Thursday

19th Jan 2017

Interview

Regional funds may be linked to pension reforms

  • Johannes Hahn says structural funds should be used to make countries stick to economic reforms (Photo: European Commission)

Linking EU regional funds to economic reforms is "fair" because it applies to both euro and non-euro states, regional policy commissioner Johannes Hahn told EUobserver in an interview Friday (19 July).

"Macro-economic conditionality is one of the pending issues that is subject of ongoing negotiations in July, but we should definitely reach an agreement beginning of autumn," Hahn said.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

Earlier this month, the European Parliament made it clear that they would not accept this new conditionality for the €376 billion worth of regional funds in EU's next seven-year budget.

This is the main sticking point among MEPs, member states and the EU commission in transposing an agreement on the €960 billion budget into legal acts and rules.

"Everyone has an interest to have a rather quick decision if we want the funding to start next year. The multi-annual framework is also a sort of orientation for the private sector of how much money is available, that could trigger additional private investments," the Austrian politician said.

He admitted that "positions are far quite far apart", as MEPs are rejecting any link to economic reforms.

MEPs argue that the idea came up before the EU commission got new powers of oversight for countries lagging behind on economic reforms.

Hahn said this is true only for eurozone states, which are subject to increased scrutiny and sanctions from the EU commission.

"But there is nothing adequate for non-eurozone countries. Therefore the idea came up to use structural funds. This is nothing else than a justified attempt to have a fair treatment for everyone," he said.

Hahn said the details on how the macro economic strings would work in practice are not yet clear, but suggested it could also include reforms of pension systems.

"We still have discussions if structural funds could be used for more general macro-economic conditionalities. As an example, pension systems.

"We have many countries where the country-specific recommendations are referring to the existing pension systems that they need to be adapted in order to afford pensions in the future," he said.

He gave the example of Hungary, where the EU commission for the first time last year threatened to suspend the payment of regional funds because the country was not sticking to the EU deficit rules.

Hahn's services worked up a methodology on how to calculate the share of money that would be suspended, but in the end it was never used because Hungary got its deficit under control.

"The mechanism exists only for cohesion, but the idea now is to include all the other structural funds - regional development and social fund. This is still under discussion," Hahn said.

Focus

Dieselgate casts doubt over low emission zones

Many European cities use low emission zones, and some are considering to ban dirty cars. But there are limits to how well the EU standards can be used to determine which cars are clean.

Stakeholders' Highlights

  1. Caritas EuropaEU States to Join Pope Francis’s Appeal to Care for Migrant Children
  2. UNICEFNumber of Unaccompanied Children Arriving by sea to Italy Doubles in 2016
  3. Nordic Council of Ministers"Nordic Matters" Help Forge Closer Bonds Between the UK and the Nordic Region
  4. Computers, Privacy & Data ProtectionThe age of Intelligent Machines: join the Conference on 25-27 January 2017
  5. Martens CentreNo Better way to Lift Your Monday Blues Than to Gloss Over our Political Cartoons
  6. Dialogue PlatformThe Gulen Movement: An Islamic Response to Terror as a Global Challenge
  7. European Free AllianceMinority Rights and Autonomy are a European Normality
  8. Swedish EnterprisesHow to Create EU Competitiveness Post-Brexit? Seminar on January 24th
  9. European Jewish CongressSchulz to be Awarded the European Medal for Tolerance for his Stand Against Populism
  10. Nordic Council of Ministers"Adventures in Moominland" Kick Off Nordic Matters Festival in London
  11. PLATO15 Fully-Funded PhDs Across Europe on the Post-Crisis Legitimacy of the EU - Apply Now!
  12. Dialogue PlatformInterview: Fethullah Gulen Condemns Assassination of Russian Ambassador to Turkey

Latest News

  1. EU cannot copy Australia's offshore asylum model
  2. Brexit men launch anti-EU website
  3. Germany details its 'Marshall Plan' for Africa
  4. IMF predicts 'pain' for UK, as banks prepare London exit
  5. EP deal could help Tusk keep Council job
  6. UN struggles to monitor fate of readmitted Syrians in Turkey
  7. European space chief: Moon village is 'more or less a fact'
  8. May's speech was not a war declaration, Malta says