EU Member States will improve the monitoring of financial instruments related to EU cohesion policy

The European Commission welcomed the approval by the Council the monitoring and reporting on financial instruments available under cohesion policy. Thanks to this new rule, the Commission will be able to produce accurate and comprehensive accounts, which give a true image of the Union's assets and of the actual budgetary implementation.

Member States will have to report once a year on progress made in financing and implementing financial instruments related to EU cohesion. The Commission welcomed therefore the approval by the Council of this new rule which will allow this institution to better assess the overall performance of financial instruments across Member States. In 2009, it already called for a revision of methodology for verifying additionality of cohesion policy.

According to the Commission, in times of scarce public finances the use of guarantee schemes or repayable assistance is the best way to maximise the impact of EU investment on the ground, ensuring in the long term many more projects can be supported. The so-called "repayable assistance" can take the form of either reimbursable grants (partially or totally repayable without interest by project holders) or credit lines offered to beneficiaries through financial institutions, acting as intermediaries. As an example, the National Institute for the support of Small- and Medium-Sized Enterprises (SMEs) can provide a reimbursable grant to a beneficiary with a view to a part of this grant being repaid once the project is complete. The investment returned to the national authority is reused for new projects.

On the other hand, the Member States have agreed as well with the possibility to increase the co-financing rate for all structural funds for so called programme countries, which receive special assistance, with a maximum of 10 percentage points. The European Parliament has approved this increase already. This new possibility will enter into force, together with the improved monitoring on financial instruments, by the end of this year.