Italy received 42.2 billion euros from European cohesion funds For the programming cycle 2021-2027. Suddenly these funds have become the center of the Italian political debate, after Giorgia Meloni, following the proposal of Ursula von der Leyen to allocate a part of these to the rearmament of the individual Member States, said:
“As far as I am concerned, I will propose to the Parliament to clarify immediately that Italy does not intend to divert cohesion funds, very important funds for us, on the purchase of weapons.”
At this point there are a couple of questions that would be addressed to the Prime Minister and the administrators of local authorities: how was the money of European cohesion funds spent? How much money has been allocated until the expected budget time? Small spoiler: not well.
Desserous premise to avoid pro quo here. European cohesion funds have nothing to do with the PNRR (National recovery and resilience plan), which derive from the Next Generation EU program and have different objectives and methods of use.
What are European cohesion funds and how they are divided
European cohesion funds are financial instruments established by the European Union to reduce economic and social disparities between the different regions of the Member States. Were established in 1994 with the Regulation (EEC) n. 1164/94 of the Council of 16 May 1994as part of the Maastricht Treaty. These funds are divided into five main tools:
- European Regional Development Fund (ERDF): supports projects related to innovation, research and technological development; In recent years, it has also been paid to funding for small and medium -sized enterprises and to the economy at low carbon emissions.
- European Social Fund Plus (FSE+): focuses on employment, education, training and social inclusion, aiming to improve the skills of the workforce and to promote the inclusion of disadvantaged categories.
- Cohesion fund (FC): intended for Member States with a per capita gross national income of less than 90% of the EU average, it finances projects in the environmental and transport infrastructure.
- European Agricultural Fund for Rural Development (Feasr): supports the development of rural areas, promoting the competitiveness of agriculture, the sustainable management of natural resources and the action for the climate.
- European Fund for Maritime Affairs, Fishing and Aquaculture (Feampa): promotes sustainability in the fishing and aquaculture sector, contributing to food safety and coastal economies growth.
The planning of the funds takes place on a northern basis, with the current period that covers the years from 2021 to 2027
How were previous cohesion funds invested?
Italy has had access to European cohesion funds through three programming cycles. The first cycle of funding was in the seven-year 1994-1999, but were intended for only four Member States: Spain, Portugal, Greece, Ireland. From the 2000-2006 programming, the funds destined have increased and the programs enlarged to all Member States. Currently Italy is benefiting from the fourth tranche.
2000-2006. During this period, Italy received around 32.8 billion euros in European structural and investment funds. However, the effectiveness in the use of these resources has been compromised by bureaucratic delays and a limited administrative capacity, which led to incomplete absorption of available resources.
2007-2013. In this cycle, Italy benefited by around 28.8 billion euros. Despite the efforts to improve the spending capacity, the country has continued to encounter difficulties in complete absorption of funds, with an effective expense less than expectations. The resources were intended for urban mobility projects, sustainable development and digitization, with variable results in terms of occupation and competitiveness of SMEs.
2014-2020. During this period, Italy had access to about 62.8 billion euros. Despite a focus on ecological transition, technological innovation and digital infrastructure, the effectiveness in the use of funds has been hindered by administrative inefficiencies and by a limited ability to implement the projects in the scheduled times, compromising the expected economic impact.
Like Italy is spending cohesion funds 2021-2027
For the programming period 2021-2027Italy received 42,179,533.19 billion euros from European cohesion funds. These funds are distributed through the European Regional Development Fund (ERDF) and the European Social Fund Plus (FSE+); Below are the expense items and the trend.
Allocation of funds by sector:
- Green transition and environmental sustainability: about 12 billion euros They are intended for energy efficiency projects, reduction of CO₂ emissions, renewable energies and sustainable management of natural resources.
- Innovation, research and competitiveness: beyond 9 billion euros They are assigned to the support of companies, to digitization, to scientific research and technological development.
- Social inclusion and employment: about 8 billion euros They are invested to encourage employment, in particular youth, and improve training and education systems.
- Sustainable infrastructures and mobility: about 7 billion euros They finance the enhancement of public transport infrastructures, the modernization of railway networks and the improvement of digital connectivity.
- Health care and social services: about 6 billion euros They are intended for the improvement of health services, social inclusion and contrast to poverty.
To date, Italy has started the implementation of numerous projects, but the effective expense It still remains limited compared to the funds assigned and the work progress is low. As already happened in previous cycles, the actual spending capacity of these funds represents one of the main critical issues. To avoid that resources remain unused or are expected in an ineffective way, it is essential to improve the governance of funds and accelerate the implementation processes.
