Invest in cities to spur growth, EU urged

The European Union's next long-term budget must recognise the potential of the continent's towns and cities, which – given the right support – can deliver jobs, prosperity and renewed confidence, writes the secretary general of EUROCITIES


About this time last year, the European Commission presented its proposal for the long-term European Union budget for 2014 to 2020. It has since been followed by much discussion around the essential questions of how much the EU should be spending and on what. The new Cypriot EU presidency will start throwing some figures into the negotiations between member states in the early autumn, which should certainly spice up the debate.

We all know the context: an unprecedented economic crisis increasingly accompanied by a growing political crisis of public confidence in governments and Europe itself. The next long-term EU budget can potentially provide some responses to both challenges.

For this to happen, EU member states need to move beyond national, political and historical positions and agree that the number one priority of the EU budget must be economic growth and job creation. Also, member states must agree to direct EU spending where it makes the greatest and most visible impact for the majority of our citizens. In the current economic climate, spending needs to connect visibly with our citizens if they are to appreciate the value that Europe adds.

The Common Agricultural Policy has, for good reasons, traditionally been a main plank of the EU budget. Clearly, food security is important to all of us. Currently Europe spends as much on the CAP as on regional policy. But if we break that down further and compare what is spent per head in urban compared to rural areas, the picture is radically different. It is only a limited percentage of regional policy funding that goes to urban areas. Estimates of cities' share of EU regional funds vary from 10 per cent to 35 per cent. But even assuming that as much as half goes to urban areas, the per capita EU spend in the countryside through CAP is nevertheless as much as five times that for towns and cities.

Yet agricultural and rural expenditure is less visible and reaches far fewer people than regional investment through structural funds, in particularly in urban areas where 75 per cent of people live. In 2014, when the EU starts its next long-term budget, we will be well into the 10-year period that the EU has set itself to reach the Europe 2020 objectives for smart, sustainable and inclusive growth. To deliver on those objectives, we urgently need to rethink the main priorities of the EU budget for 2014-2020.

We argue that we must refocus priorities to equip the EU for the challenges of the future. Regeneration, skills, social inclusion, research, innovation, energy efficiency and sustainable transport should top the list. Funding programmes for 2014-2020 must have a clear urban dimension, recognising the potential of Europe's large cities to act as catalysts for creativity and innovation.

Cities must be involved as partners on an equal footing with regional authorities when priorities for regional and sub-regional investments are established. And cities must to a much larger extent be able to manage and implement their own EU investment programmes under the structural funds to ensure that local needs are adequately matched and returns maximised.

Cities are the engines of the European economy and their economic performance is critical for the EU's global competitiveness. When money is tight we must invest where we can have the biggest impact for Europe as a whole. With a fairer share of support, metropolitan Europe is capable of delivering jobs and prosperity that will benefit everyone and help rebuild public confidence.

Paul Bevan is secretary general of EUROCITIES