European Parliament members have endorsed the idea of dividing Europe's regions into three groups, according to their level of wealth, by adding a new category between the poorest and more prosperous regions. 

Members of the European Parliament's regional development (REGI) committee voted yesterday (26 May) in favour of a compromise put forward by the Socialists & Democrats (S&D) group.

The amendment was supported by 27 of the MEPs who took part in yesterday's meeting, with 18 voting against.

According to the adopted text, the Parliament will call on the European Commission to table proposals to address the needs of regions with a level of GDP per person that falls between 75% and 90% of the EU average.

Supporting 'intermediate' regions

The proposed new 'intermediate' category would replace '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.

The REGI committee was voting on a report on the future of the EU's cohesion policy after 2013, drafted by German centre-right MEP Markus Pieper (European People's Party).

In the final vote, 31 MEPs voted in favour of the text, including amendments, with four against and nine abstaining.

The report represents the Parliament's official response to the Fifth Report on economic, social and territorial cohesion, which was published by the European Commission at the end of last year.

The amended text is due to be debated and voted on by the whole European Parliament during a so-called 'mini-plenary' session in Brussels on 22 or 23 June.

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.

Danuta Hübner MEP (EPP), 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.

Commission urged to act

Hübner agrees with the majority of her colleagues that the Parliament should ask the Commission to consider how the needs of different types of regions could be addressed in a way that is based on objective and transparent criteria.

"We expect the Commission to come forward with a proposal that sets out all the consequences [of introducing an intermediate category], including the budgetary and legal consequences," said the Polish MEP.

Hübner, who was the EU commissioner in charge of regional policy from 2004 until 2009, believes that the introduction of a new category would not require any extra money, compared to the current budget for cohesion policy which is around €50 billion per year.

The former commissioner promised "huge savings" resulting from a reduction in the number of convergence regions between the current funding period and the next one, which is due to start in 2014.

The money which would otherwise have been used to finance a 'phasing-out' mechanism for around 20 former convergence regions, should – according to Hübner – instead be shared more evenly among a greater number of regions.

The result of yesterday's vote was warmly welcomed by members of the Socialists & Democrats (S&D) group in the European Parliament.

MEPs Constanze Krehl (Germany) and Giorgos Stavrakakis (Greece) described the proposed new intermediate category as "fair, transparent, based on solidarity and justified".  

The president of the EU Committee of the Regions (CoR), Mercedes Bresso, also welcomed MEPs' support for the introduction of a new category for 'in-between' regions.

"The creation of this 'intermediate' category in EU regional policy is a key demand of the Committee of the Regions," said Bresso.

"In our view, such a new funding category must cover all regions whose gross domestic product is between 75% and 90% of the EU average," she continued.

"I am happy that a majority in the EP's regional development committee supports this approach, which would guarantee equal treatment of all concerned regions, regardless of their current funding status."

Rapporteur dismayed by outcome

However, the German centre-right MEP who drafted the original text was quick to criticise colleagues who had voted in favour of the idea of asking the Commission to develop proposals for a new category.

Markus Pieper told EURACTIV that the introduction of a new 'intermediate' category could cost up to €20 billion over a seven-year period.

The EPP member compared the proposed new category with the sleeping car of an overnight train, and warned that regions would feel "too comfortable".

"We have a proven transitional system with one-time phasing-out rules for former convergence regions," said Pieper.

"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.