European Cohesion Policies

Contents:

1. Traditionally cohesion policies are to reduce disparities in social and economic welfare between different regions and/or groups within the EU. With the renewed Lisbon strategy, sustainable growth for the entire EU has become the most important objective and following a guiding principle for European cohesion policies, too. Analyze the relationship between these two objectives of the cohesion policies, growth and reduction of disparities
Do you discern any contradictions or tension between these objectives or do they just complement each other?
A) THE RELEVANCE OF THE LISBON STRATEGY
B) CONFLICTING OR COMPLEMENTING INTERESTS IN EU POLICIES

2. In the regulation for the European Regional Development Fund (EC) No. 1080/2006 and in the regulation for the European Social Fund (EC) 1081/2006 you will find that assistance granted to Member States is focussed on certain thematic priorities. You are asked to analyse and to compare the priorities of both Funds in the light of the overall objectives for the cohesion policies. What are their differences in scope? Where are similarities? Where are potential synergies?
A) STRUCTURAL FUNDS
B) THE CONVERGENCE OBJECTIVE
C) THE REGIONAL COMPETITIVENESS AND EMPLOYMENT OBJECTIVE
D) DIFFERENCES AND SIMILARITIES

3. For the funding period 2007-2013 the budget of the European Structural Funds is dedicated to certain objectives and financial instruments. How is the present distribution of the financial means of the Structural Funds? What are the main reasons and criteria having guided the decision for this distribution? Please assess the adequacy of the existing distribution and give reasons for your conception
A) DISTRIBUTION OF THE FINANCIAL MEANS OF THE STRUCTURAL FUNDS
B) MAIN REASONS AND CRITERIA FOR THE DECISION FOR THE FUNDING DISTRIBUTION
C) ASSESSMENT OF THE ADEQUACY OF THE EXISTING DISTRIBUTION

4. Besides the European Structural Funds there is a large number of European funding programmes covering a broad range of thematic subjects. According to self-developed criteria you are asked to differentiate systematically between these two sources of European funding

5. According to a commonly agreed Operational Programme the means of the European Structural Funds are implemented decentralized by the Member States or the regions. Based on this framework, it is up the national and regional governments to make the best use of European money. You are asked to demonstrate how the quality of regional public administration services can contribute to an effective and efficient implementation of the European Structural Funds. In your argumentation you should make reference to empirical

examples

References
A) BIBLIOGRAPHY
B) WEBLINKS

1. Traditionally cohesion policies are to reduce disparities in social and economic welfare between different regions and/or groups within the EU. With the renewed Lisbon strategy, sustainable growth for the entire EU has become the most important objective and following a guiding principle for European cohesion policies, too. Analyze the relationship between these two objectives of the cohesion policies, growth and reduction of disparities. Do you discern any contradictions or tension between these objectives or do they just complement each other?

a) The relevance of the Lisbon strategy

The renewed Lisbon Strategy is a strategy for higher aggregate growth; Cohesion Policy is a policy for reducing regional economic disparities through higher growth in prioritised regions. The strategy of the Funds focuses on the provision of subsidies to investment in particular types of public goods that are seen as necessary preconditions for economic growth or generate other positive externalities.

“(…) any regional development strategy lacking global perspective is doomed to bring marginalization in the medium and long-term to the territory it covers. (…) This match between Lisbon and cohesion policy is an important one because cohesion policy is firmly anchored in the economic governance system of the Union as its main public expenditure instrument. (…).” ¹

b) Conflicting or complementing interests in EU policies

Areas of Complementary

Economic growth, high employment and low unemployment are objectives shared by the Structural Funds and the Lisbon Strategy. They both also share the premise that growth and development should not be achieved at the cost of environmental degradation: Economic development should be environmentally sustainable. Social inclusion is to a great extent also a shared objective for the Structural Funds and the Lisbon Strategy².

Areas of Conflict

While the Lisbon Strategy’s vision is ”a dynamic, competitive and knowledge-based economy”, the fundamental vision of the Structural Funds is “an economically and socially cohesive Community”, pointing to a concern for regional economic disparities.³ In terms of available funding, the Structural Funds have an explicit spatial dimension to their objectives. Development is to be supported in specific Member States, regions, or areas, either being defined by relative poverty, low population densities, remoteness, or structural economic weaknesses⁴. On the other hand, the spatial dimension plays a very minor role in the Lisbon Strategy. The strategy and it´s objectives are defined as a strategy for the European Union as such, not for specific regions, states, or territories within the Union.⁵ “The Community Lisbon Programme sets out the EU-level priorities for the next three years.”⁶

The level of operationalisation of the several objectives in the two approaches can be identified as a further point of conflict between the Lisbon Strategy and the Structural Funds concerns. Although the Cohesion Fund targets two specific investment fields rather narrowly, it is characteristic of the Structural Funds that their objectives are formulated in broad terms, as themes within which eligible activities can be supported, rather than as operational targets⁷. This fact is related to the decentralised implementation system of the Structural Funds programmes in a bottom-up process which is to take into account differences in the regional contexts and needs. The Lisbon strategy involves a series of very operational investment and development targets.⁸ Some of these follow directly from the Lisbon Strategy’s Open Method of Coordination: Quantitative targets facilitate systematic comparison across Member States in order to check progress. However, the operational character of many of the Strategy’s objectives also highlights the fact that compared to the Structural Funds, the Lisbon Strategy relies more on a top-down approach. “Its mechanisms for implementation are decentralised, but the objectives which are to be implemented de-centrally are in some respects so specific that there is little room for an adaptation at national or regional level to specific national or regional requirements.“⁹

Another point of conflict between the objectives of the Structural Funds and the Lisbon Strategy concerns the question of investment in physical infrastructure. Physical infrastructure plays a minor role compared to the Strategy’s emphasis on deregulation, the creation of favourable regulatory conditions for business development and increased investment in research and development, education and human resource development. Contrary to this are the Cohesion Fund and the Structural Funds under Objective 1. The Cohesion Fund finances physical transport and environmental protection infrastructure projects. Objective 1 provides significant support to the development of physical infrastructure such as highways, railroads, bridges, tunnels, and waste treatment, and to telecommunications and energy. The substantial complementarities highlight that the two approaches are not pursuing entirely different agendas. The Lisbon Strategy is a “manifestation of a European consensus on fundamental political objectives (…), against the background of the perceived challenges and possibilities arising from increasing international trade and division of labour and new technological developments. The Structural Funds are a manifestation of a concern – for social and economic cohesion – which became more salient from the mid-1980s until the mid-1990s, in connection with the realisation of the Single Market project and the second and third waves of EU enlargement.”¹⁰ Since the cohesion principle is integrated in the Union’s Treaty base, this concern is incorporated within the Union’s institutions and structures.

Concluding, the Lisbon Strategy and the Structural Funds both reflect and share a broader European political consensus. It implies that economic growth, improved competitiveness and increasing employment have priority, but that higher growth should go in accordance to social inclusion and environmental sustainability. This means that in numerous respects, the Structural Funds can contribute to the achievement of objectives which are also objectives of the Lisbon Strategy.

2. In the regulation for the European Regional Development Fund (EC) No. 1080/2006 and in the regulation for the European Social Fund (EC) 1081/2006 you will find that assistance granted to Member States is focussed on certain thematic priorities. You are asked to analyse and to compare the priorities of both Funds in the light of the overall objectives for the cohesion policies. What are their differences in scope? Where are similarities? Where are potential synergies?

a) Structural Funds

Structural Funds are monies allocated to regions to stimulate sustainable economic development. There are two types of structural funding: ERDF – European Regional Development Funds and ESF – European Social Fund. The European Social Fund (ESF) is implemented in line with the European Employment Strategy. It focuses on four key areas: increasing adaptability of workers and enterprises, enhancing access to employment and participation in the labour market, reinforcing social inclusion by combating discrimination and facilitating access to the labour market for disadvantaged people, and promoting partnership for reform in the fields of employment and inclusion. Its fields of activity are focused on: ¹¹

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The European Regional Development Fund (ERDF) fosters the promotion of public and private investments helping to reduce regional disparities across the Union. The ERDF will support programmes addressing regional development, economic change, enhanced competitiveness and territorial cooperation throughout the EU. Funding priorities include research, innovation, environmental protection and risk prevention, while infrastructure investment retains an important role, especially in the least developed regions. Its fields of activity are focused on: ¹²

Direct aid to investments in companies (in particular SMEs) to create sustainable jobs Infrastructures linked notably to research and innovation, telecommunications, environment, energy and transport

Financial instruments to support regional and local development and to foster cooperation between towns and regions

Technical assistance measures

[...]

¹ Hübner, Danuta, Member of the European Commission responsible for Regional policy "Cohesion policy and the Lisbon Agenda"; Speech at the Conference: "2008-2010 and beyond: Lisbon Strategy and Cohesion Policy - European Regions facing future challenges", Bologna, 4 July 2008

² The Lisbon Strategy aims for the reduction of poverty and for equal opportunities for being active in the labour market, for reducing gender gaps in employment and occupational segregation, and for reforming social protection systems so as to be financially sustainable in the medium and long term; The Structural Funds’ emphasis is on equal opportunities between men and women and on the elimination of discrimination on the labour market on the grounds of gender, race, ethnic origin, disability, or age.

³ Cf.Council Regulation (EC) No. 1260/1999 of 21 June 1999.

⁴ The spatial dimension is not important for all of the Structural Funds, however. In the Objective 3 , and in the strands of the Objective 1 supported by the ESF, the European Social Fund supports a high level of employment, facilitated through human resource development, business development support, and investment in human research, science, and technology potential throughout the Union. These objectives fit very well with the Lisbon Strategy’s agenda.

⁵ Lisbon European Council Presidency Conclusions 2000: “The Union has today set itself a new strategic goal for the next decade” http://www.consilium.europa.eu/ueDocs/cms_Data/docs/pressData/en/ec/00100-r1.en0.htm (28.08.2008)

⁶ Lisbon Strategy for Growth and Jobs: frequently asked questions, Part One: The Commission's December 2007 Strategic Report: http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/07/568&format=HTM&aged=0& language=EN&guiLanguage=en (28.08.2008)

⁷ Some of the Lisbon Strategy’s objectives are also broad. This goes for the global objective of turning the Union into the most dynamic and competitive knowledge intensive economy in the world by 2010 and several other of the Strategy’s objectives

⁸ For instance the objective of increasing overall spending on R&D and innovation in the Union to 3 %t of GDP by 2010, and an objective of developing schools and training centres into multipurpose local learning centres accessible to all.

⁹ Danish Technological Institute:Thematic Evaluation of the Structural Funds’ Contributions to the Lisbon Strategy Synthesis Report, Brussels, February 2005 p. 51

¹⁰ Danish Technological Institute 2005, p. 51

¹¹ http://ec.europa.eu/regional_policy/sources/docoffic/official/regulation/newregl0713_en.htm (08.08.08)

¹² http://ec.europa.eu/regional_policy/sources/docoffic/official/regulation/newregl0713_en.htm (08.08.08)