Improving the added value of EU Cohesion policy Professor John Bachtler

1. EPP-ED Committee HearingA New Regional Policy: Innovative Ideas for the Post-2013 ReformEuropean Parliament, 8 November 2007 Improving the added value of EU Cohesion policy Professor John Bachtler European Policies Research Centre University of Strathclyde, Glasgow john.bachtler@strath.ac.uk

2. European Policies Research Centre • specialises in comparative research on public policy throughout Europe • focus on monitoring and analysis of regional development policies at European, national and sub-national levels • policy research, advice and exchange of experience through two networks: • IQ-Net (Improving the Quality of Programme Management) – regional and national Structural Fund programme management authorities from 14 Member States (www.eprc.strath.ac.uk/iqnet) • EoRPA (European Regional Policy Research Network) - national government departments responsible for regional policy – 10 countries (www.eprc.strath.ac.uk/eorpa)

3. Improving the added value of Cohesion policy • Added value of Cohesion policy • What are the lessons? • What is the scope for change? • What needs to change? • Improving the added value of Cohesion policy • policy focus • policy management

4. The added value of Cohesion policy:What are the lessons? • Substantial transfers of resources to the poorer Member States and regions • Significant evidence for positive economic and employment effects….… • … but several studies have found limited impacts on regional disparities or long-term growth • Key concerns • over-reliance on infrastructure investment (especially in the 1990s); insufficient attention to education and human capital • business aid less effective in poorer regions • effectiveness dependent on institutional capacity and supportive policy environment

5. The added value of Cohesion policy:What are the lessons? • Some positive qualitative effects… • levering-in of additional resources for economic development • multi-annual planning process • partnership • monitoring and evaluation • implications for European integration • ….but again, effects are disputed or qualified • negative aspects are complexity and bureaucracy • effects more prevalent in Objective 2 than Objective 1 (and historical in some cases) • Conclusion: the added value of the policy is mixed

6. The added value of Cohesion policy:What is the scope for change? Scope for change is constrained by… • ‘pork barrel’ politics • use of Cohesion policy as a mechanism for securing agreement on net balances • perverse outcomes for spatial allocation of resources • perception of the budget review as a starting point for the next Financial Perspective • institutional inertia

7. The added value of Cohesion policy:What is the scope for change? • Emerging Member State views… • net payer emphasis is again likely to focus on limiting policy to poor countries or poor regions • EU12 aim is to ensure a well-funded policy (but this may not be universal) • southern EU15 concern is for an ‘all region’ policy (but may be delivered through Heading 1a) • small EU15 countries are concerned about the quality of the policy (Lisbon focus, efficiency) • Conclusion: a greater need to justify the policy and to improve demonstrable added value

8. The added value of Cohesion policy:What needs to change? • Recognition of regional variability • Integration of national (regional) policy objectives • More flexibility to deal with change • Less prescriptive approach to challenges • Stronger emphasis on policy additionality/innovation

9. Improving the added value with a ‘smarter’ Cohesion policy – focus • Key objective: how can the EU best assist regions (or territories) to manage economic, social and environmental change? • Incorporate a stronger functional approach to policy - helping regions to address questions such as…. • How can the three dimensions of policy – spatial, sectoral and thematic – be effectively integrated into a coherent whole? • How should the territorial allocation of expenditure be prioritised? • How can the unequal potential and capacity of regions for development be best addressed? • How can a systemic, collaborative approach be achieved in an efficient and effective way? • How can a balance between regional coherence and local innovation and understanding be achieved? • What is the most effective way of achieving a balance between setting clear strategic direction and ensuring sufficient flexibility to adapt to changing market conditions?

10. Improving the added value with a ‘smarter’ Cohesion policy - management A ‘smart’ policy, which is not just about money…… • strategic vision – establishing a broad framework for territorial action • financial resources – where they are lacking, essentially in poorer MS; elsewhere, subject to a ‘test’ of policy innovation • institution-building and human capacity development – support for systems, structures and people (to develop strategies, design programmes, manage expenditure, implement instruments, evaluate interventions) • knowledge – generating new ideas, investing in new learning, mobilising the flow/exchange of knowledge, facilitating the application of good practice and innovative ideas • coordination – bringing together actors to collaborate, primarily and particularly at the supra-national level

11. Improving the added value of Cohesion policy Thank you for your attention! john.bachtler@strath.ac.uk