ex-post evaluation of objective 6 programmes for …...ex-post evaluation of objective 6 programmes...

EX-POST EVALUATIONOF OBJECTIVE 6 PROGRAMMES FOR

THE PERIOD 1995–99

Country Report for Finland

Arttu Vainio & Pia LaurilaLevón Institute

University of VaasaFinland

December 2002

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LEGAL NOTICE

This study was commissioned by the Directorate-General for Regional Policy of the EuropeanCommission. It does not necessarily reflect the official position of the European Commission.

Neither the European Commission nor any person acting on behalf of the Commission is responsi-ble for the use which might be made of the following information.

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TABLE OF CONTENTS

SUMMARY (in Finnish) .............................................................................................................................................3

1. INTRODUCTION ................................................................................................................................................ 92. METHODOLOGY ............................................................................................................................................. 133. RELEVANCE OF THE STRATEGY AND PROGRAMMING CHOICES ......................................................... 16

3.1. Regional analysis of the programming area .................................................................................................. 163.2. Overview of the strategic planning process and the programme structure ...................................................... 183.3. Assessment of the relevance of the strategy and programming choices.......................................................... 22

4. ANALYSIS OF THE DELIVERY AND IMPLEMENTATION SYSTEMS........................................................ 294.1. Administrative structure of the programme and the start-up of the programme implementation ..................... 294.2. Strategic planning capacity of the management............................................................................................. 304.3. Execution of the project selection procedures ............................................................................................... 314.4. Efficiency of the financial circuits ................................................................................................................ 334.5. Functioning of the partnership...................................................................................................................... 334.6. Performance of the monitoring system and the quality control ...................................................................... 34

5. EFFECTIVENESS AND FINANCIAL ALLOCATION ANALYSIS.................................................................. 375.1. Assessment of the financial allocation .......................................................................................................... 375.2. How did projects contribute to achieving the goals of the programme?.......................................................... 41

6. IMPACT AND EFFICIENCY ANALYSIS......................................................................................................... 476.1. Development of population .......................................................................................................................... 476.2. Job creation and employment ....................................................................................................................... 496.3. Promotion of entrepreneurship ..................................................................................................................... 536.4. Meeting the aims and objectives of the Community priorities ....................................................................... 556.5. Insight into the unforeseen impacts of the programme .................................................................................. 576.6. Perspectives concerning the efficiency of the programme ............................................................................. 58

7. COMMUNITY VALUE ADDED....................................................................................................................... 617.1. Institutional dimension ............................................................................................................................ 617.2. Policy/priority aspects.................................................................................................................................. 627.3. Cooperation and networking ........................................................................................................................ 63

8. LESSONS FOR THE FUTURE .......................................................................................................................... 659. CONCLUSIONS ................................................................................................................................................ 70

APPENDIX. Objective 6 Programme; Priorities and Measures................................................................................... 72

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TIIVISTELMÄ

Johdanto

Suomi liittyi Euroopan unioniin yhdessä Ruotsin ja Itävallan kanssa vuonna 1995. Uusissa jäsen-maissa oli alueita, joiden ongelmat olivat hyvin erilaisia verrattuna vähemmän kehittyneisiin aluei-siin unionin vanhoissa jäsenmaissa. Suomessa ja Ruotsissa erityisen ongelman muodostivat pohjoi-set alueet, joille oli leimallista muun muassa harva asutus, pitkät etäisyydet, taloudellinen jälkeen-jääneisyys ja vaikea työllisyystilanne. Vuonna 1995 Euroopan komissio käynnisti Tavoite 6 -ohjelman, joka tähtäsi näiden alueiden erityisongelmien ratkaisuun Suomessa ja Ruotsissa. Ohjel-maa toteutettiin kumpaakin jäsenmaata koskevien erillisten ohjelma-asiakirjojen mukaisesti 1995 -1999.

Vuonna 2001 komissio tilasi kokonaisarvioinnin ohjelman tuloksista Suomessa ja Ruotsissa. Arvi-ointi toteutettiin Vaasan yliopiston, Uumajan yliopiston ja Bradley Dunbar Associatesin yhteistyönäsiten, että Vaasan yliopisto teki Suomea koskevan arvioinnin ja Uumajan yliopisto Ruotsia koske-van arvioinnin. Vaasan yliopisto vastasi molempia maita koskevan synteesiraportin tuottamisesta.Bradley Dunbar Associatesilla oli arvioinnissa avustava rooli.

Suomessa Tavoite 6 -ohjelmaa toteutettiin Lapin, Kainuun, Pohjois-Karjalan ja Etelä-Savon maa-kunnissa sekä eräissä Keski-Suomen, Pohjois-Savon, Pohjois-Pohjanmaan ja Keski-Pohjanmaanseutukunnissa. Tämä on tiivistelmä Suomea koskevan Tavoite 6 -ohjelman jälkiarvioinnin loppura-portista. Loppuraportti on julkaistu kokonaisuudessaan nimellä ”Ex-post Evaluation of Objective 6Programmes for the Period 1995 - 1999; Country Report for Finland”.

Strateginen suunnittelu

Ohjelma-asiakirjassa (Single Programming Document) Tavoite 6 -alueen keskeisiksi ongelmiksimääriteltiin korkea työttömyys ja talouden rakenteelliset ongelmat. Rakennemuutos oli vähentänyttyöpaikkojen määrää erityisesti alkutuotannossa. 1990-luvulla työpaikkojen määrä oli laman seura-uksena vähentynyt myös julkisella sektorilla. Työpaikkojen vähentyminen oli johtanut jo vuosi-kymmeniä jatkuneeseen väkiluvun alenemiseen sekä väestön keski-iän kohoamiseen erityisesti alu-een maaseutukunnissa.

Alueen ongelmiksi todettiin työvoiman alhainen koulutustaso, alueen harva asutus ja pitkät etäisyy-det sekä riippuvuus toimialoista, joilla ei ole merkittävää kasvupotentiaalia. Ohjelman toimenpi-teillä pyrittiin parantamaan osaamista ja kehittämään uusia yritystoimintamalleja. Tavoitteena oliparantaa alueen kilpailukykyä ja lisätä uusien yritysten toimintamahdollisuuksia kasvualoilla, jollai-siksi katsottiin muun muassa uuden teknologian yritykset ja matkailuala. Alkutuotantoa kehitettiintukemalla uusia sivuelinkeinoja, tehostamalla tuotantoa ja turvaamalla maatalousyrittäjien tulotasoa.

Ohjelma-asiakirjassa todettujen kehittämiskohteiden valinta oli perusteltu. Valituilla kehittämis-kohteilla tähdättiin alueen todellisten ydinongelmien ratkaisemiseen. Ohjelman suunnitteluvaihees-sa tehtiin joitakin tavoitteenasetteluun ja voimavarojen kohdistamiseen liittyviä virheitä. Ohjelmalleasetettiin liian korkeat määrälliset tavoitteet ja ohjelman resursointi toteutettiin liian yksityiskohtai-sella budjetointimenetelmällä. Ohjelmakauden aikana tavoitteita tarkistettiin ja varoja suunnattiinuudelleen. Suunnitteluvaiheessa tehdyt virheet johtivat joidenkin hankkeiden viivästymiseen, muttaohjelman tuloksiin nämä ongelmat eivät juuri vaikuttaneet.

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Ohjelma-asiakirjan (SPD) strategiavalinnat olivat väljiä. Tämä antoi mahdollisuuden hyvin monen-laisten hankkeiden käynnistämiseen. Alueen monimuotoisuus huomioon ottaen ratkaisu oli hyvä.Esimerkiksi Lapissa ja Etelä-Savossa olosuhteet poikkeavat hyvin paljon toisistaan. Toisaalta stra-tegiavalintojen väljyys johti myös kohdentamisongelmiin, joista seurasi resurssien liiallista levittä-mistä. Kehittämistyön tavoitteet olisi ehkä pitänyt määritellä maakuntatasoisesti tarkemmin, jottavoimavarat olisi voitu suunnata tehokkaammin ydintavoitteiden saavuttamiseen.

Yksi ohjelman parhaista saavutuksista on uudenlaisen alueellisen kehittämiskulttuurin syntyminen.Eri hallinnonalojen välinen todellinen yhteistyö lisääntyi sekä ministeriöiden välillä että varsinkinaluehallinnon eri yksiköiden välillä. Laajentunut yhteistyö on parantanut aluekehitystyön edellytyk-siä kaikilla tasoilla. Ohjelman suunnittelun aikana tämä yhteistyö oli vielä puutteellista, mikä selit-tää myös maakunnallisen suunnittelun puutteellisuutta varsinkin toiminnan alkuvaiheessa.

Tavoite 6 -ohjelman suunnitteluvaiheen merkittävimpiä virheitä oli toimivan ohjelmatasoisen seu-rantajärjestelmän puuttuminen. Ministeriöiden tietokannoissa olevien tietojen yhdisteleminen olivaikeaa. Lisäksi saatavissa olleet tiedot olivat ministeriökohtaisestikin epäluotettavia. Tämän vuoksihallinnolla oli ohjelmakauden loppuun saakka vaikeuksia saada ajantasaista tietoa ohjelmaan liitty-vistä asioista. Rahoituksen käytön seuranta toimi tyydyttävästi, mutta ohjelman tuloksellisuuttakoskeva mittaus oli erittäin ongelmallista.

Toimeenpanojärjestelmä

Ohjelmatyön vaatima menettely poikkesi huomattavasti Suomessa aiemmin sovelletuista toiminta-tavoista. Ministeriöt eivät olleet tottuneet tekemään laajaa keskinäistä yhteistyötä aluekehittämisensuunnittelussa ja toimeenpanossa. Myös aluehallinnon tasolla se oli ollut vähäistä. Tavoiteohjelma-perusteisessa suunnittelussa yhteistyö oli kuitenkin välttämättömyys. Eri sektoreiden välinen yh-teistyö kaikilla tasoilla oli uutta kaikille toimijoille. Myös päätösvallan uusi jakautuminen muuttiasetelmia. Hallinnossa uudistettiin siten samanaikaisesti aluekehityksen suunnittelu, toimeenpanoaja työnjakoa.

Vei jonkin verran aikaa ennen kuin uusi toimintamalli alkoi kokonaisuudessaan toimia, sillä uudis-tusten suuri määrä ja tiukka aikataulu johtivat väkisinkin lieviin viivästyksiin. Tilannetta olisi voituparantaa kaikille tasoille tarjotun paremman koulutuksen avulla – ainakin jos joku olisi pystynytuudessa tilanteessa sellaista antamaan. Työn alkuvaiheessa kokemuksen, käytäntöjen ja osaamisenpuute aiheuttivat ongelmia koko hallinnolle.

Uutta toimintamallia yritettiin aluksi soveltaa liian vähäisin henkilöresurssein. Työvoimaa oli liianvähän ja työntekijöiltä puuttui kokemusta uusista toimintamalleista. Tämän seurauksena esimerkiksiannettuja ohjeita jouduttiin muuttamaan useita kertoja ja annettuja tehtäviä priorisoimaan. Tällöinesimerkiksi seurannan kannalta olennaisen seurantatiedon käsittely jäi varsinkin ohjelmakauden al-kuvaiheessa selkeästi toissijaiseksi.

Hallinnosta vastanneiden virkamiesten lisäksi kokemuksen puutteesta kärsivät myös hanketoimijat.Uudesta toimintamallista johtuen potentiaalisia hanketoimijoita oli vähän ja heillekin uudet käytän-nöt aiheuttivat yllätyksiä. Hakumenetelmät, maksatusjärjestelyt ja ennen kaikkea seurantamallitpoikkesivat siitä, mihin hanketoiminnassa oli aiemmin totuttu. Tämän vuoksi monia asioita joudut-tiin tekemään useampaan kertaan, mikä kuormitti hankevetäjien lisäksi myös hallintoa. Ongelmanavoidaan pitää myös kaikkien osapuolien kokemattomuutta bottom-up -periaatteen toiminnasta. Ak-

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tiivisia toimijoita ei varsinkaan ohjelmakauden alussa juurikaan ollut. Toisaalta hallinto ei pystynytaluksi ohjaamaan, ohjeistamaan ja aktivoimaan hanketoimijoita.

Ohjelmakauden alkuvaiheen ongelmat voidaan tiivistää kahteen perusongelmaan, jotka olivat re-surssipula ja kokemattomuus. Ohjelmakauden kuluessa toiminta kuitenkin kehittyi huomattavasti.Kaikkien tasojen toimijat ministeriötasolta hanketoimijoihin oppivat tehtävänsä ja samaan aikaanhallintotyöhön tarvittavia resursseja lisättiin. Ohjelmakauden lopulla kaikki edellä kuvatut ohjelmankäynnistämisen liittyvät ongelmat olivat vähentyneet huomattavasti. Hanketoimijoita oli enemmänja tehdyt hakemukset olivat laadukkaampia, hankkeiden hallinnollinen ohjaus toimi paremmin jamaksatusjärjestelmäkin toimi nopeammin.

Seurannan kunnollinen järjestäminen oli muista toiminnoista poiketen ongelmallista ohjelmakaudenloppuun saakka. Alkuvaiheessa hanketoimijoita ja aluehallintoa ei ohjeistettu riittävän selkeästiluotettavan seurantatiedon saamiseksi. Ongelmia aiheutti myös eri ministeriöiden järjestelmienkautta kerätyn tiedon yhdistäminen yhdeksi, Tavoite 6 -ohjelmaa koskevaksi kokonaisuudeksi. Ra-hoitusta koskevan ohjelmatasoisen tiedon kerääminen oli jatkuvasti vaikeaa, mutta suurimpia on-gelmia tuotti tuloksellisuutta koskevan tiedon kerääminen. Hanketasolla annetut tiedot saavutetuistatuloksista osoittautuivat liioitelluiksi eikä näin syntynyttä vääristymää saatu korjattua muillakaantoiminnan tasoilla. Tämän vuoksi ohjelman virallinen tuloksellisuusseuranta antoi toiminnan suun-nittelun ja arvioinnin kannalta enimmäkseen käyttökelvotonta tietoa.

Kokonaisuudessaan Tavoite 6 -ohjelman toimeenpanojärjestelmä toimi kohtuullisen hyvin. Alku-vaiheen vaikeudet liittyivät kokemuksen puutteeseen ja liian vähäisiin resursseihin. Kun nämä on-gelmat oli saatu ratkaistua, koko ohjelmatyö alkoi vähitellen tuottaa parempia tuloksia. Ohjelma-kauden alku voidaankin nähdä oppimisprosessina, jonka tuloksia päästiin hyödyntämään kunnollavasta saatujen kokemusten pohjalta. Työnjaon ja eri tehtävien selkiytyminen mahdollistivat toimin-nan selkeämmän suunnittelun ja hanketoimijoiden ohjeistamisen. Näin myös toiminnan parhaat tu-lokset on saavutettu ohjelmakauden loppupuolella.

Tehokkuus ja rahoituksen kohdistaminen

Rahoituksen kohdentamisessa kohdattiin samanlaisia ongelmia kuin ohjelman toimeenpanossa.Ohjelmakauden alussa tehtiin joitakin ratkaisuja, jotka eivät olleet ohjelmatyön kannalta mielek-käitä. Keskeisin näistä oli rahoituksen momenttikohtainen suunnittelu ennen ohjelmatyön aloitusta.Ongelmia lisäsi alueellisen rahanjaon kaavamainen toteutus. Rahoitus jaettiin aluehallinnon tasollemaakuntien asukasluvun mukaan.

Ennen ohjelmakauden alkua oli huomattavan vaikea ennakoida minkä tyyppisille hankkeille seu-raavan viiden vuoden aikana tulisi olemaan eniten tarvetta. Tästä huolimatta rahoitus pyrittiin suun-nittelemaan ennakolta, mikä aiheutti myöhemmin ongelmia. Toisaalla rahaa olisi tarvittu enemmän,toisaalla sitä ei voitu käyttää mielekkäiden hanke-ehdotusten puuttumisen takia. Poikkeamat johtui-vat alkuvaiheessa tehdyistä virhearvioinneista ja myös alueiden erilaisuudesta, jota ei oltu otettuhuomioon. Esimerkiksi maatalouden rakenteessa on suuria eroja Itä- ja Pohjois-Suomen välillä.

Edellä kuvatut virheet eivät sinällään estäneet ohjelman toteuttamista. Tehtyjä suunnitelmia muu-tettiin todellisia olosuhteita vastaaviksi ohjelmakauden aikana. Tällöin rahaa siirrettiin ohjelmansisällä momentilta toiselle niin, että alueellisten eroavuuksien ja suunnitelmien sisällöllisten muu-tosten vaatimukset otettiin huomioon.

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Hanketoimijat moittivat ohjelmaa ja viranomaisia byrokratian raskaudesta. Päätöksentekoa pidettiinmonissa tapauksissa liian hitaana ja hankkeisiin liittyvää rahaliikennettä sekä työläänä että hitaana.Hanketoimijat kuitenkin myönsivät, että monissa tapauksissa kysymys oli osaamattomuudesta han-ke- ja maksatushakemusten täyttämisessä. Tilanteen koettiin parantuneen huomattavasti ohjelma-kauden lopulla, kun viranomaiset ja hankehallinnoijat oppivat ohjelmakauden alussa tehdyistä vir-heistä.

Hallinnollisesta näkökulmasta ohjelmatyö oli lopulta onnistunutta; kaikki resurssit käytettiin suun-nitelmien mukaisiin tarkoituksiin. Lisäksi toiminnalla oli erittäin laaja kohderyhmä, mikä on sinäl-lään erittäin hyvä tulos. Alkuvaiheessa koetut ongelmat vaikuttivatkin lähinnä toimenpiteiden aika-tauluun. Ohjelmakauden loppua kohti viranomaisten välinen yhteistyö kehittyi merkittävästi, hal-linnolliset käytännöt vakiintuivat ja ohjelmatyö muuttui tehokkaammaksi. Ohjelmakauden alkuvai-hetta voidaankin pitää kaikkien toimijoiden kannalta oppimisprosessina, jonka tuloksista päästiinnauttimaan ohjelmakauden loppupuolella.

Kokonaisuudessaan Tavoite 6 -ohjelman toimenpiteet kohdistuivat ohjelman keskeisten tavoitteidenja alueen todellisten tarpeiden mukaisesti. Hallinnon ongelmatilanteet pystyttiin kauden aikana rat-kaisemaan ja ohjelmatyön myönteiset piirteet korostuivat erityisesti ohjelmakauden lopulla.

Vaikutukset ja tuloksellisuus

Ohjelman alkuperäinen tavoite oli kuroa kiinni ohjelma-alueen taloudellista jälkeenjääneisyyttämuuhun Suomeen nähden. Tässä ei onnistuttu. Alueen väkiluku vähenee edelleen ja alueelta muut-tavat erityisesti hyvin koulutetut nuoret. Työttömyys on pysynyt muuhun maahan verrattuna korke-alla tasolla eikä palvelualan tai uutta teknologiaa hyödyntävien yritysten määrä ole merkittävästikasvanut.

Pelkästään alueella tapahtuneita muutoksia tarkastelemalla vaikuttaa siltä, ettei Tavoite 6 -ohjelmaole saavuttanut sille asetettuja tavoitteita. On kuitenkin huomattava alueen yleinen kehitys. Suu-rimmat työllistäjät eli alkutuotanto ja julkinen sektori ovat kriisissä. Niiden työpaikkamäärä piene-nee. Korvaavia työpaikkoja ei ole pystytty synnyttämään tarpeeksi nopeasti, jotta alue voisi tavoit-taa muun maan kasvulukuja.

Tavoite 6-ohjelman taloudellista kehitystä koskeva tavoitteenasettelu tehtiin liian optimistisesti.Ohjelman suunnitteluvaiheessa alueen rakenteelliset ongelmat ja yleisen taloudellisen kehityksenvoima aliarvioitiin. Nopea talouskasvu ohjelma-alueen ulkopuolella synnytti nopeasti kysyntäätyöttömälle työvoimalle. Vastaavasti työpaikkakehityksen suhteen julkisista palveluista ja alkutuo-tannosta riippuvaisella ohjelma-alueella talouskasvu oli huomattavasti hitaampaa. Alueen taloudel-linen noidankehä paheni 1990-luvun loppupuoliskolla. Kun työtilaisuuksia oli vähän, väkiluku vä-heni ja pienensi kulutuskysyntää, jolloin yritysten kasvulle ei ollut pohjaa. Kun uusia työpaikkoja eisyntynyt, muuttopaine kasvoi ja väkiluku väheni edelleen. Ulospääsyä tästä kierteestä oli vaikealöytää.

Ilman Tavoite 6 -ohjelmaa kehitys olisi ollut vielä huomattavasti heikompi kuin nyt koettu. Koulu-tus- ja kehittämistoimenpiteillä parannettiin työvoiman ammattitaitoa, monipuolistettiin elinkeinojaja löydettiin uusia mahdollisuuksia elannon hankkimiseen. On myös huomattava, että ohjelma syn-nyttää tuloksia vielä myöhemminkin. Ohjelmakauden aikana saadun osaamisen jalostuminen kan-nattavaksi liiketoiminnaksi voi kestää vuosia.

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Kehittämistoimenpiteiden pitkävaikutteisuudesta johtuen lopullisten tulosten arvioiminen on vaike-aa: lisäksi yritysten perustamiseen ja työllistymiseen vaikuttavat lukuisat asiat. Seurantatiedot an-toivat liian ruusuisen kuvan ohjelman vaikutuksista. Niiden mukaan alueen 280 000 työpaikasta 80000 olisi luotu tai säilytetty ohjelman avulla. Arvioissa päädyttiin siihen, että todellinen vaikutusolisi noin 12 500 säilytettyä tai luotua työpaikkaa. Luku on kuitenkin vain valistunut arvaus, koskatarkkaa tietoa ei ole mahdollista saada.

Ohjelman tuloksellisuutta on mahdotonta kuvata pelkkien työpaikkatietojen perusteella. Vaikkanumeerisesti mitattava vaikutus näyttää pienehköltä, on huomattava, että alueen asukkaiden jaasuinympäristöjen aktivoiminen on vaikeasti mitattava asia. Ohjelman vaikutus on kuitenkin kiis-tatta positiivinen ja myös pitkävaikutteinen.

Havainnot ja johtopäätökset

Uusi ohjelmaperusteinen ja hallinnonalojen yhteistyöhön perustuva aluekehittämisen malli onosoittautunut hyödylliseksi ja toiminnan suunnitelmallisuutta parantavaksi. Kaikkien aluekehitys-työn kannalta keskeisten toimijoiden yhteistyö vähentää päällekkäisyyttä, lisää synergiaetuja ja kas-vattaa kehitystyön onnistumisen mahdollisuuksia. Uudet yhteistyömuodot ovat kiistatta hyödyllisiä,vaikka lievää kritiikkiä byrokratian kasvuun kohdistuukin.

Ohjelmakauden alussa kohdattiin monia hallinnollisia ongelmia. Työvoimaa ei ollut tarpeeksi eikätoimijoiden ammattitaito ei ollut riittävä uusien tehtävien hoitamiseen. Tämä koski kaikkia hallin-nontasoja ja myös hanketoimijoita. Ohjelmakauden alkupuolta voidaankin kuvata oppimisprosessi-na, jonka aikana kaikki toimijat oppivat roolinsa ja työnjako selkiytyi. Ohjelmakauden loppupuo-lella osaamisen vähyyteen liittyviä ongelmia oli huomattavan vähän. Tulevien ohjelmien toteutta-misessa kannattaa kuitenkin ottaa tästä opiksi: työvoiman määrään ja osaamistason varmistamiseenkannattaa panostaa.

Todenmukaisten ja luotettavien seurantatietojen kerääminen on tärkeää. Vaikka ohjelman käynnis-tämisvaiheessa on oletettavasti näyttänyt tärkeämmältä saattaa ohjelma käyntiin kuin keskittyä seu-rantajärjestelmän rakentamiseen, törmättiin heikon seurantajärjestelmän aiheuttamiin ongelmiinmyöhemmin ohjelmakauden kuluessa. Tällä asialla oli kielteiset vaikutuksensa sekä ohjelman hal-linnointiin että tulosten arviointiin. Puutteelliset ja vaikeasti yhdisteltävät seurantatiedot vaikeuttivateniten ohjelmaan liittyvää päätöksentekoa. Lisäksi tietojärjestelmien yhdistely jälkikäteen on huo-mattavasti vaikeampaa ja kalliimpaa kuin toimivan järjestelmän rakentaminen ennen toiminnanaloittamista.Ohjelman suunnitteluvaiheessa käytettävissä olevia rahallisia resursseja ei tule pilkkoa liian pieniinosiin. Suuremmat, mahdollisesti maakuntakohtaiset kehittämisrahastot antaisivat mahdollisuuksialaajojen hankekokonaisuuksien hallinnoimiselle. On kaikkien toimijoiden kannalta turhauttavaa to-teuttaa samaa kehittämistoimenpidettä useammassa osassa budjetti- tai rahastoteknisistä syistä. Lii-an tarkka momentointi vaikeuttaa myös muuttuvien olosuhteiden huomioon ottamista. Myös aluei-den erilaisuus tulee voida ottaa huomioon voimavarojen kohdistamisessa.

Kokonaisuudessaan voidaan todeta, että Tavoite 6 -ohjelma oli tarpeellinen ja oikein, vaikkakinhiukan liian epätäsmällisesti suunnattu. Ohjelmalla oli laaja kohderyhmä ja se tavoitti suuren osanohjelma-alueen väestöstä. Sillä saavutettiin paljon hyviä tuloksia. Vaikka ohjelman vaikuttavuusolikin lyhyellä aikavälillä heikko, on huomattava, että pääosa työn tuloksista on nähtävissä vastavuosien kuluttua. Talouden rakenteellisista muutoksista johtuen olosuhteet ohjelma-alueella olivat

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niin vaikeat, ettei Tavoite 6 -ohjelmalla ollut käytännössä mahdollisuuksia kääntää kehityksen kul-kua.

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1. INTRODUCTION

Aims and objectives of the evaluation exerciseThe ex-post evaluation of the Objective 6 programmes for the period 1995–99 was launched by theEuropean Commission, with a view to assessing the programmes’ implementation. Geographically,the Objective 6 programmes were put into practice in the northernmost areas of Sweden and Fin-land. Therefore, the evaluation operation launched concerned the assessment of two country-specific Objective 6 programmes. This report concerns the findings for Finland only.

The overall aims and objectives of this evaluation exercise were to establish the accountability tothe public in terms of achieving economic and social cohesion and measuring the effects of the pro-gramme as a whole. Furthermore, the evaluation sought to identify findings to improve the currentprogramme period and to give input for the regional policy planned to start after 2006. This evalua-tion covered the intervention of all the Structural Funds in the Objective 6 area: the European Re-gional Development Fund (ERDF), the European Social Fund (ESF), the European AgriculturalGuidance and Guarantee Fund (EAGGF) and the Guidance Section and the Financial Instrument forFisheries Guidance (FIFG).

The overall aims and priorities of the Single Programming Documents for the Objective 6 Pro-grammes in Sweden and Finland formed the basis for this evaluation exercise1. In particular, theevaluation aimed to assess to what extent these overall aims and objectives had been achieved by:• Evaluating the impact of the Structural Funds interventions;• Measuring the effectiveness and efficiency of the interventions at regional, national and EU

level as well as within the key priorities;• Identifying the Community Value Added obtained at EU level as a result of the Structural Funds

investment;• Recognising findings from this ex-post evaluation that are relevant for improving the quality of

the current 2000–2006 programme period.

A synchronised but decentralised operationThe ex-post evaluation of the Objective 6 programmes was a synchronised, but decentralised op-eration. The evaluation was carried out by the consortium specialised in regional studies which wasappointed following a call for tender. The consortium carried out two separate but synchronisedevaluation operations focusing on the Objective 6 programme implementation, one for Sweden andone for Finland.

The evaluations each produced a Country Report, covering the afore-mentioned aims and objec-tives. In addition, the key elements of two Country Reports were brought together in a Synthesisand Comparative Report. This report synthesised the main findings of the country reports and iden-tified similarities and differences between the two reports in order to compare the successes andfailures of the Objective 6 programmes’ implementation in Sweden and Finland. Furthermore, theSynthesis and Comparative Report elaborates a comparative analysis behind the apparent successesand failures of the two programmes.

A brief insight into the area covered by the Objective 6 programmesThe Objective 6 programmes cover the northernmost regions of the European Union – the vastnorthern regions in both Sweden and Finland (Figure 1)1. The area shares a 1000 km long border

1 See Chapter 3.2. Overview of the strategic planning process and the programme structure.

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with Russia in the East and a northern and northwest border with Norway. The following regionsbelong either fully or partly to the Objective 6 area in Finland: the regions of Lapland, Kainuu,North Karelia, South Savo, North Ostrobothnia, North Savo, Central Finland and Central Ostro-bothnia.

The criteria for choosing regions and municipalities for the Objective 6 Programme were lowpopulation density, negative demographic development and severe difficulties in employment is-sues. All regions and most of the municipalities in the programme area were characterized by theseproblems. The rural municipalities had lost almost one third of their population in the past 30 years.Only a small number of regional and sub-regional centres had increased their population during thattime. They were included in the programme region in order to not split the functional economic ar-eas. Unemployment was a difficult problem in all municipalities of the area, including all towns andcities.

Figure 1. The Objective 6 Programmes’ area inSweden and Finland.

1 See the Internet website www.nordregio.se for maps and further information about Nordic Countries Sweden andFinland.

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The climate in the Objective 6 area is cold and harsh. The main features of the terrain are forest,water and swamp, with hilly areas in northern Lapland of both countries. The average populationdensity is very low. Due to the vastness of the Objective 6 area, long distances are a major con-straint and thus infrastructure plays an important role in the economic and social life of the area.Transport infrastructure, i.e. roads, railways and airports, is of a relatively high standard in the re-gion. The Objective 6 area contains vast regions of pristine natural wilderness. Because of the coldclimate, the regeneration of nature is slow. Nature conservation plays an important role in main-taining the biodiversity and the attractiveness of the environment, which is vital for tourism.

In order to demonstrate the distinct characteristics of the Objective 6 Region, one specific region isscrutinised more closely in the following. The Lapland Region covers an area of 93 000 squarekilometres and has less than 195 000 inhabitants. The population density is only 2.1 inhabitants persquare kilometre. When aiming at demonstrating the specificity of this region, the main characteris-tics of the Lapland Region could be compared with another European region as follows (Figure 2).Belgium has a population density of approximately 330 inhabitants per square kilometre and one ofits regions Flanders has 5.9 million inhabitants. The largest municipality of the Lapland RegionInari stretches over a land area of 15 173 square kilometres and has 7 452 inhabitants. This munici-pality of Inari is larger than that of the whole Flanders Region (13 522 km2).

Figure 2. The vast area of the Objective 6 Region: the Lapland Region and Belgium in comparison.Lapland covers a geographical area three times the size of Belgium whereas Belgium has50 times more inhabitants than Lapland. Some municipalities of Lapland have a larger areathan the Belgian regions.

The Objective 6 area is heavily dependent on primary production and public sector employment.Since private sector services need a certain market volume in order to be profitable, this constitutesa problem for these sparsely populated areas. Therefore, the public sector has a significant position

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in the Objective 6 area in producing services and creating jobs and economic activity. Municipali-ties are the largest employers. The forest cluster of the Objective 6 area is also strong. Agriculture,which plays a less important role, is mainly dairy farming. The basic physical infrastructure andeducation, social and health care services are well maintained. The clean environment and attractivelandscape offer outdoor and recreational possibilities for the development of tourism sector.

The region has special expertise in the forestry sector and in the processing of timber. In particular,the special quality of slowly grown timber offers opportunities for more advanced production.However, the general lack of jobs leads to social problems and migration of young and well-educated people. Long-term unemployment strikes especially middle-aged and less educated peo-ple. Due to the low population density, the local markets for private services are very narrow.

The Objective 6 area also experiences major constraints due to the remoteness from main marketplaces, not only in relation to southern parts of Finland but also internally. The lack of entrepreneu-rial tradition and poor availability of business support services hinder the start-up of new compa-nies. Alarmingly, the number of jobs in primary production and in public services is decreasing.Furthermore, the level of networking is limited in the Objective 6 area constituting a hindrance foreffective regional development work.

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2. METHODOLOGY

Data collection and analysis methodsThe methodology of this evaluation exercise consisted of, on the one hand, desk studies of the Ob-jective 6 programme documents supplemented with other relevant literature, and on the other hand,both quantitative and qualitative analysis of the material gathered via statistics as well as databasesand interviews. In brief, the main data sources for this evaluation operation comprised:• Quantitative data acquired from the Objective 6 programmes' administration, i.e. the national

databases;• Quantitative data acquired from national statistics;• Quantitative and qualitative data acquired from interviews of key informants at regional and na-

tional level.• Literature related to the topic.

Firstly, relevant background information and documents such as Single Programming Documents(from here onwards referred as SPDs), ex-ante and interim evaluations of the Objective 6 pro-grammes, the Economic and Social Cohesion Reports of the Commission and other strategy docu-ments and literature related to the topic were reviewed and scrutinised. Secondly, quantitative datawas gathered from four types of data sets, the quality of which will be discussed further below.Thirdly, personal interviews were held with key informants. These interviewees were selectedamong the stakeholders – various individuals and organisations – who were directly and indirectlyaffected by the implementation and results of the Objective 6 programme in both countries and whowere likely to have an interest in its evaluation. The interviewees were granted anonymity. This listof stakeholders interviewed can be summarised as follows:• Policy-makers and decision-makers at ministry level (9 personal interviews);• Programme managers and administrators both at ministry and regional levels (14 interviews);• Project leaders in the Objective 6 Regions (30 telephone interviews);• Other individuals and groups with a legitimate interest in the programme (7 telephone inter-

views).

Fourthly, a group of project leaders was interviewed via telephone in both countries. Representa-tives of this group were randomly chosen using stratified sampling. The group was thus fairly pro-portional to the projects under each priority and also to the regional distribution of projects. Topicsaddressed in the interviews covered various aspects of the project implementation including the ef-fects and impacts of the programme, views on the overall programme administration and efficiencyand views on how the project in question had benefited society.

Special attention was paid to identifying the most appropriate interviewees at ministry-level. Allministry officials interviewed had played a central role in the administration of the Objective 6 Pro-gramme. Many of them were also to a large extent responsible for the programming and the launchof the programme. They were granted anonymity in the course of the interviews. Therefore, theiridentity or any other details indicating their present or former positions in ministries cannot be re-vealed.

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The data gathered was analysed by applying both quantitative data analysis methods and a qualita-tive approach. In detail, the tasks of this evaluation exercise were divided into the following sixspecific assignments:1. Relevance of the strategy and programming choices;2. Effectiveness and financial allocation analysis;3. Impact and efficiency analysis;4. Analysis of the delivery and implementation systems;5. Community value-added;6. Lessons for the future.

Under each assignment different combinations of interview material, programme statistics and pub-lic statistics were used. Although the interviews were aimed at different problem areas data gainedfrom all interviews provided insights into the analysis of all six assignments. However, assignment6 “Lessons for the future” was built on the ad-hoc analysis of assignments 1–5, and hence it aimedto provide insights into successes and failures experienced in the planning and implementation ofthe programme.

Problems encountered with the reliability of the national databases for programme monitor-ingThe reliability of the national databases built for the specific purpose of collecting data on projectswithin Objective 6 programmes caused a huge concern for this evaluation exercise both in Swedenand in Finland. In the course of this evaluation exercise, the evaluators had access to these databasesin order to perform certain analyses. However, the evaluation showed that the databases are not –even yet – fully operative1.

The introduction of data into the system has been delayed. This situation appears to have beencaused by the severely understaffed secretariats, insufficient instructions from ministries responsi-ble for data gathering and questions of prioritisation. In brief, there has not been enough time andenergy for recording the monitoring data into the databases in the course of the programme imple-mentation.

The monitoring data of the Objective 6 Programmes is stored in several locations, which causedconstraints for this evaluation exercise. While the financial part of the data collection and storage isskilfully performed, the data on indicators for each project seems unreliable. The important indica-tors, such as new jobs created or jobs maintained, are completely unreliable in many cases. The in-dicators relating to jobs were not defined in the same way throughout the programme and hence thisdata is open to various interpretations. Data on indicators allowing analysis of the effects of theprogramme is therefore not readily available. To collect accurate and reliable data on the importantindicators it is necessary to gather the data directly from the project leaders.

1 In the interim evaluation report for Finland it was stated that the national database – the so-called Fimos database –was not yet operative.

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Figure 3. The key evaluation concepts.

Overview of the key evaluation concepts and issuesFor the purpose of reader-friendliness, a brief overview of the key evaluation concepts and issues isprovided below. In the course of this evaluation exercise, the following key evaluation issues wereaddressed and interpreted as follows:• Relevance – to what extent are the programme’s objectives pertinent in relation to the evolving

needs and priorities at regional, national and EU levels?• Effectiveness – how far have the programme’s activities contributed to achieving its objectives?• Impacts – what are the effects on society brought about by the programme? Furthermore, the

impacts were considered at two levels (Figure 3):• The initial impacts of the programme (results);• The longer-term socio-economic impacts of the programme (outcomes).• Efficiency – how well, economically, have the various inputs been converted into outputs, re-

sults and outcomes?

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3. RELEVANCE OF THE STRATEGY AND PROGRAMMING CHOICES

3.1. Regional analysis of the programming area

The Objective 6 Region in Finland suffers many relative disadvantages compared with the otherparts of the country as discussed earlier. Above all, structural changes in agriculture and forestryhave caused new problems in recent years. These traditional forms of employment have diminishedin other parts of the country, but in the Objective 6 Region there has not been sufficient growth inindustry or private services to improve alternative employment opportunities. Due to the economicrecession in the first half of the 1990s, public services also started to employ fewer people than ear-lier. The government and municipalities started cutting expenses wherever possible. These complexproblems of the Objective 6 Programme Region received a lot of attention at the ex-ante evaluationstage.

Due to these circumstances new problems started to affect the economic situation in the Objective 6Region. Out-migration increased, unfavourable changes in the population structure occurred sincemost people leaving the area were young adults, the unemployment rate become extremely high(Figure 4) and long-term unemployment started causing severe social problems.

Figure 4. Unemployment rates in Finland and the Objective 6 Region 1989-2001.

These official figures concerning unemployment describe open unemployment. It must be remem-bered that Finland had started massive adult education and employment measures to fight the prob-lems of unemployment and its consequences. Thousands of people in the Objective 6 Region par-ticipated in these projects in the 1990s. If these persons had been included in the official unem-ployment figures, the unemployment rate would have shown figures several percentage pointshigher. This was, however, the situation in the whole country, not only in the Objective 6 Region.

The unemployment rate in Finland started to fall in 1995. It has fallen gradually until mid-2002. Inthe Objective 6 Region the fall in unemployment has been slower despite the fact that the area haslost some of its working force over the same time. Generally, the unemployment rate of the Objec-tive 6 Region does not follow national figures since a larger share of the population work as farm-ers. Therefore, the unemployment rate does not rise as drastically as in southern Finland during re-

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cession periods. Nevertheless, the decrease in unemployment is slower in the Objective 6 Regionduring the high conjuncture in comparison with other parts of the country. During the programmeperiod under review, the unemployment rate of the Objective 6 Region grew even more rapidly thanin southern Finland. Nowadays the rate is diminishing but remarkably slowly. Hence, the vaststructural changes of the Finnish economy in the 1990s seem to have worsened the situation in theObjective 6 Region.

By the beginning of the Objective 6 Programme in Finland, maintaining the level of population inthe Objective 6 Region already seemed difficult (Figure 5). Death rates had exceeded birth rates andout-migration increased. The level of population continued to fall after a temporary rise at the be-ginning of the 1990s. Since the out-migration concerns mostly young adults, problems were ex-pected to get even worse in the long run.

Figure 5. Population changes 1980 – 2000 indexed (1=1980) in Finland and the Ob-jective 6 Region.

The Objective 6 Region has higher unemployment rates than Finland on average and the recessionmade this situation even worse than before (Figures 3 and 4). The Objective 6 Region is losing itsactive (18–64 years) population to other areas of the country. Despite this out-migration of the la-bour force, the difference in unemployment rate in the Objective 6 Region and the country as awhole is growing. This gives evidence of the trend where the development in job creation in theObjective 6 Region has been extremely poor in recent years. This is a serious problem where anarea losing its vitality usually encounters new successive drawbacks. Due to the multiplier effect,this kind of vicious circle usually strengthens itself if it is not stopped by effective means.

Under these circumstances it was obvious that to tackle the problems certain measures needed to betaken. A fall in jobs in all main sources of employment, rising numbers of social problems and im-minent changes in the population structure clearly indicated that people in the Objective 6 Regionneeded new opportunities. If new forms of employment were not found within private services andindustry, the vicious circle of high unemployment, economic and social problems and out-migrationcould not be stopped. This was not an easy task in the Objective 6 Region where the level of educa-tion was below the average in Finland (Figure 6), the population was ageing and out-migration wasreducing the human resource potential necessary for economical growth. The situation deteriorateddue to a lack of entrepreneurial tradition, low population density problematic for private servicesand the lack of expertise needed to create jobs in branches of new technologies.

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Figure 6. Percentage of people with at least upper secondary education 1980 – 2000in Finland and the Objective 6 Region.

3.2. Overview of the strategic planning process and the programme structure

The SPD for Finland was created in cooperation with eight different ministries and regional coun-cils from all regions participating in the Objective 6 Programme. The responsible partner in thisprocess was the Ministry of the Interior, which was in direct contact with the European Commission(Figure 7). Therefore, the Ministry of the Interior represented the agent with the best possibilities ofinfluencing the contents of the SPD.

The leading role of the Ministry of the Interior was accepted in most other ministries of Finland.The process of compiling the SPD resulted, nevertheless, in some disagreements in prioritising theresources allocated to the programme. Different sectors of the ministry-level administration had dif-ferent ideas about the most important goals for the development of the Objective 6 Region.

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Figure 7. Structure of the cooperation in the planning process of the Single ProgrammingDocument (SPD) for the Objective 6 Programme.

Some interviewed in the evaluation criticised the European Commission in two areas: for importingthe so-called “Rural Development Package” to such a large extent into the SPD against some na-tional actors’ will and for requiring quantitative objectives for the whole programme. The argu-ments for the latter were later understood, but the process of setting them was too hasty; one of theinterviewees at the ministry level thought that these objectives were set in an over-optimistic way.He considered this would have been mostly due to national actors´ high expectations, not the Com-mission’s requirements or the authorities´ intentional will to exaggerate the expected results. Theseriousness of the problems in the Objective 6 regions was not completely understood in this phase.

The planning process for the SPD differed significantly from the previous procedures followed,which were familiar to the administration in Finland. Cooperation between many different minis-tries and also regional councils, which had just recently been formed, meant a completely new ap-proach for the Finnish administration. The ambiguous role of the regional councils, together withthe lack of tradition of inter-ministry cooperation in regional planning, caused some uncertainty andeven minor disagreements during the planning process. It therefore took some time before the coop-eration processes started to work properly.

In the final version of the SPD only a few regional aspects were highlighted. However, the SPD leftenough scope for regional interpretations, and also for the local aspects of regional development tobe taken into consideration when implementing the programme at regional levels. Nevertheless, theMinistry of the Interior was to some extent criticised for the lack of cooperative procedures and forthe inability to give advice to organisations responsible for the programme implementation in theObjective 6 Region. On the other hand, the actions of the Ministry were also understood: tightschedules together with completely new working procedures caused unexpected problems. This waspartly due to the inexperience of the partners involved in the SPD process. The administration has

Ministry ofthe InteriorCoordination andcontacts with the

Commission

European Com-mission

Other ministriesIn their fields of expertise:

- Trade and Industry- Labour

- Agriculture and Forestry- Education

- Social Affairs and Health- Transport and Comm.

- Environment

Regional Councils- Lapland

- North Ostrobothnia- South Savo

-North Karelia-North Savo

-Central Finland-Kainuu

-Central Ostrobothnia

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learnt a lot during the process, and according to the interviewees, the planning and cooperation pro-cedures have improved significantly since the beginning of the programme period in 1995. The ef-fectiveness and also the outcomes of the planning processes have been considerably better and ofhigher quality during the successor programme period of 2000–06.

The SPD for Finland was built to fight problems of unemployment, out-migration and the lack ofexpertise and entrepreneurial tradition. The fundamental idea of the Objective 6 Programme was tocreate new businesses in private services, to support new companies using or producing new tech-nologies and to encourage farms to diversify their production and activities in the direction of, forexample, rural tourism. The objective was also to open up new avenues for development in order tocreate growth, jobs and welfare and through these means to fight problems of unemployment, socialexclusion and out-migration.

The SPD of the Objective 6 Programme for Finland was divided into three priorities, which were(Table 1):

• Priority 1. Business Development and Company Competitiveness;• Priority 2. Development of Human Resources and Expertise;• Priority 3. Agriculture, Forestry, Fisheries, Rural Development and the Environment.

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Table 1. Structure of the Objective 6 Programme in Finland – priorities, measures and funding allocations.

Priority 1. Business development and company competitiveness

Total 513.4 meuroPublic 307.4 meuro

1.1 The creation of new business activity to develop and diversify theareas economic structure

1.2 Development and investment by existing companies and by busi-nesses newly locating in the area

1.3 Improvement in operating environment for business1.4 Promoting the establishment of companies and entrepreneurship1.5 Personnel development to underpin the competitiveness of SMEs in

key sectors and support investment1.6 Development of telecommunications network services1.7 Encouraging the use of bioenergy and other renewable sources of

energy and development of energy infrastructure and networksPriority 2. Development of human resources and expertise


2.1 Investments in higher education and training establishments andR&D activities required to develop expertise

2.2 Research, technology and training supporting development of keysectors

2.3 Development of cooperation and networking to promote expertise2.4 Pathways to employment and prevention of exclusion2.5 Integration of young people into the labour market2.6 Vocational training and retraining, guidance and advice2.7 Anticipation of changes in labour markets and development of ex-

pertise systems2.8 Human resources action aimed at the development of the information

society and distance workingPriority 3. Agriculture, forestry, fisheries, rural development and the environment


3.1 Improvement of the efficiency of agriculture: Investment aid to agri-cultural holdings and back-up measures to assist agricultural hold-ings

3.2 Establishment aid for young farmers3.3 Compensatory allowances for mountain and hill farming in less

favoured areas3.4 Development of processing and marketing of agricultural products3.5 Establishing producer groups for agricultural and horticultural

products3.6 Training to encourage structural adjustment in agriculture3.7 Development of the structure of the fisheries sector3.8 Rural development package – ERDF3.9 Rural development package – ESF3.10 Rural development package – EAGGF3.11 Management and protection of the environment

Priority 4. Technical Assistance



All priorities

In addition to these priorities, the programme included the fourth priority concentrating on technicalassistance for programme implementation. However, due to its technical nature, this fourth priorityis only briefly reviewed in this report.

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3.3. Assessment of the relevance of the strategy and programming choices

In this section, the basic principles of the Objective 6 Programme for Finland 1995–1999 are dis-cussed. The principles are compared, on the one hand, with the Community Objectives of the mid-1990s as presented in the White Paper on Employment, Growth and Competitiveness (1994), andon the other hand, with the actual circumstances in the Objective 6 Region (Figure 8). This analysisaims to assess the validity of the strategies and programming choices of the Objective 6 Programmein the European context and especially for the needs of the area in question. If the SPD is proved tobe in line with these aspects, it is more likely to having succeeded in reaching its targets. The mainsources of information for this analysis constituted the SPD for the Objective 6 Programme andother programme documents, publications of the European Commission, Finnish national statisticsand personal interviews of key informants at national and regional level.

Figure 8. Method for conducting the analysis of the relevance of the strategy and programmingchoices.

To begin with, employment was considered the most important issue in the SPD for Finland (seeTable 2 on page 27). All other objectives can be seen as sub-targets to this fundamental objective.In the mid-1990s this target setting was well grounded. Due to the economic recession, unemploy-ment rates had risen dramatically all over Europe. Therefore, the same matters were focused on inEuropean discussions and objective settings, for example, in the European Commission's White Pa-per on Growth, Competitiveness and Employment. In the Objective 6 Region, the problem of un-employment was predominantly high compared with the situation in Europe or other parts of Fin-land. Despite the public measures for training and employment, the level of unemployed people ex-ceeded 20 % of the labour force in 1994.

3.3.1. Priority 1 Business Development and Company Competitiveness

Priority 1 Business development and company competitiveness was built on various themes. Thepriority included elements of new technologies (development and transfer), business services, net-working, information society and equal opportunities, which were designed to improve companies’competitiveness. It was hoped that increased competitiveness would increase a company's ability toemploy new personnel so creating jobs. The most important target group was small and mediumsized enterprises (SMEs), which were expected to have the largest potential to employ people.

New technologies as a rapidly rising business activity in Finland were expected to create jobs in theObjective 6 Region as efficiently as they had in other parts of the country. It was also seen that itwould be important for the whole population in the area to be introduced to the on-going techno-logical development. The lack of existing expertise made it somewhat difficult, however. Never-theless, the cooperation with different universities helped to solve the problem.

CommunityObjectives

Objective 6Programme

Circumstancesin the Objec-tive 6 Region analysisanalysis

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Diversification of the economy as a whole was a necessary objective in the programme region. Forinstance, the number of farms with low income or close to bankruptcy was high, as well as the un-employment rate in general. The structural change of the economy had resulted in the disappearanceof many former occupations, and many skills needed before had become either partly or completelyunnecessary. In these circumstances new skills had to be found and new businesses had to be set up.In the Objective 6 Region this also meant changing the attitudes towards entrepreneurship – therewas a need to launch the development towards new and more entrepreneurial culture among thepopulation.

A weak tradition of entrepreneurship, together with a low population density, had led to there beingonly a small number of companies in the Objective 6 Region. Because of this, the supply of busi-ness services was also weak and networking between companies was not active. In order to improvethese locally important matters, the Objective 6 Programme had its own sub-measures within Prior-ity 1. The aims and objectives of this kind of development are also in line with the Community'sprinciples of business development.

In the SPD, meeting the Community Priority of Equal Opportunities was mostly emphasised in Pri-ority 1. This meant giving special attention to certain groups of people: youth, women and ageingmen who had lost their jobs with the disappearance of some traditional livelihoods (e.g. in forestryand farming). Women and the younger generation were seen as key groups in keeping the area ac-tive. Elderly men were feared to suffer from social problems. According to interviewees, these werethe right target groups for this type of measure.

3.3.2. Priority 2 Development of Human Resources and Expertise

Priority 2 Development of Human Resources and Expertise included themes of research, trainingand education as well as technology transfer, opportunities from information society and exploita-tion of research assets. The overall theme of the priority was combating unemployment.

The priority paid special attention to the anticipation of structural changes in the labour market. Itstarget groups were people who are threatened by the risks of long-term unemployment and social

The ”Design Park” project was launched in the Lapland Region to promote in-teraction between universities, polytechnics and industry. It aimed to promoteentrepreneurship and experiment with new types of cooperation. The basic ideawas to optimise the synergy benefits between the research sector, educationalunits and private businesses. The participating companies gained resources forapplied research and education as well as counselling. They also benefited frompossibilities for using the necessary equipment at the educational units. Thevalue-added of the project for the educational units was the direct contact withthe markets – they were “closer to their clients” and therefore more capable ofdeveloping their research and education processes. The results of the projectwere very satisfying: more than ten new businesses were started and the existingcompanies had better possibilities for development actions. The project was wellanchored on local resources and opportunities. It increased the level of exper-tise and created new forms of local cooperation.

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exclusion. These people form a large group among the unemployed due to a rapid structural changein the Finnish labour market and the low number of jobs available. In the Objective 6 Region therisk of social exclusion is somewhat higher than in other regions.

To improve the opportunities for employment in the Objective 6 Region, education, counselling andactivities to improve technology transfer and dissemination and application of new technology rele-vant to needs in the region were targeted. Within these activities special target groups were women,young people and the long-term unemployed.

This priority had some regional differences in its focus to fit the local circumstances and the specialneeds of each region. This meant, for example, concentrating on existing types of production andstrengthening the expertise in those areas. Each region emphasised their strong lines of productionor expertise: on the one hand food, forestry, plastics, metal or stone industries, and on the otherhand, expertise in environment, space, data networks or information technology.

Improving competitiveness of the companies located in the Objective 6 Region was also an impor-tant aim of Priority 2. The lack of skills and expertise of companies’ personnel was undoubtedly areal problem in the area, hindering the birth of new companies and the growth of existing ones.Thus, Priority 2 aimed to improve the competency of company staff and was regarded as one of thebest methods to promote company competitiveness in the long run.

As an outcome of an analysis assessing the relevance of the strategy and programming choiceswithin the Priority 2, it can be stated that the measures chosen for Priority 2 are well in line withboth the Community Objectives and the local circumstances in the Objective 6 Region. Also ac-cording to the personal interviews of the authorities at both regional and national level, the targetswere set in a professional manner.

3.3.3. Priority 3 Agriculture, Forestry, Fisheries, Rural Development and the Envi-ronment

Agriculture and other forms of primary production struggled with problems due to low productivityand insufficient income in the Objective 6 Region. Many farms had already been run down andmany others were facing severe problems. In these circumstances, where other livelihoods did notoffer job opportunities, it was necessary to improve the efficiency and the profitability of the pri-mary production sector. The main target groups of the measures within Priority 3 were farmers,fishermen and other people earning their income in the primary production sector. Predominantlythis priority was targeted to support farming and forestry. Possibilities to support fishing werescarce since the Objective 6 Region has a limited coastline. Therefore, the funding for fisheries wasalso quite limited, only 0.7 % of the total financial framework. In addition to these target groups,other people living in the Objective 6 Region had a possibility to participate in the measures imple-menting this so-called “rural development package”.

Priority 3 included some rather traditional ways of increasing producers’ incomes. For example, themeasures 3.1–3.5 (see Annex 1) were similar to those of the Objective 5a Programme and the larg-est of them in terms of funds allocated concerned compensatory allowances for farming in less fa-voured areas. The idea of these compensatory allowances was to maintain farm incomes and thefarming population in this very difficult area.

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Measures for increasing the income level of primary production were concentrated on improvingthe efficiency and diversification of the production, for example by supporting training and invest-ments in the sector and creating micro-businesses to be run alongside farming. The efficiency offarming was also to be improved by creating new forms of co-operation. An example of this hasbeen the emergence of the so-called producer groups that were started in order to cut farming ex-penses. Micro-businesses were envisaged to include, for example, part time tourist services andother diversified rural activities to earn an extra income. Hence, the diversification of rural liveli-hoods was set as one of the ultimate objectives within this type of measure.

In addition to the support to agriculture and food production, the programme contained a compre-hensive “rural development package” that was funded by all three major Funds: EAGGF, ERDFand ESF. The objective of the rural development package was to create a wide range of actions inorder to encourage the diversification of agricultural production.

Environmental issues were integrated in this priority. However, environmental issues and the needto seek sustainable development were not stressed as much as would probably be required today.Nevertheless, it can be stated that considering the common circumstances and discussions at thetime of the programme launch in 1995, the environmental viewpoints were addressed sufficiently inthe SPD – the topic had its own measure and it was also mainstreamed into several other measures.

In summary, the objective for Priority 3 was to encourage the people living in the Objective 6 Re-gion to stay in the area by offering them better possibilities for life. Priority 3 seems to be welladapted to local circumstances, as well as reflecting elements of the Community objectives in themid-1990s. In order to encourage new businesses to evolve and increase income levels in the pri-mary production sector, it was necessary to launch new types of actions.

3.3.4. Key findings

In conclusion, according to statistical information and interviewees representing national and re-gional authorities, the SPD for Finland was very well in line with the actual needs of the Objective6 Region in the mid-1990s. The same objectives had also been set in reports at a Community level.

Furthermore, the strategic choices were acceptable when compared with both regional circum-stances and Community priorities of that time. Despite the minor problems during the planning pro-cess of the SPD, the strategies elaborated and the programming choices made in the Objective 6Programme had good possibilities to improve the employment situation and the quality of life in

The ”Metka-kakkonen” project was launched in the North Karelia Region toimprove the usage of wood in energy production, especially that of the wastematerial produced by the forestry industry. The majority of the project partici-pants were agricultural holdings. The idea was to increase local energy produc-tion in order to diminish the amount of energy imported from the area outsideand to create jobs in the area. The project was well grounded on local re-sources: both the materials and the labour force were local. By improving farm-ers’ own energy production capacity, the participants were able to diminishtheir need for purchasing energy from outside a farm. Therefore, they were ableto cut the expenses and to improve their competitiveness.

26

northern and eastern parts of Finland. In effect, the SPD gave the authorities in the region a reason-able scope for necessary actions to support regional development in the programme area.

The matter which had not been taken fully into account – which in fact was not known widelyenough in the process of drafting the SPD – concerned the changes which emerged in public fund-ing in the Objective 6 Region. The national budget savings hit these less developed areas, where thepublic sector was the most important employer in many municipalities, extremely hard. In addition,the spatial retargeting of national funds for business development reduced the amount of fundingavailable to support these regions. These changes were originally made to combat the extremelyhigh national unemployment rate as effectively as possible. The idea at national level was to boostthe creation of jobs wherever it was possible, not only in the less developed areas. From this per-spective, the Objective 6 Programme was received most positively in Finland since it stayed fo-cused on the problem areas with particularly high unemployment rate during this difficult time ofretargeting the national funds.

27

Table 2. Comparison of the SPD of the Objective 6 Programme with the Community Objectives and circum-stances in the Objective 6 Region in the mid-1990s. Based on desk study and personal interviews ofkey informants from national and regional authorities (8 experts interviewed at ministry level and 10experts at regional level).

Basic elements byPriorities of theSPD

Single Program-ming Document(FIN)

Community Ob-jectives(1994-95)

Circumstances inthe Objective 6Area in 1994

Unemployment Seen as the most importantproblem in Finland

Most important problem atthe Community level

Unemployment rates over20 % in 1993-95.

Priority 1. Business Development and Company CompetitivenessGrowth by improvingcompetitiveness

The most important way toreduce unemployment

The most important way toreduce unemployment

Jobs lost in agriculture,forestry and public services.

New technologies, infor-mation technologies

Utilisation, transfer anddevelopment playing animportant role; goal: infor-mation society

Utilisation, transfer anddevelopment playing animportant role; goal: infor-mation society

Growth based on new tech-nologies: traditional formsof employment are reduc-ing.

Diversification of theEconomy (education)

Small local businesses andindustrial clusters exploit-ing local business opportu-nities.

Encouraging small busi-nesses was seen as an im-portant way of affectingunemployment.

Weak tradition of entrepre-neurship; changing attitudesand increasing knowledge.

Business support servicesand networking

Targeted for SMEs. Neces-sary to improve competi-tiveness.

Transfer of technology andinformation were foundimportant.

Lack of expertise in thearea required new forms ofservices.

Equal opportunities Special attention to oppor-tunities for women andyouth; also men over age of50 problematic.

“Equal opportunities” wasone of the main principlesof the Commission.

Young people and womenwere seen as vital for futuredevelopment

Priority 2. Development of Human Resources and ExpertiseResearch and training +transfer of technology

Lack of expertise requiresimproving human resourcesand technologies.

It was found to be neces-sary to improve competi-tiveness at the Europeanlevel.

Structural changes in theeconomy require new skillsand technologies.

Education and develop-ment

Education, counselling anddevelopment play a majorrole.

Improving human resourcesrequires education.

Lack of entrepreneurialtradition and a decline inagriculture require newskills

Improving the skills of theunemployed

Young long-term unem-ployed have a central role.

The youth were seen as oneof the most important targetgroups.

The risk of social exclusionis high especially amongthe youth.

Priority 3. Agriculture, Forestry, Fisheries, Rural Development and the EnvironmentSmall businesses andtraining for farmers

Diversification into ruraltourism etc. Micro-businesses to be run along-side farming.

Encouraging small busi-nesses was seen as an im-portant way of affectingunemployment.

New products had to bedeveloped to increase in-come level of the farms.

Improving efficiency Important goal; education,networks etc.

Improving efficiency andcompetitiveness is one ofthe main targets.

Small-scale farming hasbeen typical of the area inprevious years.

Environmental issues Taken into consideration,not too highly prioritised.

Taken into consideration,not highly prioritised

Must be taken into consid-eration due to vulnerablenature.

These national actions led to a situation where state intervention was decreasing at the same time asthe Community level intervention was increasing. The net change of this intervention targeted atregional development is extremely difficult to estimate since a large proportion of Finnish regionalpolicy support had been channelled to the Objective 6 Region in a variety of ways. For example

28

municipalities received state aid (as they still do, but in smaller amounts), the public sector hadlarger numbers of people employed, national support to RTD actions of companies was higher inthese peripheral areas than elsewhere. Some interviewees alleged that the net change in the flow ofpublic money into the Objective 6 Region did not constitute a significant change towards a moreenhanced regional policy support despite the millions of Finnish marks allocated to the implemen-tation of the Objective 6 Programme for Finland. In their opinion, the Finnish regional policy isnowadays implemented mostly through the Structural Funds of the European Union.

29

4. ANALYSIS OF THE DELIVERY AND IMPLEMENTATION SYSTEMS

4.1. Administrative structure of the programme and the start-up of the programmeimplementation

The funding of the Objective 6 Programme for Finland was first channelled through the FinnishMinistry of Finance, through which the four different Structural Funds were allocated to the minis-tries responsible for their management (Figure 9). The European Social Fund (ESF) was managedby the Ministry of Labour, the European Regional Development Fund (ERDF) by the Ministry ofthe Interior and the European Agricultural Guidance and Guarantee Fund (EAGGF) as well as theFinancial Instrument for Fisheries Guidance (FIFG) by the Ministry of Agriculture and Forestry.These funds were delivered further to altogether eight different ministries and in most cases to theirdistrict administration authorities who were in charge of the project selection. The decision-makingprocess is briefly described later in this chapter.

Figure 9. Administrative structure of the Objective 6 Programme. The delivery of funds from the StructuralFunds to the decision makers and project leaders.

The funding was also distributed to the four different priorities and more specifically split by themeasures (see Table 1 on page 21). The total number of these measures in the Objective 6 Pro-gramme for Finland was 26. Hence, the funds were divided, on the one hand, by the Finnish minis-tries, and on the other hand, by the measures of the Objective 6 Programme. This made the deci-sion-making process quite difficult; representatives of eight different ministries together with thereformed Regional Councils aimed to decide which types of measures should be of highest impor-tance and how the funds should be distributed. The goal was to form an 8 x 26 type matrix for thepurpose, a complicated task itself. This task became even more challenging due to the lack of tradi-tion of cooperation between the ministries and other parties.

According to one interviewee, the beginning of the Objective 6 Programme implementation waschaotic and no one really knew what their roles were. Many other interviewees supported this view.The main question was “who may decide how the money will be spent”. For example, some Re-

European Commission – Structural FundsMinistry of Finance Finland

ESF ERDF EAGGF FIFG

Ministry of Labour Ministry of the Inte-rior

Ministry of Agricultureand Forestry

Ministry ofLabour

Ministry ofTrade &Industry

Ministry ofAgriculture& Forestry

Ministryof theInterior

Ministry ofSocial Affairsand Health

Ministry ofEnviron-ment

Ministry of Trans-port & Communi-cation

Ministry ofEducation

District Administration Authorities

PROJECTS

30

gional Councils expected to receive lump sums of funds which they never received. Different min-istries also had different ideas of what were the most important issues in the regional developmentof the region concerned. In addition it was partly a question of safeguarding the rights for the powerof execution.

4.2. Strategic planning capacity of the management

Difficult startIn the creation of the administrative practises the worst problems were experienced at the start ofthe programme period due to a lack of existing co-operational practises and lack of particular ex-pertise. For instance, Finnish sectoral authorities were not familiar with inter-ministry cooperationin regional development. Furthermore, ministries were unaware of their exact roles or duties at thistime. The Objective 6 Programme implementation also involved new actors such as RegionalCouncils in the negotiations. Their role in the decision-making process was very unclear at thattime. Another group of problems emerged due to the unfamiliarity with European-level work. Fin-nish authorities were inexperienced not only with putting European procedures into practice butalso with programme-based work. These questions have been raised already in the ex-ante evalua-tion.

According to the interviewees, it took years before the whole Finnish administration learned theirtasks and the necessary administrative structures were created. Some instructions were modified aslate as 1997. Only after that time could the implementation of the Objective 6 Programme be re-garded as functioning properly and efficiently. From the ministries´ point of view, this delay waspartly due to the insufficient level of personnel resources in the ministries and partly due to theslowly adapted cooperation procedures with the Commission. However, the ministries are not di-rectly to blame for the situation. The budget squeeze of the government did not allow increasingpersonnel resources even when it was felt necessary.

Interviewees at the regional level revealed that the ministries did not have a sufficient level of re-sources to inform the regional authorities of what should be done and how it should be done withregard to programme implementation. In effect, the ministries provided the regional authorities withinadequate instructions. In addition to this, these instructions tended to change quite often. Thiscaused delays and uncertainty among regional level programme implementers; it was difficult forthe authorities to give advice to the public, when their own expertise was not sufficient and whenthe ministries were unable to assist them.

Learning by doingInadequate guidance led to changing instructions with many tasks having to be repeated severaltimes. This resulted in inefficiency in the programme implementation and caused extra work at alllevels – among ministries, regional level and project leaders. This was not such an issue towards theend of the programme period when growing experience, knowledge and staff resources gave theadministration a better possibility to complete their duties.

During the first two years of the Objective 6 Programme administration there was too little knowl-edge and too much work to be delivered for the number of people in the programme implementa-tion. However, when staff learned their duties at all levels of the administration the programme im-plementation process started to run more efficiently. These problems were also solved by the re-cruitment of new employees. Moreover, the project leaders learned how their type of projectsshould be led and they became aware of the procedures necessary for successful project manage-

31

ment. In conclusion, the beginning of the Objective 6 Programme era was a hard learning processfor all actors.

4.3. Execution of the project selection procedures

At the start of the Objective 6 Programme implementation there was an insufficient level of infor-mation concerning the programme’s objectives, structures, requirements and procedures at all levelsof administration. Gradually, the amount of information on the programme implementation proce-dures increased together with the number of approved projects.

One disappointment for the Finnish Objective 6 Programme’s administration was, despite the ex-pectations, that the number of applications submitted by local actors which met the quality criteriawas small. Furthermore, the scarcity of experienced project leaders was a major concern and re-sulted in a slow start for the programme.

The majority of project applications meeting the quality criteria and thus the threshold for approvalwere proposals submitted by various public organisations. Among these organisations the actorsrepresenting local authorities and other sub-regional units, universities, polytechnics and otherschools were dominant. According to the interviewees from regional authorities, their ability toproduce high-quality applications and also the competence to run projects successfully was signifi-cantly higher compared with actors representing the local level.

By the end of the programme period this development had led to the situation in which the applica-tions of the highest quality were submitted by professional project management organisations likedepartments of universities and polytechnics as well as private companies, due to their expertise andwell-functioning connections with the authorities. According to the interviewees, these profession-als also tended to be more reliable partners for the Objective 6 Programme administration comparedwith the diverse group of other type of local-level actors such as NGOs, village committees and soon. If these professional organisations were among the consortium for an approved project, in gen-eral, they managed the project, reported the results and took care of the bureaucracy in a satisfactoryway.

Another aspect that favoured the development of professional project management units in the pub-lic sector was the payment system of the Objective 6 Programme. Small private sector companies orindividual persons stand great risks if not paid within a reasonable period of time due to cash-flowproblems. Public sector project management units usually do not suffer from the problems of li-quidity and thus, are more stable in this sense. Their financial standing generally offers possibilitiesof taking risks in the form of delayed payments.

The structure of the decision-making process of the Objective 6 Programme can be regarded ascomplicated (Figure 10). However, according to the interviewees among regional authorities, inpractice this system was not necessarily as complicated as one may assume. Usually, the drafting ofthe project application was regarded as the most time consuming phase. In some cases the systemwas simplified by the practice where the authorities to whom applications were submitted repre-sented both the application administrators and the final decision-makers for project approval. There-fore, the very same authorities were able to guide project leaders whether their application would orwould not be approved, although formally this decision was taken by the Regional ManagementCommittees. However, this procedure varied among different authorities.

32

Figure 10. Decision-making process from the perspective of project leaders.

Many project leaders interviewed referred to the experiences gained from the project selection quitedifferently. According to one of them, “…despite the well-functioning guidance services, the draft-ing of application was a somewhat difficult process … the decision-making process of the projectselection was slow.” Thus, the views concerning the efficiency of the project selection are ratherambiguous. Some of the interviewees shared the view that the project selection was made within areasonable time scale. It can be concluded that the findings regarding this issue vary depending onthe region and the authority in question as well as the Structural Fund and the ministry in question.However, it must be highlighted that in the beginning of the programme implementation period thedecision-making process took somewhat longer than in recent years. This is another example of thelearning process that progressed as the administration gained experience.

The project guidance services of the regional authorities were mostly regarded as well functioning.In effect, a significant improvement was reported from the first years of the programme implemen-tation period. This was however inevitable and foreseen since the regional authorities – who werethemselves tackling the learning process – were not provided with a sufficient level of reliable in-formation from the ministry level. As discussed earlier, the first instructions received from the min-istries tended to be rather inaccurate and frequently changing in 1995–1997.

ApplicationsApplicants representing regional and local authorities, other sub-regional units, private sector companies, schools, universities and

others

TEKESNational

TechnologyAgency

Employment and EconomicDevelopment Centres

Departments of ”Rural Affairs”,”Employment” and ”Business”

RegionalCouncils

ProjectApplications

Guidance andpreliminaryprocedures

Approvalof the applica-

tions

Business AidWorking Group

Managing company-specific assi-stance applications

Regional Management Com-mittee

Various local and regional authoritiesand representatives of other parties

FinalDecision-Making

Employment and EconomicDevelopment Centres

Departments of ”Rural Affairs”,”Employment” and ”Business”

RegionalCouncils

TEKESNational

TechnologyAgency

MinistriesDistrict

administr.authorities

MinistriesDistrict

administr.authorities

33

4.4. Efficiency of the financial circuits

The bureaucratic procedures experienced in the Objective 6 Programme implementation causedvarious problems. The decision-making processes of the whole programme implementation systemsslowed down due to the newly introduced need for inter-ministry cooperation and also due to thedialogue with the Commission which required adequate personnel resources. One of the mostalarming problems was the introduction of a new type of payment system. The Commission’s pay-ment system was built upon the principle of the reimbursable action, that is the Commission trans-ferred the payments to the national authorities after approving the costs incurred. In practice, thetime period for the financial circuit varied between two to three years.

Since the Objective 6 Programme launch, the Finnish Ministry of Finance has tried to solve thisproblem by providing project leaders with payments covering the Commission’s share directly fromthe ministry’s own funding reserves. This means that the Ministry of Finance later recovers thisamount of funding back from the Commission. The procedure has caused some risks for the Minis-try of Finance: in the event that the Commission would not accept all costs and the Finnish govern-ment would lose the money it had used for this “loan” to the project leaders. There have been someallegations in the Finnish press that this procedure could be against the original guidelines of theCommission. This is however not a subject of this evaluation. If this procedure has made the finan-cial circuits function more rapidly, in the scope of this evaluation it can be regarded as effective forthe implementation of the programme.

In addition to the often long waiting periods for payments, problems were encountered with the bu-reaucracy of the payment system. The procedures differed from the practices the regional develop-ment actors had been accustomed to previously. This unfamiliarity led to various misunderstandingsand caused further delays in the payments. The late payments were mainly due to confusion but alsocarelessness of the project leaders in project documentation – the rest was due to the reimbursablepayment system.

One indisputable result of the problems experienced in the financial circuits has been the notion thatthe number of project applicants and leaders has diminished in recent years. At the same time theremaining ones are ever more highly qualified professionals. Usually, this also implies that the or-ganisations applying for and implementing projects are characterised by a higher number of staffand stability. As a consequence, the delivery and implementation of the Objective 6 Programme isbecoming a professionals´ business to an ever-higher extent, and thus, fewer local actors have realpossibilities to benefit from the programme.

4.5. Functioning of the partnership

Cooperation between different branches of the administration and other local actors in the RegionalManagement Committees was something quite new in the Finnish administration procedures in thebeginning of the Objective 6 Programme implementation. These Regional Management Commit-tees were the first inter-ministry organisations for regional development to function properly inFinland. The objectives and measures of the programme were discussed in these Committees, whichalso provided forums for decision-making on the most important goals for regional development.

The Regional Management Committees had representatives from various ministries and their dis-trict administrative authorities, regional and local authorities and other organisations. For the first

34

time all actors were able to discuss and plan future steps in regional planning together with otherauthorities in the region concerned. This cooperation has produced excellent results and opened upnew avenues for regional development.

This inter-administrative cooperation introduced as a part of the Objective 6 Programme imple-mentation in Finland must be regarded as one of the most significant and positive outcomes of thewhole programme implementation. This is the case at both national and regional levels. Open dis-cussions and common planning procedures between the key actors in regional development havemade the work more effective than earlier. Also the project leaders have received better guidance asthe authorities have become better aware of the main issues and the provision of services offered byother authorities.

However, some problems have arisen due to these new inter-administrative collaboration proce-dures which are felt strongly today. Although the cooperation has increased and the administrativeprocedures have been made as transparent as possible, there is a counter-effect in that the amount ofbureaucracy has grown. Nevertheless, nowadays, despite the longer decision-making processes, allinterviewees share the view that the advantages gained override the drawbacks. Currently, aspectsand main concerns of many different actors are taken into consideration in the regional developmentwork which raises opportunities to combine the limited resources and so increase efficiency. There-fore, regional policy implementation in Finland stands a greater chance to succeed in reaching itstargets. On the other hand, problems concerning this type of decision-making have also been re-ported. Some interviewees considered that the requirement to find consensus in the spirit of partner-ship sometimes kills good ideas before they can be tested.

4.6. Performance of the monitoring system and the quality control

The Monitoring CommitteeThe Monitoring Committee of the Objective 6 Programme consisted of about 30 members from dif-ferent ministries and other parts of the Finnish administration and NGO sector. The Commissionwas also represented. The Monitoring Committee had an advisory and monitoring role in the proc-ess of the programme implementation. It offered various organisations opportunities to be heard andalso to monitor the progress made in the Programme implementation. However, the MonitoringCommittee did not have any direct power for decision-making in the Objective 6 Programme.

According to the interviewees, when taking its first actions the Monitoring Committee was unawareof its duties. As with the other parts of the administration, the members of the Monitoring Commit-tee were participating in procedures they had not previously encountered and many had far too pas-sive roles in this new situation. For example, the labour market organisations could have taken amuch more active role in the work of the Committee. As in the other parts of the programme ad-ministration, the working procedures of the Monitoring Committee developed during the pro-gramme implementation period. Due to the purely advisory and monitoring role of the MonitoringCommittee, its actions were not seen to be of the highest importance. This also affected the intensityof the committee work.

Monitoring systemsOne of the most difficult problems encountered in the implementation of the Objective 6 Pro-gramme was the creation of a reliable system for gathering follow-up data. In particular, as me n-tioned in the ex-ante evaluation, the programme lacked the relevant indicators. Data should havebeen gathered from the beginning of programme implementation but the programme lacked the

35

methods for identifying and presenting relevant indicators. Each and every ministry produced in-formation of their actions first and foremost in the manner meeting their own needs and using theirown databases. Difficulties have been experienced when combining and using this information andstill exist despite the massive measures undertaken in order to combine the information from differ-ent sources in to one single database (Figure 11).

Additionally, the lack of programme level data has caused several problems. On the financial side,after years of programme implementation problems were faced when looking to what extent pro-gramme funds had been committed to projects and whether there were funds still available. Fur-thermore, these databases do not give possibilities for programme level monitoring of the resultsachieved.

It is quite astonishing that despite the new cooperative functions at all levels of the Finnish publicadministration, the ministries have not been able to create a well-functioning inter-ministry databasefor monitoring purposes including financial and qualitative data of the projects and the programme.It proved to be almost impossible to use the databases to receive an overall understanding of the de-velopment of the programme implementation. This problem concerns all those involved in the im-plementation of the Objective 6 Programme, including decision-makers. Lack of basic informationcomplicates the decision-making process. These problems concern the whole monitoring systemfrom the project level to the combination of the information from different sources into one nationaldatabase – the so-called “Fimos” database.

According to the interviews of project leaders, problems were experienced in producing reliabledata at the project level for two different reasons. Firstly, the original project objectives had oftenbeen set to an unrealistically high level. This had lead to a situation in which the project leaders hadthe temptation to inform the authorities of results that were to some extent over-optimistic. This re-sulted from the project leaders´ wish to show good project results. Secondly, it was often very diffi-cult to determine whether the employment of a person was due to the particular project in questionor not. The same person might have participated in several projects and in fact he or she might havebeen employed as a result of all of them, or even despite all of them. As a consequence, this mighthave led to a situation in which the same employment has been calculated many times for theachievements of different projects.

These problems discussed above are very human in their nature. A more technical one concernedthe timetable for the data collection during the Objective 6 Programme implementation. As a gen-eral rule, the results of the projects were expected to be provided as the project ended. At that time,it was almost impossible to estimate how many jobs had been saved or how many jobs or compa-nies had been created. On the one hand, the jobs saved might be lost within the next six months, andon the other hand, someone who wanted to start a business might have accomplished this a year af-ter the project had ended, still using the information gathered during the project.

36

Figure 11. Reasons for problems of reliability of monitoring data at different phases of project imple-mentation and monitoring.

Problems were also met in filing the information into the databases. Even if project leaders hadgiven the information on time, the authorities in different parts of the administration might haveused different procedures in the data processing, creating difficulties for the attempts to combine thedatabases of the ministries in a reliable way. In conclusion the reliability of the follow-up of theObjective 6 Programme implementation gathered by the ministries in Finland data is limited.

Many of the interviewees admitted that the results in the databases are to some extent unrealisticallyhigh. The project leaders estimated that the original project reports outline results that are 20 to 200percent higher than the actual results of the project. This figure is of course another estimationwhich cannot be relied on. However, it clearly shows the trend in which the actual results achieveddiffer from the information given to the authorities.

There are also other types of factors that cause failures in the monitoring system. One of them is thefact that the monitoring system records that if an unemployed person from the Objective 6 Region isemployed outside the area, he or she is reported as employed as an impact of the Objective 6 Pro-gramme. The original objective of the programme was to create jobs inside the programme area andnot to prepare the unemployed for out-migration, which has occurred in numerous cases. If this isthe case, the person might be able to improve his/her income which must be regarded as a great ef-fect for the person concerned. In this case the common objectives of the programme have beenpartly achieved, through reducing unemployment, but not in the case of out-migration.

Project Applications

Project Reports

District Administra-tion Authorities

Ministries

In many cases the project applicants are over-optimistic concerningjob-creation. Partly ignorance, partly intentional creation of too

high expectations.

Project leaders need to reach the targets. Leads to exaggerationand/or at least ”practical interpretations”. Reports are also written

too early when the results are not yet known.

Different administrative practises have leadto differences in the monitoring material.Problems also due to local interpretations.

Ministries have different databases.Databases are extremely difficult to combine.

Different practises create problems in interpretation.

Reporting pha-ses

Reasons for problems of reliability

37

5. EFFECTIVENESS AND FINANCIAL ALLOCATION ANALYSIS

The concept of effectiveness was defined in this evaluation as how far the programme’s activitieshave contributed to achieving its objectives. In this Chapter the effectiveness of the Objective 6Programme is assessed from the following perspectives:• The analysis of the financial allocation of the programme between priorities;• The evaluation of the effects of the programme activities on three central areas of the pro-

gramme – diversification of the regional economy and enhanced competitiveness, human re-source development and rural development.

5.1. Assessment of the financial allocation

The total financial commitments under the Objective 6 Programme were approximately 1 919 mil-lion euro for the whole programme and the programme period (Table 3). This sum illustrates thesituation at the end of 1999 when the programme was closed and new financial decisions were nolonger allowed. However, these figures illustrate the situation of commitments only at the adminis-trative level. It is quite likely that by that time some of the projects had not been finished asplanned. Therefore, the final funding allocations of the programme will apparently differ from thefigures discussed in this report. However, the difference should not be too noteworthy.

Table 3. Financial allocation of the Objective 6 Programme by frames and commitments by the end of year 1999.Currency = MEURO.

EU National Private TotalPriority 1 (5027 projects)Frame 165.31 165.31 228.84 559.47Commitments 175.14 206.61 560.40 942.15Frame achieved by (%) 105.9% 125.0% 244.9% 168.4%

Priority 2 (710 projects)Frame 99.63 99.63 55.58 254.84Commitments 101.87 107.54 42.22 251.63Frame achieved by (%) 102.2% 107.9% 76.0% 98.7%

Priority 3 (4869 projects)Frame 245.30 248.36 140.91 634.57Commitments 254.86 267.42 181.72 703.99Frame achieved by (%) 103.9% 107.7% 129.0% 110.9%

Priority 4 (Technical Assistance; 301 projects)Frame 10.45 10.45 0 20.91Commitments 10.50 10.49 0.35 21.33Frame achieved by (%) 100.4% 100.4% _ 102.0%

TotalFrame 520.70 523.76 425.33 1469.79Commitments 542.36 592.06 784.68 1919.10Frame achieved by (%) 104.2% 113.0% 184.5% 130.6%

38

The reason for somewhat inaccurate figures and for the uncertainty in the funding allocations of theObjective 6 Programme is the problems experienced with the monitoring system. Despite many at-tempts to solve the monitoring problems, there are still some questions pending. All ministries wererequested to finalise their project monitoring systems by the end of June 2002, especially the budgetsections, to meet the Commission’s deadline for payments. Regardless of serious attempts, theministry administration has clearly had severe problems in meeting this deadline.

As the figures reveal, the Objective 6 Programme exceeded its provisional framework set for finan-cial targets by 30 %. The spending of Structural Funds was exceeded by 4 %, the national publicexpenditure by 13 % and the private expenditure by nearly 85 %. This can be interpreted as a suc-cess: the programme has succeeded unexpectedly well in raising private financing for the projects,especially in within Priority 1 Business development and company competitiveness.

Some financial reallocations and other adjustments were conducted during the programme period.They comprised both transfers from one measure to another and between Structural Funds. Most ofthese changes were due to the fact that within certain measures the original frameworks for expen-diture were reached quite early in the programme period. Under other measures fewer projects werefunded than was expected at the time of the programme planning. The reallocation of the funds par-tially concerned, for example, the rural development package.

The financial figures of the Objective 6 Programme show that the funding was not used to its fullextent particularly under the measures aimed at the following areas – resources for training, findingnew sources of livelihood and creating new cooperative units in agriculture (3.2, 3.5, 3.6 and 3.9).The same problem occurred in relation to the actions targeted at the development of high technol-ogy and R&D activities under measures 1.6 (telecommunications network systems), 2.1 (invest-ments for higher education and R&D) and 2.8 (information society). Despite the fact that thesemeasures did not meet their objectives as planned, these funds were reallocated to those measureswhere the demand for development resources was higher (see Table 1 on page 21 for more detailedreview of measures).

One reason for the reallocation of funds in the Objective 6 Programme was the original and ex-tremely detailed budgetary plan. Each ministry had certain resources that were allocated to eachmeasure. As the original plans – inevitably – proved to be to some extent poorly estimated – it wasalmost impossible to reallocate resources from one ministry-specific and measure-specific sectionof this “matrix” to another. This led to a situation in which there was not funding available for highquality applications submitted. On the other hand, many examples were identified where ministry-and measure-specific funds could not be used due to a lack of project ideas. This problem wassolved with the reallocation of funds within the programme. These problems have been taken intoaccount in the design of the programmes of the current programme period 2000–06.

The funding sources of priorities differed significantly (Figure 12). For example, Priority 1 Busi-ness development and company competitiveness was to a large extent privately funded. Under thetwo other priorities the funding was clearly based on Structural Funds and national sources. Thesedifferences were due to different target settings of the priorities. Priority 1 included a number ofmeasures that were targeted at improving the competitiveness of private companies. Many of thoseprojects comprised company-specific investment aids and personnel training. Therefore, the fundingshare of the private sector was also quite high, often up to 70%.

39

Figure 12. Divisions of funding sources within each priority (meuro). Priority 4Technical assistance was almost fully financed by Structural Funds andnational government.

When divided by the administration of various funds the highest amounts of funds were adminis-trated by the ERDF and the EAGGF. The divisions of Structural Funds do not directly follow thepriority-based split. However, Priority 1 was mostly funded by the ERDF, Priority 2 by the ESF andPriority 3 by the EAGGF. Therefore, the figures illustrating the funding divisions by StructuralFunds and by priorities are very similar (Figures 12,13,14).

Figure 13. Financial commitments by Structural Funds in the Objective 6 Programme (meuro).

To a large extent, the funds administered by the EAGGF were planned to include measures targetedat improving the income level of farmers and thus these funds were not merely focused on regionaldevelopment actions. In some cases this caused problems as the funds were allocated to regions inrespect of numbers of inhabitants in each region. The problem occurred since farming has a much amore important role as a livelihood in the southernmost regions of the Objective 6 Region than inthe north. In some cases this led to a difficult situation: the EAGGF funds at the regional level wereadequate only for improving the income level of farmers, leaving no funds for regional develop-ment actions. This problem was solved in the course of the programme implementation by increas-ing funding shares in those areas where all the funds had already been allocated to farming aid.

40

The financial allocations under Priority 3 Agriculture, forestry, fisheries, rural development and theenvironment also encountered other problems were caused by different circumstances between theregions. For example, investment aids could not be used to the full extent due to the small size offarms in some regions. These farms were not able reach the required threshold investment needed toreceive co-funding from the EAGGF. Subsequently, in these regions farm investment actions werenot undertaken as the number of farms of sufficient size was low.

Another issue was the allocation of the funds under Priority 4 Technical Assistance. Originally, itwas not allowed to distribute these resources for any kind of administrative purposes. According tothe interviewees, the Commission had strictly regulated the use of these funds at the beginning ofthe programme period and so they were spent to a very limited extent. After negotiations betweenthe Commission and the Finnish ministries, possibilities for allocating these resources were wid-ened and the financial allocation of funds under Priority 4 was improved in the last two years of theprogramme period.

Figure 14. Financial commitments by funds and by priorities in the Objective 6 Programme(meuro).

The division of funds on the basis of the number of inhabitants to the regions operated quite welldespite the above-mentioned problems. After necessary adjustments it provided each region with asimilar amount of resources as for regional development work. Logically, the largest sums of fund-ing were allocated to the regions with largest numbers of population (Figure 15) being Lapland,Kainuu, North Karelia and South Savo. Central Ostrobothnia, North Ostrobothnia, Central Finlandand North Savo – where only minor parts of the regions fell under the Objective 6 Programme –received the smallest amounts of funding.

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Figure 15. Regional distribution of the financial resources in the Objective 6 Region(meuro).

Some interviewees stated that the problems faced in the Objective 6 Programme implementationwere not primarily caused by the problems of the financial allocation. More often problems evolvedfrom the lack of human resources – not only in the administrative systems but also among the proj-ect leaders. These problems were extremely difficult in those regions that only fell partly under theObjective 6 Region. These sub-regional units, as they are entitled in Finland, have very low num-bers of inhabitants. As they were “cut” out of their natural cooperation partners in order to includethem into the Objective 6 Programme, considerable difficulties were experienced when starting re-gional development projects. The institutions with adequate levels of human resources located out-side the Objective 6 Region had often limited interests in collaborating with these remoter regionalperipheries. However, exceptions to this rule could be identified. For example, the University ofOulu was – according to the interviewees – most active in capacity building projects in the region ofNorth Ostrobothnia, despite vast physical distances inside the region.

Regardless of some significant differences between the planned levels of and the realised levels offinancial commitments under the Objective 6 Programme and despite the problems experienced inallocating the resources in a most efficient way, the financial allocation systems worked relativelywell. Some problems and even mistakes were made in the financial allocation process but they weresolved appropriately with active measures. Therefore, problems related to financial allocation didnot seriously affect the execution of the Objective 6 Programme.

5.2. How did projects contribute to achieving the goals of the programme?

The ultimate aim of the Objective 6 Programme was to create stable circumstances for the successof both companies and people living in the area. This aim was to be achieved by improving the ex-isting assets in R&D, company competitiveness and natural resources located in the Objective 6Region. Economic growth was also gained by the diversification of the economy towards entrepre-neurship.

Results anticipated for these types of actions were an increased number of SMEs and jobs in theObjective 6 Region. Thus, the attractiveness of the region would be boosted and the standard ofliving of the population would rise. Following this positive development, the high levels of unem-

42

ployment, out-migration and social problems would reduce and the area could sustain its vitalityand prosperity.The original quantitative objectives for the Objective 6 Programme were as follows:

• To diminish the annual unemployment rate by 2.1% and by 8 000 people;• To increase the number of jobs in private services and industry to 135 000;• To diminish the gap in regional and national GNPs from 20 percentage points to 15;• To increase the number of jobs for women and youth.

Following the findings and recommendations of the interim evaluation of the programme, theMonitoring Committee removed the quantitative objectives concerning the GNP difference and un-employment at the end of 1997. The argument for this was that these numerical objectives – whichwere set at the phase of the programme design – were considered unrealistically high to achievewith the resources available (see chapter 3.2.).

The main focus of the programme was the promotion of employment in the Objective 6 Region.The means of combating unemployment caused by structural changes in the economy were basedon the following overall aims:

• Diversification of the economy and enhanced competitiveness;• Human resource development;• Rural development.

When aiming to achieve these objectives the integration of the Community Priorities – which com-prised at the time sustainable development, equal opportunities, RTD, information society and SMEdevelopment – was to be followed during implementation.

5.2.1. Diversification of the regional economy and enhanced competitiveness

Within the Objective 6 Programme, enhanced competitiveness was mostly addressed within Priority1 Business development and company competitiveness. The whole priority was targeted to increasethe number of new firms, to develop the actions of existing companies, to improve the expertise ofpersonnel and to promote entrepreneurship in general. The priority also included measures for im-proving network services as well as bio-energy and renewable sources of energy. These aims werepartly in parallel with the objectives for improving human resource development.

The concept of diversification of the regional economy includes both the creation of new firms andthe search for new sources of income in order to support, for example, diversification of rural liveli-hoods. Therefore, both Priorities 1 Business development and company competitiveness and 3 Ag-riculture, forestry, fisheries, rural development and the environment are focused in this section.

Priority 1 included a large number of measures and projects that were directed towards the increaseof company competitiveness by developing technical and professional competences of private com-panies. As discussed earlier in this report, these measures reached and even clearly exceeded theframeworks planned originally for the number of activities and also for the total financial allocation.In addition, the results were achieved with the support of a remarkably high share of private fund-ing. The figures clearly indicate that the attempts to reach the objectives of diversification of theregional economy and enhanced competitiveness were strong.Another question is the effectiveness of this type of development action. It was suggested that inmost cases investments and training programmes that now were run with co-funding from Struc-

43

tural Funds would have been started anyway. However, the situation is not this unambiguous. Theeffects of the public support are two-fold:

• Private companies are more confident, for example, in making investment decisions if theyreceive positive feedback from authorities who are local experts in investment questions.

• Public financing cuts the investment costs of companies and thus has a positive impact onthe profitability of an investment leading to the situation where more investments are profit-able (Figure 16).

Figure 16. Public support affects only a small part of the investment decisions.However they increase the number of investments made by cutting boththe risks and the expenses of development actions.

Even in such cases where the investments would have been undertaken without public support thispublic funding support might have triggered another action in a company. This “trigger impact” hasinevitably had positive effects on the competitiveness of companies – at least in the short-term.

With regard to Priority 3 Agriculture, forestry, fisheries, rural development and the environment, itclearly included elements of the diversification of the regional economy. Many of the farms startednew businesses in the fields of tourism and small-scale industry as well as wood or food processing.Some new businesses were more directly related to farming activities or at least they were deliveredby using the farm machinery. Also some private companies offering social services to the publicwere started on farms with the assistance from the Objective 6 Programme – examples of this arenursing homes for disabled and elderly.

As far as the farm-related businesses are concerned, the activities similar to those recognised amongother businesses (Figure 16) seem to have had a positive effect on the diversification of rural liveli-hoods and on enhancing the competitiveness of farms. Many projects included elements of subsi-dies, counselling and education and the participants were satisfied with the results. Although all ef-

No subsidies

Actionsstarted

Actionsrejected

30% subsidies

Actionsstarted

Actionsrejected

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fects are not yet observable, the attitudes of participants towards this type of rural development ac-tions are already very positive.

Nevertheless, a longer time period is needed to make any final judgements of positive effects of theObjective 6 Programme on the diversification of rural livelihoods or entrepreneurship in general inthe programme area. However, according to the interviewees, project participants were usuallycharacterised as having a high motivation to develop their businesses or to find new sources of in-come. Therefore, the Objective 6 Region possesses great chances in the future for increasing thelevel of new rural livelihoods and the establishment of new companies provided that the demand forproducts and services expands. One crucial precondition for this kind of development is the successin diminishing the out-migration and positive development in the tourism sector.

5.2.2. Human resource development

Human resource development had a significant role in the Objective 6 Programme. Priority 2 De-velopment of human resources and expertise was fully directed towards this objective, in additionlarge parts of Priorities 1 and 3 had similar elements. Human resource development was an over-riding theme through the whole programme. It was seen as one of the most important targets sinceimproving human resources can be seen a key factor in combating unemployment.

Priority 2 almost reached its financial targets, even if at times there were difficulties finding suitableprojects in certain measures, mainly concerning investments in universities and vocational institutes(measure 2.1). Also the objectives concerning numbers of participants, their employment and othertargets were reached.

Measures 1.4 Promoting the establishment of companies and entrepreneurship and 1.5 Personneldevelopment to underpin the competitiveness of SMEs in key sectors and support investment withinthe priority were aimed at raising the levels of education and expertise in order to support the de-velopment of private companies and also to create positive atmosphere towards entrepreneurship.These measures reached the quantitative objectives set.

Altogether 110 000 people participated in Priority 2 and measures 1.4 and 1.5. This figure is ex-tremely high in an area with a total population of 800 000. This clearly indicates that – despite thelower funding rate of Priority 2 compared with other priorities – measures related to human devel-opment reached a large number of people. Even if the same people attended these projects twice ormore these educational measures offered new possibilities to large groups of unemployed people aswell as new expertise to those improving their skills necessary in their present jobs.

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In conclusion, the measures for human resource development improved the skills of a vast numberof people. These educational projects must have been arranged in a structured way since the costs ofthese projects were rather low in comparison with the number of participants. A large part of theactions were also directed towards combating the unemployment of young people and the long-termunemployed. According to studies focusing on the ESF-funded educational projects, these types ofactions achieved quite good results. It has been reported that up to 50 % of all the participants willbe employed or start as a full-time student in educational institutions. Another result of these proj-ects has also been confirmed previously: the unemployed participants of educational projects areoften activated via these projects to search for new opportunities.

Generally, the aim of promoting human resource development was well in line with the needs of thearea. The participants were able to benefit from the actions taken within the priority, for example, inmany cases they were employed or engaged themselves with educational opportunities. It must,however, be noticed that these actions usually most affected those with a better education to startwith and had less effect on the average unemployed. Therefore, the probability of the better-educated person being employed is also somewhat higher than others in the unemployed population.

5.2.3. Rural development

Priority 3 Agriculture, forestry, fisheries, rural development and the environment was targeted to-wards the overall improvement of rural development. Its actions were based on sustaining farmingincome at an acceptable level (in terms of possibilities given the conditions in the least favouredareas), improving farmers´ capabilities of raising their productivity and finding new ways of earningan extra income to supplement the farming income. Therefore, Priority 3 was clearly the most im-portant priority in attempts to improve rural livelihoods.

Compared with the original objectives Priority 3 has achieved its targets more heterogeneously thanthe other priorities. Some measures have exceeded the original objectives set but other measureshave spent only 70–80% of their budgets and thus stayed far from reaching their quantitative tar-gets. For example, the establishment aid for young farmers has not been used to the extent it wasoriginally planned. Furthermore, problems have arisen as regards terms and conditions of aid tosmall farmers. Another measure identified with similar kind of problems is the measure 3.4, devel-opment of processing and marketing of agricultural products.In many cases problems were experienced with structural differences inside the Objective 6 Region.The SPD had not taken into consideration the full variety of circumstances in the rural areas con-

The objective of the ”Internetix” project was to create open learning environ-ments serving the educational and training needs of business life and schoolsand being unrestricted by schedules and distances in South Savo. The teachingmaterial was used in different schools, polytechnics and universities for variousneeds, for example for entrepreneurship training, computer studies and method-ology courses. The project was implemented in close cooperation with otherparallel projects. The project also improved the local level of expertise and hada positive effect on the level of education in many educational units. Theselearning services created by the project have also been transferred to other re-gions. The project has created a number of jobs based on expertise in the Ob-jective 6 region. It was implemented by a private company.

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cerned. In some parts of the Objective 6 Region the size of farms differ from the average, in someparts of the region actions of the programme did not respond to the problems or circumstances ofthe area. However, in the long-term these problems were solved through retargeting the funds or bymaking other adjustments.

The most widely used elements of the implementation of the rural development package in the Ob-jective 6 Region concerned the development of the productivity of farms, the search for newsources of income for farms, the promotion of rural tourism and the development of forestry orwood processing. In addition environmental issues were integrated in some of the projects. Fundswere also allocated to a large extent to secure the income level of farmers in the Objective 6 Re-gion. The latter measure was first and foremost a question of the income distribution. However, thisallocation to farmers had its macroeconomic affects since it increases the regional income sum andtherefore the total demand in local economies. Moreover, it partly decreases the levels of unem-ployment and out-migration. Although these are only short-term effects under these circumstancesthey must be considered as important as those activities which improve the income level predomi-nantly in the longer-term.

The target groups of rural development activities – such as farmers and owners of the rural SMEs –appear to be satisfied with the results of the projects they had participated in. This clearly indicatesthat there has been a demand for the kind of measures that have been carried out within the Objec-tive 6 Programme. According to one study conducted at the regional level the vast majority of par-ticipants targeted under these measures confirm that the benefit of the Objective 6 projects has evenbeen remarkable.

In conclusion, the actions taken to promote rural development were correctly targeted in the Objec-tive 6 Programme. In many cases it was a greater problem to find high-quality project ideas thanfunding for the projects proposed. On the other hand, the funds administrated by the EAGGF wereespecially criticised for too narrow an approach to problems. For example, if a project idea requiredvarious development tools and a cross-cutting approach to a problem under focus, the original proj-ect had to be split into several smaller projects in order to implement the project effectively. Thisrequirement increased the amount of paper work and made the development process more difficultfor the actors involved.

The ”Development project for marketing local food products of Lapland” im-proved the competitiveness of local food producers by enhancing the systems ofquality control, logistics and marketing. It also created cooperation with thelarger units of food industry in order to open up channels for these products towider markets. The project was implemented via a wide cooperation of differenttypes of units: educational units, municipalities and sub-regions, private compa-nies, parallel projects, producer groups, wholesale companies, NGOs and afood processing laboratory. It provided local actors with necessary contacts andinformation concerning a variety of significant issues of food production andmarketing.

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6. IMPACT AND EFFICIENCY ANALYSIS

In this evaluation exercise, the impacts were considered as having a dual scope:• The initial impact of the programme (results).• The longer-term socio-economic impacts of the programmes (outcomes).

Efficiency was defined as how well, economically, the various human and financial resources of theObjective 6 Programmes were converted into outputs, results and outcomes. Both the impacts andthe efficiency of the Objective 6 Programme are analysed in the following section.

6.1. Development of population

Depopulation has been a distinct feature of the Objective 6 Region for a long period of time. Struc-tural changes of the economy have reduced the number of jobs, especially in the primary productionsector. In the beginning of the 1990s the decrease in jobs focused rigidly on industrial sectors – thesame phenomenon occurred in public services in the second half of the decade.

Despite the regional development actions, the loss in net migration increased in the Objective 6 Re-gion in the second half of 1990s (Figure 17). This accelerating negative development was caused bya number of factors. Simultaneously, the rapid economic growth experienced in Finland offeredplenty of job opportunities outside the Objective 6 Region and the economic crisis of the state andmunicipalities within the Objective 6 Region cut down severely employment opportunities in thepublic sector. Since the public sector was the most important employer in the Objective 6 Region,many unemployed left the region in order to find jobs in other parts of the country. In these circum-stances private services did not have a chance to grow.

Figure 17. Number of inhabitants in Finland, in the Objective 6 Region and in the rural munici-palities of the Objective 6 Region 1980 – 2000.

The unfavourable development trend in both absolute and relative figures led to the ever-increasingout-migration from the Objective 6 Region to the areas of fast economic growth. The levels of thenet migration have been negative to the region for a long period of time. Since 1995 this develop-ment has even accelerated. In 1995 the region was losing its population at the annual rate of ap-proximately 0.6% and by the year 1999 this rate had grown to 1%. In the course of the programmeperiod and still today the out-migration hits first and foremost the rural municipalities in the pro-gramme area. A few urban centres in the Objective 6 Region have managed to sustain their levels ofpopulation whereas the remoter areas have not.

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Figure 18. Net migration in four major regions of the Objective 6 Region 1995-1999.

The continuing loss in the net migration (Figure 18) is affecting the vulnerable economies of nu-merous municipalities in the Objective 6 Region in an extremely unfavourable way. The areas suf-fering the most are located in the northernmost parts of the country. For example, the regions ofLapland and Kainuu have lost their population by an even faster rate than the Objective 6 Region ingeneral.

The population structure is becoming ever more distorted in the Objective 6 Region since the ma-jority of the out-migrants are young adults. The share of elderly is rising continuously in the pro-gramme area and this growth rate is clearly faster than in other parts of Finland (Figure 19).

According to statistical information, the Objective 6 Programme has not been able to combat out-migration. Nevertheless, it has certainly succeeded in slowing down the rate of out-migration in thearea. It seems, however, inevitable that the ever-growing losses in the net migration will continue.In brief, those factors that have accelerated the out-migration have been stronger than the measuresintroduced and resources allocated as a part of the Objective 6 Programme to combat this negativedevelopment. It must be emphasised that the resources referred to in this connection do not onlycomprise interventions of Structural Funds. One major reason for the failure of the Objective 6 Pro-gramme in the battle against depopulation is the fact that the level of expertise among the popula-tion to set up new companies and/or assist existing ones in growing branches has been insufficientto begin with.

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Figure 19. Share of elderly (over 64 years) in Finland, in the Objective 6 Region andin the Objective 6 rural municipalities.

In conclusion, although the Objective 6 Programme has managed to have an impact reducing theout-migration this impact has not been sufficiently strong. For example, many projects built uponeducation themes have enhanced the skills of participants, but since the number of job opportunitiesin the area has been limited many trained persons have left the area following their education. How-ever, this development should be regarded positively – education increases the expertise of the un-employed and opens up new opportunities for them and it is therefore important. In the long term itis possible that many of these people who have recently migrated may return. However, precondi-tions for this are genuine economic growth, rising income levels and increasing attractiveness of thearea.

6.2. Job creation and employment

In absolute figures the number of jobs in the Objective 6 Region had risen by approximately 13 000during the programme period. In relative figures, the same number amounts to 5 % between theyears 1993–2000. At the same time the growth in the number of jobs was close to 20 % at nationallevel (Figure 20). Despite all measures of the programme, the region has not reached the nationallevel in terms of employment. On the contrary, the gap in employment between the Objective 6 Re-gion and the country as a whole seems to widen at an accelerating rate.

The conditions for job creation and an increase in employment were rather complex in the Objec-tive 6 Region at the time of the programme launch. The falling income levels of the population dueto the public sector cutbacks had led to a situation in which the demand for private services was notgrowing. The emergence of new companies was difficult and the existing ones experienced a lackof growth caused by the lack of market demand. In these circumstances the number of new jobscould not increase and the scarcity of jobs forced the skilled labour to leave the area. The paradoxi-cal fact is that success in increasing only the supply of skilful labour does not lead to an increase inthe number of employed people. To a large extent, these problems were due to the financial crisis ofthe most important employer traditionally – the public sector.

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Figure 20. Unemployment development in Finland and in the Objective 6 region 1993 – 2000.The figures are indexed (1994 = 100).

The unemployment rate in the Objective 6 Region has fallen by 20 percent when compared with thefigures of the year 1994 (Figure 21). This could be regarded as an excellent result. However, whencompared with the decrease in the unemployment rate of the whole country (the rate has diminished46%), these figures demonstrate that from an unemployment perspective the Objective 6 Region istoday lagging behind even more than at the launch of the programme. One major cause has cer-tainly been out-migration: in the Objective 6 Region the number of unemployed fell by around 6500 in years 1995–1999 but the population loss was about 40 000 at the same time. This suggeststhat the positive development in the unemployment rate of the Objective 6 Region was to a largeextent due to increasing out-migration.

In conclusion, the measures of the Objective 6 Programme were in general well directed. The re-sources were, however, far too inadequate in order to boost the development in the area to the levelof the rest of the country. Various structural problems of the Finnish economy (for example thepublic sector squeeze in spending) prevented the Objective 6 Programme from achieving better re-sults. Nonetheless, the development in the area without the intervention of the Objective 6 Pro-gramme would have been far worse than it is nowadays. Inevitably, the region would suffer higherunemployment rates with fewer job opportunities and more severe social problems.

According to all the interviewees, the Objective 6 Programme was very valuable and indispensablefrom the viewpoint of promoting positive regional development in the region. It also had clearlypositive effects on employment and the creation of new firms. The problem now is how to estimatewith satisfactory accuracy the so-called “true results” of the Objective 6 Programme. According toone interviewee, this estimation would be a “totally impossible task” due to the lack of reliablemonitoring data.

If concluded on the basis of information recorded in Fimos – in the national official monitoringsystem – the Objective 6 Programme has achieved extremely good results. According to the overallfigures the Objective 6 Programme created the surprising number of 21 021 new jobs and it savedthe remarkably high number of 60 639 existing jobs (Table 4).

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Table 4. Key indicator figures of the Objective 6 Programme recorded in the national database Fimos.

New Saved New Persons Womenjobs jobs firms started

Priority 1. 12915 36684 1740 37865 14460

Priority 2. 3554 7890 536 73467 35072

Priority 3. 4549 16065 1431 26460 11731

Priority 4. Tech. Assistance 14 0 1 0 0

Total 21021 60639 3708 137792 61263

For example, for the measures 1.4 Promoting the establishment of companies and entrepreneurshipand 1.5 Personnel development to underpin the competitiveness of SMEs in key sectors and supportinvestment the quantitative objective for the number of people starting the measure was originallyset at 6 000 and 8 000 respectively. According to the statistics in Fimos, the actual figures were 14065 (+ 134 % in comparison with the quantitative objective set) and 23 800 (+ 197 %).

Within the measure 1.4 altogether 5 819 existing jobs were reported as maintained – the majority ofthem (over 97 %) being saved by the Ministry of Labour. What makes this figure very peculiar isthe fact that the objective of the measure 1.4 was to “promote the establishment of companies andentrepreneurship”. Hence, a rather interesting question can be posed: how was the Ministry of La-bour able to save an enormous number of jobs when the main target group of its actions was, andstill is, unemployed persons? The same concern could be raised via another question: how existingjobs can be maintained through promoting the establishment of new companies? Even if there hadbeen some retargeting of the funds within the measure, it is clear that these figures of the Fimosdatabase are misleading.

Since the database could not be used as such for the purposes of this evaluation, the actual level injob increase had to be estimated on the basis of the knowledge of the project leaders interviewedand who were responsible for informing the numbers to the district administration authorities andregional authorities. In addition, other experts were interviewed to create an overall perception ofthe employment impact at the Programme level. At the same time, the statistics illustrating theoverall developments in the region were focused.

According to the statistics, the Objective 6 Region has approximately 800 000 inhabitants and thenumber of jobs is 280 000 (December 2000). Against this background the following calculationscan be presented. If the figures in the Fimos database were correct, the programme would have ei-ther created or maintained 29 % of all jobs in the Objective 6 Region. According to the projectleaders interviewed, the database indicates too high figures for all core indicators except for thefinancial data, which is correct. The project leaders estimated that this inaccuracy of the Fimos fig-ures settles between 20–200 percent depending on the project, measure and priority under focus.This means that if altogether the creation of 100 new jobs has been reported to the authorities, thecorrect figure should amount to 33–83 new jobs. The project leaders clearly indicated that the fig-ures in the database are over-optimistic even though the figures would be stretched to cover thecases where a person is employed after weeks or even months following the closure of the project.

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As a general procedure, new jobs arising after the project implementation period are not reported tothe administration as an achievement of the project concerned.

The level of inaccuracy of the figures concerning new and safeguarded jobs recorded in the Fimosdatabase was debated with a number of national experts such as researchers and regional admini-stration authorities. These experts indicated an even wider “exaggeration gap” between the figuresin the database and the actual employment results of the programme compared with the views of theproject leaders. The experts stated that in some cases the actual employment result of a project hadbeen only approximately 10 % of the figure reported to the authorities. According to the most opti-mistic estimations, the experts assessed that 50 % of the figures recorded in the database could beseen as a correct number. The final estimates drawn on the basis of these expert interviews and de-bates with the team members of this evaluation can be concluded as follows: the closest estimate toaccurate percentage figures for new jobs and maintained jobs would be somewhere between 10–20% of those figures reported in the Fimos database. Therefore, the evaluation team concluded withthe application of a 15 % estimation level on the figures of the Fimos database.

Table 5. Estimations on jobs created and maintained and firms generated as a result of the Objective 6 Pro-gramme based on the Fimos database. The 15 % estimation rate for the “true figures” of the Fimosdatabase was set on the basis of assessments received from project leaders and regional developmentexperts and the inter-team debate of the evaluators.

New Maintained Newjobs jobs firms

Total (Fimos) 21 021 60 639 3 708

Estimation (15%) 3 153 9 096 -

As an outcome of this estimation process, the following figures are presented as numbers for jobscreated and maintained together with new firms established as an effect of the Objective 6 Pro-gramme (Table 4):• The number of new jobs created is around 3 150;• The number of jobs maintained is about 9 100;• The number of new firms established is 3 700, which indicates the number of new companies

that have been established with the assistance of the Objective 6 Programme1. It is noteworthythat many of these companies would have been set up irrespective of the public sector supportmeasures (see also Figure 16 on page 44). Therefore, it is extremely difficult to “isolate” theimpact of the Objective 6 Programme on the firm generation.

Despite the fact that these figures do not reach the targets set in the SPD for Finland the result cannot be regarded as a failure. The objective setting process had been hasty and over-optimistic (seechapter 3.2) and therefore the results should not be compared with the original targets. The eco-nomic backwardness of the area, rapid growth outside the Objective 6 Region and the on-goingstructural changes of the economy together with the present circumstances of low population den-sity and a relatively low educational level did not allow much better results with this type of devel-opment actions. However, the situation would have been a lot more difficult without the Objective 6Programme: thousands of people would have left the area in addition to those who did, the negativeimpact of depopulation (on demand of private services etc.) would have been a lot more severe. The

1 The estimates of new firms will be discussed in depth in section 6.3. Impact on the promotion of entrepreneurship.

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programme was therefore not able to stop the negative development, but it successfully decreasedits impact.

An interesting aspect to hypothesise is the cost of job in the Objective 6 Programme – this indicatorcan be regarded as one of the tools to demonstrate the level of efficiency of the Objective 6 Pro-gramme. If the total effect on the employment was fixed around the estimate of total 12 250 newjobs and/or jobs maintained, the cost for each job would amount to 44 300 Euro of Structural Fundssupplemented with 48 300 Euro of national co-funding. As a result, the full public cost for each jobcreated or maintained as an outcome of the Objective 6 Programme would be in total 92 600 Euro.

6.3. Promotion of entrepreneurship

The promotion of entrepreneurship was one of the most important objectives in the Objective 6Programme. It was supposed to create new jobs to compensate the job loss in other sectors. Encour-aging entrepreneurship was also expected to accelerate economic growth in the region. Methodsincluded, for example, provision of education regarding both entrepreneurial and vocational skills.

However, the attempts to increase the number of new firms and jobs faced unexpected problems.This situation can be explained by the changes in the regional economies. The income level ofmany groups of people had fallen due to higher taxation, unemployment or decreasing farming in-come. Also the rapid out-migration had affected the regional demand for goods and services. There-fore, the markets were growing slowly in the area and in fact the net firm birth had been in declinesince 1995. Furthermore, since 1999 the number of firms finishing their activities has been higherthan the number of new companies (Figure 21).

Figure 21. Net firm birth rate in Finland and four largest regions in the Objective 6Region in 1995-2000.

Partly this development was due to the high levels of firm birth rate in 1995. At that time many un-employed people started new companies. Many of these firms are now being run down, after thepeople concerned have become employed. Also the national firm birth rate is lower than in 1995,although it has remained clearly positive for the past 6 years.

This development shows some weaknesses of this type of action aimed at increasing the number ofnew firms. If the total demand in the regional economy is growing very slowly, possibilities to start

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businesses for example in private services remain limited. In the Objective 6 Region this has beenthe case: the annual growth rate of income level (1995 – 1999) for the whole country was approxi-mately 4.5% and in the Objective 6 Region only 2%. In these circumstances new companies can besuccessful only if they are “exporting” their products to other areas where the economy is boomingand therefore demand is growing.

If only the supply of private services can be increased, the possible consequences are not promisingfor the region:

• Educated people do not employ their expertise;• New companies replace existing firms or• New businesses are started outside the Objective 6 Region which is suffering low demand

for private services.

The out-migration is a quite rational solution for young, professional people with job opportunitieselsewhere. According to the interviews, many of those who were trained left the area to be able totake an advantage of their increased expertise. From the regional development point of view, theexpertise is leaking out of the Objective 6 Region and thus the out-migration increases. Even moreinteresting is the fact that those who actively seek to participate in the training provided by the Ob-jective 6 support are generally better educated to begin with in comparison with the group of popu-lation remaining passive. Therefore, the education is accumulating among a certain part of thepopulation and moreover, the Objective 6 Region is continuously losing its best human potential forgrowth.

The exact number of new firms created as a result of the Objective 6 Programme was very compli-cated to estimate. To some extent, the problems were similar to those experienced in assessing thenumbers of jobs created or maintained. The establishment of companies months or even years afterthe closure of projects brought along additional difficulties in this task. Nevertheless, the originalFimos figures are expected to be quite accurate. It still has to be emphasised that these figures indi-cate the number of new firms which have to some extent benefited from the Objective 6 Programmeat the time of their set-up. The figures do not indicate how many new firms were actually started asa direct consequence of the actions taken in the Objective 6 Programme. Starting a new firm de-pends on several different factors - public support or entrepreneurship education is only one ofthem.

The figures in the Fimos database give evidence of the fact that the Objective 6 Programme has af-fected the establishment of a total of 3 700 new firms (see Table 4 on page 52). This figure appearsreliable and thus indicates the actual results of the programme quite well. However, it does not re-veal the number of companies that would have been started only as a result of the Objective 6 Pro-gramme. This figure is more likely to indicate the number of those new companies whose birth hasto some extent been affected by the programme. “The dead-weight effect” should also be taken intoaccount in this connection similarly to the case of investment aids (Figure 16 on page 44). Most ofthe actions – in this context the creation of new firms – would have been taken irrespective of pub-lic support. However, the public intervention improved the quality and the financial status of newcompanies by offering their owners education, consultation and investment aids.

The Objective 6 Programme has affected the establishment of quite many new companies. Com-pared to the number of inhabitants in the region the new firm birth rate has been quite high. AlsoFinnish statistics support this view indicating that a total of 15 000 new companies were establishedin the four largest regions of the Objective 6 Region during the programme period. However, onemust bear in mind that quite a few of these companies have already been run down. The net firm

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birth rate has been in decline during the past two years in Finland. This development has affectedthe Objective 6 Region more severely than other parts of the country (Figure 21).

The total public spending covering Structural Funds interventions and national co-funding underPriority 1 Business development and company competitiveness was 381.75 million Euro. Priority 1was mostly responsible for supporting the activities of new company establishment. Against thisbackground, the share of public spending for each new firm was 102 950 Euros. This figure is how-ever very tentative since this priority included many actions that only improved the general circum-stances for entrepreneurship. On the other hand, projects implemented under other priorities, in-cluding capacity building elements aimed at the promotion of entrepreneurship, might have led tothe establishment of new companies. Another thing that must be borne in mind is the fact that themajority of new firms do not often survive but end their business activities within the first threeyears of establishment.

6.4. Meeting the aims and objectives of the Community priorities

The promotion of sustainable development is an important theme that was taken into considerationin the course of the programme implementation due to the extremely vulnerable nature of the Ob-jective 6 Region. It was considered that it might be affected negatively by the increase of industryor services. However, the largest risks for the advancement of sustainable development are found insectors related to primary production and fisheries as well as farms and forestry.

Due to the types of the development actions under the Objective 6 Programme and the strict na-tional environmental legislation, the projects implemented did not have any major negative effectson the nature. For example, the national legislation regulates strongly tourism related investments –no activity is allowed to disturb the nature. In most cases these tourism investment projects of theObjective 6 Programme were also rather small-scale since the specific natural conditions in theObjective 6 Region do not favour mass tourism. As far as the development actions of industry andagriculture are concerned, the situation was the same: the present national legislation does not allowany major negative environmental impacts. The Objective 6 Programme also prioritised measuresaiming at the improvement of production and not at the creation of any massive industrial or infra-structure investments. Simultaneously with the programme implementation, the national legislationconcerning nature preservation has also been tightened. Therefore, the Objective 6 Programme im-plementation did not have any major effects on the environment.

According to a limited number of interviews conducted around the theme of sustainable develop-ment, the issue has been an important factor in projects suspected to have a significant effect onnature. As a general rule, sustainable development matters were discussed during the project selec-tion phase and in most cases they were also taken into consideration. Despite this and the fact thatthey had been taken into consideration in the project planning and implementation, it seems thatthese questions have been left in a secondary role. In brief, job creation and company competitive-ness were seen as having priority overriding all the other themes. On the other hand, the programmedid include projects built solely around the theme of environment. The majority of these projectswere implemented under the measure 3.11. (Management and protection of the environment).

Equal opportunities were mostly understood in the Objective 6 Programme implementation as aquestion of the sex of project participants. To be more specific, in several cases the equal opportu-nities approach was limited to sex-counting meaning that the projects ensured the inclusion ofwomen in project activities without any true attention to promoting equal opportunities between

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women and men within the aims and objectives of a project. In this conjunction, the promotion ofemployment was yet again seen as the most important goal for a project and thus questions of equalopportunities remained in a secondary position.

The importance of considering the special needs of young people, older people and the Sami peoplewere much less frequently mentioned among the key informants and project leaders than the issueof promoting women. Hence, it can be declared that the expertise in promoting equal opportunitiesand gender issues was very limited among the actors in the programme implementation period. Forinstance, statistics were not collated in a way that would make the groups which should have bene-fited from the equal opportunities approach visible. The lack of the focus on the marginal group ofSami people and their special rights under the Objective 6 Programme was also highlighted in theex ante evaluation of the programme. Despite this, a few projects were targeted at these specialgroups, for example, one large project was implemented to establish a centre for Sami heritage – theSami museum “Siida”.

Figure 22. The unemployment rates of women and both sexes in theObjective 6 Region 1994-2000.

In summary, the question of equal opportunities was simply forgotten in many projects. Althoughwomen or any other vulnerable groups were not discouraged from participating in projects the na-ture of the projects – a large share of projects were targeted at industrial professions – caused alower level of female participants (44%) than male participants. In this regard it is interesting to payattention to the unemployment rates for women. This rate seems to have followed the general de-velopment of the unemployment in the Objective 6 Region (Figure 22). The unemployment rate forwomen was somewhat higher than that of men already at the beginning of the programme periodand the gap has remained almost the same. Although these figures are not signs of a total failure ofthe programme in meeting the Community Priority of promoting equal opportunities they prove thatone important aim of the SPD was paid little attention in the programme implementation: prevent-ing the out-migration especially that of women and young people.

RTD was in a central position within Priority 1 Business development and company competitive-ness. The priority’s objective included elements of research, technology and development actions.Likewise, both Priorities 1 Business development and company competitiveness and 2 Developmentof human resources and expertise included some measures supporting this Community Priority. Theelements of RTD were incorporated into many capacity-building projects under the Objective 6Programme. It was one of the most important factors in the attempts to increase company competi-tiveness.

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Information society related matters were one of the central objectives in the programme. They wereincluded within the measures 1.6 Development of telecommunications network services and 2.8Human resources action aimed at the development of the information society and distance workingtogether with development activities such as training were also carried out under other measures.The projects implemented under these measures were targeted, on the one hand, at creating infra-structure, and on the other hand, at increasing participants’ capabilities of using modern forms ofcommunication. The infrastructure projects were supported to a large extent by public funding.Furthermore, they were often related to the capacity building projects of educational institutions.Apparently, demand for education on information society related subjects was high within the Ob-jective 6 Region. Almost 13 000 people participated in training projects in order to improve theirabilities to use modern information technologies.

SME development was an extremely important goal for the whole Objective 6 Programme. It wasset in parallel with the aims of job creation, diversification of the regional economy, company com-petitiveness and other important objectives during project selection. Despite the rather high re-quirements for private financing especially in investment projects (approximately 70%), measurestargeted at this theme were in active use. This tendency can also be seen in the financial allocationsof the programme – Priority 1 clearly exceeded the frames for spending (see Table 3 on page 38).Private companies were those who gained from the increased spending within this priority.

SME development projects mostly involved companies who already started with quite high levelsof expertise. This is a very common problem experienced in regional development actions. Thesituation reflects that for training. Just as those people with the lowest standards of knowledge arethe least eager to attain training, similarly, those companies with the lowest standards of expertiseare the least interested in developing their actions.

SME development was implemented via a variety of actions. Some actions were targeted at SMEsdirectly (e.g. investment aids and training of the employees) and some indirectly (e.g. improving theinfrastructure in the region or improving the educational level among the population). These activi-ties have had a significant role in business development of the Objective 6 Region. However, thesebenefits have not been sufficiently taken advantage of in the region due to the generally unfavour-able economical circumstances.

6.5. Insight into the unforeseen impacts of the programme

One of the most important impacts of the programme was the birth of a new regional developmentmodel. Before entering the European Union the Finnish administration was built upon a bureau-cratic and sectoral organisation structure. Each sector of administration had their “headquarters” inministries in Helsinki. The regional administration authorities followed the directions of those min-istries. This was the general structure of the Finnish administration. In some regions well-functioning regional planning groups existed. However, the smoothness of the collaboration was aresult of personal relations between regional actors.

The strict ministry-specific orders of each sector of administration made any attempts at coopera-tion very difficult. In addition to that, different regional authorities “lived their own lives”, that isthey were unfamiliar with the issues the other authorities were conducting. In some matters, differ-ent authorities even seemed to be competing with each other.

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The launch of the Objective 6 Programme marked an important and very useful change in this tra-dition. First of all, it forced the ministries to cooperate in the planning process of the programme.Even more importantly, it gave the regional authorities the opportunity and also the obligation toact together in favour of regional development. This led to open dialogue and also opened up newavenues to manage the complicated problems of regional development.

The Regional Management Committees started their work at the beginning of the programme pe-riod. Authorities from the different sectors of the state administration, local and regional authoritiesand representatives of other groups, private companies etc. began to work together in order toachieve their common objectives in regional development.

In the interviews of key informants the new era of the inter-administrative collaboration at nationallevel, and also in the form of setting up Regional Management Committees, was regarded as themost important impact of the whole Objective 6 Programme.

Another impact was the creation and concentration of expertise related to making project applica-tions and running projects. Different educational units like universities and polytechnic schools be-came centres of this kind of expertise. Their role in different projects was growing during the wholeprogramme period. This development and its consequences have been discussed more precisely inchapter 3.

6.6. Perspectives concerning the efficiency of the programme

Measuring the number of new jobs created by the Objective 6 Programme was a difficult task. Forvarious reasons (see chapter 4.6 for details) the official monitoring system did not produce reliabledata. Therefore this data had to be re-evaluated in order to find a reliable estimation of the numberof sustainable new and maintained jobs in the region. After different phases (see chapter 6.2) theevaluation team came to the conclusion that the number of new jobs would be around 3 150 and thenumber of maintained jobs approximately 9 100. This makes a total of 12 250 new or maintainedjobs. These figures do not include temporary jobs like those of the project leaders.

The cost of a new job would be 92 600 Euro excluding the administrational costs that were not in-cluded in the project budgets. Unfortunately there was no comparable information on this costavailable. There were also differences within the priorities of the programme due to the differentnature of projects. The project mass was very heterogeneous. In addition there were some difficul-ties in determining figures like cost of job. For example investment aid might lead to a loss of fewjobs in the short-term. However, in the long-term the same company might be able to increase theirproductivity and competitiveness and so be able to offer more job opportunities.

Fighting unemployment was clearly the most important objective of the programme. A high unem-ployment rate generally leads to problems like out-migration and ageing population. Reasons be-hind the high unemployment rates are usually very complicated. In this case they are mostly due tothe structural change of economy. The number of jobs in primary production and public serviceswent down in the Objective 6 Region in the 1990s. The Objective 6 Programme fought these prob-lems with measures increasing the supply of education especially in modern technologies and pro-moting the entrepreneurship and the diversification of the economy.

The immediate results of these measures were not as good as expected. The education gave the par-ticipants better possibilities to be employed. However, the continuing depopulation decreased the

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demand of private services and new jobs or business opportunities were not available. The remain-ing possibility for the newly educated unemployed people was out-migration.

New businesses should have been export oriented like industry or tourism. However, tourism as abusiness is not growing very fast: it depends on few seasons and therefore it can not provide regularincome for too many people. Industry located in the Objective 6 Region suffers from many relativedisadvantages compared to southern parts of the country. Since the remote location does not offerany significant advantages new companies are more likely to be started somewhere else.

In addition to these purely economical disadvantages the rural areas lose their population for otherreasons. Higher education is available only in large cities and young people from rural areas do notreturn after graduation. On one hand there are no jobs for highly educated people in rural areas andon the other hand many of these young people do not want to return. They prefer larger cities andthe activities available there to the often limited attractions of the rural areas. This development hasbeen noted in many European countries and also elsewhere – urban life offers not only necessaryjob opportunities but also a lifestyle that is often preferred by the younger generation.

Against this background the impact and efficiency of the Objective 6 Programme can not be meas-ured only by statistical means. The programme region was facing huge problems in terms of unem-ployment, out-migration and population structure. Therefore it is almost impossible to think of anysolution that might have turned the tide in the rural areas in such a short period of time.

The measurements of the economic activities (like numbers of new jobs or companies) depend moreon general economical development than any other factor. Therefore the true impact and efficiencyof the Objective 6 Programme must be measured by its capability to

• create the expertise and the infrastructure necessary to take advantage of the present and fu-ture opportunities and/or

• maintain the level of income during the structural change of regional economy in order tomaintain the economic activities in the region.

Following the discussion above, the impacts of the Objective 6 Programme should be seen in abroader context. The programme had a positive effect on tens of thousands of people and thousandsof companies in the region. Even if the results were difficult to measure in terms of jobs created andmaintained the programme region progressed in many ways with the assistance of the StructuralFunds. Education and counselling improved the capabilities of the unemployed and also of thosewho worked in different companies and farms. Ideas for new businesses were introduced and, forexample, many farms took first steps towards new ways of earning their income or improving theirefficiency. Therefore, the ultimate impact of the Objective 6 Programme remains difficult to meas-ure. At the moment not all of the impacts of the programme are visible and with the passage of timethese longer-term impacts are even more difficult to assess since many other factors have influencedthe development.

Despite the problems of measuring the impacts of the Objective 6 Programme, it is evident that theprogramme had many positive effects on the restructuring economy of the programme area. Im-proved income level, enhanced competitiveness and more effective ways of cooperation betweenthe actors have already had positive after-effects and many of those are still expected to emerge.The Objective 6 Region was hit by a number of major structural changes in the 1990s. The pro-gramme must be regarded as a tool not for repairing the damages but for creating new businessesfor future needs.

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In terms of numbers (like new jobs, new companies, demographic development) it seems that theObjective 6 Programme had been quite inefficient in achieving its goals. However, the improve-ment of vocational skills or the new ways of adapting new technologies and methods will havelonger lasting effects. Whether they are sufficient to stop the out-migration depends on many differ-ent factors. The most important of them is the general socio-economic development.

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7. COMMUNITY VALUE ADDED

This chapter looks at the success of the Objective 6 Programme in generating Community ValueAdded. The focus will be to look at results that have been achieved mainly by Community activitiesand that would probably not have been achieved by national means alone.

7.1. Institutional dimension

Multi-annual programmingThe five-year planning period introduced a new type of regional planning method for the Finnishadministration. Some ministry or municipality specific multi-annual planning systems had beentried previously but at the regional level this working process was quite new. Although in some re-gions previous efforts of this kind had been taken they had not evolved into a structured workingprocedure anywhere in the country.

The introduction of the multi-annual programme brought along a new and long-term framework forregional development work in Finland. Together with the emerging inter-administrational coopera-tion this new procedure opened up new perspectives for the Finnish authorities. The programmingwas however disturbed by some difficulties. For example, municipalities, as they participated in theimplementation of projects, were not accustomed to making decisions several years ahead. There-fore, projects had to be carried out in several short-term stretches. This lack of continuity causedsome problems, for example in the recruitment of professional project leaders. In addition, the re-allocation of the funding judged necessary at the interim stage of the programme implementationmay have had a negative impact on reaching the targets of the programme. Although this realloca-tion was considered necessary the procedure allowed less time for reaching the targets.

Despite all the problems experienced, the launch of the multi-annual programme period offered newavenues for regional development to have a longer-term sight and thus it was welcomed and highlyappreciated among Finnish regional development actors. The method also introduced new tools forregional development work.

Introduction of the Community methodsOne of the most important innovations in respect of the Community Value Added of the Objective 6Programme was the cooperation in regional development work emerging between the differentsectors of the Finnish public administration. As discussed earlier in this report, this was a totallynew working structure and it offered new possibilities for regional development. Some differenceswere experienced between the Objective 6 regions in the functioning of the cooperation but in gen-eral it can be stated that this was the one of the most remarkable results of the whole programme.

The payment system of the Objective 6 Programme differed significantly from those national sys-tems applied in the Finnish administration prior to Finland's accession to the European Union. Theprocedures for invoicing the costs of a project and for reporting the results of a project together withproject monitoring data were completely new. In addition, the system of reimbursable costs (i.e.funding being allocated to projects against the costs incurred) caused some problems for both theadministration and the project leaders. They were both inexperienced with the system and thereforeit was a learning process for both parties. Later on this system of more detailed project follow-uphas also been more widely used under the national regional development schemes.

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The introduction of the Community methods has also affected other national planning procedures.Multi-annual and inter-administrative planning processes have become more common in regionaldevelopment work. Although this new trend is not due to the Objective 6 Programme alone the pro-gramme has certainly had an impact on the introduction of these procedures.

Introduction of new evaluation culture for regional developmentBefore Finland joined the European Union the tradition of evaluating programmes and projects wasweak. Evaluations were usually limited to infrastructure projects of an extremely large size (e.g.effects of new bridges, railroads or power plants). Since 1995 the number of different evaluations –both internal and external – has grown rapidly. Evaluations have been delivered at each level of re-gional development work and the experience gained from this new procedure has been positive.However, some problems still arise when the quality of the internal evaluations and the applicationof the evaluation results are concerned. Quite often the results of the evaluations do not reach all thestakeholders – especially those in other regions.

Introduction of new working practicesDecentralised working practices based on regional cooperation between different authorities havebrought new possibilities for regional development work. As the authority to make decisions todaylocates at the regional level the interest of local actors in regional development work has increased.in the regions. Some differences in adopting these new forms of cooperation were recognisablebetween the regions. In some regions the new working practices were well adopted but in others thecreation of this cooperative culture was more problematic.

The adoption of these new administrative procedures took a long period of time. The differencesbetween the national working practices before 1995 and after Finland joined the European Unionwere quite substantial. According to interviews, this learning process lasted more than two years atall levels of the administration and implementation. The length of this learning process had a nega-tive effect on the results of the Objective 6 Programme.

7.2. Policy/priority aspects

Integration of the Community PrioritiesThe promotion of sustainable development was already an important and widely discussed themebefore the beginning of the programme period in Finland. Environmental issues were taken intoconsideration at all levels of regional development work. However, sustainable development wasseldom the most important criteria in project selection or planning processes. Usually, the projectswere first and foremost expected to improve employment or competitiveness. Hence, the Objective6 Programme had a limited impact on enhancing regional development work towards the issue ofsustainable development in the area.

Information society and the promotion of RTD were regarded as the major elements of the Finnishnational “survival strategy” during the years of recession. Therefore, they were also easily adoptedat all levels of the Objective 6 Programme. These themes were carried out predominantly via sup-porting infrastructure investments and educational projects.

With regard to the Community Priority of promoting equal opportunities, it was probably the targetto which least attention was paid during the programme implementation. It appears that measuresdirectly affecting unemployment were prioritised. The number of projects targeted at any specialgroup of people was scarce, but it does not mean that any group would have suffered from this

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situation either. For example, the number of women participating in the project activities was about44 %. The participation of other groups (young people, the Sami population) was not recorded inthe monitoring system. However, there are no indications of discrimination at any level.

Promotion of entrepreneurship and SME development was very well in line with national strategiesas well as the advancement of the Information Society. The extremely high unemployment rate re-quired measures to open up new employment prospects. Finland had recently lost thousands of jobsdue to the recession experienced globally. Moreover, the collapse of the Soviet Union had a nega-tive impact on the Finnish export trade, cutting exports by 20 %. The public sector had to cope withever-growing spending and a diminishing tax income. New jobs had to be created by encouragingentrepreneurship. This was both a national and European level objective and therefore both the tar-get setting and realisation of the projects were in parallel.

Introduction of new areas of policy programmingThe subjects of programming the policies for the Objective 6 Programme were similar to those con-sidered in regional development work prior to Finland joining the European Union. However, theapproach was quite different. More attention was paid to encouraging local actors to participate inregional development work. Project-based development work carried out under the long-termframework was introduced as well as other new procedures discussed earlier in this report. TheCommunity Value Added lay, therefore, in the question of “how” rather than in the question of“what”.

7.3. Cooperation and networking

PartnershipsThe active search for partnerships between various actors was to a large extent introduced at thelaunch of the Objective 6 Programme. Some attempts towards new partnerships following the Irishmodel1 had been taken in Finland previously but the idea was more clearly highlighted from 1995.The creation of new partnerships was very active among the actors but the results differed consid-erably between projects. Usually, the most successful partnerships were created inside the regions –less often between the regions. Some efforts were made to form partnerships internationally butthese attempts often resulted in gaining new innovations rather than well-functioning partnerships.

New partnerships were most frequently created between the administration units. Furthermore, newpartnerships evolved among the administrative units and the so-called third sector actors represent-ing various NGOs. Organisations in the agricultural sector were also actively involved in the part-nerships. It is noteworthy to emphasise that the role of the private sector companies in partnershipsremained small.

The creation of European partnerships was limited. The problem may lie in the fact that quite a fewregions in Europe share similar problems and similar background with the peripheries of the Objec-tive 6 Region. Although some projects introduced new ideas which originated in other Europeancountries these projects were not built on intense cooperation with European partners. The value-added gained from external partnerships and the exchange of best practices was more ad-hoc than aregular way of working. In conclusion, the involvement of external or even European partners inprojects was an exception rather than a rule – the partnerships were usually based on regional levelcollaboration.

1 Partnerships between different companies, the public sector and local organizations of e.g. the unemployed.

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Regional and local organisations and the European Community issuesAt the start of the Objective 6 Programme a new type of regional development body was established– the Regional Management Committee. The Committees were formed to coordinate regional plan-ning and were given the responsibility to lead regional development work. Moreover, they weregranted with the authority to control regional policy funds. As the Regional Management Commit-tees were established simultaneously with the launch of the programme they did not have previousexperience of this kind of cooperation. It appears that these committees have succeeded quite welldespite lacking this tradition of cooperation.

Other regional and local organisations seem to have adopted the Community issues at sufficientlevel. The municipalities have in recent years formed sub-regional units partly in order to decreasethe amount of administrative work and to create larger functional areas for regional developmentwork. These changes have brought new perspectives into regional development work as the coop-eration has increased and the competition between the neighbouring municipalities has decreased.

The development issues discussed above have been important to an area which has faced extremelydifficult problems of out-migration, losing human resources and experiencing extreme difficulties intrying to create new businesses based on export trade. Under these circumstances the learning proc-ess of regional and local organisations concerning the issues emphasised by the European Commu-nity has created useful methods for future regional cooperation.

The political dimensionThe attitudes among the people in the Objective 6 Region towards the European Union were quitenegative compared with those in southern Finland in the mid-1990s. These attitudes have notchanged considerably during the programme period. However, this should not be understood as afailure of the Objective 6 Programme. The attitudes of people are usually affected via complexmeans of which the Objective 6 Programme represents only one. In addition, attitudes alter quiteslowly – five years is a short period of time for this type of development.

Some interviewees reported that it is envisaged that the European Union will have a decreased in-terest to invest in regional development in the Objective 6 Region in the future and that this has cre-ated a negative atmosphere among people. This is based on the rumours concerning the current en-largement process of the European Union. Some actors may think that it is no longer feasible tomake long-term plans on regional development issues since funding for these purposes may de-crease drastically after the Candidate Countries join the Union. These attitudes might also be due toother issues. For example, many private companies reported that the implementation of a projectwas too time-consuming compared with the results achieved. The lack of regional developmentideas might have also caused problems due to the scarcity of competent actors in the Objective 6Region.

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8. LESSONS FOR THE FUTURE

Strategy and programming choicesThe strategic planning process of the Objective 6 Programme required new approaches from boththe ministries and other national authorities in Finland. The authorities were inexperienced in pro-gramme-based regional planning. During the programme period they learned how to collaborateand following this the results of the new cooperative structures were very satisfactory. These struc-tures can and will be used in future planning.

The problems of the Objective 6 Region were determined in a reliable way in the programmingphase. However, the depth of the regional development problems in the region was underestimatedand therefore the programme was expected to produce better results than was realistically possible.Too hasty decisions and choices made during the programming period and the limited attention tothe macro-economic facts of the region concerned led to setting the objectives far too high. Thevery ambitious objectives did not prevent the programme from reaching the best possible results butit caused some misunderstandings and confusion later during programme implementation.

As an overall assessment, the strategic programming choices met the regional requirements well.The programme was compiled in a way that responded to the real needs and problems of the area.The largest problems linked with the programming actions of the Objective 6 programme were thesetting of the objectives to an unrealistically high level and the allocation of the financial resourcesfar too precisely prior to the programme implementation. Both the financial plans and the targetsetting were reassessed during the programme period to meet the actual circumstances in the Ob-jective 6 Region. These problems seem to have been rectified in the planning processes of the suc-cessor Objective programmes.

Delivery and implementationThe delivery and implementation systems of the Objective 6 Programme suffered from the insuffi-cient administrative resources available, especially at the beginning of the programme period. Thelack of employees as well as the inexperienced staff led to problems at all levels of administration.Another problem emerged from the fact that the working procedures were completely new at alllevels. This led to the Finnish ministries responsible for the Objective 6 programme implementationexperiencing difficulties in guiding regional authorities or project leaders. Regional authorities hadsimilar kinds of problems. At the beginning of the programme period this overload of work led tothe situation that many young and competent administrative employees resigned. They were dissat-isfied with working under extremely tight schedules without adequate guidance and information.

From the administrative viewpoint the situation was difficult. The overall results achieved via theprogramme remained unavoidably low when far too few officials at the ministry level were com-pelled to learn quickly new procedures and they were required to pass their knowledge on to re-gional actors under tight time pressures. The situation of the regional authorities was just as diffi-cult. The scarce administrative resources together with inadequate and frequently changing instruc-tions from the ministries did not give the best possible starting point for the programme implemen-tation. A too weak “top-down” approach led to the situation where local level actors were given fartoo much scope for action. This situation could not be rectified by discussions following a mannerof “bottom-up” principle. The authorities at the ministry and regional level should have been pro-vided with adequate administrative resources in order to be able to guide the project leaders in muchfirmer way from the very beginning of the programme period.

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The project leaders suffered from a lack of information at the planning stage of the project propos-als. This was clearly caused by to two different problems. Firstly, the whole project generation sys-tem was dominated by a bottom-up approach. Especially at the beginning of the programme periodmany regional authorities remained passive and expected the project leaders to approach them withtheir project proposals. The potential project leaders were, however, not used to this kind of work-ing procedure and the authorities were unaware of the fact that they should have informed and edu-cated the potential project applicants about the application procedures more effectively. Anotherproblem was the lack of administrative personnel resources and the lack of information within thewhole administrative structure.

The start-up of the Objective 6 Programme in Finland was delayed due to various factors the mostimportant of which are the following:• inexperience of the administrative staff at all levels to work with a Structural Fund programme;• inadequate staff resources;• inadequate provision of rules and regulations concerning the programme implementation lead-

ing to the insufficient information flow at all successive levels from the Commission to nationalministries and further to regional authorities and finally to project applicants;

• lack of tradition concerning a project and programme-based work;• the Finnish tradition of regional development being very different from the requirements of the

Objective 6 Programme.

However, these problems experienced during the launch of the programme triggered the necessaryreactions in the administration. Towards the end of the programme period administrative resourceswere increased and the resources were partly reallocated. Also the fact that the actors at all levelslearned the principles and administrative routines made the process easier. As a result the pro-gramme implementation was more efficient at the latter half of the programme period. This delay inefficient programme implementation meant that the impacts of the programme were also delayed.

In order to avoid the emergence of these problems in the future, all levels of the financial admini-stration must be provided with adequate resources not only for administration but also for deliveringinformation and setting guidelines for future project leaders. The drastic consequences of thesetypes of failures are delays in the whole chain of the programme work – implementation, results andimpacts.

Monitoring systemsAnother severe problem experienced in the implementation process of the programme was the fail-ure to establish an accurate monitoring system. It should have been built in a way to ensure the reli-able and precise follow-up of projects and the whole programme. However, the monitoring systemwas to a large extent useless, not only for the purposes of this evaluation exercise but also for thoseinvolved in programme implementation. From the very beginning it failed to produce programmelevel information of any type since it had been built to serve the information needs at the ministrylevel. All ministries had their own monitoring systems that were difficult to combine. In addition,the data gathered was unreliable especially in respect of the results of the projects (such as numbersof new jobs).

A programme cannot be managed effectively if no reliable data on outputs, results or financialmatters are gathered precisely and appropriately. Steps in this direction have already been taken inFinland but for some reasons the system is still not functioning very efficiently. This is a problem ofa technical nature which should be rectified as soon as possible. This should also be given strongattention for the accession of the Candidate Countries. The problems concerning the inadequate

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and unreliable monitoring data lead to extra work at all levels of the administration. Although theseproblems did not hinder the Objective 6 Programme from achieving its targets they caused extrawork and costs that could have been used more efficiently. These problems probably also led tosome delays as well since the data necessary for retargeting the funds was not updated regularly.

Financial circuitsSince the payment system of the Objective 6 Programme was based on the reimbursable procedurethis created a long waiting period for projects. In many cases the situation was made worse due toproject leaders´ incompetence in invoicing procedures. Partly this can also be seen as an adminis-trative problem. At the beginning of the programme period even the authorities were to some extentunaware of the new requirements of the financial circuits. The new invoicing procedures differedsignificantly from the national systems in place prior to the Finnish accession to the EU. All thesefactors caused delays in the payments which led to some negative attitudes among project appli-cants towards these new types of projects.

Project leadersMany small companies or private persons participating in projects suffered from cash flow prob-lems. For them the waiting periods for payments were far too long, even in the cases where the in-voicing procedures and payments were running smoothly. In the remote areas of the Objective 6Region only a few actors had the capability to carry out projects funded via Structural Funds.Therefore, the public sector units such as universities and other educational units became ever moreactive in this field.

This development had both positive and negative outcomes. On the one hand, the public sector unitsgained more expertise and experience of regional planning projects. Therefore, they are today morecapable of running this type of project. This is an advantage for all actors. On the other hand, theprinciple of supporting the bottom-up approach in the Objective 6 Region is difficult to follow asonly large public units are capable of implementing these projects. This is a question of both finan-cial and professional capacity.

The Objective 6 Region is scarcely populated and remote. Therefore, the group of potential regionaldevelopment actors is also very limited. In effect, the public organisations are often the only actorswith both the capacity and the financial resources to lead these projects. The remote areas simplylack the human resources needed for this kind of regional development work. This lack of humanresources was extremely severe in those administrative regions that only partly belonged to the Ob-jective 6 Region.

The prerequisite for effective regional development work is the application of regional developmentactions in functional regions – not in isolated parts of them. In the Objective 6 Region many smallsub-regions were “cut out” from their natural partners. These remote areas therefore suffered from alack of human resources and regional partners since these resources located outside the programmeregion.

As a consequence, small sub-regional units in regions falling only partly under the programme re-gion experienced difficulties in the creation of innovative projects. These sub-regions did not pos-sess sufficient human resources for large-scale regional development projects. Evidently, the mainregional centres of these regions were less interested in managing the development work of theirdistant sub-regional units. This is an important lesson for the future – the inclusion of small sub-regional units being cut out from their functional regions in the Objective programmes must be con-sidered very carefully.

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Partnerships, cooperation and project sizeDespite the positive developments in the administrative cooperation in both national and regionallevel, the partnerships did not emerge as planned. The functioning partnerships were reduced tothose including participants from only the public sector and NGOs. Private companies did not par-ticipate in the development work to the extent they could have. Subsequently, the experiences con-cerning the partnerships were not as good and encouraging as was expected.

One important lesson learnt in the course of this evaluation is that the complex regional problems –which require a set of diverse measures to be solved via Structural Funds – should be incorporatedinto a few large umbrella projects. It is not efficient or feasible to solve these vast regional problemsvia a number of small projects only because the regulations of the Structural Funds require this ordue to the annual budgeting procedures of municipalities. Too large a number of small projectsleads to various problems at all levels. Small projects should not be prohibited but they should belinked within larger frameworks or “umbrellas” for projects. Similarly the administrational proce-dures causing the split of projects into smaller parts should be changed. These procedures currentlycover annual budgeting and many-faceted project approval systems at local and regional levels.

One possibility for enhancing the effectiveness of regional development work could be an increaseof the decision making power at the regional level. Regions should be offered more possibilities notonly to draft their own strategies but also to decide the allocation of resources to implement them.These strategies could open up new avenues for large-sized umbrella projects and they could alsoprovide the project leaders with clear ideas for the future project planning. The bottom-up principlecould still be followed but the development work would have a solid regional framework based onwidely accepted regional strategies.

Employment and out-migrationThe enhancement of the educational level among the people living in the Objective 6 Region doesnot necessarily lead to an increase in the number of jobs. If there is no growing demand for newprivate services, there is no increase in the number of companies either. The efforts to increase thenumber of new companies in remote areas should be concentrated on export-oriented companies(export from the region). In many cases the educated people choose to leave the area which is, fromthe individual point of view, a quite rational option.

The statistics and indicators displaying the population development in the Objective 6 Regionshowed quite negative trends. Paradoxically, it seemed like the Objective 6 Programme had trig-gered the out-migration by improving the level of education and therefore offering the people withbetter possibilities to be employed outside the region. This is however not the problem – the realproblem lies in the lack of jobs in the programme area. It is possible that if the number of jobs in theregion increased, many of these people would return.

A key factor in the promotion of positive regional development in the Objective 6 Region is to se-cure the possibilities for employment. However, there are also other factors. The area might sufferfrom high out-migration rate despite the employment situation. This has been reported in some ruralmunicipalities with strong industrial companies. The number of jobs for women could be regardedin these cases as a crucial factor but also the overall attractiveness of the area plays an importantrole. The remoter areas are usually not found attractive despite the present tendency of Finns tomove to rural areas – the rural areas perceived as attractive in the minds of Finnish migrants arethose adjacent to towns or cities.

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Future programmingThe Objective 6 Programme introduced a new concept for regional development work in Finland. Ithad many advantages compared with the regional development work previously implemented atnational level. The most important benefit was the inter-administrational cooperation that opened upnew opportunities for regional development work.

However, one important question must be raised. Are there any realistic possibilities for reachingpositive results, for example in halting out-migration, with Structural Funds’ intervention and itsmeasures in the Objective 6 Region? The area is characterised by a long history of depopulation andproblems that have arisen from, for example, the low population density and the lack of demand forprivate services. The vicious circle of the weakening economic activities and the diminishingpopulation is extremely difficult to impede especially as economic growth has been quite fast inother parts of the country.

Another question that can be posed concerns the possibilities of creating growth in the Objective 6Region. Is it possible by any means to stop the out-migration and if not, what kinds of objectivesshould be chosen instead? Should the targets include only maintaining the necessary infrastructureor should the objectives include safeguarding only the most vital parts of the whole region? Onepossibility to ensure greater impact could be to set the objectives so that the economic growth ispromoted only in the urban areas of the Objective 6 Region and not in the most remote rural areas.At all events the objectives should not be unrealistically high to achieve.

Key Lessons for the Future1. Setting the objectives in the SPD to an unrealistically high level should be

avoided.2. Financial plans must be flexible in order to allow changes in circum-

stances and regional adjustments of the strategies during the programmeperiod.

3. The administrative resources must be adequate for the decision-makingand payment procedures as well as for the guidance of project leaders.

4. The functioning of the monitoring system must be ensured: both data col-lection and reporting systems should be centralized and harmonized.

5. The lack of human resources must be taken into consideration in the mostremote programme areas: inadequate local development resources do notallow effective development actions.

6. The implementation of regional strategies and also the functioning of theadministrative routines require large umbrella projects instead of a largenumber of small projects.

7. Job creation requires economic growth for which a prerequisite is an in-creasing income level. The enhanced education level of the populationalone cannot lead to a positive impact in the situation where the economyis losing its vitality.

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9. CONCLUSIONS

The Objective 6 Programme for Finland was targeted to combat the actual problems in the region.The programming work succeeded quite well despite the inter-ministry difficulties at the beginningof the process. The Single Programming Document included all the necessary information for theprogramme framework. It can be regarded as relevant and appropriate except for setting the quanti-tative objectives.

The new regional development system introduced as a result of the programme launch was highlyappreciated by Finnish regional development actors. The procedure of granting the regional actorsboth with the responsibility and the resources for the regional development work can be regarded asa success of the programme. This was a major change in the Finnish administrative system.

The delivery and implementation system failed in some major issues. The administrative resourceswere inadequate at all levels (ministries, regional authorities). Partly it was a question of newworking procedures but also the number of employees engaged in the programme implementationwas far too limited. The information did not pass through the administrative chain efficiently andvery few were on top of their duties. As the time passed new personnel was employed and the ad-ministration learned their duties. These problems also affected project leaders who at the beginningwere unaware of the programme requirements.

One of the major concerns during the programme period was the monitoring system. The systemfailed to produce any qualitative data. Furthermore, major problems were experienced with theprocessing of the basic quantitative data. Despite serious attempts, the Fimos database did not worksufficiently well and its information was unreliable. The emergence of the problems in the moni-toring system could be traced to all levels – the Finnish ministries, regional authorities and projectleaders.

The financial allocation of the Objective 6 Programme was principally managed in an accuratemanner. Only a few alterations had to be made due to the original extremely tight financial matrix.Some problems were caused by the heterogeneous nature of the region. After these adjustments thefinancial allocation of the programme began to operate better and these issues were taken into con-sideration in the later programme work.

The measures taken in the programme were to a large extent appropriate. They were targeted at thegroups of people or companies in need of the support and in general they were also managed appro-priately. However, the actual results achieved can be regarded as quite inadequate to deal with theproblems of the area. The programme did not succeed in halting the out-migration. Moreover, theage structure of the population is worsening. The Objective 6 Region is losing its vitality. This vi-cious cycle is caused by a variety of factors which the Objective 6 Programme had inadequate re-sources to combat. First and foremost, the programme area was affected by enormous structuralchanges at the time. The overall macro-economic development was a far greater factor than theObjective 6 Programme. However, without the programme intervention the situation would haveworsened dramatically and in this sense the programme could be regarded as a success in hinderingthe negative development.

Despite its problems, the Objective 6 Programme brought along many positive elements. In conclu-sion, the programme made the negative development less drastic and introduced new methods andworking procedures to the Finnish administration at both national and regional level. Although theprogramme was not able to prevent the out-migration or solve the problem of unemployment, it

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certainly succeeded in reinforcing the regional development work in Finland, particularly from theperspective of introducing new tools for future regional planning.

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APPENDIX. Objective 6 Programme; Priorities and Measures.

Priority 1. Business development and company competitiveness1.1. The creation of new business activity to develop and diversify the areas economic structure1.2. Development and investment by existing companies and by businesses newly locating in the area1.3. Improvement in operating environment for business1.4. Promoting the establishment of companies and entrepreneurship1.5. Personnel development to underpin the competitiveness of SMEs in key sectors and support invest-

ment1.6. Development of telecommunications network services1.7. Encouraging the use of bioenergy and other renewable sources of energy and development of energy

infrastructure and networks

Priority 2. Development of human resources and expertise2.1. Investments in higher education and training establishments and R&D activities required

to develop expertise2.2. Research, technology and training supporting development of key sectors2.3. Development of cooperation and networking to promote expertise2.4. Pathways to employment and prevention of exclusion2.5. Integration of young people into the labour market2.6. Vocational training and retraining, guidance and advice2.7. Anticipation of changes in labour markets and development of expertise systems2.8. Human resources action aimed at the development of the information society and distance working

Priority 3. Agriculture, forestry, fisheries, rural development and the environment3.1. Improvement of the efficiency of agriculture: Investment aid to agricultural holdings and back-up

measures to assist agricultural holdings3.2. Establishment aid for young farmers3.3. Compensatory allowances for mountain and hill farming in less favoured areas3.4. Development of processing and marketing of agricultural products3.5. Establishing producer groups for agricultural and horticultural products3.6. Training to encourage structural adjustment in agriculture3.7. Development of the structure of the fisheries sector3.8. Rural development package – ERDF3.9. Rural development package – ESF3.10. Rural development package – EAGGF3.11. Management and protection of the environment

Priority 4. Technical Assistance