Select Committee on European Scrutiny Twentieth Report


TRANS­EUROPEAN TRANSPORT NETWORK


(23038)
15111/01
COM (01) 545

Draft Regulation amending Council Regulation No. 2236/95/EC laying down general rules for the granting of Community financial aid in the field of the trans­European transport network.


Legal base:Article 156 EC; co-decision; QMV
Document originated:3 December 2001
Forwarded to the Council: 4 December 2001
Deposited in Parliament: 3 January 2002
Department:Transport, Local Government and the Regions
Basis of consideration: EM of 31 January 2002
Previous Committee Report: None
To be discussed in Council: March 2002
Committee's assessment:Politically important
Committee's decision:Cleared, but relevant to the debate already recommended on the European Transport White Paper and the trans­European transport network


Background

  16.1  On 30 January 2002 we recommended the Commission's second White Paper on transport ("Time to decide") and a proposal to revise the existing Community guidelines for the development of the trans­European transport networks (TENs) for debate in European Standing Committee A. The debate is to be held on 13 March, in time for the Transport Council of 25/26 March. At that Council a decision is also expected to be reached on a Commission proposal to amend the current rules for the granting of Community financial aid to TENs.

The document

  16.2  The Commission proposes an amendment to the existing financial regulation for TENs (No. 2236/95) to allow the Community to contribute up to 20% of project costs — as opposed to the 10% currently allowed — to support critical but difficult to finance cross-border projects and projects to clear bottlenecks on the borders with candidate countries.[40] In his Explanatory Memorandum of 31 January 2002, the Minister of State for Transport (Mr John Spellar) sets out the Commission's proposals:

    "The Commission now proposes that the maximum level of support of 20% of total investment costs should... be made available from 1 January 2003 to cross­border rail projects crossing natural barriers such as mountain ranges or stretches of water and to other projects aimed at eliminating bottlenecks at borders with countries seeking accession to the EU. The Commission suggests that a higher rate of support will have a leverage effect and attract private investors in particular.

    "The Commission also proposes that the committee procedure set out in Article 17 of the existing Regulation should be modified to comply with the 1999 Council Decision on Comitology.[41]

    "Finally, the Commission proposes that the TENs financial framework for the period 2000 to 2006 as set out in Article 18 of the existing Regulation should be increased by £100 million to £4,700 million. The Commission suggests that the additional £100 million could be allocated to Member States to use towards the most urgently needed improvements related to cross-border transport infrastructure with candidate countries."

The Government's view

  16.3  In his Explanatory Memorandum, the Minister tells us:

    "This is not the first time that the Commission has proposed that the maximum level of EU support to TENs projects should be more than 10% of total investment costs. When the Council adopted the Financial Regulation in 1995, it rejected a proposal from the Commission that the maximum support should be set at 30%. And, while the Council and European Parliament accepted 20% support for satellite positioning and navigation systems when they adopted the amending Regulation in 1999, they rejected the Commission proposal that 20% should also be made available to transport projects relating to more than one Member State or projects contributing strongly to the broader trans­European interest including those having an important environmental dimension.

    "The Government believes that the bulk of TENs financing should continue to come from the public and private sectors in individual Member States and, at Community level, from the European Investment Bank and, where appropriate, the Cohesion Funds. The role of the TENs budget should be to act as a catalyst to get projects off the ground. The current EU financial provision for TENs is not sufficient to provide support of even 10% of total investment costs to major transport projects. And the Government believes that allowing the Community to meet up to 20% of projects' costs could put strong upward pressure on the TENs budget line.

    "The Government supports the proposed changes to the committee procedure set out in Article 17 of the existing Regulation to bring it in line with the 1999 Comitology Decision. And it is content to see the financial framework set out in Article 18 of the existing Regulation increased to £4,700 million, subject to sufficient margin being available for future years under the 2000­2006 Financial Perspective."

Conclusion

  16.4  The Community funding for TENs is designed to act as a catalyst for extra investment in important trans-European routes. However, as the Government observes, the funding available in the existing TENs budget line is not enough to meet the calls on that funding, even with the current maximum of 10% of the projects' costs. The Commission's proposal to increase the maximum to 20% will inevitably lead to increased tension in allocating the funds amongst competing projects. If the Commission's proposal is agreed, we urge the Minister to monitor closely whether there are any adverse effects on the TENs funding for UK projects.

  16.5  We clear the document, but it is relevant to the forthcoming debate on the European Transport White Paper and the draft Decision on Community guidelines for the development of the trans­European transport network.[42]



40   The maximum level of support (from 1 January 2003) was increased under Regulation No. 1655/1999 from 10% to 20% of total investment costs for projects concerning satellite positioning and navigation systems. For all other projects, the maximum remains 10% of total project costs.  Back

41  Decision I 999/468/EC of 28 June 1999. Back

42  (22660) 11932/01, (22776) 12597/01: HC 152-xv (2001-02), paragraph 2 (30 January 2002). Back


 
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