Keynote speech by Commissioner Elisa Ferreira at the European Parliament's exchange of views with the Committee on Regional Developments (REGI Committee)

Exchange of views REGI Committee

President Omarjee (dear Younous),

Honourable Members,

At this last REGI meeting of the current legislative term,thank you for this opportunity to take stock of our joint achievements over the last 5 years, and to look forward to the future.

What a journey it has been!

When I sat for my hearing with you more than 4 years ago I have committed to do my best to have the highest possible budget for Cohesion; to set up a Just Transition Fund;to deepen the partnership principle; to pay particular attention to the needs of the more vulnerable territories from rural areas to the outermost regions; to look carefully at the brain drain afflicting many of our regions; to ensure that Cohesion is implemented in line with our principles and values.

We started off with clear priorities geared towards sustainable regional growth, innovation-driven convergence, a Europe closer to its citizens, support to the most vulnerable to the impacts of the green transition.

But this mandate has been punctuated by a series of crises.

In the midst of the pandemic, together with you, we negotiated the 2021-2027 cohesion funding regulations, while adopting unprecedented emergency measures, starting with CRII.

The first ever instrument Europe had to cope with the pandemic, was fuelled by cohesion funds thanks to your unwavering support.

The EU has had to handle immediate challenges, while staying the course on our long-term agenda of promoting sustainable and balanced development and managing the triple transition, climate, digital and demographic, to the benefit of all of Europe's regions.

Cohesion Policy has played once again a key role as a stabiliser and as an engine for long-term transformation.

First, let's focus on Cohesion as Europe's first responder:

The Coronavirus Response Investment Initiative took less than 2 weeks, from drafting the legislation, to approval.

This must be a legislative record!

And it was thanks to you, thanks to the excellent cooperation with the European Parliament in general, and this REGI committee in particular.

Our work mobilised 24 billion euros of Cohesion investments to support healthcare, to keep businesses afloat, and to protect vulnerable people.

And our excellent cooperation continued with REACT-EU, 50.6 billion euros, and the first ever payment from NextGeneration EU to bridge the gap between crisis response and recovery.

When Russia's unprovoked and illegal aggression started in 2022, Cohesion's Actions for Refugees in Europe, CARE, mobilised 13.6 billion euros of additional liquidity and 1.7 billion euros for those who welcomed refugees.

And with the SAFE amendment, 4 billion euros was released to support SMEs and vulnerable households affected by high energy prices.

Our swift response has had a real impact.

The 9^th Cohesion Report which we just adopted and will be discussing in detail in the 9^th Cohesion Forum later this week compares the regional economic recovery after Covid with the 2008 financial crisis.

For many less developed regions, recovery from the financial crisis took over a decade. But most regions recovered from the pandemic's economic shock within a year.

It was the swift European response that made all the difference. And it was Cohesion's swift action that enabled this European response.

The exceptional, close collaboration between the European Commission and the European Parliament made it possible. Especially this committee. Thank you!

But of course, the main strength of Cohesion Policy, and the main thrust of our work, is not crisis response, but long-term investment.

Our True vocation is not the firefighter, but the builder: constructing, adapting, and modernising Cohesion Policy. Better than fighting fires is preventing them from happening. This is what Cohesion Policy does: investing and building the foundations for resilient regional economies and societies, so that when crises arrive, the impact is minimised.

One of the best examples is the Just Transition Fund. 19 billion euros of European investment to support the most vulnerable coal- and carbon-intensive regions as they manage climate transition.

The Just Transition Fund illustrates some of the key elements which go together to make a place-based policy.

First, supporting regions at risk. Second, mobilising local partners. Third, building on the specific strengths of that place and those partners, to enable a transformation.

We have done a lot to promote this territorial approach that is so necessary for Europe's resilience across a number of different files.

The Long-Term Vision for Rural Areas, recognising the need to secure a future for vibrant rural life.

The renewed Strategy for the outermost regions, recognised the need for specific action to address the constraints of these regions.

We have been following through on our commitments, just last week we managed to unblock the difficult issue of support to the modernisation of small scale boats in the outermost regions.

The Harnessing Talent Communication, and Talent Booster Mechanism were our response to the reality of demographic change, zooming in the regions caught in a skills trap, preventing brain drain and developing tools to help regions retain their best talents.

The proposal on facilitating cross-border solutions where once again we worked hand-in-hand with the Parliament and this Committee to improve the lives of 150 million Europeans who live in border areas.

These are just some examples of our initiatives and Cohesion Policy's action. But as we've discussed many times, the Do-No-Harm-to Cohesion principle should also be embedded in sectoral policy.

And we have done our share to promote the regional focus and increase the links with other policies, from the European Semester process to the Net Zero Act and the New Innovation Agenda.

Most recently, the Strategic Technologies for Europe Platform (STEP) ensures that there is a clear link between future strategic technologies and the economic resilience of regions, promoting a level playing field, enabling weaker regions to attract STEP investments. I encourage programme managers to make full use of the possibilities.

All these initiatives have kept 2014-2020 programmes on track for closure: in February this year, implementation stood at 93%. This is higher than the 89% in the previous period.

For the 2021-27 programmes, implementation is also finally picking up in many Member States.

We are working closely with Member States and managing authorities to maintain a good pace, and to lift up investments where there are delays for example with the Just Transition Fund.

We are using the full potential of our instruments to build administrative capacity which is absolutely necessary for the effectiveness of our policy, for programme implementation and reform delivery alike. This is why the Technical Support Instrument, is now increasingly supporting regional and local administrations, and we have created flagship initiatives under the TSI on overcoming bottlenecks to regional growth.

During the current legislative period, we have also been steadfast in supporting Member States and regions affected by natural disasters or extreme weather events. The European Solidarity Fund mobilised over 3.4 billion euros for 45 disaster events across Europe and our neighbours.

In the MFF mid-term review, the EUSF received additional funding of more than 200 million euros per year.

Even with an increased budget, this solidarity assistance will never even be close to the damage inflicted by climate change, by constant flooding, fire, drought.

The end of this legislature gives an opportunity to look into the future as well and the 9^th Cohesion report is very timely, as we are turning to the post-2027 policy.

This report demonstrates that Cohesion Policy works.

For example, countries which joined in and after 2004, have seen their GDP per head rise from an average of just 52% of the EU as a whole, to nearly 80% in 2023. The gap has more than halved.

This is why the World Bank describes Europe as a convergence machine, and Cohesion Policy is the motor.

The policy supports EU citizens. 17 million people have been protected from floods. Almost 8 million households have better broadband connection. 63 million people benefit from better health services. We estimate that 1.3 million new jobs will be created by 2027 thanks to the combined impact of the 2014-20 and the 2021-27 programmes.

But despite these achievements, the 9^th Cohesion Report also finds that many challenges remain.

Convergence at the national level has not always been accompanied by convergence between large urban centres and the rest of the country.

Certain regions still lack basic infrastructure and some areas (remote, rural or outermost) have a more difficult access to essential services, such as health or education.

And around a third of EU regions, home to 150 million people, have yet to see a return to 2008 levels of GDP per head.

Many of these regions are caught in development traps, often characterised by lack of opportunities, and brain drain.

There is clear evidence that the length of time a region spends in a development trap, strongly correlates with higher euroscepticism.

On top of this, we must face up to fundamental changes, including the climate, digital and demographic transitions. This means there is work to be done, to ensure that no place in Europe feels left behind.

So the report draws lessons for the future of Cohesion Policy.

First, we must deepen the place-based aspect of the policy. A policy for all regions, tailored to each one of them.

Building on local strengths and opportunities, to ensure that all regions and cities, find their own development path to a successful future.

Second, new challenges require new methods. We must pursue an ambitious modernisation, and adaptation of the policy.

And new links to other policies. Because Cohesion Policy alone is not enough. And other European and national policies can no longer afford to be spatially blind.

Third, we must link to reforms, and institutional capacity building. Because investment alone is not enough: good governance and institutions are a precondition for success.

In particular, we must build the capacity of local partners. Because the partnership principle of Cohesion Policy is one of the clearest ways to bring the EU to the ground, close to citizens.

Fourth, we must make the policy more effective and more user-friendly. This means further simplification and a move towards a more performance-based delivery system adapted to the territorial nature of Cohesion.

Fifth, we must build in flexibility in a simpler way. To better react to new situations, and unforeseen crises. While still maintaining the stable framework for long-term development.

Of course, all changes must respect the nature and goals of the policy, the Treaty objective, the territorial approach and the partnership principle.

Dear colleagues, we have come a long way together these past 5 years.

We worked as partners, to help regions through some of the worst crises in living memory.

When I had my hearing with you I also committed “to ensure a special relationship with the Parliament, particularly with this Committee”. I kept this commitment. It was a privilege to work closely with you. I always felt that on the things that mattered we were on the same side of the argument. Let me praise Chair Omarjee for the way he conducted the works, as well as all political groups (coordinators and members) for your flawless support to Cohesion as a policy, a principle and a pillar of our project.

I firmly believe that the future deepening and enlarging of the European project must be accompanied by a reinforced Cohesion.

Our European house cannot be built without it.

Thank you.

I look forward to our discussion.