Analysis of the simplification measures mentioned in both the proposal for a EU Financial Regulation and the cohesion policy legislative package

16 February 2012
Serban Chiorean-Sime (Former Programme Assistant at the EPC), Claire Dhéret (Head of Social Europe & Well-being programme and Senior Policy Analyst) and Fabian Zuleeg (Chief Executive and Chief Economist)

This paper was produced by Claire Dhéret, Fabian Zuleeg and Serban Chiorean-Sime.

On 22 December 2010, the European Commission adopted a proposal for a Regulation of the European Parliament and the Council of the European Union on the financial rules applicable to the annual budget of the Union (COM (2010) 815 Final), also known as the EU Financial Regulation.

This legislative proposal will have a major impact on local and regional authorities due to the simplification measures it includes, particularly regarding the use of EU Structural Funds.

Furthermore, on 6 October 2011, the European Commission adopted a legislative package for cohesion policy during the period 2014-2020, which contains a set of additional simplification measures.

This file note seeks to assess whether the Commission’s proposed measures match the needs expressed by Local and Regional Authorities (LRAs) and whether they will contribute to more efficient and effective spending.

The first part of this file note describes the state of play of inter-institutional negotiations on the EU Financial Regulation, provides a summary of the main simplification measures, and compares the measures proposed in the Financial Regulation to those proposed in the cohesion policy legislative package.

The analysis of inter-institutional negotiations on COM (2010) 815 (final) shows that the changes negotiated between the European Parliament and the Council of the European Union are broadly supportive of the position expressed by the Committee of the Regions (CoR).

The overview of the simplification measures draws attention to the fact that some ‘simplification measures’ do not necessarily facilitate the use of EU Funds by beneficiaries. Overall, the comparison between the measures proposed by the Commission indicates that, generally, both proposals are coherent with each other, although the level of detail can vary depending on the specific topic.

The second part of this file note examines the degree to which the simplification measures respond to the needs expressed by LRAs, evaluates their impact on the use of EU Funds, and points out a number of measures that will require changes exclusively for LRAs and national governments.

Some simplification measures seem to go in the right direction and aim to, for instance, reduce the administrative burden on both beneficiaries and managing authorities, which has been called for repeatedly by LRAs and the CoR.

However, the overall impact of the proposed measures might not be clear-cut with regard to simultaneously achieving both objectives, i.e. simplified use of Funds by LRAs and more efficient and effective spending.

Last but not least, it might take time to see the positive effects of simplification.

This paper was written under a Framework Contract with the Committee of the Regions on the EU budget.

To read the paper, please click here.