European cohesion policy state of play

February 20, 2014

Funding Scheme: 2014-02-20


The Publication of the winter edition of the Panorama magazine dedicated to the cohesion policy marks the opportunity to focus on the main new important elements introduced by the new programming period (2014-2020).


The territorial cohesion policy is funded by the ERDF, the ESF and the Cohesion Fund. Originally conceived as the financial instrument of social Europe with a view to mitigate the effects of the creation of the common market on the weakest areas, it is now viewed as the main financial lever pulled by the EU to increase human and physical capital in a European perspective. With a budget of  €352 billion for territorial cohesion policy (€500 billion if one includes fundings that will add up to European co-financing) , the programming period 2014-2020 just provides continuity with the previous ones regarding financial matters.

The main differences with the period 2007-2013 relate to the criteria under which co-financing will be granted. The kind of initiatives particularly likely to be selected for the coming years may include cross-border projects, actions to support SMEs based on loans rather than grants (equity/venture capital , guarantees and loans backed by structural funds), projects tackling urban issues, and last but not least projects that will contribute to innovation, employability and entrepreneurship.

The later is also not specific to structural funds. Territorial Cohesion will actually mainly consist in applying on a regional scale the strategy which makes the enhancement of entrepreneurship, SME development, innovation and competitiveness the be-all and end-all of growth and territorial development in Europe.

More generally, the emphasis will be laid on reducing red-tape, on introducing accountability and better monitoring regarding the use of granted resources (the best performing programs receive additional funds or “reserve fund” at the end of period). Coordination between the three structural Funds (European Regional Development Fund, European Social Fund, Cohesion Fund) and other financial instruments of the EU will be increased in order to avoid projects overlaps.

With regard to France more specifically, the introduction of the “Transition regions” status, an intermediate category between the “most developed regions “and “less developed regions”, and whose GDP is between 75 and 90% of the Community average, has steered controversy. Indeed, the 10 French transition regions will enjoy increased financial support compared to their more developed counterparts. This raises the problem of unequal treatment between rich departments that belong to not-so-rich regions (Transition regions) on the one hand and poorest departments that belong to more developed regions on the other hand.  Is this really fair that the territories of Corrèze , a rather rich department located in a Transition Region (Limousin), will benefit from increased support compared to the neighboring territories of the Lot, a rather poor department located in a more developed region (Midi -Pyrénées) ?