French regions back status quo on EU funding

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French regional leaders have urged EU policymakers to maintain cohesion funding at current levels or risk throwing Europe back into recession. 

Their intervention comes as the EU institutions gear up for tough negotiations over the future shape and size of the bloc's regional policy after 2013, when the current funding period comes to an end.

Stakeholders are jostling for position ahead of the likely unveiling of a blueprint for the next funding period (2014-2020) by Regional Policy Commissioner Johannes Hahn by the end of June. 

Members of the European Parliament's regional policy (REGI) committee recently backed plans drawn up by the European Commission to divide Europe's regions into three groups, according to their level of wealth, by creating a new category between the poorest and most prosperous areas.

MEPs want to make sure that the Commission addresses the needs of regions whose level of GDP per person falls between 75% and 90% of the EU average by introducing the category of 'intermediate regions'.

The idea – first proposed by the EU executive in its Fifth Report on economic, social and territorial cohesion, published at the end of last year – would replace the 'phasing-out' and 'phasing-in' mechanisms which are part of the current system for deciding how much money each region can receive from the EU's structural funds.

Official EU statistics show that some 50 regions, with a combined 72 million inhabitants (14% of the total EU population), could qualify for inclusion in the new intermediate category.

'Don't cut budget'

But French regional leaders – in Brussels this week to defend the current system and warn EU policymakers that creating the new category risked slashing aid for their regions – cautioned that cohesion funding must continue to support all Europe's regions if the continent is to continue to recover from recession.

"We're not budget eaters, but we want to maintain funding at current levels," Jean-Yves Le Drian, vice-president of the Association of French Regions, told journalists ahead of a meeting with key EU decision-makers on Tuesday (31 March).

"Keep the European Social Fund, treat all regions equally and move towards increasing EU cohesion funding under the 'Europe 2020' strategy," Le Drian urged policymakers.

"Our biggest worries are that funding for cohesion policy will be reduced and certain regions will not be recognised," said Le Drian, who is also president of Brittany.

"We are in a crisis and reducing cohesion funding would be the wrong thing to do," added Sandrine Rousseau, vice-president of France's Nord-Pas de Calais region.

Others warned that reducing EU regional funding is "exactly the opposite of what we should be doing" at a time when Euroscepticism is growing throughout the bloc.

"Populism is mounting across EU member states and it is regional funding that brings Europe closer to its citizens," said Jean-Claude Gayssot, vice-president of French region Languedoc-Roussillon.

'Justice and solidarity' at stake

He was echoed by Gérard Vandenbroucke, vice-president of Limousin, who warned that "justice and solidarity" are at stake in the upcoming reform. "Without that, we will see more Euroscepticism and lower turnout in EU elections," he predicted.

Danuta Hübner MEP (European People's Party), who chairs the Parliament's REGI committee, told EURACTIV that she supports the idea of a new intermediate category because this would ensure that all regions facing similar challenges are treated on an equal basis.

She said it was not fair that under the current system, regions with identical levels of wealth, as measured by GDP per person, can receive very different levels of support from the European Regional Development Fund (ERDF) and other EU funds.

Under the 'phasing-out' and 'phasing-in' system, regions that were previously considered poor are entitled to extra financial support for several years after their economic situation has improved, to ensure a kind of 'soft landing'.

Currently, a former 'convergence' region is eligible to receive up to seven or eight times as much money as another region of the same size, with exactly the same level of wealth.

Not everyone in the REGI committee agrees with Hübner, however. German centre-right MEP Markus Pieper (EPP), recently slammed colleagues who voted in favour of asking the Commission to develop proposals for a new category.

Pieper told EURACTIV that the introduction of a new 'intermediate' category could cost up to €20 billion over a seven-year period. He likened the idea to the sleeping car of an overnight train, warning that regions would feel "too comfortable" with such a system in place.

Indeed, with divisions also reported between Commission President José Manuel Barroso – who is pressing ahead with 'intermediate regions' despite the misgivings of some of his colleagues – the fight over the future of EU cohesion policy appears to be only just beginning.  

Andrew Williams

"If the structural funds are going to be used for infrastructure, then there is a need for clear and concrete rules," said Jean-Yves Le Drian, vice-president of the Association of French Regions.

"We know that there will be sectoral funds, that much is certain, so we need to make sure that they work for us," added Le Drian, who is also president of Brittany.

"The debate within the European Commission is still ongoing, so it's all to play for. We came out of our meeting with Barroso perplexed and worried, especially about intermediate regions," said Jean-Claude Gayssot, vice-president of French region Languedoc-Roussillon.

He was echoed by Jean-Pierre Masseret, president of Lorraine in the country's north-east. "We need these funds to prevent us drifting away. But we have huge doubts about the future of cohesion funding," he said.

"We're a small region and EU funding is crucial for us, not to mention very visible to citizens. Any tendency to re-centralise would be very worrying," said Françoise Bely, vice-president of Poitou-Charentes.

Speaking out against the creation of an ‘intermediate regions' category as called for by the European Parliament's REGI committee, German centre-right MEP Markus Pieper (European People's Party) said "we have a proven transitional system with one-time phasing-out rules for former convergence regions".

"A permanent intermediate category would lack any incentive for the funds to be spent efficiently on structural improvements," he added.

"If such a category came true, the basic philosophy of the EU cohesion policy, which is to support the poorest regions, would be lost," he warned.

The regional policy (or cohesion policy) of the European Union has the overall goal of promoting economic prosperity and social cohesion throughout the 27 member states and their 271 regions.

Under the current system, there are two broad categories. The poorest regions, defined as those where the GDP per person is less than 75% of the EU average, are put into the category of 'convergence' regions. All of the remaining regions are considered as 'competitiveness' regions.

The European Commission wants to create a third category for regions that are poorer than average, but not poor enough to qualify as 'convergence' regions. The new category, referred to as ‘intermediate regions’, would apply to regions with a GDP per person that falls between 75% and 90% of the EU average.

  • By end June: Presentation of EU regional policy for post-2013 period by Commissioner Johannes Hahn.  

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