The debates between European Union member states will be fiery when it comes to deciding on the ‘for whom and for what’ of the EU’s future cohesion policy. At stake are “just” a few billion euro for some and/or the others depending on the eligibility criteria to be decided, the objectives to be agreed and the transition mechanisms to be envisaged. These painful issues will be determined by EU’s heads of state and government in upcoming budget discussions. Contrary to the European Parliament, which, in a resolution to be adopted on 7 October, will express its view in favour of a future cohesion policy built around the three current objectives and addressing all the regions of Europe (see page 10), the Council of Ministers has understandably not yet taken a position on the policy’s future. Apart from a few main principles – basing itself on the EU’s 2020 strategy, improving concentration mechanisms on a limited number of priorities and simplification – everything is still to be decided.

There is a joint communiqué, published after the informal meeting of regional development ministers, on 23 April 2009 in Mariánské Lázne (Czech Republic), which clearly states, black on white, that “ministers share the view according to which cohesion policy should be put in place throughout the EU territory”. But this is not an official position and those who agreed on the text – the ministers responsible for regional development – are not the people who will take the decisions when the time comes. The document is careful to underline that it reflects the current state of play “without pre-empting the outcome of the budget review and the following debate on the next multiannual financial framework – without pre-defining a shape of Cohesion Policy after 2013”.

LOTS OF PRECAUTIONS

More recently, it is worth pointing to the conclusions - this time formal ones - adopted by the General Affairs Council, on 14 June ⁽¹⁾.

But the ‘official’ nature of the text – supported by all the delegations – comes hand in hand with redoubled caution about the outlines of the possible future cohesion policy. The reference is no longer about a policy that should be put in place throughout the EU’s territory but a policy that “whilst being concentrated on the least prosperous regions […] should continue to support competitiveness, innovation, jobs and economic, social and territorial cohesion in the European Union”. It is said (very) cautiously – and once again “without prejudice to the future financial framework” – but many people want to see an opening up towards a cohesion policy that continues to tackle numerous EU regions. On a sensitive issue, such as the future of regions in transition (see page 14), the conclusions are even more cautious. The Council “notes that possible discussions should take into account existing transitory regimes, in particular to look to treat regions in similar conditions in a similar way”.

Apart from recognising the need to talk about it, the wording does not really shed light on what the transition regimes could become.

Finally, the text agrees above all that a “common interpretation on the strategic objectives [of the future cohesion policy] and its principles of implementation” are still to be defined. In fact, beyond the general principle that resources must be concentrated on the poorest, the preliminary discussions on the budgetary review ( see page 9)have shown the big gap that exists between member states when it comes to issues that will have a direct impact on the budgetary envelope to which everyone will have a right and on how to spend the money.

BUDGET REVIEW - NATIONAL CONTRIBUTIONS

There is no doubt that the Netherlands, the UK and Sweden will be the troublemakers. They are the most set against the cohesion policy carrying on as it does now. They had already said so during the previous budgetary reform. The contributions that they sent to the Commission during its consultation on the reform of the budget support the idea of a reduced budget for cohesion policy. The resources, they say, must be concentrated on the regions lagging behind in development in the least prosperous member states. “More prosperous member states must shoulder their own responsibilities and allocate funds from their national budgets to the development of their less affluent regions”, explains the Netherlands.

The UK also says that aid from Structural Funds to the richest member states should be gradually eliminated and that “the priority should be that standard ‘competitiveness and employment’ funding is no longer available to richer member states”.

In the same way, Sweden is calling for a policy focused mainly on the ‘new’ member states. For other parts of the EU, “national and regional efforts should be the basis for regional development”. Denmark’s view is along the same lines as it is asking that financial support to the poorest regions should in the future be tied to a country’s wealth “more clearly than today,” whereas “today, nearly half of structural funds are spent in rich countries”. Estonia also sees the need to “reconsider” financing poor regions in rich member states. And the Czech Republic “encourages greater concentration of the EU financial support of the cohesion policy on the less developed member states and their less developed regions”.

By contrast, Italy openly calls for all the regions to be involved in the future cohesion policy “regardless of the average development levels of the member states to which they belong”. Countries such as Spain, Portugal, Finland, Greece (which wants to avoid “discrimination between old and new member states”), Luxembourg, France, Malta and Belgium want the measures to continue to apply to the whole of the EU. Germany is also positioning itself more in this camp.

Everyone agrees that aid should, as a priority, benefit the least developed countries. The GDP/inhabitant criterion to determine the regions concerned is not in question even if some contributions suggest debate about other types of criteria. Some member states, in particular basing themselves on the ‘territorial cohesion’ argument now set down in the treaty, want the future cohesion policy to continue to support the regions with specific characteristics, regardless of their level of development. Finland refers to poorly populated Nordic areas; France to areas with a geographical or natural handicap; Spain to regions with a specific geographical handicap, such as the outermost regions; Portugal to the needs of peripheral states and regions. Cyprus also thinks that territorial criteria – geographical position, insularity and small size – “should be used more explicitly with respect to eligibility and allocation of funds” and Malta believes that islands, irrespective of their level of development, should receive specific support.

But there is no unanimity on the issue. Denmark makes it clear that the concept of territorial cohesion cannot entail an intrinsic right to financial support based on geographical criteria. “The level of wealth and nothing else,” says the country. Similarly, Germany“rejects the idea of including [in the eligibility criteria] purely geographical factors without a socio-economic reference”.

There is also debate about the priority to give to what are called the ‘new challenges’ – climate change, energy, demographics (the conclusions of the 14 June Council say nothing about these). France and other countries are calling for an assessment of the possible contribution of cohesion policy to major energy objectives and the fight against climate change. Austria thinks that support in the wealthiest countries should be used essentially to prepare for these new challenges. But not necessarily to make them investment objectives. Lithuania recognises the importance of these new challenges but thinks that they should not lead to a change in the main objectives of cohesion policy, as set down in the treaty.

Germany is also cautious. There is need to assess how far these challenges have to be dealt with via sectoral policies and, “additionally, if necessary” via the Structural Funds, it says, while pointing out, for example, that current cohesion policy already makes it possible to finance measures to combat climate change. It adds that “the creation of additional eligibility criteria” requires “sound and convincing reasons”. The Netherlands stresses that cohesion policy needs to “avoid trying to do too many things at once” and to focus on reducing gaps in wealth. Portugal warns that including new priorities in cohesion policy “only to maintain financial flows to regions or member states that have already achieved high levels of development” would be unacceptable.

The contributions of member states to the budgetary review are available at ec.europa.eu/budget/reform/issues/read_en.htm

The preliminary discussions on the budgetary review have shown the big gap that exists between member states

Rendez-vous

The Belgian Presidency of the Council is organising an informal meeting of ministers responsible for regional development, on 22 and 23 November in Liège. It will be chaired by Rudy Demotte, the minister president of the Walloon Region and current chairman on cohesion policy issues. When he was in the European Parliament’s Committee on Regional Development in July, he explained that he wanted to focus the debates around two issues: the political priorities of intervention in the future cohesion policy and the maintenance (or not) of the competitiveness objective (previously Objective 2).

In the former case, it will be about “seeing what objectives will have to be reached and to reflect on the way to organise the concentration of themes for intervention”. In the latter case, it will be about considering “for which regions, for which priorities and according to what modalities” an Objective 2 could be maintained after 2013.The Belgian Presidency says that it is making the debate about the future of cohesion policy a priority because it thinks that “cohesion policy is essential for the pursuit of balanced European integration”. This is particularly true, explained the minister president, given the current economic and social context. “For the Belgian Presidency, it is extremely desirable that the EU’s capacity of action through the Structural Funds is maintained and even strengthened. Cohesion policy must continue to be an important vector of support for regional development throughout the EU,” he said.

⁽¹⁾ www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/FR/genaff/115341.pdf