"Throwing money at problems does not necessarily solve them," said Barca, general director for development at Italy's Economy and Finance Ministry.
"If institutional requirements or the capacity of local administration are not addressed, then money will not only fail to help but in some cases could even do damage," he warned.
The Italian economist is one of Europe's leading experts on regional development, and was the author of an influential report, published in 2009, that sets out a detailed set of proposals for reforming the European Union's cohesion policy.
Barca's main criticism of the current policy is its lack of quantifiable targets. In particular, little is known of the policy's impact on people's well-being in European regions.
"This is the case when [the money] does not end up in the hands of innovators but instead goes to those very people who have already been badly using national public funds," Barca told EurActiv.cz.
"I do not claim that such practices are widespread," said Barca. "Yet there is a need to set up some conditions for money to be disbursed."
Targets and conditions
Barca believes that the European Commission is right to propose, as it has done in its Fifth Cohesion Report, published in November 2010, that member states should be expected to meet ambitious targets and implement reforms to their national legislation and practices.
"According to the Commission's proposal, each member state will have its own measurable targets and some [related] conditions," he explained.
"Every year, each country will prepare a report in which it assesses the progress towards the targets and [evaluates] the pace of progress and what reasons, if any, are preventing results from being achieved."
Barca considers that payments from the structural funds should be suspended in cases where a member state has failed to meet the conditions it has agreed with the Commission, for example in relation to its national legislation or administrative practices.
"Cohesion policy is financed by EU taxpayers' money so you need to be sure that the funds are being well used," he said, "and if a given institutional change is needed for policy to be effective, the member state must do it".
To help explain how the idea of conditionality can be made to work in practice, the Italian economist mentioned an example from his own country. He said that the European Commission was refusing to provide money for investments in the field of waste disposal, because the Italian government had, until now, failed to show that it had made a series of institutional reforms that it had promised to undertake.
Doubts over carrot-and-stick approach
However, when it comes to measuring and evaluating the impacts and outcomes of investments, Barca does not believe that financial penalties or sanctions should be imposed on member states that fail to reach the targets they have set for themselves.
Barca is also somewhat sceptical about a Commission suggestion that billions of euros should be kept in a special "performance reserve" which could then be used for making bonus payments to reward the best-perfoming member states and regions.
"I think sanctions and rewards for the achievement of outcomes can be decided internally by [each] member state," said Barca. "But the 'performance reserve' is a whole new story with a big question mark."
"The problem is that if we put aside a reserve [of money] over which member states will compete, we must set up some targets which should be comparable and present the same difficulty for everybody," he said. "But how will we find such an amazing indicator?"
Administrative burden
Going further than the Commission, Barca is proposing that there should be an EU Council of Ministers for Regional Policy, bringing together the ministers responsible for regional development in the 27 member states.
He believes that regular meetings would allow the ministers to "issue political recommendations and keep their eye on the Commission, on member states and on regions".
However, Barca insisted that his proposals, if implemented, "would not increase the administrative burden".
"Political recommendations do not interfere with the administrative process," he said.
"Rather, it becomes a fundamental part of the political debate, because journalists can demand explanations from the Commission and member states, who mutually agree the contracts, and the general public finally gets to be well informed about actual outcomes – not just spending!"
