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European Commission - Directorate-General for Regi : Speech - A New Cohesion Policy for Growth and Jobs in Europe

11/07/2013 | 11:45am US/Eastern

European Commission

Johannes HAHN

Commissioner for Regional Policy

A New Cohesion Policy for Growth and Jobs in Europe

Reform of EU Cohesion Policy/Brussels

7 November 2013

Today we have taken a major step forward in equipping the EU to support Europe's real economy - to create jobs by supporting its SMEs, kick-starting innovation and fostering its low carbon economy. The deal confirmed just now by the REGI Committee which is the European Parliament's lead committee in this, turns EU Cohesion Policy into vital tool to deliver Europe's Growth Agenda.

I am told that even outside of Europe this reform is being seen as one of the most innovative ways to turn Regional Policy into an instrument for growth and the well-being of citizens.

This vote clears the way for Member States and regions to prepare the new strategies and programmes which will mobilise €325 billion of EU resources. Taking into account the national contribution of member states, and the leverage effect of financial instruments - which we are promoting heavily in the next period - the overall impact is likely to be more than €500 billion.

Let me remind you how important the European seven year budget is compared to national annual budgeting. This gives both private and public investors a predictability which will in turn trigger more investments.

After long negotiations, I am glad to note that the original proposal of the Commission has been confirmed by the Council and the Parliament. The agreement concludes the fundamental new direction of Cohesion Policy, from a focus on infrastructure investment to a concentration of money that promotes and stimulates the economy. Crucially it introduces three new elements to make it more effective and oriented towards clear results. Let me briefly remind you of these:

First - Member States and regions shall make clear choices and concentrate funding on a few priorities of EU relevance: R&D and innovation, SME support, energy efficiency and renewable energies, poverty reduction, fight against unemployment, and job creation. For SMEs alone, support will double from €70 billion now to at least €140 billion in the next period. As well as this, at least €23 billion in investments can be guaranteed for renewables and energy efficiency. This is a vitally important area for growth. And it will help to meet EU climate goals and reduce energy dependency.

Secondly - Member States and regions will have to spell out clearly what objectives they want to achieve with the available funding and they will have to identify exactly how to measure progress towards those aims. It's all about quantifiable results - and also about transparency. Our changes will allow citizens to check how resources are used and it will allow the European Institutions to hold regular political debates on the functioning of the policy. This means that it won't be enough to announce, for example, that €100 million will be allocated to innovation. It will have to be explained that this investment is needed, for example, to increase by 10% the number of SMEs introducing new products into the market or establishing R&D contracts with universities.

The third key element in our reform: For the first time we are introducing conditions that Member States and regions must meet before funds can be spent. This is to ensure that investments are made in an environment which is conducive to maximize their impact. For example, business friendly reforms, transport strategies, measures to improve public procurement systems or compliance with environmental laws are conditions which will need to be met before investments can be made in those areas.

Now it is for the European Parliament to confirm today's committee vote. I trust they will do this. The deal today also pulls together all EU funds in a simpler, common framework making them easier to use and more strategic as a tool to put Europe firmly on path of recovery. Investors are waiting, regions are waiting. It is vital these programmes start on time. It is also a precondition for the approval of the EU's next seven-year budget. I urge the Parliament and the Council to take up their responsibility.

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