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8/13/2019 EU Structural and Cohesion Funds
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Business 2000E I G H T H e d i t i o n
www.business2000. ie
THE EUROPEAN UNION
In 2004, European Union (EU) membership increased from 15 to 25 Member States. When two more
countries (Bulgaria and Romania) join in 2007, the EU will have a population of approximately half a billion.
All EU countries are committed to peace, democracy, the rule of law,and respect for human rights; and
they work together to promote these values in the wider world. To become more competitive and
prosperous,the EU is creating new and better jobs and giving its citizens new skills.In partnership with
its near neighbours, the EU is also working to spread prosperity and progress beyond its borders.
THE COMMUNITY BUDGET
The EU has to plan its work well in advance and ensure that it has enough money to pay for its objectives.The
main EU institutions (Parliament,Council, and Commission) agree in advance on the priorities for the
next few years and develop a spending plan or financial perspective.A financial perspective states
the maximum amount the EU can spend, what it can spend it on,and where the money will
come from.The current financial perspective runs from 2000-2006. Over the course of
time,the EU budget has changed to reflect different priorities within the EU.
The EU budget is a mix of its own resources and direct contributions by Member
States.The EUs own resources are revenues from levies on agricultural imports,
customs duties on other imports, and a portion of value-added tax (VAT)
income. In 2003, the EUs own resources accounted for one quarter of the
revenue of the overall EU budget.
Contributions from Member States account for three quarters of the EUsrevenue.Member States contribute a percentage of gross national income.
As this is a measure of national wealth,the formula ensures that each country
contributes according to its means.The money is then spent where it is needed
most.
EU money is used to support a whole range of EU policies.The largest portion of
the budget is allocated to agriculture, which now accounts for 45% of EU spending.
Regional Policy which is implemented through investment by the Structural and
Cohesion Funds represents the second largest budget item, taking approximately one
third of total expenditure.The remaining EU money is spread across a wide range of policies
including helping the Third World, emergency aid assistance, educational and training
programmes,research and development,health and consumer protection, to mention a few.
EUROPEAN REGIONALPOLICY - BOOSTING
ECONOMIC DEVELOPMENT
European Regional Policy is a policy of promoting solidarity. It allocates
more than a third of the EU budget to reduce the development gaps
among the regions and the disparities among EU citizens.The EU uses the
policy to help lagging regions to catch up, restructure declining industrial
regions,diversify the economies of rural areas with declining agriculture,
and revitalise declining city neighbourhoods. It sets job creation as its
primary concern. In a word, it seeks to strengthen the economic and
social and territorial cohesion of the EU.
Since 2000, Regional Policy has
provided considerable assistance
to the economic development
of the countries applying for
accession to the EU. On 1
May 2004, 10 new
Member States joined theEU.This major event was a
historic opportunity for
Europe and a challenge for
Regional Policy. On that day,
the range of disparities within the
EU was enlarged. It is necessary for
the EU to respond to the enormous needs
of the new Member States and also to the difficulties that remain in the
rest of the Union.
The monies used for implementing Regional Policy and boosting economic
development are the Structural and Cohesion Funds.
EU Structural Funds
The Structural Funds were created to help those regions within the EUwhose development is lagging behind.
The Structural Funds aim to:
develop infrastructure,such as transport and energy;
aid regions affected by industrial decline;
support the development of rural areas;
extend telecommunications services;
provide training for workers;
combat long-term unemployment;
disseminate the tools and know-how of the information society;and
promote research and development.
The Four Funds
The EU Structural Funds consist of four individual funds.The funds work
together by supporting different aspects of regional development.
1. European Regional Development Fund (ERDF) - Promoteseconomic and social cohesion within the EU by reducing imbalancebetween regions or social groups.I n Ireland,t he ERDF provides supportfor road development, public transport projects such as LUAS andQuality Bus Corridors (QBCs), micro-enterprise development through
the County Enterprise Boards,Tourism Projects,and waste management.2. European Social Fund - Aims to help, prevent, and combat
unemployment; to equip Europe's workforce to face new challenges;and to keep people in contact with the labour market. In Ireland, theESF supports the National Employment Service (FS), SchoolCompletion Initiatives, Early School Leavers,Third Level Access Initiatives,Skills Training and Traineeships, In Company Training and Life-longLearning Initiatives, Promotion and Monitoring of Equal Opportunities,and Childcare Training and S taffing .
3. European Agriculture Guidance and Guarantee Fund -
Contributes to the structural reform of the agricultural sector and thedevelopment of rural areas. In Ireland, the EAGGF supports ruraldevelopment through the LEADER programme. Other initiativessupported include Farm Waste Management, Improvement of DairyHygiene Standards and Forestry.
4. Financial Instrument for Fisheries Guidance - Supports thestructural reform of the fisheries sector.In Ireland, the fund supportsdevelopment of fisheries harbours, aquaculture development,measures
to adjust the fishing fleet, renewal and modernization of the whitefishfleet and smaller scale inshore vessels, support for conservation andstock management, fish processing,and training.
THREE OBJECTIVES
Regions within the EU are classified for financialsupport depending on the economic difficulties
they encounter.There are three types of regions(Objectives) that receive financial supportfrom Structural Funds.The most significantObjective (in terms of resources allocated)is Objective 1.
Objective 1 Helping regions whosedevelopment is lagging behind to catch up,i.e., providing them with the basicinfrastructure or encouraging investments inbusiness economic activity. Some 50 regions,representing 22% of the EUs population areincluded.
E I G H T H e d i t i o n
NDP - EU Structural and Cohesion FundsBusiness 2000
N a t i o n a l D e v e l o p m e n t P l a n
EU STRUCTURAL ANDCOHESION FUNDS
Childcare Centre Drumshambo
Co.Leitrim
Galway-Mayo
Institute of Technology
Cavan Innovation
& Technology Centre
M1 Boyne Bridge
8/13/2019 EU Structural and Cohesion Funds
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