The EU's budget commissioner has come out strongly in defence of cohesion policy, telling EurActiv France that Europe needed to go beyond austerity measures to support growth in the most deprived regions.
Janusz Lewandowski is budget commissioner at the European Commission. He spoke to EurActiv.fr's Marie Herbet.
Are you surprised with the divide that's emerged during negotiations for the 2014-2020 budget between the advocates of budget cuts and those of regional policy ?
As always, the rules of the game in the EU is compromise.
You have to satisfy everyone, in a constrained context. We can not really afford to extend the EU budget, even if the Lisbon Treaty gave new competencies to the EU, and that we welcome Croatia as a new member of the family.
You have to know that between 2000 and 2011, the European budget increased a lot less than that of the [member] states – by 41.7% compared to 60% for most national budgets.
How do you react to the threat of some northern states to cut regional policy funding?
It is not compatible with the political announcement by the European Council in June. We know that we need to find hope for the future, and that this hope comes from a growth pact, non only from a fiscal pact.
In these times of austerity, we don't have other resources other than structural funds. They are a typical example of the investment that creates a multiplier effect.
But some announce a growth pact one day, and the next day cuts to the cohesion budget. There is an absolute contradiction. We will not be able to have a suitable policy on employment and competitiveness without structural funds and rural development funds.
Agriculture policy continues to consist mainly of direct subsidies to farmers. Is this a growth policy?
The CAP now includes additional requirements aimed at sustainable development. And we need to maintain direct payments by hectare.
When prices were low, in 2009, this aid made up on average half the farmers' revenues.
But what we need is investment. These will come from regional policy, rural development and the Connecting Europe Facility for (transport, energy and telecommunications, that will attract long-term financing from the the private sector.
The priority for France is to maintain aid to farmers, even if this means making savings in other policy areas such as cohesion...
It is unforgivable. The problem of direct aid is very sensitive in France, I'm aware of that. But we should make aid intensity converge between European countries.
Those which received the least until now, like the Baltic States, should receive more, while those who received more than average will lose up to 7%. This is the case of the Benelux.
But there is flexibility between the pillar of direct aid and that of rural development aid. If the political choice of France is to maintain direct aid, it could do it by reducing part of the rural development funds.
I know that you have to take into account the position of the big countries, like France, but balance is a key problem. If they are applied, the cuts need to affect everyone.
The Commission has hailed public budget cuts in the member states, considering that this will allow them to reduce their deficit. But it also asks them to keep the EU budget intact. Is that not a paradox?
In most countries, the budgets have gone up in nominal terms [outside inflation: Editors' note]. For our part, we defend the multi-annual financial framework in real terms, on the basis of the 2013 levels, taking inflation into account.
We are coherent, especially in terms of administrative costs. In France, public administration costs €50 billion, against €8 billion for the EU.
And, for the first time, in 2013 there should be fewer jobs in the European civil service than in 2012. This is the promise I make.
What will happen if the member states are incapable of finding an agreement at the European summit on the budget at the end of November?
There will be a hole in investments. This means that we will not be able to launch a new generation of programmes for European funds in 2014.
For regions like Andalucia, Wales or even Eastern Poland we cannot afford it. It would be harmful, we need perspective and ongoing investments.
For local and regional authorities, it is very important to be able to count on the stable promise of of European funds. They already plan their future investments. It's essential for growth and jobs.