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EU: Cohesion Policy

Volume 698: debated on Tuesday 5 February 2008

My honourable friend the Minister of State for Employment Relations and Postal Affairs (Pat McFadden) has made the following Written Ministerial Statement.

On 30 January 2008, the Secretary of State for Business, Enterprise and Regulatory Reform submitted the Government’s response to the European Commission’s consultation on the future of cohesion policy. The response was drawn up in consultation with other government departments and the devolved Administrations.

In the former Minister for Competitiveness’s Written Statement to Parliament of 27 November 2007 he outlined the approach that the Government were taking to the response, in particular the focus on the aims of cohesion policy and the most efficient mechanisms for achieving these aims. The response is consistent with this approach. It does not pre-empt the Government’s view on the separate Commission consultation on the EU budget review. The response maintains the policy direction set out in A Modern Regional Policy for the United Kingdom (2003), taking account of the policy statements in Global Europe, in particular, that there should in the future be,

“a significant increase in the percentage of structural funds to poorer member states”.

Due to the scope of the questions asked in the consultation itself, the Government’s response is formed of two parts. A covering letter is used to raise issues in relation to the debate on the future of cohesion policy that the Commission’s questions do not address. This is followed by responses to each of the questions.

The letter starts by putting cohesion policy into context, as established in the treaty; ie it contributes towards the overall aims of the European Union by addressing disparities in development between regions. The best way to address these disparities is through the Lisbon and Gothenburg agendas, supporting the sustainable development of jobs and growth, noting that cohesion policy is not the only means of addressing this agenda. These themes are further developed in the answers to the specific questions.

The letter then states that our response focuses on the shared aims of cohesion policy and that reform of the structural funds should be given full consideration as part of the EC budget review. It highlights the three principles on which debate on the review should be based, as stated in Global Europe, and notes that in line with these principles a priority for reform will be,

“a significant increase in the percentage of structural funds to poorer member states”

but goes on to acknowledge that the impact of significant changes to funding will need to be considered.

Finally, the point is made that the debate on the future of cohesion policy is wider than the questions raised in the consultation and examples of other questions that could be considered are provided.

The consultation questions themselves are divided into three themes. The first set of questions asks how far cohesion policy is adapted to addressing the challenges of globalisation, climate and demographic change. The Government’s response is that cohesion policy should be driven by the integrated guidelines for jobs and growth and the national reform programmes (NRPs). The challenges facing European regions are not new and are already being addressed at a European, national, regional and local level. Cohesion policy should remain focussed on achieving sustainable jobs and growth.

The second set of questions asks how cohesion policy can further develop an integrated and more flexible approach to growth and jobs in the context of these new challenges. Our response advocates a strategic approach to cohesion policy directly linked to the integrated guidelines and NRPs. The link to the NRPs should provide the flexibility for cohesion policy to add value to the policies relevant to each member state and within this framework allow regions to focus on their specific priorities.

The final set of questions asks how well suited the existing policy management system would be to deliver the requirements identified in the response to the previous set of questions. In responding, we reiterate the approach set out to the previous set of questions and call for simplification and proportionality in the financial management systems. The benefits of co-operation activities are also stressed, as is the need for proper financial management.

As well as being published on the European Commission’s website, this response and covering letter will be made available to the public through the Business, Enterprise and Regulatory Reform website. The response has also been brought to the attention of a wide variety of UK stakeholders, Members of the European Parliament and the appropriate parliamentary scrutiny committees. In addition, a copy of the response and the covering letter will be placed in the Library of both Houses.