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Synthesis Report Ex-post Evaluation of the ERDF 2000-2006 accounted for around half of the total public resources devoted to RTDI in these regions over the period. Moreover, it had some success in the form of: • fostering an increase in expenditure and involvement of enterprises in R&D activities; • funding good quality projects, even if these were mainly aimed at encouraging the adoption of up-to-date, but already available, technology, rather than supporting new innovation; • some 90% of the research projects funded resulting in the products concerned being produced or the processes being adopted; • helping to establish new links between businesses and research centres, 50% of the projects funded leading to such links being formed. The effectiveness of the programme, however, was marred by the length of administrative procedures (selection and contracting) and by a monitoring system limited to administration rather than the identification of results which could inform future project selection. Other elements of enterprise support policy in Objective 1 regions were less successful. Evaluations point to the limited effects of investment grants, their large deadweight costs and a lack of a clear industrial policy against a background of globalisation which affected lagging regions disproportionately and gave rise to the need for shifts in the structure of economic activity. Although local infrastructure was built and public services were generally improved over the period, with positive effects on the quality of life, the gap in these respects in relation to the North of Italy remained wide. Moreover, the improvements proved insufficient to attract new investment, partly because investment was fragmented, often on a small scale and not part of a wider strategic plan. Nevertheless, in many rural areas, historical centres were saved from ruin, so increasing their tourist potential as well as improving the local quality of life. The projects concerned also encouraged local partnership and greater participation of local people in decision making. At the same time, cohesion policy contributed to the fight against organised crime, which has long been a major obstacle to economic development in the South of Italy. While it was not the principal cause, it was one factor behind the growing refusal of businesses to put up with criminal extortion as in the past, which is gradually enabling a stronger market economy to emerge. The attempt to improve the effectiveness of public administrations also had some success, if limited. Although the ‘n+2’ rule was almost fully respected and the funding available was spent, major reasons for this were: • the widespread use of ‘pre-funded’ projects, or those which were already underway and, in some cases, nearing completion and had received funding from other sources (at the beginning of 2008, such projects accounted for over a third of the total value of the main Operational Programmes 44 ); • the prevalence of small projects, which were easier to manage or replace by others if problems arose, with a consequent fragmentation of intervention. 44 The largest use was in the Transport OP (71%) and the Campania OP (43%). See National report on ‘Freed resources’ in Objective 1, DPS, 2008. 126
Ex-post Evaluation of the ERDF 2000-2006 Synthesis Report The preference of the administrative authorities for small projects was reinforced by the complicated nature of the bureaucracy, which discouraged large-scale projects from being initiated. Equally, monitoring and evaluation increased in importance and all programmes were subject to both according to EC guidelines. However, while evaluations provided a large amount of information: • this was often interpreted in a very formal and restricted way and was not put to constructive use; • the evaluation units in the Ministries and regions spread a culture of evaluation but failed to increase true evaluation capacity, since many relatively simple and routine tasks were contracted out to technical assistance agencies, so preventing internal staff from gaining know-how and building capacity. Germany Support from the Structural Funds going to the Objective 1 regions in the East of Germany over the period 2000-2006 was slightly smaller in relation to their GDP than in the Southern Italian regions (at around 0.65%), most of it coming from the ERDF, though if Berlin (part of which received phasing-out funding under Objective 1 and part, Objective 2 funding) is excluded, the relative amount is increased closer to that in Italy. Germany like Italy experienced relatively slow growth of GDP per head over the period, if not quite so slow (around 1.4% a year). Growth in the Objective 1 regions, excluding Berlin, however, was much faster than in the rest of the country (around 2.5% a year), so that regional disparities narrowed over the period. According to the HERMIN model, the Structural Funds are likely to have contributed significantly to this narrowing. At the same time, there are marked differences across the Objective 1 regions, which tended to widen over the period, with the less prosperous regions in the North (Mecklenburg-Vorpommern and Brandenburg) growing at a much slower rate than the more prosperous ones further South (Halle, Dresden and Magdeburg). Like in Italy too, EU funding compensated in some degree for the reduction over the period in national funds for investment, which remained small as compared with the amounts devoted to assisting the development of these regions in the first half of the 1990s. Nevertheless, national funds, made available under the ‘Joint Task’ (Gemeinschaftsaufgabe "Verbesserung der regionalen Wirtschaftsstruktur"), which is partly financed by the Structural Funds, represented the major source of support. As compared with the Joint Task, which was focussed on investment grants to companies and infrastructure, the ERDF was wider in scope and gave the Länder receiving assistance 45 the chance to formulate a reasonably comprehensive development strategy containing a wide-ranging package of measures. In most cases, there was a growing emphasis on clusters and growth poles, which was reflected in the concentration of support on specific sectors of activity or on major cities. Much of the funding went to strengthening SMEs and supporting RTDI, which led to: 45 In Germany, the Länder, which correspond with NUTS 1 rather than NUTS 2 regions, represent the regional level of government responsible jointly with the Federal authorities for formulating development strategies. 127
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