Position paper on the future of Cohesion Policy 1

POSITION PAPER economic, social and territorial cohesion: future of cohesion policy

Euregio Scheldemond (a crossborder partnership of the provinces of East-Flanders/BE, West- Flanders/BE and Zeeland/NL, see annex 1) would like to thank the European Commission for the opportunity, given through the consultation on the Fifth Report on Economic and Social Cohesion, to give input for a future cohesion policy.

Executive summary; A 10 point program for the future of cohesion policy

1. Euregio Scheldemond strongly welcomes that the 5th Cohesion Report foresees the continuation of a robust European cohesion policy for all regions

2. Development and investment partnership contract should not lead to complicated decision making processes and moreover have to be made with the involvement of regions.

3. Thematic concentration can be achieved by smart specialization proposed by regions themselves.

4. Euregio Scheldemond is opposed to making a lot of priorities obligatory. While innovation and the EU2020 strategy should be at the heart of cohesion policy, it should not be the only priorities.

5. Euregio Scheldemond welcomes a 10 year programming period but only if there is a review of the program and priorities after 5 years.

6. Euregio Scheldemond strongly opposes the concept of macro-economic and institutional conditionality. In no way should regions be punished for the failure of their national governments.

7. Incentives can be used to mobilize stakeholders to develop common strategies and clusters of excellent projects.

8. Big cities and metropolitan areas are not the only source of innovation. Clusters of towns and cities should be able to design and manage cohesion programs, and we would like to see this principle expanded to any group of (cross-border) municipalities holding common concerns.

9. The audit process can be greatly simplified by using lump sums and standardized calculation of costs and creating one list of costs which are (in)eligible for funding.

10. Concerning for example new forms of financing such as revolving funds, the European Commission should help regions by leaving less room for ambiguity in implementing regulations. Ambiguity often leads to harsher and stricter implementation rules because of the fear of sanctions. Position paper on the future of Cohesion Policy 2

Questionnaire

1. How could the Europe 2020 Strategy and cohesion policy be brought closer together at EU, national and sub-national levels?

Firstly, the most import way of delivering the EU2020 strategy is by ensuring that all regional governments are mobilized to deliver the EU2020 strategy. In that respect Euregio Scheldemond strongly welcomes that the 5th Cohesion Report foresees the continuation of a robust European cohesion policy for all regions in the EU. Secondly, cohesion policy and the EU2020 must take fully use of the partnership principle; interventions have to be defined by the regions themselves, in coordination with the relevant stakeholders.

2. Should the scope of the development and investment partnership contract go beyond cohesion policy and, if so, what should it be?

The development and investment partnership contract should be further elaborated and it must be ensured that they do not further complicate the decision making process. What is worrying however, is that these contracts are foreseen between the EU and the Member states, largely ignoring the partnership principle. We believe that a mechanism should be foreseen to get the regions on board in establishing the contract. At any rate these new contracts should cover only EU funds, not domestic funds.

3. How could stronger thematic concentration on the Europe 2020 priorities be achieved?

Stronger thematic concentration can be used by linking a small number of European priorities to regional smart specializations. Regions themselves should be able to choose; they know with which challenges and opportunities they can best contribute to the EU2020 strategy and other European challenges. Following a challenge put forth by Member of European Parliament Lambert van Nistelrooij to choose our smart specializations; Euregio Scheldemond has chosen its smart specializations: sustainable energy in ports, biobased economy and ambient assistant technologies. We are already starting preparations for major innovation projects within these fields – also for other programmes than Interreg, such as the Framework Programme.

At the same time we believe some room should be left to take on opportunities and challenges which cannot be met by innovation alone; watermanagement in times of climate change, aquaculture, agroclusters and demographic changes (for example depopulation). Also, it should be possible to review the priorities chosen. In that respect we welcome the idea of a 10 year programming period, but only if there is a review after 5 years.

4. How could conditionalities, incentives and results-based management make cohesion policy more effective?

Euregio Scheldemond strongly opposes the concept of macro-economic and institutional conditionality. In no way should regions be punished for the failure of their national governments, whether it be on implementing reforms or on the Stability and Growth Pact . Moreover, we would like to point out that in the case of cross-border and transnational programs, conditionality would Position paper on the future of Cohesion Policy 3

spill over across the border, effecting regions in countries which didn’t do anything wrong, and thus hijacking the implementation of projects.

In respect to incentives, Euregio Scheldemond is of the opinion that these could be used to make cohesion policy more efficient. By using additional resources to fund clusters of excellent projects. Incentives could trigger cooperation between governments, research and technology organizations and companies to develop common thematic strategies and implement these through clusters of projects. The funding of the implementation of such strategies would result in better focus, mature projects and engagement from the field. Moreover it would lead to less problems with the N+2 principle.

5. How could cohesion policy be made more results-oriented? Which priorities should be obligatory?

By using the above mentioned bottom-up strategies cohesion policy would become more results- orientated. Euregio Scheldemond is opposed to making too much priorities obligatory. This would limit the region’s unique ability to identify area-specific challenges and opportunities and brokering between relevant stakeholders. However, an argument can be made to oblige that a certain amount of resources goes to innovation projects. However we would like to guard that a narrow or “hard” definition of innovation is being used. Moreover, we would like to point out that some challenges (watermanagement in relation to climate change, safety, answers to demographic challenges such as depopulation) cannot be met with innovation alone, and require more traditional projects.

6. How can cohesion policy take better account of the key role of urban areas and of territories with particular geographical features in development processes and of the emergence of macro- regional strategies?

The 5th cohesion raport singles out urban areas as engines of growth, and meeting places for creativity and innovation. Euregio Scheldemond would like to stress that big cities are not the only places where economic growth and innovation is possible. Clusters of smaller cities with much interaction also deliver growth and innovation. In the province of Zeeland, the medium-sized cities of Middelburg, Vlissingen, Goes and Terneuzen are directly bordering eachother. Because of a lot of interaction between them, there's a good climate for innovations. The same can be said for the West-Flemish cluster of , , -Heist and Ostend. East-Flanders has one big city (), which is by itself a regional engine of growth, but can 'deliver' even more in connection with smaller bordering cities such as Sint-Niklaas, Aalst and, across the border, Terneuzen.

Moreover, a too narrow focus on cities could unintentionally but surely run counter to achieving social, economical and territorial cohesion. A lot of European rural areas are confronted with an ageing population, the migration of young entrepreneurs and even depopulation. A focus on cities or metropolitan areas could accelerate this trend. Instead of focusing on the financial support for cities and metropolitan areas, cities could be used as nodes to establish better links between the urban, the rural and the peri-urban areas.

Euregio Scheldemond suggests another way to use the key role of urban areas than explicitly focusing finances on cities. In the Flemish and South-Dutch Objective 2 programmes provinces and Position paper on the future of Cohesion Policy 4

cities have contact-officers as direct partners for people that want to start projects. This lowers the treshold and helps in implementing a place-based approach.

Amongst territories with particular geographical features we also share border areas. Euregio Scheldemond stresses the importance of substantial funding for crossborder cooperation. Crossborder cooperation helps border areas become transition zones so EU-wide territorial cohesion can be established. Interreg is the most recognizable 'truly European' part of cohesion policy, for citizens.

Macroregional strategies can in some cases have an added value. In the Baltic and Danube areas there is no long tradition of crossborder and transnational cooperation. Here, the development of macroregional strategies helped bring together goals of member states. The regions however were no (equal) partners in this process. In Northwest Europe there already is a strong transnational cooperation, based on multilevel governance: in the transnational programmes for the Northsea (and the permanent cooperation in the Commission), for Northwest Europe and recently the maritime 'Two Seas' area. We suggest to hold on to these 'macro regions avant la lettre'.

7. How can the partnership principle and involvement of local and regional stakeholders, social partners and civil society be improved?

As mentioned under point 8, incentives can be used to anchor the partnership principle around common prioritites within the operational programs. This would mobilize regional stakeholders, ngo’s, research centers and others. Moreover, it is of crucial importance that regions are involved when agreeing on the development and investment partnership contract.

8. How can the audit process be simplified and how can audits by Member States and the Commission be better integrated, whilst maintaining a high level of assurance on expenditure co- financed?

The audit process can be greatly simplified by using lump sums and standardized calculation of personnel cost and other costs. In the current situation a lot of energy and time is lost because every operational program has to re-invent the wheel. By offering a standardized and unambiguous way of calculating for example personnel cost a lot of time can be saved. When it comes to procurement, cross border projects are facing a lot of troubles. The European Union could again propose a standard solution. The member states in crossborder programmes could for example use one and the same minimum threshold for procurement rules. Europe can play a role in achieving this.

9. How could application of the proportionality principle alleviate the administrative burden in terms of management and control? Should there be specific simplification measures for territorial cooperation programs?

It seems smart to focus controls on the largest projects. Territorial cooperation programmes certainly could use specific simplification measures. Crossborder cooperation is already complex and the administrative burden for project partners has become so large that many organizations lose their engagement for crossborder cooperation and investment projects.

10. How can the right balance be struck between common rules for all the Funds and acknowledgement of Funds' specificities when defining eligibility rules? Position paper on the future of Cohesion Policy 5

The European could make great strides in simplifying its programs, yet acknowledging the Funds' specificities by making the following things standard for all programs;

· The Commission creates one list of costs which are ineligible for funding, regardless of the programs. This list would have to be as clear as possible and especially caution would have to be taken to make sure that translation does not lead to ambiguity; · A second list, which provides details about costs which are eligible for all programs; · A third list would describe all the eligible actions depending on the program. Every group of programme partners can decide on whether to make these costs eligible. This would not only help people searching to finance their projects but also help national and regional governments to adjust their investment programs to complement the European ones; · A unified way of reporting for all programs; · A standardized way of calculating overhead costs; · Where possible work with lump sums.

11. How can financial discipline be ensured, while providing enough flexibility to design and implement complex programmes and projects?

There has to exist a strict division between content, finance and audit. The managing authority, certifying authority and audit authority have to work independent and autonomous from each other and from the involved governments. This in no way entails that the bodies cannot communicate with each other. Regular contact can identify bottlenecks before they appear. New ways of financing like revolving funds would also ensure flexibility while ensuring discipline.

At last, the European Commission has to leave less room for ambiguity in the implementation of regulations. In our case, ambiguity leads to harsher and stricter implementation rules because of the fear of sanctions in member states and regions; people cover themselves. Concerning new forms of financing such as revolving funds, the European Commission should help regions by proposing in detail how such financing schemes could be undertaken within the broader rules for the cohesion funds.

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Position paper on the future of Cohesion Policy 6

Annex: Euregio Scheldemond

Euregio Scheldemond is a permanent platform for the Belgian provinces East and and the dutch province Zeeland. In the period 1991-2013, four consecutive Interreg-programmes contributed to the cooperation between these. In all, the subsidy from the European Commission for these four programmes amounted to an estimated € 188 million. Interreg I and II (respectively 3 and 11 million) were executed within the framework of Euregio Scheldemond; Interreg III (80 million) was and Interreg IV (94 million) is executed within the interconnection of Border region Flanders - the Netherlands, with the remaining 5 provinces along the Flemish-Dutch border. Within these various programmes, partners from these provinces participated in about 250 projects, ranging from small- scale ‘people to people’ actions (from 10 to 50.000 Euros) to projects like Bio Base Europe, with a budget of over € 21 million.

As a permanent cross border platform Euregio Scheldemond has been involved in several Interreg Programmes. In the period of 2007-2013 the provinces of East Flanders, West Flanders and Zeeland commonly made use of 5 Interreg programmes, being Interreg IV-A Flanders-The Netherlands, Interreg IV-A Two Seas, Interreg IV-B North West Europe, Interreg IV-B North Sea and Interreg IV C. Common projects in the frame of these programmes are often generated by cross border policy which is developed by the provincial governments together with relevant partners from the cross border regions.

Next to the Flemish and Dutch provincial governments also the communities on both sides of the border are represented in Euregio Scheldemond. The Scheldemond Council is the highest consultation platform of the Euroregion. It has eight thematical departments, in which all relevant parties are represented, such as social partners, educational and security institutions and the field of culture. The Scheldemond Council and its departments tackle challenges and detect bottlenecks in the cross border area. The development of interesting projects, complementary to the possibilities in the Interreg programmes, is facilitated through the Scheldemond Fund and the Fund of "Culture without borders". Moreover, the provinces contribute to a great extent to the realisation of Interreg projects through co-financing.