The reflection document on the future of EU finances, presented by the European Commission on Wednesday 28 June, provides a significant focus on cohesion policy as an important budget adjustment variable that might have to undergo thorough changes in the next financial framework.
The European Commission is considering all the options and is therefore quite willing to flag up in scenarios 2 and 4, the possibility of exclusively concentrating this policy on the poorest regions and cross-border cooperation. If this option were maintained, it could possibly undermine the fundamental principle of cohesion policy, that of covering all regions. In a reply put to her by EUROPE, the Commissioner for Regional Policy, Corina Crețu, explained that she was against this scenario and that, “What I want is to have a bigger budget and more Europe” and once again expressed a preference for scenario 5.
Conditionalities applying to European funds and respect for the rule of law. Another Copernican revolution is insight: the Commission has mentioned the possibility of applying conditions to the allocation of structural and investment funds involving respect for the rule of law. In its document, the Commission justifies the fact that this measure is necessary for citizens but also for innovation and businesses due to economic implications of a state possessing a democratic deficit. This is a controversial measure, particularly for the regions, which see it as an unfair mechanism that would transform cohesion policy into a “punitive” policy. After the press conference, the Commissioner repeated to EUROPE that she was opposed to this scenario.
Creation of a single fund or single rules. The Commission is also proposing the creation of a single and unique investment fund to replace current funds. It explains that this will be done to strengthen regulatory coherence between the different funds, as well as their coordination with other European programmes, including the Horizon 2020 Framework Programme or the Connecting Europe Facility (CEF).
“Regionalisation” of European Semester. During the press conference, the Commissioner for the Budget, Günther Oettinger mentioned a proposal he had already put forward previously (see EUROPE 11817), namely, improving the accuracy of peer-to-peer recommendations in an effort to take into account regional disparities, whilst remaining in contact with the appropriate regional authorities. In a reply to EUROPE, the Commissioner outlined his proposal by explaining that this regional dimension would only involve certain member states where there were sharp socio-economic disparities (such as in the north and south of Italy) and when regions had strong regional organisations at their disposal. Malta would therefore not be affected by these regional recommendations.
Increasing national co-financing rates and strengthening financial instruments. In the majority of scenarios, the Commission envisages a reduction in the European co-financing rates and increased use of financial instruments. The Commission would therefore like an improved recalibration of co-financing based on the regions and increasing the involvement of member states and regions to ensure that greater responsibility is taken.
New fund allocation criteria. Another major novelty involves the fact that the Commission has taken on board the demands expressed by the regions and certain MEPs (see EUROPE 11787) and will therefore put forward the idea of introducing new structural and investment fund allocation criteria, in an effort to take into account, for example, demographic trends, unemployment rates or the consequences of climate change.
New fund for structural reforms. The Commission would like to strengthen and speed up structural reforms. In this context and in connection with cohesion policy, it would like to set up a “new independent fund” open to all member states. The objective: to support European policies and measures taken by member states in line with the specific recommendations addressed within the European Semester budgetary process.
Synergy, globalisation adjustment and administrative capacity. The Commission has included many other proposals in its document. It is also proposing to rationalise the combination of financial instruments and European programmes (COSME, Junker plan and the CEF) and cohesion policy. In this connection, the Commission is putting forward the idea of merging certain instruments or even “closing programmes”. It is also suggesting that the European Globalisation Adjustment Fund and cohesion policy are brought closer together in an effort to extend the fund’s scope for action. Another proposal on the table: the Commission would in the future like to increase support for regional and national administrative capacity in an effort to improve implementation of structural and investment funds.
On 11 July next, the high-level group working on simplification and steered by former Commissioner, Siim Kallas, is expected to present its report for the simplification of post-2020 cohesion policy. (Original version in French by Pascal Hansens)