To release fully the potential of PPPs as a tool for facilitating economic recovery and building sustainability, competitiveness and high quality public services for the future as well as maintaining high level of environmental standards, the Commission intends to build an effective and enabling co-operation framework between public and private sector. Drawing on a dialogue with all relevant stakeholders through a dedicated PPP group to be set up by the Commission, a series of actions will complement Member States' actions to remedy the obstacles to the development of PPPs and to promote their use. These proposed actions will focus, on the one hand, on the Community instruments and regulatory framework, and on the other hand, on enhanced measures aimed at improving the access to financing of PPP initiatives and increasing the EIB's role in financing essential projects. The ultimate decision to use PPPs lies with the Member States' public authority and it is for the Member States to review the national framework as necessary to enable it. The Commission will:
1. Improve access to finance for PPPs through:
● Reinforcing and broadening the scope of the Community instruments currently available to support PPPs, such as LGTT and EPEC and other initiatives that, although not specifically aimed at PPP schemes, can support the implementation of PPP projects (JASPERS, JESSICA, RSFF, Marguerite Fund).
● Coordinating closely with the EIB in order to explore possible ways to increase the Bank's participation in EU infrastructure financing, in particular regarding key initiatives in the EU with socio-economic and European added value (e.g. cross-border projects, environmentally friendly initiatives, etc.). The EIB should also be supported in its efforts to make full use of the multiple instruments available for PPPs and to integrate PPPs as one of the core objectives of the Bank. Furthermore, the EIB is invited to further develop and implement guarantee instruments to facilitate the financing of PPPs, by promoting the role of the capital markets, institutional investors and the public sector as liquidity providers for PPP schemes.
2. Facilitate the setting up of PPPs through public procurement of PPPs by :
● Examining the impact of the Community crisis response on the availability of finance for infrastructure investment, including the need for an adjustment of procurement programmes and processes to take account of reduced access to finance.
● Completing ongoing impact assessment and other preparatory work with a view to considering a legal proposal in the area of concessions in 2010.
3. Ensure proper debt and deficit treatment of PPPs through:
● Examining the implication on the 'balance sheet' treatment of PPP assets of revised financing arrangements and issue clarifications on the existing accounting treatment in national accounts of PPP contracts.
● Providing guidance on the accounting treatment of guarantees provided in the context of PPP schemes.
● Continuing to provide clear advice to Member States on the statistical recording of individual PPP contracts, should they request it.
4. Improve information and disseminate relevant expertise and know-how, by:
● The Commission will issue guidance on the legal and methodological issues involved in combining EU funds with PPPs, in particular in the framework of the JASPERS initiative, in order to facilitate and increase the uptake of PPPs in structural funds. Guidelines on the applicability of PPPs for simpler forms of PPP such as Design-Build-Operate contracts will also be issued.
● Pilot PPP projects that could serve as models of best practices, good governance and solutions should be developed and replicated on a wider scale with the use of technical assistance elements of relevant funding programmes.
● Working with the European PPP Expertise Centre (EPEC) to identify means to deliver enhanced long term support to those Member States that seek to use PPP to optimise their use of structural and cohesion funds as a component of programmes of investment. EPEC should be strengthened and be developed into a platform for the exchange of information and best practices and act as a focal point for a European network of national bodies established to support PPPs. It can also complement the role of JASPERS and the Commission, both of which support individual grant applications and projects. Options to promote better project preparation and design projects that are better suited for private sector involvement will be explored.
● Disseminating good practice, in cooperation with EPEC, in order to enhance public sector management capability and reduce PPP costs. For example, EPEC has developed an analysis of potential remedial actions to support PPP initiatives in the prevailing circumstances of the financial markets34.
● Working with Member States to identify provisions in national legislation that prevent or hinder setting up PPPs, as part of the implementation of the European Economic Recovery Plan. Where the EU funding is involved, it should be ensured that there is no discrimination in the allocation of funds to investments projects depending on the management of the project, be it private or public. The Commission will examine together with Member States the EU and national rules and practices and present its findings, accompanied by proposals for modifications, where appropriate, by the end of 2010.
5. Address the specific challenges of JTIs and financing for innovation by:
● Moving the current JTIs rapidly to autonomy and examining the lessons learnt, while at the same time exploring options for streamlining the legal and administrative framework applicable to JTIs. While ensuring the protection of the EU's financial interests, the objective should be to strike the right balance between control and risk and be flexible enough to permit an efficient partnership with the private players, ensuring the protection of the EU's financial interests based on an equitable sharing in the costs and benefits
● Taking a strategic perspective with JTI leaders and other stakeholders to identify what the specific obstacles are and how they can best be addressed, including changes in the Community rules that govern them, such as the Financial Regulation, as necessary. A report including policy recommendations will be presented in the coming months. On the basis of the recommendations of this report, the Commission will propose a new framework for JTI, which could be based on private law bodies. This new framework will be taken into account in the revision of the Financial Regulation, which will be presented during the first half of 2010.
● Working with the EIB group and other stakeholders to see how the financial instruments could be strengthened in order to improve finance for innovation. This work should also examine whether and how the participation by the EU in private law bodies could be facilitated as a means to delivering our innovation policy goals. The output of this work could be included in Commission proposals for a new innovation policy, due to be presented in early 2010, and taken into account where appropriate, in the coming revision of the Financial Regulation.
The Commission will take stock of the results of these initiatives aiming at improving the EU framework for PPPs before the end of 2011 and if necessary, propose new initiatives.
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34 C.f. European Expertise Centre- EPEC-publication "The financial Crisis and the PPP market, potential remedial actions" of August 2009 at www.eib.org/epec.