Some states fear withdrawal of aid
By Nathalie Vandystadt with Ophélie Spanneut | Monday 14 May 2012
While the European Commission received support for its plan to group all the MEDIA (audiovisual) and Culture programmes under the single banner ‘Creative Europe’ in 2014-2020, the member states’ ministers for culture, who gathered on 10 May in Brussels, warned against the temptation to look at the issue in economic terms only in the name of the quest for growth.
A note from the Danish EU Presidency, ahead of the meeting of ministers, stated that the national delegations had several times expressed their preoccupation with establishing a better balance between the economic objectives, such as competitiveness and growth, and the cultural objectives of the promotion of cultural and linguistic diversity.
Therefore, Copenhagen has made some adjustments to arrive at a partial approach on the Commission’s proposals. In practice, the proposed innovation comes from the establishment of a ‘financial guarantee’ mechanism that would allow small cultural entities to obtain bank loans. It would be managed by the European Investment Fund (EIF), would have a €201 billion capacity, and should allow to cover loans up to €1 billion.
While the ministers approve of the principle of a guarantee, they are sceptical about the terms, fearing it will create more bureaucracy and will de facto exclude micro-enterprises – those that need it the most. The ministers warn that any increase in the budget for this mechanism will have to be compensated by reducing another part of the programme. Indeed, some member states are very worried at the prospect of the withdrawal of EU aid for small and medium-sized enterprises and of an approach, for new bank loans, based more on economic than cultural performances. As a result, SMEs would depend on national subsidies only.
The Commissioner for Education, Androulla Vassiliou, argued back on two fronts. She dismissed the concerns of those who consider that EU subsidies only benefit the big cultural groups as “not valid”, stating that “Today, no less than 55% of EU funding under the current Culture programme goes to SMEs with fewer than 11 employees. This will continue under the new programme. The loan guarantee facility will be complementary to the grants that the EU offers; we have no intention to replace grants. Our proposal responds to a clear need, expressed by SMEs, who find it difficult to obtain credit.”
Indeed, according to the Commission’s proposal, all the SMEs will be eligible. But the Commission itself recognises that only enterprises with a viable business model, ie those that generate enough income to be able to reimburse loans to financial intermediaries, will, in practice, benefit from this mechanism. As a result, many of the member states have called for “clearer eligibility criteria” and a “geographical balance” in access to future credits. Lastly, even though the budget proposed - €1.8 billion - has taken up a large part of the Council’s exchanges, the budget decisions will be taken after the future – and most certainly tempestuous – negotiations about the Union’s multiannual financial framework 2014-2020.
The Commission considers that between 2014 and 2020, the future Creative Europe Programme will support an estimated 8,000 cultural organisations and 300,000 artists, cultural professionals and their works in 2014-2020 and that they will receive support to cross the national borders. According to the Commission, the programme will also help the translation of over 5,500 books and other literary works, while the MEDIA chapter will support the worldwide distribution of over 1,000 European films on conventional or digital platforms. Lastly, it will encourage the creation of films and audiovisual works that have a strong cross-border potential. The new programme will be open to the 27 member states plus Iceland, Lichtenstein, Norway and Switzerland – member countries, candidate countries, potential candidate countries and countries concerned by the European Neighbourhood Policy.