With the Strategic Transformation Support (STS), VLAIO has been stimulating investment and training projects of companies that contribute significantly to strengthening the economic fabric in Flanders since 2013. The support measure intervenes for 8% in strategic investment costs and for 20% in strategic training costs. The maximum grant is 1 million euros.
On June 4, 2021, the Flemish government gave its approval in principle to a reform of the Strategic Transformation Aid.
The reform introduces a simplification of the assessment framework, but at the same time involves a tightening in order to make the aid instrument more selective and qualitative.
What is changing?
- Bonus support for employment growth will be eliminated. The creation of additional direct employment and the strategic and sustainable embedding
of employment in the Flemish Region are instead integrated and concretized into the assessment criteria for basic support. - The basic scores to be achieved are tightened:
- Internationalization and sustainability, like innovation, become primordial parameters on which by all applicant companies must achieve the base score;
- The base score to be achieved for the sustainability parameter is tightened, so that it is always required that the project contributes significantly to reducing water or energy consumption and/or circular economy and/or environmental and climate objectives;
- The basic score to be achieved for the innovation and internationalization parameter will be tightened for medium-sized establishment units, in line with the required basic score for large establishment units.
- The current parameters are adjusted substantively:
- The number of assessment criteria will be slimmed down;
- Innovation is more clearly articulated;
- Internationalization is being redefined;
- Sustainability in the ecological field is more concretely delineated.
The changes can be summarized as follows.
| PARAMETER | CURRENT ARRANGEMENT | FUTURE ARRANGEMENT |
| Innovation | Medium-sized* entities** must achieve a basic "good" score on this criterion | Medium-sized establishments*** must achieve an "excellent" base score on this criterion |
| Internationalization | Medium-sized entities must achieve a basic "good" score on this criterion | Medium-sized establishments must achieve an "excellent" basic score on this criterion. |
| By small* and medium-sized entities, only one of the two criteria must be met | By small and medium-sized establishments, both criteria must be met | |
| Sustainability | ||
| Employment growth | Only needed for bonus support | Prerequisite for basic support |
| *Small = < 50 VTE
Medium = 50 FTE < X < 250 FTE **Entity = technical business unit *** Establishment = establishment unit as listed in the CBE |
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What will the assessment framework look like in the future?
After the reform, the assessment framework will look like this :
| PARAMETER | LARGE | BASIC SCORE |
| 1. Innovation | KV | good |
| MV | excellent | |
| GV | excellent | |
| 2. International competitiveness. | KV | good |
| MV | excellent | |
| GV | excellent | |
| 3. Social and environmental sustainability. | KV | good |
| MV | good | |
| GV | excellent | |
| 4. Anchoring the enterprise and employment and the overall strengthening of the enterprise in its internal and external value chain | KV | neutral |
| MV | good | |
| GV | good | |
| 5. Strengthening the value chain or cluster of strategic importance to Flanders and reinforcing the Flemish economy | KV | neutral |
| MV | good | |
| GV | good |
When will the reform take effect?
It is not yet clear exactly when the reform will take effect. The Flemish Government's amending decree must still be submitted to the SERV and the Council of State for their opinions, and only then can it be definitively approved. If everything goes smoothly, however, this could happen before the end of the year.
Companies with strategic investment plans in the next three years would therefore be well advised not to delay any further application for Strategic Transformation Support so that it can still fall under the application of the current, less stringent rules.
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