ESFVON
European Social Fund Voluntary Organisations Northern

OBJECTIVE 2 BULLETIN - SEPTEMBER 2003

OBJECTIVE 2 MID-TERM EVALUATION SPECIAL

OBJECTIVE 2 VOLUNTARY & COMMUNITY SECTOR CONFERENCE - THE FUTURE OF THE OBJECTIVE 2 PROGRAMME 2004-2006
KEY SPEAKER -
JOHN RUNDLE, DIRECTOR FOR EUROPE GOVERNMENT OFFICE FOR THE NORTH EAST
John Rundle, Director For Europe at Government Office for the North East will be the key speaker at the forthcoming conference on the Future Of The Objective 2 Programme 2004-2006. You may recall in July last year, John's predecessor, David Slater, was the main speaker at an Objective 2 Voluntary and Community Sector Conference held at The Glebe Centre, Murton, County Durham. This event was at a stage in the Programme whereby greater flexibility was required to enable greater amounts of resources to be released to organisations to deliver projects.

ESFVON are happy to invite you to the follow up event as John will be speaking to the voluntary and community sector on the future of the Objective 2 Programme in the North East for the 2004-2006 period. This will take place on the morning of Thursday 30th October 2003 at The Glebe Centre, Murton in County Durham. As you will read elsewhere in this Bulletin the Mid-Term Evaluation of the Objective 2 Programme has now produced its final recommendations. John will be talking through these changes and how this will affect potential applicants.

There will be some major changes to the Programme as can be seen below in each of the Programmes 4 Priorities. There will be a reduction in the number of Measures in Priority 4, the part of the Programme that most voluntary and community organisations are interested. This does not necessarily mean there will be fewer eligible activities, hopefully just a simplified and easier Programme in place. If you are interested in the field of community enterprises/businesses then there are significant changes you will need to be aware of. If nothing else, whether you are currently involved in the Objective 2 Programme, have been involved previously or never touched European funding you should come to this event. It may just be key to unlocking your organisation's funding requirements. You will also be given the opportunity to ask John questions regarding the Objective 2 Programme.

If you would like to attend there will be no charge and please return the attached booking form to ESFVON either via e-mail info@esfvon.org.uk or fax 0191 274 2235.

OBJECTIVE 2 MID-TERM EVALUATION REPORT

EKOS, the Objective 2 Mid-Term Evaluators of the Objective 2 Programme have finalised their report. This report was discussed and agreed by the Programme Monitoring Committee (PMC), the head Objective 2 committee in the North East.
Single Programming Document And Criteria
  1. Priority 1 should increase flexibility to enable support to be provided to SMEs older than 3 years. Up to 20% of the SMEs could be older than 3 years and will not require an additional application to Priority 2.
  2. Measure 1.3 for SME premises should be disbanded with the resources moving to Measure 2.6 to create one SME premises Measure regardless of the age of the SME.
  3. Priority 2 should provide support to all eligible SMEs.
  4. Priority 3 should be redesigned to increase flexibility of criteria.
  5. The level of population coverage in Priority 4 should be maintained.
  6. Priority 4 should be re-organised into 2 Measures, one for ERDF and one for ESF, with the community and social enterprise support provided through Priorities 1 and 2.
  7. Measure 3.2 (ESF) should be removed as no activity to date with resources re-allocated to Priority 4.
    8. Financial Allocations
  8. A minimum of 10% of Priority 2 resources, circa £25m, is transferred to Priority 3.
  9. Priority 1 capital allocation of £20m is transferred to Measure 2.6 to form a single capital Measure for SME development.
  10. Priority 3 ESF resources are transferred to Priority 4 ESF.
    11. Quantification And Targets
  11. GO-NE should convene a short life group to re-consider all of the indicators and targets.
  12. GO-NE should use recent experience of typical costs and involve ONE North East staff in the quantification and monitoring of Single Programme projects to ensure North East relevant costs are accurately identified and benchmarked.
    13. Management Arrangements
  13. A senior committee is established to identify and oversee Priority 3 Strategic Investments.
  14. Wherever possible Single Programme and other appraisal systems, suitably amended to take account of European funding requirements should be used, thus reducing the need for 2 applications and 2 appraisal systems.
  15. GO-NE should appoint senior managers to liase with the new delivery vehicles - Centres of Excellence, Area Brokerage Partnerships and Sub Regional Partnerships.
    16. Delivery Arrangements
       Business Brokerage Model

  16. The Business Brokerage Model should be used as the key delivery vehicle for Priority 2.
  17. Priority 1 should follow a similar approach to Priority 2, with sub-regional implementation plans.
  18. The new Priorities 1 and 2 arrangements should take account for the needs of small businesses in rural areas, including land based and micro-tourism businesses (e.g. higher average delivery costs for certain support).
    19. Single Programme Sub-Regional Action Plans
  19. Each Sub-Regional Partnership negotiates and annual ERDF and ESF allocation at the Single Programme Delivery Plan level from 2004/5 onwards.
  20. Sub-Regional Partnerships should be encouraged to make use of Single Programme capital monies for capital and revenue SME activities.
  21. Sub-Regional Partnerships proposals for ERDF and ESF resources should include the needs of rural areas with tailored support identified.
    22. Package Resources
  22. Current resources available for Priority 1-3 package co-ordination should be re-directed in the light of the recommendations in the report, with a re-focussing based on strengthening the capacity of the partnership to deliver increased activity.
  23. For Priority 4, GO-NE and package staff should develop much closer working relationships, with clear lines of management and accountability and increased central support to assist package co-ordinators provide a high quality service to local partners.

Conclusion

Below is the conclusion given by EKOS.

"The North East Objective 2 Programme has faced a number of major difficulties in the first years of the SPD. While it is not relevant to repeat the problems, the result is that there is still substantial work needed for the Programme to catch up. The recommendations outlined in this report should be regarded as a starting point. Although substantial new activities are proposed, with new and more effective delivery arrangements put forward, previous experience suggest that not everything will go according to plan and that other actions will be necessary.

The close monitoring of the financial commitments and expenditure and the further development of partnership arrangements, including a re-configured Priority 3 will be important in ensuring that the Programme meets its objectives. There remains a reasonable degree of risk, however, as the new arrangements essentially put the success of the Programme into a small number of key partners and partnership groups.

The Programme can build upon the considerable effort put in to addressing constraints by the European Programmes Secretariat and partners over many months. There remains a determination that the Programme will be successful and with goodwill on all sides a new period of more efficient and effective implementation can take place"

GLOSSARY

To assist those of you who may be unfamiliar with the 4 Priorities of the Objective 2 Programme and some of the terminology used below is a brief description.
Priority 1 - Establishing An Entrepreneurial Culture
This Priority is currently to support Small & Medium Sized Enterprises that have been trading for less than 3 years.
Priority 2 - Small & Medium Sized Enterprises Growth & Competitiveness
This Priority is currently to support Small & Medium Sized Enterprises that have been trading for more than 3 years.
Priority 3 - Strategic Employment Opportunities
This Priority is aimed at large industrial estates and other projects that have the potential to create large numbers of jobs.
Priority 4 - Target Communities: Building Capacity & Connecting With Jobs
This Priority is focussed on the most deprived areas in the North East to enable the local residents better access employment and training.

ESF - European Social Fund. ESF is one of the two funds that make up Objective 2. ESF provides financial support to address training and employment needs for both employed and unemployed people.

ERDF - European Regional Development Fund. ERDF is the other fund that makes up Objective 2. There are two types of ERDF project, capital and revenue. These projects proved assistance primarily for infrastructure projects and investments that create or maintain jobs. Typical activities include new facilities, improving/converting existing facilities, community appraisals and capacity building.

SME - Small & Medium Sized Enterprise. Basically an organisation that is trading. Although there are a number of criteria to qualify as an SME the easiest of them to compare against is the organisation employees less than 250 employees. The SME definition also includes community enterprises/businesses.

GO-NE - Government Office for the North East - Part of the Government Office in Newcastle is the European Programmes Secretariat. This department makes all final decisions on Objective 2 projects approval and is the administrative hub for the Programme as a whole.

SPD - Single Programming Document. The SPD sets out the North East's case for receiving Objective 2 funding. It contains various statistics which show the major needs of the region. These needs are the 4 Priorities of the Programme, which can be broken down into more, detailed Measures under each Priority. Any changes to the SPD will need agreement from the European Commission.

OBJECTIVE 2 PROGRAMME 2004 -2006 IMPLEMENTATION TIMETABLE

Having read the recommendations there remains the question of when will the changes take place and when can project sponsors start being approved in the second half. The current expectation is that starting in October, the North East will be negotiating the Mid-Term Evaluation recommendations with the European Commission. From this point on the North East and the Commission will be liasing closely to finalise the changes. It is expected that this process will be finished by the end of March 2004. Once these changes have been completely signed off by the Commission the North East will be in a position to start approving projects with the new arrangements. You will note that the first half of the Programme is supposed to be stopping approvals by GO-NE at the end of 2003. What will happen during the intervening period between the end of 2003 and the formal start of the second half of the Programme? As yet, this has not been formally decided upon. There is an expectation the current administrative arrangements and eligible actions will be used during the intervening period to allow projects to still be approved by GO-NE. Once the new administrative arrangements are completely agreed, with the current prediction being March 2004, they will be implemented and then Objective 2 applications would be approved using the new arrangements and new eligible actions.

Last Updated: 22nd October

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