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EU funded urban transport projects underutilised, say EU Auditors

A report published today by the European Court of Auditors (ECA) reveals that two thirds of urban transport projects co-financed by EU structural funds are underutilised. Weaknesses in project design and inadequate mobility policy were two of the main contributory factors identified.

“Most of the audited projects were implemented as planned and were meeting users’ needs. However we have discovered significant underutilisation of the services provided, with two thirds of them having fewer users than expected. This also implies underperformance in terms of economic and social benefits, such as reduction of pollution levels and congestion,” stated Mrs Iliana Ivanova, the ECA Member responsible for the report, “In these times of budgetary constraints, each euro spent from the European budget should effectively address identified needs. In that context, we have made five concrete recommendations to the Commission in order to improve the quality and results of the future projects. ”

The EU auditors analysed the performance of 26 public urban transport projects in 11 cities in five Member States. For each project, the audit team met the relevant stakeholders involved in implementing the audited projects. The auditors also physically visited the co-financed facilities, and the operating and maintenance centres. They found that overestimation of users and the lack of coordination between modes of transport, parking policy and the absence of urban mobility plans contributed to underutilisation.

The proportion of the European population residing in urban areas is expected to increase from 73 % in 2010 to 82 % by 2050. Meanwhile, European cities need to enhance mobility and to reduce congestion, accidents and pollution through local mobility policies. The European Regional Development Fund and the Cohesion Fund co-finance urban transport projects in eligible regions of the Member States. The EU contribution, for urban transport projects, typically represents up to 85 % of the related eligible expenditure. The EU funding allocated to urban transport for the 2000-2006 and 2007-2013 periods was € 10.7 billion, i.e. € 2.9 billion and € 7.8 billion, respectively. These projects help cities to implement urban transport such as metros, trams and buses.

European Court of Auditors (ECA) special reports are published throughout the year, presenting the results of selected audits of specific EU budgetary areas or management topics.

This special report (No 1/2014) entitled “Effectiveness of EU-supported public urban transport projects” – assessed the implementation and the effectiveness of public urban transport projects co-financed by EU structural funds, and whether they meet user needs and they achieve their objectives in terms of utilisation.

The audit covered a sample of 26 projects co-financed by the European Regional Development Fund or the Cohesion Fund during the 2000-2006 and 2007-2013 programming periods. The selected projects were located in 11 cities in five Member States – Spain, France, Italy, Poland, and Portugal. The EU funding allocated to urban transport in these five countries (€ 5.3 billion) represents 50 % of the total EU funding (€ 10.7 billion). The sample included projects that consisted of creating, extending or modernising railways (three), metros (eight), light metros (four), trams (six) and one bus project. They ranged from a single line or a simple section to a whole network. The sample also included four smaller IT projects relating to operating, information or ticketing systems

The EU auditors concluded that, in general, infrastructure and vehicles for most projects were implemented in accordance with project specifications. Significant delays affected four urban transport projects and three projects had significant cost overruns. Once completed, almost all the projects audited met users’ needs. However, a comparison between planned use at specific dates and actual use shows that two thirds of the projects were underutilised. This implies underperformance in terms of economic and social benefits (reductions in pollution and congestion etc.) which is generally not followed up by the promoters or the national authorities. It may also imply financial imbalances for the public authorities that have to ensure the sustainability of the urban transport concerned. The underutilisation of public transport is mainly due to weaknesses in project design and mobility policy. Several could have been addressed at the project planning stage.

Based on its findings, the ECA recommended that the EU Commission require that:

  • management tools be put in place to monitor the quality of the service and the level of user satisfaction once projects are operational;
  • a minimum number of result indicators with related targets be included in the grant agreements and are subsequently measured;
  • the estimation of the number of expected users is more rigorously analysed and that the choice of the mode of transport is supported by a quantified comparison of different transport options;
  • urban transport projects be included in a sound mobility policy;
  • these relevant recommendations also be addressed by the Member States’ authorities when managing EU-funded urban transport projects.

A short video interview with the ECA Member responsible for the report is available at: https://www.youtube.com/user/EUAuditorsECA

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