Brussels, 15/09/2014 (Agence Europe) - The Committee of the Regions (CoR) has added to the call and, in its turn, urged greater flexibility in the interpretation of stability and growth pact rules. European regions' investments made to release joint funding from the structural funds should not be taken into account when calculating budgetary deficit, says the CoR.
In a statement adopted on 12 September, the CoR urges European decision-makers to exclude from deficit calculations any investment made as part of cohesion policy and likely to create growth and jobs. CoR President Michel Lebrun (EPP, Belgium), said: “In the current economic situation, regions' and cities' productive investment should not be subject to the Growth and Stability Pact ceilings”. “Local and regional authorities should instead be supported in promoting a low-carbon economy and sustainable urban development”, he added. The importance of not putting off or of cancelling the investment is all the greater as, since 2010, direct investment by local and regional authorities has fallen by more than 20%.
The call from the regions for increased flexibility in deficit calculation will be submitted to the European Parliament and the Council of the EU, ahead of the European summit on growth, scheduled for 20 October. The CoR is, thus, supporting the efforts of the Italian Presidency in this area (see EUROPE 11150). A lighter touch in the application of the stability and growth pact with regard to the structural funds would be a decisive first step towards recognising the need for greater flexibility in the way some kinds of expenditure is regarded.
However, even within the CoR, coming to agreement around this idea is by no means easily accomplished. Discussions have been continuing for several years, though the experiences on the ground of these last few years would seem to have made the difference, a European source said. Piero Fassino (EPP, Italy), the mayor of Turin, where the statement was signed, and president of the Italian Cities Association, was hugely influential in helping to reach agreement. His city has always been a fine example in the absorption of European funding, demonstrating the appetite of the regions, including the best performing, for this flexibility. (MD)