Governments break EU rules, plan cohesion spending without partners

Several European governments are breaking EU rules that require meaningful consultations with local authorities and civil society in planning cohesion spending, stakeholders have complained, while the European Commission says everything is, mostly, in order. [Shutterstock/Bacho]

Several European governments are breaking EU rules that require meaningful consultations with local authorities and civil society in planning cohesion spending, stakeholders have complained, while the European Commission says everything is, mostly, in order.

With a firepower of €330 billion, cohesion is second in budget size only to the agricultural policy outside of the money borrowed for COVID recovery from the markets.

However, planning for the 2021-2027 budgetary period of the EU’s long-running structural investment programme, meant to decrease disparities between the bloc’s regional development levels, is now significantly delayed because recovery money has already maxed out the administrative capacity in many member states.

COVID recovery euros slow down EU structural fund planning

As predicted, recovery money planning has maxed out administrative capacity in many member states at the expense of the EU’s long-standing structural investment program, which now faces delays.

On top of that, local and regional authorities, as well as NGOs, are now sounding alarm bells, saying they are being sidelined illegally by their national governments.

From 2014, including stakeholders such as trade unions, local governments and civil society in coming up with programs under cohesion policy, the so-called partnership principle, is no longer simply a long-standing practice but a legal obligation.

However, players across the board are now saying that European capitals are shirking on this responsibility.

According to new data compiled by Climate Action Network (CAN) and CEE Bankwatch Network NGOs, out of the ten countries where they have active members, only two complied fully with requirements of the EU rules on public consultation process when preparing their partnership agreements, the basic framework documents.

Moreover, overall compliance does not improve even when looking at consultations surrounding specific plans that detail EU-backed investments, called operational programs.

Local and regional governments have also said they are not being adequately engaged.

During its October plenary, the Committee of the Regions, a 329 member-strong EU advisory institution made up of regionally or locally elected politicians, warned against poor involvement of regions and cities in new cohesion policy programmes.

The sentiment is also echoed by the Council of European Municipalities and Regions (CEMR), an association representing subnational authorities.

Structural funds will have to be implemented alongside the €672.5 billion Recovery and Resillience Facility (RRF), the centrepiece of EU-COVID cash tap, which will disburse €312.5 billion in grants alone by 2026, a sum comparable to the entire cohesion policy budget.

Meanwhile, the classical cohesion instruments only need to be spent by 2029, leading to what critics fear will lead to a prioritisation of recovery fund spending and empty cohesion project pipelines.

Cohesion, recovery funds clash causing headaches for regions

Critics are warning of significant delays in the EU’s cohesion policy spending following the adoption of the bloc’s long-term regional support plan, while stakeholders say more time is needed at the local level to devise spending strategies for recovery aid …

“Respect of the partnership principle is maybe even more important this year with the parallel programming of the RRF for which member states did not consult the relevant stakeholders such as municipalities and regions,” CEMR told EURACTIV in emailed comments.

“Partnership Agreements could help ensuring consistency between RRF and cohesion fund, but the main difficulty is that they are not implemented by the same ministries/managing authorities,” the association added.

CEMR said in some cases, local players were involved in planning some fund programmes but not others, and there was no consistency even within the same countries, as the degree of effective involvement often depended on each minister.

Treating COVID 'symptoms' without facing past may risk green future of regions

Many EU governments appear to be ignoring regional and local authorities in the design of their national recovery plans, and they risk uneven recovery and slower green transition if existing issues in most vulnerable regions are disregarded, experts say.

Meanwhile, green NGOs have warned that the secrecy will lead to poorer climate spending of cohesion money, where at least 30% of European Regional Development Fund and Cohesion Fund’s (ERDF/CF) €242.9 billion will have to be spent on greening.

“The cohesion policy funds are the second-largest chunk of the EU funds and could play a key role in tackling the climate crisis and ensuring a just and sustainable transition of the EU economy. Yet, they are being planned behind closed doors,” said Olivier Vardakoulias, finance and subsidies policy coordinator at CAN Europe, a grouping of climate NGOs.

Respected principle or collision course? 

Christophe Jost, a senior EU policy officer at CEE Bankwatch, said EU countries “are on a collision course with the Commission over Cohesion, because stakeholders have been sidelined and kept in the dark during the programming. This is a clear breach of EU law.”

Meanwhile, the Commission painted a much better picture of the situation.

The EU executive told EURACTIV it has just started formally receiving the relevant documents, “so it is too early to judge the quality of the process overall, as in some member states the consultation process still needs to unfold.”

However, “a preliminary assessment suggests that the partnership principle has been generally respected so far, although in some members states the approach still has room to improve.”

Nevertheless, the Commission promised it was “going to ascertain itself that the partnership principle has been respected before approving programmes submitted” by EU countries.

[Edited by Zoran Radosavljevic]

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