Breweries, bakeries and brides: Where Italy spent its EU billions

Wedding dress makers were one of the surprising recipients of EU structural funds. [Office of Public Affairs/Flickr]

The EU promised the south of Italy billions to promote research and innovation, but, as EURACTIV Germany reports, the money was spent on some strange projects…

What do a bridal wear outlet in Puglia, Fiat, mobile provider Telecom and a Calabrian cinema all have in common? The answer is quite simple: EU structural funding support.

Between 2007 and 2013, Brussels pumped around €6 billion into the south of Italy, money that was intended to support “research and innovation activities in the four regions of Puglia, Calabria, Sicily and Campania”, so as promote “social and economic development”.

Around €300,000, plus a further €100,000 of money from Rome, was provided to the Calabrian town of Marzi, in the toe of Italy. The small settlement is the hometown of award winning cinematographer Mauro Fiore, who took home the Oscar in 2010 for his work on the immensely successful film Avatar.

To capitalise on the success of their most famous son, Marzi proposed to build a centre for cinematography and filmography. The money arrived, but the cultural centre, two years past its proposed construction date, is still not finished.

But it is not simply a question of when the building will be completed, more fundamentally, it is a question of whether Marzi would actually benefit economically from the centre.

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It is not the only example of odd uses of EU money, as demonstrated by Italian magazine Le Scienze, which carried out a study under the title European Funds, Italian Mysteries.

Research into how EU funding is actually used in the south yielded some curious results. Money intended to promote research and innovation ultimately ended up supporting, among others, bed and breakfast owners, car washes, mattress makers, breweries, retirement homes, bakeries, mills, bridal wear outlets, furniture makers and mineral water bottlers.

It is also not unheard of, according to the study, that the projects in question cannot be evaluated, as the funds are sent to one-man operations with no internet connection or they are registered at addresses that don’t exist.

Le Scienze also found that major banks, universities and large-scale companies, like Fiat, have benefitted from the funding. Ultimately though, the positive effects of the money are often not apparent.

Eligibility criteria, how the billions are distributed and evaluating how the funds are used are not the responsibility of the European Commission. Instead, it is the Italian government, through its education, research and economic development ministries that decide. When Le Scienze gave those authorities the chance to respond to its findings no answer was forthcoming.

According to German MEP Inge Gräßle (EPP), who is chair of the European Parliament’s Committee on Budgetary Control, the EU only partly verifies the projects. Gräßle added that Italy, one of the founding members of the EU, has regularly fallen foul of EU budget implementation rules over the last two decades.

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At the end of 2013, the European institutions agreed on a reform of structural funds for the 2014-2020 period, under the leadership of then Commissioner for Regional Policy, Johannes Hahn. The agreement was “a big step forward on the way to giving the EU the necessary tools to strengthen the European economy,” said Hahn at the time.

Structural funding totals some €325 billion, with cohesion funds on top; €80 billion has been made available for research and innovation.

One of the main improvements made by the reform is that member states must now make it clear what goals and targets have been achieved through the funding, as well as being obligated to measure implementation progress.

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