EU-FUNDED AIRPORT INFRASTRUCTURE: NEED FOR BETTER SUPERVISION

Transport infrastructure projects, including airport-related actions, are an important area of spending from the EU budget. The EU has spent over 4.5 billion euro on air transport related investments in the years 2000-2013 via the ERDF, the Cohesion Fund and the TEN-T programmes. Out of this sum 1.2 billion euro was spent on airport-related investment in technologies and multi-modal connections and 500 million on studies and smaller infrastructure works in airports in non-cohesion policy areas. This leaves 2.8 billion directly spent on airport infrastructure, out of which 75% of this sum went to four Member States:

1. Spain (24%)
2. Poland (21%)
3. Italy (17%)
4. Greece (13%).

 European Court of Auditors findings

 The ECA arrived at the conclusion that:

• The EU-funded investments in airports produced poor value for money: too many airports (which were often in close proximity to each other) were funded and in many cases the EU-funded infrastructures were oversized;
• A need for EU-funded investments in airport infrastructure could be demonstrated only for around half of the projects examined;
• There were delays in construction and the final delivery of airport infrastructure in 17 and cost overruns in 9 of the 20 airports examined;
• More than half of the newly built or upgraded infrastructures were not fully used. In some cases, this was even so at peak hours;
• The EU-funded investments did not always lead to anticipated results: actual passenger numbers fell significantly short of initial forecasts and only 10 out of 20 airports succeeded in increasing their passenger numbers between 2007 and 2013. Improvement in customer service was in most cases not measured; there is the risk that they may need to be closed unless they receive continuous public financial support. This is particularly the case with small regional airports having fewer than 100 000 passengers per year.
•  EU funding of airports is not well coordinated at national level and, in particular as regards Major Projects and Cohesion Fund Projects, is insufficiently supervised by the Commission. For projects selected by the Member States the Commission generally does not know which airports receive funding and how much they receive.

ECA recommendations

In light of its findings the ECA recommended that:

1. The Commission should ensure during the 2014-2020 programme period that Member tates only allocate EU funding to airport infrastructures in those airports which are financially viable and for which investment needs had been properly assessed and demonstrated. This should be part of the approval and monitoring of Operational Programmes carried out by the Commission.
2. The Member States should have coherent regional, national or supranational plans for airport development to avoid overcapacity, duplication and un-coordinated investments in airport infrastructures.

 Recommendations of the EP Committee on Budgetary Control

1. The Budgetary Control Committee acknowledges that the Commission has already put in place changes which address many of the issues outlined in the ECA report and broadly supports the new regulatory framework described by the Commission. With this in mind it proposes that the Commission should report back to the Budgetary Control Committee in 12 months with progress against these recommendations.
2. The Committee supports the Court's recommendation that Member States have coherent plans for airport development and recommends that these plans be approved by the Commission before any funding for specific projects is granted. Further, it recommends that these regional, national or supranational plans should take into account not only air transport but other public transport with similar travel times to flight times including trains and buses in order to avoid market saturation and increase service viability.
3. The Committee recommends funding only being granted to financially viable airports but note the Commission’s reply which states that some regional airports must be maintained for communication purposes for regions or communities or for public authorities. In these instances, special cases may be approved by the Commission where an appropriate business plan is presented as part of a broader financially viable national strategy.
4. The Committee recommends that the Commission examines all new projects in light of a catchment area analysis to ensure viability.
5. The Commission should closely monitor, as a priority, Member States that the report identifies as having particularly problematic projects in the past.