Wednesday

19th Sep 2018

Economic governance tool to be part of regional aid

  • More strategic thought is to go behind EU regional spending from 2014 (Photo: europarl.europa.eu)

MEPs in the regional affairs committee Thursday (7 November) gave the go-ahead to an overhaul of the EU regional aid policy, including its most controversial element - linking payouts to good economic governance.

EU regional affairs commissioner Johannes Hahn said the vote was a "major step forward" for the EU economy, with the €325 billion in the regional pot to be spent more strategically and without the bias toward traditional infrastructure, such as roads and airports, of past years.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

Hahn said the policy for 2014-2020 had a "fundamental new direction."

Over the coming years, projects will need to be either innovative, supporting small businesses, reducing poverty, boosting employment, or be green.

Funding will only get the green light if certain conditions are already in place such as good environment and public procurement laws.

There will also be spending-efficiency checks before any EU aid is disbursed and checks on on-going projects. Part of the payment will not be paid out until successful completion of the project.

Broad statements about investing in innovation will now have to be backed up with public information on exactly how the money will be spent and what the targets are.

With over 70 meetings between member states and MEPs, Hahn noted that macro-economic conditionality, whereby money can be withheld if EU budget rules are not adhered to, was "one of the most discussed issues."

The clause made it through despite strong opposition from leading MEPs who said that regions risked being punished for fiscal misbehaviour by central governments.

Impossible to use?

However parliament won the right to be involved in the process by being allowed to discuss any decision to use the macro-economic clause and to have its opinion taken into account.

Constanze Krehl, a German social democrat and one of the lead negotiators on the dossier, said the compromise means it will be "impossible" for the economic conditionality mechanism to ever actually be used.

Hahn, for his part, said the tool remains useable but it will be the "absolute last resort."

"I hope it will never have to be applied," he added.

The conditionality tool was pushed for by a group of member states including Germany and Finland who argued that there should be less cohesion money - the overall pot was slashed by €22 billion compared to the current budget cycle - and that it should be spent more efficiently.

According to Hahn, the new economic conditions are not what will give member states the most headaches.

It is the more rigourous thinking that authorities will have to apply to their project planning that is set to be a bigger problem.

"What will be a really big challenge for some member states will be to come forward with strategies in the different areas," said Hahn.

Taking transport policy as an example the commission said that member states have to have a comprehensive transport policy - not just "bits and bites" - and "future projects must be embedded in the overall strategy."

"This is clearly a precondition."

The committee's vote has still to be endorsed by the plenary as a whole later this month amid general time pressure to get funding agreements between member states and the commission wrapped up before the EU elections in May 2014.

Opinion

Cities show leadership on Roma inclusion

Over the last seven years, some 10,000 EU citizens have arrived in Ghent from Bulgaria and Slovakia - among whom a majority is estimated to be Roma.

Visual Data

Mediterranean towns ready for EU-sponsored free wifi

The European Union's fund for free wireless internet connection hotspots is most popular in Belgium, Bulgaria, Croatia, Italy, Malta, Slovenia and Romania. Check if your municipality pre-registered.

Magazine

Decision day for EU agencies relocation race

EU ministers will decide on the future location of two London-based EU agencies on Monday. In this edition of EUobserver's Regions & Cities magazine, we take a closer look at some of the EU agencies.

Magazine

The EU Agencies Race

In this edition of EUobserver's Regions & Cities magazine, we take a closer look at some of the EU agencies, exploring how their location matters and the benefits for cities and regions to host them.

News in Brief

  1. EU investigating BMW, Daimler and VW 'collusion'
  2. Spain wants special Gibraltar chapter in Brexit deal
  3. Italy cancels Vienna talks over South Tyrol 'dual citizenship'
  4. Britain will not accept Brexit deal with Irish Sea border
  5. Slovakia seeks witness to journalist killing
  6. Finland's Stubb considers running for EU commission job
  7. Romania ponders anti same-sex marriage referendum
  8. EU lawyers back Slovenia in Croatia border dispute

Magazine

The EU Agencies Race

In this edition of EUobserver's Regions & Cities magazine, we take a closer look at some of the EU agencies, exploring how their location matters and the benefits for cities and regions to host them.

Stakeholders' Highlights

  1. NORDIC COUNCIL OF MINISTERSThe Nordic gender effect goes international
  2. NORDIC COUNCIL OF MINISTERSPaula Lehtomaki from Finland elected as the Council's first female Secretary General
  3. NORDIC COUNCIL OF MINISTERSNordic design sets the stage at COP24, running a competition for sustainable chairs.
  4. Counter BalanceIn Kenya, a motorway funded by the European Investment Bank runs over roadside dwellers
  5. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  6. IPHRCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  7. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  8. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All
  9. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  10. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  11. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  12. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want

Latest News

  1. EU promotes 'Egypt model' to reduce migrant numbers
  2. Tensions mount over Kosovo-Serbia deal
  3. New book: Why war is coming
  4. EU parliament will not budge on office expenses
  5. Why Orban's project to reshape EU politics will be unsuccessful
  6. 10 years after Lehman Brothers what has changed for EU consumers?
  7. Sefcovic launches bid to be EU Commission president
  8. Is Russia blackmailing the Council of Europe?

Join EUobserver

Support quality EU news

Join us