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The EU’s Regional Policy

The EU’s Regional Policy. David Müller Alpeuregio summer school 2012. 1. Regional Policy – Cohesion Policy. Europe and its Regions History of Regional Policy in the EU Why Regional Policy? Terminology: Cohesion Policy/Regional Policy. Europa and its Regions.

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The EU’s Regional Policy

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  1. The EU’s Regional Policy David Müller Alpeuregio summer school 2012

  2. 1. Regional Policy – Cohesion Policy • Europe and its Regions • History of Regional Policy in the EU • Why Regional Policy? • Terminology: Cohesion Policy/Regional Policy

  3. Europa and its Regions 271 Regions in Europe (NUTS 2 level) • Divergences in terms of wealth, competitive- ness, natural and demo- graphic challenges • Different political traditions on “regions” • “Europe of the regions”?

  4. First ERDF Regulation 1975 Main aim of correcting regional imbalances due to: • predominance of agriculture • industrial change • structural unemployment Actions eligibleforupto 50% ofpublicexpenditure, (preferably in national stateaidareas): • investments in smallenterprisescreatingat least 10 newjobs; • investments in infrastructurerelatedtopoint1; • infrastructureinvestments in mountainousareas.

  5. The Reform for the Period 2007–2013 • Strategic Approach: Linking Cohesion Policy to the Lisbon Strategy • New architecture and streamlining of policy instruments • More room for manoeuvre for Member States • Simplification of management and control of structural policies

  6. <50 50 - 75 75 - 90 90 - 100 100 - 125 ³ 125 Differences in development in the EU-27 GDP per head as a % of the community average

  7. GDP per capita in PPS in 2006

  8. Disparities across the European Union *In US, this difference is only 2.5 and Japan 2

  9. Regional Policy – Cohesion Policy • Structural Policy: Umbrella term covering all policies aiming at structural reforms on national and regional level. • Cohesion Policy: Policy of the EU to reduce the economic disparities between the regions using diferent funds, following shared management rules (TFEU Art. 174). • Regional Policy: Part of EU‘s Cohesion policy with the main instrumtents ERDF and CF (but not the ESF!).

  10. Instruments of Cohesion Policy Cohesion policy interventions through 3 main policy instruments: • European Regional Development Fund (ERDF; based on Art. 176 TFEU; Regulation 1080/2006) • European Social Fund (ESF; based on Art. 162-164 TFEU; Regulation 1081/2006) • Cohesion Fund (based on Art. 177 TFEU; Regulation 1084/2006) Further legislation: • European Grouping of Territorial Cooperation (EGTC; Regulation 1082/2006) Source: EU Commission, DG Regio

  11. European Regional Development Fund Eligibilty • Convergence Regions: GDP/capita < 75 % of the EU25-average. • Competitiveness Regions: GDP/capita > 75 % of the EU25-average • Phasing-in/Phasing-out as transitional provisions for former Objective-1 regions. Territorial cooperation Funding of a) cross-border, b) transnational and c) interregional cooperation and networks (e.g. “Urbact”). Source: EU Commission, DG Regio

  12. European Regional Development Fund Scope of the funding: • direct aid to investments in companies (in particular SMEs) to create sustainable jobs • infrastructures linked to R&I, telecommunications, environment, energy and transport; • financial instruments to support regional and local development and to foster cooperation between towns and regions; • technical assistance measures Broader scope for Convergence regions (11 priorities).

  13. European Social Fund Support of the ESF for Convergence regions as well as for Competitiveness regions. Scope of funding: • Adaptability of workers and enterprises • Access to employment for most vulnerable • Social integration of disadvantaged people • Enhancing human capital (special focus on education system in Convergence regions) • Promoting partnerships and stakeholder networks • Strengthening administrative capacities (conv. reg.) Source: EU Commission, DG Regio

  14. Cohesion Fund Eligibility: MS with less than 90 % GNI/capita on national level (EU-12 + GR, PT, ES). Scope of the funding: • trans-European transport networks, priority projects of European interest as identified by the Union; • Environment (including energy efficiency, renewable energy and transport projects outside of TEN e.g. public transport) Macro-economic conditionality (Art. 4). Source: EU Commission, DG Regio

  15. Management and Control Management/control bodies on MS‘s level • Management authority: management and implementation of OP; annual reporting. • Certification authority: certification of payment requests and compliance of expenditure. • Auditing authority: independent authority responsible for auditing of each OP; annual reporting. • Monitoring committee: Stakeholder committee for each OP to monitor quality of implementation

  16. EU Budet 2007-2013 (at current prices 2012)

  17. Distribution of Budget. Overview • Convergence regions: 81.9% • Competitiveness regions: 15.7% • Territorial co-operation 2.4% Total budget €347bn, which will unlock up to €700bn of direct investment.

  18. Convergence objective (Regions > 75% in EU25) Objective 'Regional Competitiveness and Employment' Geographical Eligibility for Structural Funds Support 2007-2013 Convergence objective statistically affected regions Objective 'Regional Competitiveness and Employment' Phasing-in regions, "naturally" above 75% Index EU 25 = 100

  19. Adaptability of workers and firms Social inclusion Capacity building Technical assistance Fields of Investment European Regional Development Fund and Cohesion Fund (€271 billion) European Social Fund (€76 billion) Employment Environment Transport Human capital Research/Innovation Information society Tourism Social infrastructure Culture Energy Institutional capacity

  20. Regions eligible for cross-border cooperation Territorial co-operation Source: EU Commission, DG Regio

  21. European Territorial Cooperation • Eligibility • Cross-Border Cooperation: NUTS 3 level regions are eligible, along all the land-based internal borders and some external borders, along maritime borders separated by a maximum distance of 150 km (1,8 % of budget). • Transnational Cooperation: all the regions are eligible but, in consultation with the Member States, the Commission has identified 13 cooperation zones (0,5 % of budget). • Interregional Cooperationand setting up networks and exchanges of experience: all the European regions are eligible (0,1 % of budget).

  22. Investment in Growth and Jobs? • Cohesion policy provides for > 50% of public investment in 9 MS, mainly on key domains of EU interest (transport, energy, R&I, SME, etc.) • € 17 bn. reprogrammed since 2007 in reaction to crisis • 2012: Barroso Initiative: reprogramming of € 7 bn. focused on growth and job creation (impact on 168.000 SMEs and 450.000 young people).

  23. Innovation and entrepreneurship • Targets mostly small and medium sized enterprises and start-ups. • At least 1 million gross jobs were created in supported companies. • Increased private investments and R&I activity in firms. Source: EU Commission, DG Regio, 5th Cohesion Report

  24. Promoting employment, education and inclusion • 40% of the unemployed trained have found a job. • Funded one third of Active Labour Market Policies expenditure. • Targets specific vulnerable groups such as youth, women, minorities, low-skilled, long-term unemployed. Source: EU Commission, DG Regio, 5th Cohesion Report

  25. Transport infrastructure • 2000-2006: 44,000 km of road and 12,000 km railway built or reconstructed in the period 2000-2006. • 2,000 km of motorways built • Construction of additional 4,000 km of trans-European rail, including high-speed Source: EU Commission, DG Regio, 5th Cohesion Report

  26. Access to Water and Waste Water Treatment • Faster implementation of environmental directives. • 23 million inhabitants are served by waste water projects to EU standards. • 20 million inhabitants have been served by water supply projects. Source: EU Commission, DG Regio, 5th Cohesion Report

  27. The Future Cohesion PolicyLegal Basis of Cohesion Policy • The Proposal for the next Multiannual Financial Framework (MFF) • New Architecture for Cohesion Policy • „Better spending“. The Reform of Cohesion Policy 2014-2020 • Timeline

  28. Proposal on Cohesion Policy Budget for the MFF 2014-2020 NB: ESF minimum share is 25% for less developed, 40% for transition, and 52% for more developed

  29. New Architecture of Cohesion Policy • Three categories of regions • Less developed regions (GDP per capita < 75%) • Transition regions (GDP per capita between 75% and 90%) • More developed regions (GDP per capita > 90%) • Cohesion Fund for Member States with GNI per capita <90% • Territorial cooperation (3 strands: CBC, transnational, interregional)

  30. Key Elements of Cohesion Policy Reform • Alignment of Cohesion Policy with Europe 2020 • Reinforced strategic programming • Thematic concentration • Conditionalityand performance incentives • Stronger focus on results • Streamlined delivery system

  31. Timeline • 30 June 2011: Proposal on MFF • 6 October 2011: Adoption of Legislative Proposals • March 2012: Commission Staff Working Document on the Common Strategic Framework • June 2012: Partial General Approach in Council • July 2012: Vote on CPR report in REGI committee • End 2012 (?): Agreement on MFF and adoption of new legislative package • 2013: Negotiation of new programming documents • 2014: Entry into force and adoption of programmes

  32. Thank you for your attention and all the best for your further studies! For more information: http://ec.europa.eu/regional_policy

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