The European Commission presented on 16th July its proposal for an ambitious Multiannual Financial Framework (MFF) for the next period 2028-2034 amounting to almost EUR 2 trillion (or 1,26% of the EU’s gross national income on average between 2028 and 2034).
Initiated for the first time in 1988, the MFF is at EU level the most important political decision to be taken with the goal to provide the financial means for the Union’s policy.
According to the Commission ‘this framework will equip Europe with a long-term investment budget matching its ambitions to be an independent, prosperous, secure, and thriving society and economy over the coming decade’. With in the background an increasing number of challenges in numerous areas such as security, defence, competitiveness , migration, energy and climate resilience.
The Commission proposes a fundamental redesign of the EU budget, which will be in its view more streamlined, flexible and impactful whereby this budget requires modernised and stable sources of income with new own resources and adjustments to existing ones. Not going into all details, I want to highlight the new European Competitiveness Fund, the renowned EU research framework, with its flagship Horizon Europe, and the building of a European Defence Union. All this with great impact on the future of the Europeans.
Cohesion Policy and the Common Agriculture Policy (CAP) play an essential role for regions and local communities. These policies represent historically the highest part of the Union’s budget, over the years implemented in consolidated programs with the aim to strengthen economic, social and territorial cohesion by reducing disparities between regions and foster a more balanced development across the EU.
Now, in the proposed MFF, important changes can be expected.
Under the entitlement ‘Investing in people, Member States and regions’, the Commission argues as follows: ’The new long-term budget will bring together EU funds implemented by Member States and Regions under one coherent strategy, with cohesion and agricultural policy at its core. This strategy will be implemented trough National and Regional Partnership Plans, simpler and more tailored, to maximize the impact of every euro. Having one single plan per Member State (the National Plan) integrating all relevant support measures – whether for workers, farmers or fishermen, cities or rural areas, regions or the national level- ensures a much stronger impact, and a much more efficient use of European funding’.
1. Sounds good but in fact a major break with current policies and a big step back for regional and local (co)responsibility.
The four largest political groups in the European Parliament (EPP, S&D, Renew, Greens/EFA) oppose themselves, after their concern expressed from the outset, against the proposed ’National Plans’. Because they weaken core EU policies, and undercuts the role of regional and local authorities – into a single national funding envelope for each member state. They threaten to reject a key part (about one half) of the budget proposal unless the Commission changes significantly its approach about the management of funds allocated to farmers and regions, going away from its intention to bring this under the management of the individual member states. By submitting a formal request on 30th October to president Ursula von der Leyen, they hope to persuade the Commission to change preventively the proposal in order to avoid a clash.
Let us take a closer look at the criticisms.
Firstly, combining resources with other policy areas could dilute the specific weight and objectives of economic, social and territorial cohesion and lower the target and in consequence the results. Merging separate funds for the CAP, Cohesion Policy and other successful programs into ’umbrella mega-funds’, risks undermining their proven success.
Secondly, even the Commission has stated that cohesion policy will remain a pillar of the future budget, a lack of defined focus could lead to less transparency and finally make them vulnerable to cuts and less budget.
Thirdly, the new framework leads to greater centralization of funding decisions at the national level, marginalizing regional and local authorities. With the risk to leave funding vulnerable to the political whims of national governments with no strong links to European objectives and turn the EU-budget into a collection of ’27 separate shopping lists’ rather than a coherent, shared vision.
The European Committee of the Regions expressed also its objections, assessing that the Commissions’ proposal weakens the bond between the EU and its regions and cities whereas only a place-based approach relaying on local solutions and decentralised strategies, will help the Union to deliver its key objectives of cohesion, resilience and proximity.
What do we have to face in addition?
Some underuse or not appropriate use of cohesions funds must be tackled by strengthening the process and not by recentralization. We already can assess that too much centralization will not lead to better results, could weaken cohesion, and disconnect citizens from the EU project.
2. Centralizing cohesion and common agricultural policy deny the essence of such policies namely the (co) responsibility of regional and local authorities because they are the best in place to offer the right common ground with their networks, connected societal actors, experience and results in the past. And moreover it’s an infringement of art. 5 of the Cohesion Policy Regulation where partnership with regions and local authorities based on multilevel governance, are explicitly foreseen. The ‘ National Plans’ remove thus the legal obligation for national governments to involve local and regional authorities in the management of EU funds
Not least it’s against one of the most important political principles in the European Union, the subsidiarity principle. In simple words, the notion that decisions should be made at the lowest possible or most local- regional level of governance or organization where the benefit of the citizens is greatest. Without any doubt, the regional and local authorities remain the most competent partners of the Commission to deliver the best results on cohesion and common agricultural policy. When these policies would be used for national purpose, these policies will fail. This shift could also lead to risks for interregional or transregional policies whereby the boarder connectivity is just an asset and not a disadvantage.
I can only hope that the Commission has the wisdom to return to good participatory governance in partnership, respecting trustworthy cooperation with regions, local authorities, farmers and fishermen and with focus on an evidence- and place-based multi-level governance.
