Scotland Rural Development Programme 2014-2020 - Consultation on Stage 1 Proposals : An Analysis of Responses

3 Wider Context - EU Fund Structure

3.1 This chapter presents findings from an analysis of the responses made in relation the Scottish Government's proposals: (i) to marshal EU funds into three Scottish funds that reflect both Scottish Government and EU priorities and (ii) to establish a single Programme Monitoring Committee to monitor the spend of EU funds in Scotland.

Three Scottish funds (Q1)

3.2 The consultation paper set out proposals for marshalling Scotland's EU funding into three funds covering:

• Competitiveness, innovation and jobs
• Low carbon, resource efficiency and environment
• Local development and social inclusion

3.3 Respondents' views were sought on this approach:

Question 1: Given the EU's Common Strategic Framework approach do you agree or disagree that EU funds in Scotland should be marshalled into three funds? Please explain your views.

3.4 In total, 101 respondents answered this question (11 individuals and 90 organisations). Of these 88% agreed with the proposal to marshall EU funds in Scotland into three funds and 8% disagreed. See Table 3.1.

Table 3.1: Summary of responses by respondent type (Q1)

Type of respondent	Individuals	Organisations	Total respondents	%
Agree	8	81	89	88%
Disagree	2	6	8	8%
Other	1	3	4	4%
Total	11	90	101	100%

Views in support of the three fund approach

3.5 Those who agreed with the proposal offered a range of interlinked views. They thought that the three fund approach would:

• Aid clarity and simplicity, while also maximising the scope for coordination, integration and improved targeting
• Support transformational change and achieve greater impact
• Offer advantages in relation to administration and governance and be more transparent and open to scrutiny.

3.6 There was also support for the specific themes proposed. These were described as being "sufficiently broad in scope to meet current economic challenges and provide a flexible framework …to adapt to future change". Respondents commonly regarded these themes as appropriately aligned with EU priorities and the Scottish Government Economic Strategy.

Caveats and disagreement with the three fund approach

3.7 The following views were put forward by those offering qualified agreement or disagreement with the three fund approach:

• Adopting a joined-up approach: Respondents referred to other relevant Scottish Government policies and strategies, including the Land Use Strategy and Scottish Biodiversity Strategy, and the importance of adhering to the principle of minimising environmental harm in operating the three funds. Respondents stressed the need for the funds to adopt a joined-up approach which recognised the positive impact that environmental projects could have on communities and local economies. There was concern that the approach should incorporate procedures for cross-fund projects which could deliver multiple benefits.
• Coverage and emphasis of the three funds: Respondents highlighted a number of issues which they thought needed to be given prominence across the three broad themes: biodiversity; environmental and landscape level benefits; the rural economy and rural communities; social and economic development; climate change; food security; and the historic environment. In relation to the 'low carbon, resource efficiency and environment' theme in particular, there were suggestions to place this theme first; to reorder the phrasing to put 'environment' first; and to include a reference to 'biodiversity'. The absence of a specific mention of 'climate change' was a particular concern. A fourth theme of 'financial instruments' was also suggested.
• Equitable treatment of rural and urban areas: Issues raised here included ensuring that rural areas could access ERDF (European Regional Development Fund) and ESF (European Structural Fund) support; the potential of rural projects having to compete against (often larger scale) urban projects; the importance of ensuring that small businesses (which tended to dominate in rural areas) were not disadvantaged; the concern that 'rural' should not come to be interpreted as 'land-based'; concerns that sustainability, farming and agricultural interests should not be disadvantaged.
• Management and governance: Concerns were raised in relation to the challenge of managing funds over such a wide remit; the different eligibility and audit requirements for different EU funds and the need for clear procedures to ensure these were met; how different stakeholder organisations would interact across the funds; and what delivery structures would be adopted. Respondents asked for clarity about what would be delivered at national, regional and local levels, and there was a suggestion that arrangements should allow for regional variation.
• Accessibility for fund-users: There was concern that the approach would require complicated rules and structures. Respondents highlighted the need for: clear procedures and guidance for each fund; clarity about the activities supported by each fund and the linkages between the funds; and adequate publicity.

3.8 At a more principled level, respondents questioned the need for and / or benefits of a three fund approach, particularly given the virtual nature of the funds. Alternative suggestions included the establishment of a single fund better able to take an integrated strategic approach, and a fund structure based on geographic (national, regional, local) lines.

Other issues

3.9 There was criticism of the perceived lack of detail and further information was sought on: how the funds would be structured and managed and how they would operate; the delivery mechanism for the three funds; and the linkages and relationships between the funds.

A single Programme Monitoring Committee (PMC) (Q2)

3.10 As well as outlining the proposed three Scottish funds, the consultation paper set out plans for a single Programme Monitoring Committee (PMC). The PMC would be supported by advisory groups and sub-committees as required and would involve stakeholders with interests across the three funds. Views were invited on the establishment of such a committee:

Question 2: Do you agree or disagree with the proposed establishment of a single Programme Monitoring Committee to ensure all EU funds are targeted effectively? Please explain your views.

3.11 In total, 101 respondents answered this question (13 individuals and 88 organisations). Of these, 79% agreed with the proposal to establish a single PMC and 10% disagreed. See Table 3.2.

Table 3.2: Summary of responses by respondent type (Q2)

Type of respondent	Individuals	Organisations	Total respondents	%
Agree	11	69	80	79%
Disagree	-	10	10	10%
Other	2	9	11	11%
Total	13	88	101	100%

Views in support of the establishment of a single PMC

3.12 Those who agreed with the proposal believed that this approach would:

• Support integration and joined-up working
• Minimise bureaucracy and duplication of effort
• Improve monitoring and consistent scrutiny across the funds.

3.13 Respondents generally wished to see the PMC taking a high-level role in providing strategic direction (including in relation to ensuring alignment with other Scottish Government priorities) and overseeing performance.

Caveats and disagreement with the establishment of a single PMC

3.14 The following views were put forward by those offering qualified agreement or disagreement with the three fund approach:

• Supporting structures: There was concern about whether and how a single PMC could operate effectively. Respondents commonly argued that it could only do so if it was sufficiently staffed and resourced and supported by sub-committees and working groups. There were calls for a separate sub-committee for each fund and for regional PMCs. Generally, respondents favoured devolved decision-making.
• Representation: This was a key issue for respondents who argued for representation that reflected a full range of issues and sectors (e.g. wider rural as well as land-based interests; the highland and island perspective; environment and sustainability; community and third sector interests); and included a range of organisations (e.g. local authorities and community planning partnerships; business development agencies; LEADER LAGs), with a number of respondents putting forward their own case for inclusion. While there was consensus about the need for wide-ranging representation, there were also concerns about the potential for conflicts of interest and lobbying. Concern about representation was a key issue for those opposed to a PMC.
• Openness and transparency: There were calls for the PMC to be open and transparent in its operation, to establish clear channels of communication with those not directly involved as representatives and to routinely publish papers and minutes.
• Access to expertise: The need for the PMC to have a good understanding of a wide range of issues within its remit was noted, along with the need to have access to expert advice. Sub-committees were seen as one way of providing the level of expertise required. However, others saw the issue of expertise as a fundamental reason for opposing a single PMC.
• Clarity: Respondents stressed the need for clarity on how the PMC would operate, and the rules and requirements governing different aspects of the operation of the PMC and the three funds. The need for clear alignment with EU rules was noted.
• Remit: Some wished to see the role of the PMC limited to that of overarching or essential monitoring and reporting, while for others, the necessarily wide-ranging role of the PMC was seen as just too challenging for this to be a practical option.

3.15 Those opposed to the establishment of a single PMC favoured a less layered structure and argued for separate management arrangements for each fund.

Other issues

3.16 Respondents sought further clarity on how the PMC would operate, and the relationship between the PMC and its delivery partners and agents.