The second European Commission report on economic and social cohesion and the elements placed on the table by Commissioner Michel Barnier, responsible for the issue (see this section in yesterday's EUROPE), provide food for thought
Money isn't everything. The funding of the Structural Funds is but one aspect of the policy aimed at economic and social cohesion and the reduction of regional disparities that are still substantial in the EU of 15 and will radically worsen in a Union of 27. We tend to place too much emphasis on the amount of the aid, whereas money alone may be an element of distortion, encouraging organised crime in certain areas, leading to the support of dubious projects with the aim of not losing available funds, etc...Statistics show us that certain areas that have received very large subsidies have not taken off, whereas otherS do so will less aid. Other factors than money are likely to have a greater impact. Community policies may be defining: common agricultural policy, employment policies, research, transport, training and (fundamental) competition policy. And especially, the dynamism of the regions concerned, resistance to organised crime, the choice of projects and the way they are monitored have at least as much importance as the volume of aid. Mr. Barnier, moreover, expressed the wish that the link between money provided and results secured be enhanced (presently, the "performance reserve" amounts to hardly 4% of credits granted to each Member State). Convergence is the result of actions and policies; it does not consist (as Barnier says) of handing out cheques.
Central regions too… A better distribution of economic activity throughout the Union is in the interest not only of regions lagging behind in development and peripheral regions but also of central regions where the activity is concentrated (almost half the Community revenue is produced in an area covering a seventh of the Union's surface area). The report comments: "this concentration has negative consequences not only for peripheral regions but also the central regions themselves, especially regarding traffic congestion and pressures on the environment and health, that, in the long term, could annihilate the apparent advantages."
An allocation to negotiate, but a necessary minimum. The Commission's report contains no quantified figures as to what could be the allocation to the cohesion policy for the period 2007-2013. According to certain indications, Barnier was in favour of this report not neglecting that aspect, but the Commission as a whole found it preferable that the debate should first concentrate on the principles and guidelines. Mr. Barnier nevertheless stressed that maintaining the percentage of Community GDP devoted to cohesion in 1999 (0.45%) represented the "necessary minimum". Which, for a Union of 27, would represent some 45 billion euro a year. He also estimated that 70% of the total allocation should, like today, be reserved for regions lagging behind in development (but partially altering the method used to assess whether an area belongs to that category). The financing modalities for regions in decline or undergoing reconversion, on the other hand, will have to be radically altered, leaving greater responsibility in the hands of Member States and regional authorities.
Less integration, less solidarity. The scale of the financial effort that Member States will be to consent will, in my opinion, largely depend on the "post-Nice" debate. Should the EU move towards increased integration, solidarity will be strengthened and the "net contributor" countries more generous. But in a Europe increasingly governed by the intergovernmental method and the right of veto, it would be an illusion to believe that the miracle of the two "Delors packages" could occur again. European funding of the cohesion policy (nor, moreover that of the agricultural policy) could not continue. There would be a certain amount of joint spending; but European funding of entire policies wouldn't stand a chance (nor would there be reason for it) to persist.
There is a sketch of the stakes of the negotiations that we are embarking on. The first element was the Commission's document, with the interventions by Mr. Barnier. The second will be the "Forum on Cohesion" that the Commission is organising in Brussels on 21 and 22 May and which will be followed by wide-ranging reflection and a broad debate, with the participation of all the institutions, Member States and candidate countries, "civil society". And, in 2004, the Commission will present its formal proposals.
(F.R.)