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5th Feb 2023

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EU cohesion policy: 'No more business as usual'

  • More of this... (Photo: European Commission)

The EU has revamped its regional aid policy leaving national programmers nervous about the more rigorous rules designed to put a halt to the redundant motorways and superfluous airports of previous years.

Very much influenced by the economic crisis, now in its sixth year, the cohesion policy (2014-2020) has a new more stringent feel.

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  • And less of this (Photo: EUobserver)

The revamped policy - which at €325 billion accounts for a third of the 7-year EU budget - is due to be agreed by the European Parliament in November.

"It is absolutely not business as usual. The whole design of the policy is different," said Magdalena Sapala, an expert on Cohesion policy at the Brussels-based Institute for European Studies, with the focus no longer on removing economic disparities between rich and poor regions.

"We cannot think of this policy as a just a charity aid for poorer regions any more. It is about growth for all territories and has become an instrument for the implementation of the EU 2020 strategy," she added, referring to the EU's long term economic goals.

Sapala notes that the focus on growth will shift the past "fixation" with how much a region can spend towards strategic planning.

Among its most controversial changes - still being contested by MEPs - are macro-economic conditionality as well as a plan to withhold a percentage of the aid until a project is successfully completed.

Critics say withholding aid money from those member states not obeying EU budget rules risks punishing regions for policies over which they have no control. While the second criteria could lead to unambitious projects.

Meanwhile projects will now also be subject to "ex-ante conditionality" assessing whether they are in line with overall EU policies.

The overall aim is to both improve how money is spent as well as the strategic thinking behind the spending.

EU regional commissioner Johannes Hahn promised his institution will tread lightly when it comes to potentially withholding regional aid.

The use of the macro economic stick will be "ultima ratio in case of persistent misbehaviour of a country."

"The system proposed by the commission gives time to member states to introduce the necessary reforms before suspension of funds is activated," he told this website.

But whatever about the macroeconimc criteria - stealing the most headlines - some suggest the other changes could prove more difficult for regional authorities.

Gap in expectations

"There is a big gap between the expectations of the commission and the ability in some quarters to be able to deliver on that. Because it implies quite a substantial change in the logic of programming," said John Bachtler, an expert on cohesion policy at Scotland's Strathclyde University.

He questioned, at recent conference in Brussels, whether programmers have "resolved the very real problems of identifying a clear causal chain between allocation of resources, setting of particular objectives, to the outcomes expressed in terms of results."

A commission official, meanwhile, underlined the extent to which the economic crisis is affecting the approach to the policy.

"Be strategic. What result do you want to achieve, by, let's say, 2020. And try to choose indicators which are explainable to the common citizen," said Jose Palma Andres from the commission's regional department.

"Even if you can't quantify the result you can at least qualify it. And explain it. This is the new approach.

Otherwise it is very difficult to explain in this very tough period of financial resources everywhere that we are spending the money but we don't know for what," he added.

Marko Ruokangas, programme director for the Finnish region of Oulu, admitted that strategic thinking may have been missing in the past: "We were not so good in that in existing programmes."

"And now is the time to discuss that," he said, referring to the preliminary stage of programme preparation with the European Commission that is due to go on until at least the end of the year.

Time pressure

Once the regulation is finally signed off by the parliament, operational programmes outlining how money will be spent have to be drawn up and agreed with the commission.

But adding to the mix of finding their way around the shaken-up policy is the time pressure.

"Negotiations were very late. This means local and regional authorities have to race against time. Everyone is under pressure," said Pierluigi Boda, spokesperson at the committee of the regions.

The contracts are meant to be signed off before the European Commission stops works ahead of the EU elections in May 2014.

This story was originally published in EUobserver's 2013 Regions & Cities Magazine.

Click here to read previous editions of our Regions & Cities magazine.

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