemployment rate isced 0-2 isced 3-4 isced 5-6 isced 0-2 isced 3-4 isced 5-6 isced 0-2 isced 3-4 isced 5-6 EU - 27 75.3 86.7 92.3 66.8 80.4 88.3 11.3 7.4 4.3 Men 88.8 93.2 96.1 80.2 87.1 92.5 9.6 6.5 3.7 Women 61.6 79.8 88.9 53.2 73.2 84.6 13.7 8.3 4.8 Source: Eurostat
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Table 12: Economic indicators on the county level
Population GDP per capita in Administrative Persons in Average number of County density per km2, current prices, 2004 unemployment rate (%), employment (end unemployed 2006 (RoC=100) (end March 2006) March 2006) persons, 2006
County of Zagreb 101.2 74.8 14.2 81,517 13,045 County of Krapina-Zagorje 115.9 68.5 14 37,456 5,692 County of Sisak-Moslavina 41.5 74.5 28.9 45,991 17,718 County of Karlovac 39.1 73.9 26.1 38,749 12,968 County of Varaždin 146.4 85.7 13.6 62,598 9,218 County of Koprivnica-Križevci 71.2 90.6 17 38,426 7,534 County of Bjelovar-Bilogora 50.4 74 25.9 35,396 11,834 County of Primorje-Gorski Kotar 85.1 113.7 13.4 113,908 16,220 County of Lika-Senj 10 126.9 22.1 13,515 3,637 County of Virovitica-Podravina 46.1 72.8 30.3 23,361 9,484 County of Požega-Slavonia 47.1 71.1 21.7 20,829 5,332 County of Brod-Posavina 87.1 58.2 29.6 38,486 15,339 County of Zadar 44.4 78.7 20.9 44,312 10,716 County of Osijek-Baranja 79.5 76.9 26.1 91,738 30,176 County of Šibenik-Knin 37.8 71.8 25 29,717 8,806 County of Vukovar-Srijem 83.4 56.8 31.3 43,358 18,477 County of Split-Dalmatia 102.1 79.3 22.2 138,692 37,475 County of Istria 73.4 136.9 8.4 83,867 6,317 County of Dubrovnik-Neretva 69 94.5 18.3 38,366 7,473 County of Međimurje 162.4 77.7 15.8 37,540 6,786 City of Zagreb 1,215.5 180.5 9.2 388,581 37,369 TOTAL 78.4 100 17.7 1,446,403 291,616 Source: Central Bureau of Statistics, Croatian Employment Service
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Annex 4: Detailed Summary Table for the Operational Programme [See also section 3.2 (Indicators) and section 5.2.6 (Evaluation activities and timing) of the OP]
Priority Axis 1 - Enhancing access to employment and sustainable inclusion in the labour market
Measure 1.1 - Supporting the design and implementation of active and preventative labour market policy
Specific objective 1 Result indicators Main types of operations Output indicators Undertake local employment Number of employment partnerships initiatives established Carry out labour market surveys Number of HRD strategies developed Number of Human resources Elaborate local HRD strategies To develop regional participatory development plans (prepared by Local Develop project generation and Number of project portfolios developed institutional framework for promotion Employment Partnerships) accepted articulation facilities in CES at the of employment by the county assemblies regional level
Implement grant schemes in line Number of persons who received with the objectives of the HRD support through the grant schemes strategies
Measure 1.2 - Supporting the effectiveness and quality of Croatia's public employment services
Specific objective 1 Result indicators Main types of operations Output indicators Development of the capacity to Number of steps undertaken to the formulate a coherent legislative establishment of the lifelong career Number of CES staff certified for framework for lifelong career guidance centre provision of different types of services guidance provision To improve the quality, effectiveness to clients by type of service as a result and efficiency of Croatian Establishment of a National Forum of capacity building operations and employment service for lifelong career guidance improved business processes provided through the measure Establishment of a model for lifelong career guidance centre and its pilot- testing
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Strengthen the analytical capacity of Number of CES and MELE staff trained CES and MELE through training in analytical work Establish a training facility within Number of trainers for key business CES for key skills for counsellors processes in CES (focusing on the unemployed),
advisors (focusing on the employers), lifelong career guidance counsellors, specialized counsellors for disadvantaged groups and skills for other CES processes Support design and implementation Number of key business processes of improved business processes supported with ICT solutions with the CES’s IT system and user- friendly IT solutions, including upgrading of the IT equipment & software Create a system of quality Number of key business processes assurance, monitoring, evaluation equipped with quality assurance and training-needs assessment for indicators CES business processes
Priority Axis 2 - Reinforcing social inclusion of people at a disadvantage
Measure 2.1 - Supporting access to employment by disadvantaged groups
Specific objective 1 Result indicators Main types of operations Output indicators Share of disadvantaged groups who Development of new inter- Number of new business processes To promote social inclusion of the were beneficiaries of the measure and institutional and inter-sectoral targeted at the social inclusion of the disadvantaged groups through their who remain in employment one year business processes for the work disadvantaged integration to the labour market after placement with disadvantaged groups
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Training of staff (basic and Number of staff trained for the work Number of disadvantaged unemployed advanced) in the employment and with disadvantaged groups persons included in the new inter- social welfare services
institutional business processes that (governmental, self-governmental, promote social inclusion into the public, non-governmental) for work labour market with disadvantaged groups Training and retraining of Number of unemployed disadvantaged disadvantaged groups persons benefiting from grant schemes (broken down in specific target groups)
Measure 2.2 - Supporting access to education by disadvantaged groups
Specific objective 1 Result indicators Main types of operations Output indicators Supporting the design and Number of educational establishments implementation of educational at the local/regional level involved in the To support access to education for Proportion (%) of disadvantaged programmes specifically targeted on development of educational employment by disadvantaged persons (broken down by common disadvantaged groups (including programmes groups through, inter alia, promoting aggregate groups) having a new/ upgrading facilities and equipment a more flexible policy framework and Number of pilot-testings of educational second access to targeted educational where appropriate). innovative provision of relevant programmes specifically targeted on services and/or modernised facilities. services. disadvantaged groups. Number of persons assisted through the grant scheme Building the capacity of education Number of educational professionals professionals in new services for the who were beneficiaries of training or disadvantaged, primarily in the VET technical assistance measure sector
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Priority Axis 3 - Enhancing human capital and employability
Measure 3.1 – Further development of a National Qualifications Framework
Specific objective 1 Result indicators Main types of operations Output indicators Establishment of a designated Number of steps undertaken to ensure national EQF centre the CROQF implementation Support to the introduction of a systematic CROQF peer-review To strengthen investment in human process capital in Croatia and promote Share (%) of VET / higher education Implementation of the pilot-testing of greater employability by helping students (by common levels of EQF) specific CROQF elements Croatia develop and implement a in pilot-institutions having followed any coherent HRD policy and national Further improvements of the type of education / training based on qualifications framework, and to CROQF consultation and the reviewed CROQF, modernised increase the overall labour market mainstreaming process and related curricula and quality assurance relevance, efficiency and quality of awareness-raising/capacity building mechanisms. the education and training systems campaigns Targeted support to continuous Number of occupational standards and development of the VET Sectoral qualifications/framework curricula Councils, the methodology for developed to a specified standard qualification & framework curricula development
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Support for the design and Number of VET schools receiving grant implementation of a 'VET support under the Pilot-VET Innovation Innovation Fund' Fund established on the basis of the
VET Innovation Strategy Pilot-testing of the VET Innovation fund Support to institutional and policy Number of VET schools carrying out development in the field of VET the pilot testing of the self-evaluation at quality assurance. the micro level Further capacity building of relevant Percentage of staff and practitioners VET secondary school staff and included in capacity building activities other key practitioners in the field of out of the total number of staff QA Further improvements of the Number of new modules within VETIS Vocational Education and Training developed Information System (VETIS) and systematic exchange of experience and information on the VET QA
Priority Axis 3 - Enhancing human capital and employability
Measure 3.2 - Strengthening the provision of Adult Learning
Specific objective 1 Result indicators Main types of operations Output indicators Development of an institutional Set of criteria for the selection of Number of unemployed adult persons framework for institutions at the local institutions at the local level identified To improve skills and competences of and other target groups of adult level, for entrepreneurial and other adults and so enable them to population at the local level enrolled in basic skills participate more actively in the labour new / modernised adult learning market. Basic capacity building of selected Number of train-the-trainers (ToT) programmes. local institutions. modules designed and delivered.
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Procurement of equipment for Training equipment sets procured and selected local institutions. installed. Comprehensive development of the Number of new / modernised basic basic competences programmes in skills training programmes developed. line with the EU Reference Framework for Key Competences.
Measure 3.3 - Supporting the development of institutions and their partners responsible for the provision of vocational education and training, and adult education
Specific objective 1 Result indicators Main types of operations Output indicators Share (%) of the employees and A review of current responsibilities of Number of steps undertaken to ensure external expert/ associates of the the AVET/AAE and specific that administrative capacity is further Croatian public institution and other recommendations, reflecting the built in the relevant institutions To support the development of the institutions who successfully evolving requirements of the capacity of Croatia’s public completed specialist capacity building Croatian VET system institutions and relevant non- activities and are certified to provide Support to AVET and AAE in governmental partners in the adequate support to ongoing VET / organisational and management vocational education and training field adult learning reform. activities and in the design and and in the field of adult education. preparation of manuals, operational procedures, guidelines, checklists Number of specific cohorts (with at and templates least 10 staff members of the AVET/other key institutions per each Elaboration of a mid-term plan for Mid-term plan for AVET research and activity) involved in tailor-made the AVET’s research and analysis analysis function prepared. training & other TA support in specific function VET / AL areas and overall AVET’s Elaboration of an international International partnership programme development partnership programme and Action and Action Plan prepared. Plan for: internal development planning, decision-making, overall VET management, project preparation and co-financing, etc
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Establishment of a training system Training plan prepared for AVET/AAE staff and relevant Number of persons trained staff members of other key
institutions
Priority Axis 4 - Technical assistance
Measure 4.1 - Project preparation
Specific objective 1 Result indicators Main types of operations Output indicators Support to final beneficiaries in the Number of tender document sets preparation of tender documentation prepared for service and supply contracts Number of guidelines prepared To prepare a project pipeline for all Support to implementing bodies in operations and measures and ensure the preparation of guidelines for sufficient projects are fully mature Number of mature projects ready for potential applicants and ready for submission to the contracting Support to potential grant applicants Number of potential applicants Project Selection Committee in the preparation of their receiving support through TA throughout the programme duration. applications
Support to final beneficiaries in the Number of tender document sets preparation of tender documentation prepared for service and supply contracts
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Measure 4.2 - Programme management and capacity building
Specific objective 1 Result indicators Main types of operations Output indicators Support to the Croatian OP Number of staff from OP administration administration, regarding any aspect bodies involved in the capacity building of management, monitoring, operations evaluation and control, including grant scheme management and procurement.
To ensure efficient and effective OP Quality of OP management (of Support to the Croatian OP management, and develop the monitoring system, financial control administration in elaboration of institutional capacity for managing system, project selection system and sector studies and master plans and absorbing IPA component IV evaluation system) assistance The preparation and implementation Number of information events of information and publicity activities organised Support (including advice and Number of persons involved in training training) to socio-economic partners, or technical assistance operations beneficiaries and civil society, to support the implementation of measures (including grant schemes) in specific sectors
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Annex 5: Human Resources Development Operational Programme - Organigram
European Commission Competenet Programming Accrediting Officer OP & IPA implementation Transfer Request Financial (C AO ) OP adjustments reports (and to NAO) Reports on of funds of funds reports Accrediting N A O & N F. SCF Coordination management & Group Monitoring NAO, NF and control system management & control system O P Inter-M inisterial CODEF Ministry of Finance Working Groups Coordinating Coordination, Programming C ertification , A ccreditation and and Monitoring Financial Management National IPA Coordinator OP Monitoring National Authorising Officer Audit Authority IPA Monitoring (NIPAC) implementation IPA m onitoring data (N A O ) Committee reports (Separate agency reporting to Chaired by: IPA implementation reports CAO, NAO & EC) Strategic Coordinator Financial NIPAC & EC (joint) National Fund (NF) Division Proposals reporting (& to NAO ) Irregularity reporting Proposals Reporting OP implementation Monitoring Proposed OP monitoring reports data OP adjustments O perating S tructure data
Sectoral S election criteria Monitoring Body responsible for OP Committee OP monitoring data Ministry of Economy, Labour and Entrepreneurship (MELE) Payment request Checks IPA implementation reports Directorate for Labour and Labour Market Transfer & Recoveries Chaired by: of funds Head of Operating Proposals controls Structure Recommendations
Checks Checks & Recommendations Reporting & Instructions Monitoring Irregularity controls controls Monitoring data data
Implementing Bodies Project Selection Body responsible for Priority/Measure Payment request Croatian Employment Service: PA1 (M1.1 and 1.2), PA2 (M2.1.), PA4 Committees Ministry of Economy, Labour and Entrepreneurship: Irregularity PA 1 (M1.1 and M1.2.) & PA 4 (M 4.1 and 4.2) (M4.1 and 4.2) Reporting Chaired by: Ministry of Health and Social Welfare: PA2 (M2.1) Agency for Vocational Education & Training: PA2 (M2.2) & M3 (3.1, Implementing Body Ministry of Science, Education & Sports: Instructions 3.2 and 3.3) Tendering*** PA 2 (M2.2) & PA 3 (MA 3.1, 3.2 and 3.3) Checks (Contracting Authority) Preparing contract*** & controls Payments Verifications Project (On-the-spot checks) Signing Invoices/ A pplication monitoring Recoveries Contract addenda*** contract payment claims Tender appraisal data C ontract term ination*** Tender S election Committees Legend Pre-contracting & contracting Chaired by: PA: Priority Axis Funding flows & controls Final Beneficiaries Implementing Body *** Ex-ante control M : Measure Monitoring (and their Contractors) by EC Delegation Reporting Others
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Annex 6: Ex-ante Evaluation Report
THE EX ANTE EVALUATION OF IPA OPERATIONAL PROGRAMMES FOR CROATIA Human Resource Development Operational Programme
Martin Ferry, Irene McMaster, Keith Clement, John Bachtler, Sara Davies, Laura Polverari and Douglas Yuill
European Policies Research Centre University of Strathclyde 40 George Street Glasgow G1 1QE United Kingdom
Tel: +44-141-548-3061 Fax: +44-141-548-4905 e-mail: [email protected] April 2007
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Executive Summary
This report comprises the findings of the ex ante evaluation of the IPA Operational Programme (OP) for Human Resource Development for Croatia (2007-09) undertaken by the European Policies Research Centre (EPRC).
The OP provides coherent and accessible coverage of the key issues under Human Resource Development, according to the Commission template for IPA OPs. The OP broadly integrates EU and Croatian priorities in the field. Although there are some gaps in the analysis, it provides a sound basis for the strategic approach taken by the programme. The structure of objectives and priorities flows logically from the analysis, though there could be room for further consideration of the structure of some priorities and measures. Systems for monitoring and evaluation and management and implementation have evolved between OP drafts but some further detail and clarification is required in certain areas.
Taking each of the three main policy headings in turn (employment, education and training and social inclusion), there are some areas where additional information could be added to the analysis, or the text restructured, to strengthen the justification for strategic objectives. Closer attention could be paid to the link between the SWOT and the analysis as there are some gaps and inconsistencies where specific aspects of the SWOT do not relate clearly to issues in the background analysis. There is a need for some further consideration of the structure of the priorities and measures. For instance, a general concern is that there is quite a large variety of activity streams included under some priorities and that these activities vary considerably in their nature and scope. More detail on how decisions on the allocation of resources and the sequencing of financial flows to different measures over the first three years would be valuable. It would be helpful to provide more detail on the Programme’s coherence with the Lisbon strategy and other IPA OPs. Work on indicators is still in progress and there are still significant gaps. Similarly, the consultation process was still in progress during the ex ante evaluation. Currently, the description of the consultation arrangements provides only a broad outline and more detail of the process and its outcome will be added in the next draft. Additionally, on the issues of programme management and implementation, some clarification concerning the identity, functions and timetable for the introduction of Implementing Bodies, and their relationship to other management bodies is required. Within the OP, environment is not well integrated. To address this issue, a broader interpretation of environment could be adopted.
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Preface
The aim of the ex ante evaluation of the IPA Operational Programmes for Croatia is to provide an external perspective on the preparation of the new Programmes with a view to improving and strengthening the final quality of the Programmes and optimising the allocation of resources.
The evaluation was undertaken by a research team from the European Policies Research Centre (EPRC) at the University of Strathclyde in Glasgow. Within EPRC, the ex ante evaluation of the evaluation was managed and undertaken by the following team:
1 Dr Irene McMaster (Research Fellow) - Programme overview 2 Professor John Bachtler (Director) - Environment OP 3 Professor Douglas Yuill (Director) - Environment OP 4 Dr Sara Davis (Senior Research Fellow) - Transport OP 5 Laura Polverari (Senior Research Fellow) - Regional Competitiveness OP 6 Dr Martin Ferry (Research Fellow) - Human Resources OP 7 Dr Keith Clement (Senior Research Associate), responsible for Environmental Assessment
The EPRC team would also like to thank the following local experts for their valuable insights: Sanja Crnković-Pozaić, Maja Vehovec, Dubravka Jurlina Alibegovic and Mak Kisevic.
European Policies Research Centre Glasgow April 2007
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THE EX ANTE EVALUATION OF IPA OPERATIONAL PROGRAMMES FOR CROATIA
1. INTRODUCTION
This report comprises the findings of the ex ante evaluation of the IPA Operational Programmes (OP) for Human Resource Development for Croatia (2007-09) undertaken by the European Policies Research Centre (EPRC). The report is part of a wider set of IPA ex ante evaluations. The context for the evaluation and a detailed explanation of the methodology is contained in the accompanying ‘Overview Report’. The structure of this report is as follows:
• general overview of the OP; • appraisal of the socio-economic analysis and the relevance of the programme strategy to the needs identified; • evaluation of the rationale of the strategy and its consistency; • appraisal of the internal and external coherence of the strategy; • an assessment of expected results and impact; • an appraisal of the proposed implementation system; • an appraisal of environmental integration; and • summary conclusions.
2. HUMAN RESOURCE DEVELOPMENT OPERATIONAL PROGRAMME: CONTEXT
2.1 IPA support for human resource development measures
The HRD element of the IPA will contribute to strengthening economic and social cohesion as well as contribute to the priorities of the European Employment Strategy in the field of employment, education and training and social inclusion.24
Employment can be targeted by a wide range of policy interventions, e.g. indirectly through policies aimed at social and economic development and/or directly through specific labour market policies. Active labour market policies, built around the principles of ‘prevention’ and ‘activation’, include job search assistance (public employment services), provision of training (training programmes such as classroom training, on the job training, work experiences), subsidization of job creation in the private sector (such as subsides to employers or financial incentives targeted to the unemployed for business start-ups), and temporary job creation in the public sector.25 Related, the actors and institutions involved in these types of intervention are numerous.
In the European Union, the long-standing aims of combating unemployment and promoting employment have been given operational content through the European Employment Strategy (EES) and Employment Guidelines. Now, the EES has been integrated into the Lisbon Strategy for sustainable economic growth and full employment, resulting in a new structure based around the objectives of full employment, quality at work
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and cohesion and delivered under ten priorities: activation and prevention, job creation and entrepreneurship, adaptability and mobility, human capital and lifelong learning, labour supply and active ageing, gender equality, integration of people at a disadvantage, making work pay, undeclared work, and regional disparities.26
The importance of education and training in producing economic, social and other outcomes means that it is also a key development priority. For many years, the EU has been committed to increasing the proportion of young people leaving education with a qualification, and enhancing work-related training. Current developments are also driven by the requirements of a knowledge-based economy, including a focus on updating skills and promoting new competencies, and, most recently, broadening access to education and training and developing e-learning and ICT skills. Related, education and training covers a wide range of interventions, actors and institutions, and these have become more numerous and more complex in recent years. This reflects important developments in the demand for and supply of education and training, often driven by wider social and economic needs (including technological and lifestyle changes), and a greater customer focus on delivering and funding provision resulting in the need for flexible education and training in terms of curriculum, accreditation and delivery.
Human resource development interventions also take into account issues related to social exclusion. A key challenge for OPs is to foster social inclusion by ensuring a positive and dynamic interaction between economic, employment and social policy.27 This is a particular priority, as investing in people is seen as crucial to not only building social inclusiveness, but it is also essential to improving economic performance. Within the wider context of human resource development, initiatives to promote social inclusion could have a range target groups (e.g. unemployed, disabled, specific ethnic groups) and cover a range of policy fields (education, employment health and housing). Policies can either be developed to target these groups or particular efforts are made to ensure that do not disadvantage such groups.
In terms of the delivery of all of these interventions, increasingly, a decentralisation process has been taking place in many European countries. Especially in the field of employment services and training, the local level has been considered the best intervention level, due to its closeness to local labour markets, which may be very different in terms of needs and potentialities. In addition, in most countries, the relevant role of the social partners has been recognized in facilitating and promoting employment policies at the local level. It is also worth noting that the synergies and incentives created by the interaction of different policy interventions and the cumulative impact of policy regimes have a key role to play in meeting programme objectives. Therefore, the wider institutional framework in which these policies operate, consisting of policy regimes, organisational regimes and incentive regimes.
Key evaluation questions relate to:
• the likely use and accessibility of the programme (i.e: What is the likely level of awareness among the eligible and potentially eligible population? How to ensure that those eligible to participate in the programme get involved? Who does and who doesn't? Is the target population poorly defined, or the programme delivery poorly controlled?) • the delivery of the programme (i.e. Is the programme delivery consistent with the aims? Which actors are involved in the programme delivery? What are the times and quality of delivery) • the identification of variations in the programme delivery (Were programme resources and delivery
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consistent across all geographical locations? Is it possible to identify best practices among different delivery locations? Are there targeting mechanisms, i.e. delivery focussed on those groups that are ‘easier’ to help instead of the most challenging groups?) • the organisation of the programme (What are the main models of programme organisation and delivery?, How well do different staff/actors involved in delivery work together?) • the programme resources (Is programme staffing and funding sufficient to ensure appropriate standards? Are programme resources likely to be used efficiently and effectively? Are costs per outcome reasonable and offset by the benefits?) • participant experience of the programme (How were participants going to be involved in the programme? Have partners been involved in the development of the programme?)
2.2. Development of the HRD OP The OP has been prepared by an Inter-Ministerial Working Group (IWG) chaired by the Central Office for Development Strategy and Coordination of EU Funds (CODEF) and including representatives of the Ministry of Economy, Labour and Entrepreneurship (MELE); the Ministry of Science, Education and Sport (MSES); the Ministry of Health and Social Welfare (MHSW); the Croatian Employment Service (CES); the Agency for Vocational Education and Training (AVET); the Agency for Adult Education (AAE); Education and Teacher Training Agency (ETTA); Central Bureau of Statistics (CBS); Ministry of Foreign Affairs and European Integration (MFAEI); and, CARDS 2003.
The first draft of the OP was produced by the IWG in November 2006. This was structured according the Commission template for IPA OPs and provided a comprehensive review of all the main issues required under the template headings, although there was scope for restructuring and supplementing the text, clarifying and strengthening links between the needs analysis and the strategic priorities and addressing some gaps relating to the analysis section, financial tables, monitoring targets and consultation process. Comments on the first draft were received from the European Commission Delegation, DG Employ. The main comments concerned the need to streamline the OP structure, strengthen links towards future ESF activities, provide a clearer picture of the relationship between PHARE and CARDS programmes and the OP and increase the focus on absorption capacity. A second draft of the OP was produced in March 2007, incorporating responses to the specific Commission comments as well as a restructuring of some sections (notably relating to context and complementarities with other EU assistance programmes), additional text and updated data for the socio-economic analysis (including a stronger regional dimension), and further information on the financial tables and monitoring indicators. Commission comments on the second draft focussed on the OP’s coherence with other programmes (notably the draft Joint Assessment of Employment Priorities - JAP) the reorganisation of some measures, the development of more streamlined measure templates and a clearer indication of the balance between the role of central agency activities and small projects in the OP.
2.3 Evaluation of the HRD OP The EPRC evaluation of the HRD OP was initially undertaken on the basis of the first draft, based on the EPRC checklist and summarised in the preliminary assessment sent to CODEF in March 2007.
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During a fieldwork visit to Croatia on 26-29 March 2007, further assessment was undertaken on the basis of the second draft of the OP and meetings were held by EPRC with the following:
• EU Delegation to Croatia • Ministry of Economy, Labour and Entrepreneurship (MELE); • Ministry of Science, Education and Sport (MSES); • Ministry of Health and Social Welfare (MHSW); • Croatian Employment Service (CES); • Agency for Vocational Education and Training (AVET); • Agency for Adult Education (AAE); Subsequent analysis of the OP was undertaken by a local expert28, commissioned by CODEF on the basis of guidance provided by EPRC. The remainder of this report describes the outcome of the above research, structured under the main headings required by the EU regulations and Commission guidance. The local expert also undertook discussions during April 2007 with:
• The Education and Teacher Training Agency; • The University of Zagreb; • The Croatian Employer's Association; and • The Association of Independent Unions.
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3. GENERAL COMMENTS ON THE OP
The OP provides coherent and accessible coverage of the key issues under Human Resource Development, according to the Commission template for IPA OPs (see Box 1 below). The OP broadly integrates EU and Croatian priorities in the field. Although there are some gaps in the analysis, it provides a sound basis for the strategic approach taken by the programme. The structure of objectives and priorities flows logically from the analysis, though there could be room for further consideration of the structure of some priorities and measures. Systems for monitoring and evaluation and management and implementation have evolved between OP drafts but some further detail and clarification is required in certain areas.
Box 1: Structure of the Human Resource Development OP
1. Context, consultation and coordination 1.1.1. The national socio-economic and political context 1.1.2. The EU policy context 1.1.3. The process of elaborating the Operational Programme
2. Assessment of medium term needs, objectives and strategic priorities 2.1.1. Socio-economic analysis 2.1.2. SWOT 2.1.3. Strategic priorities
3. Programme strategy 3.1.1. Concentration of assistance, priority axes and measures 3.1.2. Priority axes 3.1.3. Measures 3.1.4. Horizontal issues 3.1.5. Complementarities with other forms of assistance 3.1.6. Indicative list of major projects
4. Financial tables 4.1.1. Calculation of Community contribution 4.1.2. Financial table
5. Implementation provisions 5.1.1. Management and control 5.1.2. Monitoring and evaluation 5.1.3. Information and publicity
Annexes: I Membership of the Inter-Ministerial Working Group II Outline Communications Strategy for IPA III Analytical tables and figures
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Background analysis is divided between two sections: Section 1.1 outlines Croatia’s macro-level socio- economic and policy context with a particular focus on HRD-related themes and Section 2.1 contains the main socio-economic analysis. The second draft of the OP has restructured the context, assessment of needs and SWOT sections of the OP and this has addressed some problems with duplication in the first draft OP. In establishing the policy context, the OP introduces a useful overview of the main accession documents and Croatian national strategies. Nevertheless, some partial duplication remains (e.g. concerning the description of education provision in Section 1.1.2 (p.6) and again in Section 2.1.3 (p.22)). One recommendation could be to limit Section 1.1 to the policy context where the hierarchy of policies, strategies and interventions at EU and domestic levels is useful. The socio-economic content could be integrated with Section 2.1.
4. APPRAISAL OF THE SOCIO-ECONOMIC ANALYSIS AND THE RELEVANCE OF THE PROGRAMMES’ STRATEGIES TO THE NEEDS IDENTIFIED
4.1 Overview of human resource development issues
Section 1.1 outlines the national socio-economic and policy context, consisting of general macro-economic information and more specific HRD-related data. It also sets out the key domestic policies relating to the three main HRD headings of employment, skills, education and training, and social cohesion and inclusion. The main socio-economic analysis is in Section 2.1. In general, this provides an overview of the relevant issues under five main headings: demography and public health; employment and unemployment (including by sector, and with reference to flexible employment); education, training and skills; social protection, social income and social inclusion; and regional disparities (the last category has been added as a distinct section in the second draft OP).
The use of statistical information to support statements is generally sound, drawing on domestic and Eurostat sources to make some EU comparisons. Under each heading, the most important trends are drawn out, illustrated by statistics drawn from Eurostat and domestic sources and sometimes setting the Croatian experience in comparative context with different Member States and the EU as a whole (tables have been moved to an annex in Draft 2).29 The main Croatian statistical data source for poverty and social exclusion is the Croatian Bureau of Statistics (CBS) which conducts a Household Budget Survey (HBS). Coverage in this is improving and it has been harmonised with Eurostat. There are also Labour Force Surveys.
Section 1.2 outlines the EU policy context. The framework provided by Commission strategies and guidelines informs the analysis and the strategic sections of the HRD OP in quite a prescriptive way. The OP is rooted in the Strategic Coherence Framework (SCF) which sets out how IPA funding is to be used in Croatia and IPA Components III and IV. HRD-related objectives of the SCF have been informed by European Employment Strategy and European Employment Guidelines. Priorities indicated in the OP must also be in line with and result from the Joint Memorandum for Social Inclusion (JIM) and the Joint Assessment of Employment Priorities (JAP), which all accession countries must prepare. Drafting of the OP has taken place in close co- ordination with the elaboration of the JIM and JAP documents. The overall priority is “Creating more and better jobs. More immediately, attracting and retaining more people in employment by increasing human capital investment, reinforcing social inclusion and promoting adaptability of enterprises and workers”. This covers the main strategic headings of Employment, Education and Training, and Social Inclusion. Administrative capacity is treated as a cross-cutting theme under each of these headings.
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The overall conclusion is that, in the relatively short time since the end of the war, and particularly since engaging in the process of accession to the EU, Croatia has made ambitious commitments to modernisation and reform in relation to policies concerning the development of human resources. Given the scale of the commitments, the limits to available resources and the unfamiliar nature of many of the challenges confronted, there is significant pressure on public administration as a consequence. This presents a strong justification for the proposed concentration of assistance delivered through the HRD OP on developing the capacity of the key relevant public institutions at both the national and local levels. Nevertheless, taking each of the three main policy headings in turn, there are some areas where additional information could be added, or the text restructured, to strengthen the justification for strategic objectives.
4.1.1 Employment Under the employment heading, the Croatian labour market is characterised by an ageing labour force, a relatively low employment rate and a relatively high unemployment rate. Both the share of the long-term unemployed, particularly among unemployed women and the rate of unemployment among the youth, are high. There are large differences in relative unemployment among the regions, reflecting different labour demand and insufficient wage flexibility. Croatia is experiencing population ageing and decline. Up until recently, net immigration had offset this but this now this trend is declining. A declining, ageing population has clear implications for work-force size and a significant increase in employment rate is required to contribute to increased spending on health and social assistance. A key policy in this field is the National Action Plan for Employment (NAPE) and its annual Employment Promotion Plans, informed by the European Employment Strategy. These aim to promote employment, social inclusion, Vocational Education and Training (VET), entrepreneurship and improvement of the business environment. The main instruments for active labour market measures are CES employment subsidy programmes for new starts. Subsidies have aimed to target specific groups (youth, elderly, disabled etc). CES also provides low level finance to municipalities’ labour market interventions and some specific measures to national minorities (Roma). However, the programmes have also included general ‘introduction to job’ provisions that apply to everyone and this has limited the impact on these specific target groups. Key challenges identified include: reaching target groups without making conditions too restrictive and thus limiting participation; placing more emphasis on training and upgrading skills; developing provisions for the monitoring and evaluation of the impact of active labour market interventions on target groups. The main focus of OP activities under this heading is to strengthen the capacity of CES and this seems justified, given the challenging agenda. Specific comments under this heading are:
• Some gaps in public sector administrative capacity or institutional constraints are noted as one of the key weaknesses to be addressed in the OP. These gaps are noted in different parts of the analysis (e.g. in terns of efficiency, data-gathering capacity, coordination between central, regional and local structures). However, a more explicit summation in relation to employment services could strengthen the argument for the OP’s focus on capacity-building. • There is very little detail on internal migration processes and labour force mobility, though low regional mobility of the labour force is listed as a strategic weakness. Even if there is limited information on this, some text should be included in the regional disparities section of the socio- economic context (Section 2.1.5). Related, there could also be some discussion of the potential tension between increasing regional labour force mobility as a result of VET and increased employability and the threat of depopulation in some regions, mentioned in the same section. For
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instance, extensive urbanisation and out migration in the past has left some areas with labour shortages and an ageing population. Related, changing age structures and a decreasing working age population is likely to have negative impacts on labour supplies, particularly for key sectors such as, ICT, bio-technology and construction. These challenges could suggest the need for targeted support for these regions, at some point. Is increased labour mobility seen as a potential strength or as a threat in the Croatian context? • Additional points that could be mentioned in the analysis include: o the development of a more sophisticated and inclusive definition of ‘employment’, taking into account flexible working, self-employment, informal employment and other forms of work contract; and
o noting that a considerable proportion of employment in agriculture in Croatia involves the elderly working in subsistence agriculture.
4.1.2 Skills, training and education The Croatian population has relatively high rates of secondary education but low rates of higher education and the workforce has relatively low skill levels. There appears to be a significant mismatch between the contents of education and the requirements of the labour market and there is very low provision of adult education and training. A system of polytechnics at post-secondary level has been introduced but the provision of VET is weak and there are high levels of unemployment for graduates from these. An important policy response is the Education Sector Development Plan 2005-10 which aims to improve the quality of training, support teacher training and encourage more strategic approaches in the field. In addition, new organisations have been established recently, notably: the National Council for Higher Education; the Commission for Adult Education; the Agency for Vocational and Educational Training (AVET) and the Agency for Adult Education (AAE). These are in the process of introducing a range of initiatives, including the development of a National Qualifications Framework, a survey of labour market needs (with the aim of rationalising the VET sector), the development of sectoral councils to match skills to labour market needs, the upgrading of the school curricula and the development of local partnerships for employment with municipalities, local CES and employers. Again, the general capacity-building focus of the OP under this heading seems justified given the agenda of the relevant agencies. Specific comments are as follows:
• The assessment of labour market skills needs and gaps could be improved through the use of employer skills surveys. The ‘mismatch’ between the skills base of the working-age population and the demands of employers is highlighted as a significant strategic challenge but additional information could be added, making clear what the skills needs of employers actually are. Section 2.1.3 notes that no definitive analyses of the responsiveness of the education system to labour market needs has been completed, but a clear commitment to developing mechanisms to collate and maintain information on skills needs would perhaps make sense at this stage. In the mean time, some analysis could be based on the limited data available (for instance from JAP and the Sector Councils). • Given the importance attached to the service sector in the OP and the role of ICT in some of the industries under this heading, more detail could be provided on the characteristics and trends of the development of the Information Society. The identification of the impact of these trends on the qualifications of youth and adults, as well as an indication of the barriers faced by certain social
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groups in access to information technology or potential synergy with activities related to boosting ICT systems would be useful. Synergies between the HRD OP in providing ICT training and the activities of the Regional Competitiveness OP in developing ICT infrastructure could be developed more fully in the text.
4.1.3 Social Inclusion Croatia faces the challenge of modernising its health and social welfare systems and to strengthen social inclusion and cohesion. Besides ethnic minorities, the most visible marginalised group appears to be the disabled. As is the case with education and employment, significant locational variations persist in relation to the provision of social and health services. Social care services have traditionally been heavily centralised in the 1990s with little involvement of private or voluntary sectors. After 2001, some decentralisation of services, particularly for the elderly and infirm, took place and more opportunity was created for private or voluntary participation. There has also been a process of gradual deinstitutionalisation and a growing number of clubs, centres, fostering services etc. Partnership working with social partners has gradually improved (e.g. through the Government Office for NGOs and the National Foundation for Civil Society Development). There is also growing awareness of gender issue (e.g. through the Gender Equality Act 2003, Gender Ombudsman, Promotion of Gender Equality strategy). However, the social service sector is still underdeveloped and there is a need to move from the introduction of legislation and the development of an institutional framework to the implementation of measures and this justifies the OP focus on strengthening the capacity of implementing agencies. Nevertheless, there are some aspects of the analysis that could be improved under this heading:
There could be scope to highlight the fact that some people and groups can be the subject of multiple disadvantages and that this will be taken into account in the OP. This emphasises the need to include flexibility in the OP to allow it to access people across different target groups, sectors and regions. This would also call for more complete, standardised data about social welfare provision to be developed.
Given the importance of the regional dimension (c.f. data in the 2007 World Bank Study ‘Croatia: Living Standards Assessment, Promoting Social Inclusion and Regional Equity’), the new sub-heading on regional disparities is welcome. However, a short summary of regional- specific variations in skills needs (in so far as information is available) could be included. Interventions relating to expanding or improving skills should be responsive to local and regional labour market needs which will require some reference to different regional labour market dynamics. This is particularly the case given the rural/urban divide mentioned in the OP e.g. related to agriculture, heavy industry etc.
There could also be scope to emphasise further the role that the social inclusion heading can have in driving economic development (e.g. by strengthening the case for the role of care and support structures in supporting the labour market and the development of the secondary labour market (social economy) mentioned briefly in Section 2.3.4. This would strengthen the harmonisation of social welfare issues with economic development perspectives in the programme.
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4.2 The SWOT analysis A SWOT analysis is included in Section 2.2. It gives a good general reflection of the main issues highlighted in the baseline assessment which precedes it. It is broken down into three headings that correspond to the main themes covered in the background analysis (Employment, Education and Training, Social Inclusion). However, closer attention could be paid to the link between the SWOT and the background analysis as there are some gaps and inconsistencies where specific aspects of the SWOT do not relate clearly to issues in the background analysis. For example:
• Low regional mobility of the labour force is noted as a weakness in the SWOT but ‘brain drain’ is also mentioned as a threat. As noted above, the OP’s perception of the potential tension between increasing regional labour force mobility as a result of VET and increased employability and the threat of depopulation in some regions should be clarified. • Resistance to reform and unwillingness to change and adopt new practices in education and training is listed as a threat but not dealt with clearly in the context section. • Increasing research programmes and fellowships for young researchers is noted as a strength but there is little detail on this in the analysis. • No mention of regional disparities in education as a weakness, though this is highlighted in the socio-economic analysis (p.26). • It may be worth considering the following issues in the SWOT: rising levels of entrepreneurial activities in the country; the opportunities to encourage activities, e.g. self-employment, which are currently not captured by accounts of economic activity; high wage differentials in the country may help to attract well educated workers into the country; the low priority given to employee training could be a potential threat; the need for educational reforms to take into account labour market needs is another important issue; the particular challenges to social inclusion faced in lagging regions should be recognised; weak cooperation between key institutions and agencies is a problem; and high levels of university drop-outs is a particular challenge.
5. EVALUATION OF THE RATIONALE OF THE STRATEGY AND ITS CONSISTENCY
5.1 Strategy Strategic priorities are outlined in Section 2.3. This section makes clear that the strategy is rooted in the Strategic Coherence Framework (SCF), informed by European Employment Strategy guidelines and EES priorities, which sets out how IPA funding is to be used in Croatia, IPA Components III and IV and the Croatian Strategic Development Framework and the JIM and JAP documents. The SCF states that assistance made available to Croatia under IPA Component IV will concentrate in the first instance on:
• capacity building with the aim of preparing Croatian institutions and beneficiaries for delivery and absorption of support from the European Social Fund on accession, and • the most significant of the areas of concern that are identified by the relevant strategic EU and national documents as being crucial to human resource development.
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This covers the main strategic headings of Employment, Education and Training and Social Inclusion. Administrative capacity is treated as a special focus for IPA Ops, giving four priorities (not including Technical Assistance):
• Attract and retain more people in employment and modernise social protection systems • Improve adaptability of workers and enterprises as well as flexibility of labour markets, and • Increase investment in human capital through better education and skills. • Building administrative capacity. The table below presents the Priority axes and their related measures, indicating in a general way how the relevant EES guidelines are incorporated.
Table 1: OP priorities, measures and EES guidelines
Priority axes Measures EES guidelines
Guideline 17: Implement employment policies aiming at achieving full employment, improving quality and productivity at work, and Measure 1. strengthening social and territorial
Priority axis 1: Supporting the design and implementation of cohesion active and preventative labour market policy. (In Enhancing Access to Employment and particular through the development of Labour Market Re-integration. partnerships between public employment Guideline 18: services, other public bodies, and representatives of business and labour.) Promote a lifecycle approach to Work. Guideline 21: Promote flexibility combined with employment security and reduce labour market segmentation having due regard to the role of the social partners Measure 2a. Supporting access to employment Guideline 19: by disadvantaged groups. Ensure inclusive labour markets, Priority axis 2: enhance work attractiveness, and make work pay for job-seekers Reinforcing Social Inclusion of the including disadvantaged people, Disadvantaged. and the inactive Measure 2b. Supporting access to education by
disadvantaged groups. Measure 3a. Improving the content, and Guideline 20: delivery of vocational education & training for all Priority axis 3: age groups. Improve matching of labour Enhancing Human Capital and market needs Employability. Measure 3b. Developing skills and facilities for Guideline No 23: lifelong learning. Expand and improve investment in
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human capital
Measure 4a. Supporting the improvement of the
effectiveness and quality of Croatia’s public employment services. Priority axis 4: Measure 4b. Supporting the development of Guideline No 24: Strengthening Institutional Efficiency institutions and their partners responsible for the of Public Administration in the provision of vocational education and training, Adapt education and training Employment and Social Field. and adult education, in Croatia. systems in response to new competence requirements.
Measure 5a. – Project preparation. Priority axis 5: Supporting the Development and Measure 5.b – Programme management and Provision of Administrative Capacity Related to the Delivery of this capacity-building Operational Programme.
The OP strategy is clearly rooted in the analysis. In fact, the framework provided by Commission strategies and guidelines (including the SCF, MIPD, European Employment Strategy and the JIM and JAP documents) informs the analysis and the strategic sections of the HRD OP in quite a prescriptive way and this ensures overall consistency. Descriptions of the Priority axis have been expanded between OP drafts. In the second draft OP, each axis has a rationale, specific objective, and description, including relationship with existing, related programmes and strategies. However, there is a need for further consideration of the structure of the Priorities and Measures:
• A general concern is that there is quite a large variety of activity streams included under some Priorities and that these activities vary considerably in their nature and scope. For instance, Priority 1 includes establishing national and regional partnerships for employment, the provision of advice and counselling, employment subsidies, retraining exercises and the development of a Graduate Enterprise Programme. Given funding constraints, it is important to avoid producing a lengthy list of potential activities and to introduce some prioritisation. A broader agenda or a basic listing of potential activities may dilute the strategic focus and have management and implementation capacity implications in a context of limited funding (see point in section on management and implementation arrangements). • The main focus should be to boost the capacity of Ministries and agencies to develop and launch services that will subsequently, and with the benefit of future funding, become fundamental parts of their mainstream portfolios (such as employment partnerships). A clearer distinction between initial, capacity-building support for service providers and subsequent support for their target individuals and groups in society could be used to develop a more focused list of activities for the first phase of the OP. • Related, more emphasis could be given in the Priorities to building local capacity to design and implement projects successfully. As noted in the draft OP, regional differences in this field are significant in Croatia so the role of local stakeholders in generating and developing projects relevant to their contexts will be important. Thus, measures to support the generation and development of
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project ideas at local level would boost sub-national absorption capacity. This could also support the human resource dimension of the Regional Operative Programs more directly. • Priority 1 could be restructured to include more than one measure. Such a subdivision could sharpen the focus of the Priority and help prioritise activities. Although identified target groups differ, there is also some potential overlap between Priority 1 and Priority 4a as both focus on the development of more active labour market policies in the Croatian employment services (e.g. through the development of partnerships and networks). • The general structure of measures should be reconsidered with the aim of streamlining and harmonising their structure. • There is some overlap between activities under Priority 1 and Priority 2a as both could target the long-term unemployed with active labour market interventions. • Where limited funding will be focused on a limited range of projects, largely concentrated on specific agencies, more detail on selection criteria would also be useful. How have they been developed, what purpose do they serve, is there a hierarchy of criteria?
5.2 Financial tables Financial tables are provided showing the allocation of funding at priority and measure level for each year in the period 2007-09. The figures are disaggregated by EU and national public funding. The tables show that funding for different activities will be introduced gradually over time, with some measures (such as 2b) not receiving funding until 2009. With respect to financial allocations, the OP uses the indicative financial weightings set out in the MIPD as a rough guide. There has been some rebalancing among priorities between drafts, with Priority 3 (dealing with VET and lifelong learning) being allocated more and Priority 1 (access to employment) being allocated slightly less. More detail on how decisions on the allocation of resources and the sequencing of financial flows to different measures over the first three years would be valuable, as would a combined table covering the first three years of the OP.
Table 2: OP financial tables
Priority Axis MIPD Proposed 1 Enhancing access to employment and sustainable inclusion in the 30-40 % 25% labour market. (Improving adaptability of enterprises and workers*) 20-30 % 2. Reinforcing social inclusion and integration of people at a 15% disadvantage.** 3. Expanding and enhancing investment in human capital. 30-40 % 30% 4. Strengthening the institutional capacity of public administration in 10-20 % 20% the employment and training fields. 5. Technical assistance to support OP management and develop a 10% 10% project pipeline. Total 100-140% 100%
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5.3 Horizontal themes A separate section is provided on the horizontal themes (Section 3.4), covering gender equality and sustainable development. Given the types of interventions covered by the OP, there is a strong focus on equal opportunities. There are specific measures related to equal opportunities (particularly concerning the integration of women into the labour market) and this is reflected in some of the indicators and project selection criteria. More generally, it could be useful to include provision for the collation of data sub-sets on the characteristics of beneficiaries (women, old, disabled etc) under particular measures and then to assess the contribution of particular Priorities to the promotion of equal opportunities. This is related to the general need for a stronger use of baseline and target figures in the hierarchy of indicators (see below). There are no specific environmental measures in the OP and the draft only restates broad IPA commitments to comply with EU Environmental Impact Assessment standards. However, particular HRD OP priorities and measures can contribute to environmental themes. For instance, incorporating an environmental perspective into education and training, both on the level of preparing educators and trainers and participants, would make a contribution to the environmental aspects of the sustainable development agenda. Thus the relationship between OP priorities and some horizontal themes could be more closely specified.
6. APPRAISAL OF THE INTERNAL AND EXTERNAL COHERENCE OF THE STRATEGY As noted above, links between the programme and specific Commission guidelines have been made more explicit in second draft OP, particularly concerning SCF, MIPD, European Employment Guidelines and the JIM and JAP documents. Section 3.5 details complementarities with other forms of EU assistance, (notably the CARDS programme), under employment, VET and social inclusion. Coherence with Croatian policies and strategies is generally well covered and Commission strategic frameworks are sufficiently flexible to facilitate integration with Croatian priorities in the programme. However, there may be some issues for further consideration:
• It would be helpful to provide more detail on the programme’s coherence with the Lisbon strategy, which is mentioned as a basic influence on strategic priorities in Section 2.3.1. • In comparison to other aspects of the OP (employment, VET) there is less of a framework of Croatian documents to draw on for social strategy. The decentralisation of social services is a key domestic process and this has been stressed more in the latest draft of the OP, including its impact as a source of employment. However, more detail could be included, perhaps drawing on the JIM document. • More detail should be developed in the OP on links with the Regional Competitiveness OP. This refers to possible synergies between the upgrading of VET or ICT infrastructure in regions and the expansion of services in the HRD OP. As noted above, more detailed information on disadvantaged groups at sub-national levels would support the importance attached to the regional dimension of HRD in the OP. In this respect, reference could also be made as to how the programme’s social inclusion activities will relate to the priorities identified in OP Regional Competitiveness plans. Also, more description could be provided concerning the sort of capacity building initiatives that will be needed at local and regional levels. What support will counties, municipalities and local partnerships receive to further develop their capacity to implement employment, VET and social welfare services?
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• It may be important to demonstrate more clearly how activities listed under OP Priorities build on (rather than duplicate) initiatives launched under the CARDS programme i.e. clarify further the lessons learned. • Stakeholder interviews revealed that experiences of EU and international support programmes, such as MANTRA, INTERREG TEMPUS and CARDS, were generally viewed as beneficial and offered some valuable lessons for the current programming period. Some of the issues identified include: o the role played in developing coordination structures, partnerships and working groups. This applies to the relevant Ministries and agencies at national level but also to the strengthening of links between national and sub-national administrative tiers at and connections with social and economic interests (e.g. through CARDS 2004 Local Partnership initiative); and
o in practical terms, CARDS has also boosted the knowledge and experience in implementing EU funds, notably in terms of developing project proposals. This is providing a vital foundation for the development and implementation of the HRD OP.
o However, a number of partners were critical of the role played by external consultants. In a number of cases, it was felt that their lack of familiarity with conditions on the ground and the cost of hiring consultants was problematic.
7. ASSESSMENT OF EXPECTED RESULTS AND IMPACT In the current draft, proposed monitoring indicators are split into ‘output’ indicators (e.g. number of employment partnerships established) and ‘result’ indicators (e.g. number of unemployed - by specific target group - participating in a given measure who subsequently find employment). In general, work on indicators is still in progress and there are still significant gaps (e.g. no results indicators yet under Measure 4a) and further review is necessary to move towards the ‘input-output-result-impact’ model for SF programmes.
• There is some uncertainty over the categorisation of indicators. For instance, some ‘results’ indicators could arguably be reclassified as impact indicators if these cannot be directly attributable to OP activities (e.g. under Measure 2a, where an increase in the flexible arrangements for women re-entering the labour market by 2010 could be defined as an impact rather than a result). • A more structured hierarchy of indicators should be developed, matching indicators to specific measures and activities and making provision for these to be aggregated at Priority and Programme levels. Context and Programme level indicators should also be developed where possible. • Measuring results could obviously be an issue in the OP due to the inherently long-term, softer impacts involved in some activities but also as labour laws are undergoing reform and this could change the context (e.g. the challenge of capturing the impact of new domestic provisions for ‘work at home’, flexible working etc.). Nevertheless, the OP could incorporate some impact indicators and base lines or targets set for relevant measures in its indicator system (in terms of numbers or percentages). According to interviews, some targets seem to be incorporated at project level and these should inform OP indicators. • In the HRD OP, it is also important that short common definitions are drawn up for all indicators so
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as to ensure that final beneficiaries and those involved in collecting monitoring data are clear with regard to the way in which project outcomes should be measured. This will help avoid problems with regard to the quality and comparability of monitoring data. For instance, there can sometimes be confusion concerning whether number of people trained refers to the number of people enrolled on a training programme or to the number of people completing a training course (without necessarily obtaining a qualification). According to the OP, projects will be required to gather basic data on their activities but also, where relevant, to break beneficiaries down into target groups (by gender, ethnic group, disability etc). Thus a common, basic sheet of agreed indicators and definitions could be developed for projects so that they can develop comparable, collectable data for aggregation that breaks information down into target groups in the relevant measures. • More information on data availability should be provided, in particular whether monitoring can rely on an existing data set, whether new data will need to be generated, or whether only estimates will be available.
8. APPRAISAL OF THE PROPOSED IMPLEMENTATION SYSTEM 8.1 Consultation The consultation process was still in progress during the ex ante evaluation. The description of the consultation arrangements in Section 1.3.1 provides only a broad outline and more detail of the process and its outcome will be added in the next draft. According to interviews, there are still some concerns amongst stakeholders that consultation exercises could have been more inclusive and more open. However, the view was also expressed that increased consultation and partnership has been one of the major impacts of the OP drafting process thus far. The process has contributed to a broader opening of the Croatian system to new partnership arrangements. This applies particularly to links between Ministries, which have been strengthened by the drafting process in the Inter-Ministerial Working Group. The latest partner consultation has also demonstrated the development of links with other agencies and sectors. Vertical structures were used by Ministries to ensure stakeholder participation in this consultation process. At the event, agencies involved in the implementation of the OP (CES, AVET) took the opportunity to describe project proposals to stakeholders. However, there were also some broader, strategic interventions. For instance, there was discussion of the need to emphasise the regional dimension of HRD issues. Given time constraints, ensuring the extent and quality of consultation at regional level at this stage of the OP elaboration process is challenging. However, it is worth noting that CARDS projects has provided a basis for national/regional consultation on HRD issues and projects, as well as a framework for tripartite groups.
8.2 Implementation
Management and implementation provisions are described in Section 5, although there is still some uncertainty concerning the allocation of responsibilities. CODEF will undertake the roles of National IPA Coordinator and Strategic Coordinator (for IPA Components III and IV). MELE will be the Managing Authority for the OP, but operational agreements will be made with MSES and MHSW for their involvement in managing some interventions, subject to the accreditation process. Monitoring Committees – these will operate at two levels: an IPA Monitoring Committee and a Sectoral Monitoring Committee. Appraisal and selection of all project applications will be carried out by a Project Selection Committee (chaired by MELE)
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and Tender Selection Committees (chaired by CFCU as Implementing Body) to select contractors for contracts put out to tender. Membership of these committees will be based on technical expertise.
In the first draft OP it was envisaged that MELE, as Managing Authority, would eventually delegate Implementing Body functions to CES, AVET and other central agencies where appropriate. However, due to the need for accreditation, it was planned to give CFCU in the Ministry of Finance Implementing Body responsibility in the initial phase of the Programme. In the second draft of the OP, reference to CES and AVET has been removed and CFCU alone is noted as the Implementing Body. Some clarification concerning the identity, functions and timetable for the introduction of Implementing Bodies, and their relationship to other management bodies, is required. Other comments are:
• More detail would be helpful on how MSES and MHSW will input into the management and implementation process under the overall management of MELE. • Capacity issues are important. It is important to ensure that the capacity exists for the range of activities listed under measures to be implemented and the funds absorbed. Beyond this, MELE will be taking on MA responsibilities at a time when a new government decree has restructured the Ministry, including a new unit dedicated to EU funds. Also, the CES unit for European Funds, AVET and AAE have all been established relatively recently and this could be taken into account in the OP text. • Effective coordination between institutions and agencies involved in the development and delivery of the programme is essential. With this in mind, details of any coordination mechanisms could be included in the text. • While potential central implementing bodies can be identified for employment (CES) and VET (AVET), organisational support for MHSW under social inclusion is less clear. • The membership and functions of the Monitoring Committee and Sectoral Committee should be specified, as should the relationship between them. • There should be more detail on financial control mechanisms, claims and payment systems. • The OP will gather data on both the progress of projects and details of recipients of assistance (broken down according to gender, ethnic group, disability etc.). Thus, the strength of monitoring and evaluation arrangements will depend on addressing further the issue of the adequacy and quality of data sources and collection mechanisms: the degree to which sources provide the necessary information for evaluation and how easily information can be collected from them.
9. APPRAISAL OF ENVIRONMENTAL INTEGRATION This section considers the characteristics and effectiveness of environmental integration within the Human Resource Development Operational Programme (HRD OP). Insofar as possible, the appraisal is conducted in accordance with the principles of strategic environmental assessment, in particular the information requirements as conveyed in Annex I of EU Directive 2001/42/EC on the assessment of the effects of certain plans and programmes on the environment. In this instance, integration is measured in terms of the perception of environment, coherence with environmental policy and legislation, inclusion and application of
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environmental data, and programme environmental impact. Reference is also made to the consultation process.
9.1 Perception of environment Within the HRD OP, very little mention is made of environment, as the theme is not perceived as central to human resource development. However, provision is made for the effective inclusion of environmental impact assessment, as described below.
There may be scope for extending the perception of environment to include aspects such as employment or training related to the environmental sector, or alternatively when considering social cohesion and social justice, by including environmental quality as a determining feature in quality of life. In this context, for example, unemployment statistics may usefully be compared with data on areas of environmental degradation and linked to information in the Environment Operational Programme in Component III.
Although it would be inappropriate to include environmental themes in a number of aspects of the HRD OP, elements such as environmental targets could assist formation of interlinkages between OPs. This could be reviewed during implementation or on-going evaluation of the OPs. For example, regional cohesion is addressed through activities delivered by the HRD OP but also closely co-ordinated with the activities delivered by the RCOP, promoting possible complementarities and synergies.
9.2 Coherence with environmental policy and legislation The HRD OP includes references to EU Cohesion Policies and Community Strategic Guidelines for 2007- 2013, which focus on the Union’s strategic priorities as expressed in the Lisbon and Gothenburg agendas for a competitive and sustainable knowledge-based economy.
Reference is also made to the Joint Memorandum on Social Inclusion, in which the Government of the Republic of Croatia and the European Commission identified challenges in the fight against poverty and social exclusion. One of these categories concerned the revitalisation and sustainable development of deprived areas.
The HRD OP also describes environmental legislation in Croatia as well as transposition from relevant EU Directives through the forthcoming Environmental Protection Act.
9.3 Inclusion and application of environmental data Sectoral employment data is provided within the HRD OP, drawing international comparison and with some reference to gender distinctions. However, no specific material is provided on the environmental sector, and no references to environment are found in the SWOT analysis. This could be utilised as an opportunity to integrate with measures in the RCOP.
For instance, in Priority 1, which seeks to enhance access to employment and sustainable inclusion in the labour market, survey data could be provided that clarify the potential for training in environmental skills to improve employability and the competitiveness of the workforce, leading to targeted training programmes.
The other priorities – reinforcing social inclusion and integration of people at a disadvantage, expanding and enhancing investment in human capital, and strengthening institutional capacity in the employment and training fields – encompass systemic improvements that could include a number of factors, as well as
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environment. In their present form, neither the examples of activities to be supported nor the project selection criteria directly address environment.
9.4 Programme environmental impact With regard to horizontal themes, the HRD OP contains a section stating that, to ensure that sustainability and environmental protection are taken into account throughout programme management and implementation, a number of procedures will be adopted, as follows:
• Promotion of environmental protection and sustainable development will be included in information and publicity campaigns, and materials will provided during calls for proposals / tender processes. • Applicants for assistance will be expected to demonstrate that their projects will not have a detrimental environmental impact and/or to present how the project will make a positive contribution to sustainable development. These factors will be taken into account in project appraisal and selection criteria. Where appropriate, projects should be compliant with EU environmental impact assessment standards. • Outcomes of the appraisal of environmental impact during the selection stage will be reflected in agreements with beneficiaries, and will be checked, as part of the internal controls and audit process. • The annual implementation reports of the HRD OP will include commentary on operations linked to environmental protection and sustainable development. • The impact of the HRD OP on environmental protection and sustainable development will be considered as part of its evaluation. Environmental impact assessment procedures will be carried out by the Ministry of Environmental Protection, Physical Planning and Construction (MEPPPC) or competent local authority, using existing institutional structures and TA funding will be used to enhance professional capacity.
The HRD OP includes text common to all OPs in Components III and IV with regard to legislation governing environmental impact assessment. The reference in Section 3.4.2 to Directive 2003/35/EC should refer to public participation in respect of the drawing up of certain plans and programmes relating to the environment, rather than the assessment of the effects of certain public and private projects on the environment, which relates to Directive 2001/42/EC, as described in the subsequent paragraphs.
The programme includes references to fulfilling the demands of sustainable development, but environmental impact is oriented principally towards preventing negative impacts. However, scope exists for the HRD OP to generate targeted (positive) environmental impacts, especially within programme measures that could stimulate the environmental sector or support environmental or eco-tourism developments.
On-going evaluations are expected to make an important contribution to the management of the OP, and, in some cases may be conducted on a thematic or cross-sectoral basis with other OPs. This will provide opportunities for appraisal of positive environmental impacts.
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9.5 Consultations The Inter-Ministerial Working Group that prepared the HRD OP does not appear to have included any representation from the MEPPPC.
Prior to the next stage of consultations, it would be useful to provide environmental institutions, agencies and NGOs with an OP summary (including the SWOT analysis, priorities and measures), an explanatory note on IPA and the OP, including the eligible areas of investment and the EC view of priorities to be pursued in the OP. The HRD OP already indicates that the socio-economic partners consultation will be paralleled with a consultation with the wider public and NGO sector, and that the next draft of the OP will describe both the process and the outcome.
9.6 Overview Within the HRD OP, environment is not well integrated. The main issue lies in the HRD OP perception of environment, which places it outside the central concerns of human resource development. Although procedures for environmental impact assessment are to be conducted by competent authorities, opportunities for innovative environmental improvement have been missed. To address this issue, a broader interpretation of environment should be adopted, data related to environmental employment and training could be added to the sectoral analysis, and examples of environmental opportunities could be added to the SWOT analysis. Measures could specify environmental training amongst activities to be supported, and information could be drawn from the Environment OP regarding the location of environmentally degraded areas, further assisting integration between Ops.
10 SUMMARY CONCLUSIONS
The OP provides coherent and accessible coverage of the key issues under Human Resource Development, according to the Commission template for IPA OPs. The OP broadly integrates EU and Croatian priorities in the field. Although there are some gaps in the analysis, it provides a sound basis for the strategic approach taken by the programme. The structure of objectives and priorities flows logically from the analysis, though there could be room for further consideration of the structure of some priorities and measures. Systems for monitoring and evaluation and management and implementation have evolved between OP drafts but some further detail and clarification is required in certain areas.
Taking each of the three main policy headings in turn (employment, education and training and social inclusion), there are some areas where additional information could be added to the analysis, or the text restructured, to strengthen the justification for strategic objectives. Closer attention could be paid to the link between the SWOT and the analysis as there are some gaps and inconsistencies where specific aspects of the SWOT do not relate clearly to issues in the background analysis. There is a need for some further consideration of the structure of the priorities and measures. For instance, a general concern is that there is quite a large variety of activity streams included under some priorities and that these activities vary considerably in their nature and scope. More detail on how decisions on the allocation of resources and the sequencing of financial flows to different measures over the first three years would be valuable. It would be helpful to provide more detail on the Programme’s coherence with the Lisbon strategy and other IPA OPs. Work on indicators is still in progress and there are still significant gaps. Similarly, the consultation process was still in progress during the ex ante evaluation. Currently, the description of the consultation arrangements
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provides only a broad outline and more detail of the process and its outcome will be added in the next draft. Additionally, on the issues of programme management and implementation, some clarification concerning the identity, functions and timetable for the introduction of Implementing Bodies, and their relationship to other management bodies is required. Within the OP, environment is not well integrated. To address this issue, a broader interpretation of environment could be adopted.
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