'The Regions in the 1990s' - fourth periodic report on the social

and economic situation and development of the regions of the

Community

The European Parliament,

- having regard to Article 8 of Regulation (EEC) No. 4254/88

of 19 December 1988 on the reform of the ERDF,

- having regard to the fourth periodic report on the social

and economic situation and development of the regions of

the Community (COM(90) 0609 - C3-0053/91),

- having regard to the report of the Committee on Regional

Policy, Regional Planning and Relations with Regional and

Local Authorities and the opinions of the Committee on

Economic and Monetary Affairs and Industrial Policy and the

Committee on Social Affairs, Employment and the Working

Environment (A3-0065/92),

1. Notes that the level of analysis and the breadth of

coverage of the fourth periodic report show a

considerable improvement on previous reports;

2. Notes that the main findings of the report are as

follows:

(a) regional disparities in the Community at the end of

the 1980s remain as wide as ever despite the strong

growth in the economy as a whole: per capita GDP in

the ten most developed regions is on average three

times higher than in the ten least developed

regions, almost all of them in Portugal and Greece;

(b) Greece did not, during the period under

consideration, share the positive growth in

productivity, which led to a stabilization in

disparities in income per head in Spain, Portugal

and Ireland: it now has the lowest GDP per head and

lowest GDP per person employed of the Community,

(c) there are also marked imbalances in unemployment

levels: in some 20 of the 171 regions of the

Community surveyed, principally in Spain, Italy and

Ireland, unemployment is running at over 15%;

(d) the regional disparity in general and vocational

training, which is a determining factor in regional

competitiveness, is disproportionately large: in

Portugal and Greece fewer than 10% of all young

people receive vocational training;

(e) in order to improve the effectiveness with which

resources are used for regional development, a shift

of emphasis is required from infrastructure aids to

investment aid at business level;

(f) in the least developed regions or Member States the

ERDF finances between 5% and 7% of all investments;

(g) it will take many years (20 or more) and above-

average rates of growth in the least developed

regions to overcome regional disparities: this

requires long-term planning;

(h) growth in the size of the potential workforce

(births outnumbering deaths, migration) to the year

2000 will make combating unemployment considerably

more difficult, particularly in Objective 1 regions;

3. Regrets that the Commission has not followed up the

requests put forward in its resolution of 8 July 1988 on

the third periodic report to provide detailed

statistical evidence, compiled at NUTS III level, on

matters such as the situation of the labour market in

the regions, their standard of training, the structure

and composition of regional assistance and the strengths

and weaknesses of the regions, so as to provide a

profile of these;

4. Deplores the fact that the Commission has not, on its

own initiative, assessed the effects on the regions of

the Community's policies on the environment and

environmental protection;

5. Regrets further that practically no analyses have been

made of the situation of women, a policy area which

constitutes a major challenge in less-favoured regions;

6. Welcomes, given the fourth periodic report's profoundly

depressing conclusions with regard to convergence, the

decision of the Maastricht Summit to strengthen economic

and social cohesion in the Treaties and to set up a

Cohesion Fund; believes, however, that it is absolutely

essential that in the reform of the Structural Funds and

the arrangements for financing the convergence fund,

these newly agreed undertakings be given concrete and

financially effective form;

7. Proposes that a revision of the Structural Funds

regulations contain legal provisions for sanctions,

should control measures reveal misuse of public funds

and failure to observe the basic principles of the

regulations, e.g. the principle of additionality;

8. Emphasizes that political responsibility for the

economic and social cohesion of the Community lies with

the regions, the governments of the Member States and

the EC: notes that almost all Member States have cut

back their regional development expenditure since 1983,

and that this reduction in real terms in national

regional development budgets has not been offset by a

doubling of the Community's Structural Fund resources;

9. Does not share the Commission's optimistic forecast of

the future effects of the single market and economic and

monetary union on the less-developed regions of the EC

and border regions dependent on customs-related

activity, and calls on the Commission to draw up a

detailed impact assessment incorporating the preliminary

work done by the European Parliament and the opinions

expressed at the second conference of the European

Parliament and the regions of the Community;

10. Agrees with the Commission that the restructuring

required in the five new Federal German Länder poses a

significant challenge, but takes the view that the

analyses of the economic and social development of these

regions are over-optimistic in the light of evidence of

a lower rate of development in the interim;

11. Calls on the Commission, in view of the fact that the

rate of development is markedly lower than forecast in

the five new German Länder, to review its current

subsidies policy and take it into account when

reformulating structural policy after 1993;

12. Recalls that economic and social cohesion cannot be

achieved exclusively through the Structural Funds but

must also, above all, be an objective of all other

Community policies, in fields such as R&D, energy,

transport, telecommunications and agriculture which can

contribute significantly;

13. Expresses its conviction that in ultra-peripheral island

regions, economic and social cohesion will be possible

only if, in conjunction with the implementation of the

Community policies referred to above, a specific fiscal

policy is also simultaneously applied for a reasonable

period of time: only in this way can the flow of

financial resources generated in these regions to other

parts of the Community be prevented, so that they remain

concentrated in the regions and can provide the

necessary resources and financial wherewithal for

regional development and economic growth, as has already

been demonstrated in other, non-Community ultra-

peripheral island regions;

14. Notes that the Structural Funds, particularly following

their re-orientation, are making a significant

contribution to overcoming the imbalances but, in the

light of the findings of the fourth periodic report,

considers a re-orientation of structural policies to be

essential in the following areas:

(a) further concentration of the funds' resources in

both geographical and financial terms on the least

developed regions of the Community, with particular

reference to promotion of 'soft' location factors;

(b) a review of the selection criteria for special

development regions; in addition to unemployment

and GDP, the scale of school and vocational training

facilities, particularly for the 15-19 age group,

and the standard of infrastructure development

should be taken into account as further criteria for

designation of such regions;

(c) increased transfer of subsidies from infrastructure

into private economic development in both the

secondary and the services sectors, thus increasing

the future importance of the latter as a source of

new jobs and as a major 'soft' location factor;

(d) as the deficit in school and vocational training

facilities for young people is perpetuated in the

form of employment and prosperity deficits, the

Structural Funds must become more active in the

field of both education and vocational training and

further education, including the provision of

educational and further education infrastructures;

(e) in view of the ever more complex pattern of

interconnected regional, national and Community

support measures, the need for information and

consultation in the special regions is becoming ever

greater. The Structural Funds must develop an

active information policy;

(f) the structural effects of disarmament;

(g) measures to evaluate the success of regional

development measures must be strengthened;

(h) a certain percentage of the Community budget should

be held in reserve so as to provide flexible aid in

unforeseen cases of hardship or crisis, for example,

in connection with the regional effects of

environmental or similar disasters;

(i) the social partners should be involved earlier and

in a more thorough-going manner at institutional

level;

15. Calls for stricter monitoring of state aids outside the

special regions, in order to give investment promotion

in structurally weak development areas greater impact;

16. Calls for any additional financial resources made

available within the EEA by the EFTA countries for

structural aid of the less developed regions of the

Community to be channelled towards the Community's

Structural Funds;

17. Calls on the Commission to investigate the following

additional aspects in its fifth periodic report:

(a) the importance of decentralization and

regionalization, taking due account of the

subsidiarity principle as a factor in regional

development;

(b) the impact of Member State subsidy policies

(including indirect subsidies, sectoral promotion

measures, tax concessions, etc.) on the less

developed regions of the Community;

(c) more detailed analysis to assess the competitiveness

of regions;

(d) more detailed analysis of the increased

infrastructure and social costs incurred by regions

with very low population densities;

(e) possible ways of increasing the efficiency of

regional and local authorities in the less developed

Community regions;

(f) the scale and significance of the underground

economy in the Member States;

(g) the socio-economic impact, and the effects on the

labour market, of the abolition of internal

Community frontiers, compiled at NUTS III level;

(h) integration of new social and environmental

indicators taking account of the quality of life and

the specific characteristics of regions into the

financing criteria for the Structural Funds,

18. Instructs its President to forward this resolution to

the national parliaments of the Member States and the

assemblies of the regions of the Community, the Council,

the Commission and the governments of the Member States.