The European Commission’s Communication on the mid-term review of cohesion policy (MTR) signals the need for accelerated reform. It comes as the EU musters its response to complex transitions, including a first-of-its-kind security and defence agenda.
There is much to commend in the MTR. Its core themes are strongly linked to regions’ transition efforts, including the EU’s comprehensive security needs. The latter’s visibility in cohesion policy has come not before time. Positively, the wider cohesion community seems to have caught up with this direction, acknowledging the need for cohesion to play a role in responding to the EU’s existential security needs.
However, beyond a broad vision for action, the MTR offers no transitions-driven framework for regions to mobilise and connect their related challenges – whether green, digital, social or security-related. The Commission should come forward with a framework to expedite the roll-out of the re-oriented cohesion policy for the remainder of the current programming period, while supporting regions to prepare beyond 2027.
Amid a turbulent period of change for the EU, a strongly centralised cohesion policy shift is unfolding. This risks diminishing the Union’s place-based policy commitments, while worsening inequalities. A whole cohesion community response is needed to counter this direction, with concerted, corrective action to ‘stress-test’ the vision set out in the MTR, and the extent to which all regions have the means to rise to the challenges ahead.
If the results of MTR are to be translated into concrete and effective action, several elements require further scrutiny, supported by territorial impact assessments. These include:
- The re-purposing of cohesion funds for unfinished Recovery and Resilience Facility (RRF) projects – this must be underpinned by a strongly targeted approach based on regional engagement and ownership.
- Cohesion financing for large enterprises – the case for their support needs to be well made, ensuring supply chain benefits accrue to regional innovation ecosystems (and beyond, to other EU territories) especially for the least innovative territories, to support the industrial defence of EUrope.
- Dual-use technologies and innovation – efforts must be harnessed to cohesion policy’s smart specialisation agenda, capturing territorial benefits and driving citizen-oriented value.
EU regions are exposed to a new operating environment of significant uncertainty, characterised by uncomfortable trade-offs and competing local priorities. In turn, the traditional toolkit for regional development is rapidly becoming obsolete. Supply-side skills and competences for EU public administrations must be upgraded to tackle a set of new public policy demands to improve the efficiency and effectiveness of public financing, not least in navigating complex transitions. A paradigm shift in EU regional and economic development is underway. Based on the collective learning that will come from the ‘piloting’ of the MTR’s results, the Commission should design a new regional development framework to underpin the post-2027 cohesion policy.
As the EU navigates an important turning point in its trajectory, it must avoid sacrificing its long-standing equity considerations in pursuit of improved efficiency. The MTR’s results expose the challenges and opportunities that lie ahead for EU regions. Cohesion policy must be reinforced to help drive course correction in an increasingly centralised and top-down decision-making approach to EU policy and investment. Cohesion policy must strengthen its challenge function in exposing and responding to centralised decisions that are made without due account of the impacts on the places and people affected. A diminished cohesion policy will exacerbate the EU’s existing divides and inequalities. The Union’s internal security depends on getting this right.
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