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Transitional Euro funds will help priority areas - McConnell
28/10/1999
Significant amounts of transitional funding will be available to help high priority areas which are no longer covered by the European Structural Funds Objective 2, Finance Minister Jack McConnell said today. He also stressed that the new round of European Structural Funds programmes should complement the policy objectives of the Programme for Government.
Speaking on the day that Structural Funds were debated in the Scottish Parliament Mr McConnell said:
"I am today writing to the Plan Teams to ensure that their development plans for Objective 2 programmes concentrate transitional funding on the highest priorities for support.
"We have targeted significant areas of need throughout Lowland Scotland for full Objective 2 coverage. But these are not the only areas which will receive support. Other, smaller areas of need in the transition areas will also receive funding to be worth some £75 million over the length of the programmes. It is these areas - which only narrowly miss full Objective 2 status - which I want to see targeted for resources. These will include strategic economic opportunities which make a significant economic impact, or support smaller measures in socially deprived areas. I want these plans to make links with our policy objectives and focus resources properly. I look forward to receiving the proposals from the Plan teams, to put forward to the Commission.
Mr McConnell also stressed that European Structural Funds should complement the policy objectives of the Executive's Programme for Government. He said:
"European Structural Funds support and complement important policy objectives in many areas which are the responsibility of the Scottish Parliament. They are not peripheral to the work of the Parliament but allow resources to be directly targeted to add value to our own specific policy initiatives. Moreover they allow us to target support on areas of real need throughout Scotland.
"In particular Structural Funds:
* support business development and innovation
* back up our important social inclusion priorities
* expand and develop lifelong learning, work related training and training for the unemployed
* promote equal opportunities;
* prioritise sustainable development and environmental protection - including the promotion of renewable energies and energy efficiency;
* support new technologies and the development of the information society;
* support sustainable jobs in tourism and the cultural and natural heritage: and
* provide valuable support for co-operation between Scotland and other regions of the Community through important programmes such as Urban and Leader Plus and programmes linking the Northern Periphery.
"In addition all parts of Scotland will be able to bid for support from the new Objective 3 programme, designed to support European and national employment objectives. We have now reached agreement with colleagues in London and Cardiff that the new programme for Scotland will be worth some 480 million euros (currently worth some £320 million) over the seven year period. This represents some 10.5 per cent of the allocation to the UK as a whole. This will provide the basis for a substantial Objective 3 programme and we will now act quickly to finalise the training plans which will continue to contribute to Scotland's improving economic position."
BACKGROUND
1. European Structural Funds are designed to promote economic and social cohesion throughout the EU. There are three main strands: Objective 1 designed to bring the poorest regions of Europe closer to the average GDP for Europe; Objective 2 designed to help those regions experiencing particular difficulties in economic restructuring; and Objective 3 designed to meet training needs throughout the EU.
2. The new Programme Round will run from 2000-2006. Following the last European Summit in Berlin in March it was agreed that a special programme for the Highlands and Islands should be established worth 300 million euro over the length of the period, roughly equivalent in financial terms to the previous Objective 1 programme for the area. In addition Scotland qualifies for assistance under Objectives 2 and 3. Budgets for Objective 2 are not yet fixed but are likely to be of the order of 600 million euro (£375 million at current exchange rates) for areas with full eligibility and 125 million euro (roughly £75 million) for transitional areas.
3. The forthcoming enlargement of the EU makes it likely that this round of Structural Fund programmes is likely to be the last round from which Scotland benefits significantly.
4. The Scottish Executive will shortly be submitting proposals for plans for the implementation of the Highlands and Islands special programme to European Commission. Plans for the Objective 3 programme will be finalised after consultation with the Parliament's European Committee before being sent to the Commission before Christmas and early in the New Year detailed proposals for plans for Objective 2 programmes in West, East and South Scotland will be submitted.
5. On 8 October the UK Government proposed to the Commission areas for coverage by the new Objective 2 programme. The Commission is expected the decide on final coverage in the next few months. The proposals for Scotland, which were based on recommendations by the Scottish Executive, envisage coverage of over 2 million of the Scottish population. In addition areas including a further 2 million will be eligible for transitional support.
News Release: SE1067/1999
28 Oct 1999