Download North East of England

NORTH EAST REGIONAL POSITION ON
THE FUTURE OF EU COHESION POLICY
This paper presents a response from the North East of England to the
European Commission’s debate in the future of EU cohesion policy.
This report has been prepared by the European Management Board for the
Region, which is a partnership between the Government Office for the North
East, Regional Development Agency (One NorthEast), and the North East
Assembly
Together the partners in the European Management Board have a core role in
the development, implementation and evaluation of Structural Funds in the
Region, and a responsibility to ensure an efficient and effective fit with
national and regional economic policies and our Regional Economic Strategy.
As the proposals in the Commission’s White Paper on European Governance,
and UK Government white paper on regional devolution “Your Region; Your
Choice” are implemented, the role of the regional partners, and therefore the
European Management Board, in relation to direct dialogue with the
Commission will be strengthened further.
The North East is the smallest UK region with a population of 2.8million. It is
also the poorest. The level of GDP/PPS in the entire region is now 77.8% of
the EU average, lower than any other region of the UK, even those with
objective 1 coverage for parts of their areas. The GDP rate in the North East
against the EU 15 during the last structural fund period has dropped from
79.9% (i.e. by 2.1%). The North East is still declining in comparison with other
regions in the UK and actually now shows signs of lagging behind some of the
regions of the applicant states.
The North East of England has been a substantial beneficiary of EU Structural
Funds, through a series of Objective 2, Objective 3 and Objective 5b funding
programmes and community initiatives. The Region received £1 billion of
Structural Fund support between 1989 and 1999.
These funds have been fundamental in driving forward the restructuring of the
Region through the delivery of economic development activity in the Region to
further the development of businesses and the inclusion of individuals and
communities.
EU funding has added value in our Region in the following ways:
• It was, in the past the only source of “region specific” funding to further
the development of the Region’s economy over and above national
funding programmes.
• EU funding provided the impetus for partnership working at a Regional
level
•
•
The timescales which apply to EU funding streams encourage a longer
term planning horizon
The availability of EU funding has enabled a higher level of innovation
and innovation in economic development activity in the Region
In the current programmes alone, the Region can take advantage of €717
(£430) million funding through the Objective 2 programme and a further €330
(£200) million through the Objective 3 programme. The Region is committed
to using these funds effectively and maximising value for money
OVERALL PRINCIPLES
The Region supports the process of enlargement. It will serve to develop and
preserve the long term stability of those countries that are seeking to join the
Union, and that of the current Member States. In addition it will strengthen the
overall position of the EU as an economic unit and provide additional trading
opportunities for Member States.
The Region supports the continuation of Cohesion as a core policy within the
EU - whatever its size. This policy should be given significant budgetary
provision at EU level.
It is important that future Cohesion policy continues to reserve Objective 1 for
the poorest regions in the EU. These are currently defined as those with a
GDP of less than 75% of the EU average.
The allocation of funds to the new Member States must be linked to an
effective “absorption limit” and their ability to use the funds to good effect.
Linked to the overall position on EU policy, it is critical that reform of the CAP
should be considered in the context of the review of Cohesion policy. The
funding currently applied to CAP should be part of a joint review, which
ascribes appropriate importance to rural and urban business and community
development
FUTURE USE OF COHESION RESOURCES OUTSIDE OBJECTIVE 1
REGIONS
It is important that Cohesion policy also recognises that there are many
current Objective 1 regions will lose Structural Funds because the
enlargement of the EU will set a new lower average GDP per head, therefore
the 75% threshold will be lower compared to that of the existing one for the
EU of 15. Objective 2 Regions will also lose status but still have economic and
social restructuring needs. The North East of England is likely to be included
in this category even though is a diverging region whose GDP is slipping
further behind the EU average.
The ongoing economic needs of the Region will be compounded by the fact
that, in the context of the European Spatial Development Perspective, the
centre of gravity of the EU will move east, and the North East of England will
be on the geographic periphery of the EU.
2
The North East of England is in support of future non-objective 1 resources
being focused on the development needs of these Regions, as defined in their
Regional Economic Strategies.
The Regional Economic Strategy will in turn be more clearly aligned to the
objectives and priorities of the European Union, including strengthening our
policy development work on a trans-national basis with other Regions in the
EU.
The Region will still need to be supported to undertake work on themes such
as skills, enterprise, innovation, R& D, competitiveness and rural and urban
development in order to make our contribution to the Lisbon agenda and
future cohesion within the UK and the EU.
The process for agreeing priorities for the use of EU resources, and their
administration should be substantially simplified to ensure give greater
simplicity, flexibility and control to regional partners and enable resources to
be aligned with regional priorities for cohesion and economic restructuring,
through the recognition of the Regional Economic Strategy as the foundation
document for the use of funding from the EU.
We encourage future non Objective 1 funding (both Objective 2 and
Objective 3) to be based upon a thematic approach to enable Regions to
access support for key areas of weakness based on the use of a wider range
of indicators (not just GDP). The funding should be tied to the achievement of
competitiveness outcomes (such as R&D, Skills development, GDP growth,
job creation and the reduction of exclusion) at a Regional level and not restrict
activity to sub-areas within the Region.
The themes, as well as being aligned with Regional priorities should
encourage the use of future funding to be developed in line with the important
EU priority issues in support of the Lisbon, Luxembourg and Gothenburg
agendas of
— More better quality jobs
— Support for the new economy and knowledge based society
— The promotion of social inclusion
— The promotion of equality of opportunity
The Region would also encourage the Commission to encourage Regions to
further develop trans-national partnerships, not only for these specific funding
packages but also for the wider benefits of inter-regional learning in line with
Regional strategies. This would then enable Regions across the Union to
work collaboratively on these issues, rather than only having an inward focus
on their own Region.
3