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The Eurocities report ‘Outlook on the urban dimension of cohesion policy’ provides evidence on how cohesion policy supports sustainable urban development in over 1,000 EU cities, including clean urban transport infrastructure, energy efficient buildings, cycle tracks and footpaths. The report’s findings show that EU support has become crucial for driving local urban transitions and it must be protected.

The urban dimension of this policy ensures that investments are based on the needs of places and integrated in territorial development strategies. It is a clear example of how the EU can partner with cities to bring concrete benefits to citizens.

Compiled with input from 29 European cities, the report highlights the achievements and challenges of the policy for cities, while also bringing specific city examples and explaining how they think it can better support them in the future.

There is a strong call among many cities for more direct ways to manage EU funding to enhance their agility and reduce administrative burdens. Cities also make it clear that they want to be considered full partners of the EU, with a strategic role in defining where and how investments should be delivered.

Amid concerns for the future of cohesion policy after 2027, the report supports Eurocities call for a stronger future policy that is inclusive of all territories. It is our first step to promote an evidence-based debate in future EU budget negotiations.

Read the full report.

Background

As the EU’s main public investment policy, the cohesion policy has historically supported the development of all territories across Europe, including urban areas. However, in recent years, the policy has developed a fully-fledged urban dimension, making it one of the most important policies supporting investment and innovation in Europe’s cities.

Looking ahead, the outlook for the current cohesion programme from 2021 – 2027 looks positive for cities, with the EU earmarking €24 billion to support sustainable urban development, including urban transport and social infrastructure.

But, despite these positive developments and the policy’s increased funding and resources, cities do not always have a say in where they spend their resources, and there are several areas where cities believe improvements can still be made. There are also serious concerns about the future of cohesion policy, with suggestions that the policy, and particularly its urban dimension, are under threat in the post-2027 EU budget.

The shifting political focus towards industry and geopolitics has put cohesion policy on the sidelines, while some national governments have started to promote a more centralised approach to EU investments, a step already seen in the NextGenerationEU recovery plan. At the same time, some political representatives are promoting a false division between urban and rural areas, suggesting that sustainable urban development – which in reality can promote urban-rural cooperation – should no longer be one of the focuses of the policy.

In response to these concerns, Eurocities and its members are working to ensure that the next European Commission places cohesion policy high on its agenda. Cities are calling on the EU to make the future policy stronger and inclusive of all territories.

The Eurocities report supports this position, building awareness about the significant benefits of the cohesion policy for cities and support the work of Eurocities and its members to defend the urban dimension of cohesion policy in future negotiations with the next mandate of EU institutions.

Cities’ mixed experiences

Multi-level governance, based on the partnership principle, is at the core of cohesion policy. It emphasises involving local and regional authorities in the decision-making process of the cohesion policy, alongside the EU, national governments, economic and social partners and other relevant stakeholders. This partnership principle is complemented by the policy’s urban dimension, which earmarks specific funding for urban areas, through investment tools such as the European Regional Development Fund.

However, while these principles are key elements of cohesion policy, Eurocities new report shows that cities experiences of their implementation has often been quite varied. This is not surprising as cohesion policy is a redistributive policy, and the allocations for cohesion investments vary greatly between EU regions, with huge differences in terms of what the minimum 8% earmarked for cities means.

It also depends very much on how national governments decide to implement the partnership principle and involve all cities in the delivery of the urban dimension. Overall, 50% of surveyed cities rated the partnership principle as good or very good, while the remaining cities found it sufficient or insufficient.

Impact of Covid-19

The report finds that the impact of Covid-19 on the implementation of the 2014-2020 cohesion policy period was profound. The European Commission introduced several emergency measures, programmes and schemes designed to offer increased flexibility and additional resources to implementing authorities.

The surveyed cities’ assessment of these measures reveals a mixed response. Many cities see the flexibility as only partly positive (44%), while a significant number view it very positively (34%). Only a small number report a very negative perception (4%).

The impact of Covid-19 has led to severe delays in the implementation of cohesion funds for the 2014-2020 period, which resulted in delays in the start of the 2021-2027 programming period. This was also aggravated by the fact that governments, including cities, have largely prioritised the funds from the Next Generation EU recovery plan, provided through the plan’s Recovery and Resilience Facility (RRF), which must be spent by 2026.

However, as outlined in the Urban Recovery Watch report, authored by Eurocities and the Global Cities Programme at CIDOB (Barcelona Centre for International Affairs), and confirmed by the cities surveyed in the new report, there are serious concerns about lack of synergies between the two EU funding instruments all contributing to administrative burdens.

Some of the cities surveyed believe the two funding programmes can complement each other, suggesting that strategic alignment with local needs could enhance their effectiveness. However, the majority of cities express concerns about potential overlaps.

Fit for the future?

The Eurocities report shows that the experiences of the 29 surveyed cities were complex and varied when it came to implementing cohesion funds, with cities having different levels of resources and very different levels of responsibility.

Despite the difficulties faced, cities are clear that the funds have been a great support for their ambitions. With that said, many cities state that they would like to be entrusted with greater resources and are calling for more direct ways to deliver cohesion funds to local administrations.

When asked whether the cohesion policy’s current tools and instruments are effective enough to deliver urban transformation, most cities highlight that these tools are only partly fit for purpose.

In relation to whether cities would prefer more direct funding through cohesion policy or are satisfied with the current earmarking approach, the responses are nuanced. While the majority of cities would like the earmarking approach replaced with direct funding (56%), a consistent group of cities is satisfied with the current approach.

Next steps

The new Eurocities report presents a first step towards a better understanding of the urban dimension of cohesion policy and its implications for cities. As highlighted in the Eurocities manifesto ahead of the 2024 elections, cities are asking for increased support from the EU to carry out the many urban transformations that are required.

Looking ahead, as discussions on the future of the cohesion policy and its support from the next EU budget gather pace, Eurocities will continue to ensure that the important position of cities is recognised in the debate.