The European Commission is considering major changes to the way EU funds are allocated, and could link part of the budget to performance targets for Member States. The move marks a departure from previous practice, which allocated cohesion funding solely on the basis of pre-defined development criteria -Politico writes.
According to a document approved by the European Commission and obtained by the newspaper, the distribution of cohesion funds could be completely overhauled. Currently, the system works by giving more money to less developed regions to help them catch up. The proposed changes outlined now aim to introduce a more results-oriented approach to the allocation of funds and to make payments conditional on the achievement of specific targets, » the portal says.
Cohesion funding of €392 billion for the period 2021-2027 has traditionally played an important role in supporting the growth of economically disadvantaged regions across Europe. In the wake of the debate on the possible enlargement of the EU, with Ukraine and several countries in the Western Balkans set to join, the effectiveness of these funds in reducing economic disparities has come under the spotlight again. The proposed reforms can serve as a mechanism to ensure accountability and to encourage the necessary reforms, particularly in areas related to democratic standards.
The Commission’s proposal is expected to be the subject of lengthy discussions between Member States in the negotiations on the next seven-year budget cycle, starting in 2028. Any formal changes to the distribution of funds will require unanimous approval from national governments, underlining the importance of reaching consensus on this issue.
