While all of Europe is reeling from the coronavirus pandemic, the crisis undeniably has a strong territorial dimension. Some localities and territories are more severely affected and different regions are not equally well equipped to deal with such a rapidly propagating virus. There is unbearable pressure on hospitals and health services, most severely in areas such as northern Italy, Spain, northern England, or eastern France.
Municipalities and regions are at the forefront of this crisis, whether in enforcing lockdowns, continuing to provide essential public services – above all healthcare and support for the most vulnerable – or in leading the gradual relaxation of containment measures. At the same time, many of their sources of revenue are falling due to the closure of public facilities and the general economic slowdown.
The European Commission has taken steps towards addressing these challenges by creating the Coronavirus Response Investment Initiatives (CRII and CRII+). These will provide unspent cohesion funds to finance medical assistance and economic and social support to fight the pandemic.
The new rules feature some welcome flexibility. Member States will be able to redirect money from the European Regional Development Fund (ERDF) towards the priorities they identify, such as direct support to SMEs. They will also have the option of transferring money between different thematic priorities and cohesion funds.
In this difficult moment, we are fortunate to be able to build on solidarity and cooperation between European regions. This is what European Cohesion Policy is all about.
Improving the Coronavirus Response Investment Initiatives
However, there continue to be obstacles to the rapid and smooth implementation of the new measures and the EU’s territorial response to coronavirus could be improved. In particular, the rules of audits and control need to be drastically relaxed to allow the Managing Authorities to make rapid and secure use of these measures. The controls on state aid, public procurement, traceability, justification of expenses and eligibility of beneficiaries must be adapted to the new needs and the emergency situation created by the crisis.
The possibility of transferring funds between categories of regions should be solely motivated by high local or regional impact of the current health, social and economic crisis. Otherwise, there is a risk that funds will be recentralised at the national level at a time when Member States are defining how they will work with the local and regional level for the next budgetary period.
The impact of the COVID-19 crisis on the local and regional level is tremendous and the proposed support will not be sufficient to address it completely. What’s more CRII and CRII+ will only use unallocated cohesion funds from the previous spending period and hence the money available in various countries will not necessarily be proportionate to COVID-19’s impact there.
At CEMR, we strongly believe the European Commission and Member States should explore additional possibilities to support municipalities and regions. The Commission in particular should consider extraordinary measures for 2021 in order to ensure continuity of the response to the economic and social challenges that are only beginning to emerge.
The EU’s long-term response
We can’t go back to business as usual. We need a long-term budget and strategy to be prepared for future pandemics and crises.
Member States are struggling to contain the pandemic because of a structural lack of investment in critical sectors. This shows more than ever the need for a strong Cohesion Policy, which is not designed to respond to an urgent crisis situation, but rather to structurally strengthen regions’ social and economic development (including health and climate action) through long-term planning.
This crisis has also shown that European states have failed to ensure their collective capacity to respond to such a situation. We will need to rethink our model of development, so that our continent can provide for our basic needs and not be dependent on others when it comes to safeguarding the health and life of Europeans.
Without an agreement on the EU’s next long-term budget, we will not have the resources to answer the dire needs of citizens and the territories most affected by the crisis. I urge legislators to promptly reach an agreement for an ambitious Multiannual Financial Framework (MFF). This must provide the necessary funds to dampen the COVID-19 crisis’ short- and medium-term socio-economic impact and promote robust territorial, economic and social cohesion in all Member States and regions.
Municipalities and regions have a wealth of experience and expertise of practical management in our territories. As such, to ensure CRII and CRII+ can be swiftly and practically implemented, we call on Member States to include their country’s associations of local and regional governments in the reflection on how to implement these new measures. The associations will be able to identify the remaining barriers to the full application of the CRII and CRII+. At European level, the Council of European Municipalities and Regions will both collect and share information on the effective implementation of CRII and CRII+ in different Member States.
We must do all we can to help those in need and put an end to this pandemic. The need for a vigorous immediate response should not however make us lose sight of our long-term goals: resilient and equitable societies founded on sustainable development. A strong Cohesion Policy is needed more than ever to make sure all of Europe’s territories can thrive and look to the future with confidence.
Frédéric Vallier is the Secretary General of the Council of European Municipalities and Regions, the pan-European organisation representing national associations of municipalities and regions.