FEBRUARY 2003 FEBRUARY EuropeBUILDING A BIGGER SOUTH EAST ENGLAND’S view on the future of EU cohesion policy SUMMARY » South East England is a large and relatively affluent border region within the EU. But it also has pockets of deprivation, places with high levels of unemployment, homelessness, weak economic prospects and a degraded environment. Future EU cohesion policy should similarly reflect the region’s dual approach in both tackling remaining disparities, as well as pursuing an outward and more forward looking approach. This includes redressing long-term under-investment in the region’s infrastructure and business support, but also moving from traditional manufacturing to a knowledge-based high technology future and the development of leading-edge sectors in the region. « EuropeBUILDING A BIGGER Designed and produced by Jackson Lowe Marketing www.jacksonlowe.com 1 Role of Cohesion Policy » a re-defined European Social Fund focused on innovative actions and support for disadvantaged South East England has a key contribution to groups and the organisations which work with them; make to overall cohesion in an enlarged Union in » reform of the Common Agricultural Policy (CAP) promoting issues such as governance, economic alongside that of regional policy, with any redirected development, environmental policy and research monies allocated to a more effective and equitable and development.This approach also requires: rural policy. » improving the effectiveness of the structural instruments rather than necessarily increasing the 3 Principles of Cohesion Policy EU’s budget; Our experience of Structural Funds in the South » tackling the remaining areas of deprivation within East suggests that a degree of flexibility in some otherwise prosperous ‘intermediate’ regions of the aspects could lead to increased effectiveness by: current EU; » moving from map-based targeting as a means of » capitalising on the positive characteristics and concentrating resources to one which takes more opportunities of such regions, especially to support account of the situation on the ground; those still catching up; » reviewing the match-funding principle in the light of » the continued support for cohesion through the adverse effects arising from its current application. Structural Funds programmes and more effective support and resources from the UK Government to encourage participation in such programmes; 4 Delivery of Cohesion Policy » support for the transfer of regional and local The South East supports the need for further authority expertise to Central and Eastern European decentralisation to regional and local level to Countries (CEECs). ensure the effective delivery of EU support whereby: 2 Priorities » regional and local players have a key role in future in deciding and managing appropriate interventions in Aspects of cohesion policy that are of key line with EU priorities which also add value to importance to the region include Trans-European regional and local strategies; Co-operation, Regeneration,Training and » a single framework is developed for the distribution Employment and Rural Development, where our of resources – one model is that of the Area experience of EU programmes provides lessons for Investment Framework (AIF) currently being piloted the future. In particular, the South East supports: in the South East which could be scaled up to an » the continuation and strengthening of the INTERREG appropriate size for the delivery of EU support. initiative, including a greater focus on larger scale strategic initiatives and rationalisation of the current different INTERREG strands; » a future EU regeneration initiative focused on potential, innovation and opportunities, including increased provision for exchange of information and experience at European level; BUILDING A BIGGER EUROPE 3 INTRODUCTION » » » » 4 BUILDING A BIGGER EUROPE SOUTH EAST ENGLAND’S VIEW ON THE include major shortages in basic key skills, ongoing restructuring (70,000 manufacturing jobs will be shed by FUTURE OF EU COHESION POLICY 2005) and congested road and rail infrastructure. In order for its regional economy to prosper in this South East England is the tenth largest EU region in terms context, the South East is seeking to make good the of population with more inhabitants than Finland and a few long-term under-investment in the region’s infrastructure less than Austria. Despite its image of prosperity the and business support. At the same time, it is also region is also one of great contrasts, with areas of relative pursuing an outward and forward-looking approach, for affluence certainly but also places with high levels of example, in the transition from traditional manufacturing unemployment, homelessness, weak economic prospects into a knowledge-based high technology future which and a degraded environment. Measured in Gross Domestic has seen the development of leading-edge sectors in the nd Product (GDP) per head, the South East is 22 out of 77 region, such as biotechnology, healthcare, marine regions in the European league table (Eurostat 1997). In technologies and multimedia. It is this dual approach recognition of this situation, parts of the region are which the South East would also like to see reflected in currently beneficiaries of a number of major EU funding the EU’s future cohesion policy. programmes for 2000 -2006, including Objective 2, INTERREG, URBAN, LEADER and EQUAL.The entire region of the South East is eligible for funds from the European Social Fund and also received allocations amounting to some £770 million (1994 -1997) under the Common Agricultural Policy (CAP). The South East supports the enlargement of the EU but suggests that maximising commitment to this process also depends on tackling remaining problems within the present Member States. In particular, future cohesion policy needs increasingly to aim at reducing disparities within regions as well as between existing regions of the EU. Hidden pockets of deprivation are a feature of the region’s economic profile and are found, for example, in the heart of the vibrant M4 corridor (wards in Slough and Reading rank 100 and 112 most deprived of UK wards respectively). Using 1998 figures, the most deprived districts in the South East are all coastal areas (or an island in the case of the Isle of Wight).These feature poor infrastructure and declining seasonal trade. The South East region, as part of an island, can also be described as an outer region of North West Europe which can potentially become isolated from its » continental counterparts. On the other hand, the region’s proximity to London also places the South East under strain, with the capital acting as a drain on economic opportunities and labour markets with negative impacts on urban and rural environments.These 5 » » » ONE ROLE OF COHESION POLICY The South East supports the enlargement of the EU and the trade and other opportunities this will bring.With the right EU and Government support, the region has a lot to give in a differently balanced and evolving Union. The role of regions such as ours will be key in terms, for example, of promoting issues such as governance, economic development, environmental policy and research and development. The region therefore supports a future cohesion policy which tackles need but also encompasses change and opportunity, enabling different parts of the Union to contribute as appropriate to cohesion. Support is, however, needed to encourage and facilitate positive engagement in this process, particularly by South East local authorities, to help meet the aims of the ‘Lisbon Agenda’ of March 2000 for the European Union ‘to become the most competitive and dynamic knowledge-based economy in the world, capable of sustainable 1economic growth and social cohesion’. » 6 BUILDING A BIGGER EUROPE The South East considers that: » more effective support and resource is also needed from the UK Government (particularly compared to » the enlargement of the EU is to be welcomed, that provided at present by some other Member including the resulting increase in trade opportunities States) to encourage participation in the EU from an expanded market; programmes of the future; » the primary need is to target aid on new Member » the Commission’s aim of linking existing EU regions States after 2006, and support the development of a to those in Central and Eastern European Countries strengthened and effective cohesion policy to (CEECs) should be supported in order to facilitate encompass enlargement. However, this should firstly transfer of knowledge and experience. But the be through improving the effectiveness of the expressed need of the CEECs for regional and local structural instruments rather than necessarily authority expertise, including in managing the increasing the EU’s budget; Structural Funds, should also be more fully » this shift in emphasis only increases the importance recognised within future programme criteria or to overall EU cohesion of involving other parts of the through a specific new EU initiative. Union in cohesion actions, including tackling the remaining areas of deprivation within otherwise prosperous ‘intermediate’ regions. This is best undertaken at regional and local level, building on the partnership working that already exists between local authorities and regional agencies; » a key role for cohesion policy in intermediate regions should also be to capitalise on their positive characteristics and opportunities, especially to support those still catching up; » the continued