Synthesis Report - European Commission - Europa

More documents

Recommendations

Info

Synthesis Report Ex-post Evaluation of the ERDF 2000-2006 • Given the commercial nature of the market in which ports compete and the profits which investment in them can often realise, is there any case for the ERDF being used to support their expansion or upgrading in future years? In contrast to the questionmark over the use of the ERDF for these purposes, there is a strong case in terms of both economic and social gains as well as environmental considerations for greatly expanding the support given to investment in urban transport systems. The same applies to intermodal links, especially if they are designed to take traffic off roads. 3.5 UNIT COSTS OF MAJOR PROJECTS An issue examined in the evaluation, which is relevant for assessing the support provided to transport, was the unit costs of major construction projects co-financed by the ERDF. The aim was to compare these across different parts of the EU for similar types of project to gain not only an indication of the way that they varied but also an insight into the value for money they represented. The investigation, which covered the construction of roads, railways, urban transport systems, infrastructure for water supply and treatment and energy supply, revealed, first, that major projects were prone to have a high incidence of delays in completion and of cost overruns. Some three-quarters of projects were subject to some delay, with the average time amounting to around 26% of the initially estimated period of completion. Just over half of the projects investigated exceeded their budget, with an average cost overrun of 21%. These figures, however, are not unusual and are very much in line with the incidence and scale of delays and cost overruns of major projects funded from national sources across the EU or in other parts of the world. For the most part, they do not vary systematically between countries or different types of project. For the projects examined, however, some differences were evident: • costs overruns were less of a problem in Germany then elsewhere and more of one in Poland (averaging 50% for the four projects investigated); • delays were particularly lengthy in Portugal (averaging 85% of the initial estimates for the 5 projects covered); • urban transport projects tended to be subject to larger cost overruns and delays than other types, average 45-50% in each case. It is difficult to draw conclusions about efficiency from this evidence, since there are a wide range of potential reasons for both cost and time overruns, many of which are outside the control of contractors or contracting authorities. However, they clearly indicate the importance of building in sufficient allowance for contingencies and delays in the planning and budgeting of projects. This tended not to be done adequately for most of the projects investigated. Indeed, in most cases, there was a bias towards optimism which is typical for large-scale infrastructure projects. The second point highlighted by the evaluation was that it is difficult to compare the unit costs of infrastructure projects across regions without a detailed breakdown of various features of the project and explicit consideration of the factors which affect costs. These include the terrain and other conditions which the project has to contend with, which can vary markedly and which can have a major effect on the cost of construction of roads or railways, Equally costs can vary significantly if projects differ in their features (a three-way motorway as opposed to a two-lane one, for example). A meaningful comparison of unit costs unavoidably entails having detailed data on the cost of the various elements involved in the construction process (in the case of 88
Ex-post Evaluation of the ERDF 2000-2006 Synthesis Report motorways, not only bridges and tunnels as opposed to the carriageway itself but also different types of bridge and tunnel). Such data, however, were not generally available from the authorities responsible for carrying out the projects in question, and the aggregate data which did exist did not enable meaningful comparisons of unit costs to be made 31 . The third point to arise from the evaluation, therefore, is that there is a need for data on the unit costs of major projects to be available not only for making comparisons across the EU but also to provide a basis for judging value for money. In this regard, those responsible for the evaluation developed a prototype database with the information collected during the exercise and an indication of the other series which should be compiled once the data become available. This database could not only serve as a basis for future evaluations but could also provide a set of benchmarks against which to assess the unit costs of constructing projects that are carried out or planned. As such, it could facilitate statistical analysis and make it possible to apply ‘reference class forecasting’ methods to assess planned projects (i.e. by providing the cost information required to compare these with completed projects with similar features). It, therefore, represents a potentially valuable output of the present evaluation and one which could potentially be put in place before the present programming period comes to an end. A final point to emerge forcibly is the impossibility of comparing the unit costs of enterprise support projects in any meaningful way. This is not only because the projects concerned vary markedly in nature – a venture capital fund as against a non-repayable grant to a firm to encourage innovation or the adoption of environmentally-friendly methods of production. It is also more fundamentally because it is not possible to define a unit in many cases, still less a common unit the cost of which can be measured. While the number of jobs created or maintained has been used in the past for this purpose, estimates of this typically do not distinguish net job creation, or net jobs saved, which are the relevant concepts, from the gross figures. They, therefore, tend not to give meaningful indications of the overall effect on employment in the region concerned. More importantly, the purpose of many projects – encouraging innovation, for example – is not to create or maintain jobs, at least directly, but to strengthen competitiveness or export performance. Although employment might be increased in the long-term in the region concerned, the direct short-term effect on jobs in the firms supported is not a relevant indicator of the success or failure of such projects. 3.6 SUPPORT FOR THE ENVIRONMENT 3.6.1 What were the objectives of policy? The increasing concern with environmental issues at EU level led to the Cohesion Fund, set up at the end of 1993, being specifically directed to financing the construction of environmental infrastructure, one of only two areas of investment in which the Fund could be used, the other being transport. It also led to the need to take account of the environmental implications of the projects supported by the Structural Funds being included as a horizontal requirement in the 2000-2006 programming period. In addition, the finance provided by the ERDF for this period 31 It should be noted that the collection and provision of unit cost data was not a requirement for managing authorities for the 2000-2006 programming period. 89
Page 1:
Cohesion Policy Ex-Post Evaluation
Page 4 and 5:
Synthesis Report Ex-post Evaluation
Page 6 and 7:
Page 8 and 9:
Page 10 and 11:
Page 12 and 13:
Page 14 and 15:
Page 16 and 17:
Page 18 and 19:
Page 20 and 21:
Page 22 and 23:
Page 24 and 25:
Page 26 and 27:
Page 28 and 29:
Page 30 and 31:
Page 32 and 33:
Page 34 and 35:
Page 36 and 37:
Page 38 and 39:
Page 40 and 41: Synthesis Report Ex-post Evaluation
Page 140 and 141:
Page 142 and 143:
Page 144 and 145:
Page 146 and 147:
Page 148 and 149:
Page 150 and 151:
Page 152 and 153:
Page 154 and 155:
Page 156 and 157:
Page 158 and 159:
Page 160 and 161:
Page 162 and 163:
Page 164 and 165:
Page 166 and 167:
Page 168 and 169:
Page 170 and 171:
Page 172 and 173:
Page 174 and 175:
Page 176:
Consult this website for further in
show all

Synthesis Report - European Commission - Europa

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?