Future of EU Cohesion Policy after 2020 Jan Gregor Deputy Minister of Finance Czech Republic Strategic planning and future of the Cohesion policy after 2020 Prague, 26 – 27 January 2016

Key factors for the future of the Cohesion policy Budget of the EU Cohesion policy 2014 – 2020 = EUR 366,8 bn (including the transfer to the CEF) The future Cohesion policy budget in period depends mainly on: 1) Development of the error rate (ECA reports) 2) Implementation pace 3) Results of the Cohesion policy implementation - focus on performance budgeting and its link to the European Semester

ECA Annual reports Development of error rates

Implementation delay Many programmes approved only in 2015 –modification of the MFF –11,2 bn. EUR in committ ments transfered from 2014 to 2015 In 2015 cohesion payments for amounted only to EUR10,9 bn. Slow start of implementation helped to reduce the backlog of the period (EUR 8,2 bn at the end of 2015) N+3 decommitment rule and implementation delay will result in high amount of RALs at the end of programming period

Performance and conditionality framework In programming period – introduction of performance and conditionality framework –Performance reserve –Macroeconomic conditionality –Ex-ante conditionality In light of performance budgeting we can expect that these instruments will continue in period in even more complex way

Allocation methodology Cohesion policy – rather transparent and stable methodology since 1999 For period – methodology became very complex –New category of regions – transition regions –EU 2020 priorities reflected –Increased allocation for the unemployed persons – 1100 EUR –Youth employment initiative Transfer of resources from Cohesion policy to CEF in 2014+

Future scenarios? (1) Time to change the allocation method? Payment per village New architecture of the Cohesion policy –categories of regions and their limits 75 % and 90% GDP resp. GNI per capita Minimum shares of the Funds – necessary? –ESF minimum share –Cohesion Fund minimum share

Future scenarios? (2) Period of the next MFF - 5 years? Even more result and performance oriented Cohesion policy Link between the Cohesion policy and European Semester Flexibility of Cohesion policy – ability to adjust to new challenges and priorities Finding a right balance between financial instruments vs. grants

What should be discussed… Traditional policies should be treated in a balanced way – important for the future MFF agreement More coherent approach among Member States needed How to tackle the even more delayed start of implementation Over-regulation in the ESI funds regulation

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