The European Union Structural Fund Allocations

Abstract

The growth of European Union territorial policy competencies has brought with it significant budget ary changes and heralded ambitions of a 'Europe of the Regions'. Regional policy funding now commands around 30 per cent of all European Union expendi ture. In the recent (1994-99) round of structural fund allocations there were more 'winners' than 'losers'. Over 60 per cent of the European territory is now covered by the funds. A number of local authori ties, justifiably pleased with the award of funds to their territories, are full of 'campaign lessons' of 'successful lobbying in Brussels'. Yet structural fund application procedures dictate that individual regions cannot enter into negotiations with the EU to obtain funds; rather, they can only seek to influence member states, the 'gatekeepers' for applications made to the EU for structural funding. The real 'winners' of struc tural fund awards are the member states themselves. This is because the spending of structural funds is diffcult to audit with any certainty, enabling member states to use European money as substitute territorial funding, rather than meeting EU rules designed to ensure that European funds are additional to national spending on the regions. Detailed insights are pro vided into the processes of applying for, spending, and auditing EU structural funds, demonstrating how it is possible for member states to draw benefit for central government spending programmes from funds intended for territorial initiatives. Rather than a 'Eur ope of the Regions' it would appear that EU spending can be recycled back to national governments, reinforcing centralization rather than creating decen tralization. The absence of strong regional 'policy net works' of public and private players in centralized unitary member states to monitor additionality exacerbates the problem. Case study material from Grampian, Scotland, is presented to illustrate these processes.