July 23. 2024. 1:05

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Regions committee’s Cordeiro: Centralising cohesion policy could ‘kill’ the EU project

As EU policymakers mull a reform of the EU’s cohesion policy that could see regional governments disempowered, Vasco Alves Cordeiro, president of the EU’s Committee of the Regions (CoR), issued a strong warning against this in an interview with Euractiv.

The debate around the bloc’s cohesion funds – also called structural funds and historically accounting for about a third of the overall common budget – has taken centre stage recently as many in Brussels call for better implementation while trying to find viable ways of financing new EU priorities, such as defence.

Meanwhile, legislators’ appetite for extending the more centralised and “performance-based” model of the EU post-pandemic recovery fund (the Recovery and Resilience Facility, or RRF) to cohesion has increased. Two sources told Euractiv that virtually all the Commission’s departments except for the regions’ unit (DG REGIO) would see the shift favourably.

However, the Portuguese president of the CoR, the body that groups the main beneficiaries of cohesion money – regional and local governments – warned that “Cohesion policy is the one that makes Europe happen in local communities [and] in rural communities.”

A reform that would see national governments distribute the funds instead of regional ones “will kill cohesion policy, and ultimately, it will kill the European project,” he added.

The EU official noted that policies to integrate and level up happen among member states and at the level of communities. Making it akin to the RRF would be “a mistake because what the reality has demonstrated to us is that in key issues, the RRF fails to have a territorial, place-based approach to the challenges,” he said.

Some in the policymaker community have called for extending the programme beyond 2026 and turning it into a permanent joint EU funding resource, prompting critics to warn against its existing inefficiencies.

Cohesion funds, which are instead part of the regular EU budget, are not immune from scepticism as some argue their allocation has stopped short of yielding the intended results over the years and would, therefore, warrant a rethinking.

“We all recognise that cohesion policy has to go through changes to better deliver its objectives,” Cordeiro acknowledged. This could include merging the multiple funds that comprise the Cohesion Policy framework, such as the EU’s Regional Development Fund (ERDF), Cohesion Fund, European Social Fund, and REACT EU. “It has too many funds,” he said.

However, he also stressed that positive outcomes of cohesion policy are often neglected.

“Even right now, with this place-based approach, you already have some difficulties for people to understand the impact that the European Union has in their daily lives,” he said.

‘Cohesion policy is not charity’

Both calls for a reform of cohesion policy and warnings against cuts have mushroomed over the last few weeks as the EU sets its priorities for the next five-year legislative term and prepares for the next seven-year budget period—which formally only kicks off in 2028.

Experts take particular aim at the fact that cohesion money—such as through the biggest fund, ERDF—is distributed to all regions, not just poor ones.

Cohesion spending should be “better targeted at the lagging regions,” the OECD’s deputy secretary-general Fabrizia Lapecorella said earlier this month, a call echoed by observers in Germany, the largest net contributor to the EU budget.

Cordeiro, however, argued that this criticism was based on a “misunderstanding” of cohesion policy.

“Cohesion policy is not a charity policy,” he said, adding that “it’s not intended only to the less developed regions. It’s intended for all regions to [help them] overcome the challenges they are facing […] – it is in the European interest.”

While “not in the same [co-financing] rate, not in the same eligible investments [like poorer regions],” wealthier regions should also be supported in tackling issues like those linked to the decarbonisation and greening of various strategic sectors, such as the transformation of the car industry, he said.

‘DG REGIO is sidelined’

While Cordeiro said that cohesion policy can also fulfil other EU policy objectives, such as strengthening the defence industry, this would depend on whether there was a “convergence of both interests,” he said.

He cited research investment for the drone industry as an example of projects that could be used for dual military and civilian purposes, such as “for the surveillance of maritime areas or forest fires”.

“That’s one of the frontier areas where you could have the convergence of both interests,” he said.

Overall, he was concerned about the Commission’s current “framing” of cohesion policy as linked to “economic recovery and economic convergence” objectives, and on Monday (17 June) urged the EU executive to clarify its position.

He warned that Economic cohesion should not be emphasised at the expense of social and territorial cohesion.

In his warnings earlier this week, he said other issues at stake include the potential centralisation of the cohesion policy and the option of getting rid of an allocated commissioner, a post held so far by his party colleague Elisa Ferreira.

“DG REGIO is completely sidelined as the main institutional framework to take care of cohesion policy,” Cordeiro warned.

“So the letter asks Commission President von der Leyen to clarify this because it’s too important and too impactful to remain somewhere in the shadow,” he said.

Read more with Euractiv

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