Speech Kroes over het actieplan voor staatssteun (en)

Neelie Kroes

Member of the European Commission in charge of Competition Policy




The State Aid Action Plan

Introductory remarks at open meeting of coordinators of the Economic and Monetary Affairs Committee, European Parliament
Strasbourg, 7^th June 2005

Madame le Président, Honourable Members,

Thank you for arranging our informal meeting today. I am delighted to be here to present the State Aid Action Plan which the College adopted at the meeting I have just left.

Over the last five years, anti-trust and merger rules have been comprehensively - and, in my view, successfully - reformed. It is now time for a long, good look at the rules for State aid. This Commission believes that a clear, predictable and coherent framework for State subsidies can make a significant contribution to a sustainable environment for economic growth and more and better jobs in Europe.

We approach this issue on the basis of two parallel principles: efficiency and equity.

Efficiency because we should never forget that state subsidies are paid for by European taxpayers. State resources are limited, and they are needed for many core tasks, like education, health or social protection. Our Member States therefore need to be able to make their spending choices transparently and to spend money efficiently.

We want to this reform to help Member States get the best value for money for their taxpayers. That means designing a framework to target aid better. When state subsidies are used intelligently to fill clearly identified gaps, they can deliver sizeable spin-offs - for citizens, for consumers, for companies, for Europe's overall competitiveness and economic growth.

And of course, the efficiency principle must also mean making sure that State aid procedures are as simple, user-friendly and clear as possible, for stakeholders at all levels.

The other guiding principle behind our reform ideas is equity. This policy aim is just as important as the efficiency objective. Equity applies at many levels in our reform proposals.

State aid control is essential to maintaining a level playing field in the Single Market. It is one of the tools which keep markets fair and free, which means businesses compete on the merits of their goods and services, striving to win over consumers with higher quality and lower prices.

But there is a much wider equity agenda which clearly pervades our approach. This reform has to be shaped to deliver on a wide range of primarily non-economic issues which are of fundamental importance to our European model. This includes social and regional cohesion, human capital and cultural diversity.

I would like to stress five features of the State aid Action Plan:

1. Firstly, the Action Plan presents the general philosophy with which the Commission approaches State aid reform. You will not be surprised that our leitmotif is the European Council's call for "less and better targeted state aid".
2. Secondly, more emphasis is given to the priorities of the re-launched Lisbon Strategy for growth and jobs, through having recourse to a refined economic analysis. In the economic sphere, this economics-based approach is about better finding out why certain desirable economic objectives (such as growth and sustainable jobs) are not met naturally by markets - and what can be best done against that (which does not necessarily always mean State aid). But we fully recognise the importance of other State aid objectives in the common interest. The aim is a coherent and holistic framework for national support to research, innovation, entrepreneurship, human capital, high quality services of general economic interest, environmental protection, and of course, regional cohesion. Regional aid is recognised as the instrument to redress imbalances in regional development and contribute to cohesion - irrespective of the correction of market failures. This is also why we propose that investment aid to large companies remains possible in assisted regions. Horizontal instruments such as R&D, or in the future, for certain innovative activities, or for risk capital or assistance to SMEs - can and should be available everywhere across the EU, including assisted regions. This gives assisted areas the advantage they need to catch up whilst ensuring that non-assisted areas continue to have access to horizontal aids.
3. Third, the Action plan makes proposals to improve the efficiency of state aid procedures, to speed up decision-making and to make the partnership with Member States work better. Better State aid also means better regulated State aid, simplifying the rules and reducing the administrative burden on all actors.
4. Fourth, it provides a global picture of the reform proposed. Even a simplified State aid regime will have to be made up of several components. The Action Plan is a roadmap, showing how the future measures together contribute to achieve the overall goal: meet the basic twin objectives of state aid policy - efficiency, and equity. Because of this, the Action Plan should help dispel some misunderstandings which have appeared in some parts of the press.
5. Finally, and most importantly, the Commission does not claim to have all the answers. So a public consultation process has been launched with today's Action Plan. Our debate this afternoon is the first of many opportunities to hear and discuss the views of stakeholders from all backgrounds and from all over Europe. The concrete regulatory proposals will be finalised at a later stage, once all those interested will have had the opportunity to express their views. And I look forward to regular exchanges with this Committee throughout the reform process, starting with our rendez-vous in Brussels later this