Race on to resume absorption of Community funds

European Regional Development Commissioner Johannes Hahn picks up the baton from the head of the EU Task Force for Greece, Horst Reichenbach, this week, as efforts to extricate the Greek economy from its protracted slump continue.

Reichenbach’s discussions with ministers last week focused on the issues of market liquidity and the disbursement of funds from the European Investment Bank, which Development Minister Costis Hatzidakis predicted will be at center stage this month.

Hahn’s discussions will be dominated by the issue of accelerating projects funded by European investment subsidies under the National Strategic Reference Framework (NSRF), for which Hatzidakis has said procedures will be simplified. It is true that this has been announced several times in the past but the sense of urgency this time is much stronger.

The basic problem with NSRF delays is the system for public works and procurements. The Task Force has been briefed on the problem and has been asked to provide the necessary know-how to expedite the projects. The old and lumbersome legal framework, weighed down by time-consuming and costly expropriation procedures as well as injunctions that can freeze projects for up to a year, needs immediate change. The assumption of responsibility by one person, the new minister, is now giving rise to expectations that the problem will be overcome without too much friction.

Despite sounding like the right decision, the abolition of special secretariats may result in new problems for the NSRF, as these branches of the civil service were responsible for overseeing some of the projects paid for by structural funds.

Hahn’s visit, which begins on Thursday, is expected to highlight the delays that occurred during the recent protracted pre-election period and it is crucial that lost ground is regained in the coming weeks. The deadlines for implementation of the 181 priority projects that the European Commission is targeting and the final winding up of NSRF’s predecessor, the Third Community Support Framework, are fast approaching.

Of the 181 projects, budgeted at a total of 11.5 billion euros, about 80 are facing delays and the implementation of four more is in doubt. Six have been completed while the other 100 are in the process of implementation, without significant problems.

Besides its strong desire to expedite the priority projects, the Commission is also busy rationalizing the NSRF by delisting a large number of small projects which are considered “dead.” These, numbering about 7,500 and budgeted at a total of 5.6 billion euros, failed to be contracted out within six months. The effort, which began in May 2011, has saved about 3.6 billion to date but if the implementation mechanisms are not improved, new “dead” projects are seen undermining overall progress.


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