Overview of EU Funds

European Structural Funds

The European Union provides financial support to promote economic development and social inclusion through a series of inter-related funds known as Structural Funds.

Structural Funds aim to promote the development and structural adjustment of a region that has fallen behind other parts of the European Community.

The Structural Funds are divided into three separate funds:

• European Regional Development Fund (ERDF)
• European Social Fund (ESF)
• Cohesion Fund

The funds are used to meet the three objectives of Cohesion and Regional policy, of which the Structural Funds are an instrument. In the 2007-2013 programme there are three objectives:

1. Convergence objective: (replacing the 2000-2006 programme Objective 1i). This supports the economic growth of poorer regions. This objective is funded by ERDF, ESF and Cohesion Fund.

2. Regional competitiveness and employment objective: (replacing the 2000-2006 programme Objectives 2 and 3). Aims to move regions out of crisis and into growth and jobs. This objective is funded by ERDF and ESF.

3. European Territorial Co-operation objective: (replacing the current Interreg Community Initiative). To finance European partnership projects. This objective is funded by ERDF.

European Social Fund

The European Social Fund (ESF) is the main financial tool through which the European Union translates its strategic employment policy aims into action. ESF aims to improve employment opportunities in the European Union by providing financial support towards the running costs for vocational training schemes, guidance and counselling projects, job creation measures and other steps to improve the employability and skills of both employed and unemployed people. ESF also provides support for research and improving the capacity of organisations to better help their target communities.

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European Regional Development Fund

The European Regional Development Fund (ERDF) is aimed at reducing regional imbalances and assisting disadvantaged regions, particularly, run-down areas facing restructuring problems and industrial decline and rural areas. ERDF will support activity which leads to job creation through investment in infrastructure, businesses, the environment, tourism and community economic development.

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Cohesion Fund

The Cohesion Fund is aimed at Member States whose Gross National Income (GNI) per inhabitant is less than 90% of the Community average. It serves to reduce their economic and social shortfall, as well as to stabilise their economy. For the 2007-2013 period the Cohesion Fund concerns Bulgaria, Cyprus, the Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Malta, Poland, Portugal, Romania, Slovakia and Slovenia. Spain is eligible to a phase-out fund only as its GNI per inhabitant is less than the average of the EU-15. For further information about the Cohesion Fund please visit: http://europa.eu/legislation_summaries/agriculture/general_framework/g24233_en.htm

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