24th Oct 2016


An EU budget for recovery and Europe’s citizens

  • Warsaw: the EU spends five times more per capita in rural areas through CAP compared to funding in urban areas through structural funds (Photo: metaphox)

Europe is at a critical juncture, both economically and politically. Governments at all levels continue to feel the squeeze on public resources.

The next long term budget for the EU must reflect this by directing EU spending and investment where it makes the greatest and most visible impact for the majority of citizens. This would truly be a step towards both 'better spending’ and change in the EU in terms of economic recovery and restoring public confidence.

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Generating 85 percent of GDP, our major cities are the drivers of Europe’s economic growth.

At the same time, our cities are where the brunt of the crisis is being felt, and where social unrest and political discontent is most evident. A budget for Europe 2020 must recognise cities’ potential for playing a much greater role in Europe’s economic recovery and therefore the urgent priority for investment in urban Europe. The European Commission’s proposal to include an urban premium in the allocation method for structural funds did partly that and should be maintained.

Our continent’s model of well-managed urban concentration is the most sustainable form of development: our cities are our assets.

Only metropolitan Europe can compete with the power of emerging megacities of Asia and Latin America. An ambitious urban agenda across EU funding programmes is not only important for our cities but for the economic future of Europe as a whole.

Structural funds and programmes such as Horizon 2020 and the Connecting Europe Facility can help ensure vital investments, in cities and beyond, by attracting private and public resources to achieve the multiplier effect that is so important to make the most of every euro spent.

It is about maintaining and strengthening the initiatives that make a visible difference to peoples’ lives, creating jobs and supporting the development of innovative solutions and the green economy.

This also includes initiatives that promote urban-rural collaboration, recognising the potential for cities and their surrounding areas to jointly promote territorial cohesion across the EU. Therefore, it is critical that the funding programmes investing in our cities are not undermined by the decisions on the overall budget ceiling.

But as member states failed to agree on a new long term EU budget at the summit in November 2012, what seemed to be most in jeopardy are the very measures proposed by the Commission to support the "smart, sustainable and inclusive growth" that is Europe 2020’s goal.

In addition to proposing cuts to structural funds, new programmes such as Horizon 2020 and Connecting Europe recently came under pressure as ministers looked to maintain funds for agriculture and sparsely populated regions.

The Common Agricultural Policy (CAP) has traditionally been, for good reasons, the main plank of the EU budget.

Clearly, food security is important to all of us.

But currently the EU spends five times more per capita in rural areas through CAP compared to funding in urban areas through structural funds.

Yet the contribution of CAP to delivering the Europe 2020 objectives remains limited. And agricultural and rural expenditure is less visible and reaches far fewer people than structural funds investment, in particularly in urban areas where 75 percent of the population lives.

The agreement on the next financial framework must fully take account of the scope for better balancing the investments in Europe’s territories.

The immediate costs of a new financial framework may be painful for member states in the current economic situation.

But can Europe afford a budget that ignores the vital contribution our cities can make to a smarter, greener and more inclusive Europe by 2020 and beyond to the benefit of all Europeans?

The author is Mayor of Warsaw and President of Eurocities, a Brussels-based association


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