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Green fears over Polish plans to divert future EU billions for the environment into massive road building


Brussels/Krakow, April 21, 2005 -- Polish plans to spend a disproportionately high share of future EU aid on road-building would jeopardise Poland's ability to meet EU environmental standards within its agreed transition periods. [1] Environmental NGOs who have seen Poland's draft National Development Plan (NDP) for the 2007-2013 EU funding period [2] have raised the alarm and are calling on the Polish government to redraft the document.

Andrzej Gula, from the Polish Institute on Environmental Economics, commented, "Compared to the current 2004-2006 plan, the proposed National Development Plan is much more advanced and it incorporates important policy instruments to eliminate development gaps in Poland. However, there are still areas of the NDP which require significant changes. Among them is the proposed over-emphasis on new road building which is set to completely overshadow much-needed investments in sustainable transport schemes such as the promotion of the railways."

Out of the EU's Cohesion Fund, Poland plans to use at least EUR 15.3 billion for transport infrastructure and only EUR 5.3 billion for the environment during the seven-year period. This would run contrary to the practice since the establishment of the Cohesion Fund in 1993 where the fund's resources have always been split 50-50 between transport and environment.

Within the proposed transport budget in Poland, at least EUR 11.2 billion from the Cohesion Fund would be used for roads and only EUR 4.1 billion for railways, despite the EU's official aim, as per the 2001 White Paper on Transport, of shifting transport from roads to rails.

The NDP proposal comes at a time when the Polish government is closing some of its railway lines due to a lack of investment funds for railway rehabilitation and modernization. The Cohesion Fund is only part of the overall road bias in Poland's proposed EU funding allocations, with further billions for road-building set to be invested from the EU's structural funds, the national budget and private sources. [3]

The draft Polish NDP comes ahead of crucial decisions about the future of the EU's cohesion policy and the EU budget in the 2007-2013 period. [4] Although the allocations, rules and priorities for the EU funding have not yet been decided, member states are already preparing their plans for using the EU funds. The plans will still have to be approved by the Commission, probably in the first half of 2006.

Data shows that Spain, Portugal and Greece, until now the main beneficiaries of EU funds, were still economically lagging behind the EU-15 average despite having also invested EU funds into extensive road building projects. Ireland, although it has invested relatively less into transport infrastructure and more into human capital and its knowledge economy, has overtaken the rest of Europe. Yet even Spain, Portugal and Greece have always used the Cohesion Fund equally for transport and environment infrastructure.

Magda Stoczkiewicz, of CEE Bankwatch Network and Friends of the Earth (in Brussels), said, "The Commission must demand that Poland changes its plan for using EU funds. EU taxpayers' resources should not be used by any country in violation of the EU's commonly agreed objectives, such as decoupling economic growth from transport growth, shifting transport investment from roads to rail and achieving Kyoto targets in reducing greenhouse gas emissions. Poland's draft NDP shows that when the Council, Parliament and the Commission come to negotiate the new regulations and strategic guidelines for the 2007- 2013 period, they must set strong common priorities to ensure that future EU funding is not used irresponsibly or against the environment."

Andrzej Gula added, "The Polish government's plan would seriously jeopardise its own commitments to meet EU environmental standards. The investment focus for the EU and Polish funds should be weighted towards new technologies, education, energy efficiency, renewable energy sources, and sustainable public transport instead. An
efficient, competitive and sustainable knowledge economy for the 21st century does not come about by investing in roads but by investing in human brains."


Contacts:

Andrzej Gula, Polish Institute of Environmental Economics: tel: +48 12 6319083, mobile: +48 609465783

Magda Stoczkiewicz, CEE Bankwatch/Friends of the Earth Europe tel: +32 2 542 01 88

Anelia Stefanova, CEE Bankwatch, Transport Coordinator: tel: +359 887 854 407

Notes for editors:

1. Prior to its EU accession, Poland negotiated transition periods for the implementation of a range of EU's environmental laws related to air and water quality, waste management and industrial pollution. The transition periods for different laws will expire between 2005 and 2017, by which dates Poland has to comply with the respective laws. The cost of implementation is estimated at EUR 34 835.3 million by the end of the transition period (see: Financial Flows for Implementing EU Environmental Directives in Poland, Lithuania, Latvia and Estonia,
http://www.bankwatch.org/publications/studies/2003/financial_flows_iee_09-03.pdf .

2. The National Development Plan 2007-2013, prepared by the recently resigned Deputy Prime Minister Jerzy Hausner, is Poland's mammoth application for EU funding and at the same time its most important strategic document which provides the directions for the long-term socio-economic development of the country. See:
http://www.npr.gov.pl/Projekt+NPR+2007++2013/ (in Polish)

3. The overall amounts (including national and private co-financing), are even more unbalanced: EUR 27 billion for roads, EUR 6.2 billion for railways and EUR 10.1 billion for the environment. However, many more billions would be invested into roads under the regional budgetlines in the NDP. The overall NDP budget amounts to EUR 142.2 billion, out of which EUR 73.6 billion should be paid from the EU funds. Still, the NDP proposal does not include additional EU funding for transport under the Trans-European Networks budgetline as well as loans from the European Investment Bank.

4. A series of new cohesion policy regulations, published by the Commission in 2004, which will set the rules for EU funding in 2007- 2013, is currently being discussed in the Council and Parliament and should be adopted in Summer or Autumn 2005. The regulations will be followed by the Community Strategic Guidelines, which will set the common priorities for spending the EU funds. The Guidelines should be published by the Commission in June or July and adopted by the Council and Parliament by the end of 2005. In June 2005, the EU will also attempt to reach a deal over the EU budget for the 2007-2013 period.

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