Competition Commissioner Neelie Kroes commented: "In the past 14 months, unprecedented rescue measures allowed Europe to stabilise financial markets and help to pave the road to recovery. By vetting this aid quickly, and strictly controlling its use, we have ensured state aid is part of the solution to the crisis. We have now entered the restructuring phase for the banking system with first important decisions already taken – for example on KBC, ING, Lloyds, Fortis and Commerzbank. In 2009, we have also allowed additional aid to the real economy to offset the credit crunch. I very much welcome that Member States, despite the difficult times, maintained state aid discipline and continued their efforts to re-direct aid for horizontal objectives of common interest such as research. Well- targeted aid should thus continue to help us move along the road to economic recovery."
Aid to overcome the financial crisis
Coordinated action by Member States and the Commission as well as the introduction of crisis-specific rules has allowed the rapid implementation of aid schemes and ad hoc measures that do not undermine the EU's level playing field.
Total crisis support made available by Member States and approved by the Commission in 2008 was € 3361 billion. The nominal amount of crisis support actually implemented by Member States in 2008 was much lower and stood at € 958 billion. The state aid element of this amount is estimated at € 212.2 billion or 1.7% of EU-27 GDP. The aid element is significantly lower than the nominal amount, in particular because the aid element of state guarantees normally constitutes only a small fraction of the guaranteed amounts. Furthermore, real budgetary expenditure materialises only when a state guarantee is actually drawn upon.
Member States continue effort to re-direct aid to horizontal objectives
Financial crisis measures aside, Member States stood on track with their efforts to re-direct aid towards horizontal objectives of common interest. Some 88% of aid to industry and services is now directed towards horizontal objectives of common interest, while non-crisis rescue and restructuring aid fell. Most notably, the Commission observes a greater focus on regional aid and aid for research, development and innovation which in turn is expected to foster future job growth opportunities.
Simplification and flexibility
Reforms from the State Aid Action Plan 2005–2008 (see IP/05/680 ) continue to bear fruit. New e xemptions from ex ante Commission scrutiny, either by the de minimis Regulation (see IP/06/1765 ) or by the recently adopted General Block Exemption Regulation (see IP/08/1110 ), are reducing administrative burdens without affecting the level playing field. In terms of aid volume, around 19% of aid is granted through block exemptions. In addition, another 76% of state aid is assessed by the Commission under aid schemes. Such schemes or programmes, once approved by the Commission, allow Member States to grant aid to a high number of beneficiaries without further Commission scrutiny. Measures subjected to individual assessment at the level of the beneficiary account for only 5% of total aid. This gives Member States a high degree of flexibility, while compatibility criteria safeguard the Single Market.
Enforcement
The Scoreboard notes further progress in the recovery of illegal and incompatible aid. At the end of June 2009, € 9.4 billion has been effectively recovered. Only 9% of unlawful aid is still outstanding which means that 91% of the total amount of illegal and incompatible aid had effectively been repaid by its beneficiaries, compared with only 25% at the end of 2004.
