Having finalised the EU’s budget plans until 2020, the European Commission plans to use the next long term budget period between 2021 and 2027 to modernise the EU Cohesion Policy.
The policy, which defines priorities for the EU’s investment programme, will be geared towards encouraging innovation and digital technologies, with particular focus on small to medium enterprises and the circular economy. It will aim to invest in all regions, with a tailored funding approach to allow less economically developed states to hold their own in a globalised economy; and will streamline EU Cohesion Policy rules to make the funding application process simpler.
The new EU Cohesion Policy will focus on five primary objectives:
- A smarter Europe – promoting and developing digitisation and technological innovation;
- A greener, carbon free Europe – adhering to the principles of the Paris Agreement and investing in clean, sustainable energy;
- A more connected Europe – promoting smart mobility and digital networks;
- A more social Europe – observing the European Pillar of Social Rights and supporting education, opportunity and inclusivity; and
- A Europe closer to the citizens – supporting local development programmes and sustainable urban development.
The funding allocation system will be adjusted in the 2021-2027 EU Cohesion Policy: where the proportion of funding a Member State received was previously based on its GDP per capita, the new policy will retain GDP as a predominant factor but also take into account other issues affecting national development such as youth unemployment, the impact of climate change and education levels.
Jyrki Katainen, former Finnish Prime Minister and the commission’s Vice-President for Jobs, Growth, Investment and Competitiveness, said: “Over the next decade, the EU Cohesion Policy will help all regions modernise their industry and invest in innovation and the transition to a low-carbon, circular economy. In addition, our proposal will further contribute to a business-friendly environment in Europe, setting the right conditions for growth, job creation and investment.”