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This is not a blog which expresses instant opinions on current events. It rather uses incidents, books (old and new), links and papers as jumping-off points for some reflections about our social endeavours.
So old posts are as good as new! And lots of useful links!

Thursday, January 26, 2012

EC Structural Funds - Cui Bono?

I'm cocooned at the moment in a cosy flat in a wind-swept and snow-bound concrete block in down-town Bucharest.
The ever-watchful Open Europe operation has targeted two big elements of EC spending in reports just out – on Structural Funds and its Development (or “external” assistance). Its report on the latter subject has been drafted for the UK House of Commons Select Committee on International Development which has started an investigation of the EC’s Development Assistance budget. In combination with Member States’ own aid budgets the EU as a whole provides 60% of global Official Development Assistance (ODA) making it the largest donor. "Despite some improvements", the Committee says, "concerns have been expressed about the effectiveness of EC development assistance, the slow disbursal of aid, the geographical distribution of EC aid and poor coordination between Member States".
This blog (and papers on my website) have also made a more detailed critique in relation to its state-building programmes in transition countries. The committee points out  that
Total EC external assistance in 2010 was €11.1 billion. The UK share of this was approximately €1.66. A new Commission policy paper, “An Agenda for Change” was published in October 2011 for approval by the Council in May 2012. At the same time, negotiations are proceeding for the Multi-Annual Financial Framework, and the replenishment of the European Development Fund. Together these will set the parameters for EC development aid from 2014-2020. The Committee invites evidence on:
• The comparative advantage of the EU as a channel for UK development and humanitarian assistance and the UK’s ability to influence EU development policy;
• The proposals set out in the “Agenda for Change”;
• The proposals for future funding of EC development cooperation;
• Progress towards policy coherence for development in climate change, global food security, migration, intellectual property rights and security.
The Open Europe paper is a fairly political briefing on the issues of geographical distribution, administration (costs and waste), EC “value-added” and policy issues (eg questionable reliance on budgetary support) – but seems to have been written by epople with little familiarity with the field of development work.

Its other paper – on EC Structural Funds - is a rather better one which actually looks at what the research has actually tells us about the success over the years of this funding in dealing with its basic objective – namely reducing regional differentials within countries. The answer is "difficult to prove”. Of course, the 60 billion euros a year programme is now more about building up the missing technical and social infrastructures of new member States and the paper argues that this should be properly recognised by the richer member states being taken aut of the programme’s benefits. The paper reminds that
the previous UK Labour Government proposed limiting the funds to EU member states with income levels below 90% of the EU average and suggests that this could create a win-win situation. Such a move would instantly make the funds easier to manage and tailor around the needs of the poorest regions in the EU. The paper estimates that 22 or 23 out of 27 member states would also either pay less or get more out of the EU budget, as the funds are no longer transferred between richer member states.
Structural Funds are, however, an important political tool for those committed to "the European project” in developing and sustaining clienteles. This should never be forgotten!

I have never been a fan of the EC Structural Funds which I have seen expand from almost nothing in the 1970s to 350 billion euros in the 2007-2113 period (60 billion a year – eg 5 billion annual contribution for UK). As a senior politician with Strathclyde Region which was the first British local authority to forge strong relations with the European Commission in the 1980s (when we had no friends at Margaret Thatcher’s court), you might imagine that I was positive about the European funding which we then received. In fact, I was highly critical – mainly for the dishonesty of the claims made about its net benefits. The British Treasury simply deducted whatever we gained from our European funding from our UK funding.

The programme really expanded in the Delors era on the watch of Scottish politician Bruce Millan as Regional Commissioner (1989-1994). In those days, we believed in regional development. In my own case, it was my whole intellectual raison d’ etre! The subject was coming into its own academically – and it was indeed the subject I first focussed on in my own academic career (before I moved into public management). It spawned thousands of university departments and degrees many of which seem still – despite public spending cuts - frozen in institutional landscapes. And I have never seen an intellectual questioning of what it has brought us – although I did recently come across this short critical article on the related field of urban development.

This Open Letter by some prominent Hungarians has just been published about the situation in that country - and is a useful briefing on the issues - as is this EuroTribune one. When I worked in that country, I vividly remember one of my older Hungarian colleagues telling me that she hoped that, this time, the country might actually succeed in something - since the history of her country to that point seemed to have consisted of a series of failures.She must be crying herself to sleep these nights!

The cartoon is one of Honore Daumier's - "The Gargantuan". At times like these, we are in desperate need of the caustic insights of the likes of Daumier, Goya, Kollwitz et al - and those influenced by them such as the Bulgarian caricaturists of the early and mid- part of the last century.

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