Cohesion
Soaking up a third of the EU’s budget, cohesion funds represent a large and sometimes contentious portion of the collective money pot. Cohesion funds aim to reduce inequalities between wealthier and poorer regions by creating jobs and growth, as well as facilitating the ecological transition. The 18th edition of the European Week of Regions and Cities, which took place in Brussels in October 2020, offered a glimpse of how the money is invested.
Online meetings with entrepreneurs, farmers, project managers and more involved in EU co-funded projects throughout the 28 member states from the current Multiannual Financial Framework (which includes the UK) and neighbouring countries were a chance to zoom in on the diversity of the destinations of financial help. Larger debates, which mostly took place in a hybrid format with speakers and journalists present and an option to join via Zoom for attendees, allowed for a broader understanding of the role cohesion policy plays in the EU today.
“We must not see these funds as expenditure, but as investment,” insisted Commissioner for Cohesion and Reforms Elisa Ferreira in an interview with The New Federalist. Although the EU has limited competences in health policy, somewhat restraining coordination between the patchwork of national policies, cohesion policy has proved its adaptability and versatility during the pandemic so far, allowing for funds to be diverted to regions hard-hit by lockdowns and in need of medical supplies, notably via the Coronavirus Response Investment Initiative and React EU.
Communication
The event is equally an opportunity for the EU to make some noise about its success in this area and generate some much-needed positive coverage in the media. The progressive reduction of between-country inequalities over time is an unquestionably remarkable feat, yet the stories of misuse and fraud (representing less than 1% of total spending on cohesion policy) are disproportionately represented in the media. By inviting journalists to attend the event, and running a programme for young journalists, the EU is encouraging both coverage of, interest in and understanding of EU affairs, all of which are required (in much greater quantities than we see today) to combat widespread Euroscepticism.
In the UK, areas such as Cornwall and West Wales benefitted from cohesion funds at a level comparable to some regions in Romania and Bulgaria. However, the fact that a new university campus in Wales received millions in EU funding was omitted by the local press, while local councils in Cornwall begged the British government to provide replacement funds after the local population voted heavily for Brexit. While not all cases are as extreme as the UK, this example illustrates the communication gap that exists and highlights that further thought is needed to bridge it.
Conditionality
Ah, rule of law conditionality: conspicuous by its absence at this year’s Regions Week. Disappointingly so, for an open discussion on the greatest debate surrounding cohesion policy today would have made the tone of the event less self-congratulatory and more transparent with regard to the challenges faced. In light of the democratic backsliding we are witnessing in several third wave democracies, there have been proposals – from the Commission in 2018 and more recently from the German EU Council Presidency – to make receiving cohesion funds dependent on respecting rule of law and democratic rights within the EU, and ultimately stop illiberal regimes from benefitting from EU funds. As the problem was not addressed at the event, it became rather the elephant in the room.
….and complacency
While inter-country inequalities are falling, and while significant progress has been achieved for regions below the European average in terms of living standards, within-country inequalities continue to grow in many mature democracies in Europe, leaving post-industrial regions in particular exposed to stagnation while wealthier urban regions reap ever-greater profits from flourishing service sectors. It is imperative to avoid complacency and look not only to current living standards but also to future potential when allocating funds: for example, by using other indicators measuring innovation, as well as GDP per capita.
Complacency should also be avoided in terms of branding: though it is not always the case, it is a mistake to portray cohesion funds as an act of generosity. It is certainly an act of solidarity, but it is also of great advantage to the most developed countries to ensure that poorer ones catch up quickly, in order to secure future demand for their export markets and also to guarantee a plentiful supply of sites with cheaper labour and sound infrastructure to which businesses can relocate. Ultimately, from a purely financial point of view, it is very much in wealthy regions’ interests to be net contributors to the cohesion funds now to secure more profit in the future. This should be freely expressed, at the EU Regions Week and elsewhere.
Lastly, cohesion policy must be much more attuned to the longer-term crisis we are facing, and the current negotiations over the shape cohesion funds will take over the next Multiannual Financial Framework must imperatively be brought in line with the Green New Deal. The Just Transition Fund is an excellent start, but the rest of the funding should also be distributed in a way which does not undo the results of this initiative.
Overall…
The EU Regions Week is an excellent place to learn about one of the EU’s most successful policies, and it is right to celebrate the achievements and the diversity of the projects (and, by extension, the citizens) the EU has assisted. It also contributes to more and better media coverage of the EU. But, to make the week even more informative, the event should be less of a celebration and more of a forum for debate, including transparent discussions on the challenges cohesion policy faces. Let’s hope that the EU Regions Week 2021 will evolve in this direction – and cross our fingers hybrid conferences by videolink will no longer be required.
Follow the comments:
|
