Ref. Ares(2019)1659727 - 13/03/2019

EUROPEAN COMMISSION DIRECTORATE-GENERAL REGIONAL AND URBAN POLICY

Political and Inter-Institutional Coordination and Document Management

Minutes

Meeting of the 10th Structured Dialogue with European Structural and Investments Funds' partners group of experts

28 February 2019, Brussels

I. APPROVAL OF THE AGENDA The Commission (DG REGIO) announced the agenda, which was approved.

II. NATURE OF THE MEETING The meeting was public, i.e. recorded (available to anyone inside and outside the ) but not web-streamed. It was an ordinary session dedicated to providing an update on the negotiations of the legislative package 2021-2027; the links with the European Semester, programming for the period 2021-2027; state of progress of implementation and the Open Data platform and presentation of the new policy objective 5 Europe close to citizens as proposed by the Commission.

III. LIST OF POINTS DISCUSSED 1. Update on the negotiations of the post-2020 legislative package The Commission (DG EMPL) presented the state of play of discussions on the ESF+ regulation including the amendments proposed in the European Parliament report (increase of the ESF+ budget to €120.5 billion; specific objectives extended to certain target groups and actions; additional thematic concentration requirements, compulsory earmarking for YEI amongst other). On the Council side, DG EMPL mentioned the amendments proposed in the provisional agreement as regards the specific objectives of the fund such as the addition of “disadvantaged groups on the labour market” to specific objective 1 on access to employment, the split specific objective III into two. No questions nor comments from partners followed this presentation.

The Commission (DG REGIO) presented the state of play of co-legislative discussions on the Common Provisions Regulation (CPR), the Regulations proposed for the ERDF, the Cohesion Fund, and ECBM. A first reading vote in the Parliament had taken place for ECBM, while a target date for first reading on the other texts (CPR, ESF+, ERDF/CF, Interreg) is planned for April.

1 The main amendments proposed by the European Parliament to the CPR included: extension of CPR to the EAFRD, strengthened partnership with empowerment to amend the code of conduct, extended coverage of partnership agreements, limitation to the (optional) transfers to investEU, new transfer possibility to , extension of cross-financing between ERDF and ESF, extension of criteria for selections (art 67) and possibility to recourse to actual costs for TA among other and maintaining major projects above EUR 100 million.

The main changes proposed in Council for the CPR included: restricted text on partnership, with mere reference to the code of conduct, partnership agreement optional for Member States with less than 3 programmes or with allocation < EUR 2,5 billion, restriction of criteria for selection, consultation of COM, reference to 2014 EIA Directive, climate proofing replaced by impact assessment on climate, limited reference to consistency with smart specialization strategies, deletion of the reference to EPPO, possibility to recourse to actual costs for TA, possibility to submit reimbursement for unfulfilled enabling conditions and revision of the midterm review mechanism: “flexibility amount” corresponding to 50% of 2026 and 2027 allocation among other.

REGIO also presented the state of progress of trilogues which focused on block 1.

REGIO also presented the main changes of the Parliament and Council proposed for the ERDF Regulation. Parliament proposed: moving digitalisation from PO3 to PO1, eligibility of administrative support to public authorities, reviews thematic concentration (applicable at category of regions, lower thresholds for PO1 and introduction of requirement for category 1 under PO2, possibility to reduce requirements by 5 or 10%), derogations under article 6 and increase of minimum requirements for urban development to 10%. Council proposed moving public transport from PO3 to PO2, opening on financing support to large enterprises (to small midcaps), openings in article 6 (exclusions), airports, security and safety, treatment of residual waste: phasing possible, fossil fuels, opening (1% of ERDF / CF) for supporting transition from coal to gas), deletion of article 8 and article 9(1), specific allocation for outermost regions not subject to thematic concentration among other. Finally, REGIO presented the main changes proposed by the European Parliament for INTERREG.

CAN Europe asked why the horizontal principles were not mentioned such as gender equality, sustainable development and climate proofing. CME United highlighted how fundamental partnership is in cohesion policy, expressing concerns about the Council’s position on it, and asked about the Commission’s position on Article 6 vis-à-vis the Council. EURAF asked about the sustainable agenda and the possibilities of reimbursements under CPR.

REVES asked if the Commission would accept the Council’s removal of Articles 8 and 9 of the ERDF regulation, which includes instruments that aim to ensure the efficiency of spending and bringing the EU closer to citizens. EURADA asked about the Council’s position on climate impact studies, resilience and smart specialisation. EESC noted with satisfaction that the EP wanted maritime cooperation to be reintegrated in the Interreg regulation and asked about the Commission and Council position on this matter.

Atlantic Cities (ex-CAAC) asked whether the composition of monitoring committees for Interreg programmes would be identical as for other mainstream programmes in terms of participation of civil society and asked whether there was the intention to continue with macroregional strategies. Eurocities asked about the budget for URBACT. COPA-COEGECA noted that it is important to have same rules for cohesion policy and rural development.

2 CEMR-CCRE noted also for the period 2014-2020 the code of conduct has been adopted later than the start of programming and inquired about the delays in the strategic plans for CAP/rural development. EURoma asked about tools available for transnational cooperation, the role of the Commission in supervising the implementation of the funds and called for more emphasis on social inclusion. EUROCHILD asked clarifications about the mid-term review mechanism and the links with the European Semester.

DG EMPL and DG REGIO gave factual clarifications on all the points received noting that the Commission has been maintaining its initial proposals.

The Commission (DG AGRI) presented the state of play of the negotiations on the CAP and rural development. Contrary to Cohesion Policy, no mandate has been agreed by any of the two co-legislators. The intention of the Romanian Presidency is to progress as quickly as possible. Presidency is working based on a partial general approach. More than 8000 amendments have been tabled by the EP on the three CAP regulations, some 6000 of which concern the CAP Strategic Plans Regulation. In his reply to a question asked in the meeting, he noted that the integration of the EAFRD in the CPR would lead to a very complicated legal framework, notably due to the fundamental differences in the delivering model of the future CAP compared to Cohesion Policy. At the same time, he confirmed that the EAFRD would still contribute to the achievement of the goals linked to territorial cohesion. If needed, Commission will timely provide transitional rules, to ensure continuity in rural development support. DG REGIO (on behalf of DG MARE) gave an update on the state of progress of negotiations on the EMFF with the report of the lead European Parliament Committee to be voted in April plenary and partial general agreement expected in Council in June.

CERM-CCRE asked about the application of the partnership principle in the CAP. EAPN expressed concerns that the EAFRD would not support social objectives. DG AGRI stated that the proposed CAP legal framework proposes clear rules to involve partners in the implementation of the CAP and reassured that the EAFRD would continue to play a key role in supporting social objectives in rural areas.

2. Alignment with the European Semester; programming, negotiations The Commission (DG REGIO) explained the reinforced links proposed between cohesion policy and the European Semester, underlining the new features of the country reports including analysis of regional disparities and Annex D identifying Cohesion policy relevant investment needs for Member States.

DG REGIO outlined the main stages of the upcoming programming process including the events launching programming between early March and mid-April in Member States (organised back to back with the events on the European Semester). She stated that the code of conduct (CoC) on partnership is valid already at the programming phase. Member States are being asked to give the Commission a roadmap by June on programming. The Commission’s objective is to adopt all partnership agreements and programmes by the end of 2020. The Commission is hopeful that a provisional agreement can be reached on programming during the current trilogues.

ENIL showed concerns over weakened provisions on de-institutionalisation including Commission control of Member States compliance to use the funds. EDF asked about the date of the events launching programming and how to get an invitation.

3 CEMR asked why PO5 is not relevant to all Member States and inquired about the partnership mechanism in the context of the European Semester. CERM-CCRE commented that there were high investment needs in Germany in education although PO3 were not identified as a priority.

DG REGIO stated that the dates of the launch events would be shared with partners after the meeting noting that, while the schedule was fairly stable, it still represented a moving target. Partners may contact the Representations of the European Commission in Member States if they wish to participate. On missing investment needs in some Member States, she stated that cohesion policy could only address some investment needs, not all. The level of development, available budget, and requirements for thematic concentration are all taken into account; moreover, investments in certain policy objectives are recommended where there exist major gaps when EU funds could truly help. The CSRs had their own process while reassured that discussions would still take place on how the problems present in the recommendations could be solved.

DG EMPL said that if a Member State does not respect the Charter of Fundamental Rights when they implement the funds, the Commission could remove its investment support in that country. On partnership, DG EMPL indicated the possibility of revising the code of conduct on partnership, if co-legislators decide to do so, in particular on the rights and duties of each partner. DG EMPL expressed their wish to have a balanced representation of all stakeholders and interest, as well as a good participation of everyone in the projects implementation.

3. 2018 Summary Report on the Annual Implementation Reports The Commission (DG REGIO) presented the main highlights of the 2018 Summary Report and gave a live demonstration of the latest features of the Open Data platform. He noted that the platform included a wealth of structured data, progressively made available. He showed various visual aids to understand how programmes perform. He displayed how to navigate the platform by theme, objective, project examples, and achievements (common indicators) broken down by Member State and fund. He emphasised that the information was dynamic and partners can create their own charts, and interact with then. He stressed that this platform represents an unprecedented efforts to ensure transparent access to programmes and their progress.

COPA, EURAF, CERM, Atlantic Cities, EURoma and COPA-COGECA congratulated the Commission for the impressive platform. COPA asked if the platform was showing the animated ‘flying flags’ chart for individual countries or regions, how the decided projects are categorised as social inclusion under EAFRD, and what would happen to the platform after 2020 for the future cohesion policy. EURAF asked if the platform could be used for data mining to find understand what works of needs to be better addressed and improved for future programmes, identify relevant data on time that can help avoid bad spending and use it for civil dialogue. CERM wondered if the platform could be translated in other languages to make it accessible to people. EURoma asked if funds could be combined with themes and for whom is the database intended.

The Commission emphasised that the platform is the result teamwork where the programme authorities, many Commission colleagues and consultants contributed. To date the new animated graphs are present on the Fund and Themes pages.

4 The data is available and the Commission will consider presented by Member States during 2019 in order to show how different programmes are working. A brainstorming would take place in the Commission on the use of the platform for the post-2020 cohesion policy. It is clear that for cohesion policy open data as a policy will continue and intensify. The data can help identify areas which appear to be slower to implement. However, the data alone does not explain what is happening and whether implementation can be addressed and adjusted. On languages, unfortunately, DG REGIO said it was costly and there were technical limits to translation. Translating the datasets would be problematic because there are many data and many texts for each data. Some international organisations (UN, WHO) tested having open data sets in different languages but it did not really work because the audience was mostly specialised and was using/understanding English only.

4. Europe closer to citizens: the new policy objective 5 DG REGIO presented the rationale of this new policy objective, and provided an overview on the different territorial instruments (ITI, CLLD, other) proposed to bring European cohesion policy closer to citizens. DG REGIO summarised the lessons learned so far in the 2014-2020 programming period, and explained the flexibility of PO5 and the various territorial tools to take into account specific territorial and local challenges and potentials.

DG REGIO then presented an overview of the legal framework for 2021-2027: CPR, funds specific regulations (ESF+, ERDF/CF, EMFF, ETC), the second CAP pillar EARDF, and explained how the proposals tried to simplify the administrative procedure for integrated territorial development, for instance by putting together 11 previous objectives into only 5, including the new cross-cutting policy objective 5. DG REGIO presented afterwards the new article 22 CPR and article 9 ERDF/CF for integrated territorial and sustainable urban development.

DG REGIO explained the streamlined minimum requirements, and highlighted that there is no need to identify intermediate body for the minimum scope of responsibilities delegated to urban, territorial and local bodies, which is a novelty. For better monitoring the territorial focus of integrated territorial development, including the specific focus on urban areas, as well as other targeted interventions, he presented the new categorisation in CPR Annex 1. In order to ensure early start of the next period, the territorial and local actors should act proactively and start revising and updating their strategies. To better support the design, implementation and monitoring of sustainable urban development, the ERDF/CF proposal put also forward a more coherent framework for administrative capacity building, cooperation and experimentation in urban development with the new European Urban Initiative.

The Commission (DG AGRI) carried on with outlining how the proposal for the CAP post- 2020 links up with the territorial development support under the other ESI Funds. DG AGRI confirmed that the CAP would retain its territorial policy elements, with LEADER being the main delivery mechanism. The CAP legal proposal includes these territorial elements in its CAP policy objectives, specifically in general objective 3 and specific objective 8 (Art. 5(c) and art. 6(h) of the proposed CAP strategic plan regulation). He insisted that the territorial development support under the EAFRD would be fully coordinated and methodologically aligned with CLLD activities under the other ESI Funds.

This is ensured by the fact that LEADER will be implemented based on the CPR articles on CLLD with no second layer of CAP fund specific rules.

5 Furthermore, coordination and complementarity of support to LEADER with CLLD activities of the other ESI Funds will be ensured. Member States will have to provide an overview in their CAP Plans of the coordination, demarcation and complementarities between the EAFRD and other Union funds active in rural areas. On this basis, it was clarified that the different kinds of concrete linkages between the EAFRD and the cohesion policy in place today would remain in place in the post-2020 period. This is especially true for multi-fund initiatives such as ITI and CLLD/LEADER, as well as the shared objective to support Smart Villages.

The Commission (DG EMPL) underlined a few features of ESF+. She recalled that CLLD and other territorial tools were instruments, not means to an end. As such and similarly to the current period, MS will be able, if they wish to, to use the ESF+ to support territorial tools - provided the ESF+ funded interventions contribute to the objectives of the Fund. It is up to MS to choose which approach works best for them, bearing in mind that ESF+ resources can only be programmed under Policy Objective (PO) 4, while they may, and will, contribute to other POs such as PO5.

The Commission (DG MARE) said a few words on CLLD from the fisheries perspective. Stakeholders in recent consultations recognised the important role played by CLLD in fisheries in providing local solutions to local problems. They recognized CLLD as a valuable opportunity for the fisheries and aquaculture sectors to play an active role in local government and governance issues. Many would like to see CLLD playing a wider role in the development of the blue economy at local level. DG MARE agrees and want fisheries communities to become drivers of coastal development, local economic diversification and job creation, by tapping into the unexploited potential of the local blue economy and teaming up with innovators and investors. That is why the EMFF regulation - under priority 3 - would allow for the continued support of the sustainable development of local economies and communities through CLLD and would ensure that local communities better exploit and benefit from the opportunities offered by the sustainable blue economy, capitalizing on and strengthening environmental, cultural, social and human resources

ELARD regretted for the LEADER programme that is allegedly not used enough in MS, and asked how to implement the SMART villages policies. CEMR, about CAP, marvelled if the same co-financing opportunities apply to other funds, and if the rules stayed the same.

DG REGIO replied on SMART villages, correcting ELARD who had expressed it was a specific instrument for agricultural development. It is not a specific instrument but a relevant initiative for integrated territorial development. As such, all the three instruments proposed in the regulation can be used flexibly to support SMART villages initiatives in Member States.

DG AGRI, for the CAP, clarified that the rules on the content and the cooperation of programs stayed the same, all under CPR. The dissimilarities stand in the financial operation and their implementation only, she explained. For CAP, the application would be more based on results. DG AGRI proposed combining funds, as well as the idea to have a ‘lead fund’ (i.e. a dominating fund), from which we would apply its rules to the other funds. There would also be the option of funds coordination. As for LEADER, DG AGRI, for the next CAP, proposed a co-financing of LEADER of 80%, which could plausibly increase its application by MS. CEMR-CCRE added that they do not know what would happen to the MS in implementing the new delivery modes for LEADER, saying that the co-financing rates differed. DG AGRI replied that the 80% was a maximum rate.

6 ELARD thanked the explanation, that SMART villages initiatives can be supported with the territorial tools, but worried about the CAP exiting CPR which could create complication, showed concern towards the complexity of the rules and approaches of coordination, and stated that the Commission should rethink them or it could be too confusing. CPRM wondered about the Council position on the PO5 for outermost regions and islands, and if commission foresee special instruments to help the managing authorities in these territories? Energy Cities looked for a confirmation that PO5 was horizontal. Atlantic Cities asked what is the relationship with the territorial cooperation under Interreg and macro-regional strategies, and how functional areas will be defined. CEMR-CCRE asked why this policy objective is not mentioned in certain European Semester Country Reports.

DG REGIO noted that PO5 would be open to all type of territories, with specific objectives (urban and other territorial challenges). There are development strategies on islands, which take into account the specific geographic and demographic hindrances. On the specific technical assistance to islands, DG REGIO mentioned the Clean Island initiative recently launched, and expressed that the tools of cohesion policy can provide an important contribution for that initiative. For outermost regions, ERDF tools would play an important role for PO5. For macro-regional concerns, DG REGIO confirmed that Interreg and mainstream programmes offer opportunities to support them. For transnational, rivers, and mountains regions, it was simply the diversity of the macro-regions and geographical territories that prevented naming them in the regulation. In the programming documents, there will be no single methodology from the Commission on what and how urban or other functional areas should be defined.

Policy actions and interventions require functional and operational definition, therefore it will not be limited to, for example, NUTS regional typologies. PO5 is horizontal in nature; it is a vast policy objective that can use all investment categories and indicators, and can be combined with the tools for integrated territorial development. On the Semester Country Reports, DG REGIO explained that for some countries, regional disparities and urban territorial dimension were mentioned in the framework of other relevant policy objectives.

IV. AOB: CONCLUSIONS/RECOMMENDATIONS/OPINIONS DG REGIO informed partners about files adopted by the Commission that are relevant for cohesion policy. This included the Reflection Paper on Sustainable Europe by 2020, including its three scenarios, the contingency framework proposed for the EU budget in the context of Brexit preparednesss and the European Semester Winter Package. DG REGIO also outlined the state of progress of two cohesion policy legislative files including the proposal to reduce pre-financing for cohesion policy programmes for the period 2021-2023 from 3 % to 1 %; the proposal increase of the budget for the Youth Employment Initiative and delegated acts following last year’s adoption of the Omnibus legislation. DG REGIO also outlined the main upcoming events organised by the Romanian Presidency.

COPA expressed concerns about the new EU political leadership modifying the MFF sectoral proposals on the table. Social Platform asked when we could expect more information on the Sustainable Europe 2030 Agenda. The Commission reassured that the proposals remained on the table and that the Reflection Paper on Sustainable Europe followed the same logic, as previous reflection and more information would be shared.

7 Finally, DG REGIO summarised the main takeaways of the meeting: noting the focus on programming in the co-legislative negotiations; encouraging partners to be engaged in the programming process in Member States, participate in events launching the programming; use the wealth of structured data included in the Open Data Platform to the maximum as well as consider the new possibilities offered in the context of the proposed policy objective 5 Europe closer to citizens. All presentations are available on the group’s page on Inforegio.

V. NEXT MEETING The next meeting will take place in the autumn, the date to be defined. Partners will be invited to submit suggestions for points on the agenda.

VI. LIST OF PARTICIPANTS Atlantic Cities Business Angels Europe BUSINESSEUROPE CAN Europe CCRE-ECCR CCRN CEEP CEETAR COGECA COPA CoR CPMR EAPN EARTO EASPD ECOLISE EDF EESC ELARD Energy Cities ENIL ERRIN ETUC Euclid Network EURADA EURAF Eurochild Eurocities EuroHealthNet EURoma European Boating Industry European University Association FEANTSA Housing Europe

8 IFOAM LUMOS MedCities PREPARE REVES SMEunited Social Platform

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