One of the panels at the Council for European Studies conference in Amsterdam a couple of weeks ago focused on local and regional authority engagement with EU cohesion policy, and what the impact of the current financial crisis and austerity has been.
It was noted that the European Commission often prides itself on the positive impact cohesion policy has had on decentralisation. However, several points made during the discussion seemed to suggest there was actually a trend towards greater centralisation. For example:
- Funding allocations for different regions within states are still largely determined by national government. Last week, for example, the Department for Business, Innovation and Skills announced it’s allocations for ERDF. While local authorities and the Local Economic Partnerships (the main beneficiaries of these funds) no doubt lobbied hard to secure a fair share, the decision was still central government’s alone to make.
- Projects being supported by ERDF are selected and funded on the basis of their ability to meet programme- and EU-specified objectives, rather than addressing local need.
- As part of the forthcoming 2014-2020 programming period, partnership contracts had to be signed with the European Commission, but these are made with central governments, not the local and regional bodies who will benefit from the programmes.
- Local and regional government re-organisation in some states (often as a response to the crisis and austerity) has meant sub-national governments are less empowered to take advantage of EU regional policy.
- A reduction in government grants in many countries (also part of austerity programmes) means that local authorities are also finding it increasingly more difficult to find the match funding often required for projects. These budget constraints also mean that local authorities find it difficult to continue employing European offices, meaning they are losing the skills and capacity necessary to engage with EU regional policy.
EU regional policy has the potential to help local and regional authorities weather the effects of the financial crisis and austerity. As far as sub-national authorities are concerned, the will be the real measure of success will be the extent EU regional policy can assist localities in meeting their needs to become more prosperous and competitive during this time of crisis and instability. Local authorities are best placed to know the strengths of their respective regions and what work needs to be done to promote prosperity. However, while the key decisions continue to be made by central governments and local authorities are not free to address local needs, then the real impact of EU regional policy at a local level will be limited.