Strengthening cohesion policy for a strong Europe

Cohesion policy is the most important investment vehicle of growth in the European Union. For the EPP Group, it is one of the main Union instruments for investment in jobs and growth, for delivering on the solidarity commitment and for increasing the confidence of Europeans in the EU, having concrete, direct impacts on their daily lives. Cohesion policy is also in the DNA of many regional and local policies that rely on European funding to improve the living conditions of the local population.

In the reform of cohesion policy currently underway, our priority is to maintain the current levels of funding, with enough flexibility to adapt to changing priorities and to ensure that access to funds for the end users is simplified. The EPP Group also encourages higher absorption in order for the policy to be effective on the ground.

Enhanced flexibility in programming and implementing cohesion policy is key for the EPP Group since it allows the EU to react to unexpected events, such as the migration crisis.

In order to promote its overall development, the European Union needs to strengthen its economic, social and territorial cohesion. One of the goals is reducing disparities between the levels of development of various regions in Member States. In regions concerned, special attention is paid to rural areas and regions that suffer from natural or demographic handicaps, very low population density and cross-border, mountain regions and islands.

The EPP Group has been always supportive in the process of delivering a credible, modern and performant cohesion policy for Europeans, accelerating the pulse for the adoption of reforms and making sure that no EU region is left behind.

The EPP Group is strongly in favour of keeping a strong, smart and well-balanced cohesion policy post-2020.

What we want to do in the next 5 years

1.  Finalise new rules on cohesion policy and agree on mid-term financing for the period 2021-2027

Our main aim for the 2019-2024 legislature is to finalise the negotiations on the so-called Multiannual Financial Framework (MFF) for the period 2021-2027 on time. The MFF is a binding budgetary document that reflects a political agreement between all EU countries and among EU Institutions on the maximum level of EU spending over 7 years. The MFF defines how much will be spent whereas the reform of the cohesion policy rules define how it will be spent. For the EPP Group, it is essential that both the MFF and the framework for cohesion policy post-2020 (the new rules on cohesion policy that will be applicable as of 1 Jan 2021) be agreed on time so that the EU can be ready to finance the projects of the final beneficiaries without delay.

The EPP Group regards cohesion policy as primarily an investment policy covering all Member States and their regions and supporting their economic development. Investments from cohesion funds have a clear and direct impact on the European economy as a whole. For example, a motorway funded from EU funds brings much more than just connectivity between two regions; it brings potential for business and commerce to thrive. The next cohesion policy should also be better connected with other investment instruments such as InvestEU so that EU money is more efficiently targeted. InvestEU is a programme that provides an EU budget guarantee for investments so that private or public money can be more easily mobilised for strategic projects.

The EPP Group believes cohesion policy should cover all regions and not pick and choose more or less deserving ones. At the same time, one of the primary goals should be to reduce disparities between the levels of development of various European regions. In reality, what this means is that all regions should have access to the investments from cohesion funds, but the levels are determined according to their needs with the overall aim of reaching a uniform level of development across the EU.

To help regions catch up, the EPP Group has proposed an increased level of co-financing in the new cohesion policy reform. We propose that in the future, the EU co-finances 65% as opposed to the 55% proposed by the European Commission for less developed regions. We have also proposed funding specifically tailored to struggling, especially old, industrial regions to help them keep up with the radical transformation and decarbonisation of European industry currently underway.

In order to be effective, the EPP Group believes that cohesion policy should be sufficiently funded. Any reductions could result in the weakening of the European Union by removing the beneficial effects on the European economy. In the talks on the new MFF, we will advocate retaining the current levels of funding for cohesion policy (funding for regional and cohesion policy in 2014-2020 amounts to €351.8 billion).

Low absorption of cohesion funds has been the Achilles heel of cohesion policy in the past. This was partly due to excess red tape and complicated application procedures that were deterring potential applications. As part of the new reform, the EPP Group is fighting for a simplification of the rules to make it easier to apply, easier to qualify for the funds, and make the control procedures lighter for businesses and entrepreneurs benefiting from EU support. We support the Commission proposal to put in place a single rulebook on how to apply for any of the cohesion funds.

Additionally, cohesion policy should be flexible and performance-oriented. The EU should be able to adapt at all times to changing priorities and funnelling EU money to where it is most needed. Therefore it is key that cohesion policy allows for money to be reallocated as long as it stays within the ceilings agreed by the MFF and the ceilings allocated to each Member State. The policy should also be performance-oriented allowing the EU to measure what has concretely been achieved with clear focus on locally-driven projects that support innovation, digitisation, energy transition, education and access to healthcare in all parts of Europe.

Finally, the EPP Group believes that cohesion policy can be most performant under stable macroeconomic conditions. The EU issues macroeconomic recommendations to each EU country every year. We believe that a link should be established between respect for those recommendations and the disbursement of money from cohesion funds, providing that this is not done at the expense of the final beneficiary, e.g. the local entrepreneur.

2.  Stay vigilant over implementation and establishment of priorities

The EPP Group will continue to play a leading role in the constant reviewing, progress checking and quality of the implementation of the cohesion policy. If we find the new rules are not delivering the expected results, we are ready to propose legislative and priority changes to the cohesion policy framework. Finally, we are also ready to propose for money to be reallocated as long as it stays within the ceilings agreed by the MFF and the ceilings allocated to each Member State.

3.  Promoting increased visibility of cohesion policy among Europeans

The EPP Group will be the driving force in making the achievements of cohesion policy known to Europeans by promoting cohesion policy goals and increasing their awareness of the immediate and concrete projects the Union is delivering. Raising awareness of the positive impact of the EU on their everyday lives will remain an important target, as the projects bring tangible results and are visible on the ground. One example is ‘Let the Stars Shine’, an EPP Group initiative launched in 2018 on the communication of cohesion policy results that will continue in the next parliamentary term. The EPP Group strongly supports another project - EU Action for Smart Villages - which is another example of how cohesion policy is a financing supporting instrument on innovative ways of creating attractive rural areas for citizens.

Cohesion to remain a flagship EU policy

The purpose of cohesion policy is to reduce economic, social and territorial disparities inside the EU. The Union, through comprehensive public investment for jobs and growth, is bringing more internal coherence, necessary for its success in the long-term, between its Member States and regions. The EPP Group has consistently supported this policy and its objectives and it intends to maintain cohesion as the main EU investment policy, available for all Member States and regions.